Consumer Law, Warranties Condominium purchase and sales agreement

[shrlook]

My jurisdiction is: massachusetts

Does a condominium Purchase and sales agreement become a part of the deed? My agreement and deed cite condominium statute compliance and there is none and has been none for 20+ years. Does this void my deed?..since I never received what I thought I purchased? Any help appreciated.

 

[Michael Wechsler]

I don't know the law in your state but my understanding is that a written agreement is required to purchase real estate but a deed transfer is not "void" simply because the written agreement does not exist. At the very worst, here's a great idea - you have acquired the home by adverse possession - notorious and open possession at the expense of the current land owner. In the states I'm aware, this length of time is never longer than 20 years - and as a result, you've acquired possession. This is not a legal opinion, just my observation of the facts you've provided.

 

[shrlook]

Maybe I'm having brain fog today but I'm not understanding your reply. I have a completed, signed P&S. It states that I will be receiving a condominium in compliance with state condo law. It was/is not. The deal is completed and the property has been deeded to me. I took out a mortgage on the property. The developer did not follow state statute for 20+ years before I bought, and the property is still non-conforming. The issues are ones a general home inspection would not discover, and the developer did not/ has not disclosed problems. What legal options are there to "give" the property back to the developer and recoup my losses?

 

[Michael Wechsler]

OK - now I understand. I thought you had lived in the property for 20 years and were worried about it not being owned by you. Different story. You're saying that you're worried that the developer may not have followed statute and thus couldn't provide perfect title to you. But it sounds to me as though the title given to you was adequate but the property isn't allegedly conforming to what is represented in the contract and since you don't want the property, you're hoping to hand the property over to the developer, get your money back and call it a day. Normally you'd have title insurance and they would investigate and report problems with title. If you bought it from a developer, I would think that every owner in your building would have the same problem. I still don't know what the nonconforming issues are but it doesn't sound like it's a title related issue.

 

[shrlook]

I agree that all the issues involve all the owners. The Master Deed descriptions are totally inaccurate (pages and pages), building plans are wrong (copied one drawing 6 times but not all built identically), unit plans are inaccurate (some one bedroooms are two/two bedrooms are one),there is no way that the buildings can be rebuilt as is since the drawings are so messed up. Though condominiumized 20+ years ago, one of seven lots is third party owned and taxed. So how can the owners be 100% vested in the common areas?...oh, the list goes on and on. Are these issues that affect title? I do have an owners policy.

 

[Michael Wechsler]

Is nobody else aware of the problems? Why weren't they discovered earlier? Did anyone sue the developer? What about insurance? What is the remedy you seek? What are your damages?

 

[shrlook]

I discovered all these issues after the fact. When I found out the condo fees weren't set according to the Master Deed percentages of interest, I began digging into everything. The Board is aware, and other owners are aware, but so far all that has been done is change the monthly fee on the owners who complained and have units that are switched around. We are going into litigation now, but the document errors are not part of the suit. Only the fact that lack of maintenance has caused financial disaster. When I approached association attorney about the docs I was told that recission is impossible since we cannot give the properties back exactly as they were when purchased since too much time has elapsed.
The only insurance owners have is there personal condo insurance and/or owners and lenders title insurance. The association has a master policy though. Would this cover these issues? I want out of course. Try selling in a down market in an association in litigation and in total disrepair. The only sales here are foreclosures selling for less than half of original purchase price.
I see my damages to be my purchase price and condo fees that have escalated by more than 100% in three years, with a notice tonight that there will be another $100 increase beginning in September, and the possibility that a loan will be taken to do repairs thereby raising fees or monthly assessment per unit.
I would like to find a legal way out, other than a short sale (been there, tried that) so that my credit won't be ruined. Are these title issues, especially the land part? Can I get my title insurance to buy me out? And how hard will that be? What about my lender? There collateral is compromised. If I stop paying and give them the info what are my chances?

 

[Michael Wechsler]

Unfortunately, my only thought is this, with my sincerest sympathies - "welcome to the club of defrauded citizens." Many of us are in the club, whether it is stock, real estate - you name it. There is no legal recourse except the endless lawsuits that will occur. Quite frankly, I'm wondering whether it is a matter of time until people take the law into their own hands since the legal redress seems to be far too expensive, time consuming, and unsatisfactory, especially given the huge number of cases to be addressed.

Remember this - who is going to pay more for your land today than it's worth? Nobody. Why should they? Why should your lender buy you out? In fact, they had nothing to do with the issue at all except give you money for the property. It's all about who bears the risk that the builder was a complete scandalous criminal. There are now possibly millions of these people who took the money and are now laughing at the people they took the money from to get it back.

The best I can say and I'm sure it's been tried - figure out who, if any, might have been responsible for making sure everything was as represented to you. It's not a title issue. Was there some type of inspection that was to be performed that should have uncovered this issue? Was that responsibility yours alone? I don't know. I do know this - there are millions of people who were sold poor deals and are now believing that someone has to bear their loss. Unfortunately, like many others, you may now need to sell what you have to pay for this criminal act by a builder and now live more modestly.

Personally, I'm infuriated. As I said, I just wonder how long it might be until this kind of mass fraud rears its ugly head because not enough has or can be done to address the egregious wrongs perpetrated by the likes of your builder.

 

[shrlook]

Thanks so much for your time and interest. As you said, I'm just one of many. I have a hard think ahead. If anything exciting happens, I'll write again. Best, Sharon

 

[shrlook]

I saw a reply in another thread, which I cannot find right now--something about not getting the benefit of the bargain being fraud? Getting back to title insurance, everything I have researched online says that fraud is a coverable defect in title. Will I benefit from my owners title insurance policy for fraud, since the developer did not disclose issues prior to my sale?

 

[Michael Wechsler]

I saw a reply in another thread, which I cannot find right now--something about not getting the benefit of the bargain being fraud? Getting back to title insurance, everything I have researched online says that fraud is a coverable defect in title. Will I benefit from my owners title insurance policy for fraud, since the developer did not disclose issues prior to my sale?

Fraud for what? If the title insurance covers fraud for title, e.g. a fake deed, then you'd have a case. Does the deed, as is, make the property unmarketable? Is it correctible? If it doesn't make the property unmarketable, you're stuck with it. If it does and can be corrected, you're still stuck with the property.

I wonder if you're going on a wild goose chase trying desperately to find someone else to bear your loss and need to focus on how to attack a large problem or defect. I'm not telling you to stop trying. I'm just saying that if you want to make a drastic action you need to find a drastic error. If everyone else is in the same boat, then all of you will have the same loophole or none at all. That said, what if the builder went out of business? Where is the company or chain of companies involved? Will you need to find personal liability? It's not going to be easy and I am afraid that this country is going to be in a serious state of turmoil as a result of fraud and people's overextension of their financial responsibilities. I wish you the best of luck and glad to comment as I can.