Expert: Karyn Foley - 5/31/2008

Question
QUESTION: We bought a house in 2006 listed on the MLS as a 4 BDRM home. The 4th BDRM is in the finished basement with a egress window and does have a closet.  We are selling our house because my husband is getting transferred to another state.  We listed our house with a realtor in January 2008. The listing stated 4 BDRM.  I checked the listing for our house in early May 2008 and is is listed as 3 BDRM.  We contacted our realtor and he states he was contacted by the County Inspector on April 3, 2008 ( the inspector just happens to live on our street and stated in randomly checks listings???) who stated that he could not list the house as a 4 BDRM ( " or he may have a lawsuit on his hands") because when the septic was inspected in April of 2006 it was approved only for a 3 BDRM which we were not aware of when we purchased the home. Neither party contacted us with this information for 2 months.  We are expecting our house to be listed for a 4 BDRM and the listing is changed without us even knowing. My husband talked with the inspector who stated that if we wanted to list as a 4 BDRM that we would have to add additional leech lines at a cost of 2-4 thousand dollars.  If the inspector approved the septic in April 2006 and the MLS listing for the house was dated March 2006 (prior to us buying it) who's responsibility is it to correct this? The builder, the county??  We bought this 4 BDRM house expecting to be able to sell it as a 4 BDRM.  Please Advise.

Also, we are trying to terminate the contract (unconditional withdrawl) with our current realtor and he will not agree.  We based this on the above first question, professional misconduct (changing the listing from a 3 to 4 BDRM without us knowing and without our permission, failed to provide promised services, written marketing plan is not consistent with his verbal representations, he had provided inferior quality services. Please advise.

ANSWER: Dear Sara:  While I will try to answer your questions, it should be advised to you that I cannot offer legal advice, for that you must contact an attorney.  But I can give you real estate opinions.  I am a little concerned because you are tossing about threats of law suits.  This attitude would only be construed the same way by any real estate broker with whom you may deal, be it a listing agent or some one who represents a buyer.  Buyers as well tend to avoid entering into agreements with people who discuss law suits often. It gives the impression, perhaps mistakenly, that you could be considered a problem person and buyers like to avoid problem situations whenever possible.
 If you feel there was not adequate representation when you purchased your home, and there may or may not have been, you should consult a real estate attorney who will go over your purchase documents and advise you accordingly and tell you who would be held accountable.
 While I dc not advocate changing from four to three bedrooms on your listing, I truly think that this removes your accountability or exposure as there is a potential problem for a new buyer and subsequently you as well if the buyer buys thinking it is a legitimate four bedroom home without issues surrounding that premise.
 If you are a stickler for services that should be provided, I suggest that commitments be put in writing rather than verbal.  When it is merely verbal, it becomes a "he said", "she said" type of bickering and most often leads to misunderstandings.  When you mentioned that he provided inferior quality services, you never mentioned what you meant.  You are charing him with professional misconduct which is a serious charge.  Perhaps your local board of real estate can better inform you what that means.  Most boards of real estate have a committee that addresses these types of matters, and you may be able to file a complaint that may or may not be considered serious or appropriate.
 I can certainly understand your frustration, but before you start assigning blame, you owe it to yourself to get support and direction.  I would first contact the agent from whom you purchased the home, and discuss this matter with them at a meeting along with that agent's manager or office owner.  Then, if you are not satisfied, discuss your issues with your current agent at a meeting along with that agent's manager or office owner.  I feel that you will only be ultimately satisfied by consulting with a real estate attorney as a last resort.  It may cost you some money, but you will learn if you do have a legitimate complaint against some one, who that person or agency is, and how the best way to proceed would be, either to rectify the problem, or hold them financially responsible.
 I would be furious if this same problem happened to me, especially when the market is not as strong today as it was in 2006.  You may lose money because the market is weaker,but I would hate to have you lose money also because some one did not make the mandated disclosures to you.  Yes, these types of disclosures are legally mandated in many areas, and you deserve to learn about them.  But please, try to do things calmly and efficiently. You should perhaps consider taking the house off the market until you know what direction to take.  If you do not chose to do so, then please realize that all of the details and facts in your letter to me need to be disclosed in writing to any potential buyer.
 Please let me know what you decide to do, and what happens.  This is very unsettling and I would like you get good support and guidance from the right people.  Again, it may have to be with a lawyer.
 Good luck, and please keep these matters quiet and private and just discuss them with the people who are involved.  Do not give your property a bad reputation that is not deserved.
 Karyn Foley

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QUESTION: Just to clarify. We never knew this problem existed.We did not bring up the law suit term, the health inspector made that statement to the realtor.  Why on earth would a health inspector be looking at real estate listings and contact the realtor instead of the home owner?  As I mentioned he lives on our street.  Something doesn't seem right.

ANSWER: Dear Sara: You are correct...why, indeed would he contact the agent unless he or she knew the agent personally and wanted to make certain that everyone stays out of trouble.  However, I would think that the inspector should have reported it to his or her office, and then that office would have notified you accordingly.  Unless, that is not what is done.  You should call the health inspector's supervisor and ask all of your valid questions.  Didn't you have a home inspection prior to your purchase?  Sometimes a home inspector is aware of these types of issues.  But my bet is on the listing agent, the seller, especially, for being accountable for informing you of all of this.  You really may have recourse, but it should be handled very professionally and calmly with some one who has clout:  a land use attorney.  You could also consider going to small claims court.  Find out the maximum you could sue for.  But, keep in mind, that even if you win the case, you should be advised who you should go after and winning does not guarantee collection.  There are a lot of players out there:  all of the agents involved and their office/company; home inspector; seller.  There is also an aspect of cost versus value.  If all you would be out would be four thousand dollars for making the connection, or installation you mentioned, would you recoup that much for selling it as a four bedroom?  Or, would it cost you at least that much money to sue without a guarantee that you would be reimbursed?  Many lawyers take a suit and only charge you a percentage if you recover damages, but there might still be out of pocket charges.  If you are selling your house now through the same agent you purchased the house, I would consider letting him go just because you were poorly represented when you bought.  You know, sometimes things just slip through the cracks, and they happen to be things of this nature which are troublesome, and will cost you money, but taking all of the factors into consideration, might not be worth the effort involved.  BUT GET LEGAL ADVICE!  If you do this at once, then you know if you are going to have a good shot at recovering some money, or if you should do whatever you need to do to sell the house and put this matter behind you.  Don't forget that your new buyer needs to know all of this, and sometimes, it won't stop a buyer from buying, especially when it is known that the seller is being straightforward and disclosing all known fact.  That is key:  all facts that are known.  A good attorney will let you know if these facts were known when you purchased, or should have been known.  Again, be objective in your approach.  Please keep me advised, I am always interested to know if the good guys win! Karyn Foley

---------- FOLLOW-UP ----------

QUESTION: We are not interested in suing anyone. We just want the builder/inspector to make it right.  If they need to add on the extra leech lines then we just want them responsible for doing that. Thank you so much for your thoughts on this.

Answer
I am sorry, but I cannot understand why you expect the building inspector to pay for anytng.  His job is to inspect, not to build or construct.  Inspectors go around to check over properties making certain that they conform to a set of expectations and codes.  If your house is not built according to code, it needs to be disclosed.  I do not know whether or not there are fines imposed, or if you are required to do any work.  Now, if some one ordered an inspection on your house and that particular inspector did the inspection, then the results of the inspection would be given to the person who asked for the inspection.  As the inspector lives on that street, he was probably aware of the bedroom situation and how it did not conform to the requirement of being a three or four bedroom house.  Actually, you owe the inspector because his knowledge is keeping you from not misleading another buyer and being held accountable yourself for not making a full disclosure.  I would direct your dismay to the building who represented you for not making that disclosure when you purchased.  Now, if this knowledge came to you after a purchase, you have the time to either take care of the problem or sell it in its existing non-conformity but putting in writing the situation.  If you were damaged, then a real estate attorney could direct the blame as to who, if anyone, did not do due diligence in making you aware.  I know you are frustrated and want some one to pay for your problem, but please make certain that the property person - if there is indeed a person who is the culprit - is charged. Again, this is real estate opinion, a real estate attorney can tell you the law and point you in a correct direction.  I suggest you either hire one, or see if you can write to one via this website.