A case involving the purchase of a luxury mansion for £32,000,000 and a moth infestation has been widely reported. The purchase completed in 2019 and the property included a pool and spa, gym, wine room, library, cinema and … moths. Almost immediately after they moved in, the new buyers noticed some moths. This soon developed into a plague of moths and the buyers brought a claim against the seller for the sale to be set aside and for the return of their purchase money.
The basis of the claim was that the buyers had been induced into buying the property by misrepresentations made by the seller in his replies to pre-contract enquiries. They claimed that they would not have bought it if the misrepresentations had not been made. They alleged that the seller knew that his replies to three enquiries were untrue.
Interestingly the seller knew of the moths because he had specialist treatment carried out at the property prior to it being marketed. The court found that, in the witness box, the seller 'often found himself with nowhere to go in terms of a credible explanation of what he and his wife were doing to attempt to deal with a moth problem that he did not accept existed'.
It is perhaps therefore not surprising that the court found in favour of the buyers and that they were entitled to treat the contract as ended and to the return of their purchase money (plus damages).
This case feels a million miles away from the average conveyancing transaction. But the main principles at stake apply whether they involve a mansion or a modest three-bedroom house. The key is to ensure that a seller is open and truthful about matters affecting their property, particularly when they receive questions about the property from the buyer and their lawyer. In the moths case, the court said that the seller had not honestly disclosed the 'serious infestation'.
Sellers must be careful about how they answer enquiries form a buyer – sometimes 'not aware' is not the clever answer that it appears to be.
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