If a seller fails to disclose a special assessment before the sale, what legal issue has occurred?

In cases where a seller fails to disclose a special assessment prior to a sale, the legal issue that arises is typically considered fraud. Fraud involves the intentional misrepresentation or concealment of material information in order to induce another party to enter into a contract. In this scenario, the seller's omission regarding the special assessment is significant because it could materially affect the buyer's decision-making process and understanding of the true financial implications of the property purchase.

Special assessments can lead to additional financial burdens unknown to the buyer, making it crucial for the seller to disclose such information. The seller's failure to do so may not just demonstrate a lack of transparency, but also an intent to deceive the buyer about the financial obligations they might incur after the purchase. This deception constitutes fraudulent conduct, as it aims to mislead the buyer regarding the true condition and value of the property.

Understanding fraud in real estate transactions is vital, as it highlights the importance of honesty and full disclosure in dealings. It also sets a precedent about the legal responsibilities sellers have towards potential buyers concerning material facts that could influence the buyer's real estate decisions.