Legal Hotline
By Chris Darby, Tom Muldoon and John Nalls of Counselors Title, LLC, and Pardo & Drazin, LLC, General Counsel
QUESTION: Does my role or responsibility
as a listing agent change if my client will be using a 1031 Exchange when selling their investment property?
ANSWER: Your role in the transaction does not
change. You will want to ensure that your client is using a Qualified Intermediate to properly handle the 1031 Exchange and complying with the requirements of the IRS Tax Code.
QUESTION: If you have a seller with a security
camera all around his house, do you need to disclose that to the visitors, agents or buyers?
ANSWER: This is a complicated issue for which
some, but not all, jurisdictions have laws regarding required disclosures and/or the disconnection of audio recordings during showings or open houses. GCAAR has attempted to address the matter of making buyers aware that surveillance systems may record conversations in sellers’ homes in GCAAR Form 1318, Important Information for the Purchase of Real Estate: 18. SECURITY SYSTEMS/ELECTRONIC DEVICES: Buyer is advised that Seller may have a system 26
CAPITAL AREA REALTOR ® — March/April 2021
on Seller’s property that records audio and/or video. If so, Buyer’s actions and/or conversations could be heard, recorded and/or seen. The Montgomery County Jurisdictional Addendum to the Listing Agreement (GCAAR Form #909) also has a paragraph notifying sellers of Maryland’s law on this topic: 7. HOME SECURITY SYSTEMS THAT MONITOR OR RECORD AUDIO: Seller is advised that Maryland law prohibits audio recording and/ or monitoring of private conversations without the consent of all parties. NAR has also published a survey of various jurisdictions’ laws on this subject that can be found at: bit.ly/2OYlaSf. The short answer is that, while technology seems to increasingly create an environment where recordings are regularly taking place in many people’s homes, it would be a good idea for sellers to affirmatively disclose this possibility. That means disclosing where they know recordings are taking place. And in places like Maryland, where the law actually requires consent for audio recordings, such devices should be disconnected during open houses and showings.
