The Island Advocate

If you are like most Islanders (like me) you love to go out Boating on Lake Erie in Ohio. However, it is important to know the rules of the Road or in thisAs we all know, Kelleys Island is a HOT Real Estate Market. If you are buying or selling property here or at your principal residents, some basic rules and concepts can keep you out of legal trouble whether you are a buyer or seller and save you from legal headaches and pitfalls.

1. The purchase contract controls
   In Ohio, the written purchase agreement is critical. It should clearly address: Purchase price and earnest money, financing and appraisal contingencies, inspection rights, Title requirements, Closing date, possession, Personal property included, Risk of loss before closing and What happens if either party defaults. Oral agreements generally are not enforceable.
   
2. Ohio is generally a “buyer beware” state—but with important exceptions; Ohio follows the doctrine of caveat emptor, particularly for defects that Are open and observable; Are discoverable through reasonable inspection; and Do not involve fraud or misrepresentation by the seller. But the seller cannot intentionally conceal a material defect or make fraudulent misrepresentations.
   
3. Sellers must disclose known material defects
   A seller generally should disclose known conditions that materially affect the property’s value or desirability and are not readily observable. Some Examples might include: Significant water intrusion, Structural problems; Known roof defects, Substantial foundation issues, and certain environmental problems.
   
4. The buyer should inspect everything
   A buyer should not depend solely on the seller’s disclosure. Hire a Professional Home Inspector! However, a home inspection is not a substitute for investigating whether the property can legally be used for the buyer’s intended purpose.
   
5. Title is a separate issue from condition
   The buyer should obtain a title examination and usually title insurance.
   Practical rule: You are buying the property—and potentially its legal history.
   
6. Taxes and assessments must be addressed at closing
   Ohio property taxes are paid in arrears. The purchase contract and closing statement typically prorate taxes between buyer and seller.
   
7. Zoning is not guaranteed by the seller
   If a buyer intends to Build, Expand, Operate a business, Convert a property, Develop land, Use a property for a special purpose the buyer should independently confirm zoning and other governmental approvals. Never assume that because something exists, it is legally permitted—or that a prior use guarantees the right to continue it.
   
8. The deed matters
   The type of deed determines the warranties being conveyed.
   Ohio commonly uses:

• General warranty deed
• Limited warranty deed
• Quitclaim deed

A quitclaim deed generally provides the least protection because the grantor conveys whatever interest the grantor has, without the same type of title warranties.

9. A real estate agent does not replace a lawyer
   A real estate agent can help negotiate and facilitate a transaction, but an attorney is particularly important to review the transaction, especially if it is not a typical real estate transaction.

• Commercial properties
• Development issues

To Summarize
Buyer: Inspect, investigate, and verify.
Seller: Disclose, don’t conceal, and document.
Both: Put everything in writing and make sure the title is clean.

Keep these tips in mind when buying or selling property whether its your vacation paradise or your principal home.

Dean DePiero DEPIERO LAW
(Attorney DePiero also serves as the Kelleys Island Mayors Court Magistrate and has been an “Islander” since 2002)