On October 6, 2022, the New Jersey Senate Environment and Energy Committee advanced legislation sponsored by Senator Bob Smith and Senator Richard Codey that would require home sellers and landlords to notify prospective buyers and renters if a property is at risk of being affected by flooding. The bill (S-3110) would require the Department of Community Affairs (“DCA”) to create a form used by sellers and landlords to notify prospective buyers or renters of flooding risks to the property before they become obligated under any contract. The form would indicate if any of the property is located in a Federal Emergency Management Agency designated floodplain, a Special Flood Hazard Area or a Risk Flood Hazard Area and if the property has ever experienced any flood damage in the past. This bill appears to be a response to the devastating damage caused by Hurricane Ian, and since New Jersey is vulnerable to sea level rise, flooding events and saltwater intrusion.
All notification pursuant to this Bill would be required to be provided to a purchaser or tenant in writing before the purchaser or tenant becomes obligated under any contract for the purchase or lease of the property. The Bill requires the DCA to create a form containing questions and space for the landlord to answer concerning certain flooding risks to the property. For example, one question requires the seller or landlord to disclose “[h]as the property experienced any flood damage, water seepage, or pooled water due to a natural flood event, such as heavy rainfall, coastal storm surge, tidal inundation or river overflow”. If the answer is yes, the seller or landlord must disclose how many times such damage occurred. Seasonal renting of less than 120 days will be exempt from this required notification.
The Bill provides that if a landlord violates this notification requirement and a tenant suffers “substantial loss or damage to the tenant’s personal property” as a result of flooding, the tenant will have the right to terminate the lease and may pursue legal remedies against the landlord to recover damages due the landlord’s failure to “disclose critical information.” The term “substantial loss of or damage to personal property” is defined to mean “if the total cost of repairs to or replacement of the personal property is 50 percent or more of the personal property’s market value on the date the flooding occurred.” It is worth noting the Bill does not expressly provide a remedy against a realtor if the realtor (acting as the agent for landlord or seller) fails to comply with the proposed required notification.
Termination of the lease is defined to become effective after the tenant delivers written notice of termination no later than 30 days after the date the loss or damage occurs, and is effective when the tenant surrenders possession of the dwelling. The Landlord is required to refund the tenant all rents and other amounts paid in advance under the lease after the effective date of termination, but no later than 30 days after the effective date of termination.
The Bill was released from the committee by a vote of 5-0.
For more information about this new legislation, please contact Alan P. Fox, Esq.
