It happens to almost everyone; you buy a product, car, house, machine, boat or appliance where at first glance nothing seems wrong, but later it turns out that there is a ‘hidden defect’ to the purchased product.
The question is then who is liable. In this article I give examples of hidden defects, explain what the obligations of the buyer and seller are and what one should pay attention to.
Definition of hidden defect
A hidden defect is a defect that becomes apparent after the purchase contract has been concluded.
Examples of hidden faults
Examples of hidden defects may include leaks, undiscovered cracks, rotten wood and asbestos in a home. Cars can also have hidden defects. Examples include reversed mileage, rusted through underside, engine problems or faulty brake line.
Machinery may also have hidden defects, such as missing control boxes/control units.
Whether something is a hidden defect always depends on the circumstances of the case. Do you doubt whether something is a hidden defect? Gentia Niesert, attorney at law in contract and procedural law, can advise you on this.
Obligation of the seller to disclose latent defects
The seller has a ‘duty of disclosure’. This means that if the seller is aware of a defect or could reasonably be aware of it, he/she must inform the buyer of it at . If the seller does not do this, the seller can be held liable for the damage suffered by the buyer as a result of the hidden defect.
Obligation of the buyer to investigate hidden defects
On the other hand, the purchaser has a ‘duty to investigate’. This means that the buyer must investigate whether there may be any defects. If a defect is visible, the buyer must ask the seller questions. For example, if the purchaser sees traces of leakage, but it is not immediately clear whether there is anything wrong, he/she must investigate. If the buyer does not fulfil this obligation to investigate, there is a chance that the buyer cannot recover damages from the seller.
What to look out for in hidden defects?
It is always advisable to check the contract of sale. Some purchase agreements contain clauses that say something about hidden defects. Think of an age clause in contracts of sale of houses, in which the seller is protected against hidden defects in ‘old houses’.
It is also advisable to keep an eye on the period within which the hidden defect must be reported.
Need advice on hidden defects?
Are you the purchasing party and have you discovered a hidden defect or are you the selling party and are you being held liable in connection with a hidden defect? Then you have come to the right place. Gentia Niesert, lawyer in contract law and procedural law, will be happy to advise you.
