To amend sections 321.261, 323.47, and 5302.30 and to enact sections 5302.31 and 5321.041 of the Revised Code to authorize the prosecutor and treasurer of a county with a population greater than 100,000 to utilize surplus delinquent tax collections to facilitate nuisance abatement of deteriorated residential buildings in foreclosure and to prosecute criminal and civil real estate transaction-related violations of the law, to require all taxes, penalties, and assessments known to be a lien against foreclosed property when the deed is transferred to be discharged out of the proceeds of judicial and partition sales, and to require a seller or landlord of real property to disclose whether the property was a site for the manufacture of methamphetamine if the seller or landlord has actual knowledge of that use.

Section 1. That sections 321.261, 323.47, and 5302.30 be amended and sections 5302.31 and 5321.041 of the Revised Code be enacted to read as follows:

Sec. 321.261.  (A) Five per cent of all delinquent real property, personal property, and manufactured and mobile home taxes and assessments collected by the county treasurer shall be deposited in the delinquent tax and assessment collection fund, which shall be created in the county treasury. The Except as otherwise provided in division (B) of this section, the moneys in the fund, one-half of which shall be appropriated by the board of county commissioners to the treasurer and one-half of which shall be appropriated to the county prosecuting attorney, shall be used solely in connection with the collection of delinquent real property, personal property, and manufactured and mobile home taxes and assessments.

Annually by the first day of December, the treasurer and the prosecuting attorney each shall submit a report to the board regarding the use of the moneys appropriated to their respective offices from the delinquent tax and assessment collection fund. Each report shall specify the amount appropriated to the office during the current calendar year, an estimate of the amount so appropriated that will be expended by the end of the year, a summary of how the amount appropriated has been expended in connection with delinquent tax collection activities, and an estimate of the amount that will be credited to the fund during the ensuing calendar year.

(B) In a county having a population of more than one hundred thousand according to the department of development's 2006 census estimate, from money appropriated to each office from the county's delinquent tax and assessment collection fund under division (A) of this section, the county treasurer and prosecuting attorney may expend a combined total of not more than three million dollars each year to assist townships or municipal corporations located in the county as provided in this division. Upon application for the funds by a township or municipal corporation, the county treasurer and prosecuting attorney may assist the township or municipal corporation in abating foreclosed residential nuisances, including paying the costs of securing such buildings, lot maintenance, and demolition. At the prosecuting attorney's discretion, the prosecuting attorney also may apply the funds to costs of prosecuting alleged violations of criminal and civil laws governing real estate and related transactions, including fraud, abuse, and predatory lending.

For the purposes of this division, "predatory lending" includes, but is not limited to:

(1) An act, conduct, or omission violating sections 1322.07, 1322.071, and 1322.075 of the Revised Code;

(2) Failing to provide a consumer with clear and balanced information regarding mortgage loan terms, the level of risk, and the severity of borrowing on terms that may result in a significant increase in payment obligation or negative amortization;

(3) Making unsubstantiated statements as to the future direction of interest rates, or one-sided representations about the cash savings or expanded buying power to be realized from a loan that may result in a significant increase in payment obligation or negative amortization;

(4) Any combination of factors caused by obscuring a significant risk under the loan that results in unfavorable and unjustifiable loan terms for a borrower.

Sec. 323.47.  If land held by tenants in common is sold upon proceedings in partition, or taken by the election of any of the parties to such proceedings, or real estate is sold at judicial sale, or by administrators, executors, guardians, or trustees, the court shall order that the taxes, penalties, and assessments then due and payable, and interest thereon, that are or will be a lien on such land or real estate at the time the deed is transferred following the sale, be discharged out of the proceeds of such sale or election. For purposes of determining such amount, the county treasurer may shall estimate the amount of taxes, assessments, interest, and penalties that will be payable a lien on the land or real estate at the time the deed of the property is transferred to the purchaser. If the county treasurer's estimate exceeds the amount of taxes, assessments, interest, and penalties actually payable that are a lien when the deed is transferred to the purchaser, the officer who conducted the sale shall refund to the purchaser the difference between the estimate and the actual amount actually payable of the lien. If the amount of taxes, assessments, interest, and penalties actually payable that are a lien when the deed is transferred to the purchaser exceeds the county treasurer's estimate, the officer shall certify the amount of the excess to the treasurer, who shall enter that amount on the real and public utility property tax duplicate opposite the property; the amount of the excess shall be payable at the next succeeding date prescribed for payment of taxes in section 323.12 of the Revised Code.

Sec. 5302.30.  (A) As used in this section and section 5302.31 of the Revised Code:

(1) "Good faith" means honesty in fact in a transaction involving the transfer of residential real property.

(2) "Land installment contract" has the same meaning as in section 5313.01 of the Revised Code.

(3) "Political subdivision" and "state" have the same meanings as in section 2744.01 of the Revised Code.

(4) "Residential real property" means real property that is improved by a building or other structure that has one to four dwelling units.

(B)(1) Except as provided in division (B)(2) of this section, this section applies to any transfer of residential real property that occurs on or after July 1, 1993, by sale, land installment contract, lease with option to purchase, exchange, or lease for a term of ninety-nine years and renewable forever. For purposes of this section, a transfer occurs when the initial contract for transfer is executed, regardless of when legal title is transferred, and references in this section to transfer offers and transfer agreements refer to offers and agreements in respect of the initial contract for transfer.

(2) This section does not apply to any transfer of residential real property that is any of the following:

(a) A transfer pursuant to court order, including, but not limited to, a transfer ordered by a probate court during the administration of a decedent's estate, a transfer pursuant to a writ of execution, a transfer by a trustee in bankruptcy, a transfer as a result of the exercise of the power of eminent domain, and a transfer that results from a decree for specific performance of a contract or other agreement between persons;

(b) A transfer to a mortgagee by a mortgagor by deed in lieu of foreclosure or in satisfaction of the mortgage debt;

(c) A transfer to a beneficiary of a deed of trust by a trustor in default;

(d) A transfer by a foreclosure sale that follows a default in the satisfaction of an obligation secured by a mortgage;

(e) A transfer by a sale under a power of sale following a default in the satisfaction of an obligation that is secured by a deed of trust or another instrument containing a power of sale;

(f) A transfer by a mortgagee, or a beneficiary under a deed of trust, who has acquired the residential real property at a sale conducted pursuant to a power of sale under a mortgage or a deed of trust or who has acquired the residential real property by a deed in lieu of foreclosure;

(g) A transfer by a fiduciary in the course of the administration of a decedent's estate, a guardianship, a conservatorship, or a trust;

(h) A transfer from one co-owner to one or more other co-owners;

(i) A transfer made to the transferor's spouse or to one or more persons in the lineal line of consanguinity of one or more of the transferors;

(j) A transfer between spouses or former spouses as a result of a decree of divorce, dissolution of marriage, annulment, or legal separation or as a result of a property settlement agreement incidental to a decree of divorce, dissolution of marriage, annulment, or legal separation;

(k) A transfer to or from the state, a political subdivision of the state, or another governmental entity;

(l) A transfer that involves newly constructed residential real property that previously has not been inhabited;

(m) A transfer to a transferee who has occupied the property as a personal residence for one or more years immediately prior to the transfer;

(n) A transfer from a transferor who both has not occupied the property as a personal residence within one year immediately prior to the transfer and has acquired the property through inheritance or devise.

(C) Except as provided in division (B)(2) of this section and subject to divisions (E) and (F) of this section, every person who intends to transfer any residential real property on or after July 1, 1993, by sale, land installment contract, lease with option to purchase, exchange, or lease for a term of ninety-nine years and renewable forever shall complete all applicable items in a property disclosure form prescribed under division (D) of this section and shall deliver in accordance with division (I) of this section a signed and dated copy of the completed form to each prospective transferee or prospective transferee's agent as soon as is practicable.

(D)(1) Prior to July 1, 1993, the The director of commerce, by rule adopted in accordance with Chapter 119. of the Revised Code, shall prescribe the disclosure form to be completed by transferors. The form prescribed by the director shall be designed to permit the transferor to disclose material matters relating to the physical condition of the property to be transferred, including, but not limited to, the source of water supply to the property; the nature of the sewer system serving the property; the condition of the structure of the property, including the roof, foundation, walls, and floors; the presence of hazardous materials or substances, including lead-based paint, asbestos, urea-formaldehyde foam insulation, and radon gas; and any material defects in the property that are within the actual knowledge of the transferor.

The form also shall set forth a statement of the purpose of the form, including statements substantially similar to the following: that the form constitutes a statement of the conditions of the property and of information concerning the property actually known by the transferor; that, unless the transferee is otherwise advised in writing, the transferor, other than having lived at or owning the property, possesses no greater knowledge than that which could be obtained by a careful inspection of the property by a potential transferee; that the statement is not a warranty of any kind by the transferor or by any agent or subagent representing the transferor in this transaction; that the statement is not a substitute for any inspections; that the transferee is encouraged to obtain the transferee's own professional inspection; that the representations are made by the transferor and are not the representations of the transferor's agent or subagent; and that the form and the representations contained therein are provided by the transferor exclusively to potential transferees in a transfer made by the transferor, and are not made to transferees in any subsequent transfers.

The form shall include instructions to the transferor for completing the form, space in which the transferor or transferors shall sign and date the form, and space in which the transferee or transferees shall sign and date the form acknowledging receipt of a copy of the form and stating that the transferee or transferees understand the purpose of the form as stated thereon.

(2) Not later than January 1, 2006, the director shall revise the The disclosure form to shall include a statement that information on the operation and maintenance of the type of sewage treatment system serving the property is available from the department of health or the board of health of the health district in which the property is located.

As used in this section, "sewage treatment system" has the same meaning as in section 3718.01 of the Revised Code.

(3) The director shall revise the disclosure form to permit a transferor of residential real property who has actual knowledge of the illegal manufacture of methamphetamine on the property to disclose that knowledge on the form.

(E)(1) Each disclosure of an item of information that is required to be made in the property disclosure form prescribed under division (D) of this section in connection with particular residential real property and each act that may be performed in making any disclosure of an item of information shall be made or performed in good faith.

(2) If an item of information is unknown to the transferor of residential real property at the time the item is required to be disclosed in the property disclosure form and if the approximation is not used for the purpose of circumventing or otherwise evading divisions (C) and (D) of this section, the transferor may make a good faith approximation of the item of information.

(F)(1) A transferor of residential real property is not liable in damages in a civil action for injury, death, or loss to person or property that allegedly arises from any error in, inaccuracy of, or omission of any item of information required to be disclosed in the property disclosure form if the error, inaccuracy, or omission was not within the transferor's actual knowledge.

(2) If any item of information that is disclosed in the property disclosure form is rendered inaccurate after the delivery of the form to the transferee of residential real property or the transferee's agent as a result of any act, occurrence, or agreement, the subsequent inaccuracy does not cause, and shall not be construed as causing, the transferor of the residential real property to be in noncompliance with the requirements of divisions (C) and (D) of this section.

(G) Any disclosure of an item of information in the property disclosure form prescribed under division (D) of this section may be amended in writing by the transferor of residential real property at any time following the delivery of the form in accordance with divisions (C) and (I) of this section. The amendment shall be subject to this section.

(H) Except as provided in division (B)(2) of this section, every prospective transferee of residential real property who receives in accordance with division (C) of this section a signed and dated copy of a completed property disclosure form as prescribed under division (D) of this section shall acknowledge receipt of the form by doing both of the following:

(1) Signing and dating a copy of the form;

(2) Delivering a signed and dated copy of the form to the transferor or the transferor's agent or subagent.

(I) The transferor's delivery under division (C) of this section of a property disclosure form as prescribed under division (D) of this section and the prospective transferee's delivery under division (H) of this section of an acknowledgment of receipt of that form shall be made by personal delivery to the other party or the other party's agent or subagent, by ordinary mail or certified mail, return receipt requested, or by facsimile transmission. For the purposes of the delivery requirements of this section, the delivery of a property disclosure form to a prospective co-transferee of residential real property or a prospective co-transferee's agent shall be considered delivery to the other prospective transferees unless otherwise provided by contract.

(J) The specification of items of information that must be disclosed in the property disclosure form as prescribed under division divisions (D)(1) and (2) of this section does not limit or abridge, and shall not be construed as limiting or abridging, any obligation to disclose an item of information that is created by any other provision of the Revised Code or the common law of this state or that may exist in order to preclude fraud, either by misrepresentation, concealment, or nondisclosure in a transaction involving the transfer of residential real property. The disclosure requirements of this section do not bar, and shall not be construed as barring, the application of any legal or equitable defense that a transferor of residential real property may assert in a civil action commenced against the transferor by a prospective or actual transferee of that property.

(K)(1) Except as provided in division (K)(2) of this section, but subject to divisions (J), (K)(5), and (L) of this section, a transfer of residential real property that is subject to this section shall not be invalidated because of the failure of the transferor to provide to the transferee in accordance with division (C) of this section a completed property disclosure form as prescribed under division (D) of this section.

(2) Subject to division (K)(3)(c) of this section, if a transferee of residential real property that is subject to this section receives a property disclosure form or an amendment of that form as described in division (G) of this section after the transferee has entered into a transfer agreement with respect to the property, the transferee, after receipt of the form or amendment, may rescind the transfer agreement in a written, signed, and dated document that is delivered to the transferor or the transferor's agent or subagent in accordance with divisions (K)(3)(a) and (b) of this section, without incurring any legal liability to the transferor because of the rescission, including, but not limited to, a civil action for specific performance of the transfer agreement. Upon the rescission of the transfer agreement, the transferee is entitled to the return of, and the transferor shall return, any deposits made by the transferee in connection with the proposed transfer of the residential real property.

(3)(a) Subject to division (K)(3)(b) of this section, a rescission of a transfer agreement under division (K)(2) of this section only may occur if the transferee's written, signed, and dated document of rescission is delivered to the transferor or the transferor's agent or subagent within three business days following the date on which the transferee or the transferee's agent receives the property disclosure form prescribed under division (D) of this section or the amendment of that form as described in division (G) of this section.

(b) A transferee may not rescind a transfer agreement under division (K)(2) of this section unless the transferee rescinds the transfer agreement by the earlier of the date that is thirty days after the date upon which the transferor accepted the transferee's transfer offer or the date of the closing of the transfer of the residential real property.

(c) A transferee of residential real property may waive the right of rescission of a transfer agreement described in division (K)(2) of this section.

(d) A rescission of a transfer agreement is not permissible under division (K)(2) of this section if a transferee of residential real property that is subject to this section receives a property disclosure form as prescribed under division (D) of this section or an amendment of that form as described in division (G) of this section prior to the transferee's submission to the transferor or the transferor's agent or subagent of a transfer offer and the transferee's entry into a transfer agreement with respect to the property.

(4) If a transferee of residential real property subject to this section does not receive a property disclosure form from the transferor after the transferee has submitted to the transferor or the transferor's agent or subagent a transfer offer and has entered into a transfer agreement with respect to the property, the transferee may rescind the transfer agreement in a written, signed, and dated document that is delivered to the transferor or the transferor's agent or subagent in accordance with division (K)(4) of this section without incurring any legal liability to the transferor because of the rescission, including, but not limited to, a civil action for specific performance of the transfer agreement. Upon the rescission of the transfer agreement, the transferee is entitled to the return of, and the transferor shall return, any deposits made by the transferee in connection with the proposed transfer of the residential real property. A transferee may not rescind a transfer agreement under division (K)(4) of this section unless the transferee rescinds the transfer agreement by the earlier of the date that is thirty days after the date upon which the transferor accepted the transferee's transfer offer or the date of the closing of the transfer of the residential real property.

(5) If a transferor of residential real property has actual knowledge of the illegal manufacture of methamphetamine on the property that is to be transferred, the transferor shall disclose that knowledge on the property disclosure form. The disclosure shall not include the names of the persons involved in the illegal manufacture of methamphetamine. If the transferor fails to comply with this required disclosure and the transfer is not yet complete, the transfer of the residential real property may be invalidated by rescission as provided in division (K)(2) of this section if the required disclosure is included on a disclosure form or an amendment of a property disclosure form but the transferee does not receive the disclosure form or amendment until the time described in that division, or may be invalidated by rescission as provided in division (K)(4) of this section if the transferee does not receive a property disclosure form in the circumstances described in that division. If the transferor fails to comply with this required disclosure and the transfer of property is complete, the transferee may bring a civil action in an appropriate court for invalidation of the contract on the basis of fraud or another appropriate cause of action. In addition to the procedure or civil action for invalidating the transfer, the transferee may bring a civil action for the recovery of any damages that the transferee suffers that result from or are related to the former use of the property in the illegal manufacture of methamphetamine.

(L) The right of rescission of a transfer agreement described in division (K)(2) of this section or the absence of that right does not affect, and shall not be construed as affecting, any other legal causes of action or other remedies that a transferee or prospective transferee of residential real property may possess against the transferor of that property.

Sec. 5302.31.  (A) This section applies to any transfer of residential real property that occurs on or after the effective date of this section by sale, land installment contract, lease with option to purchase, exchange, or lease for a term of ninety-nine years and renewable forever. For purposes of this section, a transfer occurs when the initial contract for transfer is executed, regardless of when legal title is transferred. References in this section to transfer offers and transfer agreements refer to offers and agreements in respect of the initial contract for transfer.

(B) Subject to division (D) of this section, every person who intends to transfer any residential real property on or after the effective date of this section by sale, land installment contract, lease with option to purchase, exchange, or lease for a term of ninety-nine years and renewable forever, who pursuant to an exemption provided in division (B) of section 5302.30 of the Revised Code is not required to deliver to each prospective transferee or prospective transferee's agent a completed property disclosure form pursuant to that section relative to the residential real property that is to be transferred, and who has actual knowledge of the illegal manufacture of methamphetamine on the residential real property that is to be transferred shall disclose that knowledge to each prospective transferee or prospective transferee's agent. The disclosure shall be in a written "methamphetamine disclosure notice," shall be signed and dated, shall be provided to the transferee or agent as soon as is practicable, and shall be provided in the manner specified in division (I) of section 5302.30 of the Revised Code. The methamphetamine disclosure notice shall not include the names of the persons involved in the illegal manufacture of the methamphetamine.

(C) If a transferor of residential real property to whom division (B) of this section applies fails to comply with the disclosure required by that division and the transfer is not yet complete, the transfer of the residential real property may be invalidated by rescission as provided in division (K)(2) of section 5302.30 of the Revised Code if the required disclosure is included on a methamphetamine disclosure notice but the transferee does not receive the notice until the time described in that division, or may be invalidated by rescission as provided in division (K)(4) of that section if the transferee does not receive a methamphetamine disclosure notice after the transferee has submitted to the transferor or the transferor's agent or subagent a transfer offer and has entered into a transfer agreement with respect to the property. If the transferor fails to comply with this required disclosure and the transfer of the property is complete, the transferee may bring a civil action in an appropriate court for the invalidation of the contract on the basis of fraud or another appropriate cause of action. In addition to the procedure or civil action for invalidating the transfer, the transferee may bring a civil action for the recovery of any damages that the transferee suffers that result from or are related to the former use of the property in the illegal manufacture of methamphetamine.

(D) A transferor of residential real property is not liable in damages in a civil action for injury, death, or loss to person or property that allegedly arises from any error in, inaccuracy of, or omission of any item of information required to be disclosed under division (B) of this section if the error, inaccuracy, or omission was not within the transferor's actual knowledge.

(E) Every prospective transferee of residential real property who receives in accordance with division (B) of this section a signed and dated copy of a methamphetamine disclosure notice shall acknowledge receipt of the notice by doing both of the following:

(1) Signing and dating a copy of the notice;

(2) Delivering in the manner specified in division (I) of section 5302.30 of the Revised Code a signed and dated copy of the notice to the transferor or the transferor's agent or subagent.

(F) The specification of the item of information that must be disclosed in the methamphetamine disclosure notice under division (B) of this section does not limit or abridge any obligation to disclose an item of information that is created by any other provision of the Revised Code or the common law of this state or that may exist in order to preclude fraud, either by misrepresentation, concealment, or nondisclosure, in a transaction involving the transfer of residential real property. The disclosure requirements of this section do not bar, and shall not be construed as barring, the application of any legal or equitable defense that a transferor of residential real property may assert in a civil action commenced against the transferor by a prospective or actual transferee of that property.

(G) The right of rescission of a transfer agreement described in division (C) of this section or the absence of that right does not affect any other legal causes of action or other remedies that a transferee or prospective transferee of residential real property may possess against the transferor of that property.

Sec. 5321.041.  If a landlord of residential premises has actual knowledge of the illegal manufacture of methamphetamine on those premises, the landlord shall disclose that knowledge to any prospective or current tenant of those premises. The disclosure shall not include the names of the persons involved in the illegal manufacture of methamphetamine. If a landlord fails to comply with the disclosure required by this section, the tenant may terminate the rental agreement for the residential premises and may bring a civil action for the recovery of any damages for injury, death, or loss to person or property that the tenant suffers that result from or are related to the former use of the residential premises in the illegal manufacture of methamphetamine.

Section 2. That existing sections 321.261, 323.47, and 5302.30 of the Revised Code are hereby repealed.