Buyer beware, or maybe not? Homebuyer sues agents, brokerage over listing information

The buyer of a house in Miami’s Shenandoah neighborhood is suing the agents, brokerage and seller, alleging that they put fraudulent information in the listing.

Jessica La Torre sued Esslinger Wooten Maxwell, appraisal firm Amrock Inc., real estate listing agents Ana and Mike Anderson, and the seller, Juan Veloz last month in Miami-Dade Circuit Court. The suit alleges fraud, fraudulent inducement, negligent misrepresentation, breach of contract and civil conspiracy. La Torre is seeking damages exceeding $30,000.

The listing describes the house at 1722 Southwest 18th Street as a “diamond in the rough” with two bedrooms and one bathroom, plus a garage that was legally converted to a one-bedroom, one-bathroom apartment. La Torre closed on the home in September 2018 for $370,000. Property records show the house has three bedrooms and two bathrooms.

According to La Torre’s suit, the garage was not, in fact, legally converted to an apartment.

A spokesperson for EWM, now operating as Berkshire Hathaway HomeServices EWM Realty, declined to comment on the pending litigation.

The property listing (Realtor)

The lawsuit calls into question agents’ obligations to disclose information that would affect the value of a property, as well as their responsibility to not make misleading, deceptive or fraudulent representations, according to a demand letter sent by La Torre’s attorney, David Winker. The letter offers to settle the lawsuit for $65,000 in damages.

In the July 17 letter to EWM, Winker wrote that La Torre discovered that the garage was not legally converted after she began making cosmetic repairs to the garage. Winker, who called it “a failure on every level,” said that his client now has to tear up the garage.

Yet, according to the lawsuit, during the inspection on Aug. 1, 2018, co-listing agent Mike Anderson allegedly told La Torre that the garage had been legally converted.

Josh Migdal, of Miami-based law firm Mark Migdal and Hayden, who is not involved in the suit, said the sales contract ultimately controls what both parties agree to, not the listing.

In this case, the contract refers to the legal description of the property, which in the county’s property appraiser website, identifies the house as a three-bedroom, two-bathroom.

“It is highly unusual for a broker to make representations related to the property, thereby subjecting themselves to liability in matters of this type,” Migdal said. “Generally the onus is on the buyer to do their due diligence prior to closing on the purchase of a property.”

Write to Katherine Kallergis at kk@therealdeal.com