Most Common Causes of Real Estate Litigation

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Real estate disputes are becoming increasingly common in California. You may be embroiled in real estate litigation whether you are an individual property owner, a manager of a condominium association, a property management company, or a commercial real estate developer.

With a skilled property lawyer on your side, your dispute can usually be resolved out of court. With that said, litigation becomes necessary when the parties are unable to arrive at a fair resolution. You should consult with a reliable real estate litigation attorney to make sure your legal rights are protected.

Here are some of the common causes of real estate litigation in California:

Breach of Contract

Contracts prepared for real estate transactions may contain specific terms related to title clearance, assets included, closing date, and other things. The plaintiff (or the wronged party) will need to prove that they satisfied their contractual obligations while the defendant did not. The plaintiff may be able to claim compensation for any losses suffered as a result of the breach.

It’s best that you work with an experienced real estate attorney to avoid breaking any provisions. Your attorney will review the agreement and give you an explanation of the clauses so that you don’t inadvertently break them.

Not Disclosing Property Defects

The seller in real estate sales is obligated to disclose any known and non-evident defects to a purchaser. This is when the defects have an adverse impact on the value of the property. If a property buyer discovers an undisclosed defect later, they can initiate legal action against the property seller on the basis of the failure to disclose.

Taking this into account, for such a lawsuit to be successful, the plaintiff is required to prove that the defendant was aware or should have been reasonably aware of the defect. The plaintiff will also have to show that the defect was purposefully concealed by the defendant.

Breach of Duty or Negligence

Realtors and agents are legally obliged to act in their client’s interests and not the interest of a third party or salesperson. In addition, they are required to keep sensitive information about their clients confidential. Realtors also have a duty to inform the client of any information that will benefit them. The agent is required to perform these services to the best of their abilities and knowledge.

Boundary Dispute 

If property lines are not correctly set, it can result in real estate litigation. Property boundaries don’t get registered properly in most cases. Practical property lines may not be consistent with the legally registered lines. This can cause a dispute.

An easy way for the seller to fend off such disputes is to research legal property boundaries. You can speak with a real estate attorney to pursue action against any neighbors that are overstepping on your property. This is someone who has been through the legal corridors before and knows where danger likes to lurk.

Faulty Repairs 

Buyers can now easily find defects in a company through building inspection companies. In most sale contracts, the sellers agree to make repairs as requested by the buyer. Moreover, the quality of repairs may not be adequate.

Buyers can file a lawsuit against the seller in case of improper or faulty repairs. They can claim that the seller acted fraudulently. The seller can also file a lawsuit against any involved realtor.

Undisclosed Easements

An easement refers to a pre-existing agreement involving a specific piece of land or property. If a person or an entity has an easement, they essentially have the right to use the property for a specific purpose. This is regardless of who the new owner is.

The seller is required to disclose easements to a buyer before completing the real estate transaction. Easements can have a major impact on the purchasing decision. Undisclosed easements may lead to real estate litigation. The buyer may be unaware that an entity is granted lawful access to the property.

Title Defects 

The title may have a lien, mortgage, or other encumbrances. The seller may not be able to sell the property with these defects since the lender can claim ownership if the money owed to them is not paid.

A property title cannot be transferred to another entity if these encumbrances are not disclosed. In addition, real estate closing cannot be completed before having the title checked out. If the seller fails to disclose title defects and other encumbrances or fraudulently makes a sale, they can be held liable.

Breach of Construction Contract

Real estate investors and landowners that enter contracts with their construction companies can sue them if the scope of work is not carried out as outlined in the construction contract. The construction contract will also outline the legal rights and risks of both parties. Any failure to provide the duties as listed in the contract can result in real estate litigation.

Get Strong Legal Representation from a Knowledgeable Real Estate Attorney

If you are in the midst of an unraveling real estate dispute or have been wronged in a real estate transaction, the trusted real estate attorneys at Peterson, Martin & Reynolds LLP will make sure your rights are adequately protected. Our lawyers are skilled in litigation matters related to all kinds of residential and commercial real estate transactions.

To request a comprehensive consultation, call us at (415) 399-2900 or complete this online form.

Real Estate Law and Land Use Regulations in California

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California land use regulation is notoriously complex even though the market opportunities are significant for both investors and end-users. There are new and changing regulations applicable to California properties that must be considered and addressed when you are entering into a real estate transaction.

It is important to work with an experienced land use attorney to guide you through the complex maze of these regulations and provide the right legal advice on every aspect of your project.

Land Use Laws in California

There are several different laws in California that apply to land use at the federal, local, and state levels. These laws basically dictate the manner in which a specified use is allowed for different structures and purposes. You can identify permit and zoning regulations by utilizing an attorney. You can also address any issues you may have with permits.

It’s critical that local land use decisions are consistent with the general plans of a community, such as public works, use permits, subdivision approvals, and zoning. General plans obtain meaning and purpose with this requirement for vertical consistency. State government public works projects and permit decisions usually have sovereign immunity, which means they don’t need to follow local general plans.

Special districts and school districts are allowed by state law to override city and county general plans and zoning for carrying out their own public works projects. It’s best that you work with an attorney that offers experienced advocacy before regulatory boards, city councils, and commissions on your behalf.

Regulations When Handling Environmental Matters

Environmental matters related to real estate and land use are usually complicated. They generally involve different statutes, political concerns, case laws, and ordinances. Land use attorneys can help you stay on top of things in this ever-changing fabric. They will use their knowledge to advance your interests and get the results you are looking for.

It’s critical that you have the necessary tools and resources to manage and resolve any environment-related land use matter. This includes disputes as well. In California, local and state agencies are required to analyze and identify the potential environmental impact of a proposed project as part of the California Environmental Quality Act.

Real Estate and Land Use Regulatory Compliance

You should get proactive counsel if you have been accused of non-compliance in land use matters. These are a few environmental regulations you should be familiar with:

  • The National Environmental Policy Act
  • Proposition 65
  • The California Environmental Quality Act

Land Use and Litigation

It can be difficult to reach an amicable solution in some instances involving land use. Your case may need to be litigated in such situations. You should find top-rated representation for all your litigation issues.

The attorneys you consult with should have a deep understanding of eminent domain, regulatory takings, inverse condemnation, and California Coastal Commission violations among others.

Dealing With Condemnation in California

Condemnation occurs when a state, local, or federal government takes over privately-owned property by remunerating the owner. The government is allowed to do this for public use through eminent domain. You will receive a payment for your property.

But just because the government wants your property, doesn’t mean you need to approve the sale. You should speak with an attorney as soon as possible if you receive a notice of eminent domain.

Your attorney will use their experience in land development litigation to create a solid strategy for opposing the eminent domain. They will also help you determine a fair dollar amount for compensation if there is no way to stop eminent domain from being asserted.

The government can use eminent domain to take property for building schools, railroads, roads, and other public use projects. The government can also seize private property to help facilitate other private projects. This is not commonly known. For instance, the government may purchase land if there is a housing shortage in order to create condominiums and apartments.

Land deterioration is another reason for the government to purchase private property. And this can also be done without the property owner’s approval in some instances. This is another case in which it is important to speak with an experienced California land use attorney.

Legal Help is Here from Reputable Real Estate Attorneys in California

The attorneys at Peterson, Martin & Reynolds LLP have a deep legal understanding and the extensive experience needed to enable clients to overcome land use and development hurdles. Our attorneys have achieved proven results with cases involving eminent domain and other issues related to land use.

We work in a strategic and timely manner to help you accomplish your goals. Call us at (415) 399-2900 or write to us online to set up an initial consultation with one of our attorneys.

Who Can Claim Property Based on Adverse Possession in California?

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California is one of the largest states in the US in terms of land, and it is governed by complex real estate laws in both rural and urban areas. Under California law of adverse possession, your neighbors can possess parts of your property.

It is essential that you consult with an experienced real estate attorney immediately if you are worried about adverse possession or would like to know how to protect your legal rights.

Overview of Adverse Possession Laws

Adverse possession is a legal concept that allows a trespasser to obtain legal title over another person’s land. The concept first originated in Britain centuries ago. It essentially allows trespassers on the land to gain ownership of it. This occurs if the true owner of the land doesn’t object within a specified period of time or if the trespasser pays property taxes on the land.

The law has been kept alive in various states to achieve a fair result where one owner leaves their land unused or idle, while another has been tending it for a long time. In such instances, it is believed that making the trespasser leave the land should seem unfair or create an undue hardship. Adverse possession in California is defined and regulated by both state courts and statutes.

It is important to understand that government property in California is immune to adverse possession actions. For instance, if you attempt to annex a portion of the Big Basin Redwoods State Park, you won’t be able to claim ownership. This is even if you build a shed on the land and wait for 5 years.

Trespasser Needs to Prove Adverse Possession in California

There are a few hurdles the trespasser will need to clear before they claim a piece of your land in California using this approach. The burden of proof falls on the trespasser.

You will be presumed the owner of a piece of land as long as you hold the legal title to it. This is unless the adverse possessor comes up with enough compelling arguments and evidence against you to convince a judge to give them ownership of a piece or all of the land.

It is important to understand the difference between adverse possession and having an easement to use another person’s land. For instance, a neighbor may have an easement to use your driveway for accessing their property. But they cannot claim ownership of the land they are allowed to use. In adverse possession, there is a shift in the title and the owner gets a right to exclude others from the property.

Requirements for Adverse Possession in California

There is no single statute dictating the elements required to be established by a trespasser for proving adverse possession in California. The courts have instead established a wide array of such factors over several decades for issuing decisions in different cases.

Adverse possession in California, as in most states, is established from the nature and length of time of the possession. In California, a trespasser’s possession should be:

  • Accompanied with a color of title or claim of right. This means the trespasser should assert ownership even when they don’t have purchase documents or when they have title documents that make them look like the owner.
  • Hostile, which means it should be without the true owner’s permission or right.
  • Actual, which means the trespasser should exercise control over the physical property by continually improving it or enclosing it.
  • Open and notorious. The property should be used by the trespasser as if they are the real owner. They should place the original owner on notice and possess the property without hiding their occupancy.
  • Continuous for at least 5 years as per Cal. Civ. Proc. Code § 325

There is another vital element that needs to be established in California. The adverse possessor should show that they paid taxes on the property for all five years.

Action to Quiet Title to Cut Off Adverse Possession Claim

If you spot an encroaching neighbor or a trespasser on your California land, you should speak with the person and ask them to remove all structures from it. You should also ask them to refrain from entering your property. The person will likely comply with your request if it was an honest mistake.

If the trespass continues, however, you should immediately get in touch with an attorney and bring an action to quiet title. This legal recourse is available to property owners for determining the rightful owner of the land.

In this process, you will essentially ask a California state court judge to issue an order that declares you as the true owner or the title holder of the land and not the trespasser. Action to quiet title is usually helpful when a person is trying to sell their property and needs to reassure the potential property buyers.

Get a Dedicated Real Estate Lawyer on Your Side to Protect Your Rights

The seasoned attorneys at Peterson, Martin & Reynolds LLP are here to help you avoid the mistakes that can place your legal situation in jeopardy. Our real estate attorneys have a deep understanding of California laws and regulations and can provide the right advice for obtaining your goals.

To schedule a consultation with our property lawyers, call us at (415) 399-2900 or contact us online.

Conservation Easements in California

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Conservation easement refers to a voluntary agreement that places permanent restrictions on the use of a specific land for protecting its conservation values. Owners continue to control the piece of land by placing a conservation easement on it. While they can also take advantage of a tax deduction, they cannot usually develop it. The limits of conservation easement continue even when the land gets sold in a sale or passed on to an heir.

It’s best to consult with a real estate attorney in California to identify the right legal steps that will help accomplish your end goals regarding your property.

Everyone Doesn’t Qualify for Conservation Easement

Everyone cannot take advantage of a conservation easement. You can probably get a conservation easement if you meet any of the following four categories found in the IRS Code, Section 1.170A-14(d):

  • Preservation of a relatively natural habitat of fish, plants, or wildlife.
  • Preservation of agricultural lands or forests with open spaces.
  • Allowing public access to a portion of the land.
  • Protecting the property as per a clearly delineated government policy regarding local open-space plans.

Conservation easements are required to provide public benefits.

Tax Deduction on Conservation Easement

The primary benefit of a conservation easement is the tax deduction you will receive from it. You can deduct 50% of your income for the next 16 years until the appraised value of the easement. This means that if you make $60,000 a year, you can obtain a tax deduction of $30,000 for the next 16 years, which can amount to a total deduction of $480,000. Pertaining to this, this deduction is only up to the amount of appraised value of the easement.

Customizing a Conservation Easement

Conservation easements can be customized to meet your needs, depending on your plans for the property. The goal of an easement is to benefit everyone – the owner, the land trust, and the government agency.

Public Access Is Not Mandatory

While a few landowners choose public access as a condition of the conservation easement, this is a rare process. If you are worried about public access, you should know that this is not a requirement of the conservation easement. In other words, your land remains private property. By placing a conservation easement, you forego your development rights and prevent future development on the land you own.

Government Does Not Get Automatic Access

A conservation easement will not give the government direct access to your land. Most conservation easements are held by non-profit land trusts. These are designated by the IRS under section 501(c)(3).

These organizations play a role similar to tax-exempt companies and NGOs. In rare circumstances, a government entity may hold a conservation easement. Typically, government entities get involved in conservation easements when they audit or scrutinize the easement transaction.

No Need to Sacrifice Agricultural Production

Many people don’t want to get a conservation easement because they profit off the land in the form of ranching or agricultural production. You can work the productivity of your land into the easement. Conservation easements are flexible and you can work around your goals. The only thing you may not be able to do is future development.

You may still be able to use the land in the same way as outlined in the easement. To qualify as a farmer or rancher, more than 50% of your gross income should be from the business or trade of farming. These are a few activities that qualify as farming:

  • Raising or harvesting any horticultural or agricultural commodity.
  • Cultivating the soil.
  • Drying, handling, grading, packing, or storing a horticultural or agricultural commodity in its unmanufactured state.
  • Planting, caring, cultivating, and cutting down trees for the market.

You can place a restriction in the conservation easement stating the land is “available for agriculture.” If you qualify as a farmer or rancher, you should be able to receive tax deductions of up to 100% in exchange for the conservation easement.

Conservation Easements are Financially Beneficial

You have options even if your income doesn’t justify tax benefits. If your land has a high conservation value, the land needs to pay you for the conservation easement. Land trusts may purchase development rights through grants and donations since there is a great benefit to the public if development is prevented. Even if you do not get a tax deduction or credit, you can still get cash for the land.

Conservation Easement Need to be Accurate

You need to file forms for documenting the transaction if you want to claim tax benefits on both state and federal levels. You will need to provide IRS Form 8283 along with an appraisal if the deduction is more than $500,000.

You need to have a defensible appraisal since agencies pay close attention. You will need to pay for the property appraisal while actively avoiding overstating the conservation easement.

Get a Comprehensive Case Evaluation from Our Seasoned Land Use Law Attorneys

Speak to the experienced real estate and land use attorneys at Peterson, Martin & Reynolds LLP to discuss the details of your conservation easements, possible consequences, and the available legal options to protect yourself from losses. To schedule your initial consultation, call us at (415) 399-2900 or fill out this online contact form.

How Commercial Tenants Should Protect Themselves When Leasing a Property

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For brick-and-mortar businesses, the commercial space they rent is not only one of the key components in their operational costs, but it also plays an important role in the success of their business. Several commercial landlords and tenants in California get into disputes over issues related to the condition of the property, upkeep and maintenance, and various other matters.

There are a number of things you should consider before signing a lease because every legal clause and paragraph has the potential to impact your company. This makes it important to have a consultation with a qualified real estate attorney in California, who can review the terms and conditions of the commercial property lease, make appropriate recommendations, and provide the right legal advice to protect your interests.

Review All Terms of the Lease Carefully

The overall value of the commercial real estate sector in the US is around $16 trillion as per the National Association of Real Estate Investment Trusts (NAREIT). Businesses can easily become overwhelmed when searching for a commercial property with so many options. Commercial tenants often focus on rental rates and locations when searching for a new property.

Based on this, it’s as crucial to review the lease agreement. In fact, you should get an experienced attorney to carefully review the specific details of the lease agreement. The lease is what controls your rights and interests if a dispute or problem arises. These are a few terms to pay attention to:

  • Late payments: Commercial leases should clearly mention the terms of late rent. It should specify the amount of interest and an additional charge for late payments. This gives you a clear idea of what will happen on nonpayment of rent.
  • Use clauses: These clauses will list out the things you can and cannot do with the commercial space as a tenant. It will also dictate the manner in which any disputes are to be handled if multiple tenants lease the same building. There may be a limited use clause that permits you to use the space for specific purposes till authorized capacity.
  • Assignment and subletting: Commercial tenants are typically allowed to sublet or assign space as per the terms of the lease unless the commercial lease specifies otherwise.
  • Non-Waiver provisions: This is actually a protection for the landlord to enforce any terms that they may have allowed to slide in the past. For instance, your landlord may not enforce a late payment charge if you are late on the rent the first time, but does it the second time.
  • Security deposit: California law places no restrictions on the amount of security deposit a landlord can request for a commercial space. Your attorney will negotiate with the landlord to come up with a fair amount.
  • Repairs and maintenance: Commercial landlords are not required to maintain or repair a commercial property, except as required by the lease. Tenants should negotiate the repair and maintenance clause to obligate the landlord into making repairs.
  • Insurance: These clauses dictate whether you, the landlord, or both of you are required to obtain insurance for the space, the minimum amount of insurance required, and the type of insurance needed.

Pay Attention to the Clauses on Liability Risks

Your liability risk is a key factor to investigate when evaluating a commercial lease. Commercial landlords often try to shift a large share of the risk onto their tenants. You may end up accepting a far greater liability risk if you fail to review the specific terms and clauses of the lease agreement. Common Area Maintenance (CAM) charges are an important thing to look out for.

This is also known as NNN or triple net lease. CAM charges are basically in the form of a fee paid to the landlord. It’s designed to cover the expenses of running day-to-day operations. The CAM fees are usually proportional to the total rental obligations where the common space is shared with other commercial tenants.

CAM charges can be used for paying for landscaping, trash removal from common areas, and elevator upkeep. Repairs and improvement to the commercial property is another critical provision to look out for. You should check if the landlord can pass on repair and improvement costs to your business.

You should also clarify how the expenses are charged if the costs do get passed on to you. The cost may be in the form of a lump sum payment or get amortized over several years.

Negotiate the Terms and Conditions of Your Commercial Lease

In general, commercial lease agreements can be negotiated. Based on this, there are a few take-it-or-leave-it options as well. It’s vital that you consult with a seasoned real estate attorney and have them review the lease terms. Your attorney will give you specific advice on the meaning and implications of the different terms and clauses.

You may be able to talk your landlord into certain amendments that reduce your overall risk. Your attorney will help you decide on a lease agreement that offers a fair rental rate and ensures that your business is protected from unreasonable liability risks.

Get Legal Representation from Skilled Real Estate Attorneys in California

The seasoned real estate attorneys at Peterson, Martin & Reynolds LLP have the legal experience and skills to draft, review, and negotiate commercial lease agreements. If you are renting a commercial property and have questions about the lease, our informed attorneys are here to help. To set up a consultationwith us today, call us at (415) 849-2564 or write to us online.

 

Do Easements Transfer with The Sale of Property in California?

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Easements provide an individual or entity to use a portion of private property for a specific purpose. These non-possessory rights are typically mentioned in the property deed but could be missed out in certain situations. Easements that are not specified in a property deed usually come to an end when the property is sold, the grantor passes away, or an expiration date has been reached.

It’s crucial that you speak with a reliable real estate attorney in California because there might be unique circumstances that keep the easements active even when the property is sold.

Effect of Sale on Different Types of Easements in California

The basic framework for easements in California Civil Code is detailed between sections 801 – 813. The framework provides an overall look at easement guidelines that landowners and city officials are required to adhere to. This is how different types of easements are treated when a property is sold in California.

  1. Express Easements

Express easements are the most common type of easement in California. These can be obtained by both individuals and entities via a reservation or grant. Express easements when granted give another entity or individual the right to use a portion of the land for right-of-way purposes.

Express easements when reserved, refer to an easement that has been transferred with the property on sale of the land from one individual to another. The original owner in this situation reserves the easement for the benefit of the individual or entity.

  1. Implied Easement by Existing Use

Implied easement by existing use is a different type of easement in which the law states that there is a previously implied easement between two parties. This is even when there is no record of a written agreement. The individual or entity that believes that they are able to use a part of the property as an easement will need to show that they were earlier able to use the property for a specific purpose.

  1. Easement by Necessity

This type of easement occurs when the specific use of land is absolutely necessary. This type of easement doesn’t need any pre-existing easements on the land. Any easement on the land will automatically get transferred when the property is sold. Easement by necessity is usually provided when someone’s property is landlocked and the only way through is by using a portion of another’s property.

  1. Prescriptive Easement

A prescriptive easement is a type of easement that is granted to an individual or entity after they continue to use a portion of another’s land for a certain period of time. A prescriptive easement may still be granted if the use of land was not permitted by the owner.

Building on a Property with Easement

Utility easements are the most common type of easements on California property. Many property owners believe that they won’t be allowed to build on a property if it has a utility easement. This is not entirely true. You can do a lot of different things with your property as long as you don’t interfere with the ability to use and access the area for water, sewer, gas lines, or any other utility purpose.

If you have an easement in gross on your property, the individual can use it as a right of way, for burial purposes, for the right to pasture, and for fishing among other things. You can always build something simple on an easement, such as a fence. Moreover, you need to remember that the fence can always be taken down to use the easement. The utility company will do everything possible to repair the fence as best as they can.

Many property owners also build hot tubs and pools on easements. Above-ground pools can be easily removed when the easement has to be used. You should refrain from planting trees and other large vegetation. Based on this, you can always have a flower bed or shrubs.

Terminating Easements on a Property

Easements are typically designed to continue for an indefinite period. In relation to this, there are several ways for a property owner to terminate easements. This includes:

  • Express agreement: You can get into an agreement with the easement holder to terminate the easement.
  • Abandonment: In this, the easement holder takes action that stops them from using the easement.
  • Merger: Dominant estate owner can obtain the title to the servient estate.
  • Ending by necessity: This occurs when the easement is no longer deemed to be necessary.

It’s fundamental to understand that abandonment needs to be permanent. Not using the easement for a short period of time doesn’t refer to abandonment. There are several other nuances that come into play making it important to retain the services of a skilled real estate attorney.

Our Trusted Real Estate Lawyers Can Provide You with Strong Legal Advice and Support. Call Now.

At Peterson, Martin & Reynolds LLP, we pay attention to our clients and pursue their interests with a steadfast commitment and sharp focus. Our seasoned attorneys have an in-depth understanding of California’s real estate laws and will carefully evaluate your issues and concerns to provide you with the right legal advice. To book your consultation with our team, call us at (415) 849-2564 or reach us online.

Disclosure Requirements of California Real Estate Brokers

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Real estate agents in California are required to disclose certain information before transferring property. If the real estate broker fails to disclose what is required by law, they can be held liable for actual damages suffered by the buyer. You should consult with an experienced real estate attorney in California if you are unsure of disclosure requirements or have suffered damages because of a lack of disclosure.

Necessary Information to be Disclosed by a Broker in California

Real estate professionals representing sellers are required to ascertain any known defects or hazards on the property. They should also find out about other factors that may affect the sale. These need to be disclosed to the buyer’s representative to determine whether they are still interested in holding negotiations.

Arguably, the duty to disclose known defects and hazards on a property is the most critical one. This information generally affects the buyer’s ultimate offer and the view of the sale. Federal law requires sellers to disclose if the house has lead-based paint or was built before 1978.

These are a few other material defects that real estate brokers in California are required to disclose:

  • Foundation issues and other structural defects
  • Presence of mold
  • Plumbing problems
  • Flood zone
  • Pest or termite issues

Real estate brokers have a fiduciary duty to disclose other pertinent information to both the seller and buyer. This includes factors that may affect the negotiations, sale value, and moving forward. Other aspects that warrant full disclosure include:

  • Offers from potential buyers
  • Seller’s urgency to sell the property
  • Whether either party will move on the offer or price
  • Property value estimate
  • Conflicts of interest

Sale Disclosures by Real Estate Professionals

Real estate professionals are also required to disclose all known hazards and defects on a property. The seller needs to be truthful and their agent should ensure that all known defects and hazards are disclosed to potential buyers.

It’s important to understand that California law doesn’t subject unknown defects to full disclosure requirements. These are the defects that the owner and the broker were unaware of.

However, this situation may warrant liability for non-disclosure if the owner and real estate agent missed something they should have caught had they performed due diligence. It is best to complete an appropriate investigation and disclose any suspected issues. The disclosures made should be in writing to protect everyone involved in case of a dispute.

Potential Damages if a Real Estate Broker Fails to Meet Disclosure Requirements

The buyer or seller may have grounds for filing a lawsuit to recover damages if the real estate broker fails to make full disclosure. This may include:

  • Economic damages: This could include lost money or profits from repairs.
  • Noneconomic damages: These damages are in the form of pain and suffering and usually result from a breach of fiduciary duty.
  • Punitive damages: Such damages are generally available only for serious nondisclosures. They are meant to punish egregious behavior that severely affects the buyer’s health.

It’s crucial that you have all aspects of the sale in writing in case the broker fails to fully disclose the hazards and defects in a particular property. Make sure you consult with an experienced real estate attorney.

You should provide the attorney will all documents and records regarding the dealings. Conversations regarding offers and home disclosure forms are a few essential documents.

Important Real Estate Seller Disclosures You Should Be Aware of in California

These are a few common disclosures that you should be aware of, regardless of whether you are on the seller’s side or the buyer’s:

  • Death: There are superstitions and concerns associated with purchasing a house or a property in which someone has died. Brokers should make adequate disclosures regarding this. Sellers should also disclose any deaths related to violent crimes or because of the property’s condition.
  • Neighborhood Nuisances: Odor or noise from outside the property could cause irritation to the property occupants. Brokers are required to disclose odors, smoke, noises, and other nuisances from industrial, commercial, or military sources that may affect the property occupants. The broker may also require the disclosure of nearby farm operations, landfills, shooting ranges, airports, and other similar nuisances.
  • Hazards: Real estate brokers are required to disclose certain information to the buyer regarding the increased risk of damage from environmental contamination and natural disaster. California requires the disclosure of the presence of toxic or hazardous waste, radon gas, asbestos, and lead-based paint.

These are just a few common examples of defects, hazards, and other factors that a real estate broker or agent may need to disclose during a sale. Speak with an attorney if you think you suffered damages because of non-disclosure.

Our Seasoned California Real Estate Lawyers Can Provide You with Strong Legal Representation

The experienced attorneys at Peterson, Martin & Reynolds LLP can help ensure that all laws are followed regarding disclosure and other aspects if you haven’t yet completed a sale. Our attorneys can also help you file a lawsuit and represent your interests in court if there is an ongoing disclosure dispute.

The law firm of Peterson, Martin & Reynolds takes real estate litigation very seriously and strongly believes in providing every client with dedicated representation. We are happy to provide you with a comprehensive case evaluation. Call us at (415) 849-2564 or reach us online.

What Is Just Compensation in An Eminent Domain Case?

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In California, eminent domain gives public authorities the power to take privately held property, even where the owner of the property doesn’t want to sell. The Fifth Amendment has made it mandatory for eminent domain to be employed only for “public use,” such as for bridges, roads, schools, and hospitals among others. The government is required to pay the property owner “just compensation.”

It will take an experienced real estate attorney to evaluate the circumstances surrounding your case and ensure you are getting just compensation.

Just Compensation in California

Just compensation in a situation where there is the total taking of the property is simply the present value of the entire property. In a partial taking scenario, just compensation can be calculated as the difference between the property value before the taking and after the taking.

This means the difference between the before and after the value of a property. This difference is the total amount of just compensation due.

The standard for determining just compensation is to basically place the property owner in the exact same economic position as they would have been if the government had not taken the property. This generally involves a battle of expert appraisers for determining the best use of the property. There may be a disagreement between the property owner and these experts regarding the taking value.

The court will ultimately decide the value at trial after extensive pre-trial procedures if common ground cannot be attained by the court. This will include ascertaining a mandatory settlement offer from the taking authority, which the property owner will need to accept.

The typical issue in an eminent domain case is the infringement on an owner’s right to obtain just compensation for the property being possessed. The State and Federal law of eminent domain allow the court to calculate just compensation for taking real property wherever the owner of the property contests the compensation amount.

Factors Involved in Calculating Just Compensation in California

Fair Market Value of Land

This is the price the property owner will receive if they were willing and not forced to sell the land. This can be used for determining the fair market value of the land. For instance, the sale price the landowner will receive if they were to auction their property can be considered as fair market value.

Fair Market Value of Land Improvement

Land improvement refers to those structures, which enhance the value of the seized land. This can be barns, detached dwellings, and separate garages. Intangible land improvements need to be taken into consideration as well. For instance, land near a scenic area or one with natural resources can be considered a land improvement.

Residual Damage

This is a relevant factor in partial land takings. Just compensation needs to include the fair market value of the part being seized along with any decrease in the sale value of the remaining land. It’s also vital to consider whether the residual property can still be put to its best and highest use. There are several factors that can damage the value of the remaining property.

Other Damages

These are ancillary damages that are again related to partial taking. These ancillary damages include the costs associated with replacing utilities servicing structures on the remaining land. For instance, if the property seizure removed a buried oil tank that serviced a dwelling, the property owner will need to pay the costs of installing a new one. Such costs should be factored in determining just compensation.

Benefits

It is important to understand that the government can also deduct the value of any enhancements made by the condemnation to the remaining property. This deduction will be made in the form of a benefit from the total eminent domain payment made.

Methods of Eminent Domain Property Valuation

These are the three commonly used methods of valuing a property during eminent domain:

Market Approach

The seized property is compared to the sale value of a property recently sold with similar characteristics. This type of valuation is usually used for appraising residential properties.

Income Approach

This is best used for properties that generate income. The operating income of the property needs to be determined first. Capitalization rate and income are then used to arrive at the value.

Cost Approach

This approach considers a very specific and unique structure of the property that the owner will need on any future property. In such an approach, the cost of replacing the new structure minus any depreciation on the structure is added to the value of the empty land.

You should understand that the government’s offer is not always “just compensation”. You don’t need to accept the offer only because you receive a Notice of Condemnation supported by a written appraisal. You have important rights under California law to ensure you are fairly compensated for your property.

Choose an Experienced Real Estate Lawyer to Pursue a Viable Legal Strategy

The seasoned attorneys at Peterson, Martin & Reynolds LLP have experience with public agencies looking to use eminent domain to seize property without paying fair compensation. Our attorneys work hard to ensure that our client’s rights are protected and that they obtain just compensation. To request your comprehensive consultation, call us at (415) 849-2564 or complete this online form.

What Are the Landlord’s Remedies When a Tenant Breaches a Commercial Lease?

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In California, commercial tenants generally have several additional obligations that go beyond paying the monthly rent. This may appear to benefit landlords, but it can also mean significant losses in case the tenant decides to default on the lease. An experienced northern California real estate attorney will be able to explain the available legal remedies for recovering damages if your tenant defaults on the terms mentioned within the commercial lease.

Type of Commercial Lease Breach

The first step a landlord should take when a tenant breaks the commercial lease is to determine the type of default or breach that has occurred under the law. A seasoned real estate attorney can provide the right legal advice in this matter.

There are different remedies available depending on the nature of the default. Breach of commercial lease usually falls into two categories:

  • Monetary default: This is where the tenant fails to fulfill contractual obligations, such as rent or utility payments.
  • Nonmonetary default: This is where another contractual obligation is breached, such as failure to have proper insurance, damaging the property, or using the property for unintended or non-permitted use.

You should note the terms of your particular lease agreement since many of these allow you to convert non-monetary lease agreements to monetary in nature. For instance, if you agree to repair the damage caused by non-monetary defaults, you can add the cost to your tenant’s rent. It can be harder to enforce remedies to nonmonetary defaults as compared to monetary ones.

Remedies Available to Commercial Landlords in California

Landlords can take further action if a commercial tenant fails to remedy the breach within a reasonable or applicable notice period. The primary decision that needs to be taken by a landlord is to whether end the lease and evict the tenant or preserve the relationship while still recovering damages.

Preserve the lease

Landlords in California have four primary remedies when they want to preserve the lease agreement:

  • Distraint: Landlords (usually with a bailiff) are allowed to enter the premises and seize goods of a value matching the outstanding monies owed. Strict rules are in place to govern distraint. You may be exposed to liability for damages if these rules are breached.
  • Damages: The tenant can be sued by the landlord for monetary damages resulting from the tenant’s default.
  • Injunction: This is a court order which forces an individual to stop doing something. The landlord may seek an injunction for stopping a tenant from using the leased premises for operating a business that is not permitted through the lease, for example.
  • Specific performance: Commercial landlords can seek an order for specific performance in certain circumstances. These force the tenant to act in a specific manner. For instance, the tenant may be required to repair damages as per the order.

Terminate the lease

You may decide to terminate the landlord-tenant relationship, in which case you have three available remedies that can be used together or separately:

  • Forfeiture: Written notices are provided by the landlord for the purpose of lease termination. This remedy is usually enforced to prevent a tenant from entering the premises.
  • Writ of possession: This court order allows the bailiff to take possession of the property on behalf of the landlord. It’s useful in situations where it is not practical to physically exclude the tenant from the premises.
  • Damages: The landlord may choose to seek damages as a result of the lease termination. This usually involves lost future rent payments. Taking this into account, the landlord also has a duty to minimize losses by finding another tenant quickly.

Claiming Monetary Damages for a Breach of Lease in California

Tenants are liable for rent owed under the lease terms if they breach a lease. This includes compensation for losses as a result of failure to perform property maintenance and other obligations. Damages for unpaid rent will include any arrearages for the time that has already passed.

Under California law, landlords are allowed to recover:

  • Unpaid rent that is already owed.
  • Difference amount from the rent of a new tenant going forward if it is less than the defaulted lease. This difference can only be collected for the remainder of the lease term.

It’s critical to understand that monetary damages are limited by the landlord’s duty to reduce damages. This duty states that a landlord is not allowed to let their rental property sit for a lease term if they could have found a new tenant.

Watch Out for Waivers

Your right to terminate a lease may be considered waived if your tenant can prove that you knew of the breach but acted as if the lease was still in effect. For instance, the tenant can argue that you have willingly accepted the breach if you continued to accept rent. This is constituted as a waiver of the breach.

Get a Trusted Real Estate Attorney on Your Side

The experienced attorneys at Peterson, Martin & Reynolds will assess various aspects of your commercial lease default to find the most effective legal strategy going forward. Our attorneys are dedicated to helping property owners that have been wronged by their tenants. To request your confidential consultation with us, call (415) 849-2564 or write to us online

What Constitutes a Breach of Fiduciary Duty in California?

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Fiduciary relationships work to ensure the highest degree of loyalty and care from one party to another. Breach of fiduciary duty can do more than violate this trust relationship – it may result in irrecoverable costs in a variety of forms.

What is a Fiduciary Relationship?

A fiduciary relationship has been defined within the California Civil Jury Instructions published in 2017 as “any relation existing between parties to a transaction wherein one of the parties is duty bound to act with the utmost good faith for the benefit of the other party.”

In essence, the fiduciary duty of a party to their beneficiary exists when the beneficiary places their complete confidence in the fiduciary’s integrity. The fiduciary is not allowed to work against the beneficiary’s interests or take advantage of them without consent or knowledge.

These are a few typical examples of individuals and organizations owing fiduciary duty:

  • Banks to their borrowers
  • Attorneys to their clients
  • Controlling shareholders to minority shareholders
  • Business partners
  • Insurer to insured
  • Corporations to their stockholders
  • Pension fund trustee to pensioner beneficiary
  • Joint venturers
  • Stockbroker to client
  • Spouse to spouse
  • Trustee to trust beneficiary
  • Trade unions to union members

Forms of Breach of Fiduciary Duty in California

A person agreeing to act as a fiduciary essentially promises to act in the best interests of the other party. Hence, a breach of fiduciary duty takes place when the fiduciary acts in a self-interested or self-serving manner. Typically, breaches of fiduciary duty take place due to deception or negligence on the fiduciary’s behalf.

These are a few common examples of a breach of fiduciary duty:

  • Acting in a manner beneficial to a competitor
  • Sharing an employer’s secrets
  • Mishandling for company funds or assets
  • Deliberately withholding important information from partners
  • Engaging in any conduct legally classified as self-dealing
  • Using the trust’s property for the fiduciary’s own benefit

Consequences of a Breach of Fiduciary Duty

It’s important to understand that a breach of fiduciary duty is not a criminal act in itself. But it can be tied to one. For instance, insider trading is not just a breach of fiduciary duty, but it is also a crime depending on the significance of the wrongdoing.

The fiduciary won’t just have to deal with the damages associated with their breach, but also the consequences of a criminal act in certain cases. This may include penalties and jail time. In California, a plaintiff can demand compensatory damages along with punitive damages.

Punitive damages are awarded in more exceptional cases. They are not meant to compensate the plaintiff, but to punish the defendant and send a message to society that this particular breach of fiduciary duty is unacceptable and will not be tolerated.

The difficulty lies in quantifying damages and actually proving that a breach exists. This is where a qualified civil litigation attorney can prove to be useful.

Elements of a Breach of Fiduciary Duty Claim

There are four primary elements that need to be demonstrated to successfully prove a breach of fiduciary duty. Plaintiffs can recover damages caused by a defendant by providing substantial evidence supporting the specific components.

Plaintiffs should be prepared to show that:

  • Fiduciary relationship existed and the principal was owed a duty by the fiduciary.
  • Fiduciary acted in a manner that breached or contradicted their expected duties.
  • Fiduciary’s actions caused the principal to suffer damages.
  • Damages incurred on the principal were a direct result of a breach of fiduciary duty.

According to California’s Code of Civil Procedure section 343, you have four years to file a breach of fiduciary duty claim. But this is not a universal statute of limitations.

Your claim may have grounds for constructive fraud, in which case the statute of limitations will be reduced to three years. This makes it crucial to contact an attorney to discuss your options and file a claim in a timely manner.

It’s important to set realistic expectations regarding the next steps whether you are a defendant or a plaintiff in a breach of fiduciary duty claim. A reputable business attorney in California will be able to explain the fine nuances of the way the law applies to your particular case. This includes reviewing arbitration agreements, options for litigation, and the possibility of settling out of court.

There may be multiple parties involved in your claim, which could make it complex. Filing a claim can be costly and may last for months. For this reason, it is in your best interests to act swiftly if you believe you were harmed by a breach of fiduciary duty.

Our Seasoned Civil Litigation Lawyers are Ready to Fight for You

The attorneys at Peterson, Martin & Reynolds have helped numerous clients attain fair compensation to cover the losses suffered through a breach of fiduciary duty. Our lawyers have extensive legal knowledge and experience successfully litigating fiduciary breach cases across a wide array of circumstances.

Schedule your comprehensive case review with our lawyers today. Call us at (415) 849-2564 or contact us online.