Unintended Dual Agency

Saturday, 24 May 2014 by

  A dual agency may be created unintentionally, which may have severe consequences for the real estate broker and others. If the dual agency is neither disclosed to nor approved by both parties to the transaction, undisclosed dual agent cannot recover any compensation, and a principal can rescind the transaction. Unintended dual agency can occur

Perils of Dual Agency

Wednesday, 23 April 2014 by

  California real estate brokers are permitted to serve simultaneously “two masters” if the dual agency arrangement is disclosed to and approved by both parties to the transaction. Some agents will readily jump at the opportunity to make a larger commission, even though the extra compensation comes with conflict of interests and risks. Some buyers, to gain a competitive

  Buyer submits an all cash offer at the full listing price of $17 million. Seller indicates that the terms of the buyer’s offer are acceptable and counters only to increase the price to $19.5 million. The parties’ deal does not go past this stage. Buyer’s broker then sues seller for his 2% commission since the broker had produced

Impact of CAM Estimates in LOIs

Sunday, 23 February 2014 by

  Letters of intent routinely include estimates of the amount of anticipated common area expenses (CAM), and most real estate professionals believe such estimates will not bind the parties later. But, in a recent case, the court ruled that the tenant could rely on these estimates despite the statement in the lease that the lease was the final

  Given the changing commercial real estate market, buyers and sellers should carefully evaluate using a liquidated damages provision for each deal. Routinely initialing such a provision, which is in most printed purchase and sale agreements, may not advance the interests of the buyer or the seller in every situation. Under the typical liquidated damages

Limits of Profit Sharing in Leases

Saturday, 14 December 2013 by

  A commercial lease can give the landlord all or any part of profits from an assignment or sublease. While such an express provision is legally valid and enforceable, there are limits on the amount the landlord can charge for granting consent to an assignment or sublease. A lease provision can require that the tenant

“Or nominee” and Its Problems

Thursday, 14 November 2013 by

  Real estate buyers and brokers routinely insert “or nominee” after the buyer’s name in purchase offers. They usually add these words because the buyer wants to have flexibility in taking title to the property, such as in a business entity that has not yet been formed, or to “flip” the property to a new

  If the seller of a property refuses to refund the buyer’s earnest money deposit after the buyer cancels the escrow, the buyer cannot rightfully tie up the property in litigation by suing for specific performance and recording a lis pendens, since the buyer has canceled the contract. Typically, the escrow holder will not release

New Energy Use Disclosure Laws

Sunday, 14 July 2013 by

  As if enough disclosures were not already legally required, new laws will require disclosure of energy benchmarking and energy usage in certain non-residential real property transactions. Generally, effective as of January 1, 2014, building owners will be required to provide EPA energy benchmark reports for the prior year when a commercial property is sold,

  Relief may be in sight for property and business owners from the rampant abuse by predatory ADA plaintiffs. As many have experienced, California law allowed a disabled person who encountered an accessibility violation to immediately sue without prior notice or opportunity to cure. These “professional” litigants typically sued for the minimum statutory damages of