Broker/Agent Liability

In Chan v. Tsang, the California Court of Appeal examined whether a buyer’s broker can recover a commission from a buyer who unjustifiably refuses to complete a real estate transaction. The court determined that the buyer was responsible for paying the broker $100,000, the commission that would have been earned from the seller if the buyer had fulfilled the purchase agreement.

Tsang (the Buyer) expressed interest to Chan (the Broker) in purchasing commercial property. The Broker introduced the Buyer to a property owned by Mountain View Center Associates (the Seller). The Seller accepted the Buyer’s offer of $4 million, with the Broker’s commission set at $100,000.

However, the Buyer later backed out of the deal without any valid reason. This led to lawsuits between the Seller, the …

Introduction:

When it comes to selling a residential property with one to four units, the seller has a legal obligation to disclose known material information affecting the value or desirability of the property. This is typically done through a Real Estate Transfer Disclosure Statement (C.A.R. Form TDS) and a Seller Property Questionnaire (C.A.R. Form SPQ). Additionally, a natural hazards (NHD) report can be ordered from a third-party company to identify any hazards in the property’s location. In this article, we’ll discuss the duty to disclose, how to modify a disclosure, and the buyer’s right to rescind if the disclosures are made after an offer has been made.

Duty to Disclose:

As mentioned, the seller of a residential property has a legal obligation to disclose known material information that could affect …