You can sue the previous owner for fraud, which is the intentional misrepresentation or nondisclosure of a material fact made with knowledge of its falsity and with the intent to induce your reliance upon which you justifiably relied to your detriment.In other words, you would not have purchased the house had you known of the encroachment.Your damages (monetary compensation you are seeking in a lawsuit for fraud against the previous owner) would be either the benefit of the bargain or your out of pocket loss.Benefit of the bargain means a defrauded purchaser may recover the difference between the real and represented value of the property regardless of the fact that actual loss suffered might have been less.Out of pocket determination of damages for fraudulent misrepresentation permits recovery of the difference between the price paid  and actual value of the property acquired.