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2026-09-25

Liability for non-conformity after you sell ― what someone selling an inherited family home should settle in the disclosure form and the exemption clause

If a leak or termites are found after you have sold and handed over a house, what is the seller liable for? This article explains \"liability for non-conformity with the contract\" (契約不適合責任), created by the 2020 Civil Code reform: the four things a buyer can claim, the notice period, the exemption clause individual sellers use, and the situations where that clause does not work, using the actual figures from a consultation about selling an inherited family home.

About this translation ― This page is an English translation of an article originally written in Japanese by KuraLab's operator, a licensed real-estate transaction specialist (宅地建物取引士) and administrative scrivener (行政書士) in Japan. The Japanese original is the authoritative text; where the two differ, the Japanese version prevails. The article explains Japanese law and procedure in general terms as of the date shown. It is not legal, tax or immigration advice for your situation ― please confirm with a licensed professional in Japan. Japanese terms are kept in parentheses so you can search for them. Read the Japanese original

"The contract says I'm exempt, so it's all right, isn't it?" The woman in her sixties who came for advice put a copy of the sale contract on the desk and said that. She had sold the 40-year-old family home she inherited to an individual buyer for 18,000,000 yen, and handed it over two months earlier. Last week the buyer had been in touch. The floor under the bathroom was rotten, and there were signs of termites. Repairs would cost 1,500,000 yen, and the buyer wanted her to pay. The special terms section of the contract said, "The seller bears no liability for non-conformity with the contract." After the contract, I asked to see one more document: the "disclosure form" (告知書) the woman had filled in when she sold.

When a defect is found after a house is sold, the liability the seller bears is called "liability for non-conformity with the contract" (契約不適合責任). The Civil Code reform of April 2020 changed its name and its approach from the earlier "warranty against defects" (瑕疵担保責任). When what was handed over does not match the contract in type, quality or quantity, the buyer can ask the seller for four things: to fix it (a claim for cure), a discount to match (price reduction), payment for loss (damages), or to end the contract (cancellation). The important point is that the test is no longer "whether it was a hidden defect" but "whether it matches the contents of the contract." In other words, the conclusion changes depending on what was written in the contract and the disclosure form.

There are also rules on time limits. Under the Civil Code, if the buyer does not notify the seller within one year of learning of the non-conformity, in principle they can no longer claim. But where the seller knew of the non-conformity at handover, or did not know through gross negligence, this time limit does not apply. Where the seller is an individual, a special term can shorten the period or exclude liability. In private sales of second-hand houses, a term limiting claims to "those notified within three months of handover" is common. On the other hand, where the seller is a real estate company (a licensed real estate business, 宅建業者), any term unfavourable to the buyer is void, except one setting the period at two years or more from handover.

So how far does the "no liability" term in the woman's contract go? The Civil Code provides that even with a term excluding liability, the seller is not released from liability for facts they knew of and did not disclose. The seller of an inherited family home often does not know how worn the house is, because they did not live there. That is why exemption clauses are used. And for the same reason, writing down in the disclosure form "what you did know" is the seller's best protection.

Defects the exemption clause covers and defects it does not: the dividing line is "whether the seller knew." From the disclosure form and the exemption clause in the contract, the path splits two ways. On the left, defects the seller did not know about: the exemption clause works, and the seller is not liable. On the right, facts the seller knew and did not write in the disclosure form: even with an exemption clause, the seller is not released from liability (Civil Code Article 572). For things you do not know about in an inherited house, writing "unknown" is enough. You land on the right-hand side when you "knew, but wrote none."

The disclosure form, which some estate agents call a "property condition report" (物件状況報告書), is filled in by the seller after the brokerage contract is signed. Leaks, termites, faults in water and drainage pipes, tilting of the building, boundaries and encroachments, noise and neighbourhood circumstances, past repairs. Alongside it, in the "list of fixtures and equipment" (付帯設備表), you write whether there are air conditioners and a water heater and whether they work. There is one trick to filling it in: write "unknown" for anything you do not know. Do not leave a blank. Do not write "none" on a guess. For an inherited house, a row of "unknown" is normal, and nothing to be embarrassed about.

Another tool is a building condition survey (建物状況調査, inspection). A professional such as an architect visually examines cracks in the foundations and outer walls, traces of leaks and the state under the floor. Since April 2018, estate agents have had to state, when signing the brokerage contract, whether they can introduce a company that does this survey. It costs from tens of thousands of yen, and if the wear is found before selling, you can write it in the disclosure form and factor it into the price.

Back to the woman's disclosure form. In the "termite damage" box, she had written "none." When I asked her about it, among her father's belongings was a receipt for anti-termite work under the floor that he had had done 15 years earlier, and she had seen it while clearing the house. "I don't know whether there was damage. But I did know the work had been done." This was the dividing line.

What the woman knew about was the anti-termite work 15 years earlier; she did not know of the rot under the floor this time itself. But writing "none" was a guess, and the box should really have said "anti-termite work done in the Heisei era (1989 to 2019). Whether there was damage is unknown." It left room for it to be said that she knew and did not disclose. What I can do in my position, as a licensed real estate transaction specialist (宅建士), is set out how to read the contract documents and the disclosure form. I told her that a dispute with the buyer would be the territory of a lawyer, and recommended first talking it through with the estate agent acting as intermediary.

The talks took a month. The buyer's claim was 1,500,000 yen: 900,000 yen for repairing under the floor, 200,000 yen for anti-termite treatment, and 400,000 yen for taking apart and restoring the bathroom. The outcome was that the woman would bear the 200,000 yen anti-termite treatment and half of the floor repair, 450,000 yen, 650,000 yen in total. Taking apart and restoring the bathroom was a part the buyer had already planned to renovate, so it fell on the buyer. The written agreement was exchanged after being checked by a lawyer the woman engaged.

How the buyer's claim of 1,500,000 yen was split in the talks (this article's example). Repair under the floor: claimed 900,000 yen; the woman (seller) 450,000 yen, the buyer 450,000 yen. Anti-termite treatment: claimed 200,000 yen; the woman 200,000 yen, the buyer 0 yen. Taking apart and restoring the bathroom: claimed 400,000 yen; the woman 0 yen, the buyer 400,000 yen (renovation was already planned). Total: claimed 1,500,000 yen; the woman 650,000 yen, the buyer 850,000 yen.

What if she had written in the disclosure form "anti-termite work done; whether there was damage is unknown" and had the underfloor area looked at when putting the house on the market? If she had sold it with the wear known and a discount of around 300,000 yen, the buyer would have bought it knowingly, and it would be hard to say it "does not match the contents of the contract." In exchange for 18,000,000 yen becoming 17,700,000 yen, I think it is highly likely there would have been no 650,000 yen payment and no month of dispute.

I will also note how to move first when the buyer gets in touch. Do not panic and say "I'll pay." But do not brush it off with "I don't know anything about it" either. First, ask for photos of the defect and a repair estimate, and contact the estate agent who handled the sale. Next, check whether the contact came within the contract's notice period. The woman's contract said "within three months of handover," and the contact came in the second month, so it was within the period. Then, if possible, see the site with your own eyes. The woman said that seeing the photos of the underfloor area reminded her of the receipt for her father's work.

How fixtures are treated is also often settled separately in the contract. For fixtures such as the water heater, air conditioners, extractor fans and cooker, you often see a short period like "repairs only for faults reported within 7 days of handover," or wording such as "these are old fixtures, so the seller bears no liability." Disputes where a fixture marked "present, no faults" on the list of fixtures failed to work the day after handover are not unusual. For fixtures you are not sure work, write "unknown" or "may not be fit for use" here too.

Three things to do before selling. One: look through the belongings for records of repairs (receipts, warranties, construction contracts). Two: in the disclosure form, write what you know down to the year and the details, and write "unknown" for what you do not know. Three: read the exemption clause and notice period in the contract, and check with the estate agent what is excluded. Boundaries are covered in the article on settling boundaries, disclosure for a house where someone died in the article on disclosure items, and the whole selling process in the article on how selling works.

As she left, the woman said, "I thought 'exempt' meant you were exempt from everything." What an exemption clause protects is only what the seller "did not know." What you know, write down. That is the cheapest way to protect yourself after the sale.

Written by: 長澤 湊（licensed real-estate transaction specialist, administrative scrivener, assistant surveyor）　Content checked on: 2026-10-24

This article is a general explanation of Japanese rules and procedures, not advice on an individual case. Figures and rules are as of the date shown. For your own situation, consult a lawyer, judicial scrivener, tax accountant or administrative scrivener in Japan.

Official sources

The rules and figures in this article can be checked against the following official pages (in Japanese).

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