Santa Monica, CA asked in Real Estate Law and Probate for California

Q: Do we have a case here?

My partners and I recently purchased land in California City from a Remax agent on behalf of her client. When we filed our building plan with the city for approval, they informed us that according to the county, the land is still in the name of the client's deceased mother. As such, the matter must be submitted for probate before the client can be authorized to sell us the land. Basically, the Remax agent did not do her homework and now our business stands to lose months of anticipated revenue because of this oversight. Do we have a case to sue the Remax agent's insurance for damages?

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2 Lawyer Answers
Gerald Barry Dorfman
Gerald Barry Dorfman
Answered
  • Probate Lawyer
  • Mill Valley, CA
  • Licensed in California

A: Your situation is very fact specific, and will require a consultation and document review in order for an attorney to properly advise you. There are factors which may weigh on both sides (or 3 sides). For example, what measure of due diligence did your partnership engage in? Is there title insurance? What written representations were made by the agent or seller? Also, much will depend on the strength of proof of the anticipated damages.

Ben F Meek III
Ben F Meek III
Answered
  • Probate Lawyer
  • Oklahoma City, OK

A: Probably not. You didn't have a contact with the realtor. You knew before the sale that the agent was acting not in his or her own right but on behalf of their principal -- the seller. Your lawsuit is probably only against the seller (absent fraud). It wasn't actually the realtor's obligation to investigate title. It was the seller's, not the agent's, obligation to convey title.

You'll have to look to the terms of your purchase and sale contract with the seller. Did the seller agree to convey marketable title free and clear of all liens and encumbrances? If not, what did they agree to convey? Did you try to purchase title insurance? (I expect not -- the title insurance company would have required that the problem be cleared up before the sale or they would not insure it. The commitment for title insurance would also have alerted you that there was a problem before the closing. A lawyer would also have discovered the problem.) Did the seller provide an abstract of title before the sale so you or your lawyer could examine it? If so, did you have a lawyer review it? If not, why not? If you didn't have a written sale contract, why not?

Real estate transactions are fraught with hundreds of problems that occur commonly but are easy to avoid, and this is one example. You could have avoided this problem by using professionals to assist you -- a lawyer or a title insurance company. By looking to save a few hundred dollars, you've probably cost yourself several thousand dollars and a lot of time, to clear up the problem. There's even a chance you won't be able to clear up the problem or recover your purchase price. You'll definitely need to consult an experienced real estate lawyer at this point. Many offer free initial consultations. Good luck to you.

PS: My comments here are for general information only and are not legal advice on your specific situation nor do they create an attorney-client relationship between us. Consult with an attorney licensed in your state for legal advice on your situation.

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