Reed v. King
California Court of Appeal
145 Cal. App. 3d 261 (1983)
Reed (plaintiff) bought a home from King (defendant) without knowing that a woman and her four children had been murdered there ten years earlier. King and his real estate agent knew about the murders, did not tell Reed, and even asked neighbors to stay quiet. Reed paid $76,000 for the home but alleged it was worth only $65,000 because of the murders. After learning the truth, Reed sued King and the agent for rescission and damages, but the trial court dismissed the complaint on the theory that there was no concealment of a material fact.
Whether a seller has a duty to disclose information that would materially affect a property's value or desirability when that information is known only to the seller or is not reasonably discoverable by the buyer.