BTG Files Lawsuits For Fraudulent Misrepresentations in Two Property Sales
Buying property can be a stressful process. Even more so when you realize that the property you just bought has a defect that was misrepresented or not disclosed to you prior to purchase.
Sellers of residential property are under a duty to disclose of facts materially affecting the value of the property which are not readily observable and are not known to the buyer. This duty also extends to a seller’s real estate broker, who can also be liable to a buyer on the theories of negligence and fraudulent misrepresentation.
The Business Trial Group (BTG) recently filed two separate lawsuits where a home seller or realtor failed to disclose, or affirmatively misrepresented, a material issue to the buyer.
REAL ESTATE COMPANY FAILED TO DISCLOSE LEAD-BASED PAINT PRIOR TO PROPERTY SALE
After a Florida real estate solutions company failed to disclose lead-based paint to the buyers of its residential property, BTG attorney Aaron C. Garnett filed a lawsuit on behalf of the new owners of the property.
Blue Star Home Solutions Incorporated is a premier real estate solutions company that purchases property, renovates it, and sells it. After purchasing a residential property in Winter Park, Florida, Blue Star renovated it and listed it for sale.
According to the Complaint filed on May 7, 2019, Blue Star and Plaintiffs entered into a Residential Contract for Sale and Purchase concerning the property on or around August 17, 2016. Within the Contract, Blue Star represented that it knew of no facts materially affecting the value of the property which are not readily observable and which have not been disclosed to the buyer.
However, Blue Star knew that lead-based paint existed on the property at the time it executed the Contract. In addition to the Contract, Blue Star also represented to Plaintiffs in the Property Disclosure that no lead-based paint existed on the property.
Specifically, the Property Disclosure includes the question: “Does anything exist on the Property that may be considered an environmental hazard, including, but not limited to, lead-based paint?” To which, Blue Star Home Solutions responded “No.”
It was not until after taking possession of the property that the Plaintiffs learned that lead-based paint existed on the property, and that what the real estate solutions company had represented in the Contract and Property Disclosure were not true.
HOME SELLER AND AGENT FRAUDULENTLY MISREPRESENTED STRUCTURAL ISSUES OF CONDO
BTG attorney Aaron C. Garnett also recently filed a lawsuit on behalf of the current owners of a residential unit located at the Sea Gate Club, a condominium in Longboat Key, Florida. After taking possession of the property, the Plaintiffs learned that the condo seller and real estate agent had failed to disclose a structural condition that affected the value and desirability of the property.
According to the Complaint filed on May 10, 2019, between 2008 and 2017, the former owner of the condo unit was a member of the board of directors for the Sea Gate Club Condominium Association serving as, among other things, director, vice president, and president. In his role on the condo’s board, the former owner knew that the condominium required a comprehensive building envelope restoration that would cost millions.
This comprehensive building envelope restoration would require all existing windows to be removed and replaced with impact-resistant, code-conforming windows. It would also require the existing gypsum-based plaster exterior finish to be removed and replaced with code conforming stucco. The restoration would also include repairing all spalled and delaminated concrete materials from columns and slabs, as well as installing a high-quality, high-build acrylic paint with appropriate primers and conditioners.
After learning about the comprehensive building envelope restoration, the former condo owner hired licensed real estate broker Michael Saunders & Company to sell the property. On July 27, 2016, the licensed real estate agent with Saunders & Company listed the property for sale.
Then, on or around February 14, 2018, the Plaintiffs and the former owner entered into a Residential Contract for Sale and Purchase concerning the Property.
In the Contract, the former owner represented that he knew of “no facts materially affecting the value of the Real Property which are not readily observable and which have not been disclosed to Buyer.” However, he did know of several facts materially affecting the value of the property – in particular the comprehensive building envelope restoration.
The former owner also knew that it would cost between $8 million to $9 million for the comprehensive building envelope restoration. He also knew that the $8 million to $9 million cost would be paid by the individual condo unit owners, and that he would have to pay a large assessment if he continued to own the property.
In addition to what the property owner declared in the property disclosure, the real estate agent also misrepresented the condition of the property during his meetings with the plaintiffs. The real estate agent represented that there was both no structural condition and no condition affecting the value or desirability of the property, as well as no upcoming assessment or special assessment in connection with the property.
Both the former owner and the real estate agent knew or had reason to know that the statements it made to plaintiffs were not accurate or truthful when those statements were made.
WHY YOU SHOULD HIRE BTG FOR REAL ESTATE LITIGATION
Property sellers and real estate agents must disclose a property’s known defects or structural deficiencies. These problems could cost tenants money down the line, and it is neither ethical nor legal for a seller or an agent to obscure such information.
As the nation’s largest contingency-fee law firm, the Business Trial Group is uniquely positioned to fight for our real estate clients. Our experienced attorneys charge no hourly fees, and no fees at all unless we recover money for you.
If you are a buyer who feels that a seller has failed to disclose material defects in a property you purchased, contact us via our no-fee, no-obligation form or call 888-343-8073.