Posted by Bill Gatten on March 13, 1999 at 14:11:10:
JPiper,
You’re obviously thinking about the word “amorphous” denoting the lack or absence of change(a common and quite logical error). The word I was using (“amormorphous”) means, the love (amor) of change (morph) in the shorts or drawers (hous[en] as in “leiderho[u]sen”). OK? (Sheeze!)
I’m calling my New dictionary, “Gatten Under the Bridge with Dick and Harry.” or Gatten’s Unerbridgedickn’ary… or something like that. And amormorphous will be the first word (except maybe for Aardvaark or aaabersnain or something)!
A freind and partner of mine sold a property (SFH) to a family a couple of years ago. The Buyers REFUSED to have a home inspection at the time of buying the home. After about 6 mos., the sewer system failed (septic tank/ drainfield system). The owners are now suing my friend for ACTUAL as well as PUNITIVE damages due to his negligence by selling the property with a defective system. The amazing part of this is that the Judge is holding my friend AND the Realtor liable for the new owner’s continuing to pollute the neighbor’s property (they have done nothing to correct the situation in over two years).
Is there anyone with any advice in how to handle this situation? It seems totally unreasonable that this person can refuse to have the home inspected and then sue when something turns out to be wrong. This has me EXTREMELY concerned for my own wellbeing in the CRE arena.
The papers came in today on the lawsuit. Get this - the people paid $51,500 for the house and 6 acres. They are suing for over $176,500!! Can you believe this? I agree with the post about LLC’s and Trusts. We ALL need to do what it takes to protect ourselves from lunacy such as this.
The judge stated in the prelim “Someone is goint to pay for a sewer system for these people”. What happened to fair and impartial?? Sounds like his mind is made up before the trial. My friend’s attorney almost got himself cited for contempt after this statement. Anyone got any other suggestions on remedying this?
Thanks to all who have posted. Please keep the info and ideas coming.
I guess this is why Bill Bronchick and so many others reccommend to own properties in trusts to maintain your privacy. Then if a lawsuit does come to haunt you they are suing an unknown principal.
Also it for reasons like this that we use corporation, LLC’s and Ltd. partnerships. They tremendously lower your chances of being held personally liable.
Re: HELP! Lawsuit Filed, Need Help - Posted by Bill Gatten
Posted by Bill Gatten on March 11, 1999 at 13:09:52:
In California we see this type of thing all the time. There is no such thing as AS IS, and irrespective of the Transfer Disclosure data, courts are continually finding for the new buyers in these things, whether the Seller had an idea of the problem or not.
It appears that the court’s attitude is that when the buyer came in, even if the appliances and systems were in good order at the time, they should be entitled to the same guaranty that the seller had when the original equipment was installed.
Many large Brokers with whom I work (CW Banker, Re/Max, C-21, etc.) tell me that they are forced to plan on being sued an average of about 1 out of every 100 transactions.
Know what would solve the problem? Loser Pays legislation…that’s what!! (Oops, a little editorial there–sorry).
Realtors for one, are only liable if they don’t follow the letter of the law OR they don’t disclose something that they know. If the realtor knew there was a problem (obviously didn’t two years ago) and didn’t tell the buyer that’s a different story.
As for your friend, if his paperwork stipulated that the house was sold “as is” I can’t see how he can be held liable, then again judges like to make things up as they go along. I assume he didn’t make any specific claims about the septic system at the time of sale.
My advice: GET A GOOD ATTORNEY to sort through this and to give you his legal opinion. Someone who handles a decent amount of RE and knows the laws. Keep us posted as to what happens, please.
Since all this is after the fact and the corps and trusts are not going to work, I would say your friend better have a very good attorney representing him. If he is already going to trial, then the only thing that is going to save him is a good RE attorney who also knows about this type of litigation.
The way I understand it is that transferring the property into trust really doesn’t shield you from much it just kinda makes it harder for people to find you (and that you own the property).
Now say they will sue anyway, now do the sue the trust itself? If they do sue the trust, who’s liable? The person who holds the beneficial interest … or … ?
I whole-heatedly agree with the user-pays comment. It seems as if our society has a “sue for a hangnail” mentality, and it will end up destroying the honest people. It is sad that things are this way, I mean the buyer refused an inspection which the SELLER had agreed to pay for. Go figure, huh?
My question is: What if I bought the house used and had NO GUARANTEE at all on anything in the first place? Then I sell it to someone else and they try to sue me when it fails. Then what?
Or are they saying if the appliance or furnace is 20 years old I have to warranty it like it was brand new? This is THE MOST ridiculous thing I’ve heard in a long time.
This country is REALLY starting to scare and annoy me.
That is EXACTLY what happened to Wes. He bought the house and 55 acres that adjoined his property. He then sold the house and 6 acres within about 2 mos of closing. He never lived there, and was only in the house 3 or 4 times. Truly remarkable. PLEASE read the post marked Follow-Up. You will go ballistic on that one. The people are trying to MAKE over $120,000 off of this.
As far as appliances, plumbing, electrical and water heater, the simplest answer is to purchase (for about $300, pass the cost on to the buyer) a one-year (or longer) warranty. There are several companies who do this for “used” houses as you call them. Makes the buyer happy; makes the seller sell faster; protects from some BS.
As for sewage, etc. - yes, realtors can be held liable - normally, though, the seller is the one who has to sign a form stating that there is nothing that they know of wrong with the house, so the realtor will not usually be found liable. And, the buyer is given the right to inspect.
Of course, when it comes to lawsuits, when have they ever made sense? Ask McDonald’s about the coffee.
Re: HELP! Lawsuit Filed, Need Help - Posted by Bill Gatten
Posted by Bill Gatten on March 12, 1999 at 16:45:41:
Redline,
Funny you mention the Mc Donalds case in this context. Two weeks before I heard about that case on TV, I was on my way to do a seminar at about 6:00 am, and stopped at an ARCO Minimart to get gas and a cup of coffee. As I was pulling away from the pump, the bottom fell out of the carboard cup they gave me, and the 600 degree Pakistani-made brew ended up in my own personal lap. I was in such pain at that moment that I couldn’t step on the brake and my car came to rest against the front door of the minimart. Before I could get out, I had 3rd degree burns on my butt and both thighs. As I finally bailed out I hopped up and down (flapping my trousers and whooping, at it were) for about ten minutes, I felt the good parts of what used to be my lap (and things) fuse into an amormorphous gooey ball of flesh. The onlookers apparentnly thought I was doing a comedy act, what with all my leaping into the air and flapping and all, and laughed heartily until I had fished.
I ended up in the emrgency room and missed the seminar and the next 3 days of work.
Did I sue? No, I laid low for fear that they’d sue me for the dent my car made in their stupid building.
I agree… this world is getting litigiouser and litigiouser every day.
I’ve followed this thread with keen interest. And much to my amazement I am now more fully aware of the criteria for joining a nudist camp!!
By the way, I noticed in another thread that you’re about to complete your new dictionary. Evidently the spelling of the word “amorphous” has changed. Please send me a copy of the dictionary.