|Frank Kosir, Jr., Esquire|
This matter addressed the issue of whether the Pennsylvania Real Estate Seller Disclosure Law (the “Law”) (68 P.S. § 7301-7315) requires the seller of real property to disclose to prospective purchasers that a murder/suicide occurred on that property. Konstantinos Koumboulis and Georgia Koumboulis (the “Koumboulis’”) were the owners of certain real property (the “Property”) situated in Delaware County, Pennsylvania. The Koumboulis’ died in a murder/suicide at the Property on February 11, 2006 and the Property was subsequently purchased at a September 23, 2006 real estate auction by Kathleen Jacono and Joseph Jacono (the “Jaconos.”) The Jaconos never resided at the Property, and soon after taking title began to make arrangements to sell the Property, inquiring with the Pennsylvania Real Estate Commission as to whether the Law required disclosure of the murder/suicide to prospective purchasers. Upon being advised that such a disclosure was not required, the Jaconos listed the Property for sale with Re/Max Real Estate and, on June 17, 2007, entered into an agreement to sell the Property to Janet S. Milliken (“Milliken”). Simultaneous to their execution of the Agreement of Sale, the Jaconos completed a Seller Property Disclosure Statement (“Disclosure Statement”) in which they failed to disclose the murder/suicide. A closing took place on August 10, 2007.
Several weeks after taking title, Milliken became aware of the murder/suicide and brought suit against the Jaconos and the real estate brokers involved in the transaction for their failure to disclose the murder/suicide. Specifically, Milliken alleged that the murder/suicide constituted a material defect that negatively impacted the value of the Property and, as such, required disclosure under the Law. The trial court, finding that a murder/suicide is not included in the list of enumerated material defects requiring disclosure pursuant to Section 7304(b) of the Act (68 P.S. § 7304(b)), concluded that a murder/suicide does not constitute a material defect and entered summary judgment for the defendants.
On appeal, the Pennsylvania Superior Court reversed and remanded the matter to the trial court for further proceedings (2011 PA Super 254, 2011 Pa. Super. LEXIS 3759 (2011)). Thereafter, the Jaconos filed a Motion for Reargument, which the Court granted, vacating its opinion. Following reargument, the Court affirmed the trial court, concluding that a murder/suicide does not constitute a material defect requiring disclosure under the Law. In issuing its opinion, the Court noted that Section 7304(b) of the Law sets forth a list of sixteen specific material defects requiring disclosure, and that each of these specific material defects are related to the physical structure of the home, its components, or the condition of the curtilage. Therefore–as the fact that a murder/suicide occurred at the Property is, at most, a psychological defect, and the language of Section 7304(b) plainly establishes that the legislature did not intend for the Law to cover psychological defects–the Law did not require the Sellers to disclose that a murder/suicide had taken place on the Property. The court further noted that requiring sellers to disclose that a murder/suicide had taken place on a particular property would create a slippery slope as to the definition of a “material defect” under the Law, potentially putting sellers in great peril if they fail to disclose any potential negative facts regarding the subject property (e.g., that a burglary occurred there several years earlier, that burglaries have occurred in the neighborhood, etc.). The Court also questioned how recently a murder/suicide would have had to have occurred in order to require disclosure, as well as how a decrease in the monetary value of a property resulting from such an event would be accurately measured.