If you are buying or selling real property, chances are you are working with a real estate agent. A real estate agent is a person who is licensed to sell and rent out real property for clients. The real estate professional must be educated in real estate matters and pass a state board licensing exam that varies from state to state. A real estate agent is often used interchangeably with salespeople and brokers. Nevertheless, they technically refer to real estate salespeople. As a salesperson, they pass a less rigorous exam than brokers and must work with a brokerage as opposed to a broker who can work alone.

Common Lawsuits Against Real Estate Agents

Since real estate agents deal with the sale and purchase of real property, they are particularly vulnerable to lawsuits. Below are a number of common lawsuits against real estate agents.

  • Failing to Disclose a Property Defect – Real estate agents have a duty to disclose anything that materially affects the property. Something materially affects a property if it impacts the value or desirability of the home. Defects can include construction issues, improvements without permits, leaks, cracking, noise or nuisances. Even if the real estate agent did not personally know about the defect, they can still be sued if they represent a party who knew the defect existed.
  • Breach of Duty – The most common type of lawsuit brought against real estate agents are for breach of duty. If an agent does not act in the best interest of her client, she can be sued. For example, if an agent receives 5 offers on a home sale ranging in price, but lies and tells the client she only received one for the cheapest amount, she can be sued for breach of duty.
  • Giving Legal Advice – Real estate agents have general knowledge about real estate transactions and may even have a peripheral understanding of real estate law in the state where they reside, but they are not authorized to give legal advice. Many agents don’t understand this and give unsolicited legal advice to the detriment of their client.
  • Breach of contract – Real estate agents who did not perform under the terms of the contract can be sued for breach of contract. One of the most common breach of contract claims is for failing to comply within the time-frame stated in the contract. Breach of contract claims are often filed with claims of negligence, breach of duty and fraud.
  • Negligence – Agents can be sued for negligence if they fail to exercise due care toward others that a reasonable or prudent person would do under the same or similar circumstances. Clients often make claims that real estate agents knew or should have known something but failed to take the right action.
  • Personal injury – If someone is injured during a showing (slipping and falling on the newly washed floor, falling through non-code compliant stairs, etc.), they can file suit against a real estate agent.
  • Fraud – If a real estate agent intentionally uses false information or makes false representations about the condition of the property in order to gain an advantage during a real estate transaction, they can be sued.

Legal Remedies in a Real Estate Lawsuit

In the majority of real estate lawsuits, a court of law will award monetary damages to a plaintiff who has been wronged by a real estate agent. The monetary award can include lost finances like down payments, filing fees, and other costs.

Should I Hire a Lawyer?

If you have been wronged by a real estate agent, hiring a real estate attorney can help you navigate through the complex legal issues and achieve a favorable result. Moreover, hiring a real estate attorney at the beginning of a transaction can help prevent conflicts during negotiations and closing.