S 871 Session 112 (1997-1998)
S 0871 General Bill, By Alexander
A BILL TO AMEND TITLE 27, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO
PROPERTY AND CONVEYANCES, BY ADDING CHAPTER 49 SO AS TO PROVIDE FOR A WRITTEN
PROPERTY CONDITION DISCLOSURE STATEMENT UPON THE SALE OF RESIDENTIAL
PROPERTIES, AND PROVIDE FOR RELATED MATTERS.
12/15/97 Senate Prefiled
12/15/97 Senate Referred to Committee on Judiciary
01/14/98 Senate Introduced and read first time SJ-18
01/14/98 Senate Referred to Committee on Judiciary SJ-18
A BILL
TO AMEND TITLE 27, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO PROPERTY AND
CONVEYANCES, BY ADDING CHAPTER 49 SO AS TO
PROVIDE FOR A WRITTEN PROPERTY CONDITION
DISCLOSURE STATEMENT UPON THE SALE OF
RESIDENTIAL PROPERTIES, AND PROVIDE FOR RELATED
MATTERS.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Title 27 of the 1976 Code is amended by adding:
"CHAPTER 49
PROPERTY CONDITION DISCLOSURE
"Section 27-49-10. This chapter applies to the following transfers
of residential real property consisting of at least one but not more
than four dwelling units, whether or not the transaction is with the
assistance of a licensed real estate broker or salesman:
(1) sale or exchange;
(2) installment land sales contract;
(3) option to buy or sell;
(4) sale or exchange of an interest in a vacation timesharing plan
or multiple ownership plan; or
(5) sale of partnership interest or share of stock in a corporation
where residential real property is the only significant asset.
Section 29-49-20. The following transfers are exempt from the
provisions of this chapter:
(1) transfers pursuant to court order, including transfers ordered
by a court in administration of an estate, transfers pursuant to a writ
of execution, transfers by foreclosure sale, transfers by a trustee in
bankruptcy, transfers by a receiver, transfers by eminent domain, and
transfers resulting from a decree for specific performance;
(2) transfers to a mortgagee from the mortgagor or his successor
in interest in a mortgage, if the indebtedness is in default; transfers by
a trustee under a deed of trust or a mortgagee under a mortgage, if the
indebtedness is in default; transfers by a trustee under a mortgagee
under a mortgage pursuant to a foreclosure sale, or transfers by a
mortgagee who has acquired the real property at a sale conducted
pursuant to a judgment and order foreclosure;
(3) transfers by a fiduciary in the course of the administration of
a decedent's estate, guardianship, conservatorship, or trust;
(4) transfers from one or more co-owners solely to one or more
other co-owners;
(5) transfers made solely to a spouse or a person or persons in the
lineal line of consanguinity of one or more transferors;
(6) transfers between spouses resulting from a divorce decree or
support order, or marital property distribution order;
(7) transfers made by virtue of the record owner's failure to pay
any federal, state, or local taxes;
(8) transfers to or from the federal government;
(9) transfers to the State, its agencies, and departments, and its
political subdivisions, including school districts; or
(10) transfers involving the first sale of a dwelling never inhabited,
provided builder offers a written home warranty;
(11) lease with option to purchase contracts where the lessee
occupies or intends to occupy the dwelling;
(12) real property sold at public auction;
(13) transfers between parties when both parties agree in writing
not to complete a residential property disclosure statement.
Section 27-49-30. As used in this chapter:
(1) 'Owner' means each person having recorded present or future
interest in real estate that is identified in a real estate contract subject
to this chapter, but shall not mean or include the owner or holder of
a mortgage, deed of trust, mechanic's or materialman's lien, or other
lien or security interest in the real property, or the owner of any
easement or license encumbering the real property.
(2) 'Purchaser' means each person or entity named as 'purchaser'
or 'purchasers' in a real estate contract subject to this chapter.
(3) 'Real estate contract' means a contract for the transfer of
ownership of real property.
(4) 'Real property' means the lot or parcel, and the dwelling unit
described in a real estate contract subject to this chapter.
Section 27-49-40. (A) The owner of the real property shall furnish
to a purchaser a residential property disclosure statement. The
disclosure statement shall contain the language and be in the form set
forth in subsection (B) of this section. The statement shall disclose
those items that are required to be disclosed relative to the condition
of the property and of which the owner has actual knowledge, except
as otherwise agreed in the real estate contract.
(B) A residential property disclosure statement shall read as
follows:
'Residential Property Disclosure Statement
Notice to Owner and Purchaser
The South Carolina Residential Property Disclosure Act requires the
owner of residential real property consisting of one through four
units, whenever the property is to be sold, exchanged, or optioned, to
furnish to the purchaser a residential property disclosure statement
disclosing certain conditions of the property. Certain transfers of
residential property are excluded from this requirement by this act.
This disclosure statement is designed to assist the owner in
complying with the disclosure requirements and to assist the
purchaser in evaluating the property being considered. The listing
real estate broker, the selling real estate broker and their respective
clients, if applicable, will also rely upon this information when they
evaluate, market, and present the owner's property to prospective
purchasers. This is a disclosure of the owner's personal knowledge
of the condition of the property as of the date signed by the owner
and is not a substitute for any inspections or warranties that the
purchaser may wish to obtain. This form is not a warranty of any
kind by the owner or a warranty or representation by the listing
broker, the selling broker, or their agents, if applicable.
Property Address/Description:
The undersigned owner of the real property described above
discloses the following present conditions of the real property of
which the owner has actual knowledge with regard to:
1. Any defect in the plumbing, water supply, or sanitary sewage
disposal systems:
[ ] Yes [ ] None known
If yes, please describe
2. Any defect in the roof, chimneys, floors, foundation, basement,
or load-bearing walls, or any leak in the roof or basement:
[ ] Yes [ ] None known
If yes, please describe
3. Any defect in the electrical, heating, or cooling systems:
[ ] Yes [ ] None known
If yes, please describe
4. Present infestation of termites, or other wood-destroying insects
or organisms or past infestation for which the damage has not been
repaired:
[ ] Yes [ ] None Known
If Yes, please describe
5. The real property's violation of zoning laws, restrictive covenants
or building codes; any encroachment of the real property from
adjacent real property, or projections onto adjacent property; or
notice from any governmental agency affecting this real property:
[ ] Yes [ ] None Known
If Yes, please describe
6. Presence of lead-based paint, asbestos, radon gas, methane gas,
underground storage tank, hazardous material or toxic material, or
any report affecting these items (whether buried or covered):
[ ] Yes [ ] None Known
If Yes, please describe
The undersigned Owner represents that the information set forth in
the foregoing disclosure statement is accurate and complete to the
best of Owner's personal knowledge. Owner hereby authorizes
Broker, if applicable, to provide this information to prospective
Purchasers of the property and to real estate brokers and salespeople.
The Owner has a duty to disclose to Purchaser any material
inaccuracy in this statement or any material change in the real
property that is discovered between the date of this statement and the
closing of the transaction. The Owner(s) acknowledge receipt of a
copy of this disclosure statement and further acknowledge that they
have examined it before signing below:
Owner Date Owner Date
Broker Date
The undersigned Purchaser has carefully inspected the property.
Purchaser is advised to have the property examined by professional
inspectors. Purchaser acknowledges that neither any broker nor
agent, if applicable, involved in this transaction is an expert at
detecting or repairing physical defects in the property. Purchaser
states that no representations concerning the condition of the property
are being relied upon by Purchaser except as disclosed above. The
Purchaser(s) acknowledge receipt of a copy of this disclosure
statement and further acknowledge that they have examined it before
signing below:
Purchaser Date Purchaser Date'
Section 27-49-50. (A) The owner of real property subject to this
chapter shall deliver to the purchaser the written disclosures required
by this chapter no later than the time the purchaser makes an offer
consistent with Section 27-49-10. The residential property disclosure
statement may be included in the real estate contract, in an
addendum, or in a separate document.
(B) If the disclosure statement required by this chapter is not
delivered to the purchaser prior to or at the time the purchaser makes
an offer, the purchaser may cancel any resulting real estate contract.
The purchaser's right to cancel shall expire if not exercised prior to
the following, whichever occurs first:
(1) the end of the third calendar day following the purchaser's
receipt of the disclosure statement; or
(2) the end of the third calendar day following the date the
contract was made; or
(3) settlement or occupancy by the purchaser in case of a sale
or exchange.
Any right of the purchaser to cancel the contract provided by this
subsection is waived conclusively if not exercised in the manner
required by this subsection.
In order to terminate a real estate contract when permitted by this
section, the purchaser shall, within the time required above, give
written notice to the owner or the owner's agent either by hand
delivery or by depositing into the United States mail, postage prepaid,
and properly addressed to the owner or the owner's agent. If the
purchaser cancels a real estate contract in compliance with this
subsection, the cancellation shall be without penalty to the purchaser,
and the purchaser shall be entitled to a refund of any deposit the
purchaser may have paid. Any rights of the purchaser to cancel or
terminate the contract for reasons other than those set forth in this
subsection are not affected by this subsection.
Section 27-49-60. The owner may discharge the duty to disclose
imposed by this chapter by providing a written report attached to the
residential property disclosure statement by a public agency or by an
engineer, land surveyor, geologist, pest control operator, contractor,
home inspector or other expert, dealing with matters within the scope
of the public agency's functions or the expert's license or expertise.
The owner shall not be liable for any error, inaccuracy, or omission
of any information delivered pursuant to this section if the error,
inaccuracy, or omission was made in reasonable reliance upon the
information provided by the public agency or expert and the owner
was not grossly negligent in obtaining the information or transmitting
it.
Section 27-49-70. If, subsequent to the owner's delivery of a
residential property disclosure statement to a purchaser, the owner
discovers a material inaccuracy in the disclosure statement, or the
disclosure is rendered inaccurate in a material way by the occurrence
of some event or circumstance, the owner shall promptly correct the
inaccuracy by delivering a corrected disclosure statement to the
purchaser. Failure to deliver the corrected disclosure statement or to
make the repairs made necessary by the event or circumstance shall
result in such remedies for the Purchaser as are provided for by law
in the event the sale agreement requires the property to be in
substantially the same condition at closing as on the date of the offer
to purchase, reasonable wear and tear excepted.
Section 27-49-80. A real estate broker or salesman acting as an
agent in a residential real estate transaction has a duty to inform each
of the clients of the real estate broker or salesman of the client's
rights and obligations under this chapter. If the owner's real estate
broker or salesman has performed this duty, the broker or salesman
shall not be responsible for the owner's wilful refusal to provide a
prospective purchaser with a residential property disclosure
statement. Nothing in this chapter shall be construed to conflict with,
or alter, the broker's or salesman's duties under Chapter 57 of Title
40.
Section 27-49-90. This chapter shall not affect the landlord-tenant
relationship between the parties to a lease with an option-to-purchase
contract during the term of the lease, and the rights of the landlords
and tenants under the South Carolina Residential Landlord and
Tenant Act shall remain in effect until transfer of ownership of the
property to the purchaser.
Section 27-49-100. The South Carolina Real Estate Commission
may prepare, or cause to be prepared, forms for use pursuant to this
chapter. The commission may charge a fee not to exceed twenty-five
cents per form plus the costs of postage."
SECTION 2. This act takes effect January 1, 1999, and applies to
contracts entered into on or after that date.
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