By DAVID STREITFELD
THE NEW YORK TIMES
CARLSBAD, Calif. — Marty Ummel believes she paid too much for her house. So do millions of other people who bought at the peak of the housing boom.
What makes Ummel different is that she is suing her agent, saying it was all his fault.
Ummel claims that the agent hid the information that similar homes in the neighborhood were selling for less because he feared she would back out and he would lose his $30,000 commission.
Real estate lawyers and brokers say the case, which goes to trial in North County Superior Court on Monday, is likely to be the first of many in which regretful or resentful buyers seek redress from the agents who found them a home and arranged its purchase.
“When your house appreciates $100,000 in the first six months, you’re not quite as concerned that maybe the valuation was $25,000 or $50,000 off,” said Clifford Horner of the law firm Horner & Singer. “But when your house goes down, you ask: ‘Who might have led me astray here?’ “
Agents representing buyers rarely had the opportunity to make mistakes during the last real estate boom, in the late 1980s, because the job hardly existed then. For decades, residential transactions almost always involved brokers who, whatever assistance they gave the buyer, legally represented only the seller. The long boom that began in the late 1990s put an end to that one-sided world. As prices spiked, buyer’s agents and brokers became popular as sounding boards, advisers and negotiators. The National Association of Realtors estimates they are now involved in two-thirds of all residential purchases.
That makes this the first housing collapse in which large numbers of buyers had a real estate professional explicitly looking after their interests. The Ummel case poses the question: In a relationship built on trust, where promises are rarely written down and where — as in this case — there is no signed contract, what are the exact obligations of these representatives in guiding their clients through a sizzling market?
“Agents have a lot of fiduciary duties, but they don’t make money unless they close the sale,” said Joel Ruben, a real estate lawyer in Manhattan Beach, Calif. “In an inflated market, there are built-in temptations to cut corners.”
The defendant in the Ummel case is Mike Little, a veteran agent with ReMax Associates. He will argue that Marty Ummel, who brought the case with her husband, Vernon, is trying to shift the blame for the couple’s own failures of research and due diligence.
“They simply didn’t do what is expected of a knowledgeable, sophisticated buyer, and are now looking for someone other than themselves to take responsibility,” Roger Holtsclaw, an agent who was hired by Little as an expert witness, said in a court deposition.
Horner, the lawyer, said valuation is a tricky area for brokers.
“Brokers aren’t appraisers,” said Horner, one of the writers of a guide to suing brokers. “They have no obligation to opine about value. But once they do, it becomes a gray area whether it’s puffery or a misstatement of a known fact.”
Most people who made a bad real estate deal might wince and move on, but people who know Marty Ummel describe her as unusually determined. She spent a year picketing ReMax offices on weekends.
Vernon Ummel, an administrator at Dominican University, gave her his permission to pursue the case, on one condition: “Don’t tell me how much the legal fees are.” So far, the bills come to $75,000, more than Marty Ummel’s annual salary as a fundraiser at California State University-San Marcos.
“I do not think I’m obsessive-compulsive, but I am 114 pounds of absolute perseverance,” Marty Ummel said.
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Nice job on this one Eric. We lived in Vista, CA (on the border of Carlsbad), so this article peaked my interest. If Marty wins, a Pandora’s box of lawsuits would certainly follow.
Interesting article, it kind of goes to show how people think, when things are great thier the genious. When they make mistakes or maybe over pay/ or just straight change thier mind it’s completly the agent’s fualt. In Tucson real estate prices vary considerably just like many other areas of the country and it’s completly possible for homes in the same area to range widely in price. Besides the only thing that validates anytype of value assigned is what a buyer is willing to pay, this buyer at one point was willing to pay the price of the home, if it was so overpriced why even take a look? Moreless buy, close and then decide “I paid to much” seems like a joke to me.
Marty needs to take a good look in the mirror and ask herself why she didn’t take time to research what was quite possibly the largest purchase of her lifetime. If I buy a used car and then find out that the vehicle has a propensity for burning oil and has a faulty transmission, do I get to sue my car salesman for not disclosing this? No. Because as a buyer, it is MY responsibility to check out what I’m buying.
Marty’s problem is that she started to view her home as an appreciating asset/ATM, instead of what it was: A PLACE TO LIVE.
She doesn’t deserve a dime. No one will look out for you better than you. Stop trying to shift the blame for your incompetence.
This is absolutely ridiculous. You can’t take your financial adviser or stock broker to court and you should not be able to take your RE Agent to court for falling value.
Ok here is the deal..
Now what happens if Mrs Marty Ummels lawyer looses the case and on top of it, and I hand hand her a flyer with a discount Lawyer that would charged her $25 thousand less??? in legal fees ? You can bet she would sue the first Lawyer……….
Well Mrs Ummel here is the Lawyer I would recommend to you, now this guy is a real winner !!! he is the lawyer for you, see him in action right here and now.—>
http://youtube.com/watch?v=25eCZVhBQPc
Vinny Bada Bing !!!
This is absurd! People like these that turn advantages of our judicial system into flaws make me sick.
From everything I have read I feel for the RE/MAX agent. It is consumers like this one who make everything cost more, and keep attorneys fully employed.
After doing some research, I have discovered that there is alot more to this than may meet the eye… In the Real Estate Profession, every state has a Department of Real Estate in which its job is to regulate and enforce Business and Profession Codes. Which in turn is overseen by the State Commissioner. In addition the Department of Real Estate has also their guidelines as well as a “Code of Ethics”. Which is outlined in the Contract Agreement between Seller/Buyer and Realtor… There is a Fiduciary Responsibility on behalf of the Realtor/Broker to be Honest, Ethical and in Good Faith. Also many of the Realtors become Members of an Association such as California Association of Realtors. This association and its members pride themselves on their STRICT CODE OF ETHICS! By becoming a member of such an association it is telling the Consumer that this Realtor is Professional, takes his profession seriously and abides by the Strict Code of Ethics. In turn the consumer is led to believe this person can be TRUSTED without hesitation. So, if a Realtor does not fulfil his obligation according to contract , in which his client is not taken care of to the best of his or her ability, the Realtor intentions regarding the sale may be at risk. Such as the Realtor in this case. By not taking care of his client to the best of his ability and in accordance to his fiduciary responsibility it looks as if, he was seeking monetary gains over his client. I don’t blame the Ummels… Their purchase was not pennies in the bucket.
There are many fallacies with California Law Regarding Real Estate. Such as Inspectors do not have to be certified. And even if they are, they are very rarely held accountable for any mistakes they may have made. In addition, I don’t think the general Californian public realizes that a Real Estate Agent can also have a CRIMINAL RECORD! He or she can be convicted of a Criminal Charge and still have a REAL ESTATE License. I recently learned that my Realtor had a Conviction of Spousal Abuse and was on probation when he sold me my house. In addition he had a conviction of a DUI and just got his 2nd one.. He recently lost his license because he didn’t pay his CHILD SUPPORT…. But even now, there is still time for him to be reinstated! WOW… I don’t know about you, but had I known about his Criminal Record I know I would have never hired him… My house was even sold to me without a completed Termite Report……… I am still trying to figure that one out. All I know, and I am speaking alot on behalf of my lawsuit and my current experience with California Real Estate Law, it is too relaxed and there are too many loop holes to get these Realtors off the hook from their so-called fiduciary contractural responsibility! Alot of these Realtors know that most people do not have the money to fight the deep pockets of a Broker whose Insurance pays for their Defense! In the end, most people give up and drop the case.
So, the details of my lawsuit are much more entailed then what I spoke of however based on my experience with my case, I hope the Carlsbad couple wins!
Sarah/Susan – take a look at the comparables for the property in question and I think you will see that (according to this data) the agent didn’t mislead his client. I’m really sorry to hear about your misfortunes, and I agree that it should be more difficult to obtain your real estate license. With regards to the criminal charges – the real estate industry isn’t the only industry that allows this – the bar, the medical board, and many others will give second and third chances.
When a profession is at a level of high regard for Honesty, integrity and of moral ethics which is outlined in their job duties, the consumer as a whole tends to TRUST and gives this person consent to conduct their job accordingly.
I don’t know, something about spousal abuse and dui’s and failure to pay child support orders rubs me the wrong way . And honestly, I believe it constitutes a character flaw in which I would not trust this person. All the lies and misrepresentation on my Realtors behalf could have been avoided had the law been more stringent. I trusted his referral to his friends Inspection company and I got stuck with a house that had been in a fire, totaling over $200,000 dollars in damages. Amazing what new paint and carpet will do…..this is only part of the story… the entire ordeal is horrific.
In regards to the Ummels, I believe part of their quest is the fact they trusted their Realtor when they were told they were getting a good deal… That TRUST factor can make someone really mad when you have reason to believe you may have been deceived. Especially when the Code of Ethics come in to play.
Anyway, just my opinion.
With regards to your case – I don’t know the details, and I would agree that those charges wouldn’t be typical for someone of high moral character.
With regards to the Ummels – take a look at the comparables, and see if you feel they indicate that the home was overpaid for. Also, remember that every person who borrows money from a bank to purchase a home is required to get an independent appraisal of that home. The bank’s underwriters then send that appraisal through their own appraisal review.
Dear Eric;
I recently experienced horrible experience with my real estate agent who was a friend and neighbor. I trusted her completely. I agreed with Sara with her comment in regards to fiduciary duty and ethic codes of a real estate agent. This horrible experiences had an emotional and financial stresses in my family life. It is injustice for buyer like me. The CA R.E board is too relaxed on the issue of fiduciary duty and ethic codes. I happened to google on other buyers’ ordeal. I will be glad to tell you my real estate experiences with ALL my real estate agent’s lies and misrepresentations to benefit herself in more commissions. There are other victims who are also my friends and families.
Hi Maztee…. I am sorry to hear of your horrible experience regarding your Real Estate agent and the purchase of your home. While this experience of buying a new home should be one of excitement and happiness, the consumer must be extremely careful with whom they are doing business with…. With that being said…. You need to find out whether or not your Real Estate agent has broken any State or Federal Laws. Such as Breach of Contract, Fraud, Misrepresentation etc…… Do you have any witness’s that can vouch and or prove that there was any “wrong-doing” on behalf of the agent…. You can also go to your State Board of Real Estate Agents…. this is a Goverment page and you will have access to your Realtors History as an agent… If you do not have the Realtors License you can type in her name and it will tell you Some information regarding the history of her held licenses, education and if she has lost her license for any reason such as displinary action…. It will tell you if she is currently employed and by what Broker etc etc etc… If you truly feel that you can prove that you and your family were defrauded in any way you can open a case with the Department of Real Estate and if they deem your claim of legal concern they will prompt an investigation… HOWEVER…… depending on what state you reside, Real Estate agents are protected to some degree by their contracts they have you sign when you purchase the house… Most cases Realtors are saved by these contracts… However, HORRIBLE NEGLIGENCE does not protect them in regards to the contract…. And it must be proven in a court of law…. You may also, write your State Commissioner… This is also a goverment page and easy to find…..Now if you think your Realtor is a crook…. Start checking out Public Records as to whether or not this person has a Criminal Background…. Just because they have a Realtors license it does not mean they do not have a criminal background….. Also, find out who else this agent has Represented… Go and interview these people to see whether or not she dealt with them in the same manner you felt you and your family were.. And I also recommend seeking the advice of a REAL ESTATE ATTORNEY…. Do not be fooled into thinking that ANY attorney with a law degree can help you….. It is IMPERATIVE to contact a REAL ESTATE ATTORNEY… You also need to check out the attorneys background… State Board of Attorneys….. Public information and is your right as a Consumer to obtain this information. It is unfortunate but you CANNOT TRUST people to conduct themselves in a honest and ethical way when the name of the game is money…… You as the Consumer, must always protect yourself and your family…. Do your homework, do what you need to do to educate and protect yourselves from falling prey to Vulchors…..And this is a good rule of thumb when dealing with anyone… With all due respect to Realtors everywhere, not everyone in this industry conducts themselves in unethical behaviors…. There are alot of Awesome Realtors out there and I do not want to send a negative connotation to All Realtors…. However, As mentioned before…. it is ultimately up to the Consumer to make sure they are not being defrauded….. I wish you well in your quest for justice and I hope that your family will find peace with the outcome of your efforts….. Oh…..also, refrain from blogging or writing any ill comments specific to names and or business’s…. Because, eventhough you may be upset and you feel you are right in what has happened to you, this person and company could turn around and sue you for Deformation…. And this is the last thing you want to happen…… Take Care and my Best to you and your family
Hi Maztee…. I apologize for the grammer and mispelled words… I did not proof-read… I completely mispelled VULTURES and I mispelled DEFAMATION… So, I am sure you understood the points I was trying to get across… My best to you..