I wrote a blog yesterday that involved a New York lawsuit in which a woman devised a contorted and twisted interpretation of a provision of Code of Ethics and Standards of Practice of the National Association of Realtors (the "Code of Ethics") to support her position against a leasing agent. After having written that blog, I was looking through past issues of Realtor Magazine and stumbled across an article that was of interest. The article relates to Article 2 of the Code of Ethics that states, "Realtors® shall avoid exaggeration, misrepresentation, or concealment of pertinent facts relating to the property or the transaction." This was the same provision relied upon by the lady in the law suit although she had a completely different idea of the meaning of the clause.
The article in question specifically involved the issue of whether a Realtor should disclose a boundary line problem or fence encroachment. The subject is rather near and dear to me as some thirty + years ago when my wife and I bought our home in a then new subdivision, all of the backyards were wide
open and we were not able to enjoy our new brick patio with any privacy. We erected a stockade fence which our neighbor immediately declared to be an eyesore and proceeded to plant bushes along the fence. The bushes grew quickly and spread out quite far and wide.
When we had the fence erected, the lot markers were still quite visible and we had the fence placed on our property one foot from the boundary line. Our neighbor claimed of course that the fence was on her property and that she had every right to plant her bushes right up against our fence. To make a long story short, the neighbor moved within two years thereafter. The buyer immediately removed the bushes from against the fence and our problem was solved. No one said anything to the buyer about a possible encroachment of the fence. There were no problems at the closing that we ever heard about so I guess the buyer was not troubled by the placement of the fence.
The article did provide some insight as to what is considered top be a "pertinent fact", to-wit: “Absent a legal prohibition, any material fact that could affect a reasonable purchaser’s decision to purchase, or the price that a purchaser might pay, should be disclosed . . . if known by the REALTOR®.” The article continued by stating that, "[i]ncluded in the concept of pertinent facts is a fact that may affect “the potential purchaser’s ability to resell the property at a future date.” The encroachment of the neighbor’s fence onto the property of the listing clearly may affect what a reasonable buyer may decide to purchase in that the title to the property has some “flaw” or “cloud.” The encroachment may also affect the buyer’s ability to sell the property in the future unless the encroachment is resolved." It is and always been my position that full disclosure is the best course to follow for any adverse facts or conditions and let the parties involved if the fact or circumstance is pertinent or material to them. Everyone has their own concept of pertinent or material facts. Let the buyer make his or her own decision if a fact is pertinent or material to them and don't interject yourself into a precarious position.
The foregoing is not to be construyed as legal advice or a legal opinion. If you are in doubt about any issue realting to real estate or mortgages, seek the advice of a local, competent real estate attorney.
Image courtesy of thedeckcompany.net
Comments(8)