Couple Buys Dream Home For $300k, Get $900k Bill For Dam Maintenance

That’s “dam maintenance” not “damn maintenance. A Kansas couple scored what they thought was their dream home for $300,000: 20 acres with a beautiful view of the lush foilage-surrounded lake, bound in by a dam. A dam that has tree roots digging into it and could cost $900,000 to repair. And, under an agreement with the city from the 70’s that never turned up in the title search, is their responsibility to repair. And, title insurance will only cover the first $330,000.

Hutchinson homeowners surprised with $900,000 bill for dam [Hutchnews] (Thanks to James!)

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  1. Buckus says:

    Isn’t that what Title Security is for?

    • Loias supports harsher punishments against corporations says:

      Is that the same as title insurance?

      • microcars says:

        the article says Title Insurance would be limited to $330K best case scenario in this instance.

        I think the Title Company is only liable for the actual price of the house, so they could get their money back and the Title Company Insurance would then own it (and then be liable for the repairs!)

    • dangerp says:

      My thoughts exactly. Time for a pleasant conversation with your title company.

    • DariusC says:

      In before the “blame the consumer, not the government” comments…

      Of course there is always a way to stop things! Got cancer in your leg? Hack it off right now! You see a drunk driver coming at you? You should have dodged!

      Amazing…

    • BadgerPudding says:

      I don’t think a title insurance would cover a $900k bill.

    • chaesar says:

      RTFA

      “An attorney for the McGonigles, Edward Robinson of the Wichita firm Joseph and Hollander, has made a written demand to the title company for payment under the title insurance policy. Even under the best scenario, the McGonigles would receive only about $330,000 from this claim.”

      • Buckus says:

        Hey, thanks for insulting me. I get my news in one-paragraph sound bites provided by the consumerist, then form an opinion based only on that one sound bite. No need for critical thinking here.

        It’s early..I need another cup of coffee.

      • nova3930 says:

        I wonder if the agreement stipulates that the dam has to exist?

        $300k should be more than enough to drain the sucker dry and dynamite the dam into oblivion.

        • chaesar says:

          yes, the dam exists to hold back the lake and no lakeview-holding property owner is going to let these guys drain the lake to save their hides

          • chaesar says:

            damnit now I need to re-RTFA, it sounds like the lake is exclusively on their property….

            it would significantly lower property value to replace “lakeside” with “crater-side” but they wouldnt go bankrupt….

            • windycity says:

              Actually, you and nova both need to re-RTFA because if you did, you would see that the primary concern here is not the lovely view but the fear of flooding the homes on the other side of the dam. Without the dam, the homes will flood. Simple as that. You could drain the lake, but the water would still come and flood homes because the lake and dam catch and hold water runoff from hundreds of acres upstream.

              This is more than an aesthetics issue.

              • paul says:

                Maybe the people on the “bad” side of the dam would be willing to donate to keep their homes above water…

              • FrugalFreak says:

                Then the homes on the other side need to pay too!

              • FredKlein says:

                Without the dam, the homes will flood. Simple as that. You could drain the lake, but the water would still come and flood homes because the lake and dam catch and hold water runoff from hundreds of acres upstream.

                But mention is made of a spillway, and an auxiliary spillway. This means there is a way for water to get (“spill”) out of the lake. Now, after it exits the lake, I doubt it just sits there, it must drain away somehow. So, start emptying the lake slowly, allowing as much water out as to not over flow the method of drainage. Once the lake is empty, the incoming water can flow straight through to the outflow. Heck, make some nice channels for it to flow along, with walkways next to them, and tiny little chirping birdie… er, where was I?

          • nova3930 says:

            Whether those property owners can do anything to prevent removing the lake is a totally separate question. All I’m talking about is the agreement between the city and the property owners.

            If my consulting attorney told me there was no provision that the lake had to exist, I’d drain it dry before anyone was the wiser. It might create another problem later, but it solves the immediate problem as no dam = no maintenance costs

            • mythago says:

              You should probably continue to consult with your attorney before pulling a clever stunt like that. Attorneys have enough problems with alcohol without having to deal with clients who say “I just solved the problem!” and make things about a zillion times worse.

              • koalabare says:

                My dad is a lawyer and I think clients who say “I just solved the problem!” and make things about a zillion times worse are what he spends a large portion of his day with.

  2. microcars says:

    Title Insurance + sue previous owners for ignoring maintenance as listed in the article!

    • TuxthePenguin says:

      Bingo! Use that to threaten the Title Insurance company.

      “We’ll only pay you $330k.”

      “Fine, here are the keys. We’ll take that and the house is yours. Have fun with that million dollar repair bill.”

      • sirwired says:

        What kind of a threat is that? Why would the title insurance company agree to take over the deed? Their only responsibility is to pay out up to the policy max on the insurance policy. (The lion’s share will go to pay off the mortgage balance, and the owners get to keep the leftovers.)

        The insurance company doesn’t have any obligation to make the problem go away, they just cut a check and move on.

      • Link_Shinigami says:

        I’d actually love to see this happen. Could you imagine how awesome that would be?

    • Shadowman615 says:

      I wonder if there can be any negligence claim against whoever did the title search?

      • Sumtron5000 says:

        Thats what I thought. My dad does title searches, so I have a limited understanding of it. He has title insurance in case he screws up royaly. I would assume that if his title insurance doesn’t have a high enough limit, he (or the company he works for, if he weren’t self employed) would be sued for the remainder. Otherwise, wouldn’t all title searchers just carry a low limit, if they’re not responsible for anything above the limit?

        • Sumtron5000 says:

          Unless 330k is the value of the home… I was thinking that 330k was the limit on the policy. I thought title insurance was like auto or home insurance, where the policy pays up to the limit and the policyholder is responsible for the rest, but I’m assuming I’m wrong…

    • microcars says:

      update,my Realtor wife says the agreement between the owners and the city might not be a transferable agreement and that may be why the Title Company did not include it in the first place.
      The town would now be liable for any maintenance (the town would have to sue the previous owners/estate regarding this issue)
      More info on this may come out later, but the new homeowners AND the Title Co might be off the hook if this true.

    • Caffinehog says:

      Sue the previous owners for not disclosing a material issue…. and hope they have enough money to make it worth it.

  3. diasdiem says:

    That’s a lot of money for maintenance, but there’s no need to swear.

  4. HalOfBorg says:

    Just be certain to take a lot of dam pictures before they do any dam maintenance. Dam dam workers.

  5. clint07 says:

    I would think this would be less about the title search and more about the responsibility of the previous home owner & realtor to disclose any issues like this. It should also be noted that the current homeowners never signed an agreement with the city, so depending on the language of the document, they might be able to get out that way but would need a lawyer to really determine that.

    • the Persistent Sound of Sensationalism says:

      I agree. This seems no different than selling a used car and claiming that it is in perfect working order when the transmission needs to be replaced.

      It also seems that since the city was able to zone property below the dam for housing, and that it was subsequently developed, that it has become their responsibility to maintain the dam.

      The biggest concern to me though, would be that the previous owners were well aware of the agreement, since they signed it twice and received notifications from the government on multiple occasions since the signing. It appears from the article that they never maintained the dam since they’d been getting notifications about trees since 1981. I’d be interested to know why they signed the agreement if they never intended to do maintenance. Were they just stupid, or dishonest?

    • Karita says:

      Such agreements tend to run with the land, so the homeowner probably can’t get out of it just because they didn’t sign it. I’d love to see if it was the title searcher who missed it (i.e. it was recorded but they only did a Grantor search.) If I were that searcher, I’d be putting my carrier on notice right about now.

      • Pepster says:

        Generally though, Easements are listed on the deed paperwork, which would usually contain a map of the property owned including any such easements or right-of-ways.

        This agreement sounds like it was not listed on the title/deed, and thus probably doesn’t go with the property.

        As someone said, it’s going to be touggh to hold the new owners to an agreement they weren’t a party to, never saw, never signed, and is not attached to the title.

    • osiris73 says:

      Our property has an easement/road running through it to get to a tower farm. WHen we bought the house, we had to sign a form that made us aware of this agreement and that we agreed to continue with it. I have a very hard time believeing that the OP didn’t hav to sign a similar form stating as such. Just like when you buy a house with taxes owed upon it, you have to be made aware of them and must sign paperwork stating as such. An agreement with the original landowner can’t be, that I can imagine, valid unless the new owner agrees to take over that responsibility.

      If its an easement type situation, then the party responsible for originally building the dam and/or who benefited from it’s construction, would be responsible. I wonder if the original owner of the land also lived in the OP’s house and sold off the land that has since been developed? Hmm… I would think the responsibility to maintain the dam would remain with the person who originally made the agreement, or, if the houses built upon the property subsequently developed after the land division formed a legal homeowner’s association, then they may be liable for the costs or repair.

      Having said all that… if something looks too good to be true, it probably is.

  6. c!tizen says:

    Title insurance to the rescue! And, I never say this because I don’t really see many situations where it’s warranted, but sue the shit out of the previous homeowners and their agent. A house with 20 acres on a lake should sell for waaaaaaaay more than $300,000.00, they knew something was up.

    • DariusC says:

      Of course, because every deal is suspicious. Woot must be like an unscrupulous finance manager right?

      • c!tizen says:

        Woot sells cheap crap to bargin hunters, that’s what they do. We’re talking about a house and a lot of premium land, major difference.

    • Julia789 says:

      Title insurance only covers the value of the mortgage. It won’t cover any amount above that, as happened here. The mortgage was $300K, the dam repair is $900K.

      • Azagthoth says:

        An owners policy would actually cover the purchase price, which seems to be about 30k more here.

    • teke367 says:

      In Hutchinson Kansas, depending on where, you can get 20 acres for less than $300k, can’t find a direct match, but here are two 10+ acre homes for less than $200k:

      http://www.realtor.com/realestateandhomes-search/Hutchinson_KS/price-50000-320000?sby=2&ofbm=20

      • c!tizen says:

        first, bravo for providing some insight with your comments, it’s refreshing!

        I should have posted this with my original comment, but I was in a bit of a rush.

        http://www.realtor.com/realestateandhomes-search/Hutchinson_KS/67502/price-300000-2000000?source=ig

        note the size of the land. In the zip code where this house is located, right around Panorama Lake, you can get a home with a little more than 40 acres for only $1,200,000.00. Other than that there are more ranging from 10 – 15 acres that sell for almost $700,000.00.

        Any listing agent selling a house in that area wouldn’t tell a customer to let a 20 acre lake front property go for $300,000.00 unless there was a good reason. With a 3% vested interest in selling the land, the agent and the sellers knew. That paperwork should have been in the disclosure documents. Like I said, take the $330k from the title insurance and use it to sue or settle.

        • CyGuy says:

          “10-12 acre properties sell for $700,000″

          So subdivide your lot, spend $130 to build a house on half of, and sell that half with the house for $700k. The $570k net plus the $330k from the title insurance covers the cost of repairing the dam.

          (also see my other comment about adding hydroelectric generation to the dam to pay for future maintenance).

  7. chaesar says:

    everybody RTFA

    “An attorney for the McGonigles, Edward Robinson of the Wichita firm Joseph and Hollander, has made a written demand to the title company for payment under the title insurance policy. Even under the best scenario, the McGonigles would receive only about $330,000 from this claim.”

  8. Nikose says:

    …You know, this just leads to something entirely different- If you don’t want to fix the Dam, why not do what every child has always wanted to do, and blow it up? If it’s on your property, and you own it, remove it.

    Let the city know your intentions, and give them the option of correcting the issue and repairing it themselves- otherwise, let it blow. Dynamite is most likely less expensive, and you could invite kids to watch. Fun for everyone!

  9. johnva says:

    Sue the previous owners if they failed to disclose this. Unfortunately, they’re dead. But perhaps their estate could still be sued?

  10. Dallas_shopper says:

    I thought that’s what title insurance was for.

    • Dallas_shopper says:

      OK, read further; I’d take the $330k and bail, sticking the title company with the bill. That’s what they get for not doing their job properly.

  11. Loias supports harsher punishments against corporations says:

    An attorney for the McGonigles, Edward Robinson of the Wichita firm Joseph and Hollander, has made a written demand to the title company for payment under the title insurance policy. Even under the best scenario, the McGonigles would receive only about $330,000 from this claim, according to Robinson.

    So they are still humped for the other $600,000.

    • mikeP says:

      As mentioned previously, 330k covers their entire house investment. They then simply default on the house and the house ownership goes back to the title company.
      Their credit now sucks, but it is easy to explain and with 330k in their pocket it is worth it.

      • sirwired says:

        Home ownership doesn’t go to the title company, and nothing happens to their credit.

        The insurance company pays off the mortgage (if any) and the balance goes to the couple. The couple then ignore the demand to pay. The city places a lien on the title for the money. When the couple still doesn’t pay, the city takes over the deed. Property liens are not included in credit reports, as there is no loan to default on.

        Nobody’s credit gets hurt, and the city obtains title to the property, and it becomes their problem.

        • c!tizen says:

          “and it becomes their problem”… which then becomes a tax payer problem.

          • TechnicallySpeaking says:

            Which it should have from the beginning, if in fact land below the river is zoned for housing.

            • TechnicallySpeaking says:

              Dam, not river.

              Dam typos.

              • c!tizen says:

                damn typos!

                It should be a property tax problem for all of the owners in the area, not the whole town. Either way, there is no reason they should have to walk away from the house and let the city take over the land when they can possibly settle it in court and keep the house. I wouldn’t press the issue if it weren’t a “dream home”.

    • c!tizen says:

      I would take that $330,000.00 and hire a team of lawyers to sue the original homeowners and their listing agent for failing to disclose.

  12. GuyGuidoEyesSteveDaveâ„¢ says:

    Has anyone heard about the Dam Letter? The best part is it is true and happened. Never have I seen the word dam used in a letter so many times.

    • MongoAngryMongoSmash says:

      I was wondering when those dam beavers would make it into this dam post. +1

    • selianth says:

      About 15 years ago my hometown had a beaver problem. There were too many of them, and they were building too many dams. So they sent animal control officers out to neuter all the male beavers. Poor little guys. (Dave Barry even mentioned it in one of his columns – I’d never been so proud in my life.)

  13. Skankingmike says:

    1. Sue Title Insurance
    2. Sue Realtor
    3. Sue previous owners
    4. Sue town for neglecting inspection over 30 years.
    5. Deed land over to town. as part of a settlement with town
    6. watch as your property taxes sky rocket when they use special assessment.

    • Koinu says:

      It looks like the city was doing inspections, and the previous house/estate owners failed to do anything about it.

      • ellemdee says:

        As long as the previous owners were informed by the city of these problems (which it sounds like they were), they (the previous owners) should be at fault for not disclosing a known problem before the sale took place and, therefore, should be on the hook for an repair costs.

  14. ScottyB says:

    In my experience, most people are incredibly stupid.

  15. zibby says:

    hEy gUys did ne1 think of tiTle insurence?!

  16. TinaBringMeTheAx says:

    Surely your meant “foliage,” not “foilage.”

  17. RickinStHelen says:

    I feel badly for the owners. Tehy were let down by the pervious owners, the Realtor, and by the title insurance folks. I don’t see any way out of this but litigation. That said, if you buy property with a dam or pond, there should be red flags that go off on potential liability. A serious talk with your insurance agent about coverage must take place. Dams do fail (ask the folks at the Wisconsin Dells). I would not want to be liable for the failure of a dam that could effect homes down stream.

    • microcars says:

      why were they let down by the Realtor?

      • RickinStHelen says:

        Do you remember the National Association of Realtors commercial about why you should use a Realtor instead of a real estate agent. In it the Realtor saw flooding potential instead of a great view of the lake. A Realtor should help you look for liabilities in a property that you may not see. Especially since they are (allegedly) experts as they do this every day while you do not. The Realtor should have questioned the maintenance costs and liability of a privately owned dam, and warned them about it. From the article in the paper, this did not happen.

        • Sneeje says:

          Ummmm, in a perfect world that would be great. Except for the part where the incentive structure gives no benefit to the Realtor to actually do that and I would be hard pressed to believe that even a small percentage of Realtors do what you suggest–they aren’t qualified engineers nor are they qualified architects. If you signed with a Realtor as an “agent” with a retainer and the contract actually specified that, then I would agree.

          A better question would be why they didn’t get a formal inspection of all structures on the property, which should include the dam.

          • RickinStHelen says:

            The Realtor doesn’t need to be an expert, only to suggest that the dam may be an issue, and to suggest that the inspection include the dam. Part of the whole presenting possible issues part of the commercial I mentioned.

          • zekebullseye says:

            Best dam comment yet.

        • CherieBerry says:

          What is the difference between a Realtor and a Real Estate Agent?

      • jsl4980 says:

        The realtor should know to look into issues about lake, pond, stream, or dam maintenance. I’m sure every realtor in that area knows about those potential issues now. Hopefully other realtors around the country will hear about this problem and look into these kinds of issues if they ever help buy/sell property that has a lake, pond, or dam.

  18. yessongs says:

    DAM!

  19. Applekid ┬──┬ ノ( ゜-゜ノ) says:

    The thing is, they’re not thinking like a corporation. They should contact the city leaders and say how repairing the dam will stimulate jobs and the local economy, and how important it is for the next election that half the town doesn’t get flooded.

    Then they need to use that to get the taxpayer to subsidize the repair, estimate the fix at $333K, then through “a series of unforseen events”, go over budget.

    Bonus points if they can use the overage as a loss and avoid paying taxes that year.

    • Eat The Rich -They are fat and succulent says:

      Dayum! You should be a CEO! Beautiful AND amoral all at the same time!

    • peebozi says:

      There’s one major problem with your strategy.

      First, when do they get to fcuk the rest of the town? And number B, i didn’t see anything about them actually profiting obscenely.

  20. erratapage says:

    I think the title insurance and the old owners are on the hook for this one. The downside? I’m not sure the new owners will actually be able to keep the house. A better solution might be for the city to re-examine that 1977 agreement and maybe work out something that will actually result in saving both the dam and the property.

  21. ssaoi says:

    Drain it.

  22. sirwired says:

    This is not really a huge problem:

    1) They file with title insurance and get their money back, and use it to pay off the mortgage.
    2) They refuse to pay for the dam work.
    3) The city places a lien on the property when they don’t pay.
    4) The property reverts to the city when it fails to sell at auction. (Or, some poor schmuck thinks they’re getting a deal at auction, and it reverts back to the city again when the new owners get the bill (without benefit of title insurance, which you most certainly can’t get at a govt. lien auction.)

    The only issue for the homeowners is that they would not receive any payment for improvments they made to the property.

    • peebozi says:

      keep the money and hide it offshore. don’t make any mortgage payments and let the bank repossess. then the bank’s gotta fix the damn.

      oh wait…it continues:

      the bank would be down $1.2m, borrow 10 times that much at 0% interest then buy guaranteed taxpayer treasuries at 2% and come out ahead.

  23. Krusty783 says:

    In the linked article, it says that one of the signatories of the 1977 agreement and an updated agreement signed in 1981 sold the property to the unwitting couple. The signatory then approached the city about creating a subdivision adjacent to the property he sold, starting this snowball down the hill.

    Obviously the guy duped the people into buying the property. The agreement was not disclosed at the sale and this guy is obviously trying to profit from this. The OPs should have their lawyer move to void the sale due to lack of disclosure and approach the county DA with the evidence for fraud charges against the guy who sold them the property.

  24. c!tizen says:

    $330,000.00 will buy a hell of an attorney.

  25. EverCynicalTHX says:

    Two words…title insurance.

    ..lol!

  26. Pax says:

    Aren’t you supposed to be able to sue the person who sold you a property, if there are repair expenses which the seller didn’t notify prospective buyers about?

  27. BeerFox says:

    Go knocking door-to-door on the houses in the floodplain:

    “Hi! We’re the folks who just bought the house by the lake. Just wanted to give warning – once the sale was complete, the city brought out a secret agreement that I’d never seen or signed, stating that I’d have to pay a million dollars to repair the dam. They then ran off giggling, calling ‘No givesies backsies!’ over their shoulder. Well, I don’t have a million dollars, but I’m a DIY kinda’ guy, so I figured I can take care of this myself; just wanted to warn the folks downstream!”

  28. thatotherguy says:

    I think the best course of action is to try and void the sale. The new owners bought it directly from the original owners who did not disclose the issues with the damn or that the property owners would be required to pay for it. They obviously new about the damn’s maintenance issue because the old owners were the one’s who contacted the city regarding the damn’s maintenance so they could develop a subdivision in the damn’s flood plane. This has to break some sort of law.

    If the sale can not be voided and the new owners walk away from the mess, then the next step is to sue the prior owners both for failing to maintain the damn and for fraud when they misrepresented the property when selling it and tried to profit from that fraud by notifying the city so it can be repaired in order for them to develop a subdivision in the damn’s risk area.

    Another possible course of action is to take the title companies settlement and pay off the mortgage (it won’t cover much else). Then deed the damn and the lake to the city but attach a usage rights agreement so you can still use the lake.

    If all else fails. Sue everyone involved. List ever name on every piece of paper you received since you became interested in the property. List all living and dead signors of the original agreement, the original owners, the realtors, the title company, the city, everyone. Get everyone in a courtroom and let a judge sort it out.

    • A Pimp Named DaveR says:

      That was my first thought, too — but two years might be too long a gap for that.

      I think they’re likely to recover from the original sellers under other tort claims, though — if you can’t prove fraud (which may be possible here), you could probably argue unjust enrichment (as the lack of disclosure enriched the seller by an amount equal to the avoided repairs) or something like that.

  29. A Pimp Named DaveR says:

    I think some of you don’t understand what title insurance is….

    It’s insurance against impairment of your title by something unknown at the time of the sale. If there’s a later cloud, the title insurer pays you the difference between the purchase price and the value of the title subject to the impairment — which is why in this case the maximum that could be recovered is about the same as the purchase price.

    The title company does NOT get title to the land if you collect on a policy. They are not a guarantor of the sale; they just insure a specific risk. You still own the property. So letting the title insurer pay off still leaves them personally liable for whatever bills the city charges.

  30. mbd says:

    Title Insurance only reimburses you if it turns out that you do not have clear title to your land. It does not cover the lack of due diligence in determining any obligations or deed restrictions that may exist. That is why the problem never turned up in the title search, it is not a title issue.

    Secondly, the prior owner’s agreement with the city from the 1970’s is just clouding the issue. Ultimately, if the dam is on private property, the current property owner is responsible for it meeting code and being safe. If the prior owners, or the realtor, knew there was a problem and did not disclose it, of course they can be sued.

    Ultimately, these people need a good lawyer.

    I live in a town made up of small private lake communities, one of which recently had a similar problem when the state mandated that they replace their dam to meet current code requirements. They did not have the money to replace the dam, so they ended up draining the lake and demolishing the dam. End Of Problem.

  31. mudpie says:

    There may be an out for this couple. In Kansas the statute of limitations for written contracts is only 5 years. So a 1977 agreement may not be enforceable. The lawyer will have to haggle this out. They may also look into federal and state homeland security grant money.

    • A Pimp Named DaveR says:

      Not to get too technical, but that probably wouldn’t apply here. This is almost certainly a covenant that runs with the land, not a contract. As such, there’s no applicable statute of limitations.

  32. Warren - aka The Piddler on the Roof says:

    “Seems to me,
    You don’t want to talk about it.
    Seems to me,
    You just turn your pretty head and
    Walk Away…”

  33. Ben says:

    If you think that’s bad, you should see how much dam maintenance costs on Uranus!

  34. mexifelio says:

    +1 for article with the most “title insurance” responses

  35. humbajoe says:

    Solution: don’t pay it. It was never brought up despite them doing everything they were expected to do – not their problem.

  36. jim says:

    no dam will likely mean the “lakefront” property disappears totally

  37. balthisar says:

    Is there a case for malpractice from the title search company? Remember, title insurance is in case somethings wrong with the title or something was missed in the title search. Funny, that is, how you have to buy insurance from the same company that’s tasked with ensuring an unencumbered title in the first place! It’s like paying cash for a doctor, and then extra for insurance, just in case he leaves a scalpel or sponge inside of you.

    • A Pimp Named DaveR says:

      Possibly. It depends on whether a reasonable search would have turned up the agreement, which depends on whether the agreement was recorded as part of the deed. Based on the article, it probably should have been recorded with the original subdivision plat in 1977, since it appears to be in the nature of a covenant running with the land — but I’m not informed as to Kansas law on the subject, so I don’t know whether or not that’s the case. If the agreement was not required to be recorded with the title, then the title search company wouldn’t be liable to the owners for not finding it.

  38. valthun says:

    After reading the article it looks like there is a lot of failure on the part of the city and the previous property owners. The city and property owners ignored the inspectors and the city has the authority to effect repairs they didn’t do it. The previous owners ignored inspection results on maintaining the dam. Then the previous owner failed to show the details on the sale regarding that agreement. he should be on the hook for the bill, and the city needs to also take some of that burden.

  39. Clyde Barrow says:

    Isn’t this something that the previous owners needed to state in their contract? I mean, something that could become this serious of an issue I am almost certain that they knew fully well what they should have done to prevent it and had to do if they had stayed – which is fix the repairs. If that is the case, they deliberately left out this information hoping to con the new owners into this bill. I’d say sue the previous owners. They probably thought they could get away with this by merely selling the house.

  40. wkm001 says:

    Where’s the dam bait?

  41. H3ion says:

    Dan and Mary Beth Rich (the sellers) seem to be still alive and they are big targets for a lawsuit. This could be anything from negligent failure to disclose to outright fraud. One suggestion that the owners may want to consider is granting a scenic easement to the city in exchange for city maintenance of the lake. That would reduce the value of their property perhaps, but it also might make $900,000 something quite a bit less. Also, the city should agree to pick up a part of the cost which it can then pass on as a special assessment to the subdivision affected by the damn dam.

  42. JRam says:

    Looks like the title company just sued everyone.
    http://hutchnews.com/Todaystop/title-company-sues–2
    They are going after the original owners, current owners, and the city.

  43. ScottyB says:

    Damn that damn dam maintenance.

  44. cloudedknife says:

    so let me get this straight. the buyer paid value, without notice of a prior existing covenant affecting the property, in a notice jurisdiction and DOESN’T take free of the covenant?

    huh, okay then.

  45. consumeristjames says:

    This is so simple it’s not even funny:

    –collect $300,000 from title insurance first, since obviously the title company didn’t do it’s research
    –let the bank foreclose on the house since that’s the popular thing to do now days
    –use your $300k to buy another house

    Of course this completely screws the 362 other property owners if the damn fails and their properties are flooded, but they can easily file a nice class-action lawsuit against the city for not doing something earlier.

  46. soj4life says:

    just empty the pond

  47. CyGuy says:

    Can they add a hydroelectric generating station when they perform the maintenance and then borrow against the future revenue for electricity produced by the dam?

  48. smo0 says:

    The way I see it… you’re out the money for the house anyway… blow the dam, skip town…

    let those “non concerned” residents see the error of their ways… screw the town.