Does nondisclosure qualify as a material misrepresentation?

For the purposes of a fraud claim, nondisclosure may qualify as a material misrepresentation when a party has a duty to disclose. (See Reed v. King (1983) 145 Cal.App.3d 261, 264-265.) It is settled law in this state that the seller of real estate has a duty of disclosure: "'In the context of a real estate transaction, "[i]t is now settled in California that where the seller knows of facts materially affecting the value or desirability of the property . . . and also knows that such facts are not known to, or within the reach of the diligent attention and observation of the buyer, the seller is under a duty to disclose them to the buyer. [Citations.]" [Citations.] Undisclosed facts are material if they would have a significant and measurable effect on market value. [Citation.]'"

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