legal: When a Buyer really should sue you….. - 01/24/09 04:07 AM

When a Buyer really should sue you…..
Having been in this business for many years, I never cease to be amazed at how cavalier some agents are with other people’s money and contract rights. It seems like another cycle of “sue-the-agent” for negligence and unprofessional conduct has begun with no less than four agents being successfully sued in the last six months in my market area.
Some agents, thankfully a minority, are more interested in closing the deal than preserving a buyer’s purchase considerations and in having a full understanding the condition of a property in which they are interested. … (0 comments)

legal: Watch Out for Local Association Vigilantes - 08/25/08 08:25 PM
As a Principal Broker, I regularly monitor state and local disciplinary proceeding to keep abreast of any trends or emerging  real estate  practice  areas that  are problems I should be aware of for my own company. Fortunately, my local Association (NVAR) has fairly reasonable folks serving on grievance and disciplinary panels. Unfortunately, that's not true in all jurisdictions.
The North Central Board of Realtors (Association) went out of it's way to either make an absurd example or to excessively punish one of their own for an offense that, by their own procedures, merited a much smaller consequence. The Realtor involved had … (4 comments)

legal: No More Junk Faxes Unless They Already Have An EBR................. - 07/20/07 10:00 PM
As noted by NAR, on Saturday, July 9th, 2005, President Bush signed S. 714, the Junk Fax Prevention Act, into law. The newly signed law does not legalize unsolicited fax advertisements or solicitations but does allow for an established business relationship exception. In summary, the new fax law is effective immediately and reaffirms the long-standing “established business relationship” (EBR) exception to the ban on unsolicited commercial faxes by establishing explicit statutory authority for the EBR; places no time limit on an EBR; requires all commercial faxes to include an opt-out provision on the first page of the fax and provide a … (5 comments)

legal: Emotional Distress Claim - Developing Gestational Diabetes - Subject to Arbitration - 07/19/07 08:12 AM
A California court has considered whether an arbitration clause in purchase agreement could still be invoked when the clause excluded claims for bodily injuries and buyer claimed to have contracted gestational diabetes from the distress caused by the property’s termite infestation. Denna and Kenny Gravillis, Jr. (“Buyers”) purchased a home. The Buyers were represented in the transaction by Coldwell Banker Residential Brokerage Company (“Brokerage”). The purchase agreement used in the transaction was the standard purchase-and-sale form prepared by the California Association of REALTORS® (“CAR”). The form contains an arbitration clause which requires the purchaser and the seller to arbitrate all claims … (0 comments)

legal: Finally - Bill Making Mortgage Fraud a Crime - 07/05/07 11:23 PM
Newly approved legislation criminalizes mortgage fraud for the first time in Florida, where the crime has reached epidemic levels in the wake of a real estate boom fueled in part by risky loans. Florida leads the nation in mortgage fraud, and Miami-Dade and Broward counties lead the state. Senate Bill 1824 would make mortgage fraud a third-degree felony punishable by up to five years in state prison. If two or more properties are involved, the crime would be a second-degree felony punishable by a possible 15-year sentence. If signed by Gov. Charlie Crist, the law would take effect Oct. 1.
Cases … (5 comments)

legal: Is your 1031 Exchange Client getting ready to jump? - 06/29/07 08:39 AM

Before you “help” a prospect or client enter into a contract to participate in a 1031 Exchange, be certain both of you understand what you are about to do.
Taxpayers use Internal Revenue Code (IRC) §1031 tax deferred exchanges to defer paying capital gain taxes. Frequently, a taxpayer may consider exchanging out of or into property held for investment in a vacation or resort area. Many tax and legal advisors believe it is possible to perform an exchange on a vacation property that is held for investment purposes, provided the personal use is incidental (generally less than 14 days a … (4 comments)

legal: Minnesota Caller Ordered to Pay Brokerage $20,000 - 06/28/07 10:13 PM
A Missouri court became the second court to enter an injunction against Ryan Swanberg (“Caller”) and ordered him to pay approximately $20,000 in damages and attorney fees. The Caller had threatened real estate brokerages across the country with litigation last fall for allegedly not complying with the federal “Do Not Call” rules. This injunction also prohibits the Caller from “citing or relying upon the TCPA or its regulations as grounds upon which to make demands, seek payment of money or the compromise of any claims whatsoever”. 
The Caller employed the following method. First, he would contact a real estate brokerage via … (9 comments)

legal: Broker commits fraud - pays punitive damages - 06/28/07 10:04 PM
A California court has considered the appropriate level of damages that a buyer could recover after he was misled by broker. In July 2001, John Warren (“Buyer”) became interested in purchasing a property listed for sale by real estate broker Hildegard Merrill (“Broker”). However, the Buyer had a lot of personal problems at the time, such as the collapse of his business and neurological problems that impaired his cognitive abilities. In addition, no lender would extend him a loan because of an outstanding judgment against his company, even though his personal credit was in order. In order to help him acquire … (5 comments)

legal: Developer failure disclose soil problems remanded to trial court for further review - 05/17/07 10:58 PM
Utah’s highest court considers whether home developer had a duty to give purchasers a prior soil analysis report finding that the property’s soil could not support a large structure. Woodside Homes Corporation (“Developer”) purchased land to develop into the “Panorama Point” subdivision (“Subdivision”). One of the lots was purchased from the Church of Jesus Christ of the Latter-day Saints (“Church”). The Church had intended to build a large structure on the property, but abandoned its plans upon receiving the so-called “Delta Report”. This report found that the soil was collapsible because it contained an excessive amount of moisture and so was … (0 comments)

legal: How Agressive Should You be in Seeking Back-up Offers? - 05/03/07 10:44 PM
Alaska’s highest court has considered whether a listing broker improperly marketed a property in the MLS as “active” even though the property was still under contract. In 1998, Craig Lightle (“Salesperson”) of Realty Executives Alaska (“Brokerage”) listed a home for sale. On April 17th, the Williamses (“Buyers”) made an offer to purchase the property and the sellers accepted the offer. However, prior to the scheduled closing date of June 12th, the Salesperson learned that the Buyers’ loan application had been denied. Based on this information, the Salesperson decided to re-list the property in the multiple listing service as an active listing. … (5 comments)

legal: Anti-Leasing Covenant Found to Violate FHA - 04/26/07 10:12 AM
An Indiana court has considered whether a homeowner’s association enforcement of an anti-leasing covenant violated the federal Fair Housing Act (“Act’). In 1996, Algie and Edna McGlothin (“Owners”) purchased a residence in a housing complex known as Villas West II of Willowridge (“Villas”). The Villas were originally managed by the Jim Bagley Construction Company (“Construction Company”), but the Construction Company turned over management of the development to the homeowner’s association (“Association”) in May 2000. When the Owners purchased their unit, the purchase agreement contained a covenant which prohibited leasing within the Villas “for the protection of owners with regard to financially … (3 comments)

legal: "You talkin' to me???" - 04/19/07 04:44 AM
Injunction Entered against Minnesota CallerA Minnesota federal court has entered an injunction against Ryan Swanberg (“Caller”), who had threatened real estate brokerages across the country with litigation last fall for not complying with his request for their company “Do Not Call” policy within five days of the request. The injunction prohibits the Caller from “citing or relying upon the TCPA or its regulations as grounds upon which to make demands, seek payment of money or the compromise of any claims whatsoever”.
The Caller employed the following method. First, he would contact the real estate brokerage via facsimile and ask that his … (1 comments)

legal: Commission Awarded from Second Purchase Contract - 04/12/07 08:03 AM
A Missouri appellate court has considered whether a buyer’s representative could recover a commission when a buyer purchased property following the expiration of the buyer’s representation agreement after the initial purchase agreement between the parties had terminated because of the buyer’s inability to obtain financing. Patricia Zoll (“Buyer”) entered into a buyer’s representation agreement with Reece & Nichols (“Brokerage”) so that the Brokerage would aid her efforts to find a home and negotiate a sales price. The term of the agreement was from May 23, 2003 to July 31, 2003. The Brokerage located a suitable property, and helped the Buyer negotiate … (0 comments)

legal: Not in my neighborhood please……………………… - 03/22/07 04:47 AM
As reported by the Associated Press, The Happiest Place on Earth doesn’t want any new neighbors. The Walt Disney Co. has sued the city of Anaheim to stop the proposed construction of 1,500 condos, including several hundred low-income units, at the doorstep of Disneyland. Housing advocates say the units are desperately needed to accommodate workers who are essential to the city’s huge tourism industry but can’t afford to live there. Many workers spend at least four hours a day commuting from outlying areas where rent is cheaper. “We helped to build this resort, but now they’re saying we can’t live here,” … (2 comments)

legal: Prospective Buyer Cannot Recover for Injuries - 03/15/07 05:59 PM
An Ohio appellate court has considered whether a prospective buyer could recover compensation from a buyer’s representative for injuries suffered by the prospective buyer during her unaccompanied tour of a home under construction. Patricia Al-Sorghali (“Prospective Buyer’) contacted real estate salesperson Terry Golden (“Salesperson”) of Modene & Associates (“Brokerage”) about her interest in an unfinished home. The Salesperson contacted the listing broker about the home’s availability, and she told the Prospective Buyer she was not certain whether there was an open house scheduled that day but that the Prospective Buyer could take a look at the home by entering through the … (15 comments)

legal: Injunction Granted in Ohio Cybersquatting Case - 03/10/07 11:50 PM

An Ohio federal court determines that large brokerage is likely to succeed in its cybersquatting lawsuit against a competitor who had registered domain names which bore a strong resemblance to the brokerage’s registered trademarks and owner’s names, and so the court entered an injunction prohibiting the competitor from using these domain names.

HER (“Company”) is an Ohio corporation which provides real estate brokerage services under the name “Real Living”. The Company’s name is derived from the initials of its founder, Harley E. Rouda, Sr. His son, Harley E. Rouda, Jr., and his son’s wife, Kaira Sturdivant-Rouda, are both involved in … (2 comments)

legal: Counteroffer Is a Rejection of Earlier Offer - 03/06/07 10:45 AM
Counteroffer Is a Rejection of Earlier Offer A Florida court has considered whether a prospective buyer could choose to accept a seller’s counter offer to the prospective buyer, even after the prospective buyer had countered the seller’s counter offer. Theresa Polk (“Seller”) listed 181 acres of land for sale with a real estate broker. BHRGU Avon Properties, LLC (“Prospective Buyer”) made an offer to purchase the property on January 24, 2005. The Seller made two counteroffers (“Counteroffers”) on February 2 & 3, 2005, giving the Prospective Buyer until 5PM on February 7, 2005 to accept the offers. On February 4th, the … (33 comments)

legal: Broker Liable For Changing Terms of Partnership - 02/17/07 12:22 PM
 
A Maryland appellate court has evaluated whether a managing broker improperly attempted to alter partnership agreement between parties.

In 2001, Aaron Hargrove (“Hargrove”) and Jerry Mathis (“Managing Partner”) of Prudential REALTORS® and Mathis Realty, Inc. (collectively, “Brokerage”) entered into an independent contractor agreement (“Agreement”). Under the terms of the Agreement, Hargrove agreed to pay the Brokerage a set fee per month. In return, Hargrove retained 100 percent of his commissions and also was allowed to have four licensees working under him. Hargrove would not incur any extra costs for having these licensees work under him, except that these extra licensees … (5 comments)

legal: Nondisclosure Alone Cannot Overturn Arbitration - 02/17/07 10:24 AM
 
Federal appellate court reverses its earlier decision and determines that arbitrator’s failure to disclose his minimal contact with prevailing party’s attorney did not require vacating an arbitration award. New Century Mortgage Corporation (“New Century”) is a mortgage company. Positive Software Solutions, Inc. (“Positive”) has developed software for the mortgage industry, including its “LoanForce” software program. New Century obtained a license to use “LoanForce” from Positive. Positive believed that New Century was taking portions of the “LoanForce” software and copying it into other programs, and so Positive brought a patent infringement lawsuit against New Century. The trial court entered an injunction prohibiting … (0 comments)

legal: Realtor’s attorney defends 'white-flight' flyer incident - 02/09/07 04:48 AM
Merrillville, Ind., Realtor Mary Ann Winslow maintains her intentions were pure after town officials accused her of using scare tactics to encourage white homeowners to move from their neighborhood by citing a bogus bill that threatened to incorporate parts of the town and lower home values. So why did she do it? Read her attorney’s letter to find out.
A Merrillville, Ind., real estate agent maintains her innocence Jan. 2 for allegedly using scare tactics to encourage white homeowners to move from their neighborhood.  
In October 2006, town officials accused Mary Ann Winslow of distributing a flyer to some white residents … (8 comments)