Family says they bought property next to hazardous site and weren’t told. What’s required?

PHOENIX (AZFamily) — Imagine buying a property only to later learn it’s adjacent to a superfund site.

You’d expect the former owner or real estate agents involved would have disclosed that information prior to the sale, but the family involved said that didn’t happen.

Now, they’ve sunk their savings into the property and can’t afford to go anywhere else.

Arizona’s Family Investigates has been looking into this former mine and separate smelter site in Dewey-Humboldt for more than a year.

“We moved up from Phoenix,” Brittnay Duncan said.

Duncan and her partner wanted to give their three kids a better life.

“We wanted to get out of the city and live the country life,” she explained.

When they found the nearly 2-acre site in Dewey-Humboldt, just east of Prescott, at a price they could afford, they acted.

“I thought it was just an old shutdown mine but it’s a lot more than that,” Duncan said.

That massive pile of orange dirt is part of the former Iron King Mine. That dirt, also known as mine tailings, contains high levels of arsenic and lead.

It became a superfund site in 2008, designated as contaminated with hazardous substances. Sixteen years later, it still hasn’t been cleaned up.

Arizona’s Family Investigates has followed the town’s fight to change that.

The EPA is finally working on a plan to contain the tailings, test people’s properties, and remove the contaminated soil.

Arizona’s Family Investigates asked Duncan if someone had told her about the superfund site prior to the sale.

“Nobody, nobody ... and that tends to be the story for a lot of people in town,” she responded.

Duncan bought the property in January 2023. Arizona’s Family Investigates went through the closing documents. There was no disclosure form and no mention of a superfund site.

Since then, the EPA has tested her lot, and every chemical they tested for came back unacceptably high.

“Are my kids going to have cancer in 30 years like the rest of the town?” Duncan wondered.

Arizona’s Family Investigates looked into the former owner of her property, INA Group LLC, a business consulting company based in Nebraska. This was a foreclosure.

They did not respond to our calls and emails.

The real estate broker they used, KMF Real Estate, has an office in town.

“Real estate professionals’ job is to be the source of the source, not actually be the source,” Faye Humphrey, the co-owner of that branch and a longtime realtor herself, said.

She confirmed that an agent in her office represented INC Group LLC and said she stood by her work.

She said they provided Duncan with the buyer advisory form, a 13-page document that lists things buyers should look for.

Section 3, page 2, states superfund sites.

“I can’t possibly know what someone’s comfort level or tolerance would be for some of these things,” Humphrey said.

She explained that the superfund site didn’t come up in the title search and tax records.

“You have an office in town. It would seem to me that you would know that these properties are adjacent to superfund sites,” Cutler asked.

“Well, you know, I live in a very large county. I don’t know personally every piece of property and where it lays out,” Humphrey responded.

We raised questions about two current KMF listings: a 7700-square-foot home selling for $1.4 million and a half-acre plot on sale for $70,000.

Both are very close to the second part of the town’s superfund site, an old smelter and mine, but neither listing includes that information.

“One parcel looks very much like another. So, it would be almost impossible for someone like myself, I’m not an engineer and I’m not a surveyor,” Humphrey said.

“You have an obligation to disclose those things that you know about that could materially impact the value or consideration paid for the property,” Dave Degnan, a real estate attorney, said.

Degnan said that obligation includes the seller and the agents involved.

“At what point does it become imperative that they disclose what is going on?” asked Cutler.

“In my mind, I know it’s a copout answer but it’s always imperative you disclose,” Degnan responded.

He said those KMF listings are a gray area.

For Duncan, there’s no easy answer here.

“Unfortunately, we got it too cheap. There’s not enough money there to sue. So, we’re kinda stuck,” she explained.

Arizona’s Family Investigates also reached out to the Department of Real Estate, which said it’s a specific regulatory requirement that brokers disclose what they know about a property and that they’d expect KMF to do the same moving forward.

Consumers with concerns can file complaints with that department at File a Complaint | Arizona Department of Real Estate (azre.gov)

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