You said, "somebody got stabbed in the house but later on died" - so did they die on the property or did they die elsewhere?
Here is how I interpret California Civil Code Section 1710.2. Keep in mind I am not a real estate attorney and I am not an active real estate agent.
If they died on the property (in the home, on the home, in the yard, toe is on the very corner inch of the yard and rest of the body is on the sidewalk, etc.), and did not die of AIDS (like if they had AIDS, but the knife wounds killed them instead, or they didn't have AIDS at all), and this was in the last 3 years, then it needs to be disclosed.
If they died elsewhere, then they didn't die on the property and no disclosure is required. If someone got injured/hurt/fell ill, etc. on the property is not a required disclosure.
You don't have to disclose someone gets a terminal illness in the property and dies elsewhere (like in a nursing home), so you don't have to disclose if someone gets stabbed and dies elsewhere (like in a hospital, on the way to the hospital, or not on the property).
Now let's say in the past 3 years someone got stabbed in a neighbors home, and ran away from their attacker, unfortunately didn't make it and then they died on this property, then that needs to be disclosed (but not to the buyer of the property where the person was stabbed and did not die).
"D. No Disclosure Required for Manner/Occurrence of Death; Affliction of Occupant with Aids
No cause of action arises against an owner or the ownerâ€™s broker/agent (or any cooperating broker/agent) when selling, leasing, or renting real property for failing to disclose to the buyer, lessee, or renter the following:
â€¢ the manner or occurrence of an occupantâ€™s death UPON THE REAL PROPERTY if the death occurred more than 3 years prior to the transfereeâ€™s offer to purchase, lease, or rent the property; or
â€¢ that an occupant of the property was afflicted with, or died from, Acquired Immune Deficiency Syndrome (AIDS).
This controlling statute does not change the law relating to disclosure of any other physical or mental condition or disease of an occupant or the physical condition of the property. If the buyer asks a direct question concerning deaths occurring on the real property, this statute will not protect the owner or broker(s)/agent(s) from misrepresentations.
(CAL. CIV. Â§ 1710.2)"
So, if this person died on the property, bring this information to your real estate agent's attention, and if you do not want to purchase because of this death on the property, then I think you could back out and potentially get remedies per what I was reading in the below attorney's website.
See "Real Estate Contract Remedies, Contract Damages Recoverable By A Buyer", "Fraud Damages" and "Punitive Damages". If you have further questions that your real estate agent can't answer, I'd suggest you contact a real estate attorney, and perhaps that one.