Ask George & Chuck: Questions from Consumers

Written by Posted On Monday, 13 June 2005 17:00

Dear Ask George: "I represent the seller of a 20-year old home in Kennesaw, Georgia. There were concerns about the safety of one of the furnaces. A licensed inspector went to the home and tested the ppm (parts per million) on the furnace and found it to be 122, which is above recommended safety levels. Rather than disable the furnace (there are two others that are not showing dangerous levels, a gas hot water heater, and a stove that are all deemed safe), the inspector called the local utility and had the gas service disabled for the entire property.

The inspector claims that he made the notification on his own and that he was legally bound to do so. He did call and speak to the agent who has the property co-listed with me, and she informed him that the sellers had no intention of replacing the lower level furnace. He took that to mean that there was a hazard which would not be remedied, and therefore he was obligated to call Atlanta Gas Light and notify them of the situation.

My sellers are livid, and have now been forced to replace something that they did not want to replace. We suspect the gas will not be turned back on until the unit is replaced, so their hand has been forced by the situation. The inspection happened on the last day of a "10 Day Right to Terminate," so there was not time left to debate the issue further. Since the buyers have chosen to proceed with the purchase of the home, and did not terminate, they are essentially guaranteed to get a new furnace.

By the way, the seller's HVAC guy had told them that the furnace was safe just 2 days before this last inspection, so the sellers had agreed to do many things that were asked as a result of the inspection (but not replace that furnace). Now it looks like they'll have to do the furnace replacement as well. Have you ever heard of such an action by an inspector or a licensed HVAC representative?" -- Concerned Agent

Answer: Under the circumstances as you have explained them, "yes" and I should think you would thank him. This inspector probably saved you and the sellers from a lawsuit if the buyers had bought the property and found the furnace to be dangerous.

When a licensed inspector or an HVAC representative has lawful access to a residential property and encounters what he believes to be a threat to persons occupying or who will occupy the property, it is likely that some legal capacity attaches to the inspector's and/or representative's actions or inactions.

First, it is a very good thing that you've asked the sellers to notify and discuss the situation with their HVAC person.

Second, I suggest calling customer service at Atlanta Gas Light. Tell them you are a licensed real estate agent, provide your contact information, and describe briefly what the purchaser's home inspector ordered. Ask the AGL person what is the "law" that the inspector claimed made him legally obligated to request the gas shut-off. Be sure to make a note of the AGL person's name and the time of your call.

Lastly, is there another real estate agent representing the buyers in this transaction? If there is, make sure they are up to speed on what is happening relative to the gas situation but make sure your sellers agree that they should be informed. If there is not another agent representing the buyers, communicate with them directly. The main thing here is that you want to treat the buyers honestly and fairly especially as regards what might be described as a material fact regarding the condition of the property.

Dear Ask George: "I took a Texas home builder a floor plan that I found on the internet and asked if he could build me that house. He said that he thought the floor plan was incredible and they could build it. After weeks of negotiations we agreed on a price and signed a contract. He has now turned the plan I brought him into his own and sold it to two other people. Four days after we signed the contract he told me that he went back over the numbers and the price had gone up.

The price increased $5,600.00 and he took $4,000.00 worth of upgrades away from me (2" faux wood blinds throughout and stone in the front).

I'm very angry and do not want to work with someone that does business that way. Do I have a remedy beyond getting my earnest money back? Can I prevent him from selling the plan I gave him?" -- Extremely Miffed

Answer: The answer to your first question is in the contract you signed with the builder. Read the entire contract thoroughly and consult an attorney regarding anything you do not understand. You may or may not have a valid complaint to register with the Texas Residential Construction Commission . Any builder who fails to make sure that you are okay with changes, especially in price and upgrades, and makes such changes without your written approval and agreement, is someone not to be trusted.

However, make sure of the facts first. Why did the price go up? There may have been a price increase on materials that he had no control over especially on a custom built house. If he just mis-bid, ok. If he's taking advantage of the situation, it's probably time to find another builder.

Is this builder a member of the Better Business Bureau of Greater Houston ? You may also be able to file a complaint with the BBB and bring the builder to arbitration or mediation.

As for your floor plan obtained from the Internet, the question is how did you obtain it? Asked another way, did you obtain any rights to use or resell the plan? Check the terms offered on that website very carefully. If you did obtain the right to use the floor plan for your own construction, then were you also obligated to inform the builder of any copyrights that attached to the plan? The matter of copyright law is complex, and not something I would advise you to take on yourself without the counsel of a competent attorney.

Dear Ask George: "I am a new real estate broker in California, and am moving to Massachusetts. I know that there is no reciprocity agreement between the two states. Will I therefore have to retake courses, get additional experience and sit for the exam, or will I be allowed to sit for the exam to obtain a license. The real question is, given my situation, at a minimum what will I have to do before I can obtain my license?" -- Bottom Line Concerns

Answer: Access the Massachusetts Division of Professional Licensure website, Real Estate Brokers and Salespersons , and then "Applications and Forms in the left-hand navigation bar.

Scroll down the page to the first hyperlink, "Reciprocal Licensure, Attorney Licensure and Waivers" and then scroll down to "All Other States" and follow the instructions.

Dear Ask George: "Are real estate agents in Massachusetts allowed to buy and sell property for themselves, or do they have to utilize an outside agent for the transaction?" -- Curious

Answer: The Massachusetts license laws that regulate the conduct of real estate agents do allow brokers and salespersons affiliated with such brokers, to buy and sell properties for themselves.

However, as a broker or salesperson there are disclosures required so that consumers know that one is a broker or salesperson and therefore, presumably, such consumer cannot be thrust into a disparate bargaining position.

In addition, many providers of Errors & Omissions insurance will not insure a real estate firm's agents when dealing with property owned by the agent. I suppose the presumption is that if a real estate agent has a financial interest in the property the agent would be more likely to succumb to what would amount to a conflict of interest than if the agent is representing another person in an "arms length" agency capacity.

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