Seller Disclosure Requirements

SELLER DISCLOSURES

Common Area Defects. Before the transfer of title, sellers must deliver to buyers a written statement listing all substantial defects or malfunctions in the major systems in the unit and common areas, or a written statement disclaiming knowledge of any such substantial defects or malfunctions. Civil Code §1134(a) "Major systems" includes, but is not limited to, the roof, walls, floors, heating, air conditioning, plumbing, electrical systems or components of a similar or comparable nature, and recreational facilities. Civil Code §1134(c) Failure to make such disclosures gives the buyer the right to rescind the agreement. Civil Code §1134(b)

Documents. As required by Civil Code §1368(a), prior to the close of escrow sellers must provide buyers with the following documents:

1. The association's governing documents, (articles of incorporation, CC&Rs, bylaws, rules, and condominium plan). If unincorporated, than a statement that the association is not incorporated.

2. Any restriction in the governing documents limiting the occupancy on the basis of age.

3. A copy of the association's budget, reserves, financial statement, etc. per Civil Code §1365.

4. A statement from the association regarding:

a. Current regular and special assessments and fees.

b. Assessments levied upon the owner that are unpaid, and any unpaid fines.

c. Information on late charges, interest, and costs of collection which, may become a lien upon the unit/lot.

5. Notices previously sent to the owner per Civil Code §1363(h) regarding uncorrected violations of the governing documents. The association is not required to inspect an owner's separate interest.

6. A copy of the preliminary list of defects provided to members pursuant to Civil Code §1375, unless the association and the builder subsequently enter into a settlement agreement or otherwise resolve the matter and the association complies with Civil Code §1375.1.

7. A copy of the latest information provided for in Section 1375.1:

a. A description of the defects the association will be corrected or replaced.
b. A good faith estimate of when the defects will be corrected or replaced.
c. The status of the claims for defects

8. Any change in the association's current regular and special assessments and fees which have been approved by the association's board of directors, but have not become due and payable as of the date disclosure is provided pursuant to this subdivision.

Association Obligations. As required by Civil Code §1368(a) the association is obligated upon written request, to produce within 10 days a copy of the items specified in paragraphs 1 to 8 above. The association may charge a fee for this service that may not exceed the association's reasonable cost to prepare and reproduce the requested items.

Fine for Willful Violation. There is a $500 fine for anyone who willfully violates the disclosure requirement. Civil Code §1368(d),

Updated by ADAMS KESSLER 3/10/2008