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The purchase agreement stated that Hagan had never lived in
the house and that he made no warranties as to the condition of
the house or whether it was habitable, or in compliance with code
or laws.
2. Petitioners' Move to Spokane
Petitioners rented moving equipment from U-Haul several
times in July 1989 to move some of their furniture and personal
belongings to the W. 22d property. Petitioners sold their home
in Moscow on August 4, 1989, for $150,000. Around that time,
petitioners and their son moved from Moscow to the W. 22d
property. Petitioners took possession of the W. 22d property by
early August 1989. Petitioners did not have a residence in
Moscow after August 4, 1989.
The W. 22d property needed a lot of work when petitioners
moved into it. Petitioners were responsible for maintaining the
W. 22d property after they moved in. They made various repairs
to the property in July and August 1989.
3. Title Dispute Over the Spokane Property
Shortly after signing the purchase agreement, petitioners
learned that Hagan could not deliver clear title by the closing
date (June 19, 1989) because a third party, Riner E. Deglow
(Deglow), claimed that his chapter 7 bankruptcy estate possessed
an interest in the W. 22d property.
On November 30, 1989, petitioners, Hagan, and Deglow's
chapter 7 trustee in the bankruptcy proceeding, Joseph A.
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