Real Property – Seller’s Disclosures – Rhode Island

Rhode Island
CHAPTER 5-20.8
Real Estate Sales Disclosures

Index Of Sections
§ 5-20.8-1 Definitions.
§ 5-20.8-2 Disclosure requirements.
§ 5-20.8-3 Exemptions.
§ 5-20.8-4 Buyer’s rights.
§ 5-20.8-5 Real estate disclosure form acknowledgement – Inclusion in real estate sales agreements – Penalty for violation.
§ 5-20.8-6 Disclosure of psychologically impacted property.
§ 5-20.8-7 Public agency notification.
§ 5-20.8-8 Expert report.
§ 5-20.8-9 Seller and agent liability.
§ 5-20.8-10 Subsequent acts.
§ 5-20.8-11 Lead inspection requirement.

§ 5-20.8-1 Definitions. – When used in this chapter, unless the context indicates otherwise:

(1) “Agent” means any individual or entity acting on behalf of a seller or buyer to effect the transfer of real estate. It includes listing agent, selling agent, buyer’s agent, and their respective brokers.
(2) “Agreement to Transfer” means a purchase and sale agreement, installment sales contract, option to purchase agreement or other agreement intended to effect the transfer of real estate from a seller to a buyer.
(3) “Buyer” means any individual or entity seeking to obtain title to real estate from a seller for consideration.
(4) “Closing” means the time at which real estate is transferred from seller to buyer and consideration is delivered to the seller or to a settlement agent with the intention of imminent delivery upon the recording of pertinent documents and other ministerial acts associated with settlement.
(5) “Deficient Conditions” means any land restrictions, defect, malfunction, breakage, or unsound condition existing on, in, across or under the real estate of which the seller has knowledge.
(6) “Real Estate” means vacant land or real property and improvements consisting of a house or building containing one to four (4) dwelling units.
(7) “Seller” means any individual or entity seeking to transfer title to real estate to a buyer for consideration.
(8) “Transfer” means the sale or conveyance, exchange of, or option to purchase any real estate.

§ 5-20.8-2 Disclosure requirements.

(a) As soon as practicable, but in any event, no later than prior to signing any agreement to transfer real estate, the seller of the real estate shall deliver a written disclosure to buyer and to each agent with whom seller knows he or she or buyer has dealt in connection with the real estate. The written disclosure shall comply with the requirements set forth in subsection (b) and shall state all deficient conditions of which the seller has actual knowledge. Agent shall not communicate the offer of buyer until buyer has received a copy of the written disclosure and signed a written receipt of same. If buyer refuses to sign a receipt pursuant to this section, the seller or agent shall immediately sign and date a written account of the refusal. The agent is not liable for the accuracy or thoroughness of representations made by seller in the written disclosure or for deficient conditions not disclosed to the agent by the seller.

(b) The Rhode Island real estate commission may approve a form of written disclosure as required under this chapter or the seller may use a disclosure form substantially conforming to the requirements of this section. The following provisions shall appear conspicuously at the top of any written disclosure form: “Prior to the signing of an agreement to transfer real estate (vacant land or real property and improvements consisting of a house or building containing one to four (4) dwelling units), seller is providing buyer with this written disclosure of all deficient conditions of which seller has knowledge. This is not a warranty by seller that no other defective conditions exist, which there may or may not be. Buyer should estimate the cost of repair or replacement of deficient conditions prior to submitting an offer on this real estate. Buyer is advised however not to rely solely upon the representation of seller made in this disclosure, but to conduct any inspections or investigations which buyer deems to be necessary to protect his or her best interest.” Nothing contained in this section shall be construed to impose an affirmative duty on the seller to conduct inspections as to the condition of this real estate.

(2) The disclosure form shall include the following information:

(i) Seller Occupancy – (Length of Occupancy)
(ii) Year Built
(iii) Basement – (Seepage, Leaks, Cracks, etc. Defects)
(iv) Sump Pump – (Operational, Location, and Defects)
(v) Roof (Layers, Age and Defects)
(vi) Fireplaces – (Number, Working and Maintenance, Defects)
(vii) Chimney – (Maintenance History, Defects)
(viii) Woodburning Stove – (Installation Date, Permit Received, Defects)
(ix) Structural Conditions – (Defects)
(x) Insulation – (Wall, Ceiling, Floor, UFFI)
(xi) Termites or other Pests – (Treatment Company)
(xii) Radon – (Test, Company) “Radon has been determined to exist in the State of Rhode Island. Testing for the presence of radon in residential real estate prior to purchase is advisable.”
(xiii) Electrical Service – (Imp. & Repairs, Electrical Service, Amps, Defects)
(xiv) Heating System – (Type, Imp. & Repairs, Underground Tanks, Zones, Supplemental Heating, Defects)
(xv) Air Conditioning – (Imp. & Repairs, Type, Defects)
(xvi) Plumbing – (Imp. & Repairs, Defects)
(xvii) Sewage System – (Assessment, Annual Fees, Type, Cesspool/Septic Location, Last Pumped, Maintenance History, Defects)
(xviii) Water System – (Imp. & Repairs, Type, Defects) Private water supply (well). “Buyer understands that this property is, or will be served, by a private water supply (well) which may be susceptible to contamination and potentially harmful to health. If a public water supply is not available, the private water supply should be tested for coliforms, nitrates, and chlorides. Periodic testing is recommended.”
(xix) Domestic Hot Water – (Imp. & Repairs, Type, Defects, Capacity of Tank)
(xx) Property Tax
(xxi) Easements
(xxii) Deed – (Type, Number of Parcels)
(xxiii) Zoning – (Permitted use, Classification) “Buyers of real estate in the state of Rhode Island are legally obligated to comply with all local real estate ordinances; including, but not limited to, ordinances on the number of unrelated persons who may legally reside in a dwelling, as well as ordinances on the number of dwelling units permitted under the local zoning ordinances.” If the subject property is located in a historic district, that fact must be disclosed to the buyer, together with the notification that “property located in a historic district may be subject to construction, expansion or renovation limitations. Contact the local building inspection official for details.”
(xxiv) Restrictions – (Plat or Other)
(xxv) Building Permits
(xxvi) Minimum Housing – (Violations)
(xxvii) Flood Plain – (Flood Insurance)
(xxviii) Wetlands. The location of coastal wetlands, bay, fresh water wetlands, pond, marsh, river bank or swamp, as those terms are defined in chapter 1 of title 2 and the associated buffer areas may impact future property development. Seller must disclose to the buyer any such determination on all or part of the land made by the department of environmental management.
(xxix) Multi-family or other Rental Property – (Rental Income)
(xxx) Pools & Equipment, Type, Defects
(xxxi) Lead Paint – (Inspection) Every buyer of residential real estate built prior to 1978 is hereby notified that those properties may have lead exposures that may place young children at risk of developing lead poisoning. Lead poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced IQ behavioral problems, and impaired memory. The seller of that property is required to provide the buyer with a copy of any lead inspection report in the seller’s possession and notify the buyer of any known lead poisoning problem. Environmental lead inspection is recommended prior to purchase.
(xxxii) Fire
(xxxiii) Hazardous Waste – (Asbestos and Other Contaminants)
(xxxiv) Miscellaneous

(c) Any agreement to transfer real estate shall contain an acknowledgement that a completed real estate disclosure form has been provided to the buyer by the seller in accordance with the provisions of this section.

(d) The Rhode Island real estate commission has the right to amend the seller disclosure requirements by adding or deleting requirements when there is a determination that health, safety, or legal needs require a change. Any change to requirements shall be a rule change, subject to the administrative procedures act. The power of the commission to amend the written disclosure requirements are liberally construed so as to allow additional information to be provided as to the structural components, housing systems, and other property information as required by this chapter.

§ 5-20.8-3 Exemptions. – The following transfers are exempt from the provisions of this chapter:

(1) Transfer pursuant to a court order, including but not limited to transfer ordered by a probate court in administration of an estate, transfer pursuant to a writ of execution, transfer by a trustee in bankruptcy, transfer by eminent domain, and transfer resulting from a decree for specific performance.

(2) Transfer to a mortgagee by a mortgagor or pursuant to a foreclosure sale, or transfer by a mortgagee who has so acquired the real estate.

(3) Transfer by a fiduciary in the course of the administration of a decedent’s estate, guardianship, conservatorship, or trust.

(4) Transfer from one co-owner to one or more other co-owners.

(5) Transfer made to a spouse, or to a person or persons in the lineal line of consanguinity of one or more of the transferors.

(6) Transfer between spouses resulting from a decree of dissolution of marriage or a decree of legal separation or from a property settlement agreement incidental to that decree.

(7) Transfer from any governmental entity.

(8) Transfer of any new unoccupied dwelling unit from a builder or developer.

(9) Transfer by a relocation company.

(10) Transfer of title with no consideration.

§ 5-20.8-3 Exemptions. – The following transfers are exempt from the provisions of this chapter:

(1) Transfer pursuant to a court order, including but not limited to transfer ordered by a probate court in administration of an estate, transfer pursuant to a writ of execution, transfer by a trustee in bankruptcy, transfer by eminent domain, and transfer resulting from a decree for specific performance.
(2) Transfer to a mortgagee by a mortgagor or pursuant to a foreclosure sale, or transfer by a mortgagee who has so acquired the real estate.
(3) Transfer by a fiduciary in the course of the administration of a decedent’s estate, guardianship, conservatorship, or trust.
(4) Transfer from one co-owner to one or more other co-owners.
(5) Transfer made to a spouse, or to a person or persons in the lineal line of consanguinity of one or more of the transferors.
(6) Transfer between spouses resulting from a decree of dissolution of marriage or a decree of legal separation or from a property settlement agreement incidental to that decree.
(7) Transfer from any governmental entity.
(8) Transfer of any new unoccupied dwelling unit from a builder or developer.
(9) Transfer by a relocation company.
(10) Transfer of title with no consideration.

§ 5-20.8-4 Buyer’s rights.

(a) If prior to the execution of an agreement to transfer, but after seller has agreed to buyer’s offer, buyer discovers that a materially deficient condition exists which has not been disclosed to buyer, then seller’s response to buyer’s offer is deemed to be a counter offer which buyer may either accept or reject.

(b) If prior to closing but after execution of an agreement to transfer, buyer discovers that a materially deficient condition exists which has not been disclosed to buyer, then buyer may either elect to:

(1) Terminate the agreement to transfer in which case buyer shall receive all deposits paid by buyer to seller or his or her agent pursuant to the agreement; or
(2) Allow seller the opportunity to cure such deficient condition, in which case buyer must provide seller with a report of inspection performed by a recognized and reputable inspector or inspection company, within seven (7) calendar days after buyer has obtained a copy of the inspection report, whereupon seller will be given seven (7) calendar days after receipt of the report to notify buyer in writing that seller agrees, at seller’s own expense, to correct the defective condition. If seller does not so agree, buyer may terminate the agreement to transfer and buyer shall receive all deposits paid by buyer to seller or his or her agent pursuant to the agreement.
(c) Where the inspection set forth in subsection (b) is performed in accordance with a provision in the agreement to transfer, and there is a delay in the receipt of the inspection report due solely to the inspector’s inability to complete the inspection, the inspection completion date set forth in the agreement shall be extended for a reasonable time not to exceed seven (7) calendar days. The inspector shall provide buyer with an explanation of the delay which shall be made available to the seller.

§ 5-20.8-5 Real estate disclosure form acknowledgement – Inclusion in real estate sales agreements – Penalty for violation.

(a) Every agreement for the purchase and sale of residential real estate located in the state shall contain an acknowledgement that a completed real estate disclosure form has been provided to the buyer by the seller.

(b) Failure to provide the seller disclosure form to the buyer does not void the agreement nor create any defect in title; however, each violation of this statute by the seller and/or his or her agent is subject to a civil penalty in the amount of one hundred dollars ($100) per occurrence.

§ 5-20.8-6 Disclosure of psychologically impacted property.

(a) The fact or suspicion that real property may be or is psychologically impacted is not a material fact requiring disclosure in any real estate transaction. “Psychologically impacted” means an impact being the result of facts or suspicions including but not limited to the following:

(1) That an occupant of real property is now or has been suspected to be infected or is infected or has been infected with Human Immunodeficiency Virus or diagnosed with Acquired Immune Deficiency Syndrome, or any other disease which has been determined by medical evidence to be highly unlikely to be transmitted through the occupying of a dwelling place; or
(2) That the real property was or has been, at any time, suspected of being the site of a homicide, other felony, or suicide.

(b) No cause of action shall arise against the seller of the real property or his or her agent for failure to disclose to the buyer that the real property was psychologically impacted as defined in this chapter.

(2) However, under no circumstances, shall this provision be interpreted as or used as authorization for an agent or seller to make any misrepresentation of fact or false statement.

§ 5-20.8-7 Public agency notification. – Any information required to be disclosed by this section to a prospective buyer by a public agency is deemed to comply with the requirements of this section and relieves the seller or agent of any further duty under this section as to that item of information.

§ 5-20.8-8 Expert report.

(a) The delivery of a report or opinion prepared by an engineer, land surveyor, geologist, home inspector, pest control operator, contractor, or other expert, dealing with matters within the scope of the professional’s license or expertise, is sufficient compliance to qualify for the exemption provided by § 5-20.8-9. An expert may indicate, in writing, that the information provided will be used in fulfilling the requirements of this section.

(b) A home inspector, pest control operator or contractor who has provided and/or prepared a report or opinion, per §5-20.8-8(a) may not solicit, in writing or otherwise, to perform work on the property which has been the subject of the inspection to either a buyer or seller who has executed a purchase and sales agreement for the sale/transfer of the property. Nothing in this section restricts a buyer or seller from contacting the home inspector, pest control operator or contractor for this work to be performed. Nothing in this section restricts the solicitation of work by that home inspector, pest control operator or contractor, after the closing on the property as defined in § 5-20.8-1.

§ 5-20.8-9 Seller and agent liability. – Neither the seller nor agent is liable for any error, inaccuracy, or omission of any information delivered pursuant to this chapter if the error, inaccuracy, or omission was not within the personal knowledge of the seller or agent, was based on information timely provided pursuant to §§ 5-20.8-7 and 5-20.8-8 and ordinary care was exercised in obtaining and transmitting it.

§ 5-20.8-10 Subsequent acts. – If information disclosed in accordance with this section is subsequently rendered inaccurate as a result of any act, passage of time, occurrence, or agreement subsequent to the delivery of the required disclosures, the resulting inaccuracy does not constitute a violation of this section. If at the time the disclosures are required to be made, an item of information required to be disclosed is unknown or not available to the seller, the seller shall so state, and may use an approximation in responding.

§ 5-20.8-11 Lead inspection requirement.

(a) Every contract for the purchase and sale of residential real estate (1-4 family) built prior to 1978 located in the state shall provide that potential purchasers be permitted a ten (10) day period, unless the parties mutually agree upon a different period of time, to conduct a risk assessment or inspection for the presence of lead exposure hazards before becoming obligated under the contract to purchase.

(b) Failure to include the provision required in subsection (a) in the purchase and sale agreement for residential real estate does not create any defect in title; provided, that each violation of this section by the seller or his or her agent is subject to a civil penalty of not less than one hundred dollars ($100) nor more than five hundred dollars ($500).

(c) Failure to provide inspection results and/or educational materials pursuant to department regulations required by §23-24.6-16(a) does not create any defect in title; provided, that each violation of this section by the seller or his or her agent is subject to a civil penalty of not less than one hundred dollars ($100) nor more than five hundred dollars ($500).

(d) Failure to include the purchase and sale agreement provision required in subsection (a); failure to provide inspection results pursuant to § 23-24.6-16(a); or inspection results which show a lead exposure hazard as defined at § 23-24.6-4(9) entitle the purchaser to void the purchase and sale agreement by providing notice in writing to the seller prior to the transfer of the title at closing.