New York Real Estate Salesperson ExaminationProperty Condition and DisclosuresMedium
A New York real estate salesperson is listing a property built in 1965. The seller mentions that during a renovation in the 1990s, they had some pipe insulation removed, and the contractor suggested it might have contained asbestos. The seller did not keep any records of the removal. What is the salesperson's ethical and legal obligation regarding this information?
- ADisclose the information only if the buyer specifically asks about asbestos during due diligence.
- BSuggest the seller hire an asbestos professional to test the entire property for residual fibers.
- CAdvise the seller that since the material was removed, there is no longer a disclosure requirement.
- DInstruct the seller to disclose the past presence of potential asbestos and the lack of records.
Show answer & explanationAnswer & explanation
Correct answer: D. Instruct the seller to disclose the past presence of potential asbestos and the lack of records.
Known material facts, even historical ones regarding hazardous materials like asbestos, must be disclosed. The lack of records about proper removal makes this even more critical, as it raises questions about residual risk. The agent's role is to ensure disclosure, not to perform or order tests.
Why the other options are wrong
- A. Withholding known material facts until asked is a breach of disclosure duty and could lead to liability for misrepresentation or fraud.
- B. While a good recommendation for the seller, it's not the salesperson's primary obligation to instruct the seller to conduct tests, but rather to ensure disclosure of what is known.
- C. The past presence and removal (especially without records of proper abatement) is a material fact that should be disclosed.
Asbestos Disclosure
Sellers generally must disclose known asbestos-containing materials (ACMs) in residential properties, particularly if disturbed or in poor condition, due to health risks.
- Naturally occurring mineral fiber.
- Used extensively before 1980s.
- Causes lung diseases (mesothelioma, asbestosis).
- Disclosure required if known, especially if friable.
Memory trick: Asbestos in the past, hazards may last; disclose what you know, or your reputation won't grow!