Reilley v. Richards

Thomas Reilley (plaintiff), a lawyer without real-estate expertise, contracted to buy land from David Richards (defendant) intending to build a house there, but after signing discovered nearly half the lot sat in a flood-hazard zone -- an area where local ordinance barred building outright, and where Reilley's builder in any event refused to build due to warranty concerns. Neither party knew about the floodplain when the deal was made, and although the contract gave Reilley 60 days to rescind for unacceptable conditions, his builder inspected within that window and could not have discovered the hidden floodplain either. After the 60 days passed and Reilley later learned of the floodplain, he sued to rescind based on mutual mistake; the trial court ruled for Reilley, but the appellate court reversed, finding Reilley negligent for not hiring engineers within the 60 days.