In the case Johnson v. Baum, Eric Johnson bought a home from David and Norma Baum in Des Moines, Iowa. The terms of the purchase contract provided that Baum had the duty to disclose any material defects in the property about which they knew or should have known, to Johnson.The contract went on to say that if Baum breached this duty to disclose and Johnson prevailed in a lawsuit, Baum would be liable for Johnson's "reasonable attorney fees." As part of the transaction, Baum provided Johnson with a form "Seller Disclosure of Property Condition and Lead-Based Paint Disclosure" that expressly stated it was intended to satisfy Baum's duty to disclose defects to Johnson under Iowa law. After the transaction closed, Johnson had problems with water in the basement o...
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