Seller did not engage in active concealment
The buyer’s attorney also argued that there was active concealment of defects by the seller. The complaint failed to make any allegation that the buyer was somehow thwarted by the seller from conducting any inspections or due diligence which could have discovered the purported defects. It was necessary for the buyer to allege material facts as essential allegations that the seller thwarted any efforts on his part to perform his due diligence. See, Jablonski v Rapalje, 14 AD3d 484, 485 [2d Dept 2005] (“To maintain a cause of action to recover damages for active concealment, the plaintiff must show, in effect, that the seller or the seller’s agents thwarted the plaintiff’s efforts to fulfill his responsibilities fixed by the doctrine of caveat emptor.”)
In Laxer v Edelman, 75 AD3d 584, 586 [2d Dept 2010], the Second Department held:
New York adheres to the doctrine of caveat emptor and imposes no liability on a seller [or the seller’s agent] for failing to disclose information regarding the premises when the parties deal at arm’s length, unless there is some conduct on the part of the seller[‘s agent] which constitutes active concealment” of a defective condition (Simone v Homecheck Real Estate Servs., Inc., 42 AD3d 518, 520 ; see Daly v Kochanowicz, 67 AD3d 78, 87 ; cf. Real Property Law §§ 462, 465). Moreover, even proof of active concealment will not suffice when the plaintiff should have known of the defect (see Richardson v United Funding, Inc., 16 AD3d 570, 571 ). A plaintiff seeking to recover damages for active concealment must show that the defendant “thwarted” the plaintiff’s efforts to fulfill his or her responsibilities imposed by the doctrine of caveat emptor (Kerusa Co. LLC v W10Z/515 Real Estate Ltd. Partnership, 12 NY3d 236, 245  [internal quotation marks omitted]; see Rozen v 7 Calf Cr., LLC, 52 AD3d 590, 593 ).
Based on the arguments presented, the judge granted the motion to dismiss. The judge held that the “defendants have established that the merger doctrine bars any claims arising out of the contract, requiring dismissal of the plaintiff’s cause of action for breach of contract. In a real estate transaction, the merger doctrine provides that, once title to the property closed and the deed was delivered, any claims that the plaintiff might have had arising from the contract of sale were extinguished.”
 Section 11(c) stated: Except as otherwise expressly set forth in this contract, none of Seller’s covenants, representations, warranties or other obligations contained in this contract shall survive Closing.
Section 12 stated: Condition of Property. Purchaser acknowledges and represents that Purchaser is fully aware of the physical condition and state of repair of the Premises and of all property included in this sale, based on Purchaser’s own inspection and investigation and not upon any information, data, statements or representations, written or oral, as to the physical condition, state of repair, use, cost or operation or any other matter related to the Premises or the other property included in the sale, given or made by Seller or its representatives, and shall accept the same “as is” except as set forth herein in their present condition and state of repair; subject to reasonable use, wear, tear and natural deterioration between the date hereof and the date of Closing (except as otherwise set forth in paragraph 16(f), without any reduction in the purchase price or claim of any kind for any change in such condition by reason thereof subsequent to the date of this contract. Purchaser and its authorized representatives shall have the right, at reasonable times and upon reasonable notice (by telephone or otherwise) to Seller, to inspect the Premises before Closing.
Section 28 stated: Miscellaneous. (a) All prior understandings, agreements, representations and warranties, oral or written, between Seller and Purchaser are merged in this contract; it completely expresses their full agreement and has been entered into after full investigation, neither party relying upon any statement made by anyone else that is not set forth in this contract.
Rider at Section 12 stated: Tenancies. The purchaser herein agrees to take title to the Premises, SUBJECT TO the following tenancies: NONE. PURCHASER SHALL RECEIVE A CREDIT OF $5,000 FROM SELLER FOR THE LOWER RENT AMOUNTS & SECURITY DEPOSITS.
Rider at Section 15 stated: No representations by Seller. Seller makes no warranties or representations concerning the physical condition, work repairs, renovations, or improvements, if any, income, expenses for operation, taxes or fitness of the Premises except as specifically set forth herein. The Purchaser acknowledges that they have physically inspected the Premises prior to signing this Contract and are aware of the physical condition of the Premises and agree to take the Premises in “AS IS CONDITION” in its present physical condition. Purchaser acknowledges that the Seller has made no representation or warranties and concerning the physical condition of the Premises other than those that are specifically set forth herein. The Seller shall not be bound by or liable for any representations, oral or written, pertaining to the Premises, furnished or made by any real estate broker or salesperson, agent or employee, servant or other, unless same is specifically set forth herein. Notwithstanding, none of the representations, warranties, covenants or other obligations of SELLERS hereunder shall survive the CLOSING, except as expressly provided herein. Acceptance of the deed by PURCHASERS shall be deemed full and complete performance and discharge of every agreement and obligation of SELLERS hereunder, except those, if any, which expressly are stated herein to survive the CLOSING.
Rider at Section 22 stated: Delivery and Acceptance of the Deed. The delivery and acceptance of the deed at closing by the Purchaser shall constitute full compliance by the Seller of all of the terms and conditions of this Contract, and none of the terms and conditions of this Contract shall survive the delivery of the deed unless specifically stated otherwise.
Rider at Section 32 stated: Entire Understanding. This agreement constitutes the entire Contract between the parties. It may not be modified orally or in any other manner except by an agreement in writing signed by the parties hereto.
Rider at Section 38 stated: Property Condition Disclosure Credit. Seller will not provide to the Purchaser the Property Condition Disclosure Statement under Article 14 of the New York Real Property Law. The Purchaser agrees to the $500.00 monetary credit as set forth in section 465(a) of the Property Condition Disclosure Act. By the acceptance of a $500.00 credit, the purchaser waives any failure or misrepresentation whether of not knowing or willful on the part of the Seller. The purchase price reflected herein is net of the $500.00 given by Seller to Purchaser as a credit in lieu of Purchasers receiving a property condition disclosure statement from Sellers.
Richard A. Klass, Esq.
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Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 28th Floor, Brooklyn, New York. He may be reached at (718) COURT●ST or with any questions.
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