Legal Question in Real Estate Law in California
Seeking recourse advice for a problem encountered with my real estate agent, who helped me purchase a condominium in December 2009 for investment purposes (i.e., rental income). It�s a short sale. After the transaction was completed I found out that the CC&R�s restrict me from renting the unit (existing provisions for a certain quota-based allocation were already filled). I have since had my case reviewed by the HOA and was granted permission to rent the unit for one year under grandfathering clause. I think that my agent was negligent because she didn�t inform me of the non-rental clause. (As an aside, I later found out that she had provided me with an obsolete version of the CC&Rs;.)
At any rate, I am now being forced to sell the unit (or sell my current residence and move into the vacated unit) for what will amount to about a $30k loss. To make matters worse, I�m beginning to sense that my agent knew about her �oversight� as she is now trying to cover her potential liability.
Seeking guidance for my next steps. I feel that I wouldn�t have had any loss had she performed her due diligence correctly. That said, how much of my �future loss� is my agent�s responsible for and how can I get her to pay me for the damages? Is this case worth hiring an attorney? Time is working against me as my renter will be required to vacate the unit in 6 months.
2 Answers from Attorneys
Providing you with out of date CC&R's alone gives you a cause of action against your agent. Your future losses are recoverable because they are the consequence of the agent's malfeasace. If the agent knowingly and willfully mislead you about the property being appropriate for a rental, then you would be entitled to punitive damages as well. The starting point is to make a formal written demand on the agent and her supervising broker. If they acknowledge their responsibility, you may be able to negotiate a resolution without an attorney. If they stonewall you, however, you will probably need an attorney in order to get an appropriate result. I have over twenty years of real estate and construction litigation experience, including dozens of professional negligence cases. If you would like a no-obligation, no cost inital consultation to go over your situation, please let me know. I have facilities in Oakland and San Jose to meet with you.
I'm not quite so optimistic about your chances of prevailing against the agent, broker and their insurance company. They will probably defend rather than settle, and you could spend a substantial fraction of your potential recovery on court and deposition costs and lawyer and expert witness fees. I do agree that, based on the given facts only, you do have a case for professional negligence and breach of fiduciary duty, but the $30,000 of damages is speculative at this stage. You may win, but how much, and at what cost? Is there an attorney fee clause in your agreement with the agent?
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