A buyer is interested in purchasing a semi-detached home and discovers, through a pre-purchase inspection, that the shared party wall has significant structural defects causing water ingress into the basement. The seller was aware of these defects prior to listing but did not disclose them in the Seller Property Information Statement (SPIS) or verbally. Upon closing, the buyer incurs substantial repair costs. Under which legal principle could the buyer seek recourse for the undisclosed latent defect?

Question: A buyer is interested in purchasing a semi-detached home and discovers, through a pre-purchase inspection, that the shared party wall has significant structural defects causing water ingress into the basement. The seller was aware of these defects prior to listing but did not disclose them in the Seller Property Information Statement (SPIS) or verbally. Upon closing, the buyer incurs substantial repair costs. Under which legal principle could the buyer seek recourse for the undisclosed latent defect?

Answer options:

• Caveat emptor, as the buyer had an opportunity to inspect. ✅ Fraudulent misrepresentation, given the seller's intentional concealment.
• Breach of contract, due to the implied warranty of habitability.
• Negligent misrepresentation, as the seller should have known better.

Correct answer: Fraudulent misrepresentation, given the seller's intentional concealment.

Explanation: The seller's intentional concealment of a known, significant structural defect constitutes fraudulent misrepresentation, as they deliberately provided false information or omitted material facts with the intent to deceive, which induced the buyer to enter the contract. This goes beyond mere 'caveat emptor' because the defect was latent and the seller actively withheld information.