There’s a reason why all the law drama shows do so well on TV. There’s so much material revolving around lawyers and the people who need to call one—even if those people are ordinary people doing ordinary things, like buying and selling properties. Along with property managers—attorneys may be keepers of some of the best stories to come out of the Windy City’s co-ops, condos and HOA communities. They hear and see (and litigate) it all, from the crazy cat lady who has imaginary felines running around in her backyard to the suspected mobster who may—or may not?—be running a house of ill repute out of his condo apartment.
We found a few of Chicago’s residential legal pros, and got them to tell us some of those stories. Naturally, the names of the innocent (and not-so-innocent) were kept entirely confidential, and identifying information was altered to protect the parties involved.
“Being a real estate attorney means being part negotiator, part therapist and part big brother,” says John O’Leary, a partner at the O’Leary Law Firm LLC in Chicago. “The emotions involved in residential real estate transactions often cloud the ultimate goal of a smooth closing.”
Recently, O’Leary represented a buyer who did the final walkthrough of the condo they were purchasing and was horrified to discover that the seller had moved everything out of the house...except for all the furniture in the basement.
“When the realtor asked the seller why the basement was still full of furniture an hour before the closing, the seller responded that he was selling the house—not the basement.” Needless to say, some serious—and immediate—clarification was needed to explain to the seller that selling the home meant selling the whole home, including the below-ground parts.
O'Leary recalls a far more puzzling case that occurred concerning yet another basement: Every time the buyer viewed the basement, he discovered a puddle by the heater. But the HVAC contractor, who was hired by the seller (O’Leary’s client)—couldn’t find a leak anywhere.
Determined to buy the house with or without a leak, the buyers went through with the purchase anyway, and were pleased that the leak—and the mysterious puddle— disappeared after they moved into the home.
“I called the seller, my client, to give her the good news,” O’Leary says. “She told me she figured out the source of the problem after talking to her 9-year-old son. He did not want to move from River Forest to New York, so he was urinating on the basement floor prior to every buyer’s walk-through.” Give the kid points for style—if not for judgment.
Sweating the Small
(and not-so-small) Stuff
Jonathan Aven, real estate lawyer and president and owner at Law Offices at Jonathan M. Aven, Ltd. in Chicago, says he’s had his fair share of drama over the years—which is perhaps not surprising, given that he does 300 to 400 closings annually.
“I try to forget more than I ever remember when it comes to interesting events however,” he jokes. Still, he says, it is surprising how often there’s drama in his field. “I have a deal that’s more than $2 million, and [the parties] are fighting over a $200 item. Both sides have dug their heels in over the fact that they’re not going to budge. Ultimately, it will be resolved, but that’s the kind of mentality that we’ve been seeing a lot of most days.”
What’s surprising, Aven says, is that considering that many real estate attorneys went into the field to avoid the kind of drama that tends to accompany divorce cases and other types of high profile work, there’s still plenty of craziness in the real estate world.
At nearly every closing, he says, there are hiccups—and emotions tend to run very high, thanks to the large sums of money, tight scheduling windows, and high stakes involved.
For example, Aven says, large banks often aren’t ready for the closing on closing day—and you can’t close until the money shows up. Not surprisingly, sellers aren’t usually willing to let their house go without payment for it, which leaves the buyers without a home and the sellers very angry and upset.
“On Friday afternoon, if the money doesn’t show up, and the buyers have everything on the moving truck, but the sellers won’t hand over the keys because they haven’t gotten their money, then the buyers will be homeless for the weekend,” he says.
Aven has seen this happen on numerous occasions, though he says that often, the seller will work out a deal and at least allow the buyer's furniture to be moved in for the weekend. Often, though, the buyers will have to stay in a hotel while they wait for the money to clear.
Money and Feelings
Rachell Horbenko, a solo practitioner specializing in real estate law for The Law Office of Rachell M. Horbenko, concurs with Aven, and says there are often tears at the closing table. “I have spent hours fighting over a $50 dishwasher repair,” Horbenko says. “I have had an attorney or two stand over the closing table screaming at me over something that otherwise should have been a civil conversation. I have had more than one threaten not to show up at their closing the day of for minor repairs the seller did not complete, or for the fact that the home was not completely clean at the time of the final walkthrough. A friend of mine had to break up a fistfight at a closing between his own clients.”
Bradford Miller, senior attorney with Bradford Miller Law, P.C. in Chicago, says that he’s had sellers and buyers refuse to sit in the same room together—usually because of problems related to inspection or attorney review items. But one of the more challenging transactions he’s had involves a short sale in the South Loop neighborhood.
“The individual owed a lot of money to the bank, the condo association and to the IRS,” Miller says. “We were able to negotiate a fair deal with all of those parties in order to allow the sale to go through, but it took about 6 months. Luckily, we had very patient buyers.”
O’Leary had a case where the buyer came to the closing with $200,000 in cash—only to be told that the title company couldn’t accept that much cash at closing.
In this case, that was probably for the best; “Apparently, the buyer was a drug dealer who couldn’t get a loan, and wasn’t too keen on having a paper trail of deposits and checks,” O’Leary says. He’s also had clients die the week before closing, and even letters taped to the door of a seller notifying the buyer of a special assessment passed the night before closing.
Part of the problem is that buying and selling a home is usually the biggest transaction that people will ever make—and usually the most emotional one. Combine the two, and drama usually ensues. “Seemingly minor issues like bent dryer vents, small holes on walls and paint cans left in storage spaces can cause delays at closings,” O’Leary says. “When a client wants to stand his ground based on principle, you are in for a long, tough road to closing. I try to keep the ultimate goal in mind at all times.”
Aven also reminds himself and his clients that at the end of the day, this is a business transaction. “Sometimes, people get too emotional, and aren’t practical,” he says. “Yes, it’s your home and yes, it’s a big deal, but it’s ultimately a business transaction.”
Birds of a Feather...
Real estate drama doesn’t just enter into the arena of buying and selling a home, however. Allan Goldberg, a partner with the law firm of Arnstein & Lehr LLP in Chicago, recalls what he describes as the “Swan Lake case.” It was a lawsuit filed by a unit owner in an upscale community surrounding a lake stocked with swans. The swans were maintained by volunteers who fed the birds and kept the lake area clear of fluff, feathers, and droppings. But one of the unit owners filed a lawsuit against the association and the board members, saying that no domestic animals should be kept or maintained within any residence or on any lot except for household birds, dogs, cats or ornamental fish.
“The owner filed the lawsuit because he alleged that the swans were dangerous to himself and his wife because they were aggressive,” Goldberg says. “It was a nasty, bitter dispute—but it got settled, and to my knowledge, I don’t think the swans have returned.”
In another case, Goldberg says, a unit owner filed for a breach of fiduciary duty because she said that a large tree blocked her second floor window’s view. “It took quite a bit of discussion to settle the case, because there was no way short of cutting the tree down to give her the view back,” Goldberg says. The board ended up trimming the tree as a one-time compliance, but explained to her that while the seller may have told her that she had a great view of the water, that the view wasn’t guaranteed. “It’s a naturally growing tree,” he says.
Sometimes, situations involve legitimately unstable people, which make them extra challenging and require particular sensitivity.
“I once had to file a case against a unit owner who destroyed his condominium unit, harassed and threatened his neighbors, even poured urine under his neighbors’ doors and [put] feces on the door handles,” says Kelly Elmore, a principal with the law firm of Kovitz Shifrin Nesbit in Chicago. “Ultimately, the case proceeded, and although the judge was bending over backwards to help this individual, he eventually made a death threat to the judge, so each time I came to court, bailiffs surrounded me.” Eventually in that case, the association prevailed and was able to have the man removed from the building.
Real estate legal drama just goes to show that this field is not for the faint of heart.
“Despite what people may believe, the area of real estate law is an extremely emotional area of practice for our clients,” Horbenko says. “Most of the time, it's probably not as contentious as divorce or personal injury, but certainly people run high on the emotional scale during the process of buying or selling their homes.”
And while many of these stories are now amusing to recall now—and fun to tell at a dinner party—they are real and had real emotions, Goldberg says. “They present challenges that deal with human nature, the complexion of human principles,” he says. “They reflect the human side of living in a human environment.”
Danielle Braff is a freelance writer and a frequent contributor to The Chicagoland Cooperator.