Connecticut Seal

General Assembly

 

Raised Bill No. 5231

February Session, 2016

 

LCO No. 1168

 

*01168_______INS*

Referred to Committee on INSURANCE AND REAL ESTATE

 

Introduced by:

 

(INS)

 

AN ACT CONCERNING THE RESIDENTIAL PROPERTY CONDITION DISCLOSURE REPORT.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 20-327b of the general statutes is repealed and the following is substituted in lieu thereof (Effective January 1, 2017):

(a) Except as otherwise provided in this section, each person who offers residential property in the state for sale, exchange or for lease with option to buy, shall provide a written residential condition report to the prospective purchaser at any time prior to the prospective purchaser's execution of any binder, contract to purchase, option or lease containing a purchase option. A photocopy, duplicate original, facsimile transmission or other exact reproduction or duplicate of the written residential condition report containing the prospective purchaser's written receipt shall be attached to any written offer, binder or contract to purchase. A photocopy, duplicate original, facsimile transmission or other exact reproduction or duplicate of the written residential condition report containing the signatures of both seller and purchaser shall be attached to any agreement to purchase the property.

(b) The following shall be exempt from the provisions of this section: (1) Any transfer from one or more co-owners solely to one or more of the co-owners; (2) transfers made to the spouse, mother, father, brother, sister, child, grandparent or grandchild of the transferor where no consideration is paid; (3) transfers pursuant to an order of the court; (4) transfers of newly-constructed residential real property for which an implied warranty is provided under chapter 827; (5) transfers made by executors, administrators, trustees or conservators; (6) transfers by the federal government, any political subdivision thereof or any corporation, institution or quasi-governmental agency chartered by the federal government; (7) transfers by deed in lieu of foreclosure; (8) transfers by the state of Connecticut or any political subdivision thereof; (9) transfers of property [which] that was the subject of a contract or option entered into prior to January 1, 1996; and (10) any transfer of property acquired by a judgment of strict foreclosure or by foreclosure by sale or by a deed in lieu of foreclosure.

(c) The provisions of this section shall apply only to transfers by sale, exchange or lease with option to buy, of residential real property consisting of not less than one nor more than four dwelling units which shall include cooperatives and condominiums, and shall apply to all transfers, with or without the assistance of a licensed real estate broker or salesperson, as defined in section 20-311.

(d) (1) Not later than January 1, [2013] 2017, the Commissioner of Consumer Protection shall [, by regulations adopted in accordance with the provisions of chapter 54,] prescribe the form of the written residential disclosure report required by this section and sections 20-327c to 20-327e, inclusive. The [regulations shall provide that the] form shall include information required under subdivision (2) of this subsection and information concerning:

(A) Municipal assessments, including, but not limited to, sewer or water charges applicable to the property. Such information shall include: (i) Whether such assessment is in effect and the amount of the assessment; (ii) whether there is an assessment on the property that has not been paid, and if so, the amount of the unpaid assessment; and (iii) to the extent of the seller's knowledge, whether there is reason to believe that the municipality may impose an assessment in the future;

(B) Leased items on the premises, including, but not limited to, propane fuel tanks, water heaters, major appliances and alarm systems;

(C) (i) Whether the real property is located in a municipally designated village district or municipally designated historic district or has been designated on the National Register of Historic Places, and (ii) a statement that information concerning village districts and historic districts may be obtained from the municipality's village or historic district commission, if applicable; [.]

(D) Environmental matters such as lead, radon, subsurface sewage disposal, flood hazards and, if the residence is or will be served by well water, as defined in section 21a-150, the results of any water test performed for volatile organic compounds and such other topics as the commissioner may determine would be of interest to a buyer;

(E) If the property is located in a common interest community, whether the property is subject to any community or association dues or fees;

(F) Whether, during the seller's period of ownership, there is or has ever been an underground storage tank located on the property, and, if there is or was, if it has been removed. If such underground storage tank has been removed, such seller shall state when it was removed, who removed it and shall provide any and all written documentation of such removal within the seller's possession and control;

(G) Whether the seller is aware of any prior or pending litigation, government agency or administrative action, order or lien on the premises related to the release of any hazardous substance;

(H) Whether there are smoke detectors and carbon monoxide detectors located in a dwelling on the premises, the number of such detectors, whether there have been any problems with such detectors and an explanation of any such problems.

(2) Such form of the written residential disclosure report shall contain the following:

(A) A certification by the seller in the following form:

"To the extent of the seller's knowledge as a property owner, the seller acknowledges that the information contained above is true and accurate for those areas of the property listed. In the event a real estate broker or salesperson is utilized, the seller authorizes the brokers or salespersons to provide the above information to prospective buyers, selling agents or buyers' agents.

T1

.... (Date)

.... (Seller)

T2

.... (Date)

.... (Seller)"

(B) A certification by the buyer in the following form:

"The buyer is urged to carefully inspect the property and, if desired, to have the property inspected by an expert. The buyer understands that there are areas of the property for which the seller has no knowledge and that this disclosure statement does not encompass those areas. The buyer also acknowledges that the buyer has read and received a signed copy of this statement from the seller or seller's agent.

T3

.... (Date)

.... (Seller)

T4

.... (Date)

.... (Seller)"

(C) A statement concerning the responsibility of real estate brokers in the following form:

"This report in no way relieves a real estate broker of the broker's obligation under the provisions of section 20-328-5a of the Regulations of Connecticut State Agencies to disclose any material facts. Failure to do so could result in punitive action taken against the broker, such as fines, suspension or revocation of license."

(D) A statement that any representations made by the seller on the written residential disclosure report shall not constitute a warranty to the buyer.

(E) A statement that the written residential disclosure report is not a substitute for inspections, tests and other methods of determining the physical condition of property.

[(F) Information concerning environmental matters such as lead, radon, subsurface sewage disposal, flood hazards and, if the residence is or will be served by well water, as defined in section 21a-150, the results of any water test performed for volatile organic compounds and such other topics as the Commissioner of Consumer Protection may determine would be of interest to a buyer.]

[(G)] (F) A statement that information concerning the residence address of a person convicted of a crime may be available from law enforcement agencies or the Department of Emergency Services and Public Protection and that the Department of Emergency Services and Public Protection maintains a site on the Internet listing information about the residence address of persons required to register under section 54-251, 54-252, 54-253 or 54-254, who have so registered.

[(H) If the property is located in a common interest community, whether the property is subject to any community or association dues or fees.

(I) Whether, during the seller's period of ownership, there is or has ever been an underground storage tank located on the property, and, if there is or was, if it has been removed. If such underground storage tank has been removed, such seller shall state when it was removed, who removed it and shall provide any and all written documentation of such removal within the seller's possession and control.]

[(J)] (G) A statement that the prospective purchaser should consult with the municipal building official in the municipality in which the property is located to confirm that building permits and certificates of occupancy have been issued for work on the property, where applicable.

[(K)] (H) A statement that the prospective purchaser should have the property inspected by a licensed home inspector.

[(L) A question as to whether the seller is aware of any prior or pending litigation, government agency or administrative action, order or lien on the premises related to the release of any hazardous substance.

(M) Whether there are smoke detectors and carbon monoxide detectors located in a dwelling on the premises, the number of such detectors, whether there have been any problems with such detectors and an explanation of any such problems.]

(e) (1) On [or] and after January 1, [1996] 2017, the Commissioner of Consumer Protection shall make available the residential disclosure report form prescribed in accordance with the provisions of this section and sections 20-327c to 20-327e, inclusive, to the Division of Real Estate, all municipal town clerks, the Connecticut Association of Realtors, Inc., and any other person or institution that the commissioner believes would aid in the dissemination and distribution of such form. The commissioner shall also cause information concerning such form and the completion of such form to be disseminated in a manner best calculated, in the commissioner's judgment, to reach members of the public, attorneys and real estate licensees.

(2) The commissioner shall submit any recommendations for material changes to the form of the written residential disclosure report to the joint standing committee of the General Assembly having cognizance of matters relating to real estate. No such changes to the form shall be effective unless enacted by the General Assembly, except the commissioner may update the form each October first to correct any technical errors in or make format changes to such form.

This act shall take effect as follows and shall amend the following sections:

Section 1

January 1, 2017

20-327b

Statement of Purpose:

To eliminate the requirement that the form of the residential property condition disclosure report be prescribed by regulation, and to require material changes to the form to be enacted by the General Assembly.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]