Yoram Stein was moving and put up his house for sale. Mr. Rubin arranged to come see it.
Yoram took Mr. Rubin around the house, showing him each room.
“How large is the house?” he asked.
“The original house was 2,000 square feet,” Yoram replied. “We added three rooms with another 600 square feet.”
“Which rooms?” Mr. Rubin asked.
“We extended the east side,” Yoram said. “These are the additional rooms.”
“We are seriously considering buying,” Mr. Rubin said, after seeing the house. “We will be in touch after Shabbos, iy”H.”
The Rubins decided to purchase the house, and after some bargaining the sides signed a purchase agreement for $300,000 and set a date for the closing.
At the closing, Mr. Rubin said: “I discovered that the additional rooms are not 600 square feet, only 500. I’m not willing to pay more than $275,000 for the house.”
“But we agreed on the price of $300,000,” objected Yoram. “You saw the rooms and knew exactly what you were getting.”
“But you misled me,” argued Mr. Rubin. “You told me that the total area is 2,600 and it’s smaller than that.”
“You had ample time to verify that,” said Yoram. “You can’t raise the issue now. I made a mistake. I didn’t remember clearly.”
They decided to consult Rabbi Dayan.
“Yoram overstated the size of his house,” said Mr. Rubin. “What recourse do I have? Can I deduct from the purchase price?”
“The answer depends on the terms of the purchase agreement and local custom,” replied Rabbi Dayan. “The Mishnah and Gemara (B.B. 103b–107b) differentiate between various formulations of sales agreements.”
“What, for example?” asked Yoram.
“If a person sold a property middah b’chevel (as measured), any discrepancy must be made up or refunded,” explained Rabbi Dayan. “If he said, ‘hein chaser hein yaser — more or less, approximately,’ or simply mentioned the size and the buyer saw the property, a variance of 1/24 (4%) is considered acceptable; more than 1/24 must be made up or refunded. If he clearly demarcated the borders and the person saw the property, even a variance of 1/6 (16%) is considered acceptable. If the property was advertised and sold based on its size without the buyer seeing it, some maintain that any discrepancy is grounds to invalidate the sale, while others maintain that it is only grounds for a percentage refund” (see C.M. 218:7-15; Sma 218:27, 232:2; Pischei Choshen, Kinyanim 14:[141]).
“Shulchan Aruch concludes, however,” added Rabbi Dayan, “that where there is a clear local custom and terminology, we follow that rather than these default rules” (C.M. 218:19).
“How would all this be applied nowadays?” asked Yoram.
“Nowadays, the size of the property is often not mentioned at all in the sales contract, or is mentioned as ‘approximately,’” replied Rabbi Dayan. “Instead, the contract specifies the property’s address and the buyer sees it. This could be comparable to demarcating the borders, so that even a variance of 16% would not be cause for claim. Of course, this does not allow the seller to mislead the buyer and exaggerate the size (C.M. 231:1, 18). Furthermore, the dimensions of the property are easily verifiable through a survey or property tax records. The common practice is to require due diligence on the part of the buyer. Many contracts even state ‘as is,’ at least if claims are not stated during the contingency period.
“Thus, size inaccuracy would rarely be basis for a claim nowadays,” concluded Rabbi Dayan. “At best, the buyer might be entitled to a proportional adjustment of the cost.”