The SPD that becomes effective on January 1, 2018 looks significantly different from prior versions of the form. The Commission’s Adjunct Forms Committee (“Forms Committee”) spent a considerable amount of time trying to simplify the form and reorganize sections so that the form is easier for sellers to use and understand.

• The form has been modified to address ongoing issues that the Real Estate Commission has seen with nondisclosure. 
• The advisory to the seller about possible legal liability resulting from a seller’s failure to disclose a known latent material defect has been moved to the first paragraph of the form.  Previously the advisory appeared above the seller’s signature line near the end of the form.   
• The advisory to the seller, which appears near the end of the form, now notifies the seller that the broker will disclose any adverse material facts actually know by the broker to any prospective buyer.  This inclusion is being used to alert the seller to the legal requirements placed upon real estate brokers.  
• Another notable change to the form is the reduction in the responses a seller may select to answer the questions about the different property conditions.  Before there were four columns for the seller to indicate “Yes”, “No”, “Do Not Know” or “N/A” regarding a specific property condition.  The new version of the form simply has a “Yes” column. This change was made so that the seller is strictly responding affirmatively regarding known issues affecting the property.  This means brokers should advise sellers that it is ok to leave items blank if the seller does not know. 

Additional Information on the SPD (2018)

• The SPD also specifies different standards by which a seller is to answer certain questions.  For instance, the Structural Conditions section of the SPD says: “If you know of any of the following problems EVER EXISTING check the “Yes” column.”  While the Electrical & Telecommunications section says: “If you know of any problems NOW EXISTING with the following check the “Yes” column.” Brokers should advise sellers that these different standards exist and to read the form carefully.
• Questions that relate to the condition of the property’s fixtures or inclusions include an additional column for the seller to report the age of the fixture or inclusion, if known.  The Forms Committee also modified the grouping of some of the issues so that similar conditions are contained in the same section. 
• The Contract to Buy and Sell Real Estate requires a seller to complete an SPD on the most current SPD form.  Therefore, brokers who ask the seller to complete the SPD at the time they sign the Seller Listing Contract will need to ask the seller to redo the SPD on the new form prior to entering into a Contract to Buy and Sell Real Estate after January 1, 2018.  Failure to do so could put the seller in default under the contract. 
• Typically when modifications are made to an existing Commission-approved form, we will release red-lined versions to stakeholders that clearly display the changes being made.  Because the tables in this form were modified and sections were organized differently, the Forms Committee did not create a red-lined version of the form.  A red-lined version of the changes would have been extremely confusing and difficult to track.

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