[WSBARP] Why doesn't a buyer get a new three-day rescission period after discovering inaccuracy in the seller's real property disclosure statement?

[nestor at pplsweb.com]

It also avoids the poison pill, where the buyer can keep that info their
back pocket and use it as a means to back out of the contract by
"restarting" the clock.

 

Nestor Gorfinkel, Attorney at Law

Licensed in Washington & Florida

Florida Civil-Law (International) Notary

 

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From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com>
On Behalf Of DPW
Sent: Tuesday, March 31, 2020 12:46 PM
To: 'WSBA Real Property Listserv' <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] Why doesn't a buyer get a new three-day rescission
period after discovering inaccuracy in the seller's real property disclosure
statement?

 

The law was amended to deal with issues where a buyer's inspection
discovered issues not previously disclosed, then using that information in
an effort to squeeze price concessions from the seller during the real
estate/mortgage mess.

 

From: wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com>
<wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com> > On Behalf Of Rod Harmon
Sent: Tuesday, March 31, 2020 10:14 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com
<mailto:wsbarp at lists.wsbarppt.com> >
Subject: [WSBARP] Why doesn't a buyer get a new three-day rescission period
after discovering inaccuracy in the seller's real property disclosure
statement?

 

As originally enacted in 1994, RCW 64.06.040 required a seller to amend the
seller disclosure statement if the seller became aware of additional
information which made any of the disclosures inaccurate.  An amendment
starts a new three-business-day rescission period.  In the 2009 amendments,
that requirement was amended to limit the duty to amend to situations in
which "the seller ((becomes aware)) learns from a source other than the
buyer or others acting on the buyer's behalf such as an inspector of
additional information . which makes any of the disclosures made
inaccurate."  With that amendment, if the buyer discovered the additional
information after the three-business-day period expired but before closing,
the seller was not obligated to amend the disclosure statement.  For
example, say the buyer discovers that the property is in an environmentally
critical area and the disclosure statement says it is not. Because the
rescission period had expired, the buyer would not be able to use the
disclosure statute to rescind. This seems strange to me.

I can see how in that case the buyer could rescind on a common law ground,
preserved under RCW 64.06.050.  Specifically, the buyer could rescind based
upon a mutual mistake about a material fact, or, if the seller knew of the
ECA designation, unilateral mistake by the buyer and concealment by the
seller.  But I am having trouble understanding why the legislature amended
the statute so that the buyer could not use RCW 64.06  to rescind the
contract. I did not find anything in the legislative history that addresses
it.  I would appreciate any insight anyone has into the reason for this
amendment. I am hoping someone on this listserv had a hand in drafting it.

 

Rod Harmon

 

RODNEY T. HARMON

       Attorney at Law

         P.O. Box 1066

      Bothell, WA   98041

     Tel:   (425) 402-7800

     Fax:  (425) 458-9096

     <http://www.rodharmon.com> www.rodharmon.com

    <mailto:rodharmon at msn.com> rodharmon at msn.com

 

 

 

 

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