The Illinois Company of LJ Jordan alleged negligent misrepresentation in a lawsuit brought against the real estate agent the company worked with when acquiring a piece of land. The seller and real estate agent both assured LJ Jordan that the land was free of pollutants. After the sale, LJ Jordan tried to lease the land, but during the potential lessee’s due diligence, it was discovered that the land was contaminated and refused to lease. LJ Jordan is claiming that they will never be able to lease the land until the contaminants are cleaned.
In this matter, the real estate agent relied on the seller of land for their pollution report and did not do any further examination. While additional investigation was not required, this matter shows how a real estate agent can be brought in to a claim long after a transaction take place – and without direct fault of their own.
BrokerLiability.com notes that it is important for a firm to have the proper limits and coverages in their real estate professional liability insurance policy. Contact us for a review of your firm’s policies.