Most Common Causes of Real Estate Litigation
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.
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.
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.
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.
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 free consultation, call us at (415) 399-2900 or complete this online form.