In 2002, Samuelson entered into a contract to sell his unit. He properly disclosed on the Transfer Disclosure Statement (TDS) that he was aware of flooding, drainage or grading problems and added a notation about water intrusion during heavy rains. In a subsequent conversation, Samuelson described to the buyers the repairs made in 1998 to solve the water intrusion problem.
Nearly three years after the close of escrow, the condominium garage flooded. It was only then that the buyers first learned of the lawsuits. The buyers sued the seller and others for negligence and misrepresentation. Samuelson claimed he didn't mention the lawsuits on the TDS because he thought he was only obligated to disclose pending actions.
The court ruled in favor of the buyer. The court stated that once essential facts are disclosed a seller is not under a duty to provide details that would merely serve to elaborate on the disclosed facts. However, the court added, the evidence [in this case] revealed a triable issue of fact, as the existence of the two lawsuits was the very type of material information that a potential buyer could find seriously affected both the desirability and value of the property. Moreover, Samuelson's disclosing the repairs made by the HOA in the absence of providing information about the context in which those repairs were made could be characterized as a partial disclosure, likewise creating a triable issue.