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Important Real Estate Litigation FAQs to Know

Important Real Estate Litigation FAQs to Know

3 Frequently Asked Questions About Real Estate Litigation

Real estate litigation can arise from any dispute relating to real property, such as one’s home, land, or rental. Many people will either purchase or inherit some form of real property during their lifetime, and even those who do not will typically have at least some experience renting either residential or commercial spaces. For many, real estate will be the most valuable thing they ever own or possess, whether in terms of financial value or emotional attachment to the place they call “home”. Since real estate is so valuable and each piece of real estate is considered unique under the law, when disputes concerning real estate arise, parties to those disputes are often willing to pursue their respective claims all the way to litigation.

Additionally, real estate litigation is unique because of the wide-ranging outcomes that are possible. While most people are familiar with the type of litigation where one party sues another for money, real estate litigation can result in far more consequential outcomes. For example, depending on the issue presented to a court, judges can order that: (i) people be removed from property; (ii) property be bought, sold, or mortgaged; (iii) property lines be redrawn; or (iv) already completed conveyances of property should be undone.

In this article, we will explore three of the most frequently asked questions about real estate litigation.

1. What are typical causes of action arising from real estate disputes?

Real estate litigation can arise from many different types of disputes and relationships. The most common types of disputes arise from the landlord-tenant relationship, disputes among buyers and sellers, disputes among neighboring landowners, disputes among joint owners, divorce, and disputes between debtors and creditors.

Landlord-Tenant Disputes.

Landlord-Tenant litigation is one of the more common types of real estate litigation and the type with which people are probably most familiar. These types of disputes can include suits for eviction (often for non-payment of rent, but for other reasons as well), early termination or violation of a lease by either the tenant or the landlord, the return of a security deposit, or disputes over maintenance of or repairs to a rental property.

Buyers and Sellers.

Buyers and sellers of real estate will almost invariably memorialize their transaction with a written contract that sets forth the material terms of the agreement, such as the description of the real estate being sold, the price, the condition, contingencies for going through with the sale (e.g., the buyer securing a mortgage, a satisfactory inspection, etc.), and the date the parties intend to transfer title (i.e., a closing date). When a buyer or seller breaches these contracts, the dispute can sometimes lead to litigation. While lawsuits in these types of litigation are often for money, if either party refuses to complete the sale, the party who still wants to complete the sale can ask the court for a special remedy called “specific performance”. When a court grants specific performance, it can actually order an otherwise unwilling party to buy or sell the property as the case may be.

Disputes Between Neighboring Landowners.

Real estate litigation can often arise when there are disputes between neighbors concerning boundary lines, encroachments, or easements. Common scenarios where this type of litigation might occur is when one neighbor alleges another’s fence, deck, or even landscaping actually extends over a boundary line onto their property. In this type of litigation, the court can order: (i) the boundary lines redrawn; (ii) one landowner to pay another for the right to use the other’s property (i.e. an easement); or (iii) that the encroaching structure be removed.

Disputes Among Joint Owners.

In situations other than when property is owned in common by a married couple, sometimes disputes arise between common owners about access to real estate, payment for its maintenance, repair, or expenses, or division of rent when common owners lease a property to renters instead of occupying it. In some cases, one joint owner may decide they no longer wish to own real estate with the other owners. This can give rise to a lawsuit seeking a special remedy called “partition”. In a lawsuit seeking partition, the court can order that the real estate be sold over the other owners’ objection and can make orders about how the proceeds are divided.

Disputes Between Divorcing Couples.

While not strictly real estate litigation, disputes over real estate often arise in the context of a divorce. Real estate that couples purchase together during the course of a marriage often becomes marital property subject to division upon a divorce. Divorcing couples must come to an agreement about how that real property will be handled and how a mortgage that might be associated with that property will be addressed. Sometimes the property will be sold, and the proceeds divided. Other times, one spouse will be permitted to keep the property but must refinance within a certain amount of time to remove the other spouse from the mortgage. If the parties cannot agree between themselves how to address real property, the court will decide for them following a trial. Unique to a divorce action, a court can even order that a mortgage loan be taken out on a property to create a fund for the parties to pay their divorce litigation expenses.

Disputes Between Debtors and Creditors.

When a creditor is owed money, if the creditor gets a civil judgment, a debtor’s real estate can sometimes be ordered to be sold and the proceeds used to satisfy that judgment. In the hope of avoiding such a sale of their real estate, debtors sometimes transfer their real property for little or no money to family, friends, or separate business entities. When a debtor takes such an action, it can give rise to a lawsuit for fraudulent conveyance. In a fraudulent conveyance lawsuit, in addition to other remedies, the court can order that the real estate conveyance be set aside (i.e. voided or reversed), to allow a creditor the opportunity to sell the real estate to satisfy their judgment.

2. Who needs to be represented by an attorney?

Anyone whose real property is the subject of a legal dispute should consider hiring an attorney. For many people, real property is their most valuable asset. Real estate law can be complex. It is often governed by vague statutes and relies upon principles developed by court decisions over the course of many decades. Not only can an attorney advise litigants of their legal rights, but a qualified attorney can also help to protect those assets to the greatest extent possible. Those considering or threatened with legal action in connection with real estate should consider consulting with an experienced attorney. FSKS has several experienced, qualified attorneys to assist clients with all real estate matters, from simple transactions to complex litigation and everything in between. A real estate litigation attorney can help someone decide if they have a legitimate claim or defense, determine if pursuing litigation is in their best interest, or if any non-litigation options could be pursued to secure a cost-effective resolution.

3. How are real estate disputes resolved?

Like most litigation, many real estate disputes are resolved through the negotiation of a settlement agreement. While lawyers representing the parties are sometimes able to negotiate a resolution, other times the parties will choose to submit their dispute to a neutral mediator to help foster a resolution. Unfortunately, very often the parties are unable to settle their dispute, and one party or the other decides to pursue through litigation in court. This litigation may include having a judge or jury hear all the evidence presented in a trial on the matter and decide on the case’s outcome.

FSKS is on Your Side

At FSKS, we understand that real estate disputes can be stressful and challenging for every party involved. That’s why we believe in maintaining an open flow of communication with our clients to ensure the successful handling of their real estate litigation matter. If you find yourself involved in a real estate dispute and need an experienced attorney you can trust to weigh the pros and cons of litigation, please contact Alan Golub (agolub@fskslaw.com) or Andrew Grenell (agrenell@fskslaw.com). And for advice or representation related to the purchase or sale of residential or commercial real estate, contact Eric Kapnick (ekapnick@fskslaw.com) or Jon Sherman (jsherman@fskslaw.com). All attorneys can be reached through our main number at 973-538-4700.