Selling Haunted Houses

Question:Do I have to tell a buyer if my house is haunted when selling in Ontario?

Answer:In Ontario, a seller should disclose latent defects that could make the home dangerous or uninhabitable, but a mere rumour that a property is haunted is less likely to trigger liability if it is not supported by evidence and is not framed as a material, undisclosed fact.  That said, statements that could stigmatize the property can create dispute risk, so Paladin LLP recommends careful, complete disclosure and avoiding casual or unverified claims, while documenting what was shared before closing.  For guidance tailored to your transaction, contact (289) 925-1572 to speak with a paralegal at Paladin LLP in Ontario.

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Is a Seller Legally Required to Tell a Buyer That a House Is Haunted?

While It Is Unlikely That a Lawsuit About Whether a House Is Haunted Would Succeed In Court, It Is Always Best That a Seller Provides Full Disclosure to a Buyer and Then Refrain From Stating Anything That May Stigmatize a Property.

Note: Please contact Paladin LLP by phone at: (289) 925-1572 to discuss any specific questions that you may have.

Understanding the Law Regarding Disclosure Obligations When Selling a House Perceived As Haunted

In the case of 1784773 Ontario Inc. v K-W Labour Association et al, 2013 ONSC 5401, a seller was subsequently sued by the buyer when the seller spread rumours that the house was haunted and that such was a detail the seller failed to previously disclose to the buyer.  The buyer, concerned that rumours of the haunted status may cause a stigma with resulting harm in the form of reduced property values and the claim sought compensation for failing to disclosure the haunted status during the sales negotiations.

The Law

On the issue of proper disclosure within realty transactions, the law in Canada appears clear that the seller has a duty to disclose to the buyer any latent defects in the property that may pose a danger or make the house uninhabitable.  This rule was established by the Ontario Court of Appeal in the case of McGrath v. MacLean et al., 1979 CanLII 1691.

In regards to failing to disclose that a house is haunted, in the 1784773 Ontario Inc. case, it was determined that whereas the haunted house statements were made jokingly and whereas the buyer was unable to provide proof that the house was haunted, the case was dismissed.  Accordingly, whether would find a seller liable if evidence of paranormal activity was available remains unknown.  In another legal dispute regarding a haunted house, the case of Manitoba Free Press v. Nagy, [1907] S.C.R. 340, was reviewed by the Supreme Court of Canada following allegations of that a newspaper for published an article containing suggestions that a vacant house was haunted.

Summary Comment

The chances of getting sued for spreading a rumour that a house is haunted is slim, a former owner of a house should avoid spreading rumours that may adversely affect the value of the property. A seller limits the risk of legal trouble by providing proper disclosure during the selling process and thereafter keeping quiet.