October 15, 2001

REALEGAL® Issue 38
A Legal Update From The California Association of REALTORS®

Toxic Mold Update

NEW MOLD SECTION IN ENVIRONMENTAL HAZARDS BOOKLET

The environmental hazards booklet has been revised to include a chapter on mold. Although the booklet has a technical revision date of January 1, 2002, REALTORS® may wish to insert the new 4-page mold chapter into their current environmental hazards booklets now for their current transactions. By doing so, REALTORS® can get this valuable information from the Department of Health Services ("DHS") into the hands of their clients immediately and enjoy the legal protections that providing that information will give. You may download this new section by clicking on /library/media/papers/pdf/Mold.pdf, copy it and insert it into existing Environmental Hazards Booklets immediately while waiting for the new booklets to be printed and released by C.A.R.

TOXIC MOLD PROTECTION ACT SIGNED.

The Toxic Mold Protection Act (SB 732) contains some mold disclosure requirements for real estate transactions. The Transfer Disclosure Statement (“TDS”) used in the sale of residential 1-4 units will include a question on mold effective January 1, 2002. The new C.A.R. TDS-11 form will be available for purchase sometime in November.

For residential rentals, there will be new requirements for a landlord to disclose to prospective tenants or current tenants of affected units when the landlord "knows or has reasonable cause to believe… that mold is present or exceeds permissible exposure limits" . Although CAR objected to the "reasonable cause to believe" standard as being too difficult, all other landlord groups did not oppose this provision. This part of the law will become effective six months after standards for mold exposure limits are determined. Residential landlords will also have to give tenants a copy of a consumer - oriented environmental hazards booklet describing the health risks of mold. The requirement to provide the booklet will take effect six months after the booklet is approved. There are also other new requirements for Commercial and Industrial (sales and rental) properties.

Unrelated to this bill, C.A.R. has included a reference to mold in the Environmental Hazards section (paragraph 9) of the Buyer's Inspection Advisory that is used with the C.A.R. Residential Purchase Agreement.

C.A.R. members may obtain a copy of C.A.R.’s Question and Answer on this topic with further details when that document is released later this month. We will notify you once it is available on . A copy of the actual law is available now at /index.php?id=MzY1Mg==. Members should direct all questions to the C.A.R. Legal Hotline at (213) 739-8282.
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