Agent Duty to Provide Copy of Termite Certificate

This week we continue with a series of emails that will continue over the next several weeks where we will analyze Louisiana Court cases dealing with the duties of real estate agents and how agents breached their duties in some of those cases.

Hopefully, the readers of this email will learn more about what duties are placed on Louisiana real estate agents and how not to breach those duties.

This week, we will discuss below a Louisiana 1st Circuit Court of Appeals case dealing with an agents’ failure to provide a termite certificate to her client prior to closing.

Reeves vs. Weber, 509 So.2d 158 (La. App. 1 Cir, May 27, 1987)

On November 15, 1982, Mr. and Mrs. Horace Reeves purchased a house in Ponchatoula, Louisiana.  On the day of closing, buyer signed a termite certificate that stated:

  1. the house was termite infested,
  2. the house had been treated,
  3. the house had visible damage to the wood in contact with the ground.

 

Buyer stated that while he signed the termite certificate at closing, he did not read it prior to signing it.

On February 8, 1983, buyer discovered the termite damage when he had his house exterior cleaned with a high pressure washer.  On May 8, 1984, (i.e. more than one year after discovery of the defect), buyers filed a lawsuit against the real estate agent.

The trial court held that buyers had ten (10) years to file a lawsuit against their real estate agent.  Additionally, the trial court held that the real estate agent had possession of the termite certificate prior to closing and, thus, possessed knowledge of the termite damage but failed to provide this information to the buyer prior to closing.

The real estate agent appealed.

On appeal, the 1st Circuit Court of Appeals held buyers had one (1) year to file a lawsuit against their real estate agent, not ten (10) years.  Since buyers filed their lawsuit outside of one year from the date of discovery of the termite damage (i.e. Buyers discovered the termite damage on February 8, 1983, but did not file their lawsuit until May 8, 1994), buyers failed to timely file their lawsuit and the 1st Circuit Court of Appeals dismissed the lawsuit.

The 1st Circuit Court of Appeals did not address whether the real estate agent breached a duty by failing to provide buyers with the termite certificate prior to closing.

A couple of things to note from this case:

  1. Since the trial court found the real estate agent breached a duty by failing to provide the buyers with the termite certificate prior to closing, there is a chance the Court of Appeals would have ruled likewise;
  2. Realtors should always provide their clients with a copy of the termite certificate prior to closing and it’s a good idea to transmit this information in writing either by email, fax, or mail and confirm that the client received the termite certificate.

 

For any questions concerning this email, please contact me at rye@tutentitle.com.

H.L. “Rye” Tuten, III, is a Title Attorney/Real Estate Closing Attorney and Owner of Tuten Title & Escrow, LLC. Formerly assigned by RICE Insurance to defend real estate agents throughout Acadiana, much of his more than nine years’ litigation experience is with real estate concerns.

The information contained herein is simply for informational purposes only and not intended to provide legal advice or create an attorney-client relationship.