Tuesday, October 19, 2010

The Great Real Estate Question

Hypothetical: A smiling, very pretty little real estate agent shows a house to a newly-married couple. It is well-constructed. The major components -- roof, windows, furnace, air-conditioner -- are recently installed and ship-shape and so won't need replacing for decades. It is in a good neighborhood. The husband says, "Wow! What a deal! Why such a good price?"

"The widow who owned it had to move," the real estate agent explains. "She asked me not to invade her privacy too much by explaining more than that to persons interested in buying her home."

"Well, tell her that we'll take it!," the wife declares, smiling. "Where can we sign on the dotted line?"

A month-and-a-half later, closing occurs. An attorney appears for the widow, and signs for her under the authority of a Power of Attorney. 90% of the purchase price is mortgaged. The newlyweds are locked-in to 30 years of debt, but they are happy with their new home.

After they have moved-in, they hear knocking in the walls at night, they feel clouds of cold here and there in the house, they hear footsteps on the floors, and they are constantly awakened by tapping on their hips at night.

After a few weeks, a neighbor tells the disturbed couple, "Wow, we thought that this house could not possibly sell! And why do you both have such deep, dark circles under your eyes?"

"Why didn't you think that anyone would buy the house?," asks the wife.

"Oh, because of the double murder there last year! The wife murdered her unfaithful husband, and then she murdered her own son when he tried to stop her from murdering her husband! She was taken away in handcuffs by police, and is still awaiting trial! Ever since then, this place has been outrageously haunted! Even the police are afraid to go in! If you ask me, the market value of that house is about 2 cents!"

Shocked, the couple rush over to the real estate agent's office, and say, "You defrauded us! You know that we would never have bought this house had we known that there was a double murder, there! Who will ever buy it from us? And the murders left behind ghosts! We can't sleep there at night! The ghosts won't let us rest! It's terrifying, there!"

"So sue me!," answers the real estate agent. "I told you what I could! I called the seller a 'widow' and I said that she 'had to move.' She did, when they cuffed her! And then I resorted to the right of privacy. That should have been enough to tip you off! We have a duty to our clients, and this particular client insisted that the embarrassing accusations against her -- and they are ONLY 'accusations'; she's presumed innocent until proven guilty, right? -- be kept private! Do YOU have constitutional rights? Well, SHE DOES, TOO! And besides that, you don't REALLY believe in GHOSTS, do you?"

And the real estate agent drives to the bank and deposits her commission check, smiling.



  1. Why should the Real Estate agent be held responsible for Tulpas. Perhaps tulpas from the original family, perhaps tulpas from the locals who look upon the house with GREAT anxiety, perhaps, some tulpas from the married couple, once they found out the secret.

    Fraud? hmm, nah.
    Or, yes.

    Lots of fraud goes in to a real estate transaction, almost always on behalf of the seller and those representing them.

    No, no termites. Never had them. Not a problem.

    When purchasing my house, the owner had a pest control company certify that the house was pest-free. There was a mud tunnel going up the basement wall.

    If we call it fraud that the real-estate agent didn't feed into peoples superstitions in the name of making a sale, then its fraud.

    But, given lack of proof, I find it hard to believe that this would fly in court.

    Why should agent disclose a 'social issue' (ok, understatement of the year) of the prior occupants that the buy could use as leverage to lower the price (and less commission for agent).

    Let the agent cash the check.

  2. Hi, Tom.

    Most states agree with you, even if your own real estate agent records in her diary, "Heh, heh, heh, because of those murders, these poor, dumb suckers will NEVER get any equity out of this house!"

    Another case (one of my cases): Husband and Wife buy a house. Their own real estate agent arranges for the $75 termite inspection required by the mortgage company, but Husband and Wife must pay the $75, and the document on its face is expressly addressed to them. "I, Mr. Termite Inspector, certify to Husband and Wife that there are no active termite infestations or uncured termite damage on the premises."

    Settlement occurs. Husband and Wife are so happy with their purchase!

    They move in all of their furniture. As they are sitting there, one DAY after settlement, eating dinner in the dining room, they suddenly hear a cr-r-r-r-r-rack! And they feel the floor surge downward.


    What had happened is that termites had entered the sill plate at the top of the basement wall, and entered the joists resting in the sill plate, and turned the joists into that paper-mache-like material that termites leave behind. Furniture in the house was the straw that bropkew the camel's back.

    We sued the realtor and the termite man. Both of their insurance companies paid 50/50 for the repair, as well as my attorney's fee.