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This is an overview of the developments covered in the Legal Pulse Newsletter for the third quarter of 2018. This summary covers Agency, Property Condition Disclosure, RESPA, Technology, Third Party Liability issues.

1. Agency: Agency issues are reviewed every quarter. During the third quarter of 2018:

  • In a Michigan case, Buyers alleged licensee of real estate company made specific representations that the garden lot was included in the transaction which was later found to be excluded. The Court awarded the buyers $100,000 in damages. (No. 340713)

2. Property Condition Disclosure: Property Condition Disclosure materials are reviewed each quarter. In the third quarter:

  • A North Carolina appellate court dismissed a buyer’s claims for failure to disclose faulty septic tank, as buyer could not prove detrimental reliance. (No. COA18-147).

  • Oregon modified its Seller’s Property Condition Disclosure Statement to include a disclosure regarding seismic risk. Sellers must indicate whether the house was constructed before 1974 and whether the house has been bolted to the foundation. (Or. Rev. Stat. § 105.464).

3. RESPA: RESPA is also reviewed each quarter. In the third quarter:

  • A Georgia court dismissed as time-barred a borrower’s allegation that the lender violated RESPA by failing to disclose that it would gain a financial benefit from the borrower’s loan, this misrepresentations being designed to create a windfall. (No. 1:18-cv-00248).

4. Technology: Technology issues are examined on an annual basis. Over the past twelve months:

  • A Fifth Circuit case held the licensee liable copyright infringement claims in connection with a licensee use of copyrighted photographs in property listings. (No. 17-50046).
  • A Kansas court held a real estate representative liable for false wiring instructions where an unknown party intercepted an email and altered the wiring instructions sent to purchasers. (No. 16-2326-JWL).

  • Multiple states passed laws pertaining to protection of personal information and security breach notification. (C.R.S.A. § 6-1-713; C.R.S.A. § 6-1-716; LA Rev. Stat. § 51:3074).

5. Third Party Liability: Third Party Liability authorities are also reviewed on an annual basis. Over the past twelve months:

  • In a Tennessee case, a house guest brought an action against home inspector following an injury resulting from the house’s second story deck collapsing. The court held that home inspector did not owe or assume duty of care toward guest, and thus home inspector was not liable for performing allegedly negligent inspection. (No. M2014-01961-SC-R11-CV).

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State Law Based Changes

NAR's State Law Based Changes is a compilation of new types of laws collected over the past few years. This resource is helpful to guide states that may want to adopt similar laws in their state.

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Read a summary of this quarter's additions to the State Law Based Changes.