Legal Updates

CALIFORNIA SUPREME COURT RULES THAT DUAL AGENCY CREATES DOUBLE FIDUCIARY DUTY FOR AGENTS

November 28th, 2016

The California Supreme Court ruled that both sales agents working for the same broker in a dual agency transaction owe fiduciary duties to both the buyer and seller. This means the listing agent in a dual agency transaction has a fiduciary responsibility to inform and advise the buyer, someone whom the listing agent has probably never met and with whom he/she traditionally does not communicate directly. Conversely, the buyer’s agent has the same fiduciary responsibility to inform and advise the seller.

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WHEN A BROKER IS THE DUAL AGENT OF BOTH THE BUYER AND THE SELLER IN A REAL PROPERTY TRANSACTION, THE SALESPERSONS ACTING UNDER THE BROKER HAVE THE SAME FIDUCIARY DUTY TO THE BUYER AND THE SELLER AS THE BROKER.

May 29th, 2014

In a dual agency transaction, where the buyer and seller were represented by sales agents working under the same broker, the listing agent owed a fiduciary duty to the buyer and could be held liable for failing to advise the buyer to verify the accuracy of conflicting information on the square footage of the property. Horiike v. Coldwell Banker Residential Brokerage Co., 169 Cal.Rptr.3d 891 (2014)

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A LISTING AGENT IS NOT LIABLE TO THE BUYER FOR MAKING A STATEMENT OF FACT REGARDING THE PROPERTY THAT IS ACCURATE BUT OUTDATED. THE SELLING AGENT IS LIABLE FOR FAILING TO EXPLAIN IT.

April 21st, 2014

The buyer of an undeveloped parcel of real estate sued the seller, listing agent and listing broker when he discovered that the property he purchased was unbuildable even though the MLS description written by the listing agent stated a geologist report concluded it was buildable.  The listing agent failed to disclose in the MLS that the geologist report was 25 years old and outdated.  The court ruled that the seller and listing agent were not liable because the MLS statement was factually accurate.  However the selling agent was found liable because he failed to review the report and failed to inform his buyer the report was unreliable.Saffie v. Schmeling (2014) 224 Cal.App.4th 563

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LISTING AGENTS MAY BE LIABLE FOR INJURIES TO PERSONS VISITING THE MARKETED PROPERTY

May 13th, 2013

While showing a home to her clients, a real estate agent climbed up the stairway ladder to the attic.  Unfortunately, one of the hinges broke and left the agent injured on the floor. The agent sued the owner and the listing agent.  The court ruled the owner and listing agent could be held liable for failure to notify visitors of concealed dangerous conditions in the property being marketed.  Hall v. Aurora Loan Services LLC 155 Cal.Rptr.3d 739 (2013).

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COURT CONFIRMS $100,000 JUDGMENT AGAINST PROPERTY OWNER WHO CUT DOWN A TREE STRADDLING THE PROPERTY LINE WITH HIS NEIGHBOR

October 12th, 2012

A property owner cut down a mature 70 feet tall Aleppo pine tree whose trunk was located partly on his property and partly on the neighbor’s property.   He cut down the tree thinking the tree was his and that it presented a safety hazard.  When sued by the neighbor, the trial court awarded double damages in excess of $100,000 and the appellate court affirmed.   Kallis v. Sones (2012) 146 Cal.Rptr.3d 419.

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IF A SURVEY CAN ACCURATELY LOCATE THE BOUNDARY LINE BETWEEN TWO PROPERTIES, THEN AN ENCROACHING FENCE CANNOT ESTABLISH A DIFFERENT BOUNDARY BY AGREEMENT

September 27th, 2012

The California Court of Appeal recently held that a long standing encroaching fence does not establish the new property line between two parcels despite the agreement of the adjacent owners, if a survey can accurately determine the true property line.   Martin v. Van Bergen (2012) 146 Cal.Rptr.3d 667.

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AFTER JANUARY 1, 2013, HOMEOWNERS WHO REFINANCE PURCHASE MONEY LOANS AND THEN DEFAULT, WILL RETAIN ANTI-DEFICIENCY PROTECTION FOLLOWING FORECLOSURE

September 17th, 2012

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CALIFORNIA HOMEOWNER BILL OF RIGHTS BECOMES LAW JANUARY 1, 2013

July 30th, 2012

In July 2012, the California legislature passed into law, the Homeowner Bill of Rights (SB 900) to help struggling homeowners by providing safeguards in the loan modification, short sale and foreclosure processes.

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RESPA DOES NOT PROHIBIT UNEARNED FEES CHARGED BY A SINGLE SETTLEMENT SERVICE PROVIDER

June 4th, 2012

The Supreme Court of the United States held that a lender who charges consumers an unearned fee does NOT violate RESPA §2607(b), unless the fee was given and accepted between two or more persons.  It does not bar unearned fees charged by a single service provider.  Freeman v. Quicken Loans, 566 U.S.(2012)

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HOMEOWNER WHO LOST HOME IN FORECLOSURE CAN SUE TO SET ASIDE TRUSTEE SALE IF LOAN WAS PREDATORY

February 15th, 2012

The 6th District Court of Appeals in California opened the door for a homeowner to sue their lender and possibly recover their home after foreclosure, if the borrower can prove that the circumstances and terms of the underlying loan were egregious, oppressive and predatory.  Lona v. Citibank 202 CA4th 89 (2011).

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