I know, and have worked with, many commercial real estate (“CRE”) brokers. Most of them aren’t expert witnesses for legal matters related to CRE. Being an expert witness really gives me the ability to help my clients in ways brokers that aren’t expert witnesses can’t.
One primary way being an expert witness helps my clients is when I learn what the court judges will and will not allow even if a lease or other contract states something to the contrary. Even if the parties to a contract agree on an issue but it’s now allowed by law or by a judge, my understanding on these issues can really help me negotiate better for my clients and help them get out of sticky legal situations.
Don’t get me wrong; I am not an attorney. Hiring an attorney at the right time is something I highly recommend. But I am often able to use this type of experience, or clout, with a landlord (I bring the landlord tenants many times) as a broker to persuade the landlord. This includes the landlord’s property manager, and sometimes even their legal counsel, with me persuading them that they aren’t going to prevail on a certain matter. I can thereafter reach a reasonable settlement at great monetary, time and headache savings to my client.
And knowing what a court judge or applicable law will allow, no matter what is agreed to in a contract, really helps my clients when I negotiate their leases or purchase or sell contracts. If the opposing party to us doesn’t agree to change a term that isn’t allowed by law, it gives our side the ability to let this landlord get what he wants in exchange for something we want. However, I always recommend my clients run any of these types of matters by a really good experienced CRE attorney just to make sure before we say “yes” to the landlord on an issue like this. Many times the landlord doesn’t know the issue he is fighting for isn’t even legally enforceable and usually worthless to pursue for a landlord.
Lately, I have been involved in landlord/tenant or buyer/seller or other types of disputes on average about four times per month. Many of these disputes settle out of court, but the ones that don’t can go the legal way. With rare exception, most of the ones that head to court eventually settle, and many at the last minute before a court appearance. A few examples of some of my recent expert witness assignments involve: terminating a lease early for a tenant and requiring the landlord to mitigate the tenant’s damages, commission dispute between a selling broker and their client seller, commission dispute between a seller and party promised a finder’s fee (paid to a nonlicensed broker), and representing a tenant in retail shopping center against a landlord for a NNN and square footage matter that ended up with me having to testify in court. I would say the two biggest disputes that I am involved with as an expert witness include terminating a lease early (and requiring a landlord to reasonably mitigate a tenant’s lease damages as prescribed by applicable law) and NNN (tenant’s share of expenses usually for all retail and large industrial CRE) or operating expense increases over a base year (usually office and small industrial leases).
In summary, I learn quite a bit through being an expert witness by being involved in legal cases. Both judges and very good CRE attorneys have taught me much that can help my clients prevail in difficult disputes related to just about any CRE matter. And, if necessary and at the right time, I can refer my clients to a really good CRE attorney that has successfully handled their specific type of matter in the past.
If you have questions about any of the above topics or have any CRE needs, including hiring an expert witness, please contact David Massie at david@djmcre.com or 805-217-0791.