Jury sides with Realtor in dispute over sales price
Couple claimed they didn't see relevant comps
By Inman News, Tuesday, April 15, 2008.Bookmarking Sites
A Carlsbad, Calif., real estate broker who showed a couple dozens of properties before they plunked down $1.2 million for a home near a golf course fulfilled his fiduciary duties to his clients and was not negligent, a jury has ruled.
RE/MAX agent Mike Little was sued by his former clients, Marty and Vern Ummel, who claimed they paid $150,000 too much for their home in northern San Diego County. The Ummels claimed Little failed to tell them about similar homes nearby that sold for less.
Little's attorney, David Bright, said the agent was unfairly blamed for the decline in value of the Ummel's house after they purchased it in July, 2005. Bright argued that homes that sold for less than the couples' had features that made them less desirable.
After a two-week trial, a jury found that Little did not breach his fiduciary duty to the Ummels, providing assistance in their three-month house hunt that included advising them on offers they made on other homes, the Voice of San Diego reported.
Bright told the paper that Realtors have become scapegoats for a declining market, and that the trial demonstrated the hard work that real estate professionals perform for their clients.
Vinnie Tracey, President of RE/MAX International, took issue with news reports that the case raised the possibility that courts might hold real estate agents for lower home values.
"This case was never about falling prices or the current real estate market," Tracey said in a statement. "It was simply about the unfounded claims of an individual home buyer, claims that could not be substantiated in any way."
The Ummels, who gained notoriety picketing RE/MAX offices and home listings, filed suit against Little and RE/MAX Associates in July, 2006. The Ummels attorney said the couple has not decided if they will appeal the decision.
Marty Ummel told the Voice of San Diego that the decision sends "a bad message to people about the real estate industry," because it demonstrated there is not the relationship of trust clients expect.
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Submitted by Jim Lee, Knoxville TN Realtor on April 15, 2008 - 4:12am.
Good grief! Picketing offices, listings, and now suing their agent. These buyers have waaayy too much time on their hands.
I know we have a big responsibility (and liability) as a buyer's agent but being responsible for the future price of someone's home is over the top and thank goodness, wrong.
Submitted by Brecht Palombo on April 15, 2008 - 4:47am.
Hooray. A win for those whack-jobs would have been horrendous not just for the industry but for society and the idea of personal responsibility
Submitted by John Davison on April 15, 2008 - 5:34am.
This is just another example of people not holding themselves accountable for their own actions. Sue the Realtor, sue McDonalds because my 6 year old is grossly obese, sue the dry cleaner for $1,000,000 because he ruined my pants and I've endured pain and suffering (incidentally the dry cleaner won that case), etc... It's the very reason why the twenty-something generation can't cope with the realities of life. We have become a society of finger-pointers, unable to shoulder responsibility for our own actions.
Little did his job, that was proven by the court's decision. I hope he enjoyed his commission check and I sincerely hope he didn;t give them a house warming gift!
Submitted by Jay Thompson on April 15, 2008 - 6:34am.
It's curious to me how it's rarely mentioned that the lender in this case was also the agent (source: http://www.voiceofsandiego.org/articles/2007/02/20/housing/939picket0212... ) and that both the lender side and the appraiser settled previously out of court.
I'm not saying (at all) that Mike Little the agent is guilty. But I do wonder if their hadn't been the combination lender/agent in this scenario if it would have even made it to court. There's an inherent conflict of interest and certainly increased liability for the agent who also serves as the mortgage broker in the same transaction.
When I saw the Ummels on the Today Show (http://www.phoenixrealestateguy.com/home-buyer-suing-agent-ummel-v-littl... )I felt they didn't have much of a case. Given that it took the jury less than two hours to reach a unanimous decision, apparently they felt the same way.
Jay Thompson
Broker / Owner
Thompson's Realty
Blog: www.PhoenixRealEstateGuy.com
.
Submitted by Sherry Huffman on April 15, 2008 - 8:35am.
As an Agent, the last thing I want to do is get
involved in my Client's loan. Other than Dual Agency, I can't imagine more shark infested waters. If anything goes wrong, the Client's thoughts are naturally going to drift to "conflict of interest". With all the liability we deal with, why even go there?
Sherry Huffman
Realty Executives
Prescott, AZ
Submitted by Layne Kulwin on April 15, 2008 - 10:06am.
What is becoming a common practice is "suing the agent" for just about anything and hoping that the broker, salesperson, lender, inspector - whomever - will settle out of court for a modest, but tidy sum. It's moved from an ethical or legal issue to a bottom-line what's it going to cost me to defend myself in court. Granted, the costs of defense, depositions, expert witnesses, etc. can overwhelm you... often it is the bottom line that prevails at the end of the day.
How sad.
Submitted by coji burned on April 15, 2008 - 12:31pm.
By definition a real estate agent is a bottom feeder. That would be an opportunist who profits from the misfortunes of others. This is sad but true.
Fortunately, the real estate profession is being restructured as we speak. Thanks to the internet the role of the traditional real estate agent will be no more.
A home buyer will be able to get all the needed information from the click of a mouse, and will no longer have to pay that wasted commission!
Submitted by Joe Cline on April 15, 2008 - 3:11pm.
I think the Ummels have just learned to use the internet! :)
I just hope that the judge awarded the broker fees and costs.
Joe
Camelot Real Estate | Austin Lofts
Submitted by Michael Love on April 15, 2008 - 6:26pm.
After , from what I understand looking at dozens of properties, being quoted many prices i would think evena dumb buyer would havew lganed some knowledge of what vatious properties were being sold for and what they could get for their money. Obviously they evaluated them all and decided the one they bought was the best buy. I was once told by a broker the houses on the market at that time were not worth what the seller was asking. Iasked him why he felt that way and he proceeded to tell me he had sold the property 5 years ago for half of what the presnt seller was asking. My uneducated answer is the property is worth what the last buyer was willing to pay for it.
Submitted by Roland Barcos on April 15, 2008 - 8:39pm.
These people believe they need to be compensated for a perceived loss in a down market, so I wonder if they would reward agents for any appreciation that an up market would provide. Since, in my area, most down markets are brief and less than 10% in value, and up markets last 3 to 5 years with gains of 50 to 100%, I kind of like that idea.
Submitted by Paula Bean on April 16, 2008 - 6:51am.
It is truly sad that we live in such a society today where people make their living off of suing others.
Whether the agent got awarded fees or not, you can never get back the loss of time you had to spend defending yourself. The Judge and Jury also wasted their time. It would be nice if a Judge could review a case and refuse to let the suit go forward based on merit and evidence.
I love Roland Barcos's comment though! If we are to be liable for the loss of value, then we should also be compensated for the appreciation of it ;-)
I am waiting for the time to come when someone sues an agent because they let them spend too much money on a house - even though that is the price range they wanted and got approved for, but they couldn't afford it and lost it to foreclosure.
Where does this madness end?
I'll bet if it weren't for E&O insurance and their willingness to 'settle out of court' to save time and money, THAT is where it would end.