Ohio Supreme Court rules sewer line location isn’t a ‘defect’ in property dispute

(UI) — The Ohio Supreme Court has ruled that a homeowner selling property is not obligated to disclose the presence of a working sewer line on state-required property forms, even if it limits future construction. According to the court’s decision, the existence of a functioning sewer line does not qualify as a “material defect.”

The case involved a high-value residential lot along Lake Erie in Bay Village, where a couple planned to tear down the existing home and build their “dream house.” According to reporting by the Ohio Supreme Court in Ashmus v. Coughlin, the buyers discovered after signing the contract that a public sewer line ran beneath the property, restricting where they could build.

The seller, Keith Ashmus, had disclosed on the standard Ohio residential property disclosure form that the property was connected to a public sewer. However, he left blank a section regarding “other known material defects.” The couple, Thomas and Melissa Coughlin, later claimed this omission constituted fraud.

The sewer line in question is part of the city’s underground infrastructure, in place since at least 1964, according to public records. The line’s existence was noted in easement records available from the City of Bay Village.

When the Coughlins learned about the sewer line location during their due diligence, they determined it would interfere with their building plans and backed out of the $200,000 deal. Ashmus then sold the property to another buyer for a lower price and sued the Coughlins for breach of contract, seeking damages.

A trial court sided with Ashmus, finding no concealment of defects because the sewer line was a matter of public record and did not affect the property’s current use as a home. An appellate court reversed that decision, but the Ohio Supreme Court reinstated the trial court’s ruling.

“A reasonable person might say that a sewer line had a defect if a pipe was cracked and sewage backed up,” wrote Justice R. Patrick DeWine in the court’s unanimous opinion. “But few speakers would say that a sewer line was defective if it worked perfectly but was in an inconvenient location.”

The court clarified that sellers are not required to anticipate specific redevelopment plans by buyers. Instead, disclosure obligations relate to flaws that interfere with ordinary residential use, such as structural damage or a faulty electrical system.

This ruling has implications for property transactions involving underground infrastructure, especially in cases where utility easements limit development but do not affect current use.

The decision in Ashmus v. Coughlin, Slip Opinion No. 2025-Ohio-2412, underscores the importance of reviewing public records—including utility easements and sewer line maps—during real estate transactions. For underground infrastructure professionals, the case highlights the legal boundaries of disclosure related to buried utilities.

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