Photo by by Brookenovak
So Sue Me, Sue Me, What Can You Do Me?
Litigation is a very popular topic this week. Russell Shaw wrote about it in his recent post “An Open Letter to Ben Behrouzi” . Inman News wrote about it discussing the same law suit of Vlad Zablotskyy , who had his own take on the situation. There was even substantial discussion about another Inman article from February 2008, discussing litigation involving a Miami Blogger.
For the first 20 years I was in business, I had no experience with litigation. But if you are in business long enough, and you do enough business, someone will try to sue you. It doesn’t matter if you are really careful or if you did everything right. Those things only mean that when you are sued, you will probably win. It doesn’t mean that you will never be sued. Litigation is a fact of life In his documentary Born Rich Jamie Johnson IV (yes the Johnson & Johnson Johnsons) talks about being sued as a rite of passage for the rich kids whose lives he chronicled, sharing his experience as one of his friends sues him for defamation of character.
Doing the Right Thing
For example, can you imagine being sued for doing what the law required you to do? Several years ago, our company listed a property which was sold by a cooperating Buyer’s Agent. There was some negotiation between the buyer and seller, and eventually an agreement was reached on price, with a financial concession from the seller was acceptable to the buyer. After settlement, we were sued by the buyer, who claimed that we had forced him to pay too much for the property. According to the complaint, the buyer allegedly had a conversation with the seller immediately after closing where the seller allegedly “Why did you pay so much for our house? We would have sold it for less.”
When the case came to court, the Seller (our client), stated that this conversation never took place. Further, the Seller stated that they would nothave sold the property for any less then the agreed upon sale price. It was also evident that no one from our company ever spoke to the buyer directly prior to closing, and that we never negotiated with them directly. And of course there is one small fact that we presented for the judge’s consideration, even if the facts as presented by the buyer were true, all we had done was to obtain the highest price and best terms possible for our client, an responsibility of ours under Pennsylvania law as well as being our contractual obligation. Needless to say , we won, but not until we had appeared in court several times, and been very thankful that we had E&O insurance.
A Higher Authority
Then there was the time I felt like a Hebrew National Hot Dog. We had a tenant who left a property that he had rented for several years. In Pennsylvania the landlord is not obligated to send the tenant back their security deposit unless he or she are provided with the tenant’s new address in writing. This tenant had not provided us with a forwarding address, we are very careful, we sent regular and certified mail to the former address hoping that the mail would be forwarded or that he would be notified somehow of the inspection of the property. The mail was returned unopened and we had no idea where the tenant was until he sued us for treble damages.
We went to court and I explained to the judge that I could not have returned any money to him because he had failed to provide us with an address. I then showed her the returned mail, mentioning that we had gone well beyond the requirements of our laws. The Judge then said to me, “I understand what the law says Mr. Lublin, but since you are a professional you are being held to a higher authority”. I was stunned. I appealed the case, and an equally stunned apellate judge reversed the decision immediately, but I was still a upset that I had been sued.
The final chapter of this story came about 60 days later when a sheriff from a neighboring county appeared at our rental office asking for the former tenant’s address. It seemed that they had been looking for him for several years, on a murder charge, but had been unable to find him. Of course, when he sued us, he had provided his current address, which I was pleased to share with these officers. And so justice was found in the courts after all…
You Can’t Always Duck
There are more stupid law suits that I’ll share at some later date, but after they were done, we were still standing. And each time there was a lesson to be learned, and sometimes even an improvement to be made.
In the final analysis, I’m not sure that any one can be assured that they will never be involved in stupid litigation. Anyone can sue anyone over anything. It doesn’t mean they’re going to win. But being involved in a law suit isn’t the worst thing in the world. As long as you have done the proper thing, documented your actions, and are confident in your position, going to court is an experience like any other. Use it to make yourself better at your job. I can tell you that not being scared of the process and being resolute about your position are important to your success if you are sued. A snarling attorney once leaned over a conference table at me and yelled, “I’m an attorney! Do you know what that means?” To which I replied calmly, “Yes, of course I do, I hire guys like you!”
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Bill, love the title, graphic and the article!
Bill-
I want a drive thru lawyer
Perhaps you folks could come up with a “common” disclaimer that we could use and adopt… Sorta like, you know, open source it….
Jim
In real estate … It’s not IF you’ll get sued … it’s WHEN.
@ Russell – Thank yo kind sir – and I like you’re outfit today also!
@Jason You have to be careful to get fries with that lawyer
@ Jim Gatos Here’s my disclaimer – “I don;t ever intend to do anything wrong – and if you think I did, you’re mistaken. Please leave me alone. Thanks for playing.” ;-D
@Mairiana – I see you got the point!
Law suit happy people will find something to sue about, no matter what. It’s like there is no real protection from it. Frustarting and expensive…there ought to be a law!!
@Monika – So I have this dream where if you can show that the law suit was stupid – the opposing lawyer has to pay you – and then you get to thro a cream pie at him
Was a ‘hired gun’ several years ago for agents being sued re: investment properties. Several cases, some fun, and some judges who seemed to make it up as they went. It’s one of my A-List reasons for my perpetual smile, as we’ve not had to do business in CA for nearly five years.
Alas, we’re crankin’ up again.
Bill,
I am on my board’s grievance committee, and I can say that we see some legitimate complaints come across our desks. That said, I think most of us fear the kinds of suits you have been involved in. It is nice to prevail, but living through it can’t be fun.
Maureen
@Bawldguy – If they allow pocorn in the courts in SoCal I would have paid money to watch you in court- Isn’t it fun to watch the soap opera stuff? I’m sure you were a hoot and a holler when they threw something stupid at you – for you to catch and toss back at their heads like a fastball!
@Maureen; I can relate to what you see – I love Grievance and Pro Standards – (I’m this years Chairman for NAR) and I think that people fear the experience like they fear the Pro Standards Experience, but when you’ve been through it, you gain a level of comfort in the process. I’ve had people threaten to sue me, only to have someone in our local courts say”You don’t understand – This guy isn’t intimidated by you or the court. He actually seems to enjoy this stuff” and Sometimes the silly potential litigation goes away.
In fact, today at 1 PM I go to court for a small lawsuit where a neighbor is suing my partner and me for water that had allegedly come from a leaky pipe in our basement – except there was no water service to our house at the time! Just another day in the life
Bill – Thanks for sharing this – for those of us who have “yet” to be sued, your wisdom is valuable. I also believe there is something to be learned from every transaction, and I assume, every litigation, which only makes us better.
Absolutely correct that you can get sued by anyone, for any (or even No) reason. The biggest issue for me with them isn’t really wondering if you are going to win or lose (if you’ve done the right things, you can be fairly comfortable for the end result), its the time sink & hassle that you have to waste hours messing with the thing in the first place.
I spent waaayyy more time in court rooms – as a court reporter – than anyone should ever have to. I nevvver want to see the inside of one ever again. Just watching the pain on people’s faces was enough for me.
I love the idiot judge saying you should be held to a “higher authority” than the actual law. I’ve faced the same thing in court with a tenant. I believe the judge told me, “I know what the law says, sonny. But let me tell you how we’re going to do it today in *MY* courtroom.”
The ego that seems to come along with being a judge is rivaled only by pilots, doctors and Section 8 inspectors.
…jp
You will never know how much I needed to read this right now. As you know, I am going thru a difficult time after filing an ethics complaint against a fellow agent and their Broker. This blog post has put this process into perspective for me. It has given me the strength to continue to do the right thing and press forward with my complaint. And if this Broker carries out his threat of suing me over my complaint, I will walk into court (with my attorney) with my head held high and know that I have done nothing wrong. I need to believe in the system and I need to believe in myself. Thanks Bill! You always know what to say to make things better!
We are home sellers being sued by the young buyer who apparently feels “entitled” to perfection in a 43 year old home. My husband re-did everything in that house and they just “LOVED IT”, but we bent over backwards to help them buy it, paid all closing, paid home warranty and $7500 to re-do entirely the bath that they didn’t like. NOW after closing and having their inspector in the house countless times before closing we’re being sued, for plumbing issues that should have been readily viewable above a drop ceiling. WHAT happened to at closing the house is yours???? This is in North Carolina.
Susan – It’s unfortunate that anybody can sue for anything. It’s even more unfortunate that sometimes no matter what you do it isn’t good enough.
Lawsuits are extremely stressful so be good to each other during this process.
thanks Vicki. Yes, our agent was so sure that closing was the end of the nightmare and we convinced my husband to sign. We are really working hard to not fight over this situation. Thanks for the note!