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Court rules on Scottsdale sex offender real estate issue

PHOENIX -- A state appellate court says Arizona law bars lawsuits against home sellers who don't disclose that a sex offender lives next door, but the ruling also says providing a false reason for selling is another story.

The ruling revives a fraud claim against the sellers of a Scottsdale home. The sellers had told the buyers that they were selling because they wanted to be closer to friends. However, their real reason allegedly was the sex offender next door.

A trial judge dismissed the entire suit, and the Court of Appeals' recent rules agreed with dismissing a claim of negligent misrepresentation.

However, the ruling said the buyers' fraud claim can proceed because it's up to a jury to decide whether the buyers relied on the sellers' allegedly false statement.

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