TARPON SPRINGS, Fla. (WFLA) – Two Coldwell Banker realtors are accused in lawsuit of concealing buyers’ offers in favor of bids that allowed them to collect all the commission on their listings.
An 8 On Your Side investigation into the $4.5 million dollar sale of a Bird Key mansion prompted another disgruntled buyer to come forward with claims his offer for a Tarpon Springs home was never presented to the seller.
In the real estate realm, representing the seller and buyer in a transaction is called “double ending,” and it is not illegal in many states.
Under Florida law, the transaction broker does not have fiduciary responsibilities to the broker and seller but is required to deal honestly and fairly with them and must present all offers.
In the Tarpon Springs deal, court documents state would-be buyer Michael Nadhenry offered $297,911 for a foreclosure on Big Base Lake Drive in 2015 but later found out it sold for about $17,000 less. The listing agent Mark Kimball said he presented all the offers, according to court filings.
Nadhenry’s attorney Benjamin Hillard said there is no proof of Kimball’s claim and he added a Coldwell Banker motion to dismiss indicates the brokerage firm asserts “its agents may effectively refuse to submit offers” from agents that do not work for Coldwell Banker. Nadhenry’s agent worked for Keller Williams.
Hillard, also a licensed real estate broker, insists the law is clear.
“You must submit all offers,” Hillard said. “Those duties are owed to all parties.”
Neither Kimball nor his attorney responded to a request for comment but in a statement Coldwell Banker spokesperson Roni Boyles said the firm “expects all of its affiliated sales associates to act with the utmost integrity and in compliance with all applicable laws.”
“This lawsuit, which was filed over five years ago, is without merit and we are confident that Coldwell Banker and Mr. Kimball will be vindicated,” Boyles said. “We are unable to comment further while the litigation is pending.”
Hillard blamed the complaint’s five-year timeframe on delays caused by Covid-19’s impact on the court system and the death of Nadhenry’s first attorney.
This Bird Key dispute involves another set of allegations against Coldwell Banker, and Sarasota area realtor Roger Pettingell.
Potential buyer Barry Cohen offered $500,000 over the $4.5 million sale price, according to his lawsuit that states he found out his offer was not presented after talking with owner Thomas Davenport.
“I went to the neighborhood,” Cohen recalled “He was walking his dog and we talked.”
Pettingell “advocated” for the offer from the winning bidder, calling it the “cleanest” and made about $276,000 by collecting all six percent of the commission, according to Cohen’s lawsuit.
Davenport is also suing Pettingell and Coldwell Banker.
“Roger and Coldwell Banker Realty believe that there is no merit to the allegations against him,” Boyles said in a statement about Cohen’s and Davenport’s claims.
The plaintiffs in both cases said they hope their lawsuits are a warning for buyers, sellers and the white-hot real estate industry.
“There are a lot of people who can be taken advantage of at a time when it’s critical for them to be treated fairly and professionally,” Cohen said.
The Massachusetts resident filed an unsuccessful complaint with the Florida Department of Business and Professional Regulation. Cohen was told in a letter “there is not sufficient evidence at this time to prove” Pettingell violated state real estate license law.
The letter stated Cohen could resubmit his complaint “if a civil judgment is obtained arising from fraudulent and dishonest dealings.”
Hillard said while there are two active lawsuits alleging claims of concealed offers, he “suspects” it happens a lot.
“Buyers and sellers need to follow up with questions if they suspect offers were not submitted. That’s really all they can do,” Hillard said. “That’s what happened in both of these cases.”
Hillard also suggested buyers and sellers should thoroughly vet agents before agreeing to work with them.
“Use someone you know and trust, maybe someone referred to you,” Hillard said. “It’s an important first step. When there are several offers on your property, it’s too easy to hold back an offer and you may never find out it happened.”
Neither Kimball nor Pettingell have responded to requests for comment. Hearings on the two cases are tentatively scheduled for early next year.