RANM REALTOR® Voice | Fourth Quarter 2008 Legal Corner

What Does It Mean When We Say New Mexico Is A “NON-DISCLOSURE” State?

Legal Corner provides a limited and general discussion of some, but not all, aspects of issues that is intended but not guaranteed to be accurate as of the date published. Th is information may become outdated and it is the responsibility of the user to determine if it is current. No summary of the law is a substitute for legal advice with respect to a particular matter. No attorney-client relationship is intended or implied. If legal advice is required, the services of a competent attorney should be obtained. RANM members are cautioned against engaging in the unauthorized practice of law by advis-ing a consumer of legal rights and obligations or by applying the law to particular facts and circumstances. © 2008 REALTORS® Association of New Mexico .

Legal Corner is researched and written by Ashley Strauss-Martin, RANM Legal Hotline and Forms attorney.

REALTORS® Ability to Sell Manu-factured Homes in Great Debate

4

You are posting your sign in the yard

of a new listing when a man stops and

inquires about a house that sold in the

neighborhood. Th e house was not your

listing, but you know the home’s sale price

from the posting on your local MLS. Are

you permitted or prohibited from answer-

ing his question?

Th e fact that New Mexico is a “non-dis-

closure” state (or probably more accurately

a “partial-disclosure”

state) has caused a

considerable amount

of confusion among

brokers. Many

believe that due to

New Mexico’s status,

it is illegal to disclose

the sales price of

a specifi c piece of

property. While

some New Mexico bro-

kers may be wise to refuse to discuss the

sales price of a specifi c piece of property

with a member of the general public, their

rational is erroneously derived; it is not

this New Mexico statute that prohibits

them from doing so.

Th e New Mexico law that governs this

issue is NMSA 1978, Section 7-38-4,

entitled “Confi dentiality of Information”,

which states the following:

. . . it is unlawful for the secretary, any

employee or any former employee of

the department to reveal to any person

other than the secretary, an employee of

the department, a county assessor or an

employee of a county assessor any infor-

mation gained during his employment

about a specifi c property or a property

taxpayer gained as a result of a report

or information furnished the depart-

ment or a county assessor by a taxpayer

or as a result of an examination of

property or records of a taxpayer.

. . . it is unlawful for any county asses-

sor or any employee or former employee

of a county assessor to reveal to any

person other than county assessors or

their employees or the secretary or an

employee of the department any infor-

mation furnished by the department

about a specifi c property or property

owner or any other information gained

during that person's employment about

a specifi c property or a property tax-

payer gained as a result of a report or

information furnished the department

or a county assessor by a taxpayer or as

a result of an examination of property

or records of a taxpayer.

Th e section goes on to explain the

circumstances under which such informa-

tion may be released.

As evidenced by the statute, the prohibi-

tion against releasing the value or sales

price of a specifi c piece of property applies

to government employees, not to private

citizens. Th erefore, a broker who is asked

for the specifi c sales price of a piece of

property is not violating this New Mexico

statute by providing that information.

However, a broker may still be prohibited

from providing sales price information

based on MLS policy, their legal relation-

ship with the client, and/or their contrac-

tual obligations.

NAR advises local MLSs to choose one

of two options in NAR’s MLS Policy,

Part Th ree, Section F, Sub-Section 13

entitled “Use of MLS Information”.

Option #1: Use of information from

MLS compilation of current listing

information, from the association’s

statistical report, or from any sold

or comparable report of the associa-

tion or MLS for public mass-media

advertising by an MLS participant

or in other public representations

may not be prohibited. . . .

Option #2: Information from MLS

compilations of current listing infor-

mation, from statistical reports, and

from any sold or comparable report

of the association or MLS may be

used by MLS participants as the

basis for aggregated demonstrations

of market share or comparisons of

fi rms in public mass-media adver-

tising or in other public represen-

tations. Th is authority does not

convey the right to include in any

such advertising or representation

information about specifi c properties

which are listed with other partici-

pants, or which were sold by other

participants (as either listing or

cooperating broker). . . .

If your local MLS has selected Option #1,

in the scenario above, you may answer the

inquirer’s question regarding the specifi c

sales price of the home. However, if your

local MLS has selected Option #2, then

it is against your MLS’s policy to provide

the sales price of a specifi c property if you

were not the listing broker and if your

knowledge of the sales price came from

MLS information. Th is does not prohibit

you from providing an average sales price

for the neighborhood or a range of sales

prices for the area. Th e following MLSs

have reported selecting the indicated op-

tion: the New Mexico Multi-Board, Op-

tion 1; the Southwest MLS, Option 2; the

Santa Fe MLS, Option 1; the Las Cruces

MLS, Option 1. If your local MLS is not

listed, please contact them to determine

which option they have selected.

Under Option #2, if you were the listing

broker for the prop-

erty at issue, you may

disclose the sales price

of the home without

violating MLS policy;

however, your legal

relationship with your

client and/or your con-

tract with your client/

customer may prohibit

such disclosure. If you

have an agreement with

your client not to disclose the sales price

information to third parties then you may

be in breach of your agreement if you do

so. If you had an agency agreement with

your seller, depending on several factors,

you may be bound by fi duciary duties not

to disclose the sale price. Th ese two sce-

narios would require further legal analysis

based on the individual circumstances.

Based on the foregoing, if not listed,

you should determine to which, if either

Over the last six months, it has been the

position of the New Mexico Manufac-

tured Housing Division (MHD) that a

real estate licensee may not sell or off er

to sell a manufactured home unless

three criteria have been met: 1) the

home sits on a permanent foundation as

approved by the MHD; 2) the title to

the manufactured home has been deac-

tivated with the Department of Motor

Vehicles; and 3) the property was being

taxed as real property by the county as-

sessor’s offi ce. RANM was told by the

MHD that REALTORS® who were

in violation of this law would be subject

to severe penalties and the manufac-

tured homes that REALTORS® were

attempting to sell would be red tagged.

Th e MHD’s position is based on its

interpretation of NMSA 1978, Section

60-14-8 which addresses the exception

to the manufactured housing licensing

requirements for real estate licensees.

While informing REALTORS® of the

MHD’s position, RANM has also been

challenging the MHD’s interpreta-

tion of NMSA 1978, Section 60-14-8.

Please watch RANM OnLine News for

more information and to keep abreast of

future developments in this area.

MVD to Implement New Changes to Policy to Assist in the Deactivation of Man-ufactured Home Titles

Anyone who has sold a manufactured

home and has dealt with the New Mex-

ico Motor Vehicle Department (MVD)

on this issue knows how frustrating it

can be. At the request of and in con-

junction with RANM’s Manufactured

Housing Task Force, the MVD has

drafted a new policy to streamline the

process. In early December the MVD

announced it would implement the new

policy by the end of January, 2009. For

details, visit www.nmrealtor.com.

The New Mexico law against releasing the value or sales price of a specific piece of property ap-plies to government employees, not to private citizens. However, a broker may still be prohibit-ed from providing sales price information based on MLS policy, their legal relationship with the client, and/or their contractual obligations.

option, your MLS has subscribed. Th e

specifi c option selected, along with other

factors discussed, will dictate the appro-

priate response if confronted with the

above presented scenario.