Failure to Disclose: Frisco Realtor Liability Under TREC §535
Failure-to-disclose claims are the most common TREC complaint category in residential transactions. Frisco-area agents facing these complaints — over property defects, environmental conditions, easement issues, MUD/PID assessments, or transactional facts — need a Position Statement that distinguishes legal disclosure duties from informal expectations.
What Must Be Disclosed
Texas law generally requires disclosure of: known material defects affecting the property, conditions that could affect the buyer's decision, dual agency or representation conflicts, special assessments and HOA dues, easement and encumbrance information, environmental conditions (lead paint, asbestos, mold where known). Disclosure obligations vary by transaction type — residential resale, new construction, commercial, and lease.
Agent vs. Seller Disclosure
Sellers complete the Texas Property Code §5.008 Seller's Disclosure Notice. Listing agents have independent disclosure duties: known material defects, accurate representations to buyers, no false statements about condition, and corrective information if seller's disclosure is known incomplete. Buyer's agents have separate duties to inquire and present known information honestly.
Common Frisco Disclosure Failures
Foundation issues common in North Texas clay soil. Water intrusion in older Frisco subdivisions. HOA pending litigation. Special assessments for MUD/PID infrastructure. Recent or pending repairs. Prior structural work. Knowing the seller's disclosure was incomplete and not correcting it. Listing photos and MLS descriptions inconsistent with property condition.
Mitigation in Disclosure Cases
Defense strategies: documentary evidence of what was actually known to the agent, proof of reliance on professional inspections, evidence of buyer-acknowledged information, and evidence of broker compliance training. Frisco-area agents should retain inspection report copies, signed disclosure forms, and email correspondence showing transparency.
Frequently Asked Questions
Generally not for unknown defects. But agents have duty of inquiry — failure to ask reasonable questions where indicators exist can produce constructive-knowledge liability.
No. As-is contract clauses do not eliminate disclosure of known material defects. They allocate risk for unknown defects, not for knowingly concealed ones.
Disclosure obligations apply to information known at time of representation. Information learned during the option period generally must be disclosed if material.
Texas law specifically provides that some stigmatizations (deaths from natural causes, suicide, HIV) are NOT required to be disclosed. Other stigmas may be material depending on facts.
Yes. Plaintiff in civil suit can also file TREC complaint. Both proceed simultaneously and may produce different outcomes.
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