Attorney Fails to Provide Adequate Assistance to Client in Commercial Real Estate Acquisition

Case Overview

This case involves a defendant who was representing the plaintiff in purchasing property for her business in Minnesota. The property was integral to the ongoing viability of the plaintiff’s business, which is legally confined to very select locations. The company was able to continue at the same location because it was grandfathered in by virtue of being at the premises for an extended period of time. After renting the property for a number of years, the plaintiff wished to purchase the property, and hired the defendant to act as her representative and attorney for the purchase of the property. The plaintiff purchased the property pursuant to a contract for deed. However, the deed contained a clause that the property was subject to “any right of first refusal to purchase the property that seller has granted prior to the date of this agreement”. A right to refusal had been granted to a company to purchase the property. The attorney in deviation from his duties owing to his client (plaintiff negligently informed the plaintiff that he need not worry about the right of first refusal, and that the property would be sold to plaintiff despite the right. Shortly thereafter, the trust owning the building sold the property to a company pursuant to the right of first refusal. Litigation ensued and plaintiff lost the right to purchase the property. It was alleged that plaintiff will be deprived of the only suitable location for her business, and will be forced to close down the business.