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Negligence and Misrepresentation
Knowing that he would soon sell his chain of local restaurants, the owner
falsely inflated their apparent profit-making ability by overpaying his
taxes for several years. A couple purchased the business, using money
they had saved for retirement. The business eventually went bankrupt.
To determine the cause of the bankruptcy, the couple hired a forensic
accountant, who discovered the deceit of the former owner. The
couple sued the business broker who handled the transaction for
negligence and misrepresentation, claiming
damages of $347,000.
Lead Paint Poisoning
A woman sued a landlord after experts concluded that her
child suffered severe lead paint poisoning, requiring extensive
medical care, caused by paint at the residence. The property had
been represented as "lead paint free" by the real estate agent who
originally listed the property for the landlord. The jury
awarded $680,000
to the plaintiff, plus over $17,000
to cover the child's medical bills, but
rejected the defendant's claim that the agent was at fault. Although the
agent was found not to be liable, she
incurred over $10,000 in legal fees.
Delayed Mortgage Commitment
A potential homebuyer attempted to secure a mortgage
commitment from a mortgage firm that was a subsidiary of,
and was recommended by, the real estate agency listing the home.
The mortgage was delayed, and the buyer, who was also selling his
own home and didn't want to lose his own buyer, closed on the sale of his
home, leaving him with no place to live. The buyer then sued the
listing agent for negligence, seeking reimbursement for the
$5,000 out-of-pocket
costs the buyer had incurred.
Buyer's Due Diligence
A homebuyer sued the listing broker and the home seller,
alleging that water damage at the home he purchased was caused by a
spring that they knew about but didn't disclose. Although the buyer's
own home inspector had recommended that the buyer consult with a drainage
expert to determine the extent of the water infiltration problems,
the buyer did not follow this advice. The court sided with the broker
and seller, saying that the plaintiff had failed to exercise due
diligence and that he could not complain that others deceived him.
Though not liable for damages, the broker ended up paying
over $10,000
in legal defense costs.
Leasing Agent's Negligence
A landlord, seeking to evict tenants from space it wanted
to lease to a department store, instructed its leasing agent
to advise the tenants in a letter that the landlord did not wish
to renew their lease. The leasing agent did not send a letter, and
the tenants continued to pay rent to the landlord. When the landlord
attempted to evict the tenants, they refused. The tenants' attorney
demanded a premium of $292,000 to leave the premises. The landlord
sued the leasing agent for the $292,000 for negligence in failing
to send a non-renewal letter to the tenants. The leasing agent
pled innocence, explaining that the landlord said it intended to
renew the lease and never told the agent to send a letter to the
tenants advising them otherwise. The case was
settled out of court for $100,000.

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