real estate litigation

Most Common Causes of Real Estate Litigation

Real estate litigation and disputes are becoming increasingly frequent and commonplace in the real estate market today. Although no one who goes buying or selling a property is looking to get into a legal wrangle, things sometimes do go awry.

Whether you own a residential property, a commercial real estate, or are a part of a condominium association, or a property management company, chances are that you might find yourself embroiled a real estate litigation at some point.

The fear of a real estate dispute, and the ensuing litigation, should not necessarily intimidate you out of purchasing or selling your property. Legal disputes are an unfortunate part of the business environment, and litigation can sometimes prove to be a useful mechanism to seek reparation in the face of wrongdoings.

Sometimes, disputes arising out of real estate deals can be settled out of court, but litigation may be unavoidable when the conflicting parties cannot reach an amicable solution between themselves. Below, we will cover and review some of the most common reasons for real estate litigation and some of the steps you can take to protect yourself when faced with litigation.

  1. Deliberate Non-Disclosure of Defects

It is the duty of the seller to divulge information about any defects in the property that may not be clearly evident but may influence the property value. For a buyer to initiate litigation on the grounds of non-disclosure, they must prove that the seller had prior knowledge of the said defects, and they deliberately withheld that information.

Having said that, buyers still need to perform due diligence before finalizing the deal. It is important that they check if the property has undergone any improvements or alterations, and also if all the permits for the property are in order. The most common reason for property litigation is usually the defects or leaks in the roof.

  1. Breach of Contract

Breach of Contract is another very common reason behind real estate disputes and litigation. To finalize a real estate deal, both parties must sign a legal document containing all the terms and conditions of the sale. This agreement, or the contract, is sacrosanct in the context of the sale, and failure to honor the terms by either party constitutes a breach of contract.

You must review the contract document carefully and ensure that you are aware of all the provisions, to avoid any dispute later. Even after the completion of the sale, you need to be mindful of the entire contract, so as to not breach any of its terms and conditions.

  1. Negligence

Real estate agents are legally obliged to execute the property deal keeping their client’s best interests in mind. They must ensure that their clients are aware of all relevant information about the property, that can prove to be beneficial to them. At the same time, they need to be careful about confidentiality with regard to their client’s sensitive information.

Failure to perform, or being negligent of any of the above responsibilities could imply a breach of duty. Agents responsible for causing losses due to their negligence or misconduct could face a civil lawsuit by their clients.

  1. Boundary Disputes

Sometimes a seller may use practical property lines that do not match up with the legal property lines. In addition, a real estate holding may not have the property lines duly registered.

Both of these above situations may cause boundary disputes, subsequently precipitating litigation. You need to carefully research the legal boundaries of any real estate you are looking to buy before going ahead with the purchase.

  1. Failure to Perform Specific Obligations

A real estate contract between the two parties might require fulfillment of certain obligations by either or both of the parties. Failure to execute the required actions specified in the contract document might lead to litigation.

Since litigation can be arduous and expensive, negotiations between the two parties could avert a potential legal battle. Make an attempt to negotiate if the other party is not able to fulfill the specific obligations detailed in the agreement.

Ways to Protect Yourself When Facing Real Estate Litigation

Your first aim in a real estate deal should be to avoid any act of negligence or misconduct on your part. However, if forced into initiating litigation and drawn into a protracted legal battle due to the other party’s wrongdoing, here are a few things you need to do to protect yourself:

Keep a Record of Everything

Document everything, as it is the only way will be able to prove that there was no wrongdoing on your part.

Review All the Signed Documents 

Check and ensure that all the paperwork bears the signatures of both parties.

Make Multiple Copies

Make copies of the critical documents and store the copies and originals separately, in a safe place.

Ensure That No Documents Are Missing

Pore over and arrange all the documents in proper order, making sure that there are no missing links.

Contact a Skilled and Knowledgeable Alabama Real Estate Attorney

Whether buying or selling a property, we recommend that you hire a reputable real estate agent to represent you. Similarly, hiring an experienced and competent real estate law firm is highly advisable, if you need to bring or defend a lawsuit.

Davis, Bingham, Hudson & Buckner is a nationally recognized law firm providing professional services in real estate and transactional law in East Alabama since 1978. To understand more about how we can protect your rights, call today at (334) 821-1908 or contact us online. We provide strong real estate counsel and representation for your needs.

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *