Real Estate Agent Held Liable Based on the Undertaker's Doctrine

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In a recent appellate court opinion that was filed on May 2, 2018, a real estate agent was found liable based on the “undertaker’s doctrine.” This case, Muchnick v. Goihman, Third District Court of Appeal of Florida, Case No. 3D17-122, is relevant to my practice of real estate litigation and landlord-tenant disputes.

During an initial tour, Michael and Valerie Muchnick noticed some issues with the property, which the real estate agent, Richard Goihman, assured he would fix before they moved. However, once they moved in, they discovered the problems were still there, and that they were much worse than expected. In fact, there was mold in the ventilation system from a bathroom leak, which led to health problems for their children.

Despite Goihman’s assurances that he would fix the issues, he negligently failed to provide a remedy. The Muchnicks sued, but Goihman was granted a summary judgment. The Muchnicks then appealed this summary judgment on the basis of Goihman’s negligence and fraud. Although Goihman claimed he was acting within the scope of his employment for an entity (in this case, the real estate brokerage company), he was still held personally liable on the basis of the undertaker’s doctrine. The summary judgment was affirmed regarding the fraud claim, but was reversed regarding the negligence claim. Thus, Goihman was held liable based on his negligence in the undertaker’s doctrine.

What Is the Undertaker’s Doctrine?

The Florida Supreme Court defines the undertaker’s doctrine as: when a person makes a promise to provide a service, either through a contract or voluntarily, he or she has a duty to act carefully and to exercise reasonable care. The undertaker (person who promises to provide the service) may be held liable if he or she fails to exercise a reasonable duty of care that results in harm to the beneficiary, or if the beneficiary is reliant upon the undertaker and suffers harm as a result. Under this doctrine, Goihman owed a reasonable duty of care to the Muchnicks to fix the property issues.

This case is significant because I suspect that real estate agents often promise to perform corrective actions and remedies in order to make deals with tenants and purchasers. However, through the undertaker’s doctrine, they may now be held liable for failing to follow through on their assurances.

If you need experienced representation for a real estate or landlord-tenant dispute, call my firm, Gregg H. Glickstein, P.A., today at (561) 953-6662. With experience as a Boca Raton business attorney, I will aggressively protect your rights and interests.

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