Depositions Can Be Pitfalls for Real Estate Agents, Attorney Says
-But proper preparation can help agents and their employer avoid potentially disastrous outcomes, advises LeClairRyan's Jay Gregory
Apr 01, 2011, 09:30 ET
BOSTON, April 1, 2011 /PRNewswire/ -- Many real estate agents can expect to get a seemingly innocent phone call requesting them to appear at a deposition at some point in their career. But, as veteran LeClairRyan real estate attorney Jay S. Gregory writes in an article recently published on BrokerAgentSocial.com, that call "is not always the simple matter it might seem at first glance."
Drawing on the experiences of multiple clients he has represented in similar situations, Gregory offers a stark warning: "Even if the matter the attorney is calling about appears not to directly affect you and/or your firm, your radar should go up right away. And if you are ever subpoenaed for a deposition, it is important that you arrive well prepared and with legal representation of your own. Failure to do so can have far-reaching effects on both you and your firm."
Gregory serves up the example of an alleged predatory lending case involving multiple law firms, eight separate plaintiffs and a shady "no-money-down" straw buyer scheme at the peak of the real estate bubble. LeClairRyan represented a local real estate franchise which had a former agent involved in the scheme. On the verbal promise that he was not a target and would not be deposed, the agent met privately with plaintiff attorneys and ill-advisedly provided them with information and documentation that led to suits against more than a dozen parties, including his former agency. And despite the earlier promise to the contrary, the agent was then compelled to appear for two days of deposition.
"The first mistake this agent made was believing that the plaintiff's lawyer was his friend," Gregory writes in "Depositions Can Be Pitfalls for Unprepared Real Estate Agents." Showing up for the deposition without legal representation of his own only compounded the problem, with the plaintiffs' lawyer confusing the agent and extracting testimony that was uninformed and inconsistent, and which provided ammunition against his former agency. "If that agent had been properly prepared and represented by counsel, the plaintiffs would not have had any case against the agency," Gregory writes.
The bulk of Gregory's article is devoted to helping real estate agents avoid creating problems for themselves and their agencies when facing similar situations. The key to doing that is for agents to have a general understanding of the deposition process and the steps that can be taken to reduce the risk of an unfavorable outcome. Some of the points Gregory makes in the article include:
- A deposition is not a "normal" conversation, an assumption often erroneously made by agents being deposed for the first time. This "ritualized interrogation that bears no resemblance to a normal conversation" is a vehicle for the interrogating attorney's not-so-hidden agenda, i.e., to elicit testimony that, taken in or out of context, may bolster his or her client's position. "A deposition offers the deponent little upside, but it often presents significant downside risk," he writes.
- It is highly recommended that agents being deposed meet with their own counsel prior to the deposition to discuss the facts and claims at issue and to review their files. However, the deposition "is not an exam, and there is no need to memorize your file; it is sufficient to refresh your memory by reviewing it," Gregory explains.
- Understand the difference between expert and fact testimony. A fact witness can testify as to what he or she saw, felt, heard, sensed, etc., but is not allowed to provide opinions. An expert witness, on the other hand, can offer his or her opinions.
- Understand the question and answer only that question. Provide short, succinct and honest answers, and never guess, assume or speculate.
Gregory goes on to provide many more practical tips on how agents can prepare for a deposition and conduct themselves during the process in ways most likely to protect themselves and their agencies from undue consequences. "Depositions are important events in the life of a lawsuit," he writes. "While your deposition will not usually 'win' the case for you, it can, at worst, convince the opposing counsel to bring you and/or your agency into the case or, if you are already a party, greatly complicate your position in the case. It cannot be overstated how important it is always to have a lawyer representing you at the deposition."
To read the full article, visit: http://brokeragentsocial.com/article.php?article_id=1131.
Founded in 1988, LeClairRyan provides business counsel and client representation in corporate law and high-stakes litigation. With offices in California, Connecticut, Massachusetts, Michigan, New Jersey, New York, Pennsylvania, Virginia and Washington, D.C., the firm has approximately 325 attorneys representing a wide variety of clients throughout the nation. For more information about LeClairRyan, visit www.leclairryan.com.
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