Example Claim Scenarios

A broker representing a prospective tenant negotiated a long-term lease on a commercial building.  The tenant moved in and paid rent for approximately 6 months.  Subsequently, the tenant was unable to pay the rent and sold the company’s assets.  Because the building was single tenant occupancy and the economy in this region became depressed, the building owner was not able to rent the space to another tenant. Further, if and when they could rent the space, they would not be able to obtain the original rents as the market was now depressed.  The owner sued the broker for the value of the uncollected rent.   The alleged negligence in this case was that the tenant’s broker had an obligation to disclose any information regarding the financial condition of the tenant to the building owner. This case raises the legal issue of what obligations does a tenant/buyers broker have to the owners of the property and vise versa.

A buyer’s broker of a commercial property received an offer from their client.  In good faith they presented the offer to the owner for review.  Subsequently, the same broker received an unsolicited offer from another prospective buyer on the same property and also presented the offer to the property owner.   The second buyer’s offer was less than the first offer.  The buyer’s broker did not disclose that they were representing both buyers.  The original buyer was successful.  The second buyer alleged that their broker did not properly represent them. They have sued for the value of the lost opportunity, in excess of $500,000.

A building owner hired a real estate broker to sell a commercial property.  The owner completed a seller’s disclosure form with the help from the broker. The disclosure form listed minor water seepage in basement, which had been repaired. The buyer bought the piece of property and held onto it for 8 years at which time they sold the property.  As part of the new sale it was discovered that there was mold in the basement of this commercial property that had to be mitigated.  The new buyer (now 9 years later) sued for failure to disclose the hazard.  Although, the Statute of Limitation in this state was only two years, the new buyer did not discover the issue until 8 years after the sale.  Therefore, the statute of limitations did not start until the damage was discovered and thus within the statute of limitations.  The payout on this case was $800,000 from the building owner and $150,000 plus legal expenses from our broker client.

A seller’s broker negotiated a deal on behalf of a building owner for approximately $4 million for the sale of a commercial building. The seller agreed, however, refused to close the transaction.  The seller believed the sales price was too low, even though they had already agreed to sell the property.  The buyer sued the seller for specific performance and after 3 ½ years the courts compelled the owner to sell the piece of property. At the new closing the broker requested they be paid their commissions on the sale and the seller refused as they felt they had not received the proper value originally.  To make matters worse, the seller now believed the property was now worth $8 million.  The seller sued the broker for $4 million in lost appreciation, plus legal, plus punitives, etc.

In this case a selling broker sold a space to a restaurant owner whose intention was to open a restaurant with an outdoor café.  An overview of the plans for the café was presented to the seller’s broker and the owner and a sale was consummated.  Upon purchase, the buyer sought to obtain approval for the outdoor café.  Unfortunately, outdoor café’s were prohibited by ordinance in this town and the plans could not be approved.  The alleged negligence was that the broker should have been aware of the zoning restrictions relating to this property. The building owner settled for $175,000 split between the owner and the broker.

In this case a broker for a commercial property leased a space to a large tenant that utilized many large trucks in their business.  Over the years, they had parked their trucks in an adjacent parking lot.  This had gone on for many years and at least one lease renewal.  In this case, the same broker was involved in both the lease and also the sale of the adjacent building. The new owner of the second building was unaware of the arrangement with the prior owner to allow this tenant to use the parking lot for parking their trucks.  The new owner contacted the tenant and agreed to a lease for the portion of the parking lot, which amounted to several thousand dollars per month over the entire lease term.  The tenant sued our broker to recoup the cost of the additional rent (approximately $100,000).  The tenant finally settled for some rent relief from the owner and approximately $25,000 from our broker.

In this case several employees of a large employer group became ill with “Sick Building Syndrome.”  These employees sued their employer under workers compensation insurance for their disability, medical, pain and suffering, etc. The insurer for the large employer spent $5 million dollars defending the claim as they did not want to set a precedent.  The insurer ultimately won the case and settled for statutory workers compensation limits with the employees.  However, the insurer then sued our property manager for $5 million dollars to recoup their costs.  Over $250,000 has been spent in defense of this claim so far.

A tenant seeking a space for a restaurant submitted a signed lease with a real estate broker. The lease was not signed yet by the building owner. The broker requested additional information such as financial records, business plan, etc.  The broker was evaluating other options as well at the time.  Somewhere in the process, the broker allegedly led the prospective tenant to believe that the lease was a done deal even though the papers were not signed.  The prospective tenant quit his job, moved his family and prepared to start his business.  Unfortunately, there was never a signed lease and the space was eventually leased to another party.  The Plaintiff sued for a multitude of issues, primarily deceptive trade practices.  The suit is for $250,000.

A real estate appraiser was asked to conduct an appraisal with the caveat to not appraise the property unless they could guarantee the purchase price value.  This was a property in eminent foreclosure where timing was an issue. The appraiser performed the appraisal, which did not appraise at the purchase price.  The deal ultimately fell through and the buyer of the property and the seller why felt they had a way out of foreclosure ultimately sued the Appraiser.  On the surface the suit appears to have no merit, however, because of the disclosures up front, the Plaintiff believes another appraiser might have appraised to the purchase price.

After reporting multiple incidents of repeated sexual harassment by a supervisor, an employee alleged the supervisor began a systematic campaign to force the employee to resign. The jury award in this retaliation/wrongful termination complaint was $210,000 for mental anguish, $330,600 in lost income and $1,956,240 in attorneys’ fees.

An employee of a small business convinced the board of directors that he was qualified to step into the role of president of the company, and he was appointed. Under his leadership, the company’s financial position substantially weakened. On behalf of the company, a shareholder sued the board of directors alleging that they used poor judgment and did not act in the best interests of the company when they appointed the new president. The case eventually settled for $1,500,000 and legal fees totaled $300,000..

A retailer advised one of its suppliers that it ought to increase inventory because business was expected to increase significantly. Business did increase for the retailer but it decided to use a different supplier for the increased inventory. The original supplier sued the retailer alleging that he relied on the retailer’s promise of more business and suffered damages as a result of having relied on that promise. The matter was eventually settled for $500,000.

An employee sued a northeastern water treatment company alleging national origin discrimination in violation of Title VII. The plaintiff was awarded a total of $265,000 in damages, comprised of $150,000 in compensatory damages and $115,000 in back pay. In addition, the court awarded attorneys’ fees and interest in the amount of $232,711. The company only had 15 employees.

A jury awarded damages OF $1,000,000 to a terminated employee after she sued a privately owned service company for wrongful termination and breach of employment contract, as well as an implied covenant of good faith and fair dealing. Attorneys’ fees totaled $65,000.

A shareholder derivative action against a wholesaler and its directors alleged breach of fiduciary duty. The plaintiff alleged the directors breached their fiduciary duties and wasted corporate assets in connection with certain business transactions with affiliated companies. The case settled for $1,100,000 and attorneys’ fees amounted to $150,000./p>

Investors filed a $5 million derivative lawsuit against a private company alleging breach of fiduciary duty. The investors claimed that some of the company’s officers had personal connections to the third party contractor hired to re-tool the company’s assembly line and hired that contractor to further their personal interests, not the interests of the company. Other officers and directors were alleged to have either knowingly colluded with one another, or at least breached their duty of care in undertaking the project without properly investigating the qualifications of the contractor. The suit settled for $1.5 million with an additional $150,000 for attorneys’ fees.

During a press conference the president of a service company stated that the success of his company was due in large part to a competitor’s lack of customer service and inferior product. The competitor filed suit alleging that the president had negligently interfered with business relations. The jury agreed and awarded the competitor $2 million in damages. The attorneys’ fees for this case amounted to $150,000.

 An executive of a manufacturing company filed a suit against the company for wrongful termination and intentional infliction of emotional distress. The plaintiff, a former Chief Operating Officer, made statements that the company failed to pay an employee overtime and terminated the employee for filing a complaint. The plaintiff alleged that although the company advised him his termination was due to performance problems, he was actually terminated in retaliation for the honest statements he made in connection with a fellow employee’s termination. Total defense costs and settlement exceeded $500,000. 

A female employee working for a service company alleged several employees made inappropriate sexual comments towards her, including suggestions she was having a sexual relationship with another employee. In addition, she also alleged her boss and co-workers asked her inappropriate questions concerning her personal life. The plaintiff alleged that after she complained, her manager engaged in a practice of retaliation. She contended that she was excluded from certain meetings, taken off certain projects and assignments, treated rudely and received a negative evaluation. Total defense costs and settlement exceeded $550,000.

The plaintiff alleged her employment was terminated because she testified on behalf of another co-worker who brought a separate action against the company. Plaintiff alleged this was a violation of her employment contract which provided she could only be terminated for good cause. Plaintiff asserted cause of action for wrongful termination, breach of contract, and retaliation. Total defense and settlement exceeded $120,000.

In a cross-complaint, a doctor alleged a breach of his employment agreement. Specifically, he alleged the company failed to pay his wages, provide him with a decent patient load, adequate office space, and the proper support staff needed to perform his job duties. The doctor sued, claiming breach of contract, misrepresentation, unfair competition and failure to pay wages. Total defense costs and settlement exceeded $350,000.