Every state has different requirements for what must be disclosed when selling residential property. Some states don’t require any disclosure and some states require disclosure of facts that don’t tangibly affect the property, such as a murder or suicide. In Florida, it has always been a violation of the law to misrepresent material facts in the sale of residential property. Said another way, if you speak or make written statements about the residential property the law has always required those statements, written or verbal, to be true. However, prior to 1985 if the seller of residential property simply remained silent and didn’t disclose material defects to the property this mere nondisclosure was not a violation of the law.
How Johnson v. Davis impacted disclosures for residential property
In 1985, the Florida Supreme Court issued the Johnson v. Davis opinion which created a duty for a seller of residential property to disclose facts that materially affect the value of the property, that are not readily observable, to the purchaser. Specially, the Johnson v. Davis court held:
Accordingly, we hold that where the seller of a home knows of facts materially affecting the value of the property which are not readily observable and are not known to the buyer, the seller is under a duty to disclose them to the buyer. This duty is equally applicable to all forms of real property, new and used.
Johnson v. Davis, 480 So.2d 625, 629 (Fla. 1985)
What must be disclosed on a disclosure form
Although there is an obligation to disclose facts that materially affect the value of the residential real estate, there is no disclosure form that is required by the law. Realtors often require a disclosure form but the form itself is not required by law. In fact, many real estate brokers request a disclosure form be filled out that has more extensive disclosures than that required by law. For instance, many disclosure forms request that the seller disclose if there has ever been a water leak or if there has ever been termite damage. There is no obligation to disclose prior damage that has been adequately repaired. Spitale v. Smith, 721 So.2d 341 (Fla. 2d DCA 1998); Slitor v. Elias, 544 So.2d 255 (Fla. 2d DCA 1989); Brown v. Carter, 13 So.3d 111 (Fla. 2d DCA 2009). Real estate brokers often request prior water damage or prior termite damage on their disclosure form in an effort to protect themselves. Realtors and real estate brokers can also be liable to a buyer if a realtor knows about facts that materially affect the value of the property but fails to disclose such facts to the buyer. Syvrud v. Today Real Estate, Inc., 858 So.2d 1125 (Fla. 2d DCA 2003). A disclosure form that requests the seller to disclose prior damage is nothing more than a paper trail to insulate the realtor from liability. If prior or current defects aren’t disclosed to the realtor on the disclosure form, then it would be very difficult to prove the realtor had knowledge of any defects.
Disclosure of a homicide or suicide if it impacts the value of the property
In Florida, there is no obligation to disclose a homicide or a suicide that occurs on residential real property. Fla. Stat. 689.25. However, the only reason we know that a homicide or a suicide need not be disclosed is because the Florida Legislature passed a statute stating there is no obligation to disclose suicides or homicides. Apparently, the Florida Legislature was concerned that if this question was left for the Courts to decide that the Courts may have decided this issue differently. For instance, in California a murder in a home occurring three years before the sale must be disclosed. CCCS 1710.2. To date, Florida Courts haven’t issued any substantial legal opinions weighing in on whether an intangible defect in a home must be disclosed. For instance, if a residence used to be the headquarters of a notorious gang, or has a pet cemetery on it or was the childhood residence of a serial killer many people would not want to live on the property even though the intangible stigmas have no effect on the quality of the home. It is possible that disclosure of these intangible stigmas may even affect the value of the property. Perhaps in the future, Florida Courts will directly address whether an intangible stigma/defect must be disclosed. For the time being the only guidance we have on this point is the Florida statute that makes it clear that murders and suicides occurring on the property need not be disclosed.
What must be disclosed in Florida when selling residential real estate can be confusing. This is particularly true considering the frequent use of disclosure forms that require disclosure of things that are not required to be disclosed per Florida law. Although this article is not a comprehensive review of Florida’s disclosure law, it does provide some basic information about the current state of Florida’s law requiring disclosure of facts materially affecting the value of residential real property.
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