Bluffing and larger-than-life promises so common in the business world, and especially in real estate investment deals, that no one would dare to object to them, much less in a court of law. Lots of business deals fall apart before or after coming to fruition because the parties realize that they cannot trust each other, and plenty of others go forward because one party decides to sign on the dotted line even while taking what the other says with a grain of salt. The law favors the vigilant, and before you sign any business agreement related to real estate investing or any other kind of venture, you should do your own independent research, preferably with the help of a lawyer, to verify your prospective business partner’s claims. If your business partner intentionally misleads you and goes out of their way to defraud you, then you have a good chance of recovering damages if you sue them for the financial losses they caused you. An Birmingham real estate lawyer can help you recover from a real estate deal gone bad.
Real Estate Investor Claims That Partner Defrauded Him to Pressure Him Into Selling His Share of Ownership
In 2004, Bill Lunsford, Wally Price, and Alan Goode formed the Riverfront Company, LLC, for the purpose of developing a real estate property near the Tuscaloosa Riverwalk. Goode sold his share to Lunsford early on, leaving Lunsford with two thirds of ownership and Price with one third ownership. In the summer of 2009, Lunsford told Price that he could no longer afford to continue with the project and planned to sell his share of ownership to Danny Butler, and he urged Price to do the same. Lacking the capital to stay in the project without Lunsford, Price relinquished his interest in the company.
On December 29, 2012, a colleague named Jerry Griffin told Price that Lunsford was building condominiums on the land that Lunsford and Price had once owned through their company. When Price asked him about Butler’s involvement, Griffin said that Butler was not and never had been involved in the project. The statute of limitations for fraud claims is two years from the date the fraud is discovered. On December 28, 2014, Price sued Lunsford; he also named as a defendant the credit union through which he had executed the documents relinquishing his ownership interest in the company.
The court ruled in favor of the defendants. It reasoned that Price should have known that Butler was not involved, because the documents Price signed in 2009 made no mention of Butler; therefore, the court counted July 2009 as the time that the clock started ticking for the statute of limitations. The appeals court upheld the trial court’s decision.
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A real estate attorney can help you ensure that your business partners are being honest with you before you sign any agreements, take on any debt, or give up any rights. Contact Cloud Willis & Ellis for help today.