Under California statutory law, each agent in a real estate transaction is required to give a statutory form of Agency Disclosure Statement. This statement describes the agency relationships between the agents and the parties.
California Civil Code Section 2079 imposes special duties upon brokers involved in the sale of residential real property. All such brokers are required personally to visually inspect such properties and to disclose to prospective buyers any defects which such an inspection should have disclosed. This duty does not apply to commercial properties, and it does not apply to properties with more than four units of residential property.
The duty is to personally conduct a reasonably competent and diligent visual inspection of the property. They duty does not extend to inspecting title or the public records of permits. They duty applies to both the buyer’s broker and the seller’s broker; the information must be disclosed to the prospective buyer.
Please note that this statutory duty is in addition to the other broker duties, discussed separately. As a practical matter, Civil Code Section 2079 does not add much to the duties of the buyer’s broker, who already has a fiduciary duty of investigation to his or her own client. The primary change made by Civil Code Section 2079 is to require the seller’s agent to personally inspect the house and to disclose what he or she finds to the buyer.