Short answer. The seller bears it. Under Article 1568 of the Civil Code, where the thing is lost in consequence of its own hidden faults the vendor carries the loss. What he owes depends on whether he knew: a seller who was aware also pays damages, while one who was not returns the price with interest.
What the law says
If the thing sold should be lost in consequence of the hidden faults, and the vendor was aware of them, he shall bear the loss, and shall be obliged to return the price and refund the expenses of the contract, with damages.
Civil Code, Article 1568 — Loss From Hidden Defects. Read the full provision →
What the law says
If he was not aware of them, he shall only return the price and interest thereon, and reimburse the expenses of the contract which the vendee might have paid.
Civil Code, Article 1568 — Loss From Hidden Defects. Read the full provision →
Two outcomes, divided by what the seller knew
The article sets out both branches. If the thing sold should be lost in consequence of the hidden faults, and the vendor was aware of them, he shall bear the loss, and shall be obliged to return the price and refund the expenses of the contract, with damages. And then: If he was not aware of them, he shall only return the price and interest thereon, and reimburse the expenses of the contract which the vendee might have paid. Either way you are not left holding the loss simply because the item was already in your hands when it failed. The seller's knowledge does not decide whether he answers, only how far.
What makes a fault a hidden one
A hidden fault is a defect that already existed when the sale was made, that a buyer would not discover by the kind of inspection reasonably expected of him, and that is serious enough to render the thing unfit for its purpose or to reduce its value so much that you would not have bought it, or not on those terms. Ordinary wear, a condition you were shown and accepted, and damage arising after delivery from how the item was used, stored or maintained all fall outside. If you are a dealer or professional in the very trade concerned, more is expected of your inspection.
The causal link is what you have to establish
The provision applies where the thing is lost in consequence of the hidden faults. That link carries the claim. A fire, a flood, a road accident or a power surge that would have destroyed a sound item as readily as a defective one is not this article's case. So do not dispose of the wreckage: keep it, photograph it in place, and have it examined by someone competent to say what failed first and why. Reports from a technician, an engineer or the manufacturer, together with the service history, are usually what separates a defect that caused the loss from a loss that merely happened to a defective thing.
Proving awareness, and acting in time
Awareness is what unlocks damages, and it is rarely admitted. It is built instead from circumstances: earlier complaints about the same model, a recall, repairs the seller carried out before selling, records showing the fault was diagnosed, or the simple fact that a seller in that trade could not credibly have missed it. Note also that a clause purporting to free the seller from warranty will not protect one who acted in bad faith. Actions on hidden defects are governed by short periods that run from delivery, so write to the seller describing the failure as soon as it happens and take advice without delay.