What they didn’t know (a title search apparently missed the document) was that a 1979 agreement between former owners and the city placed sole responsibility for repair and maintenance on the owner of the property, not the local government.
They also didn’t know that the dam had been inspected in 1993, 1997, and 1999 and each time issues were raised by the division of water resources regarding the improper maintenance of the dam, and the need for immediate repairs. The city had the power to make the repairs and bill the owners back in the 90’s, but they chose not to do so.
Now the new owners are faced with a huge repair bill they can’t pay, a title insurance insurance policy that will likely only cover up to the value of the home ($330,000), and they uncovered the problem just 3 months after purchasing the property. It’s a bum situation, and I expect we could end up seeing several lawsuits come out of this.
But what about the agents that were involved in the transaction? Although the article does not mention them specifically, the reader comments are particularly harsh in their assessment of the Realtor’s role (or lack thereof).
Let’s assume for a moment that there WAS a Realtor involved in the transaction. I’d be willing to bet that they probably had little experience in selling homes with a dam on the property (It’s not a typical feature, right?), but inexperience does not give us a pass on responsibility. Whether working as a buyer or seller agent, we need to be able to ask those questions and protect both our clients and ourselves from a situation such as this. Just because the title company missed the city agreement doesn’t mean that they’re the only ones responsible. You could create a laundry list of culpable parties on this one!
The bottom line here is that we as Realtors need to be able to insulate our clients (and ourselves) from situations such as this. If necessary, don’t be afraid to spend some time at the local courthouse or health department researching property documents. If you’ve ever dealt with land transactions then you’ve probably already done this, but it’s a crucial step with any property that you think might have unusual or odd variances. Look at it this way: Is it worth you license or life savings to have missed something like this? I think not.
photo courtesy of Alan Light via flickr cc
