The Best of the Legal Hotline: Winter Woes


 Tracy Rucka  |    January 10, 2022
Legal Hotline

Plowing and shoveling 

The seller has an accepted offer on his home and is set for closing late in January. The seller does not currently live in the home. The buyer is asking who will be taking care of snow removal for sidewalks and the driveway in the event that it snows prior to closing. Is the seller legally obligated to remove snow from the driveway prior to closing?  

The offer does not specifically address lawn care or snow removal. As for the driveway and private walkways, the maintenance provisions at lines 465-467 of the offer would apply to the seller’s obligation to maintain the property. If this is not acceptable, the buyer and seller may renegotiate to address the matter. Options include moving up the closing, allowing the buyer access to remove snow, having a third party hired, splitting costs or any other means of agreement to avoid a situation where more costly property damage could result. In addition, the seller is referred to the municipality about snow removal regulations. Depending on the local ordinances, the owner of the property will be responsible for snow removal. 

At the initial showing of the property and at the inspection, the roof was covered with snow. The buyer is concerned about the condition of the roof. How can the buyer negotiate about potential roof defects?

For a number of exterior items, full inspections may be limited due to the winter elements. For example, it is not uncommon for a home inspector to indicate that they could not make an accurate statement about the condition of the roof due to the snow accumulation on top of the roof. The home inspector typically indicates that they would be willing to come back out to inspect the roof at a time that weather permits such inspection.

Therefore, the parties in this situation often negotiate an after-closing escrow agreement. Real estate licensees are not authorized to draft escrow agreements; therefore, licensees may recommend the parties use the services of an attorney or draft their own agreement. 

Ice dams   

An offer was accepted prior to recent snow and ice storms. It was discovered the property now has damage due to ice dam buildup. The seller is repairing the damage to the roof and gutters, but the buyer wants out of the transaction saying the work is not up to the buyer’s standards. How should the parties proceed?

The first step is to refer the parties to the Maintenance and the Property Damage Between Acceptance and Closing provisions of the offer. Unless the parties agree to amend the offer, the seller is required to maintain the property in materially the same condition as of the time of the offer and repair and restore the property to that condition in the event of property damage less than 5% of the purchase price. The standard of repair in this section of the offer is “... restore the Property to materially the same condition it was in as of the date on line 1 ...” 

The second step is for the parties to consult with appropriate roof or gutter experts to determine if the work completed by the seller has met the contractual standard. Depending on the timing of the closing, the parties may consider amending to extend the closing so there is sufficient time to resolve the issue. Alternately, the parties may consider having an escrow agreement drafted by legal counsel to address the repairs post-closing.

Winterize and dewinterize    

A seller has a cabin listed for sale. Prior to the winter weather, the seller turned off heat and water and had a plumber winterize the property. The buyer wants to have well and water tests done. What is the best way to proceed in this scenario?

It is understandable a seller wants to secure the vacant property. This may, however, present a problem when the property is for sale and the inspectors or plumbers need to have the utilities on in order to conduct proper inspections or testing. Home inspectors will not ordinarily turn on water or other utilities, so planning for these inspections must be considered when drafting the offer. 

The standard home inspection contingency in the WB-11 Residential Offer to Purchase does not address the obligation to winterize and/or dewinterize the property or refer to winterized properties. This creates a question as to who is responsible to turn on the power or other utilities for the inspectors, who will turn them back off once the inspections are completed, and who will pay for these actions. Another question to consider is who will be responsible for any damage that occurs during the period when the power and water are on.

When the buyer knows the property is winterized, the buyer may discuss the winterization with the home inspector before the offer is written to find out exactly what the home inspector will need and on what schedule. In this regard, it is helpful of the listing agent to share the fact that the property is winterized, perhaps in private remarks in the MLS. The buyer can then draft the offer to specifically address the timing, responsibility, costs and liability for dewinterization and rewinterization. This will avoid later arguments and confusion.

The following provisions, taken from the 2019 edition of Wisconsin Real Estate Clauses, may be used or modified depending on the situation. Modifications should take into account power, water, other utilities, timing, costs, etc. The provisions from Wisconsin Real Estate Clauses read: 

If property is winterized, (Buyer)(Seller) [STRIKE ONE] (“Seller” if neither is stricken) shall have the Property de-winterized within ________ days of acceptance at (Buyer’s)(Seller’s) [STRIKE ONE] (“Seller’s” if neither is stricken) expense. Seller, at Seller’s expense shall have electrical and water activated with water meter installed and gas turned on to the Property prior to the home inspection. Buyer shall notify Seller in writing when inspections and testing are completed, Seller (shall)(shall not) [STRIKE ONE] (“shall” if neither is stricken) re-winterize the Property.

Wisconsin Real Estate Clauses, 2019 edition, is available for purchase at www.wra.org/Pub280.

A buyer did a final walk-through prior to closing and noticed the wood stove was missing from the barn. The property was advertised as “wood furnace in the barn to heat the barn.” The transaction is set to close today. How can the parties resolve this? Can the sellers offer a check to the buyer? In the future, is a wood stove a fixture? And what is the best way to address items like this?

Items like wood stoves, basketball hoops, porch swings and hot tubs are frequently the subject of calls to the WRA Legal Hotline. A wood stove isn’t specifically listed as a fixture in the offer to purchase, but that does not mean it is automatically personal property either. The parties would have to look further at the definition of “fixture” in the offer. The fixture definition on lines 26-36 of the WB-11 Residential Offer to Purchase defines a fixture as “an item of property which is physically attached to or so closely associated with land or improvements so as to be treated as part of the real estate, including, without limitation, physically attached items not easily removable without damage to the premises, items specifically adapted to the premises and items customarily treated as fixtures, including, but not limited to, all: … central heating and cooling units and attached equipment; ... CAUTION: Exclude any Fixtures to be retained by Seller … on lines 37-38.”

It would be the responsibility of both the listing and cooperating agents to make sure that the offer reflects the intended agreement of the parties regarding fixtures. Because the wood stove was not removed before the showings and before the date of the offer, the buyer may have assumed it was a fixture. The seller may have assumed it was personal property and not a fixture. If that is the case, then there may have been no meeting of the minds. For agents, the best practice going forward is to watch for those items that are not specifically listed in the offer and, if there is any chance the buyer or the seller might disagree on the interpretation of fixture, write the item into the offer as included or out of the offer as excluded according to the party’s instruction. If any item is disputed, the parties may agree to financial compensation to proceed with the closing.

Tracy Rucka is Director of Professional Standards and Practices for the WRA.


LEARN MORE AT WINTER CONVENTION

Workshop: “Working in a Winter Wonderland”
February 3 at 10:30 a.m.
Live in Green Bay
Instructor: Jennifer Lindsley, WRA Staff Attorney and Director of Training

Learn more about the effects of Wisconsin winters on real estate transactions in Jennifer Lindsley’s workshop at Winter Convention next month in Green Bay. Join the discussion and share your stories about the surprises a Wisconsin winter can cause in your transaction.

Register: www.wra.org/WinterWonderland

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