Moth-infested mansion highlights the risks of misrepresentation

When selling a property, full and honest disclosure isn't just expected—it's a legal requirement. A recent High Court ruling has reinforced this, following a dispute over a luxury London home plagued by a severe moth infestation. The case is a stark warning to sellers: failing to disclose known issues can lead to significant financial and legal repercussions.

The hidden infestation that led to a legal battle

In 2019, Iya Patarkatsishvili and her husband, Dr Yevhen Hunyak, purchased Horbury Villa, a £32.5 million mansion in Notting Hill. The seven-bedroom home boasted every high-end feature imaginable, including a pool, spa, and cinema. But after moving in, the couple discovered a severe moth infestation.

The pests were everywhere—on clothes, food, and even on their children's toothbrushes. At its worst, Dr Hunyak reported swatting around 100 moths a day.

Investigations revealed that the property's wool insulation had long been a breeding ground for moths. Despite previous treatments, the problem persisted. However, the seller, a luxury property developer, dismissed the infestation as minor and did not disclose it during the sale.

What is misrepresentation in property sales?

Misrepresentation occurs when a seller provides false, misleading, or incomplete information that influences a buyer's decision. This can be through written statements, verbal assurances, or omissions in responses to pre-contract enquiries.

There are three types:

• Fraudulent misrepresentation – When a seller knowingly provides false information or conceals a material defect.
   
• Negligent misrepresentation – When a seller makes a statement without verifying its accuracy.
   
• Innocent misrepresentation – When a seller provides incorrect information but had reasonable grounds to believe it was true.

If a buyer can prove misrepresentation, they may be entitled to compensation, a price reduction, or even a sale reversed. 

What the court decided

The legal dispute centred on whether moths counted as "vermin" and whether their presence should have been disclosed. The seller argued they were not a serious enough issue to be declared in property enquiries. The court took a different view.

The judge ruled that moths are vermin in property transactions and that failing to disclose a known infestation amounted to misrepresentation.

The sale was rescinded, meaning the seller was ordered to refund the buyers minus an adjustment for their time in the property. Patarkatsishvili and Hunyak were also awarded £4 million in damages to cover stamp duty, ruined possessions, and other costs.

What this means for sellers and buyers

This ruling makes it clear that sellers cannot downplay or conceal known issues. Whether it's structural defects, pest problems, or anything else that could affect a buyer's decision, full disclosure is required. Sellers who fail to do so risk legal action, financial loss, and reputational damage.

For buyers, the case highlights the importance of due diligence. A thorough survey, specialist inspections, and clear legal advice can help identify hidden problems before signing contracts.

A reminder that honesty is essential

Misrepresentation in property sales is not just a legal risk—it can be costly. If a problem exists, sellers are better off addressing it before a sale than facing the consequences in court.

For buyers, due diligence is just as important. If something seems unclear or too good to be true, asking the right questions before committing to a purchase can prevent serious issues later.

A thorough property survey, clear responses to pre-contract enquiries, and expert legal advice can help uncover potential risks. If in doubt, always consult your conveyancing solicitor to ensure you fully understand the property before proceeding.