Hazardous-Land Subdivisions—Jackson County, NC

September 15, 2009

Linda Cable, Jackson County Planning Director
Jackson County Planning Office
Suite A-258
401 Grindstaff Cove Road
Sylva, NC 28779

Dear Ms. Cable:

On May 6, 2003 roads designed and commissioned by Don Condren, a Haywood County developer, were damaged by landslides. These events raised the question of property owners' liability for roads in hazardous-land subdivisions. Horseshoe Cove, the subdivision under discussion, is located in Maggie Valley, North Carolina.

Horseshoe Cove property owners did not learn until after the fact that Mr. Condren had chosen a hazardous-land tract for their subdivision.

As you know, post-development, hazardous-land determination is of no consolation to aggrieved property owners. Under North Carolina law the responsibility for road maintenance and repairs is transferred from the developer to property owners at time of sale through a document titled the Subdivision Street Disclosure Statement.

Horseshoe Cove property owners, facing costly long-term litigation and the threat of developer's bankruptcy acknowledged responsibility and paid $300,000 to restore their roads. The Horseshoe Cove Subdivision remains at risk: the multi-million dollar landslide stabilization techniques recommended by McGill engineers were not undertaken.

Mr. Condren is currently doing business in Jackson County and received recommendation for his Rolling Hills Estates Major Subdivision application on September 11, 2008. In summary, the Planning Board Minutes show:

—Mr. Condren’s proposed, average 21% slope, subdivision construction site is exempt from landslide prevention studies mandated by the Mountain and Hillside Development Ordinance.

—The Rolling Hills Estates Homeowners’ Association has been established and is recorded-deed book 1747 page 545.

— Property owners will be advised on their Subdivision Street Disclosure Statements that they will be legally responsible for costs pertaining to roads and common areas.

The North Carolina standardized Subdivision Street Disclosure form as shown below may be a suitable conveyance document for no-risk building sites, but it is not an acceptable liability disclosure statement for Jackson County’s hazardous-land subdivisions.

Sample Subdivision Street Disclosure Statement

Pursuant to N. C. G. S. Section 136-102.6 _______, as the Declarant of _______,
issues this statement indicating that all of the roads within_______ are private. It is the obligation of _______ Homeowners' Association, Inc. (hereafter "Association") to maintain and keep in good repairs all of the private roads in _______Subdivision. It is mandatory for all property owners in _______ to be a member of the Association and the property owners, with the exception of the Declarant, have an obligation to pay assessments to maintain the private roads. The Declarant specifically states that the streets have not been constructed in such a manner to allow inclusion on the State highway system for maintenance.

Upon your advice and recommendation Jackson County passed the Hillside and Mountain Development Ordinance in 2007. This urgency measure stated that much of the county’s developable land was inherently unstable and thus hazardous.

With that said, Jackson County Subdivision Street Disclosure Statements are not comprehensive disclosure documents. A material fact—hazardous-land designation— has been omitted. The Jackson County Planning Board can correct this error by requiring the inclusion of a "Fair Warning" addendum on the disclosure statements. Property owners' liabilities linked to private road ownership are significant and developers must clearly state them. Before assuming responsibility for developers' roads, property owners should be apprised of the following:

This subdivision’s roads were built on likely unstable soils. Landslides and erosion are recognized chronic hazards above a 15% slope. Soil assessments for this subdivision can be found at the county Soil & Conservation Office. Jackson County did not require geotechnical, hydrologic or soil studies for this subdivision. Should this subdivision’s roads be damaged by predictable natural occurrences, the members of the homeowners’ association will be liable for all repairs.

The absence of material information on Jackson County Subdivision Street Disclosure Statements presents unconsidered liability issues. If the Subdivision Street Disclosure Statement is found to be an invalid conveyance document, what legitimate claims could injured parties bring against those involved in the development and sale of said properties?

Thank you for your interest in this matter.

Lynne Vogel
WNCSOS
232 Wonderly Lane
Mars Hill, North Carolina 28754