There are many ways that a residential real estate transaction can devolve into a costly lawsuit, particularly when high-value residential properties are involved. From allegedly deficient property condition disclosures to commission disputes, there are nearly limitless ways in which a real estate transaction can give rise to litigation.
One of the most common issues in lawsuits involving real estate professionals is agency. Even after years of experience in a real estate profession, many realtors, brokers, title company managers and other real estate professionals do not have a full grasp of the agency relationship. By learning a little more about lawsuits involving the agency relationship, and by obtaining the right residential real estate attorney, real estate professionals can help keep themselves from being on the wrong end of a costly legal judgment.
The duties owed by brokers and agents to their clients are defined in state licensing laws and regulations, disclosures, and listing agreements. However, these duties can vary somewhat from transaction to transaction. Consumers may incorrectly expect services they are not entitled to, and agents may have responsibilities they are not fully aware of.
According to a recent survey from the National Association of Realtors, agency representation issues and the resulting disputes are the number one legal concern of real estate agents, brokers, lawyers and educators. Approximately 73 percent of real estate professionals surveyed cited agency issues as one of the top three sources of real estate disputes. In comparison, 68 percent included property condition disclosures as a top three source of disputes, and just 53 percent had ethics in their top three sources of disputes.
In the most recent biannual National Association of Realtors Legal Scan, 705 legal cases involving real estate professionals over two years were analyzed, and agency issues accounted for 159 of the cases. Commission disputes were the focus of slightly more cases at 168, but whereas the growth in commission dispute cases from the previous Legal Scan analysis was just four percent, agency issue cases increased by a whopping 36 percent.
Agency is a complicated area of the law. The best way for real estate professionals to avoid disputes in high value real estate transactions, and to address any disputes that may arise, is to get legal representation from an experienced residential real estate attorney. Contact an attorney today about your residential real estate issue.
Our law firm is ready to help. Contact the real estate and estate planning attorneys at Galloway and Collens, PLLC.