Real Estate Disputes Attorneys TX
Some of the most contentious litigation arise out of real estate disputes. You have invested a lot of your time and your money into buying a home but may suddenly find that the seller failed to disclose a material fact that has adversely affected its value. Other disputes may be over property line designations, easements, or lease disagreements. The Austin business litigation & defense attorneys at Byrd Davis Alden & Henrichson, LLP have handled these as well as the following real estate disputes:
- Other property issues
- Purchase and sale agreements
- Breach of contract
- Title and title insurance
- Eminent domain
- Failure to disclose by seller
- Earnest money contracts
- Salesperson and broker liability
Some of the more common disputes pertain to real estate transactions where a seller failed to disclose a material defect in the property leading to salesperson and broker liability in some cases. Others involved property disputes.
Seller’s Obligation to Disclose
Many real estate disputes arise over a seller’s failure to disclose material defects in the property. In nearly every sale of residential property in Texas, the seller must disclose the presence of defects and items requiring repair in a written notice. The disclosure must indicate the following:
- Appliances or other features that are not working.
- Known defects or malfunctions in certain systems such as plumbing, electrical and heating and air conditioning.
- If events such as flooding, fires or termite infestation have occurred.
- Violations of deed restrictions
- Unpaid HOA fees
- Needed repairs
- Any condition that materially affects the health or safety of an individual.
The disclosures are not required if the home is acquired in a divorce settlement, foreclosure sale, deed in lieu of foreclosure, from a co-owner or governmental entity among a few other circumstances.
Some sellers and buyers may enter into an “as-is” transaction where no warranty or disclosure is made but there must be evidence that the parties were of equal bargaining positions and that the buyer was not relying on the representations of the seller. The “as-is” provision is more readily accepted by the courts in commercial transactions where the parties are presumed to be more sophisticated.
Texas Business and Commerce Code Section 27.01 (Statutory Fraud)
This law defines false representations and what makes such conduct actionable at law:
“A false representation of a past or existing material fact when the false representation is made to a person for the purpose of inducing that person to enter into a contract and is relied on by that person into entering into the contract… and relied on by that person in entering into that contract.”
There are also false promises where someone promises to do something that is not acted upon. It is actionable if the promise is material, was not meant to be fulfilled and was made to induce the person to enter into a contract and the promise was relied upon as a reason to enter into that contract. This law does not require you to prove the seller acted recklessly or intentionally in not disclosing a material fact.
A material fact is any fact that a reasonable person would have relied on to enter into the contract.
If the failure to disclose or false representation or promise was made intentionally and with full awareness of its falsity, then punitive or exemplary damages may be awarded along with actual damages. You can also collect attorney’s fees, expert witness fees, litigation expenses and court costs.
Common Law Fraud
Under principles of common law fraud, you can bring a claim against the seller if the seller’s false representations are material and made with knowledge of their falsity or recklessly without any knowledge if they were true but made with that assertion.
So long as you reasonably and justifiably relied on the false statement to enter into the transaction and suffered damages, you can collect compensation for actual damages.
Deceptive Trade Practices Act
You can also bring a claim for the seller’s failure to disclose under the Deceptive Trade Practices Act since the same language regarding the intentional failure to disclose a material fact to induce a person to enter into a transaction and which was relied upon by that person is found here as well.
This act also includes breach of an express or implied warranty or any unconscionable act by a person. A failure to disclose a material fact could be construed as an unconscionable act permitting the plaintiff to recover attorney’s fees, court cost and damages that are three times your actual damages.
Real Estate Agent and Broker Liability
Real estate salespersons work for brokers. An error or failure by the salesperson could extend liability to the broker meaning that an aggrieved party can pursue compensation from both.
Real estate license holders, however, are not liable for the misrepresentations made or concealments by their client unless they knew of the falsity or failed to disclose the falsity or concealment.
Other real estate disputes concern property boundary line and easement disagreements.
Easements are created by written agreement or by implication. There is the land that benefits from the easement called the dominant estate and the land burdened by it, or the subservient estate. There are rules for establishing an easement such as unity of ownership, continuous use of the easement and reasonable necessity for the use and enjoyment of the dominant estate.
Disputes arise when the parties fail to abide by the terms of the agreement or do not understand their rights and obligations including abandonment, misuse, interference or a failure to pay property taxes.
Boundary Line Disagreements
Your recorded property deed should indicate the legally recorded boundaries of your property. If there is a dispute, the county assessor can send a surveyor to review the land and compare the findings to the recorded deed and survey.
In some cases, the doctrine of adverse possession may cause a disputed portion of property to change ownership to the occupier. Texas has embodied this principle by statute and recognizes the claim if there is:
- Actual possession of the property.
- That is peaceful, open and notorious.
- Which is adverse to the owner’s claim.
- And is continuous for the statutory period, which may be 3, 5 or 10 years.
For claims under the 3 or 5 year statute, you will need a deed or other record of conveyance that gives you title. The 10-year statute does not require a written document indicating title.
You also have to demonstrate that the actual owner of the property had actual or constructive notice of the adverse possession and that you possessed it over the statutory period. Filing an affidavit of adverse possession constitutes notice and the date the adverse possession began.
Applying Alternative Dispute Resolution in Real Estate
Among the issues in real estate transactions that are better resolved with either mediation or arbitration include, but not limited to, the following:
- Repairs and inspection matters;
- Costs involving repairs or maintenance;
- Earnest money disputes; and
- Misrepresentation claims related to the property’s condition. This can also be applied in claims for the conditions of appliances and fixtures in the property.
When are these alternative dispute resolutions not appropriate?
Mediation and arbitration processes are not universally applicable. There are times when, regardless of the intention of the parties to save, these will not work at all. Among the instances when these may not be applicable are the following:
When one of the parties involved is accused of some sort of criminal conduct or offense, litigation process in the criminal court would be the more viable and appropriate option.
Mediation or arbitration is applicable between the main parties involved in a real estate transaction. However, this might not be the right way to resolve an issue that is related to ethical conduct. Specifically, if the consumers are the ones charging the realtors, for example, about their conduct.
There are times when real estate issues will involve complex aspects of legalities and property rights. In this regard, utilizing the expertise of real estate attorneys in taking the legal litigation process would be the best.
How long would the arbitration or mediation process take?
These kinds of alternative dispute resolutions are usually resolved in a matter of few months. There are some mediations that can be resolved in just a few hours or in just one meeting. Before the meeting, the mediator or arbiter will study the case. During the meeting, the sides of both parties can be heard first before making a recommendation. The said recommendation may be mutually agreed by both parties. If there are still unresolved matters, the parties may resort in escalating the case to a higher legal process.
Arbitration, in contrary, can be a little bit lengthy compared to mediation. This is because the panel or arbiter must make sure that the pertinent facts are presented to them before making a decision.
How much would these processes cost?
There are various aspects that will affect the exact cost of mediation or arbitration. These are usually the following:
Number of hearings
There will be costs involved every time that the mediator or arbiter convenes a hearing. Hence, if the issues can be resolved in just one meeting, the cost would be lower. However, if it will take a couple of meetings, the expenses would be higher.
Place of hearing
Some parties stipulate in the contract where they want the mediation or arbitration to take place. The objective here is to find a more objective ground. If the place of hearing will be abroad, then the cost would surely be high.
Law on Tree Damage
If someone damages your tree in your backyard, it is possible to recover the actual damages. Usually, the cost would either be the direct payment of the worth of the tree or the amount that you would need in order to replace it.
However, aside from Texas, there are also states that allow people to get additional damage compensation when someone deliberately damages your tree. Aside from that, intentional damaging a tree is considered as a crime in some states. Hence, the perpetrator of the said damage can be arrested, jailed, fined and even penalized. Moreover, general criminal statues related to theft and property damage are still applicable.
Law on Adverse Possession
Adverse possession means that a trespasser may come into a land, occupy and then legally occupy it, under certain circumstances. However, there are criteria in order for a trespasser to qualify to this adverse possession. These are the following:
- The occupation should be hostile, which means that it has no permission. However, its legal definition in different states may vary;
- There is actual physical occupation;
- The occupation is open and notorious, which means that the occupation is obvious to the onlookers; and
- The occupation is exclusive and continuous.
For the continuity, the timeline is either 5 or 10 years. If the trespasser has been occupying the land for at least 10 years already, but the property owner did not take any legal action about it, the right or ownership of the land will then be given to the trespasser.
On the other hand, if the trespasser has a registered deed and paying the taxes for the past five (5) years, the land ownership can already be transferred. This is also if the real owner did not object the occupation during the five-year stay of the trespasser there.
Law on Boundary Fence
One of the most common reasons of disputes among neighbors is related to boundary fences. Fences are usually located near or on the property line. However, there are times when building them might not be allowed in certain instances. Aside from that, there might also be issues on mutual responsibility when it comes to repairing and maintaining the boundary fences, most especially if the property line is shared by parties.
Law on Right to Farm
All the states in the country have laws that exempt farmers, or other agriculture-related operators, from the run of the mill nuisance laws. These are real estate laws that restrict or sometimes prohibit specific kinds of noisy or harmful activities, including heavy machinery operation, pesticide usage and the like. Hence, it is theoretically possible to have a farm in the middle of a residential area. However, different states have different definition of what constitutes a farming activity. Aside from that, some states also have special prohibitions on specific things like odor and dust, aside from the noise.
Real Estate Dispute Attorneys
There are many pitfalls to avoid in real estate transactions and property disputes. Whether you are a buyer, seller, real estate salesperson or broker, you need the services of a dedicated business attorney.
If you are faced with a lawsuit or are contemplating legal action concerning a real estate dispute, call our law firm at 512-271-5304 to arrange for an appointment.