Geologic Hazard Disclosure Laws: Why They Make Sense
| Publication year | 2006 |
| Pages | 5 |
| Citation | Vol. 19 No. 3 Pg. 5 |
Vol. 19, No. 3 - #5. Geologic Hazard Disclosure Laws: Why They Make Sense
Utah Bar Journal
Volume 19, No. 3
May/June 2006
Volume 19, No. 3
May/June 2006
Geologic Hazard Disclosure Laws: Why They Make
Sense
by Stephen Cranney and Trevor Salter
The population of Utah County is projected to double in just
25 years,1 creating tremendous demand for new housing. Such
development is often built close to the mountains. This land
is often geologically hazardous. Hazardous land is designated
as such by state and federal geologic agencies as having an
increased risk of mudslides, floods, earthquakes and other
natural disasters. One recent example of the risks associated
with hazardous land development is the Cedar East Townhomes
subdivision in Cedar Hills, Utah County
Nestled at the mouth of American Fork Canyon on a mountain
bench, Cedar Hills is one of the fastest growing Utah
communities. The demand for plots with scenic views has led
to significant construction along the foothills. In 2000 a
geologic study of the land designated for the Cedar East
Townhomes subdivision found it unsafe to build there. Another
study done in 2002 contradicted that report which highlights
the inherent scientific uncertainty and, at times, guesswork
that is involved in hazardous land use decisions
Nevertheless, the city gave developers permission to build
Having no legal obligation to do so, the developers failed to
notify the buyers of potential risks due to geologic hazards
making the inhabitants unaware of the potential serious
consequences of their purchase.
On April 28, 2004, a portion of a hillside above Cedar East
Townhomes began slowly moving down the hillside and into a
fourplex. The ensuing damage absorbed by the complex forced
the evacuation of its inhabitants and eventually necessitated
the destruction of the townhouses. The homeowners were
reimbursed for their mortgages, closing costs and temporary
housing by the developers. While the developers made
admirable recompense to the homeowners, might the homeowners
be better served if the risks were disclosed to them before
they purchased? This article posits that mandatory disclosure
laws benefit all parties in real estate transactions - the
seller, buyer and the municipality that approves new
subdivisions. A brief historical review of real estate
disclosure law will be followed by a discussion of the
universal benefits resulting from disclosure. The question of
scientific uncertainty will also be examined in the light of
disclosure laws. Finally, this article will present some
specific recommendations for the Utah State Legislature in
considering enacting disclosure statutes.
Background of Disclosure Law
The history of disclosure regulations of properties on
geologically hazardous land is ambiguous not only in Utah,
but also in much of the United States. The prevailing rule
for a long time was caveat emptor, "let the
buyer beware." In other words, the buyer was solely
responsible for defects of purchased products. Caveat
emptor assumed the equal ability of buyer and seller to
access product information. This principle peaked in the
laissez-faire, pro-business climate of the late 19th century.
But since the early 20th century, courts have started to
suggest that it is unreasonable for a buyer to understand all
the factors at the same level of the seller.2 With some
exceptions,3 courts have generally restricted caveat
emptor. One law professor summarized the prevalent
jurisprudence: "We should not realistically expect a
purchaser to check the county clerk's office, the
planning and zoning commission files, the Army Corps of
Engineers, the United States Geologic Society, the state
geologist, other agencies, and the internet..."4
State legislatures around the country have been even clearer
than the courts. About half of U.S. states currently require
disclosure laws of...
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