A seller completes a TDS for a property in Ventura County and discloses that the septic system was installed in 1990, but omits that the system overflowed last winter. The listing agent learned of the overflow during a conversation with the seller prior to listing. The buyer purchases the property and later discovers the septic history. Which of the following best describes the potential liability?
Correct Answer
C) Both the seller and the listing agent may be held liable, because each had independent knowledge of a material fact that was not disclosed to the buyer
Under Cal. Civil Code §1102, sellers are required to disclose all known material facts on the TDS. The septic overflow is a material defect the seller knew about and omitted. Separately, under Cal. Civil Code §1102.6 and the agent's statutory duty of honest dealing, a listing agent who has actual knowledge of a material fact — regardless of how that knowledge was acquired — must disclose it to the buyer. Because both parties had independent knowledge and failed to disclose, both may be held liable.
Why This Is the Correct Answer
Why the Other Options Are Wrong
Deep Analysis of This Practice Of Real Estate Disclosures Question
Background Knowledge for Practice Of Real Estate Disclosures
Real World Application in Practice Of Real Estate Disclosures
Common Mistakes to Avoid on Practice Of Real Estate Disclosures Questions
Related Topics & Key Terms
Key Terms:
More Practice Of Real Estate Disclosures Questions
All exemplify lawful private real estate controls except:
A landlord must give a month-to-month tenant how many days' notice to terminate the tenancy in California (for tenancies less than one year)?
A California apartment complex was built in 1985. A wheelchair-bound applicant applies for a ground-floor unit and asks the landlord to widen the doorways to accommodate the wheelchair. Under fair housing law, who is responsible for the cost of the modification?
A property in a California Mello-Roos district has a base Proposition 13 property tax of 1% on its assessed value of $600,000, plus a Mello-Roos special tax of $3,200 per year. What is the total annual property tax bill for this property?
A California buyer's agent conducts a visual inspection of a property and observes extensive, recently applied caulking around all window frames and along the base of the exterior walls. What is the buyer's agent's most appropriate next step?
- → A California buyer's agent conducts a visual inspection and notices that the property's water heater is not strapped to the wall as required by California law for seismic safety. Under California Health and Safety Code §19211, water heaters must be braced. What should the buyer's agent do?
- → Tenant died in apartment unit two years ago. Landlord discloses death to prospective tenant, mentioning AIDS-related cause. Which statement is correct?
- → A homeowner in a California Mello-Roos district wants to pay off the remaining Mello-Roos bond obligation on their property. The outstanding principal balance of the bonds allocated to the property is $35,000, and the CFD charges a 3% prepayment premium. What is the total payoff amount?
- → Under California's Mello-Roos Community Facilities Act, special taxes levied within a CFD may fund all of the following EXCEPT:
- → A buyer in Los Angeles asks her agent about the difference between the TDS and the NHD. Which statement BEST explains the distinction?
- → Consider a prepaid rental listing service that intends to relocate. When is the listing service required to provide notice of the new address and telephone number to its clients?
- → In California, the Transfer Disclosure Statement (TDS) must be provided by:
- → After smoking, this is the second leading cause of lung cancer. A naturally occurring gas that forms in rocks, soil, and water:
- → Broker discovering defect before settlement must:
- → Under California law, sellers must disclose earthquake risks for homes built before:
People Also Study
Buyer Representation Agreement
8% of exam
Property Ownership
10% of exam
Land Use Controls and Regulations
8% of exam
Valuation and Market Analysis
10% of exam
Previous Question
A listing agent in California is preparing to complete the agent visual inspection section of the TDS for a property in Stockton. The home has a locked crawl space under the house that is not accessible without tools. Under Cal. Civil Code §2079, is the agent required to inspect this crawl space?
Next Question
Under California law, the listing agent has a duty to conduct a visual inspection of the property and report findings on the TDS. All of the following are within the scope of the agent's visual inspection duty EXCEPT: