When a Short-Term Rental is Not a Good Neighbor

Many Berkshire County towns have now passed zoning and general bylaws permitting short-term rentals. Most recently, short-term rentals have been approved in Alford, Becket, Sandisfield, North Adams, and Washington. There are certainly benefits to short-term rentals, both for homeowners and for towns; however, short-term rental use of homes is more in the nature of a hotel use than a residential use. When is a short-term rental not a good neighbor?

Responsible owners make sure that their renters are quiet, do not permit parking on the public way, do not permit pets to be loose outside, manage the trash generated by the rental, and otherwise consider the effect of the rental on neighbors and the town. Towns permitting short-term rentals have attempted to address the possible negative impacts in their bylaws.

Rise in Popularity of Short-Term Rentals in the Berkshires

With the rise in the popularity and, now, the legality of short-term rentals in many towns, the question arises as to the rights of neighbors and others who are impacted by a short-term rental in their neighborhood. The good news is that there are many ways to help balance the rights and responsibilities of short-term rental owners and neighbors.

The best initial step is for neighbors to try to have a constructive conversation with the short-term rental owner. Avoid conflict when possible: it reduces stress and minimizes expense, and is always worth the effort. Unfortunately, this approach is not always effective, and it becomes necessary to take the next step.

Check the By-Laws of Your Town

The first question is whether short-term rentals are even legal in the town. Short-term rentals are not considered under the law to be the same as a residential use of property; rather, it is a commercial use of property. There was and still is a misperception that it is permissible to offer any home as a short-term rental. In most cases, if a town has not adopted a short-term rental bylaw, the use is not permitted in the town. 

The second question is whether the particular short-term rental operated in compliance with the local bylaw and state law. Each town that has adopted a short-term rental bylaw has different and very detailed rules governing that use. The practice has been treated casually in the past, but given the proliferation of such rentals, it is important to be informed about the applicable rules in the particular town.

A neighbor does have the right and ability to force compliance with the local rules through a zoning enforcement complaint with the town if the rules are being disregarded or abused. Zoning enforcement can be a complicated procedure, but it exists to permit persons who are harmed by zoning violations to protect the use and enjoyment of their homes.

Some problems, such as excessive but unregulated noise at all hours, may violate a homeowner’s private property rights. Again, a homeowner can enforce those rights if necessary.

The Best Result? Avoid Conflict

The best result is for conflict to be avoided by open communication. When that is impossible, there are avenues available to homeowners to address the problems.

Alexandra Glover is a founding partner of Lazan Glover & Puciloski, LLP, and is a civil litigator who handles zoning, permitting, and other land use matters at the town level and in the Land Court. www.lazanlaw.com.

This article was first ran in the Berkshire Edge, June 2023.


Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.  Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

Glover SJC Zoning Case: Religious Use Exemption

The Massachusetts Supreme Judicial Court has ruled in favor of Lazan, Glover & Puciloski’s client, Hume Lake Christian Camps. The Court ruled this month that state law exempting religious organizations from local zoning bylaws extended to the camp’s request for 12 recreational vehicle sites. The case is Hume Lake Christian Camps, Inc. v. Planning Board of Monterey, Slip Opinion SJC-13365, p. 27 (June 7, 2023). Click here for SJC ruling.

This ruling has statewide significance because it provides much-needed definition to the scope of the religious exemption from zoning in all towns and cities.  This guidance in a complicated area of law is welcomed by religious organizations and municipalities alike.  The decision also affirms the right, established by the Massachusetts Constitution and the First Amendment to the United States Constitution, for religious institutions to practice their religions in accordance with their own beliefs. Watch the oral argument here.

Alex Glover says, “This ruling has statewide significance because it provides much-needed definition to the scope of the religious exemption from zoning in all towns and cities. This guidance in a complicated area of law is welcomed by religious organizations and municipalities alike.”

The camp, which is located on more than 400 acres, would use the RV sites exclusively for temporary housing for people attending the religious camp programs and for paid staff and volunteers at the camp.  The RV sites would never be opened to the public.

The Court held that the primary or dominant purpose of the camp is to advance Hume’s evangelical mission. Because all of the proposed uses of the RV camp would serve to aid Hume NE in carrying out this mission, the Court concluded that the primary or dominant purpose of the RV camp would be a religiously significant goal. Accordingly, the proposed RV camp would be an exempt use under the so-called Dover Amendment, the portion of the Massachusetts Zoning Act protecting religious uses and structures.

In order to rule in Hume’s favor, the SJC had to make two determinations: (1) whether Hume is a religious sect or denomination protected by the Massachusetts law called the Dover Amendment; and (2) if so, whether Hume uses its land or structures for a religious purpose.  There is surprisingly little law about the scope of the religious exemption from zoning afforded to religious organizations in Massachusetts. The Court answered both questions in the affirmative.

The Court specifically noted that there is a significant danger of inquiring too closely into what is a “necessary” element of a religion, as this inquiry could violate the First Amendment to the United States Constitution. The bottom line is that one cannot look at individual rooms, activities, or components of a religious organization, to determine whether a particular building or use is exempt from zoning.  The question is the use of the structure or land as a whole. Uses that are otherwise secular can be integral to a religious mission.   The Court noted the following examples: a cafeteria, gift shop, maintenance shed, parking lot, radio station, snack bar – or recreational vehicle sites.  These uses can be as protected from zoning as a church edifice, itself.

Here’s the Massachusetts Lawyers Weekly take on the ruling.

Contact us for real estate closings, zoning/permitting, land court litigation, and mediation. Lazan Glover & Puciloski, LLP: lawyers for complex real property issues.

Want more info on Zoning in the Berkshires? Click here.

Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

Photo of Goodnow Preserve rock wall and green foliage in New Marlborough, Massachusetts

Buying Land in the Berkshires? Avoid Pitfalls!

Photo of Goodnow Preserve rock wall and green foliage in New Marlborough, Massachusetts

If you’re buying land in the Berkshires, you almost certainly want to be able to build on that land. It’s important to have the opportunity to sufficiently evaluate the land for your needs before you buy.

You don’t want to ask after the purchase, “How close to the property line can I build?” or “How do I know if my property is big enough to build on?” and find out you can’t build that guest house or put an extension on your current home.

We’ve seen this happen before. Here’s an example:

An individual purchased a property in Great Barrington. The tax map showed that the property was 100 ft wide x 100 ft deep (minimum for a building lot). Unfortunately, the assessor’s office had rounded up; the property was under the minimum size requirements and so was not a building lot at all.  It’s only practical use was as a back yard for a neighboring property. The new owner could not build on the property and came to us for help. We wish they had consulted with a zoning attorney before the purchase!

Here’s what you need to know about buying land in the Berkshires and standard land rider.

At the time you sign the contract to buy the property, your realtor will likely attach a Land Rider to the contract.

Among other things, the Land Rider may contain a condition that the lot be deemed a “building lot” by the local building inspector. Unfortunately, there are many other potential issues that could prevent you from building on the property or that could limit where and how you build on the property. At Lazan, Glover & Puciloski (LGP), we strongly recommend that buyers include a contingency in the contract for review and their subjective approval of the uses of the lot.

Property is deemed a “building lot” if it is the required size and has the required length of frontage along a road.

These rules are set by towns under their zoning bylaws. For instance, a town may require that a building lot be 2 acres in size and has 150 feet of frontage along an approved road.

Even if a property meets those minimal qualifications, it may not in fact be buildable at all.

All or part of the lot may be unbuildable if it is within protected areas, such as areas in the jurisdiction of the Wetlands Protection Act or the local wetlands bylaw of the town. Similarly, clearing of land and construction can be significantly limited if the town has adopted the Scenic Mountains Act. 

Local zoning bylaws regulate how many and what size of accessory structures may be located on the property.

Examples: sheds; detached garages; swimming pools. Zoning can regulate the location, length, and grade of a driveway; the location, height, and materials for fences; and even the number of dogs that can be considered pets as opposed to a commercial kennel. A buyer needs an opportunity to understand what limitations there are on the property.

In addition, the buyer will want to consider what use can be made of the surrounding properties.

There are numerous possible uses of neighboring areas that can impact a property.  For instance, in a Right to Farm community, a commercial farming operation could be located next to the property. The possibility of large solar installations and outdoor cannabis growing facilities may also be considered.  Even local rules concerning the use of short-term rentals (such as VRBO or Air BnB) can effect an abutting property.

We strongly recommend that a contract for the purchase of land include a period in which the prospective buyer can obtain all desired information concerning the property.  Any buyer of land should consider retaining an attorney to perform a zoning review of the property, and should consult with a wetlands expert and possibly an engineer or architect, to confirm that the buyer’s vision for the property is achievable.

Contact Lazan Law if you’re about to embark on a home buying journey in the Berkshires.

Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

Image of out house surrounded by fall foliage in the Berkshires for article about what to know before you buy septic systems in the berkshires

What to Know About Septic Systems in the Berkshires

If you’ve had a sewer line connected to your home, the whole concept of a septic system might be new to you. You might think that it’s just another kind of sewer. However, the problem is that rules about septic systems in the Berkshires are very detailed and, if there are problems, you own them—not the government. Septic problems can be very expensive to fix.

No one wants to think about septic systems but…

Septic systems are very common in the Berkshires. In some communities, it’s the only choice for handling waste. What’s The Problem?

Septic systems in the Berkshires must pass a Title 5 inspection within two years before a sale. Title 5, Massachusetts’ regulation 310 CMR 15.000, governs septic systems and contains rules that specify how to install, use and maintain these systems.

So, what happens?

We’ve seen it happen all too often: a seller waits until they have a buyer under contract before scheduling the inspection, the septic system fails, and the closing can be extended indefinitely until repairs are made or a new system is installed. A once-friendly buyer and seller become mortal enemies because they can’t agree on the appropriate kind of repairs or time frame for completion.

It gets worse. Eager buyers who are getting a mortgage are often dismayed to learn that the bank won’t fund the loan until they have a passing Title 5 report. Interest rates can change. Sellers may discover that their home is no longer going to sell.

Why would somebody wait for Title 5 inspection?

Sellers are often hesitant to do the Title 5 inspection before they believe that they cannot offer a house for sale that has failed an inspection. Or, the seller is afraid that the Board of Health will make them fix the system immediately if it fails. In reality, if a system fails the inspection, you can offer the house for sale and inform the buyer what you are doing to remedy a problem. An owner has two years to make the required upgrades and can work with the local Board of Health or MassDEP to come to an alternative schedule.

Of course, let’s not assume the worst. It may be easier to sell a home if you have passed the Title 5 inspection. It is one less thing to worry about and to wait for.

What does the Title 5 inspection involve?

The purpose of the Title 5 inspection is to protect groundwater supplies and determine if septic systems in their current conditions can protect public health and the environment. The inspection includes determining the location and condition of cesspools, septic tanks and distribution boxes. It does not guarantee that a septic system will function adequately or that it won’t fail later. The system must be inspected by a MassDEP-approved individual using the MassDEP-approved inspection form. The inspection report must be submitted to the Board of Health within 30 days of the inspection. The buyer of the property with a septic system must also receive a copy of the inspection report.

Inspections generally are good for 2 years. If a property is sold more than once in the 2-year period, the single inspection is valid for all property transfers. If a system is pumped annually and the pumping records are available, an inspection is valid for 3 years. If weather conditions prevent inspection at the time of a sale, the inspection must take place within 6 months afterward, but the seller must provide written notice to the buyer of the need to complete the inspection.  

Conditional pass or failed Title 5 inspection

A septic system in the Berkshires may receive a “conditional pass” if there are certain components that need repair, such as a cracked septic tank, broken pipes, uneven distribution box, or malfunctioning pump chamber. In these cases, the seller must make the appropriate repairs, at which time the Board of Health will issue a Certificate of Compliance.

If a septic system completely fails the inspection, it is the owner’s responsibility to replace or repair the system within two years. If a system fails shortly after a sale, the buyer may have legal recourse, but it may be very hard to prove that the system was in failure at the time of the inspection.

What about mounded septic systems?

A common point of concern among both buyers and sellers is that if a septic system fails Title 5, the owner will be forced to install a “mounded” system, resulting in an unsightly mound or bulge on the property. The Title 5 regulations changed in 1995 to require that the bottom of a septic system must rest four feet above the high-water table which, in Berkshire County, ranges between 12 and 30 inches below ground. As a result, almost all standard septic systems installed after 1995 in Berkshire County are mounded. That is, the bottom of the septic system rests near the top of the ground so sand or soil can absorb the waste before reaching the water table, and the top of the septic system protrudes slightly above ground level.

There are ways to get around an unsightly mound, including grading the area around the septic system so the mound doesn’t appear elevated. Most towns will grant an automatic variance allowing the system to be installed 3 feet, instead of 4 feet, above the water table.

If an owner is willing to spend a bit more money on a tertiary treatment or filtration system, they could be eligible for a 2-foot variance. Massachusetts recently approved a new alternative system called an Elgin System, which is more affordable than any of the other approved alternative systems. Unlike the other systems, it does not require an annual maintenance agreement and only requires 2 feet of separation to groundwater.

Hope this wasn’t a waste of your time…

More Resources

Read more about buying or selling property with a septic system: https://www.mass.gov/guides/buying-or-selling-property-with-a-septic-system

Read the full 310 CMR 15.00: Septic Systems (“Title 5”) here: https://www.mass.gov/regulations/310-CMR-15000-septic-systems-title-5

Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

What Are Common Closing Costs in Massachusetts?

“What are common closing costs in Massachusetts?” This is perhaps the most common question we get from prospective buyers and sellers. Every transaction is different, so the question is not always easy to answer. However, there are some standard fees that one should expect. Read our list!

Image of a couple arm in arm looking at the Stockbridge Bowl and the Berkshire mountains. Text says What are common closing costs in Massachusetts?

Massachusetts Buyer Closing Costs

  • Recording Fees —Various documents are recorded at the Registry of Deeds at closing. The Commonwealth currently charges (as of September 2022) the following amounts for the following documents:
    • Deed – $155Mortgage – $205Municipal Lien Certificate – $80Declaration of Homestead – $35
    • Certificates and Affidavits – $105
  • Plot Plan — If you are buying a house, as opposed to unimproved land, your lawyer will almost always order a plot plan from a local surveyor to ensure that there are no encroachments on the property. This typically costs between $350 and $500.
  • Title Exam / Abstracting — Your lawyer will order the complete record of recorded documents pertaining to the property from the past 50 years from an abstractor. This typically costs between $300 and $400.
  • Municipal Lien Certificate — This is the tax certificate that shows the exact amount of the property taxes and whether any taxes are owed. Towns and cities typically charge between $25 and $50 per certificate.
  • Adjustments for Property Taxes — Property taxes are pro-rated, so you will pay the seller for any property taxes that have already been paid for the current tax period.
  • Adjustments for Propane/Fuel/Heating Oil — Buyers must pay sellers for any propane or oil that is left in the tank(s). This is calculated based on the current price per gallon and a reading of the gauge a few days before closing.
  • Title Insurance Policy — Title insurance protects owners and their lenders from financial loss resulting from a hidden defect in the title to a property. It is a one-time payment that covers homeowners for as long as they own the property. The payment is a factor of the purchase price of the property. Commonly, it’s calculated as $4.00 per every $1,000, but this can change for properties over $1 million and depends whether a lender’s policy is being issued simultaneously. You should ask your attorney to calculate this for you.
  • Legal Fee — This can vary depending on the purchase price of the property, whether the buyer is getting a mortgage, and whether any special considerations are involved.
  • Bank Fees — If you are getting a mortgage, the lender will charge various additional closing costs. These can vary greatly between lenders. Typical bank fees include underwriting fees, appraisal fees, credit checks, and rate lock fees. Your lender will provide you with a loan estimate when you apply for your mortgage.
  • Homeowner’s Insurance — The premium for the first year is usually paid at closing and can be included in your closing costs. If you are getting a mortgage, your bank will require this to ensure that the home will be insured as of the closing date.
  • Buyers do NOT pay realtors’ commission.

Massachusetts Seller Closing Costs

  • Commission to Realtors — If you are using a realtor, you will have an agreement with the realtor stating the rate of their commission. This is almost always a percentage of the sale price. A listing agent typically splits the commission with the buyer’s agent.
  • Recording Fees — Sellers do not pay to record the deed, but occasionally a seller must record a document at closing, such as a trustee certificate, easement, agreement or affidavit.
  • Transfer Tax (“tax stamp”) — Sellers in Massachusetts are required to pay a “tax stamp” when they sell property. The tax is currently set as $4.56 per every $1,000 of the sale price.
  • Unpaid property taxes, HOA dues, water/sewer bills.  

Want more information on buying and selling homes in Massachusetts? We think you’ll find our our downloadable guides of interest. Click on the images below for The Purchase and Sale Agreement and Realtors, Attorneys, and the Contract.

Buying and Selling a Home in the Berkshires The Purchase And Sales Agreement

About Lazan Glover Puciloski, LLP

Lazan Law has overseen thousands of closings over our 35 year history. And we’ve never been busier! We most frequently work with home buyers and sellers in the Berkshires: Alford, Great Barrington, Hancock, Lee, Lenox, Monterey, North Adams, Pittsfield, Richmond, Sandisfield, Sheffield, Southfield, Stockbridge, South Egremont, Tyringham, West Stockbridge, and Williamstown, as well as communities beyond the Berkshires.

Contact us if you’re about to embark on a home buying journey!

Disclaimer: The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

Thoughtful man in blue shirt with blue coffee cup wondering if he needs title insurance

What is Title Insurance in Massachusetts?

One of the most common questions we get from buyers is, “what is title insurance and why do I need it?” Although most homeowners in Massachusetts have title insurance, it remains a mystery to many people. Read on for clarity…and a real life scenario—one property owner had title insurance, one did not.

Thoughtful man in blue shirt with blue coffee cup wondering if he needs title insurance

Quick Overview

Title insurance protects owners and their lenders from financial loss resulting from a hidden defect in the title to a property. It involves a one-time payment (usually at the closing, but a policy can be purchased any time) and it covers homeowners for as long as they own the home.  A title insurance policy is not a guarantee that the title to the particular property is good.  Rather, it is an agreement by a title insurance company to defend the insured if there is a claim of a title defect covered by the title policy and/or to indemnify the insured for actual loss or damage sustained because of a covered title defect. 

An owner’s policy protects you for the purchase price of your home plus legal costs if a title or ownership issue arises. Lenders require buyers to purchase a title insurance policy that protects the lender. Typically, a title insurance company will issue an owner’s and lender’s policy simultaneously for a discounted rate.

R

A Surveyor Made a Math Error…

Years ago, a property owner divided his land into multiple housing lots. The property owner hired a surveyor to prepare a plan that would create the new housing lots and the roads accessing those lots. Unfortunately, the surveyor made a math error when calculating the size of the development and the lots in it. As a result, three of the lots and a portion of the roadway were located on land owned by an abutter. By the time the error was discovered, two separate families had purchased those three separate building lots—but the developer had no right to sell those lots because he never owned the land. In short, neither of the two new “owners” had any rights to the lots they believed they had purchased.

As you can imagine, much angst ensued.

The fate of the two couples became tied to title insurance. One of the couples purchased title insurance when they supposedly purchased their building lot. Their attorney was able to show that the original plan was wrong and that the title defect was covered by title insurance. This couple received all of their purchase money back from the title insurer.

The second couple had purchased their property in cash and had not purchased title insurance. This couple was unable to recover their money from the developer or the surveyor, and thus they were out the money they had saved to build their retirement home. So…

Do I need title insurance?

Yes. In our experience, the time, money, and aggravation saved by purchasing a title insurance policy is worth vastly more than the one-time premium payment.  A title insurance policy covering the lender does not protect your interest in the property; it only protects the money owed to the lender.  In order to protect yourself, you need to purchase an owner’s title policy.

What does title insurance cover?

Unlike traditional insurance, which protects against future events, title insurance protects against claims for past occurrences, such as forged or improperly recorded deeds and mortgage discharges. When you become the owner to a property, you also become the owner (so to speak) of any title problems.  A lawyer’s title exam will look back at the previous 50 years and should uncover any outstanding liens, for instance, but even the best title examiner may not be able to identify certain defects that are not evident from the records in the Registry of Deeds.

Examples of common title defects:

  • Claims of ownership by another party;
  • Undisclosed or missing heirs;
  • Lack of a right of access to and from your land;
  • Unresolved homesteads;
  • Unresolved probate claims;
  • Lost or incorrectly recorded documents (e.g., deeds, mortgages, mortgage discharges);
  • Fraud. This can take many forms, including falsified mortgage discharges;
  • Mechanic’s liens. Unpaid contractors, homeowner association dues or property taxes can result in liens on the property;
  • Restrictive covenants
  • Easements not referenced in the 50-year title search period;
  • Encumbrances or judgments against property;
  • Unmarketability of title.

My title exam came back clear… does that mean I don’t need title insurance?

In Massachusetts, lawyers are required to examine title going back fifty years unless there is something in the last 50 years that suggests an earlier title question. Even the most skilled title examiners may not find all problems associated with a property. Some risks, such as title issues due to recording errors, forgeries, or undisclosed heirs, are impossible to identify.  If there are problems with a title that occurred prior to the lawyer’s search, those problems still exist and can, on occasion, cause problems in the future.  Title insurance will protect you from title defects occurring before the 50-year lookback period.

Am I Required to Have Title Insurance?

If you borrow money from a bank to purchase your property, you will be required to purchase a title insurance policy for the bank, but it is your choice whether you purchase a policy for yourself.  There is no law requiring you to purchase any title insurance on your home and land, but we would be remiss if we didn’t encourage you to protect your investment by purchasing a title insurance policy. When you purchase a home and receive the deed to the property, you become the official owner of the property.  In addition to purchasing what you can see, you may unknowingly be purchasing hidden claims on the property that are attached to the title of the property.  The cost of the insurance is a fraction of a homeowner’s investment in the property.

Why Doesn’t My Homeowners Insurance Policy Cover Me in Case of a Claim?

Home insurance policies and umbrella policies cover you in the event of physical damage to your property or for claims filed for damages to others after the policy is in place.  These other policies do not cover claims against the title of your home or other claims that are from before you received title to the property. Lazan Law has overseen thousands of closings over our 35 year history. And we’ve never been busier! We most frequently work with home buyers and sellers in the Berkshires: Alford, Great Barrington, Hancock, Lee, Lenox, Monterey, North Adams, Pittsfield, Richmond, Sandisfield, Sheffield, Southfield, Stockbridge, South Egremont, Tyringham, West Stockbridge, and Williamstown, as well as communities beyond the Berkshires.

Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidentil relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

Fresh eggs sign in the Berkshires of Massachusetts waht are a realtor's responsibilities when talking about zoning?

What Are a Realtor’s Responsibilities When Talking About Zoning?

What ARE a realtor’s responsibilities when talking about zoning with a client here in the Berkshires? It makes sense for a successful realtor to describe all aspects of a featured property. Prospective buyers are likely interested in the interior design, the layout, the exterior appearance, landscaping, outbuildings, and numerous other aspects of the property. One question that arises time and again is whether the property can be used in the manner desired by the prospective buyer. Many listings feature the zoning that applies to the property and describe various uses of the property that are possible. Unfortunately, without the proper, specific disclaimer language, a realtor can be held liable for statements made about the zoning of a particular property.

Why does zoning matter?

As a brief summary, cities and towns in Massachusetts may regulate the use of land, as well as the buildings and structures. Each town in Berkshire County has adopted a zoning bylaw containing these rules concerning the use of land in that town. Each town’s zoning bylaw is unique, and thus each town’s rules concerning what use can be made of land in that town are also unique. If that is not complicated enough, most towns have multiple zoning districts. This means that some parts of the town may be used only for residential purposes, while some areas may be used for other purposes, such as commercial, industrial, and so on. Obviously, it is important to know how a particular property may be used and what buildings or structures may be placed on the property. This is true both about possible future uses and buildings, as well as existing uses of, and buildings on, the property. There are many pitfalls associated with zoning. For instance, one cannot assume that a building or use is legal simply because it has been on the property for a long period of time.

A conscientious realtor can be put in a difficult position: the realtor wants to provide all available information to a prospective buyer, but does not want to make statements about zoning that could later prove problematic. The worst-case scenario, of course, is that the realtor tells a buyer that the property can be used in a certain manner (such as a building lot), and that the buyer purchases the property and then later is shocked to learn that the property is unbuildable.

What can a realtor say about zoning and how can she/he be protected?

A realtor can always give their best sense of the permitted uses when referencing zoning: they should clearly state that the buyer should not rely on their representations as to zoning or use of the property. It is probably not enough to have a general disclaimer in boilerplate language at the end of the listing.

Unfortunately, this issue has gone to court several times. The Massachusetts Supreme Judicial Court has held that a realtor may be liable for misrepresentations about zoning if the realtor: (1) in the course of their business, or in a transaction in which they had a *800 pecuniary interest, (2) supplied false information for the guidance of others (3) in their business transactions, (4) causing and resulting in pecuniary loss to those others (5) by their justifiable reliance on the information, and that the realtor (6) failed to exercise reasonable care or competence in obtaining or communicating the information.  DeWolfe v. Hingham Ctr., Ltd., 464 Mass. 795, 799–800 (2013). In short, the broker has a duty to exercise reasonable care in making representations to prospective buyers. A realtor has a duty in Massachusetts to investigate before making representations as to the zoning classification of a property.

The best practice? If a realtor is going to mention zoning, the realtor should explicitly state that the buyer should not rely on the realtor’s representation about zoning and should investigate the applicable zoning themselves.

Follow us on Facebook, Instagram, and LinkedIn to know when we post blog posts that may be of value to you.

Want more info on Zoning in the Berkshires? Click here.

Also, we recommend you download our guides for buyers and sellers.

Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

Beautiful winter pine trees with red barn with words what is a nominee realty trust in Massachusetts

What is a Nominee Trust in Massachusetts?

It is common for home buyers in Massachusetts to take title to property with a nominee realty trust (sometimes simply called a “realty trust” or “nominee trust”). What is a nominee realty trust? A nominee trust is an entity unique to Massachusetts, and despite its name, it’s not a true trust. It does, however, provide several benefits for property owners concerned about:

  • Privacy
  • Estate planning
  • Simplifying subsequent transfers.  
What is a nominee trust?

As opposed to a true trust, a nominee trust is really just a principal and agency relationship between the beneficiaries and the trustees. As explained by the Supreme Judicial Court of Massachusetts, a nominee trust is “an entity created for the purpose of holding legal title to property with the trustees having only perfunctory duties”. Morrison v. Lennett, 415 Mass. 857, 860 (1993).

A true trust, on the other hand, is defined as “a fiduciary relationship with respect to property, subjecting the person by whom the title to the property is held to equitable duties to deal with the property for the benefit of another person.” Restatement (Second) of Trusts § 2 (1959). The trustee of a true trust has a duty to the beneficiary to administer the trust and can exercise such powers as are necessary or appropriate to carry out the purposes of the trust and that are not forbidden by the terms of the trust. Id. at §§ 169, 186.

The common characteristics of a nominee trust are as follows:

(1) the names of the beneficiaries are filed with the trustees rather than being publicly disclosed;

(2) a trustee may serve simultaneously as a beneficiary;

(3) the trustees lack power to deal with the trust property except as directed by the beneficiaries;

(4) a third party may rely on the disposition of trust property pursuant to any instrument signed by the trustees, without having to inquire as to whether the terms of the trust have been complied with; and

(5) the beneficiaries may terminate the trust at any time, thereby receiving legal title to the trust property as tenants in common in proportion to their beneficial interests.”

Roberts v. Roberts, 419 Mass. 685, 687 n.2 (1995), quoting In Re Grand Jury Subpoena, 973 F.2d 45, 48 (1st Cir. 1992). 

Most significantly, a nominee trust provides that the trustees are to act only at the discretion of the beneficiaries. It is the beneficiaries – not the trustees – who truly own the property. While the deed to the property will contain the name of the trust and trustees, the beneficiaries are not listed on the deed or even the trust instrument. Rather, beneficiaries are normally listed in a “Schedule of Beneficiaries,” which is not recorded and can be kept confidential. Although the same person can be a trustee and a beneficiary, one cannot be the sole trustee and the sole beneficiary at any point in time.

What are the benefits of a nominee trust?
  • Privacy – The Schedule of Beneficiaries is not recorded and, as such, the true owners of the property need not be publicly disclosed.
  • Simplicity – A nominee trust can be used to simplify title where multiple people and/or entities own the property. It can also simplify the process of transferring ownership to the property.  That is, instead of recording an entirely new deed, one can transfer ownership by simply amending the Schedule of Beneficiaries (with the written consent of the current beneficiaries, of course).
  • Avoid probate – Like a true trust, a nominee trust can be used to avoid passing title through a probate estate.  

A common option for people with revocable or irrevocable trusts (a/k/a “true” trusts) is to take title to property as trustee of a nominee trust, and to name the trustee(s) of the “true” trust as the beneficiary of the nominee trust.

A recent decision issued by the Supreme Judicial Court of Massachusetts (SJC) brings to light another benefit of nominee trusts: Mass. Health cannot reach the beneficial interest of the decedent in a nominee trust.  Guilfoil v. Sec’y of Exec. Office of Health & Human Servs., No. SJC-12922 (Mass. Feb. 9, 2021).  In Guilfoil, the decedent retained a life estate in her property as a beneficiary of a nominee trust, while her five children had a remainder interest. The SJC concluded that because the trust was a nominee trust, not a true trust, the plaintiff had no ability to reclaim ownership of the property’s remainder interest and that her life estate was not a countable asset for Medicaid eligibility purposes.

Why not just take title with an LLC?

Taking title with an LLC may be an attractive option for people concerned with anonymity and multi-member companies seeking to avoid liability. However, in Massachusetts, an LLC does not protect single-member LLCs or managers of LLCs from liability for negligence or misrepresentation. So, despite popular thought, taking title with an LLC does not afford as much protection as one might hope.  While an LLC does offer some limited liability and can be used to maintain privacy of ownership, this latter benefit can also be attained with a nominee trust at less cost. It costs $500 to register an LLC in Massachusetts, and $500 every year thereafter to renew, but only $155 to record a new deed and $105 to record a trustee’s certificate, with no annual renewal fees. It is critical that you consult with an attorney to determine the best option for you.

Interested in another blog post? Read Can Text Messages Form a Binding Contract. Also, please follow us on Facebook, Instagram or LinkedIn.

Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.

Adult using a smart phone to text about a real estate contract

Can Text Messages Form a Binding Real Estate Contract?

Adult using a smart phone to text about a real estate contract

In Massachusetts, real estate contracts or agreements must be in writing. Traditionally, this means that a real estate sale agreement must be set out in a purchase and sale agreement, signed by all parties. However, the world has gone digital; this drastically changes this rule. Can text messages form a binding real estate contract? Read on.

The changes began with email

Courts were called upon to consider whether an exchange of emails between a buyer and a seller could create a binding contract. Over time, courts have concluded that email messages exchanged between a prospective buyer and seller can, in fact, constitute a binding contract as long as the emails, taken together, show agreement on specific key points, such as the closing date, the purchase price, the deposit amount, and treatment of contingencies. Parties who may have thought they were simply exploring the possibility of a purchase or sale by email found themselves in a binding contract.

Smart phones continued the issue

The logical next question was whether parties could be bound to a real estate deal as a result of an exchange of text messages. The Land Court has answered that question in the affirmative. Of course, the context of the text messages is important and, as with emails, the essential terms of the deal must be agreed upon. However, a court will consider a string of texts together in considering whether there is a binding agreement between the parties. Thus, all of the essential terms of the deal need not be contained within a single text.

So, can text messages form a binding real estate contract?

The danger here is clear. Through a simple, informal exchange of text messages, a  property owner could inadvertently agree to bind themselves to sell their property or a prospective buyer could inadvertently agree to buy property. The moral of the story is that it is far better to seek legal assistance before you engage in any negotiation concerning real property, even an informal exchange of text messages. So can text messages form a binding real estate contract? Yes. Yes they can.

If you’d like to learn more about Berkshire realtors, attorneys, and the real estate contract, click here.

Want to know when new blog posts go live? Follow us on Facebook, Instagram or Linkedin.

Disclaimer:  The information contained herein is for informational purposes only. It does not constitute the rendering of legal or other professional advice or services. Your review of this post and/or use of the Lazan Glover & Puciloski, LLP website does not create an attorney-client or confidential relationship between you and Lazan Glover & Puciloski, LLP or any of its attorneys. Information provided herein or on the website should not be relied upon or used as a substitute for consultation with legal, accounting, tax, and/or other professional advisors.   Since any electronic communication between you and Lazan Glover & Puciloski, LLP through this website will not be privileged or confidential, it may be disclosed to other persons and may not be secure. Accordingly, please do not send any e-mail to the Firm that contains confidential or sensitive information without first speaking with an attorney at Lazan Glover & Puciloski, LLP and receiving permission to do so.