Humber/Ontario Real Estate Course 4 Exam Practice

If a buyer relies on inaccurate information about water leakage in a seller property information statement and does not get a home inspection, legally:

1. The buyer cannot hold the seller accountable for future costs

2. A home inspection is mandatory in Ontario

3. A disclosure statement has no legal status for action

4. The seller might be liable for the buyer's incurred costs

5. The buyer has no recourse after closing

6. Both parties share responsibility for disclosure accuracy

The correct answer is: The seller might be liable for the buyer's incurred costs

The reasoning behind the choice indicating that the seller might be liable for the buyer's incurred costs rests on the principle of misrepresentation and the obligations of sellers to disclose known defects in a property. In situations where a seller provides inaccurate information regarding the condition of the property—particularly issues like water leakage—they may be held liable if it is found that they knowingly concealed or misrepresented this information to the buyer. If the buyer relies on the seller’s statement and does not conduct a home inspection, and if it later emerges that there was indeed a water leakage issue that the seller was aware of but did not disclose, the buyer may have grounds to seek compensation for associated costs. This legal principle is based on the expectation that sellers must operate in good faith and provide truthful information about the property's condition. In this context, the other options highlight different aspects of real estate transactions and buyer due diligence, but they do not align with the specific legal recourse available to the buyer if they are misled by inaccurate information provided by the seller.