3 beds, 2 baths, but who’s next door?

An Ontario judge recently concluded that sellers may have such a duty, giving the green light to a lawsuit that raises intriguing questions about honesty in real estate and the treatment of some of society’s most reviled criminals.

Jason Dennis and Rebecca Bound launched the suit over a house they bought in Bracebridge last June, only to be told later that a neighbour opposite them had been found guilty 10 years earlier of possession of child pornography -a fact they allege was well-known to everyone in the suburban enclave, including the sellers.

In a ruling this spring, Justice Alexandra Hoy rejected a motion by the defendants to dismiss the suit, saying it was not “plain and obvious” the case would fail. The couple have two children, a girl aged three and an 18-month-old son, and vowed never to move in after one of their new neighbours told them last June about the middle-aged man who had arrived on the street in 2007.

While they had no direct evidence the individual would pose a danger it was not a risk they wanted to take, especially since Mr. Dennis is often away at night working as a firefighter, Ms. Bound said in an interview Wednesday. “Both children’s bedrooms face him at the front of the house,” the mother said. “Our son could be running through the sprinkler in the front yard. Maybe my daughter wants to ride a bike outside in a couple of years … Are we ever going to feel comfortable having them out of our sight?”

The couple decided to move from west-end Toronto to a cheaper home in Bracebridge after Ms. Bound took an extended leave from her teaching job to better care for their son, born with a cleft lip and palate. They bought a split-level home on a spacious, well-treed lot in the cottage-country town for $253,000 and knew nothing might be amiss until they took possession on June 14, she said.

As the public cannot access sex-offender registries in Canada, they had to hire a private investigator to confirm the neighbours’ reports, who told them the man was convicted in 2001 and pardoned six years later.

Under real estate law and the principle of caveat emptor -buyer beware -a seller is not obliged to disclose information about a property that a reasonable inspection would detect. If they are aware of a “latent,” or hidden, defect that renders a house unfit for habitation or dangerous, however, they may be required to tell the purchasers, Judge Hoy noted in her decision.

Ms. Bound and her husband argue that a nearby presence of a sex offender would constitute just such a hidden defect. William and Helen Gray, the sellers, reject that notion, though, and also maintain in their statement of defence that they had no idea the man may have had a sex-offending past.

Arnie Herschorn, the buyers’ lawyer, conceded that the suit stretches the current law, but suggested it is not so different than the case of the house four doors down from a property contaminated with radioactive material, a scenario the courts did accept as a hidden defect.

Ms. Bound said she has been told the case is already causing a buzz in the real estate world, with many agents now feeling they should disclose such information if they learn of it.

That prospect is worrying to Catherine Latimer, executive director of the John Howard Society of Canada, who said maintaining some anonymity is often crucial to sex offenders being successfully rehabilitated. “They’ve paid their debt to society. You’re creating an ongoing incapacity for them,” she said. “They’re continuing to pay a penalty, even though they’ve discharged their sentence.”

The couple have had the house up for sale, disclosing their concerns to potential buyers, and received an offer this week from a family that was unconcerned about the situation, said Ms. Bound. She said they would end up taking a loss on the sale, however, and aim to recoup that sum through the lawsuit.

tblackwell@natinalpost.com