Yes…the listing agent is obligated to disclose anything they know about the property, but what makes you think they were aware of it when the home inspector did not catch it?
Completely my opinion, but I would be thankful that your home did not flood like your neighbors did and that whoever did it took steps to remedy the situation.
Let me get this straight…you signed documents stating you were all right with the property “as is”, but now your upset with how the property “is”?
If it were me…it would not be worth it, but I am a very lawyer averse person. It might be worth mentioning that you could have had another agent represent you in the transaction if you did not trust the listing agent, but you chose to go with the listing agent and that is why they received the buyers side of the commission.