The Seller Who Never Lived There Still Has to Fill In the Form

Corporate relocation works by taking the house off the employee's hands. An employer or a relocation management company buys the home at an appraised or guaranteed value, the family moves, and the house sits empty until it resells. At the point of resale the company is a seller of a single-family residence that nobody from the company has ever lived in, slept in, or run a shower in - and in the states with a statutory disclosure form, it has to fill one in anyway. The same problem belongs to any corporate owner selling a house it bought and never occupied.

The Exemptions Do Not Cover a Buyer Who Never Moved In

Both statutes exempt a list of transferors, and the list is instructive precisely because of who is on it. Texas Property Code § 5.008(e) excludes transfers pursuant to a court order or foreclosure sale; by a trustee in bankruptcy; to a mortgagee by a mortgagor; by a mortgagee or deed-of-trust beneficiary that acquired at a power-of-sale or court-ordered foreclosure sale or by deed in lieu; "by a fiduciary in the course of the administration of a decedent's estate, guardianship, conservatorship, or trust"; between co-owners; to a spouse or a person in the lineal line of consanguinity; between spouses under a divorce decree or property settlement; "to or from any governmental entity"; of a new residence "which has not previously been occupied for residential purposes"; and where the value of any dwelling does not exceed five percent of the value of the property.

Ohio R.C. 5302.30(B)(2) runs to fourteen paragraphs and covers the same ground, adding two of its own: (m) exempts a transfer "to a transferee who has occupied the property as a personal residence for one or more years immediately prior to the transfer," and (n) exempts a transfer "from a transferor who both has not occupied the property as a personal residence within one year immediately prior to the transfer and has acquired the property through inheritance or devise."

Paragraph (n) is the one a relocation company might reach for and cannot. It is conjunctive. Not having lived there is half of it; the other half is having acquired the property by inheritance or devise. A company that wrote a cheque for the house meets the first condition and fails the second, and so is squarely inside the disclosure requirement.

There is a real exemption in this neighbourhood, and it belongs to someone else. Fiduciaries administering a decedent's estate, a guardianship, a conservatorship or a trust are exempt in both states - Texas at § 5.008(e)(5), Ohio at R.C. 5302.30(B)(2)(g). An executor selling the family home does not complete the form; a relocation company selling an identically empty house next door does. The fiduciary side of that line is covered across our estates, probate and fiduciary guides.

Ignorance Is Compliant, and Expensive

Neither statute requires the seller to go and find out. Both measure the duty against what the seller actually knows.

Texas § 5.008(d): "The notice shall be completed to the best of seller's belief and knowledge as of the date the notice is completed and signed by the seller. If the information required by the notice is unknown to the seller, the seller shall indicate that fact on the notice, and by that act is in compliance with this section." The form carries "Unknown (U)" as a printed option throughout, and begins by asking the question directly: "Seller __ is __ is not occupying the Property. If unoccupied, how long since Seller has occupied the Property?"

Ohio ties it to actual knowledge as well. The form prescribed under R.C. 5302.30(D)(1) is designed to disclose "any material defects in the property that are within the actual knowledge of the transferor," and division (F)(1) protects a transferor from damages "for injury, death, or loss to person or property that allegedly arises from any error in, inaccuracy of, or omission of any item of information required to be disclosed in the property disclosure form if the error, inaccuracy, or omission was not within the transferor's actual knowledge."

There are two limits on using that. The first is good faith: division (E)(1) requires each disclosure and each act performed in making it to be "made or performed in good faith," and division (A)(1) defines good faith as "honesty in fact in a transaction involving the transfer of residential real property." The second is the evasion proviso in (E)(2) - a good faith approximation of an unknown item is allowed "if the approximation is not used for the purpose of circumventing or otherwise evading" divisions (C) and (D).

And division (J) preserves everything outside the section: the specified items "do not limit or abridge" any obligation to disclose arising from other provisions of the Revised Code, the common law, "or that may exist in order to preclude fraud, either by misrepresentation, concealment, or nondisclosure." A form full of "unknown" satisfies the section; it does not resolve what else the law may require.

The Ohio Form Says the Quiet Part Itself

R.C. 5302.30(D)(1) does not only prescribe the questions. It prescribes a set of statements the form must set out, "substantially similar" to a list in the statute. One of them is this: that "unless the transferee is otherwise advised in writing, the transferor, other than having lived at or owning the property, possesses no greater knowledge than that which could be obtained by a careful inspection of the property by a potential transferee."

For an ordinary homeowner that sentence is a disclaimer. For a company that has never lived at the property, it is a literal description of its position - with the clause that would otherwise help it, "having lived at," inapplicable. Its knowledge is whatever a careful inspection would have produced. If nobody inspected, there is no knowledge to disclose, and the form says so to the buyer in the statute's own words.

Timing Is the Whole Risk

The reason this is an operational question and not a paperwork question is what both statutes do about late information.

The Ohio mechanism deserves a second look because it is counter-intuitive. Division (G) lets the transferor amend any disclosed item "at any time following the delivery of the form." Division (K)(2) attaches the rescission right to a transferee who receives "a property disclosure form or an amendment of that form as described in division (G)" after entering a transfer agreement. So correcting the form is itself a triggering event: the buyer gets three business days from receipt of the amendment, subject to the thirty-day and closing caps.

That is the practical argument for finding out about a house before it is listed rather than after it is under contract. A defect discovered in week one goes onto the original form, and under division (K)(3)(d) there is no rescission right at all where the buyer received the form before making the offer. The same defect discovered in week six becomes an amendment, and an amendment is an exit.

Two further details close the loop. Division (K)(2) says a rescinding buyer incurs no liability "including, but not limited to, a civil action for specific performance of the transfer agreement," and the transferor "shall return, any deposits made by the transferee." Division (K)(3)(c) allows a buyer to waive the right of rescission - which is to say the right is worth something, or nobody would be asked to give it up.

What an Empty House Does While It Waits

The disclosure problem and the condition problem are the same problem seen from two ends. A relocation inventory home is vacant, usually through at least one season, often through a winter in the northern part of the footprint. The defects that appear in that period - a slow supply line, a failed sump, stagnant water in the fixtures, a roof leak nobody heard - are exactly the items the forms ask about, and they arise during the company's ownership rather than the employee's.

They also arise after the employee has moved out and stopped noticing things. Whatever the company knows about the house on the day it signs the form is what somebody wrote down during that vacancy. Our vacant property maintenance checklist covers the work itself, inspection documentation covers the record, and mould prevention in vacant properties covers the defect most likely to be invisible until a buyer's inspector finds it.

What This Means If You Sell Houses You Never Lived In

• Assume the form applies - neither Tex. Prop. Code § 5.008(e) nor Ohio R.C. 5302.30(B)(2) exempts a corporate or relocation purchaser
• Do not rely on Ohio's (B)(2)(n) non-occupancy exemption unless the property was also acquired by inheritance or devise; both limbs are required
• Deliver the form before the offer, not after - under Ohio (K)(3)(d) a buyer who had it first has no rescission right
• In Texas, deliver on or before the effective date of the binding contract, which is what § 5.008(f) measures the seven days against
• Treat an amendment as a decision, not a formality: in Ohio it restarts three business days under (K)(2)
• Inspect during the vacancy, because "unknown" is compliant but the Ohio form tells the buyer your knowledge equals a careful inspection
• Keep the inspection record dated, since the form is completed "as of the date" it is signed in Texas and to actual knowledge in Ohio
• Do not use an approximation to paper over something you could have known - Ohio (E)(2) excludes approximations used to evade
• Remember Ohio (J): the section does not displace other disclosure obligations or the law on concealment and nondisclosure
• Check the exemption list before assuming a given disposition is covered - foreclosure, fiduciary, governmental and never-inhabited new construction transfers sit outside both statutes

Our own capability is on inspections, repairs and vacant property checks, and there is a sample report showing the format a disclosure form can actually be completed from.