Does a Seller Have a Right to Know Who the Buyer of Property Is?
If you’re buying property, you probably expect that both your broker, and the seller, may have to disclose certain things about the property that could affect your willingness to buy the property, or the price that you pay for that property or sell it for. But there’s one thing that you may not have thought you would need as a potential buyer: the actual identity of the seller.
Hidden Identities
Yes, in many cases, you won’t know the actual owner of property, especially if you are buying high end, expensive property. Certainly, there will be some seller to sell the property to you, but that seller may actually be covering up the true identity of the actual owner.
You probably already know that businesses can own other businesses which can have subsidiaries and fictitious names—with all of this, it can be hard to get to the bottom of who actually owns a business, or property owned by a business.
This is not an usual situation; in many cases, mostly for privacy concerns, high net worth sellers or well known sellers will use corporate vehicles, to hide the fact that they are buying or selling property.
The Jeff Bezos Lawsuit
One person who apparently does this is Amazon’s Jeff Bezos. His ownership of property is at the heart of a dispute between a seller and his broker.
The case involves a man who sold property to an unknown buyer. He, according to the lawsuit, suspected that Bezos may be the buyer, because Bezos owned property adjacent to the one being sold. He asked the buyer, and his broker, and was repeatedly told no, Jeff Bezos was not the buyer. The sale eventually closed.
Turns out, the corporate entity buying the property was Bezos. Now, the seller is suing both his broker and the buyer, for not disclosing that Bezos was the owner, as the seller says that he would have sold the property for millions more than he did, had he known of Bezos’ ownership.
This is because Bezos can now combine the two adjacent properties into one, if he so chooses—an ability that would have made the property way more valuable to Bezos, than to just any other buyer, a fact that would have affected the seller’s willingness to sell the property at the dollar figure that it sold for.
Broker, Buyer and Seller Disclosures
The case is pending, and we of course don’t exactly know who knew what or when. But the case is a reminder of the obligations that buyers, sellers and brokers have. As a general rule, anything that a buyer or seller can not possibly know on their own must be disclosed to them by the buyer or seller.
So, things that are easily discovered in a title or public records search, don’t have to be disclosed.
Additionally, any information that would materially alter the value or usage of the property must be disclosed. This could mean that there was an obligation to tell the seller that Bezos was the buyer.
Do your real estate closing the right way. Call the West Palm Beach real estate lawyers at The Law Offices of Larry E. Bray today for help with your real estate purchase or sale.
Sources:
foxbusiness.com/real-estate/owner-who-sold-billionaire-bunker-mansion-discount-sues-realtor-not-disclosing-jeff-bezos-buyer
thefund.com/resources/flarecs/blog/what-real-estate-agents-should-know-about-sellers.aspx