We would like to acknowledge and thank John Blyth, Esq. for his expertise on this subject.
Many real estate agents will tell you that the Property Condition Disclosure is “required” and you have to fill it out. This is not true. You have options…Please read John’s remarks below… Download here…. Property Condition Disclosure
The New York Property Condition Disclosure Act (the “PCDA”) affecting the sale and puchase of residential property in New York is found in Real Property Law, Sections 460 through 467. It became effective on March 1, 2002.
The PCDA requires the seller to deliver to the residential buyer a 48 question Property Condition Disclosure Statement (PCDS) and provides for actual damages for willful failure to provide truthful answers based on actual knowledge OR a credit of $500.00 at Closing for failure to deliver the PCDS. The provision regarding the $500.00 credit is found in Section 465 of the Act.
Upstate, where the broker usually fills in the blanks in a bar association contract, a PCDS is routinely being delivered. Downstate, where attorneys prepare the contracts and transactions often involve larger prices, the seller often opts to give the $500.00 credit instead of delivering the PCDS.
There is a body of case law developing in New York where sellers have been found liable for willful failure to provide truthful answers based on actual knowledge. Rather than face this potential liability, some sellers have preferred to give the $500.00 credit. The buyer should be encouraged to make its own due diligence investigation by responsible professionals (engineers, etc.) responsible to the buyer.
See Karl B. Holtschue, Responses of the Legislature and the Bar Associations to Court Decisions on Sales of Residences, NYSBA N. Y. Real Property Law Journal, Spring 2005, Vol. 33, No. 2.
John E. Blyth, Esq.
141 Sully’s Trail,
Pittsford, NY 14534