While showing a home to her clients, a real estate agent climbed up the stairway ladder to the attic. Unfortunately, one of the hinges broke and left the agent injured on the floor. The agent sued the owner and the listing agent. The court ruled the owner and listing agent could be held liable for failure to notify visitors of concealed dangerous conditions in the property being marketed. Hall v. Aurora Loan Services LLC 155 Cal.Rptr.3d 739 (2013).
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A property owner cut down a mature 70 feet tall Aleppo pine tree whose trunk was located partly on his property and partly on the neighbor’s property. He cut down the tree thinking the tree was his and that it presented a safety hazard. When sued by the neighbor, the trial court awarded double damages in excess of $100,000 and the appellate court affirmed. Kallis v. Sones (2012) 146 Cal.Rptr.3d 419.
Read the full entry...The California Court of Appeal recently held that a long standing encroaching fence does not establish the new property line between two parcels despite the agreement of the adjacent owners, if a survey can accurately determine the true property line. Martin v. Van Bergen (2012) 146 Cal.Rptr.3d 667.
Read the full entry...In July 2012, the California legislature passed into law, the Homeowner Bill of Rights (SB 900) to help struggling homeowners by providing safeguards in the loan modification, short sale and foreclosure processes.
Read the full entry...The Supreme Court of the United States held that a lender who charges consumers an unearned fee does NOT violate RESPA §2607(b), unless the fee was given and accepted between two or more persons. It does not bar unearned fees charged by a single service provider. Freeman v. Quicken Loans, 566 U.S.(2012)
Read the full entry...The 6th District Court of Appeals in California opened the door for a homeowner to sue their lender and possibly recover their home after foreclosure, if the borrower can prove that the circumstances and terms of the underlying loan were egregious, oppressive and predatory. Lona v. Citibank 202 CA4th 89 (2011).
Read the full entry...The California legislature enacted the following new laws for 2012 that are relevant to real estate.
Read the full entry...As of July 15, 2011, upon completion of a short sale with lenders’ approval, California law protects homeowners from ALL lenders with unpaid mortgage loan balances on the property after the sale. The old law provided debt deficiency protection from the primary (1st) lien holder only, but not from junior a (2nd ) lienholder, who could still sue the borrower after the short sale. New Senate Bill 458 amends Code of Civil Procedure §580e to provide liability protection to qualifying property owners from ALL mortgage lenders, not just the first lender.
Read the full entry...Where a civil judgment for fraud based on misrepresentation of the square footage of a residence was entered in favor of a buyer against his real estate broker the broker’s real estate license may not be suspended by the Department of Real Estate unless the judgment is based on “clear and convincing” proof of fraud. Grubb Company Inc. v. Department of Real Estate 194 CA 4th 1494 (2011).
Read the full entry...Real estate attorney Mark Strombotne will be a guest speaker at the upcoming Northern California Escrow Association Conference on July 15, 2011 at 2:30 p.m. in San Ramon, CA. The title of Mark’s topic is: “How to avoid Black Magic or Escrow Liability in a Short Sale”. The NorCal Escrow Conference will be held at the Marriott Hotel, 2600 Bishop Drive, San Ramon, California 94583. You need not be a member of the Association to attend.
Read the full entry...Buyer of a home in foreclosure failed to follow the statutory requirements of the Home Equity Sales Contract Act, which requires notice of right to cancel, thereby permitting the seller to recover an award of $660,000 in damages plus attorney fees against the buyer. Capon v. Monopoly Game LLC 193 CA 4th 344 (2011).
Read the full entry...Any real estate agent who negotiates short sales with lenders or promotes their services as a way to help consumers avoid foreclosure is covered by the new Federal Mortgage Assistance Relief Services (“MARS”) rules, and must comply with all requirements regarding mandatory disclosures, misrepresentations and the prohibition against collection of advance fees. [16 CFR 322 et. seq.]
Read the full entry...Click the Link Below to Watch the Discussion About Loan Modifications.
When Is A Loan Modification A Bad Idea?
This is a discussion about loan modifications between realtor DeVonna Meyer and real estate attorney Mark Strombotne.
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Read the full entry...A deposit does not become “non-refundable” merely by labeling it as such. To keep a defaulting buyer’s deposit, the seller must satisfy the statutory requirements for liquidated damages. Kuish v. Smith (2010) 181 CA4th 1419.
Read the full entry...Private individuals do not have the right to sue a non-complying lender or seek the invalidation of a foreclosure sale even though the lender failed to comply with Civil Code §§2923.52 which requires certain lenders to delay foreclosure proceedings for 90 days to allow the borrower time to seek loan modification. Only regulatory agencies possess the authority to enforce lender compliance. If the foreclosure sale has already occurred, the lender’s noncompliance with §§2923.52 or 53 does not affect the validity of the foreclosure sale. Vuki v. Superior Court (2010) 189 CA4th 791.
Read the full entry...When a real estate agent is aware that the amount of existing mortgage liens exceeds the sales price of a residential property, such that the property can only be sold by short sale, the agent has a duty to disclose this state of affairs to the buyer, so that the buyer can inquire further and evaluate whether to risk entering into a transaction with a substantial risk of failure. Holmes v. Summer (2010) 188 CA4th 1510.
Read the full entry...Beginning January 1, 2011, any first trust deed lender who approves a short sale of a residential real property, will be prohibited by law from collecting the unpaid loan deficiency after the sale.
ADVISORY: THIS LAW WAS AMENDED ON JULY 15, 2012. SEE THE SLF LEGAL UPDATE DATED JULY 26, 2011.
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The only remedy available to a homeowner for the lender’s violation of its statutory obligation to explore options to prevent foreclosure, is postponement of the impending foreclosure sale. However, if the foreclosure sale has already occurred, the lender’s noncompliance does not affect the validity of the foreclosure sale. Mabry v. Superior Court (2010) 185 CA4th 208.
Read the full entry...On October 9, 2008 the California Court of Appeal ruled that a lender’s oral promise not to foreclose on a homeowner was not enforceable unless it was put in writing and signed by the lender. Secrest v. Security National Mortgage Loan Trust 167 Cal. App. 4th 544 (2008)
Read the full entry...The California Court of Appeal for the Second District on November 1, 2007 ruled that a real estate broker has a fiduciary duty to disclose material information to its client, regardless of which salesperson in the broker’s office has the information. Michel v. Palo Verdes Network Group 67 Cal.Rptr. 3d 797 (2007).
Read the full entry...An escrow agent’s duty to disclose the distribution of loan monies to the lender, as agreed in the closing instructions, does not end upon close of escrow but continues until all monies have been distributed and the loans are closed. Plaza Home Mortgage, Inc. v. North American Title Company, Inc. 184 CA4th 130 (2010).
Read the full entry...SUMMARY: The California Court of Appeal for the Fourth District on January 24, 2007 ruled that a real estate broker can be liable for fraud by telling the buyers that the County told him the property could be subdivided when in fact the property could not be subdivided. Manderville v. PCG&S Group Inc. 146 CA4th 1486 (2007)
Read the full entry...The California Court of Appeal for the Second District ruled that when home mortgage lenders charged borrowers a marked-up price for the cost of services provided by others, such as underwriting services, tax services and wire transfer fees, then the lenders can be liable for violations of state and federal statutory protections. McKell v. Washington Mutual Inc. 142 Cal.App. 4th 1457 (2006).
Read the full entry...The California Court of Appeal for the Fourth District ruled that the standard form CAR residential purchase agreement used in California which requires the buyer and seller to mediate as a condition to an award of attorney fees in subsequent litigation is enforceable. Consequently a prevailing party who failed to mediate prior to commencing litigation was denied recovery of $158,000 in attorney fees. Frei v. Davey 124 Cal App. 4th 1506 (2005)
Read the full entry...SUMMARY: The California Court of Appeal for the Second District on September 21, 2006 confirmed a judgment against a real estate broker who originally helped a client with bad credit qualify for a loan to purchase a condominium but subsequently took over ownership of the property when the client did not make the monthly payments. Warren v. Merrill 49 Cal Rptr 3d 122 (2006).
Read the full entry...The California Court of Appeal in the 4th District ruled on July 7, 2003 that a seller’s failure to deliver a TDS disclosure statement gave the buyer the legal right to cancel the purchase even though buyer was unconcerned with the condition of the residence because buyer was purchasing the property as-is, and intended to demolish the residence and replace it with a commercial building. Realmuto v. Gagnard 110 CA4th 193 (2003).
SUMMARY: The California Court of Appeal in Los Angeles ruled on March 17, 2003 that a home inspector could not limit by contract the statute of limitations applicable to a claim against the inspector, to one year after the inspection. Rather the applicable statute of limitations does not accrue until the home buyer discovers or should have discovered the inspector’s negligence. Moreno v. Sanchez 106 CA4th 1315 (2003).
The California Court of Appeal in San Diego ruled on August 2, 2002 that a residential construction company could not enforce a purchase contract which required home buyers to waive their right to a trial of construction defect claims, or waive their right to a jury, or waive their claims for punitive damages. Pardee Construction Co. v. Superior Court 100 Cal.App.4th 1081 (2002)
The California Court of Appeal in Los Angeles ruled on April 4, 2002 that parties to a settlement agreement which did not request the court to retain jurisdiction over the case, had to start a new lawsuit to enforce breaches of the settlement agreement. Wackeen v. Malis 97 CA4th 429 (2002).
The California Court of Appeal ruled on March 21, 2002 that an arbitration award of a real estate contract dispute will not be reversed on appeal even if it contains significant legal or factual errors which result in substantial injustice. Harris v. Sandro 96 Cal.App.4th 1310 (2002).