*Please note: Any questions regarding Legal Hotline Spotlights should be submitted via the Virginia REALTORS^® Legal Hotline. Our attorneys are unable to respond to questions through our comments section.

Q: “I am the listing agent, and I know that I am supposed to disclose all material adverse facts pertaining to the physical condition of the property to a prospective buyer. However, the owner did not tell me that there were some structural issues. The owner concealed them, and the buyer found out after he began renovating the property. No one, not even the home inspector, noticed the owner had concealed this. Am I liable?”

A: Short answer, no. The answer is found in Virginia Code § 54.1-2142. Liability; knowledge not to be imputed. Specifically: 

C. Clients and licensees shall be deemed to possess actual knowledge and information only. Knowledge or information among or between clients and licensees shall not be imputed.

The law is unambiguous; if you did not have actual knowledge then you are not liable. In other words, what the owner knows does not transfer onto you unless the owner informs you. The only exemption to this is if you commit gross negligence (i.e., you really should have known or it was something obvious). So, if your client doesn’t tell you and it’s not plainly obvious that there is something clearly wrong, then you cannot be held liable for what the owner knew but did not reveal

Have a question about this article? Submit it to the Legal Hotline!

The Legal Hotline is a member benefit that has been supporting members for over 25 years. Our team of lawyers answers your important questions about real estate transactions quickly and accurately (usually within three business hours!).

Here are some tips to help make the Legal Hotline work for you!