A California listing agent knows from personal experience that a property in Pacific Palisades is in an area that frequently experiences coastal erosion and mudslides. The NHD report does not flag the property for any of the six statutory hazard zones. The agent provides only the NHD report and does not separately disclose the erosion and mudslide risk. After closing, a mudslide damages the property. What liability does the listing agent face?
Correct Answer
B) Liability under Cal. Civil Code §2079 for failing to disclose known material facts beyond the scope of the NHD
While the NHD covers six statutory zones, the listing agent has an independent duty under Cal. Civil Code §2079 and general agency law to disclose all known material facts. The agent's personal knowledge of coastal erosion and mudslide risk constitutes a material fact that must be disclosed to the buyer, even if the NHD does not flag it. Failure to disclose this information exposes the agent to liability.
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Related Concepts
Many states and localities have fair housing laws that expand upon the protections offered by the federal Fair Housing Act.
A stigmatized property is one that has an undesirable reputation due to events that occurred on the property or nearby, such as a murder, suicide, alleged haunting, or proximity to a registered sex offender. The stigma is psychological, not physical.
An as-is clause in a real estate contract states that the buyer accepts the property in its current condition without requiring the seller to make any repairs. However, an as-is sale does NOT eliminate the seller's obligation to disclose known defects.
More Practice Of Real Estate Disclosures Questions
Under California law, a real estate agent owes a duty of honest and fair dealing to all parties in a transaction, not only to the agent's own client. Which provision most directly establishes this duty?
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A California-licensed salesperson uses the title 'Real Estate Consultant' on business cards and marketing materials without holding any special certification or designation. Under DRE regulations, this practice is:
Barnard made an offer to buy a vacant residence. The offer was accepted by the seller. Prior to the close of escrow, Barnard requested permission from the broker to enter and make minor repairs to the house. Which of the following is true?
Most common business structure for one individual:
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- → At a DRE administrative disciplinary hearing in California, what standard of proof must the Department meet to sustain a finding against a licensee?
- → The Transfer Disclosure Statement requires sellers to disclose various known property conditions under California Civil Code §1102 et seq. All of the following must be disclosed on the TDS EXCEPT:
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