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Stuart,
Sellers need to disclose any issues they know about the home which will affect the value and the safetly of the new owner. Depending on what state you live in, sellers usually compete a Transfer Disclosure Statement. If the seller intentionally knew about it and failied to disclose it, they are liable. If I was you, I would contact a local real estate attorney.
There could be more issues with the property and you have not yet found out about. Did you hire an home inspector before buying?
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