Legal experts Dotson and Hicks joined us for a most unusual but relevant conversation they called, “So You Think Your House is Haunted?
The professors advised that before listing your home that you feel may be haunted, you should first consult a legal expert.
Disclosing a home’s paranormal activity when it is time to sell varies by state.
Cooley Professors Mark Dotson and Jim Hicks noted that local and state laws may affect sales of homes that individuals believe to be “haunted,” including the famous New York case, Stambovsky v. Ackley, which is the most famous or notorious case involving the disclosures of paranormal activity during the sale of a home.
Under Stambovsky, when a homeowner tells others their home is haunted, they would have to disclose this information. If a home has a reputation or is known as a haunted house, it will need to be disclosed. The house in the Stambovsky case had both the reputation and media coverage about it being haunted, to required that it be disclosed.
The "Legally Haunted House
Cooley Law Online
Episode Transcript
This is iHeartRadio's West Michigan Weekend. West Michigan Weekend is
a weekly program designed to inform and enlighten on a
wide range of public policy issues, as well as news
and current events. Now here's your host, Phil Tower.
Speaker 2 (00:17):
I'm pleased to dive into an area that we have
never done in this program. The whole idea of buying
and selling a house, especially if you suspect or you've
heard or you've read online at that house could be haunted.
You certainly don't want to sell until you get some
legal advice. It is a pleasure to welcome Coolly Law
School professors Mark Dotson and Jim Hicks. Professor Dotson practice
(00:42):
litigation law in Milwaukee, also served as an assistant District Attorney.
Professor Dotson teaches a number of classes including Torts one,
Torts two, Criminal Procedure, Equity, and several others, also joining
with US Torts our Lawsuits by the Way. Professor Jim
Hicks served as general counsel and Secretary to Kooley Law School,
(01:03):
also served Cooley and numerous other capacities. He's a member
of Cooley's Florida faculty, teaching civil Procedure, Property business organizations,
pre trial skills, That's how to become a good lawyer,
and several other courses. Professor Hicks, Professor Dotson, Welcome to
West Michigan Weekend.
Speaker 3 (01:23):
More than thanks, Phil.
Speaker 4 (01:25):
Great to have you both with us.
Speaker 2 (01:27):
The pitch came into my inbox and it was, you know,
kind of like we call something clickbait. I couldn't help,
but look at the email Tyler had sent me. The
pitch was, think your house is haunted, don't sell until
you get some legal advice. And I'd like to start
with both of you because you do teach about all
(01:49):
kinds of things related to the law. But Jim Hicks,
I'll start with you in terms of just the general
process of buying and selling a house. There are so
many things that can go wrong, especially if maybe that
property line was inaccurately or purposely misleading, or there's a
(02:10):
disclosure on the house that didn't happen that should have happened.
But Jim, most people don't buy a house with a lawyer.
I just want to have your thoughts on that.
Speaker 3 (02:19):
Yeah, that's a great point, Phil. You know, it's interesting.
Speaker 5 (02:23):
Even as a lawyer and somebody who's taught property law,
maybe I was being extra careful or paranoid, but I
always had a lawyer, you know, someone else, a friend
look over the agreement.
Speaker 3 (02:36):
And you know, I think that can be pretty important.
Speaker 5 (02:39):
It can be expensive to do it, and I understand
why you know, people don't, but you know there are
it's but it's not only the agreement that people need,
you know, the buysell agreement that people need to think about.
As you said, so many things can go wrong in
a real estate transaction. And so one of the things
that I suggest everybody do is get at a real
(03:01):
solid inspection of the property. You know, some inspectors obviously
are better than others. Some are going to do a
more cursory look at the property. Others are going to
do more of a deep dive. You know, you get
someone who's capable of understanding, you know, the engineering of
the house, the HVAC system, the electrical system, and I
(03:22):
think that can be really important. You know, you hit
another important point. If you're buying, you know, property, you
may not know where obviously where the property line is,
and you can't always judge that by where uh, you know,
shrubs are or where offence is. And if you're buying
in the country, it can be even more difficult, and
so while it's not cheap, if you have any doubts,
(03:44):
you may.
Speaker 3 (03:45):
Want to get a survey.
Speaker 2 (03:46):
Yeah, there's a really interesting case Professor Dotson and Professor
Hicks that is actually case law, the case of Stambovsky
versus Actly. Perhaps the most famous case involves involving the
disclosures of paranormal activity during the sale of a home.
In this case, and I'll help heavy walk us through it,
(04:08):
the homeowner failed to disclose the haunted reputation of a home.
I guess if the home visit during an open house
no ghoststar president, I guess, hey, you know, well, it's
not haunted now. It may have been thirty one times
in the past. This is a real case happened in
New York. Who wants to kind of lay this out
(04:29):
for us.
Speaker 6 (04:30):
I can in a way that immediately comes to mind
from a tourist point of view. I suppose it could
work its way into a breach of contract claim depending
on what representations were made when it came to contracting.
But more likely this was a misrepresentation claim Originally. When
it came to these kind of circumstances, the buyer the
seller didn't know an obligation to the buyer to disclose
(04:53):
anything could be liable if indeed there was an ask
and a representation in response to an ask.
Speaker 3 (05:02):
For example, if there had been.
Speaker 6 (05:03):
A question about whether or not the house was haunted,
and the seller was aware of the fact that the
house had been horned haunted and deny any knowledge of
any par normal activity, that would lead to a misrepresentation claim.
But normally, and originally normally in these irons length agreements
(05:25):
where people were typically on the same level the sophistication,
there would be no obligation to disclose any defects associated
with the house.
Speaker 3 (05:33):
None.
Speaker 6 (05:34):
In case, law developed over the years to kind of
address those situations and kind of provide with an eye toy,
providing some kind of remedy to buyers who were disappointed
with the house after they had purchased it. What has
now get what has developed over the years are these
(05:55):
now mandatory disclosure responsibilities, and they required with regard to
certain aspects of the property, that the seller make representations
concerning the condition of the property, like with respect to appliances,
like with respect to water, like respect to respect to
(06:17):
environmental circumstances, like pesticide and paint and iern et cetera,
and semesis, et cetera. Those larga have trumped, or so
I say, aviated the need to make representations. Otherwise you
have to make those, and the failure to accurately respond
(06:38):
to those statements or to those asks can lead to
the contract or the buyer being able to avoid the
contract altogether.
Speaker 4 (06:48):
Yeah, all right.
Speaker 6 (06:49):
It just so happens with regard to Michigan's that it
does not ask.
Speaker 3 (06:53):
About paranormal normal activities.
Speaker 6 (06:56):
So if this had occurred in Michigan and someone had
bought a house that turned out to be haunted, there
would be no obligation or no liability based on the
failure to disclose per normal activity really unless that was
specifically asked about.
Speaker 2 (07:13):
Fascinating, it's interesting that's Professor Mark Dotson also Professor Jim
Hicks with us, both of faculty at Cooley Law School.
This is a case, gentlemen, that, as I'm reading, famously
involved a collision between the legal principle. This is important
for buyers of homes to know and sellers of home
to know the legal principle. If we've all heard this
(07:35):
or should have learned this in middle school or high
school caveat emptor Latin for let the buyer beware and
the court's sense of justice and equity. There is a
legal principle Jim Hicks caveat empter.
Speaker 5 (07:49):
There is, and that was as as my friend Professor
Dotson said, that was the rule for years, that all
the burden was on the buyer. Fill to a lesser degree.
That's still true in many states. But you know, as
the legal system developed, as Market said, many states like Michigan,
(08:10):
for example, do have these comprehensive disclosure requirements.
Speaker 3 (08:14):
If you've ever bought, you know, if you've ever sold a.
Speaker 5 (08:16):
Home in Michigan, you'll see you got to go through
pages of these disclosure statements. And I think that's helpful
to buyers. I mean, it can also set a trap
in a way, should I disclose this?
Speaker 3 (08:27):
Is? Is this really a problem?
Speaker 5 (08:29):
I think it can raise a lot of questions, but
I think it gives you know, it gives buyers some comfort.
Speaker 3 (08:35):
But yeah, you know, believe it or not, there's no
duty generally to.
Speaker 5 (08:40):
Disclose paranormal activity in a house. You know, the Stambovski
case came about filed because the lady who owned the
house had created the impression that.
Speaker 3 (08:53):
The house was haunted. She had some fun with it.
Speaker 5 (08:56):
She told readers digest houses haunted, you know, which got
circulated nationally, and you know then she also advertised the house,
if you will on a walking tour of homes in
the community as Riverfront Victorian.
Speaker 3 (09:14):
Perenne with ghost close per En. Right. So the buyer
was not local.
Speaker 5 (09:22):
I guess local people didn't want to pay for a
full price for a house that came with a ghost.
But the buyer didn't know about it. And that's why
the case came about. And it's got some fun language
in it.
Speaker 3 (09:35):
You know.
Speaker 5 (09:37):
The judge said there's not a ghost of a chance
that the realtor could be sued. But as Mark said,
the buyer was allowed to rescind the agreement because the
seller had created the defect.
Speaker 3 (09:55):
But it's kind of fun.
Speaker 5 (09:56):
I mean, students kind of enjoy the case because the
judge said, we find the house is haunted.
Speaker 3 (10:01):
As a matter of law, But that was just to
allow the buyer to be.
Speaker 5 (10:05):
Able to rescind and not have the seller get her
cake of having the notoriety of owning a haunted house
and eating it too. By being able to sell the
house without that, you know, without any disclosure. But I'll
say this, I think Zillo did a survey a couple
of years ago, and believe it or not, twenty nine
percent of.
Speaker 3 (10:26):
Buyers said they were more likely to buy a home.
Speaker 5 (10:30):
If it was haunted, and only about a third of
perspective buyers said they wouldn't buy a house under any
circumstances if they thought it was haunted.
Speaker 2 (10:40):
Well, what's really interesting here is not only that fact,
but in the case of Stanbovski, which is what a
thirty four year old case in New York, that house
was actually ruled legally haunted.
Speaker 3 (10:54):
As a matter of law.
Speaker 2 (10:55):
Yeah, which is fascinating. But Mark Dotson, you're saying in Michigan,
if you knowingly sell a house that is haunted or
you believe to be haunted, there's no legal requirement to
disclose that on the disclosures like the oven no longer works,
where the oven fan no longer works, or yes, we
(11:15):
have had some minor you know, water in the basement
during storms and flooding.
Speaker 4 (11:20):
What happens in that case if you do.
Speaker 2 (11:23):
Buy a house that you later find out was haunted, well,
you need a lawyer.
Speaker 6 (11:30):
Right, if there was no let's let's let's take out
the possibility of a failure to disclose based on the
Michigan Seller Disclosure Act, all right, because there's there's really
no catch all there. Some some jurisdictions have a less
of specific items that you're supposed to address that might
(11:51):
speak to things like you just mentioned, like water in
the basement and issues with regard to the appliances, et cetera,
et cetera.
Speaker 3 (11:58):
All right, assuming that.
Speaker 6 (12:00):
There's no violation of the Disclosure Act with respect to
the disclosure actual statement. Some jurisdictions do have a catch
off any other thing that you might think that the
buyer might be interested in, any other thing that you
might consider to be material to the particular agreement, all right,
(12:21):
Michigan doesn't have such a clause. If if the only
other way there could be some potential liability is if
there was an ask of the seller of them of
the buyer, are there any paranormal activities? Are there any
other issues associated with the property that you think I
(12:41):
might be interested in? Now that that creates a potential
for lawsuit, and that lasso would be grounded in misrepresentation.
And then once we get into legal system, we got
different we got different aspects or different types of claims
that could be brought. There could be the intentional misrepresentation
claim that could lead to the seller, as Jim mentioned earlier,
(13:03):
having the opportunity to rescind the contract if they don't
want to have anything else to do with the house,
or they could retain the contract. In super damages, damages
can be reflected by or the measure of damages can
be reflected by the decrease in the market value as
a result of the paranormal activity or with respect to
and this gets into Ghostbusters the movie, we might have
(13:23):
to enlist those guys. But if they're costs associated with
remediating the paranormal activity, you can sue and try to
recover those as long along with any other emotional aspects
they're associated with living in a house.
Speaker 3 (13:36):
That has COEs.
Speaker 2 (13:37):
Yeah, in this case, in the Stambovsky case, versus actly
actually was the seller of the house, Jeff Stambovsky, as
you Jim Hicks correctly noted, was not a local and
he didn't know that the house was haunted. He was
eventually able to recover half of his thirty two thousand
dollars deposit. It was a six one hundred and fifty
(13:59):
thousand dollar house thirty five years ago. Nearly it's an
expensive house in New York. Because of the past published
reports about the home, New York appellate courts ruled as
a matter of law the house was That's where we
get into the legally haunted. I've got to ask if
someone dies in a house, which is not that abnormal
(14:21):
of an occurrence. Somebody spends their last days in hospice
care in a house, it probably happens pretty frequently. It
doesn't necessarily involve a haunting. Again, that's nothing you would
have to disclose because it's a normal part of life.
Or if a crime, here's another one. What if a
crime had occurred, a crime involving an assault or some
(14:42):
type of serious injury in a house. Is there any
legal requirement to disclose that in terms of the jurisdiction.
Leave it to the state of Michigan.
Speaker 6 (14:51):
Gentlemen, let me jump in real quick, Jim, and then
you can follow up. No, No, there isn't right now
in Michigan. However, I did have a student who came
to me one day after she performed formally poorly on
her midterm, and she tried to and I asked her,
what's the story, what's going on in your life? And
she said, well, I've got a problem with my apartment.
(15:13):
It shapes sometimes that night when my bed shakes. It
sometimes at night, and I hear these voices. I hear
these voices, a woman's voice. So we do some research
and come to find out that someone had been murdered,
a woman had been murdered.
Speaker 3 (15:27):
In that house. And it's to me in that apartment.
Speaker 4 (15:29):
Wow.
Speaker 6 (15:30):
And when she went to her landlord, he originally was
scoffed at her request to move, but eventually he was
convinced that he should allow her to move, give her
a money back, et cetera, et cetera. That does happen,
but in Michigan, there would have been no obligation under
the Michigan Failure to Disclose that or Sell a Disclosure
(15:51):
Act to disclose the fact that a crime had occurred,
or a murder specifically had occurred in that in that home,
in that apartment slash home residents.
Speaker 4 (16:02):
Jim Hicks, I'll let you pick it up from there.
Speaker 3 (16:04):
Yeah, I feel it.
Speaker 5 (16:05):
Interestingly enough, there are a number of states that you
have some disclosure requirements, you know, about things like deaths
or crime. I believe what California you have to disclose
a death on the property within three years, In Alaska
within one year. South Dakota specifically does require disclosing there's
(16:26):
been a homicide on the property.
Speaker 3 (16:28):
And then there are four or five other.
Speaker 5 (16:30):
States that say you have to disclose a death, but
only if the question is asked, which, of course gets
you into Mark's point about misrepresentation, and I think his
advice on that is really well taken.
Speaker 3 (16:44):
You know, you put your it's a different situation.
Speaker 5 (16:46):
You may not have a duty to disclose a crime
or a death or a haunting, but if you're asked,
you better not lie about it, right, because now you've
made that affirmative misrepresentation. But yeah, isn't it an interesting
there's not you can have. I guess these are called
stigmatized properties in the in the trade, and there are
(17:07):
only a few states that require affirmative disclosure without somebody
asking about a stigma, you know, about whatever it is
that has.
Speaker 3 (17:16):
Caused the property to be stigmatized.
Speaker 2 (17:18):
Yeah, it's really fascinating, gentlemen. I really appreciate the opportunity
to catch up on this. Both Professor Mark Dotson, of
faculty with Cooley Law School, also Professor Jim Hicks, a
member of Cooley's Florida faculty, teaching a civil procedure and
several other classes, both joining us in this segment on
(17:39):
only murders and hauntings in this House. I think we've
come up with a perfect name for this segment.
Speaker 4 (17:45):
Professor Dotson, Professor Hicks.
Speaker 2 (17:47):
It's been a real pleasure. Thank you for joining us.
Speaker 3 (17:50):
Thank you, Thanks Shell.
Speaker 1 (17:51):
You've been listening to iHeartRadio's West Michigan Weekend. West Michigan
Weekend is a production of Wood Radio and iHeartRadio.
Speaker 6 (18:00):
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