The Ohio Supreme Court recently clarified what sellers must disclose and what buyers must uncover under the state’s residential property disclosure rules in Ashmus v. Coughlin [Slip Opinion No. 2025-Ohio-2412].
In Ashmus, buyers had planned to demolish and rebuild a lakefront home, but later discovered a sewer line running through the property that interfered with their construction plans. They sued, alleging fraud and failure to disclose. The Court ruled in favor of the seller, stating:
- The disclosure form is intended to alert buyers to defects that affect ordinary residential use, not potential obstacles to specific redevelopment plans.
- A working sewer line that’s visible in public records does not require disclosure, even if it affects the buyer’s intended use.
Key Takeaways for Sellers
- Working infrastructure (e.g., sewer lines, utility easements) does not need to be disclosed unless it’s physically defective.
- A seller is not responsible for a buyer’s future construction issues if the property is otherwise fit for ordinary residential use.
Key Takeaways for Buyers
- The disclosure form is designed to identify defects affecting basic livability, not limitations on future development or specific building plans.
- If a sewer line or easement interferes with a buyer’s plans but is otherwise functioning and recorded, the seller isn’t required to notify.
- A buyer’s failure to conduct their own investigation could mean losing the right to cancel the contract or bring fraud claims later.
Practical Steps and Responsibilities
- Sellers:
- Disclose known defects that materially impact how the property functions, but you’re not required to anticipate every buyer’s plans.
- Document what you disclose and retain copies of any “as-is” clauses, inspection waivers, or communications regarding buyer responsibilities.
- Buyers:
- Go beyond the disclosure form—review title reports, utility maps, and recorded easements before closing.
- Understand that “as-is” sales limit your ability to bring claims after closing, so complete all due diligence early in the process.
- Consult with your real estate attorney before waiving inspections or deadlines that protect your rights.
Selling or buying a home is a big step. If you have questions about disclosure obligations or want peace of mind before signing, our attorneys are ready to help you move forward with clarity and confidence.
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