A BILL TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ENACTING THE "HOMEOWNER CONTRACT TRANSPARENCY AND FAIR DISPUTE RESOLUTION ACT" BY ADDING ARTICLE 3 TO CHAPTER 50, TITLE 27 SO AS TO REQUIRE SELLERS IN RESIDENTIAL REAL ESTATE TRANSACTIONS TO PROVIDE CERTAIN ADVANCE DISCLOSURE OF HOME PURCHASE DOCUMENTS TO BUYERS BEFORE CLOSING, INCLUDING DISPUTE RESOLUTION PROVISIONS AND LEGAL WAIVERS, TO PROVIDE REMEDIES FOR NONCOMPLIANCE, AND TO IMPOSE AN AFFIRMATIVE DUTY ON ATTORNEYS WHO CONDUCT CLOSINGS.
H5522 creates the “Homeowner Contract Transparency and Fair Dispute Resolution Act” and adds a new article to South Carolina’s real property code governing residential real estate closings. The bill requires sellers in residential transactions to give buyers the full, final versions of any home purchase documents containing arbitration clauses, mediation clauses, forum-selection terms, jury-trial waivers, or other legal waivers before closing—generally by the earlier of contract execution or 10 days before closing. It also requires those provisions to be presented in a separate document or separately titled section, with separate buyer initials or signatures, and in the case of legal waivers, in plain-language written disclosure.
The bill further sets substantive standards for enforceability. A dispute resolution provision must identify an accessible forum and provide enough information for a buyer to initiate a claim, and it cannot impose impracticable or inaccessible conditions. Provisions that conflict with other law on forum, governing rules, or claim procedures are unenforceable, and noncompliant arbitration clauses or waivers are void ab initio. If a seller materially changes a covered provision after disclosure, the seller must redeliver the revised documents and obtain a new buyer acknowledgment.
H5522 also creates enforcement mechanisms. A buyer may sue in circuit court to void noncompliant provisions and recover actual damages, attorney’s fees, costs, and other appropriate relief. Legal waivers first presented at closing are presumed void unless the seller proves the buyer had a meaningful opportunity to review and voluntarily agree. The bill additionally imposes an affirmative duty on attorneys conducting residential closings: they may not proceed unless the seller has complied, and noncompliance may subject the attorney to professional discipline.
The overall sentiment reflected in the bill text is consumer-protection oriented and supportive of transparency, informed consent, and fairness in home purchases. The stated legislative findings emphasize that buyers often see important waiver and dispute-resolution terms too late to meaningfully evaluate them, especially at closing. No committee transcripts or recorded votes were provided, so there is no available public discussion or voting history to indicate broader support or opposition.
The main point of potential contention is the bill’s impact on private contracting and closing practice. While the bill says it does not ban arbitration or alternative dispute resolution, it imposes detailed disclosure, formatting, timing, and enforceability requirements that could be viewed by sellers, builders, developers, and closing attorneys as burdensome. The attorney compliance duty and threat of disciplinary action may also be a focal point for concern, since it places responsibility on closing lawyers to verify seller compliance before a transaction can proceed.
The bill would add a new Article 3 to Chapter 50, Title 27 of the South Carolina Code, regulating residential real estate transaction documents and the enforceability of dispute-resolution clauses and legal waivers. It would affect sellers, builders, developers, buyers, and attorneys involved in closings by requiring advance disclosure, separate acknowledgment, and plain-language presentation of covered terms. Noncompliant provisions would be void or unenforceable, and buyers would gain a statutory cause of action with damages and fee-shifting remedies.
The bill’s stated purpose and structure reflect a generally pro-consumer, pro-transparency approach. It is framed as protecting buyers from last-minute presentation of arbitration clauses and waivers at closing, while expressly preserving the use of arbitration and other alternative dispute resolution methods if properly disclosed. Because no committee debate or votes are included, there is no recorded legislative sentiment beyond the bill’s own consumer-protection rationale.
Likely points of contention include the bill’s restrictions on how and when sellers may present arbitration clauses, forum-selection terms, and waivers, as well as the requirement that these provisions be separately disclosed and separately signed. Builders, sellers, and real estate attorneys may object to the added compliance burden, the presumption that waivers first shown at closing are void, and the potential for attorney discipline if a closing proceeds without full compliance. Supporters would likely emphasize informed consent and fairness for homebuyers, especially in newly constructed home sales and other transactions where standardized contracts are used.