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Why do real estate brokers get sued?

On Behalf of | Jan 10, 2023 | Commercial Real Estate |

Commercial real estate offers exciting opportunities for investors, and more and more people are taking the plunge. Most of the time, the real estate brokers involved in these transactions are invaluable sources of information and guidance.

There is always the possibility, however, that your commercial real estate deal will not go as expected, and you will have no choice but to take things to court. Hereis why people end up in litigation with their real estate brokers:

Failure to disclose

If the broker knew that there were serious and material facts about a property that should have been disclosed and the broker concealed them, that may be a cause for action. For example, the broker may have known that a property had lead-contaminated soil or there was some cloud on the title when the broker pushed you toward the deal.


Misrepresentation occurs when the broker gives inaccurate information about a property. For example, you may have been misled about the zoning for the building or the boundaries of some attached land.

Breach of duty

When your broker is your agent and not a transaction broker, your broker has a certain fiduciary obligation to represent your interests – above his or her own. If, for example, your broker colluded with the other party’s broker to work a deal for their own benefit, that’s a breach of duty on both ends. Similarly, if your broker revealed your sensitive financial information to the other party, that would also be a breach of their duty.

Commercial real estate litigation can be highly complex, and there are often complicated financial issues that have to be considered. Buyers, sellers and developers alike can benefit from experienced legal assistance.