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Realtors most commonly use fliers and advertisements to attract interest in the properties they list. Many representations and information often included in these marketing materials could be vulnerable to legal claims. Considerable thought should go into the representations contained in all collateral materials. The following is intended to identify some examples, along with means for mitigating your risks.
Word choice in marketing materials is critical. Be careful when using brand names that in the public's mind have become generic. For example, "Jacuzzi." Many call all hot tubs "jacuzzis." In reality, "Jacuzzi" is a specific brand. If a hot tub is advertised as a "jacuzzi" and it is made by another company, false representation could be charged.
Using absolute adjectives like "best," "finest," "greatest," and "new" to describe some element of the property could be detrimental. An unscrupulous attorney could argue that such a representation led the buyer to purchase the property under the belief that the item(s) were the "best" or "new." It is recommended that more suggestive terms like "beautiful," "great," and "nice" be used. They allow for the possibility that there may be something better.
Statements concerning square footage should always be accompanied by disclaimers; the source of the information; the fact that the square footage stated is only an approximation which has not been verified by the realtor; and a warning to all potential buyers to have the square footage independently verified. In addition, the square footage specified should always be rounded down to at least the next lowest one hundred feet, giving room for error.
Specifying a value for fixtures or other items at the property will create additional risks. There is no certainty as to the measure of value. Thus to include such statements as "sale includes a chandelier worth $2,000" is not recommended.
Independently take steps to verify all information contained in the marketing materials. In addition, consider including a disclaimer similar to: "The information contained in this material is unverified. Potential buyers should take all steps necessary to satisfy themselves regarding the information contained herein." With this type of disclaimer, at least some of the burden is shifted to the buyers in the event a claim arises regarding the marketing material.
As a final consideration, always have the sellers sign a copy of all marketing materials before they are distributed. The sellers could write, "I have reviewed this document. I verify and approve the information contained herein." This will help to defeat any claim made regarding your marketing materials. And it will provide strong evidence that you acted in good faith in obtaining the information used to market the property.
By following these steps you can successfully market properties without taking unnecessary risks in the process.
Copyright 2000 - Spile & Siegal, L.L.P.; Phone 818-784-6899; Fax 818-784-0176; E-mail: counsel@spile-siegal.com; Website: http://www.spile-siegal.com |
