Hey, there! Log in / Register

Court: Real-estate brokers can be held legally responsible for what they tell buyers

A divided Massachusetts Appeals Court ruled today a man who bought a Norwell house in part because the broker told him it was zoned for use as the hair salon he wanted to open should get a trial to try to persuade a jury he deserves damages because it turns out the house wasn't zoned for that use.

Daniel DeWolfe bought a two-family house on Washington Street in Norwell that had been advertised by its listing brokerage, Hingham Centre, Ltd., as zoned "Business B," which a broker told him meant it was suitable for a salon. The property's MLS listing also said it was zoned that way, and the broker gave him a copy of part of the town zoning code allowing salons with "Business B" handwritten at the top.

In fact, the property was zoned "Residential B," which does not allow salons, and something DeWolfe did not learn until after he had gotten both a permit for a new septic system and a building permit to install his salon on the first floor.

A Superior Court judge threw out DeWolfe's lawsuit based on an earlier Appeals Court ruling that held brokers harmless in such zoning issues. A three-judge majority on the court, however, noted that the broker in that case never made any representations about the property's specific zoning.

And in their ruling, which hinged in part on a discussion of the grammatical construction of a clause in the purchase-and-sale agreement, the majority said that if the purchaser is looking for a particular kind of zoning and the broker keeps promising it, then the broker has a duty to ensure he or she got the zoning right on the property in question.

At issue was a standard clause in the purchase-and-sale agreement:

The BUYER acknowledges that the BUYER has not been influenced to enter into this transaction nor has he relied upon any warranties or representations not set forth or incorporated in this agreement or previously made in writing, except for the following additional warranties and representations, if any, made by either the SELLER or the Broker(s): _____

Where the blank had been filled in with "None."

The majority said clause after the "nor" is crucial because DeWolfe had relied on previously written representations, specifically, the MLS listing and the copy of the zoning code with "Business B" written on the top he'd been handed. To do so otherwise would be to render that half of the clause "surplusage," or useless verbiage and the law does not abide by useless verbiage.

The two-judge minority, however, said the "nor" means the only things the buyer should rely on is language specifically mentioned in the agreement - and it did not refer to zoning - or additional clauses the parties agreed to insert into the contract, which in this case, both sides agreed to add "none." The majority countered, however, that that would actually negate a long held right of buyers:

It would strip from every buyer using this form his or her right to rely upon written warranties or representations made by brokers or sellers, a right that every buyer and every lawyer until now properly has understood the buyer to have.



Like the job UHub is doing? Consider a contribution. Thanks!


So the dissenting opinion is: You can never believe a word an effing real estate agent tells you. If it's not in writing when you sign your name, assume they lied to you. That is, after all, what the document seems to say.

Voting closed 0

Yes, I think that's essentially correct.

Many written contracts specifically exclude from the agreement any previous oral or written statements or representations.

In theory, the written contract is supposed to be final document.

But I think the court got it right here. You have to hold the agent responsible for making a false representation. Otherwise, the temptation to lie and then say "It's not in the contract" is too great.

Voting closed 0

What about the realtors who advertise property in Southie as "Steps from Castle Island"? If you know anything about Southie, the nearest residence to Castle Island is about 2500 "steps" away. The realtors will tell you anything to buy.

Voting closed 0

I hate when real estate ads say "steps from X place".

When I sell a property, all distances will be in feet or tenths of miles.

Voting closed 0

When we bought our place in 2005, we used an AWESOME real estate agent who would frequently ask the seller's agents just exactly what they were basing their descriptions of a property on. He'd ask which specific "many popular shops and restaurants" the person was talking about and ask how far exactly was "walking distance."

He'd then tell us in the car that they weren't supposed to give any sorts of value judgments on neighborhood character, schools, crime, etc., because if he said that somewhere was "a safe neighborhood" and then something happened to the homeowner, he could be liable. He explained to us that the professional associations recommend that agents either use "I"-statements (I would feel safe here, I would feel comfortable sending my kid to school here) or provide copies of data about school performance, crime, etc.

Voting closed 0

The court basically has disregarded the "none" representation. I guess it doesn't matter what is written in contracts any more.

Voting closed 0