In a precedent-setting case, the California Supreme Court will decide the degree of a real estate agent’s fiduciary duty to a client and the ethics of “dual agency” (an agent acting on behalf of both seller and buyer).
Aman is weeping in a Malibu condo on the inland side of Pacific Coast Highway. “When my son found out that the house was sold for $15 million,” he says, tears streaming down his face as his wife rubs his back at his dining room table, “he goes, ‘Dad, one day I’m gonna make my own money and buy that house back. I promise you that!’ It was his childhood. It was our heaven. It was stolen.”
Whether the beachfront home was, in some sense, stolen now is a matter for a judge to decide. But no one would deny that its location along ultra-exclusive, paradisiacal Watkins Cove a few miles away is heavenly. Not this couple, Iranian immigrants Zare and Seda Baghdasarian, and not Chris Cortazzo, their former listing agent — and current defendant in a $3.3 million lawsuit they’ve filed alleging fraud. Cortazzo, a Malibu native turned Coldwell Banker real estate powerhouse known for his Hollywood profile, purchased the property from the Baghdasarians in 2012 after failing to find them another buyer, then sold it four years later — after a renovation — for $15 million, well over twice what he paid his clients.
The outcome of the lawsuit, which is scheduled to go to trial at the Santa Monica Courthouse in September 2017, may hinge on the value of the home, a figure that varies widely with the vagaries of the real estate market and in any case ultimately is a subjective matter (as appraisers always are careful to note). But a larger issue raised by the case is the degree of a real estate agent’s fiduciary duty to a client and the ethics of “dual agency” (an agent acting on behalf of both seller and buyer) — a question that the California Supreme Court will take up in the fall in a precedent-setting case that also, as it happens, involves a lawsuit against Cortazzo and Coldwell.
READ MORE: http://www.hollywoodreporter.com/features/malibus-star-realtor-15m-flip-918177
