Presentation on theme: "Common Legal Questions and Answers Blake Hegeman VAR Legal Counsel."— Presentation transcript:
Common Legal Questions and Answers Blake Hegeman VAR Legal Counsel
Advertising What are my disclosure obligations for online and print advertising?
Advertising Online ads for a firm must have: Firm name; City and state of main office; and All jurisdictions in which the firm is presently licensed Online ads for a licensee (not a firm) must have: Licensee’s and firm’s name; City and state of the licensee’s office (not necessarily firm’s main office); and Jurisdiction(s) in which licensee holds a license, active or not. For all other ads, the requirement is simply this: The firm’s name must be clearly and legibly displayed. No address, states of licensure, phone, etc. — just firm name.
Disclosure What are material adverse facts pertaining to the physical condition of the property?
Disclosure The Code of Virginia obligates listing agents to disclose to prospective purchasers all “material adverse facts pertaining to the physical condition of the property which are actually known” by the listing agent. Material. Something is material if it could affect the decision of a reasonable person about whether to buy. Adverse fact. Contrast this with “defect.” The difference may be along the lines of polybutylene pipes and fittings that haven’t leaked yet. Their existence is probably an adverse fact (buyers will want to check it carefully, especially the fittings) but not a defect if everything is properly functioning now. In short, at least consider that “adverse fact” may be more broadly construed than “defect.”
Dislcosure Pertaining to the physical condition of the property. The statute provides that “the term ‘physical condition of the property’ shall refer to the physical condition of the land andany improvements thereon, and shall not refer to: (i) matters outside the boundaries of the land or relating to adjacent or other properties in proximity thereto, (ii) matters relating to governmental land use regulations, and (iii) matters relating to highways or public streets” (section 54.1-2131B). Actually known by the licensee. When do you actually know something? First, remember that only material issues are subject to the obligation to disclose. Remember that receipt of the entire inspection report probably imposes a duty to read it and decide what is and is not material. It may also be at odds with a prior report, and may be prepared by a high-strung inspector. With dueling inspectors, try to put the two together, which resolves a large majority of all conflicts. If the two still don’t agree, a third opinion may be necessary.
Defective Drywall Licensees shall treat all prospective buyers honestly and shall not knowingly give them false information. A licensee engaged by a seller shall disclose to prospective buyers all material adverse facts pertaining to the physical condition of the property which are actually known by the licensee. If a licensee has actual knowledge of the existence of defective drywall in a property, the licensee shall disclose the same to the prospective buyer. For purposes of this section, "defective drywall" means all defective drywall as defined in § 36-156.1. As used in this section, the term "physical condition of the property" shall refer to the physical condition of the land and any improvements thereon, and shall not refer to: (i) matters outside the boundaries of the land or relating to adjacent or other properties in proximity thereto, (ii) matters relating to governmental land use regulations, and (iii) matters relating to highways or public streets. Such disclosure shall be made in writing. No cause of action shall arise against any licensee for revealing information as required by this article or applicable law. Nothing in this article shall limit in any way the provisions of the Virginia Residential Property Disclosure Act (§ 55-517 et seq.).36-156.155-517
Disclosure As a listing agent do I have to disclose that someone has been murdered in the house?
Disclosure The Code of Virginia makes clear that licensees are not obligated to disclose whether a property was the site of a homicide, suicide, felony, or other act having no effect on the improvements. However, because neighbors will talk, the listing agent and seller should consider getting this information to the buyer in their own way. Agent may not disclose whether previous occupant had HIV or AIDS.
EMD I am the buyer’s agent and holding the EMD. The deal has fallen through because the seller has clearly defaulted; may I release the EMD to my client even though the seller won’t sign a release of the funds?
EMD No. A licensee holding the EMD is bound by the Virginia Real Estate Board’s regulations that provide, in a nutshell, that you may not disburse without either the written consent of both the buyer and seller, or a court order. This is because the party holding the EMD is an escrow agent, and escrow agents are bound not by their affiliation to one of the parties but to the faithful handling of the money entrusted to them.
Compensation My agent left the firm before the deal closed. Can I pay her when the deal closes? Can I pay her directly?
POA Does delivery of the POA packet to the buyer agent start the three-day rescission period?
POA Yes. Delivery to the agent constitutes delivery to the buyer unless specific instructions are provided to the contrary.
POA The seller requests that my buyer client waive his right to receive a POA packet. Is that legal?
POA The POA Act makes clear that buyers may not waive their rights under the Act, even by written agreement.
Contracts What is the difference between terminating and releasing a contract?
Contracts Termination is generally the unilateral act of a party declaring the contract at an end. A termination does not rely upon the agreement of the other party but is a unilateral act.
Contracts A release is a mutual act of the parties by which one or more of the parties are released from obligations under the contract pursuant to whatever agreements the parties have reached.
Agency Law –Provide written agency and brokerage agreements to consumers; (Effective 2012) –Provide a list of services that the agent will provide to customers; (Effective 2012) –Provide a schedule of fees that will be associated; (Effective 2012) –Provide enhanced disclosure of limitations on what a Dual Agent can and cannot do for parties to a transaction. There are exceptions for commercial agents and independent contractors. (Effective 2012) –Take a 3-hour course on the provisions of the Agency statute and the changes made in the legislation. (Course must have been completed for first license renewal after July 1, 2012)