From Kelly Monaghan, Esq., Holloway and Monaghan
SQUARE FOOTAGE LAW revisited:
If the licensee provides any party to the transaction square footage information, the licensee is required to identify the source of the information.
The source, referred to as “third party information,” includes an appraisal or measurement prepared by a licensed appraiser, a survey or developer’s plan prepared by a licensed surveyor, tax assessor public records, or building plans used to construct or market the property.
The law states the licensee has no duty to the seller or purchaser to conduct an independent investigation of the size or area of the property or to
Independently verify the accuracy of the third party information.
The law does not require any square footage information to be provided. However, IF provided, the licensee should provide information from all sources available to them, especially if the reported square
footage is not the same. Additionally, because the law does not limit the third party information previously obtained in connection with the pending real estate transaction, uncertainty exists whether third party information previously obtained by the licensee in a prior real estate transaction involving the same property must also be discussed.
If third party information is provided, the failure to disclose all third party information in the possession of, or otherwise available to, the licensee may be problematic. The adoption of, and compliance with, a written record retention policy will limit the third party information retained in the licensee’s files, including electronic copies. This in turn will assist in determining what third party information, if any, is to be provided to the parties. Prior to discarding any third party information,a written record retention policy that complies with applicable rules, regulations and laws should be adopted.