Stambovsky v. Ackley

Citation. 169 A.D.2d 254, 572 N.Y.S.2d 672, 1991 N.Y. App. Div.

Brief Fact Summary. The Plaintiff, Stambovsky (Plaintiff), brought suit to rescind a contract to buy a house after he discovered the house was purported to be haunted, thus lowering its value.

Synopsis of Rule of Law. A condition that impairs the value of property, known to the seller and left undisclosed to the buyer can constitute a basis for rescission of the contract.

Facts. The Plaintiff moved to a new neighborhood where he contracted to buy a house. The Defendants, Ackley and a real estate agency (Defendants), knew the house they had just sold to the Plaintiff was haunted. This was a widely known fact in the area and the house had even received national press attention. After Plaintiff discovered this, he sued for rescission. The trial court dismissed his complaint.

Issue. Whether an undisclosed condition that impairs the value of the property is a basis for rescission of the contract.