Help! Bought a house and now the city is coming after me for prior owner's permit issues. Palm Springs, CA

TL;DR: Bought a house three months ago from a deadbeat, and now the city is filing liens to enforce compliance with unfinished work. Now what? I'm doubtful that there's anything to get from the seller in terms of lawsuit.

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So, I bought a house in Palm Springs three months ago. Prior to closing, I pulled the permits on the property from the city, and there was no indication of any open or expired permits on the property. The seller disclosures reveal that a pool was installed during prior owner's tenure (~2 yrs), as well as an HVAC system for the casita. They checked the box that all work was completed with requisite permits. The questionnaire does not ask if the permits were finalized, however.

Flash forward three months, and I get a letter from the city alerting me that they are about to file two liens on the property. I called the building department and am informed that they are filing liens for two expired permits that were opened and never finalized. They are enforcing the code violations, which run with the land and not the owner. The first one is related to the HVAC in the casita and the other is for the pool.

I now have copies of the permits, both of which expired prior to close of escrow (and prior to entering escrow as well as prior to the disclosures) - provided courtesy of the city. There are listed contractors on the permits. One was pulled by the owner (pool) and the other was pulled by the Air Con company (HVAC).

I called the contractors. The HVAC guy sounded generally like he was hiding something, and they don't install that type of system. When I challenged him, saying his name was on the permit, he just kept saying it wasn't his problem. The pool guy was more interesting. He says that the owner pulled the permit and hired him as a subcontractor to do the excavation and gunite work, but didn't direct the job. He was irritated that they used his contractor number to open the permit, and now he's rolled into this situation. He has no idea how to get it fixed, and is basically putting this back in my lap.

The city is telling me that, in order to avoid the liens, I have to re-open the permits (roughly $500) in the next 6 days and call an inspection and then it's up to the inspector to either sign off or give me corrections that need to be made in order to finalize the permit.

The whole thing is a hot mess, and I'm worried this is going to cost me thousands that I can't recover.

I should also add that at the close of escrow, the seller had not paid property taxes in two years, which I had paid out of the escrow at closing to clear this issue. Since closing, a process server has been to the property twice to look for the seller, so my guess is they are probably in a bunch of other trouble. As a result, I don't expect there's much to recover if I pursue them legally.

What would you guys do here, friends of reddit?

submitted by /u/Laxandback
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source https://www.reddit.com/r/RealEstate/comments/dokjx1/help_bought_a_house_and_now_the_city_is_coming/