2023 Nebraska Revised Statutes › Chapter 76 - Real Property › 76-2,120 - Written disclosure statement required, when; contents; delivery; liability; noncompliance; effect; State Real Estate Commission; rules and regulations.

76-2,120.
Written disclosure statement required, when; contents; delivery; liability; noncompliance; effect; State Real Estate Commission; rules and regulations.
(1) For purposes of this section:
(a) Ground lease coupled with improvements shall mean a lease for a parcel of land on which one to four residential dwelling units have been constructed;
(b) Purchaser shall mean a person who acquires, attempts to acquire, or succeeds to an interest in land;
(c) Residential real property shall mean real property which is being used primarily for residential purposes on which no fewer than one or more than four dwelling units are located; and
(d) Seller shall mean an owner of real property who sells or attempts to sell, including lease with option to purchase, residential real property, whether an individual, partnership, limited liability company, corporation, or trust. A sale of a residential dwelling which is subject to a ground lease coupled with improvements shall be a sale of residential real property for purposes of this subdivision.
(2) Each seller of residential real property located in Nebraska shall provide the purchaser with a written disclosure statement of the real property's condition. The disclosure statement shall be executed by the seller. The requirements of this section shall also apply to a sale of improvements which contain residential real property when the improvements are sold coupled with a ground lease and to any lease with the option to purchase residential real property.
(3) The disclosure statement shall include language at the beginning which states:
(a) That the statement is being completed and delivered in accordance with Nebraska law;
(b) That Nebraska law requires the seller to complete the statement;
(c) The real property's address and legal description;
(d) That the statement is a disclosure of the real property's condition as known by the seller on the date of disclosure;
(e) That the statement is not a warranty of any kind by the seller or any agent representing a principal in the transaction;
(f) That the statement should not be accepted as a substitute for any inspection or warranty that the purchaser may wish to obtain;
(g) That even though the information provided in the statement is not a warranty, the purchaser may rely on the information in deciding whether and on what terms to purchase the real property;
(h) That any agent representing a principal in the transaction may provide a copy of the statement to any other person in connection with any actual or possible sale of the real property; and
(i) That the information provided in the statement is the representation of the seller and not the representation of any agent and that the information is not intended to be part of any contract between the seller and purchaser.
(4) In addition to the requirements of subsection (3) of this section, the disclosure statement shall disclose the condition of the real property and any improvements on the real property, including:
(a) The condition of all appliances that are included in the sale and whether the appliances are in working condition;
(b) The condition of the electrical system;
(c) The condition of the heating and cooling systems;
(d) The condition of the water system;
(e) The condition of the sewer system;
(f) The condition of all improvements on the real property and any defects that materially affect the value of the real property or improvements;
(g) Any hazardous conditions, including substances, materials, and products on the real property which may be an environmental hazard;
(h) Any title conditions which affect the real property, including encroachments, easements, and zoning restrictions;
(i) The utility connections and whether they are public, private, or community;
(j) The existence of any private transfer fee obligation as defined in section 76-3107; and
(k) Information relating to compliance with the requirements for a carbon monoxide alarm as provided in sections 76-604 and 76-605.
(5) The disclosure statement shall be completed to the best of the seller's belief and knowledge as of the date the disclosure statement is completed and signed by the seller. If any information required by the disclosure statement is unknown to the seller, the seller may indicate that fact on the disclosure statement and the seller shall be in compliance with this section. On or before the effective date of any contract which binds the purchaser to purchase the real property, the seller shall update the information on the disclosure statement whenever the seller has knowledge that information on the disclosure statement is no longer accurate.
(6) This section shall not apply to a transfer:
(a) Pursuant to a court order, a foreclosure sale, or a sale by a trustee under a power of sale in a deed of trust;
(b) By a trustee in bankruptcy;
(c) To a mortgagee by a mortgagor or successor in interest or to a beneficiary of a deed of trust by a trustor or successor in interest;
(d) By a mortgagee, a beneficiary under a deed of trust, or a seller under a land contract who has acquired the real property at a sale conducted pursuant to a power of sale under a deed of trust, at a sale pursuant to a court-ordered foreclosure, or by a deed in lieu of foreclosure;
(e) By a fiduciary in the course of the administration of a decedent's estate, guardianship, conservatorship, or trust except when the fiduciary is also the occupant or was an occupant of one of the dwelling units being sold;
(f) From one or more co-owners to one or more other co-owners;
(g) Made to a spouse or to a person or persons in the lineal line of consanguinity of one or more of the transferors;
(h) Between spouses resulting from a decree of dissolution of marriage or a decree of legal separation or from a property settlement agreement incidental to such a decree;
(i) Pursuant to a merger, consolidation, sale, or transfer of assets of a corporation pursuant to a plan of merger or consolidation filed with the Secretary of State;
(j) To or from any governmental entity;
(k) Of newly constructed residential real property which has never been occupied; or
(l) From a third-party relocation company if the third-party relocation company has provided the prospective purchaser a disclosure statement from the most immediate seller unless the most immediate seller meets one of the exceptions in this section. If a disclosure statement is required, and if a third-party relocation company fails to supply a disclosure statement from its most immediate seller on or before the effective date of any contract which binds the purchaser to purchase the real property, the third-party relocation company shall be liable to the prospective purchaser to the same extent as a seller under this section.
(7) The disclosure statement and any update to the statement shall be delivered by the seller or the agent of the seller to the purchaser or the agent of the purchaser on or before the effective date of any contract which binds the purchaser to purchase the real property, and the purchaser shall acknowledge in writing receipt of the disclosure statement or update.
(8) The seller shall not be liable under this section for any error, inaccuracy, or omission of any information in a disclosure statement if the error, inaccuracy, or omission was not within the personal knowledge of the seller.
(9) A person representing a principal in the transaction shall not be liable under this section for any error, inaccuracy, or omission of any information in a disclosure statement unless that person has knowledge of the error, inaccuracy, or omission on the part of the seller.
(10) A person licensed as a salesperson or broker pursuant to the Nebraska Real Estate License Act shall not be required to verify the accuracy or completeness of any disclosure statement prepared pursuant to this section, and the only obligation of a buyer's agent pursuant to this section is to assure that a copy of the statement is delivered to the buyer on or before the effective date of any purchase agreement which binds the buyer to purchase the property subject to the disclosure statement. This subsection does not limit the duties and obligations provided in section 76-2418 or in subsection (9) of this section with respect to a buyer's agent.
(11) A transfer of an interest in real property subject to this section may not be invalidated solely because of the failure of any person to comply with this section.
(12) If a conveyance of real property is not made in compliance with this section, the purchaser shall have a cause of action against the seller and may recover the actual damages, court costs, and reasonable attorney's fees. The cause of action created by this section shall be in addition to any other cause of action that the purchaser may have. Any action to recover damages under the cause of action shall be commenced within one year after the purchaser takes possession or the conveyance of the real property, whichever occurs first.
(13) The State Real Estate Commission shall adopt and promulgate rules and regulations to carry out this section. By January 1, 2017, the commission shall adopt and promulgate rules and regulations to amend the disclosure statement prepared pursuant to this section to be in compliance with the requirements of subdivision (4)(k) of this section.
Source
Laws 1994, LB 642, § 1;
Laws 2002, LB 863, § 1;
Laws 2011, LB26, § 13;
Laws 2015, LB34, § 8.
Cross References
Nebraska Real Estate License Act, see section 81-885.
Annotations
Attorney fees are mandatory for a successful plaintiff in an action under subsection (12) of this section. Pepitone v. Winn, 272 Neb. 443, 722 N.W.2d 710 (2006).
Disclosure statements under this section are required for the sale of any property containing at least one and not more than four dwelling units. A seller of residential property who fails to provide a disclosure statement pursuant to this section is not strictly liable for unknown defects. R.J. Miller, Inc. v. Harrington, 260 Neb. 471, 618 N.W.2d 460 (2000).
If a conveyance of real property is not made in compliance with this section, the purchaser shall have a cause of action against the seller and may recover the actual damages, court costs, and reasonable attorney fees. Hutchison v. Kula, 27 Neb. App. 96, 927 N.W.2d 373 (2019).
Sellers must complete the disclosure statement to the best of their belief and knowledge as of the date it was completed and signed, and as they are otherwise required by law to update before closing on the property. Hutchison v. Kula, 27 Neb. App. 96, 927 N.W.2d 373 (2019).
To state a cause of action under this section, the buyer must plead and prove either that the seller failed to provide a disclosure statement or that the statement contained knowingly false disclosures by the seller. Hutchison v. Kula, 27 Neb. App. 96, 927 N.W.2d 373 (2019).
Although this section indicates that the purchaser "may" recover attorney fees, attorney fees under this section are mandatory if the seller fails to comply with statutory requirements for a disclosure statement. Nelson v. Wardyn, 19 Neb. App. 864, 820 N.W.2d 82 (2012).
A seller is not liable for any error, inaccuracy, or omission in a disclosure statement which was not within the seller's personal knowledge. Thus, violations of this section must be done knowingly. Burgess v. Miller, 9 Neb. App. 854, 621 N.W.2d 828 (2001).
The buyer's knowledge of undisclosed damage in a cause of action for failure to provide a disclosure statement is relevant on the extent of damages, but does not provide a total defense. Burgess v. Miller, 9 Neb. App. 854, 621 N.W.2d 828 (2001).
Seller violations of this section must be done knowingly. A purchaser's knowledge of undisclosed damages is relevant to damages, but does not provide a total defense. Bohm v. DMA Partnership, 8 Neb. App. 1069, 607 N.W.2d 212 (2000).
This section provides a purchaser with a new cause of action in addition to other common-law and statutory causes of action available to purchasers of real estate. Although a disclosure statement is not a warranty, a purchaser may rely on the information contained in the disclosure statement. Information provided in disclosure statements are representations of the seller, not the seller's agent, and such information is not intended to be part of any contract between the seller and purchaser. Bohm v. DMA Partnership, 8 Neb. App. 1069, 607 N.W.2d 212 (2000).