Thursday, January 3, 2008

Western North Carolina Realtors Fail to Disclose Material Risk

Photo of landslide in Maggie Valley, North Carolina (Haywood
County) Cause of landslide is unknown . In December 2003 a
Maggie Valley home was destroyed by a landslide. Edward Jones
and his wife Patricia were at home when the slide occurred. Mr.
Jones was rescued but his wife did not survive.

How important is your safety?

It is not in the news and most people have forgotten that landslides devastated Western North Carolina in September 2004, lives were lost and homes and roads were pushed down mountain slopes. Since then this twice declared disaster region has become a developers' playground. Bulldozers and backhoes work at breakneck speed to carve out idyllic mountain settings for resorts and homes. This prime or perhaps subprime property is then advertised and sold to unsuspecting buyers. State authorities have known since 1983 that Western North Carolina's mountain ridges and slopes were high risk building locations yet they continue to allow the development and sale of this hazardous land without regulation and risk disclosure.

Today North Carolina lawmakers are studying this important public safety/disclosure measure. Some legislators have suggested that these issues be put on hold until 2014 when all of the at risk counties will have been mapped by the North Carolina Geological Survey.

On January 2, 2008 Representative Ray Rapp spoke with Becky Johnson of the Smokey Mountain News about his inability to gather support for safe slope regulations and disclosure of landslide risks. According to Ms. Johnson's article, Rapp is not a fan of the "caveat emptor" motto that has prevailed in WNC's development boom. Rapp said that buyers simply don't know to beware. Rapp continued, "All they see is a million-dollar view. They are looking at the view not at their feet-and what is underneath their feet could be highly detrimental to their safety." For the complete article please see "Rapp tries to round up support for slope development bill."

Ron DeSimone, President of the Haywood Builders Association, stated the following in his October 2007 News Letter: "Like it or not, what the government does and doesn't do has a direct and fundamental impact on your business. Whether you are a builder or associate member, you should be aware that your industry is under assault. "No growth" groups and radical consumer advocates have advanced proposals which--had they been enacted--would have made it harder, if not impossible, for you to make a living. The governmental affairs staffs of both your national and state association, with your help, have been able to derail many of these bad ideas. All of these decisions were made by local officials or those appointed by them. More of these "bad ideas" are coming! Fortunately both in the U.S. Congress and in our North Carolina General Assembly, our industry has many friends....Landslides and
environmental issues are fairly rare and most builders and developers are trying hard to create desirable communities that promote the mountain environment. This is not to diminish the gravity of the problem, or to say that some regulation isn't needed; however, it is important to put things in perspective."

According to a July 2007 article written by Tom Bennett for the Hiawassee River Watershed Coalition, Inc., Rick A. Zechini, director of governmental affairs for the North Carolina Association of Realtors sent e-mails to Realtors throughout the state. In these April 2007 messages Mr. Zechini discussed two concerns facing North Carolina Realtors. The first was the possibility that the legislature would enact safe slope regulations and the second was that prospective buyers would be forewarned of landslide risks. For more information about the Safe Artificial Slope Construction Act and the actions of the North Carolina Association of Realtors please see Mr. Bennett's article "Artificial Slopes".

Even though the North Carolina legislature and the Office of the Attorney General have declined to require fair warning for the sale of hazardous land, this does not absolve Realtors from the legal responsibility of disclosing the material fact that slope failures have and will continue to cause loss of life and significant uninsurable property damage.

North Carolina provides that unfair or deceptive acts or practices in the conduct of any trade or commerce are unlawful and are subject to a civil injunction by the Attorney General.

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