Glen and Robynn Lerner unwittingly bought a home next to a level one registered sex offender. They sued the couple who sold them the home (“sellers”), and the real estate broker that represented both couples in the transaction. In an opinion filed recently, Lerner v. DMB Realty, LLC, (No.1 CA-CV 11-0339), Division 1 of the Arizona Court of Appeals held that the Lerners’ negligence claim against the sellers for failure to disclose is barred by Arizona Revised Statutes (“A.R.S.”) section 32-2156(A)(3). This statute prohibits a civil action against a seller or real estate broker for failing to disclose that a home is located “in the vicinity of a sex offender.”

On the other hand, the claims for fraud survived and will be remanded to the trial court for further litigation. The Court pointed out that before buying the house, the Lerners allegedly asked a question to which the sellers gave a false answer. When asked why they were moving, the sellers allegedly lied by saying they were moving to be closer to friends when their real reason was the sex offender next door. Whether the Lerners reasonably relied on this information and whether the reason of the sellers’ move was material to the transaction are questions that a jury must resolve on remand to the trial court. Although sellers may not have an affirmative duty to disclose a sex offender in the area, they still must answer inquiries about the home truthfully.

It is also interesting to note that Arizona statutes require law enforcement to notify surrounding neighborhoods of level 2 and level 3 sex offenders living nearby. Arizona’s Department of Public Safety InfoCenter allows you to look up sex offenders by zip code: click here. However, level 1 sex offenders’ addresses are not a matter of public record and local law enforcement agencies need only maintain information about the offender. The sex offender at issue in Lerner v. DMB Realty was level 1. Therefore, the buyers did not have access to that information on a law enforcement website.

Ultimately, home buyers should ask the right questions, and sellers should be very careful to give complete and accurate answers to any inquiries.

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