Tahoe home-selling tips: Ways to avoid litigation in real estate
Special to the Sun-Bonanza
Real estate has many components, many of which can provide exposure to litigation. There are many safeguards in place during the typical transaction to minimize such exposure, but things happen, people happen.
Government agencies, Federal and State, have provided many requirements for disclosure and acknowledgment by the parties, but surprises occur. Litigation generally comes from a lack of performance, disclosure matters, or property defects including title as well as physical.
If you agree to do something in the Purchase Agreement be sure that you do it. That simple advice will save you a lot of grief. Be sure when you are signing the original contract agreement that you can honor all aspects of it, or have any work you can’t do hired for completion.
If the unexpected happens, i.e., you end up in the hospital, communicate with the other side as quickly as possible and candidly. Things do happen, and when they do most people are understanding, but be advised that not everyone will work with you. Determine quickly what their position is going to be.
Disclosure is where we see the most conflict. Our motto, “When in doubt disclose!” will save you a lot of potential grief. If you have to ask if you should disclose something, disclose it. If a problem results from the disclosure, you can provide details and work through it, or cancel the transaction and count your blessings that it came up earlier rather than later. When found later, disclosure misrepresentation often leads to litigation, or, at the very least, hard feelings.
Be aware that just because an inspector didn’t find a deficiency that you are aware of doesn’t mean you don’t have to disclose it. The problem will surface at some time and if it can be proven that you had prior knowledge of it without disclosing it, you may have to pay treble damages per Nevada law on Seller disclosure. Read the Seller’s Real Property Disclosure form in detail; the last two pages are the law.
Title problems usually don’t stem from a Seller not disclosing properly since most people use a title company and obtain title insurance. Things can occur over time, however, that change things. A new neighbor can challenge what has always been done, and may have a legal standing to do so. Or not.
Be sure you know that the property you are buying has legal standing for the easements that are included with it. If not, you may find yourself defending your rights in court despite decades of continued use, by tradition and necessity.
Use of the property may be affected by CC&Rs, or county policies. If a Buyer tells you of their intended use and you know they can’t do that, be sure that you disclose you opinion to them … in writing.
Our Advice: Keep a paper or email trail of the communication that occurs during the course of your transaction and afterward. It is important to put disclosures, comments and opinions in writing and verify that you delivered it to the other party.
If you send it to your Agent then you can assume it was delivered to the other side, but it wouldn’t hurt to confirm with your Agent that it was forwarded. If you have a question along the way, reverse hats, ask yourself what you would want the other side to do if they had the knowledge or opinion that you have. It is a good way to live and will help to keep you out of trouble.
You can’t prevent the frivolous lawsuit made from spite or greed. They are rare, but they happen. Protect yourself with a paper trail and candor. It may not stop the lawsuit, but it can help the outcome.
The reasonable person will back off when presented with proper disclosure documents and look elsewhere for satisfaction.
Lisa Wetzel & Jim Valentine, CDPE, SFR, work for RE/MAX Realty Affiliates in the Carson Valley. Visit carsonvalleyland.com or call 775-781-5472 for information.