House seller did not have an obligation to inform the buyer that a neighbour was a previous convict

After having signed a purchase agreement for a house, the buyers learned that a close-by neighbour had recently been convicted of sexual offences, including filming of his own step daughters in the bathroom. As a result, they cancelled the agreement. No information about the conviction had been provided during the sale, but it was well-known in the neighbourhood. The property was sold anew at a lower price, after which the sellers brought an action against the buyers claiming damages for the loss incurred in the resale. The Supreme Court found like the lower instances that the sellers did not have an obligation to inform about the conviction, see section 3-7 of the Sale of Property Act. A duty of disclosure regarding neighbours' personal affairs is only triggered if there is a real risk of acts that will directly affect persons connected to the property that is sold. Here, the neighbour constituted no real danger to persons on the neighbouring property. The Supreme Court also stated that information that a person has committed certain criminal offences are personal data of a sensitive nature. The fact that many potential buyers would want such information cannot be decisive for the scope of the seller's duty of disclosure. The cancellation was not justified, and the claim for damages was accepted.    

Read the whole judgment (Norwegian only)

Areas of law: Purchase of real property. Sections 3-7 and 3-8 of the Sale of Property Act. 

Key paragraphs: 48-50, 55-56

Justices: Øie, Normann, Bull, Arntzen, Bergh