By Dennis Badagliacco
Dennis Badagliacco, is a member of AREA and a National Association of Realtors® Legal Action Fund Trustee 2013-2015 and the NAR Liaison with California Association of REALTORS®. He is on the cutting edge of legal matters affecting real estate and doubles as a commercial real estate broker in Silicon Valley, California and may be reached via email dennisb@legacyrea.com.
Potential Agent Liability for use of a broker’s trademark: A large company in Southern California, RE/MAX All Cities, was sued by a brokerage of 2 people who claimed they had the trademark to “All Cities”. RE/MAX had paid an attorney to research the availability of the trademark. Subsequently, the RE/MAX All Cites brokerage filed bankruptcy. The case of the two person All Cities Realty was thrown out of court. The small brokerage appealed claiming that EACH of the 1700 agents in RE/MAX All Cities is liable for use of the trademark. The case is on appeal and in order to be dismissed from the legal action the small brokerage is basically black-mailing the agents to settle for fees up to $5000 each. A few agents have settled. NAR and CAR are backing the agents in the appeal. Should the small brokerage win, the case would have huge ramifications nationwide. The small brokerage is owned by a Nevada Corporation and the agents practiced real estate in Southern California.
Flood Insurance: The National Flood Insurance program has never been financially based on an actuary table (as most insurance is). Congress passed a law to make the program self-sustaining. All properties in a 100 year flood plain now need an elevation “statement” in order to be sold. The current owner of the property is grandfathered (for a period of time) with the old rate. The new owner may have a huge rate increase. In some cases, the rate increase could be a 500% increase! NAR is sponsoring legislation to stop/delay the implementation of the new law. NAR has a form available for agents to use discussing the new flood insurance fees. If allowed to stand, many properties will be almost unsalable.
For more information on issues directly affecting you, Dennis suggests Real Estate Professionals consult with the appropriate legal and/or accounting professional.