Posted by GOLDGIRL/CA on 1/28/13 7:06pm
Msg #452792

Murder in the house

I thought the following is an interesting story in light of Bear900's recent post about CA being a "nanny state" when it comes to real estate. One of the required disclosures to CA sellers is if there has been some sort of murder in the house. A dentist I know bought a house owned by a big-time orthodontist whose son shot the family, killing his father and younger sister. The mother survived. The son went to jail. But the murders had to be disclosed prior to sale. (Not that it was a big secret, of course, and everybody knew about the house, still...)


ABC News
1/28/2013

A Pennsylvania woman has appealed to the state Supreme Court in her suit against a home seller and real estate agent who failed to disclose that a murder-suicide had taken place in the home she purchased.
When Janet Milliken, 59, moved from California after her husband died, she had hoped to start a new life with her two teenage children in Pennsylvania near her family.
She bought a home in Thornton, Pa., for $610,000 in June 2007. She learned a few weeks after she moved in from a next-door neighbor that a murder-suicide had occurred the year before in her home.
She sued the seller and the real estate agent for fraud and misrepresentation, saying they made a "deliberate choice not to disclose the home's recent past," according to a court document.
The trial judge granted summary judgment in favor of the defendants, saying state law does not require agents to disclose such events.
Then in December 2012, a panel of the state appeals court affirmed that decision.
The matter dates to Feb. 11, 2006, when a previous homeowner, Konstantinos Koumboulis, shot and killed his wife, then shot himself in the master bedroom.
Joseph and Kathleen Jacono had bought the home Oct. 31, 2006, knowing of the murder-suicide, for $450,000. They later sold it to Milliken, who wants the transaction rescinded and her money back.
Filing a petition to the Supreme Court of Pennsylvania last week with the hope of arguing the case further, the attorney for Milliken, Tim Rayne, said they "hope to have Pennsylvania recognize that having a horrific event occur within a property can be just as damaging and troubling to a future homeowner as a physical defect, or perhaps even more so."
"Having a gunshot murder-suicide committed within the home is much more devastating than having a small leak concealed by the previous homeowner," Rayne said. "Physical defects can be fixed. Troubling events that could and did occur in this home could never go away."
Rayne said sellers should be required to disclose troubling events "at least for some period of time."
Abraham Reich, the attorney for the Jaconos and their agent with Re/Max, said, "The majority, en banc [full-court] opinion of the Superior Court was well reasoned and consistent with years of industry practice in Pennsylvania.
"While the issue is interesting, the number of times it comes up does not warrant Supreme Court review," Reich said. "The Superior Court opinion provides guidance for any real estate transaction in the future and puts to rest the uncertainty of whether a seller has a duty to disclose a murder-suicide or any other type 'psychological damage.' In my opinion, the result is a good one."
Rayne said Milliken, 59, was "disturbed" when she learned of her home's history from a neighbor. "As she was struggling what and if to tell the kids," he said, her children's friends visited the home for Halloween and told the children about the murder-suicide.
"They were very upset upon learning about it and disturbed about the whole situation," Rayne said.
"They were dealing with the death of a father and husband and wanted to move closer to family, and then this happened to them," he said. "It was a tragedy all around."
Rayne said Milliken and her children are still living in the home. He said they would prefer to move out of the home but can't afford to do so without selling it.
"They feel that if they sold it, through good conscience they would have to disclose," Rayne said, "so it would negatively impact the value."

Reply by ToniK on 1/28/13 7:13pm
Msg #452793

Sounds like a real life "American Horror Story" season 1 n/m

Reply by PegiT_MN on 1/28/13 7:41pm
Msg #452802

I wonder if not having to disclose about the murder/suicide is state specific, because I thought for sure it was mandatory here in Minnesota that if someone dies in the home it needs to be disclosed. I have many friends that are real estate agents, and I remember them talking about it.

Reply by Linda_H/FL on 1/28/13 7:56pm
Msg #452806

I know it's required in CT...not sure about here in FL..

I believe it's required here too but not sure.

Reply by Linda_H/FL on 1/28/13 7:57pm
Msg #452807

And now that I think about it I'm guessing not..

The Sellers of our home here had a trailer at the back of the property - Mr.'s father lived there..and died there - they didn't tell us that - we found out from the neighbor. Wouldn't have made a difference to me but..yeah...wasn't in the disclosures.

Reply by MikeC/TX on 1/28/13 8:47pm
Msg #452815

It is probably state specific. I was a real estate agent in NY for about 5 years, and we were required to disclose any information that was "material" about the property to the purchaser. The fact that someone died in the home (either through violence or natural causes) was not considered material and did not have to be disclosed unless the seller decided to disclose it.

And some buyers really don't care - the "Amityville Horror House" on Long Island has been sold and resold several times over the years, and the buyers had no problems with the history of the house. In fact, it's been more of a problem keeping gawkers away from that house than it has been selling it.

Reply by ikando on 1/28/13 9:23pm
Msg #452822

Because my neighbor died in his house while it was under foreclosure, I specifically asked the real estate board about this. Apparently Oklahoma is like New York, only material information is required to be disclosed, and a death on the property is not material.

Reply by MikeC/TX on 1/28/13 9:50pm
Msg #452828

There you go - it might be considered "material" in some states, and i have no idea what the requirements are in CA, but unless it's a "material disclosure" under state law, the buyer really has no case if he/she finds out later that someone was murdered in the home.

Reply by GOLDGIRL/CA on 1/28/13 10:01pm
Msg #452830

Found some stuff, including:

California Statute:
California Civil Code states that a death that occurred on a property more than three years prior to the sale need not be disclosed to the buyer. Death on a property must be disclosed to potential buyers if the death occurred within the past three years and it was gruesome, offensive or otherwise would affect the property's reputation, according to Weiss & Weissman, a San Francisco-based law firm. Such a death would be considered "material," according to Weiss & Weissman.

California Case Law:
In order to avoid a lawsuit, sellers should always disclose a death if it occurred within three years, no matter how the person died, and even if it occurred more than three years prior, under certain circumstances. They should allow the buyer to decide whether the death is a material fact - that is, whether or not it affects the property's reputation or desirability. California addressed the issue of death disclosure in the 1983 case of Reed v. King, which involved the disclosure of a multiple murder, says Mar Vista 21, a Los Angeles real estate firm. The plaintiff, or buyer, successfully proved that the murder at the site adversely affected the property' value, even though it occurred more than three years prior to their purchasing the home.

Exception:
The Reed v. King decision led to a revision of California Civil Code in 1987. Privacy protections for AIDS patients, which were already addressed by Federal law in the Federal Fair Housing Act, were further clarified in California statute by limiting the Reed findings to those deaths unrelated to AIDS or other causes, says Weiss & Weissman. A seller need not disclose AIDS-related deaths, no matter how recent, says the firm.

Read more: Laws Regarding Death Disclosures in Real Estate Transactions in California | eHow.com http://www.ehow.com/list_6829921_laws-real-estate-transactions-california.html#ixzz2JKjaaV9E

Reply by GOLDGIRL/CA on 1/28/13 10:08pm
Msg #452831

P.S. n/m

Reply by GOLDGIRL/CA on 1/28/13 10:11pm
Msg #452832

Re: P.S. again

I thought the part about not having to disclose AIDS related deaths interesting. There was a time not all that long ago when everybody was freaking out about "catching" the AIDS virus; and knowing that somebody died of AIDS in a house would have sent some prospective buyers running and screaming in the opposite direction (if they had known about it, which federal law apparently prohibits).

Reply by MikeC/TX on 1/28/13 11:18pm
Msg #452851

Re: Found some stuff, including:

That's great, but this happened in PA and is not not subject to CA law. The fact that someone died in the home (naturally or violently) is not considered "material" under PA law and doesn't have to be disclosed. Whatever you guys do in CA is wonderful, and that 3-year thing is interesting, but it doesn't apply once you leave the state....

Reply by GOLDGIRL/CA on 1/28/13 11:40pm
Msg #452853

Re: Found some stuff, including:

Of course PA is not subject to CA law. I only posted because I thought the original story was interesting, and then added what CA does. How this got twisted into somehow I would think CA law would apply anywhere else is scary. Sorry I posted at all. Yikes!

Reply by The Happy Homemaker - Debra on 1/28/13 11:58pm
Msg #452856

Re: Found some stuff, including:

Please don't be sorry for posting this. I found it very interesting,,,,and I followed all the posts...and I didn't get the idea that you were trying to apply one state law to another. It is because of stories like this one that I read the forum. I like to learn.

Reply by Julie/MI on 1/29/13 9:58am
Msg #452885

Called a stigmatized property in MI;not required to disclose

The seller does not have to disclose a stigmatized event, but they do have disclose if it was a meth lab.

It's up to the purchaser to research the newspaper, et al sources.

Reply by MikeC/TX on 1/29/13 5:20pm
Msg #452982

Re: Called a stigmatized property in MI;not required to disclose

They have to disclose if it was a meth lab?? Is that a big problem in MI?

Not sure how it works in other states, but in NY you are either a buyer's agent or a seller's agent, and it's not uncommon for a purchaser to work with a seller's agent (as long as they understand the nature of the relationship - the agent will work WITH the buyer, but works FOR seller). In that situation, even if the agent were aware of a stigmatized property, the info could not be disclosed without the seller's permission because it's not considered material.

However, if acting as a buyer's agent it is the agent's responsibility to research stuff like this, and they can get in big trouble if they miss something they should have known about from doing due diligence. In addition to possible sanctions from the State and from the local real estate board, the agent could be on the hook for legal action for breaching a fiduciary responsibility.

In the part of NY I was in, purchasers were reluctant to sign on with a buyer's agent, mostly because it was a relatively new concept there and they didn't understand the difference (neither did a lot of the real estate agents, unfortunately); having a professional who would do the due diligence for them was a huge selling point.