Introducing the new and improved NRS 113, mixed with the Nelson Case, topped some Webb v. Shull.

There is a new ruling (March 2012) on disclosure laws and the penalty associated with non-disclosure.  A seller in Nevada is required to disclose a “condition that materially affects the value or use of residential property in an adverse manner.”  This is known as a material defect.  We know from the Nelson Case in Nevada that a material defect is only one that the Seller is “aware;” if the Seller does not realize, perceive, or have knowledge of that defect or condition, then there is not a defect.

Now, in Webb v. Shull we have a ruling discussing the mental state of the Seller as to non-disclosure.  Does the Seller have to intentionally not disclosure?  Or can they merely be mistaken?  The Supreme Court in Webb instructs that holding a Seller liable for treble damages, “does not expressly or implicitly require a heighted level of mental culpability.”  In other words, the standard is low to find liability.  If the seller is aware of a defect, they must disclose or face treble damages, even if they did not “intend” to not disclose.

How does the Buyer’s Remedy Waiver Of Nrs 113.150 Rights form interact with this with all of this?  Remember from my 9.30.2012 reporting Nevada Disclosure In Residential Sales, effective October 1, 2011 the Seller’s Real Property Disclosure Form, also known as the S.R.P.D. can no longer be waived. This form must be provided in just about every residential transaction in Nevada. There are some exceptions.

Nevada law says you cannot waive your right to receive an SRPD.  It does not say you cannot waive rights as to an As Is purchase.  Thus the waiver of rights form, Buyer’s Remedy Waiver Of Nrs 113.150 Rights, which is provided in addition to the SRPD, means you are buying the property As Is, however, the Seller must ALSO disclose what they, as the Seller, know is wrong with the property.  The Seller must still disclose known  “defects.”  It’s fair if you think about it, the basic point is….“As a Seller this is what I understand is wrong with the property, and as to what I, as the Seller, do not know what is wrong, you as the Buyer, are taking the property As Is.”

This is a series of Disclosure Entries see also:

Nevada Disclosure In Residential Sales

Private Transfer Fee (Seller’s Real Property Disclosure Form)

An Updated All Inclusive & Belt Way Disclosure

The New, Improved All Inclusive Disclosure

Nevada Condominium Hotel Disclosure

Nevada S.R.P.D. New Clarification of Real Estate Disclosure Laws in Nevada

Any questions, you can call me Darren Welsh 702 245 1787.