Caveats

Did your mom ever tell you, "Never assume, Dear."  We all know what assuming gets us, right?  This post is a slight deviation from my normal posts, as it is a newspaper article demonstrating the admonition, "Buyer Beware!"  In my life I hope that I will be remembered as one who has integrity and conducts herself with honor in all matters with myself and others.  Hopefully this article will remind you to do your due diligence in every endeavor you pursue and to seek out those individuals, businesses, and institutions that will be trustworthy of guiding you in your process.  After all, as your mom may have also told you (and as some parties in this article demonstrate), "There are wolves in sheep's clothing...."

Meth house auction provides cautionary tale - Tooele home auctioned although seller had been alerted to possible contamination

by Tim Gillie

STAFF WRITER

Foreclosures and short sales have brought home prices down, creating an attractive market for investors hoping to improve a property and flip it later. However, as the case of one Tooele home offered at auction last month illustrates, the admonition “buyer beware” applies doubly these days.

Williams and Williams Worldwide Real Estate Auction, an online real estate auction company based in Tulsa, Oklahoma, went ahead with an auction of a Tooele home last month despite receiving evidence of possible methamphetamine contamination at the property.  Tooele resident Marnie Beacham, along with her brother and father, make a business out of purchasing homes and either flipping them for profit or using them as rentals.  In January, Beacham found a small, bank-owned house listed at williamsauction.com that was located 880 South in Tooele.  Once Beacham decided she was interested in the property, she began doing her due diligence.  “As a routine matter, we have arbitrarily decided to test any property selling for below $100,000 for meth contamination” said Beacham, who also went door-to-door asking neighbors about the property and its former occupants. One neighbor reported suspicious activity including unfamiliar cars coming and going from the home at all hours.

Beachamcollected swab samples from the house and delivered them to ALS Environmental, a Salt Lake City environmental lab that routinely performs meth tests for state-certified decontamination specialists. The test came back positive for meth at 15 micrograms per 100 square centimeters, compared to a threshold of 0.10 micrograms per 100 square centimeters established in state code and county health regulations.

Beacham shared the results with a customer service representative at Williams and Williams and was surprised at the response she got back from their legal department.

Denise Richards, a paralegal with Williams and Williams, sent an email to Beacham explaining that after Richards had contacted the local sheriff and searched a national database, no evidence was found of methamphetamine activity at the address listed for the property.  Richards also said the test Beacham had done could not be relied on because of confusion about the address and the inability to verify the method or areas of the sample collection.

“While we agree that the confirmed presence of methamphetamine would be significant,” wrote Richards. “We do not believe the evidence we have suggests such presence and we cannot postpone the auction based on speculation.”

Beacham remained worried that a young family could move in and their children would be exposed to the contamination.  After the auction was completed, she contacted the high bidder, Jan and Marv Schaffer, of Erda.  “We looked at the test results and it was obvious that the property was very contaminated,” said Marv Schaffer. “I called Williams and Williams and they were very gracious and without any problem they allowed us to withdraw our bid.”

The house currently is not listed for sale either at williamsauction.com or on the Wasatch Front Regional Multiple listing service.

“We have forwarded all the information on the home to the owner,” said Jacob Erhard, Williams and Williams associate general counsel. U.S. Bank, the owner of the home, had the property tested after receiving information about the test done by Beacham.  “It tested positive for meth,” said Amy Frantti, spokesperson for U.S. Bank. “The property will be cleaned up. We will follow the state’s decontamination guidelines.”

There were no visual indicators of meth at the home, law enforcement records had no reports of drug activity there, and the home was not on any health department lists of contaminated property, according to Frantti.

Real estate agents are bound both legally and ethically to disclose information about what’s known in the real estate industry as “stigmatized properties,” including those with meth contamination, according to Chris Sloan, owner/broker of Group 1 Real Estate in Tooele and a former president of the Utah Association of Realtors.  “As an agent for the seller, you have to look out for their best interest, and when you have a reason to believe that a home may be contaminated with meth that should be disclosed,” said Sloan. “Disclosure protects all parties, if a seller is aware of contamination at the time of the sale and does not disclose it to the buyer the seller may be open to liability when the new owner discovers the contamination.”

Sloan cautioned that in the case of a repossessed home being sold by a bank the paperwork often includes a hold harmless statement including wording that the bank, having never lived in the home, can not verify the condition of the home at the time of sale.

Vicki Griffith, broker for Prudential Real Estate Tooele said she has been bitten by selling a state-certified decontaminated meth home and would not accept a listing for a home that she had reason to believe had been contaminated.

The Tooele County Health Department requires the owner of a meth-contaminated property to have the property decontaminated, but establishing contamination in the absence of a police report of meth activity requires obtaining permission from the property owner to access the property to take samples, according to Jeff Coombs, deputy director of the Tooele County Health Department.  “We had problems a few years ago with meth labs in the county,” said Coombs. “So we adopted regulations on meth lab cleanup procedures. Most of the meth labs have left the county and what we are now seeing is homes contaminated with residue from meth use.”

Beacham said she has learned some valuable lessons from this episode.  “I think it is very important for people to be aware of the possibility of meth contamination when buying a home,” said Beacham. “I wouldn't want to buy a contaminated home or put a family into a rental I own that is contaminated.”

tgillie@tooeletranscript.com

 When you decide you are ready to buy your next property, please think of me.  I would love to help guide you through the process.  Visit www.marniebeacham.com for more information.

Thank you for reading!  See you next time.