I purchased a house in March 2009. It was a private purchase, not through a realtor, a 100 yr old house that had been renovated. All the paperwork was done by a lawyer. In June 2010, I had a visit from the town's chief building inspector, who produced a long list of substandard property orders on the property. He said the orders originated with the man I bought the house from, but this was the first I heard. The seller had bought this house on power of sale, and the building inspector had advised him immediately that there were many concerns regarding the condition of the property. The seller was given the order, but didn't follow through. The building inspector told me that the seller had renovated without permits, and property wasn't up to code. I was unaware of any of this. I am now responsible for the property orders, and I've been told I have to obtain permits & inspections for all the work that was done before I bought it. Also, that I would have to remove the siding, roof, etc that was done without permits & start from scratch. I bought this house in good faith, the title search came back clean. Do I have any legal recourse? Does the seller not have to inform me of any known issues like property orders? Shouldn't the town have had to inform me and enforce these orders?

When you say that the paperwork was done by a lawyer, was it done by YOUR lawyer? Did you have one for the purchase? Was there a contract? Who prepared the contract? Did it give you the right to have a home inspection performed? Did the contract state that the seller represented that they had all permits for any work done to the home?

So was there a contract for sale, was the disclosure paper work included. Was this your attorney, or their attorney.

You need to get into a real estate attorney in the morning and let them go though all of this.

... Shouldn't the town have had to inform me and enforce these orders?

I doubt it. How was the town to know that you were purchasing it?

YOUR lawyer (not the seller's) is responsible for advising you and protecting you - to some extent. Lawyers usually ask you if you have had inspections, but I have never heard of one asking about lack of permits - how would anyone know? There are laws about disclosure. In the US, a specific disclosure form must be completed, at least in all the states I know about. You may have to sue the former owner.

What does 'good faith' mean in business transactions? There's really no such thing. You mean disclosure - the seller KNEW he was hiding pertinent facts.

I would certainly argue that, since the town failed to properly enforce the permit requirement against the previous owner, it is estopped from pursuing you. After all, you did not know of any violation and, apparently, there is no inquiry notice requirement. Take that argument to an attorney in your jurisdiction and see what he/she thinks.