Should you disclose a disruptive neighbor?

Maybe, depending on the outcome of this case in Arizona.

Glenn Melton thought he was buying the American dream for his daughter. What he got was a neighbor who launches into obscene tirades at any hour.

So Melton sued the man who sold him the house.

At issue is whether the neighbor’s behavior constitutes a nuisance that should have been noted on the “residential seller’s property-disclosure statement” that every home seller has to fill out.

Melton eventually asked the former owner to take the house back. When he refused, Melton sued.

Nathan Thinnes, the former owner, said that he wrestled with whether to disclose the neighbor’s problems but was told not to by his Realtor. (ed. note: bolding mine)

According to court documents, the Realtor denies giving that advice, so Thinnes sued him. And the neighbor and her mother, who lives with her.

Local and national real-estate attorneys are hesitant to comment about the case, partly because Melton and Thinnes are both executives in the real-estate business. (ed note: so what if they are? bolding mine again)

“Is she the ideal neighbor? No,” he said. “Would I want her living next to me now? No. But do I think it rises to the level of broadcasting to the world that you have someone with a disability living next door to you? I don’t think so.”

Melton disagreed.

“Look,” he said. “I don’t care why she’s a nuisance. She could be a neo-Nazi, or she could be a member of the Jackhammer Society.

“Whatever. It doesn’t matter why she’s a nuisance, it’s just that it’s a significant intrusive nuisance, and that’s what he needed to disclose.”

In all honesty, should the NAR step in and give advice?

Virginia’s Disclosure law says this:

2. The owner makes no representations with respect to any matters that may pertain to parcels adjacent to the subject parcel and that purchasers are advised to exercise whatever due diligence a particular purchaser deems necessary with respect to adjacent parcels in accordance with terms and conditions as may be contained in the real estate purchase contract, but in any event, prior to settlement on a parcel of residential real property;

I have been trained my entire career that the seller (and Realtor) are responsible for disclosing problems within the four corners of the property; this is a very wide-ranging case and article – read the whole thing. It’s a potentially sticky-wicket, as they say – what if the Realtors’ ethical duties to the clients and the public overlap?

Should the potential buyers have searched for Rotten Neighbors?

(tune in tomorrow for a post about Realtor ethics)

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About Jim Duncan

A Charlottesville Realtor who tries to stay on the bleeding/cutting/functional edge of technology and real estate trends. I have been selling real estate for the past 10 years, lived in C'Ville for twenty+ and am married to one of few Charlottesville natives left.
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  • http://www.curbplaces.com Kelly

    I would be frustrated too if I moved into a house and didn’t like my neighbors. It’s not as big of a deal if you don’t live really close to each other, but it definitely can make a difference. The rotten neighbors website is pretty funny, he should have checked that out first.

  • http://www.clientcentricrealestate.com Matthew Rathbun

    Should NAR get involved? My opinion is yes, this is exactly what RPAC funds should be used for. This case could be used against Realtors for years, if someone doesn’t use some commonsense. At what point should an agent interpret how a buyer might react to a bad neighbor. Mine is terrible and has a dog that just wont stop barking and kids under 10 who curse – should I be able to sue the listing agent? NO!

    Here is Virginia’s statute regarding disclosure:
    VA Code 54..1-2132

    B. 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. 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 conspicuous and printed either in bold lettering or all capitals, and shall be underlined or in a separate box. A licensee shall not be liable to a buyer for providing false information to the buyer if the false information was provided to the licensee by the seller or was obtained from a governmental entity or from a person licensed, certified, or registered to provide professional services in the Commonwealth, upon which the licensee relies, and the licensee did not (i) have actual knowledge that the information was false or (ii) act in reckless disregard of the truth. 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.).

    In this case the agent is specifically (refer to section i) prohibited from disclosing things outside of the property.

    At what point should the agent be responsible to deal with “life”. Annoying and even handicapped neighbors happen. Could this buyer sue if the next door house was vacant and later someone with a mental health issue moved in?

    This stuff makes me nutzy!

  • Jeanne Breault

    Interested in seeing the outcome of this one!

    You can control some of the (fill in the blank, in this case neighbors)some of the time, but you can’t control all of the (fill in the blank, in this case neighbors)all of the time.

    I agree with Matt…what would this guy do if a disruptive neighbor moved in AFTER he purchased the property…sue the new neighbor’s agent for not disclosing to the neighborhood how disruptive their new neighbor was going to be?!

    Sheesh!

  • http://www.twitter.com/industryminute Ricardo Bueno

    Jeanne makes a good point! It’s an unfortunate problem, but what can you do?

  • http://www.delawareohrealestate.com Toby & Sadie

    I have to agree with everyone so far. This isn’t looking like a very strong case. But, it will probably end up with another form that our buyers/sellers have to sign.

    When selling in the farm regions of Northwest Ohio buyers have to sign an addendum that this is an agricultural community and farmers do not work “normal” hours.