The complaint alleged "fraud and misrepresentation" in the sale of the property because the sellers, Joseph and Kathleen Jacono, did not disclose the Feb. 11, 2006, murder-suicide involving the previous owners, Konstantinos and Georgia Koumboulis, in the house.
The Jaconos bought the house at a September 2006 auction for $450,000 and listed it with Re/Max Town & Country in West Chester in June 2007, court filings show.
Superior Court documents show the sellers and agents contacted the state Real Estate Commission, which affirmed that a murder-suicide was not considered a material defect under the disclosure law.
Milliken said that based on the documents she was provided, she assumed the Jaconos' brief ownership might have been foreclosure-related, and that she did not learn of the murder-suicide until after moving in in September 2007, the documents show.
In a unanimous decision this week, the justices said that despite the potential impact "a psychological stigma may have on the value of the property, we are not ready to accept that such constitutes a material defect." Moreover, the justices said, a "tragic" event in a house does not affect the quality of real estate, which is what the seller-disclosure law aims to address.
Milliken's lawyer, Timothy F. Rayne of MacElree Harvey, said Friday that he and his client "respectfully disagree with the court's decision and still feel strongly that the sellers and their Realtors should have exercised good faith and disclosed the murder-suicide."
Fox Rothschild lawyer Abraham Reich, who represented Re/Max Town & Country, said the ruling was correct. "The issue at hand is the slippery slope of allowing a psychological stigma to impact the value of a property," he said.