One of the things that I do as part of my real estate-related businesses (home inspections, HVAC, and pool construction) is have my attorneys keep track of real estate-related lawsuits. I want to know why members of the public are suing Realtors, home inspectors, and other professionals who work in, or on, real estate.
My intent is to make sure that my companies have already put into place business protocols to address the cause of the lawsuit, or to develop those protocols and get them into place rapidly if the cause of the lawsuit is something new, such as when a lawsuit is related to new technology.
Unfortunately, in this litigious nation of ours -- which seriously needs tort reform -- too many lawsuits are frivolous, and those frivolous lawsuits often are what many people call "broadcast lawsuits." It's kind of like fishermen in Third World countries that throw out a huge "broadcast" net and pull it in, figuring that the more territory one can cover with a larger net, the greater likelihood that one will catch something.
The same applies to lawsuits. If a Buyer sues his Realtor for anything at all after the close of escrow, I can almost guarantee you that additional defendants will be the other Realtor, the Seller, the Appraiser, the Home Inspector, the Termite Inspector, and anyone else who worked in, or on, the property at the time the cause of the lawsuit was alleged to have happened. The purpose is to cast a "broadcast" net and see who has the best insurance company with the deepest pockets.
Consequently, the more time you can spend with your Clients, establishing that all-important rapport with them, the less likelihood there is that you will be summarily sued if there is a problem. Rather, we hope that they will call you first to discuss the problem and see if everyone can work out an equitable solution without resorting to attorneys and the courts.
In working with my Clients in real estate, I'm always advising them to try to get their personal lives involved. That doesn't mean putting a picture of their exes on their business card with a Target logo on top of it or anything like that. Rather, it means taking your hobbies, interests, and even avocations and using them as part of your marketing. For example, if you play a musical instrument, sing, or simply support the arts, don't hesitate to use musical notes as separation bullets between your name and your company, between your address, the city, the state, and the zip code. Whenever you create bullet lists on your marketing brochures and flyers, make that bullet a musical note. Such can be done with any of your hobbies or interests.
I have had many Clients choose me because they saw my interest in wildlife, or they saw that I disclosed "about me" that I grew up singing and playing the piano and violin. I also have many Clients who have reported back to me that someone chose them because they used something personal about them in their marketing.
I've even had one Client ask me about buying some Zoo photos for her to use. How cool is that? Make it personal. After all, even though you are a real estate professional, you're also in a personal relationship business.
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Remember to join the "Inspired By Nature" Group. We'll be having a contest momentarily.
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This week's blog posts (they will open in a new window)
not only is building a relationship with your client important in terms of mimizing the chance of lawsuit, but knowing clients on a personal level makes the transaction so much more enjoyable for the both of you.
Hey, Karen - I have quite a few attorney friends that I often go out to eat with, and I rarely fail to bring up the subject of real estate lawsuits and tort reform. Of course, I only have good attorneys as friends, so all of them are for tort reform (at least while they are around me - LOL).
Hey, Xinh - That is so true. It's always more fun to work with a friend than it is a stranger. Make them friends!
Hey, Diane - All one has to do is watch the gazillion judge shows on television to see some of the silly things that cause lawsuits, even among mom and daughter, father and son, etc. Invariably, though, it turns out that mom and daughter had lost contact with each other, quit communicating, quit being friends. Ditto with father and son. There's a fine line between being too businesslike and too personal. It's finding that fine line that makes being in business for oneself so much fun because one can break the rules if one wants to with the boss firing you.
Hi Russel, long time no talk to. Love the cat, I just adopted one myself. I totally agree about the rapoirt, it is necessary and part of my nature. Also...love the zoo photos.
Lawsuits...ah yes...my sister had a landllord in sunny California...and that was how he made his 6 figure living..suing people...for major offenses...like calling him when he was on the do not call list...desperate, lazy, unethical folks take all kinds of measures to make life legally miserable..blog on...got the sunshine...do ou want it back ?
Russel - First of all, let me tell you I think your slide show is fantastic. Secondly about the lawsuits. I am convinced that some folks will sue whether they have a legitimate suit or not. In the early 1990s, I sold a rural property. The buyer procured a Home Inspection, a Roof Inspiection, a Termite Report, a Well and Septic System Inspection.
After a few months, the Buyer took my Seller to Small Claims Court. It seems that the grass over the septic tank beneath a Willow tree had began to get greener, and significant septic repairs were required.
Fortunately, in court, we were able to demonstrate all the inspections that had been performed on the property, and that the Buyer had selected the Well and Septic inspector, and the report had found no defect to the system. I went along with my client to court. And I created a summary of all the reports, as well as the reports themselves, and other timeline events during the transaction.
When everyone finished speaking, I said, "Your honor, during the listing period, and on the day of escrow, the grass was not greener over the septic tank under the Willow tree." The judge ruled in my client's favor.
Hey, Myrl - I understand completely. The Buyer/new owner probably didn't know how to take care of a septic system and once it had failed, they needed someone else to pay for their stupidity. Been there, done that on that one.
The problem with "broadcast" lawsuits is that the prosecuting attorney knows that there is no case. If there were, he would sue the person who caused the problem. Instead, he knows that no insurance company wants to get into court, so they will settle out of court, sometimes for tens of thousands of dollars. He with the best insurance loses.
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The same applies to lawsuits. If a Buyer sues his Realtor for anything at all after the close of escrow, I can almost guarantee you that additional defendants will be the other Realtor, the Seller, the Appraiser, the Home Inspector, the Termite Inspector, and anyone else who worked in, or on, the property at the time the cause of the lawsuit was alleged to have happened. The purpose is to cast a "broadcast" net and see who has the best insurance company with the deepest pockets.
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It's a scary time for lawsuits, but you are so right about being personal. Great pictures, as usual.