2015 Tennessee Legislature Expands Real Estate Sale Disclosure Requirements to Include Sink Holes

Posted on Sep 27 2015 2:01PM by Attorney, Jason A. Lee

Tennessee has long required certain disclosures when a residential property is sold.  Some of these disclosures are found in T.C.A. § 66-5-201 et. al. The 2015 Tennessee legislature has now added the additional requirement that all sellers of residential real property disclose the presence of any known sink hole on the property.  See Public Chapter 262.  This must be done in writing and prior to entering into a contract with the purchaser of the property.  Under the statute, the term “sink hole” is defined as follows: 


(2) For purposes of this section, “sinkhole”:

(A) Means a subterranean void created by the dissolution of limestone or dolostone strata resulting from groundwater erosion, causing a surface subsidence of soil, sediment, or rock; and

(B) Is indicated through the contour lines on the property's recorded plat map.


This new statute went into effect on July 1, 2015 and takes effect for all contracts entered into on or after that date.  This new statute is found in TCA § 66-5-212.  As a result, it is important for sellers of real property to inform purchasers of sink holes on their property.  If the seller of real property does not make this disclosure (as well as other required disclosures) the purchaser has certain remedies under Tennessee law.  Specifically, TCA § 66-5-208(a) provides as follows:


(a) The purchaser's remedies for an owner's misrepresentation on a residential property disclosure statement shall be either:

(1) An action for actual damages suffered as a result of defects existing in the property as of the date of execution of the real estate purchase contract; provided, that the owner has actually presented to a purchaser the disclosure statement required by this part, and of which the purchaser was not aware at the earlier of closing or occupancy by the purchaser, in the event of a sale, or occupancy in the event of a lease with the option to purchase. Any action brought under this subsection (a) shall be commenced within one (1) year from the date the purchaser received the disclosure statement or the date of closing, or occupancy if a lease situation, whichever occurs first;

(2) In the event of a misrepresentation in any residential property disclosure statement required by this part, termination of the contract prior to closing, subject to the provisions of § 66-5-204; or

(3) Such other remedies at law or equity otherwise available against an owner in the event of an owner's intentional or willful misrepresentation of the condition of the subject property.


As a result, it is very important to make proper real estate disclosures under Tennessee law to avoid a lawsuit over improper disclosures.  These requirements now include sinkholes.  Also, even though the definition of a sinkhole appears to be rather narrow, I would not want to risk non-disclosure of a sinkhole even if it does not meet the technical definition.


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TAGS: Real Estate, 2015 Tennessee Legislation
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Jason A. Lee is a Member of Burrow Lee, PLLC. He practices in all areas of defense litigation inside and outside of Tennessee.

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Tennessee Defense Litigation Blog
Jason A. Lee, Member of Burrow Lee, PLLC
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E-mail: jlee@burrowlee.com