James owned real estate.He leased the building to two tenants.An insurance agent leased the first floor and a law firm leased the second floor.James sold the land to Mary,who used the entire building for her business.She discovered that there were underground storage tanks buried in the land.She had to remove the tanks and then sued James and the former tenants for the cost of removing the tanks,even though none of them knew the tanks had been there.In this situation:

Question

Quizplus · Accepted Answer

James is liable to Mary because he sold her a property with hidden defects, i.e., the buried storage tanks. The tenants, however, are not liable because they were not aware of the tanks and had no obligation to inspect the property for potential hazards. Therefore, only James is liable for the cost of removing the tanks.

James Owned Real Estate