Real estate disputes are becoming more frequent in today’s market. Regardless of whether you are a residential property owner or a commercial real estate developer, it is highly likely you will find yourself in a dispute at some point.
The majority of real estate disputes can be settled out of court; however, litigation may be necessary if the parties involved cannot come to an agreed solution. If you do find yourself faced with a real estate dispute, it’s advised that you work alongside experienced litigation lawyers to ensure any issues are resolved quickly and efficiently.
Here we discuss some of the most common causes of real estate litigation and how you can potentially avoid them.
Failure to disclose important information
When selling a property, owners or developers must disclose any defects not fully visible that could potentially affect the value of the property. Failure to do so can lead to the buyer pursuing legal action, should they encounter these defects.
As a seller, you must be able to prove that you divulged all of the relevant information before the purchase was made, and so the defendants were well aware of the defects. Such property defects can include leaks in the property or the development of mould. If the buyer faces an unexpected cost for these defects that wasn’t their fault, you could be required to foot the bill.
Negligence and breach of duty
As a real estate agent, you have a legal duty to act in the client’s best interest and must steer clear of third parties. This means keeping all sensitive information related to the client confidential, including their financial situation.
You must also perform to the best of your ability for your clients and avoid making costly mistakes. Acting negligently can lead to your clients losing money, meaning you will be required to pay for the damages. As an example, leaving out certain information regarding the property to retain commission can lead to a lawsuit being brought against you.
Breach of contract
The buying and selling of properties always involve the signing of a contract, which includes the terms and conditions that both parties must agree and adhere to. The contract typically contains information regarding the closing date, financing and assets included in the property.
If you or the buyer fails to abide by these conditions, the other party has a legal right to sue for breach of contract. It’s vital that you carefully read every sales contract or have them reviewed by a qualified professional, who can advise you on any future red flags.
If you do come across issues concerning the real estate contract, it is always worth negotiating with the other party and finding some form of resolution outside of court.