Occupy Montague Street? Would-be Buyer Protests Corcoran’s Business Practices

This afternoon David Huber set up signs and handed out leaflets in front of the Corcoran real estate office at Montague and Henry streets, telling any passers by with the time and curiosity to listen about his frustration in dealing with the large real estate broker. In a nutshell, he says Corcoran showed him a studio apartment he liked, he signed a contract, arranged for a mortgage, and incurred out-of-pocket expenses preparing to buy, but after three months learned that the apartment lacked a required certificate of occupancy. At this time, he said, the Corcoran agent “quickly wished me goodbye.”

Mr. Huber then asked Corcoran’s local managing director if the company would reimburse him for the expenses he had incurred in connection with the busted deal. Her response, he said, was to say that, under New York law, real estate transactions are governed by the principle of caveat emptor (buyer beware), which means that the burden was on Mr. Huber to inquire about the certificate of occupancy. “What do you want me to do?” the Corcoran executive asked rhetorically. Huber concedes that she was correct in her statement of the law, but questions whether it is a good business practice to apply that principle to cases like his. “[S]hould real estate be a high-risk game of obfuscation and obstruction?” he asks. He then makes the serious accusation that the Corcoran agent “recommended that I lie on a federal mortgage application (a felony) in order to make the sale”.

Huber has a website devoted to his beef with Corcoran. He also invites people with “Corcoran horror stories” to send them to him at mycorcoranhorrorstory@gmail.com

We’d be glad to publish Corcoran’s side of the story if they give it to us.

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  • Tarekp

    I’m sure many will agree with the ‘buyer beware’ argument. Laws are laws after-all. But I side with David. We have created a society built around specialization and paying for the expertise of one’s specialty. Be it in law, car mechanics or real-estate, we pay for the intelligence of another in an area we do not know or have the time to learn.

    If they weren’t thorough in their performance and take up the ‘buyer beware,’ defense, then I fully support his grievance and hope the company and others like it recognize the importance of a great customer experience…

  • Local Realtor

    David, I am sorry, that you have to go through this. I wonder why, she did not mention to you from the start that a Certificate of Occupancy was not in place. I hope that you will make good use of your time and consult with an attorney. It is not easy to find ethical people to deal with – I can’t imagine withholding pertinent information from my client and then telling him about the law that protects me. Everything should have disclosed at the start of the relationship. Good that you are doing something about it. I can’t help but wonder if she knew? Maybe the seller neglected to inform her?
    Best of luck,
    Realtor

  • DownOnCorcoran

    I had an unpleasant situation with Corcoran myself, this same local office, when I rented on Love Lane (a $100,000+/year rental, mind you). We were lied to on a matter that was very material to us. When we complained, we were basically told, Hey, those the breaks.
    My revenge was more commercial in nature: I used another agent when I bought in One Brooklyn Bridge. So, it cost them a fatter juicier commission.
    I envy this young guy’s passion and idealism and, well, free time.

  • David on Middagh

    I spoke with him. He had laid out several thousand dollars when this fiasco occurred. He is demonstrating at different Corcoran offices around the city. His own agent was from Fort Greene. He is wondering if there is bad behavior through the whole chain–DownOnCorcoran’s experience would be another data point to suggest there may be–and would like to hear anyone else’s horror story.

    I told him I’d sworn never to use Corcoran after the Montague office expanded into the John’s Pizza space. That is a special corner location best used for hungry people watchers, *not* office operations.

  • GHB

    Yeah, the law’s the law, blah, blah, blah. A broker, supposedly a professional, should have seen to it that everything was in order. That’s why they’re paid a commission. But why did Huber set up shop at the Heights office if his broker was in Fort Greene? I’m sure you can find stories from all the Corcoran offices, but he should go after his local broker and the main office, but not this one.

  • DrewB

    When were looking to move to the heights we had a TERRIBLE experience with that Corcran office that ended with the Manager calling my wife at work and trying to intimidate her into making a bigger offer on a property. They were rude, condescending and overly aggressive. I always tell people to steer clear of them.

  • Gerry

    I doubt that the salesperson or the broker knew that the listing had NO CofO and yes they should know it is their job to know but this has become a profession of lazy, dumb, and dishonest people.

    The boker never would have taken the listing if they knew about the C of O problem.

    But how did a buyer get a mortgage without a C of O? A bank will not finace anything that has no C of O?

    Something is missing here we do not have the whole story.

  • Peter Goldstein

    Corcoran is really NRT Realogy, the own all the worst companies who preach over promise and under deliver. I wish i had a nickel everytime one of these corcoran agents told me they were so good because their site get so many hits and they can sell anything. Then he comes back a few weeks later telling me his estimates were wrong and now we have to lower. OH, i thought your website was visited by high profile buyers all over the world? And you can get me the price i wanted? Lies, told just to get my listing. They are full of it, all of these big corporate brokerages only care about profit. I miss the days of a local housed broker, When did brooklyn heights get so commercial? I thought the area was supposed to support mom and pop based businesses.

  • DrewB

    If you click through to this site you’ll see a post about him being threatened by the husband of Corcoran Vice President Merele Williams-Adkins. I’m pretty sure this is the same woman that harassed by wife on the phone.

    We ended up buying through Brooklyn Landmark Real Estate on Montague. They were helpful, friendly and seemed to be working in our best interest. I liked that they had a real connection to the neighborhood.

    Though I have not used them myself, Brown Harris Stevens has sold a few units in our building over the years. In my dealings with their brokers they seem very professional, and reasonable.

  • zburch

    A correction to DrewB…we used Brown Harris, they were good. Corcoran showed us an apartment that we liked, we made a bid on it, they pressed us to turn around our stuff crazy fast (within a few days) then told us it was already under contract with another buyer a few days later and our bid was denied. Disgusted I went to Brown Harris. 2 weeks later I get a call from Corcoran telling me that the original deal fell through. I told them we had found something else we liked better in the meantime. Melinda from Corcoran (at the Brooklyn Heights office) called me at my office and berated me and said I could not rescind my offer. She was offensive and completely out of line. We found out later, the original bid was less than ours, so they manufactured a board refusal of the first buyer so they could get our higher price.

    We had another run in with them when we were thinking about a move to Red Hook. I saw a property I liked that they listed as a live/work house. I later found out it was zoned Manufacturing, NOT residential, therefore illegal to actually live there. When I pressed the agent about it, she totally lied about it. I went to the city and they said there was little chance of them changing the zoning. I am disgusted by that company and their unethical business practice, everyone should beware!! They completely take advantage of the emotional state people are in when making such a big purchase, and lie, cheat and bully to get the most $ out of you.

  • Tony

    The whole point of a broker is to be a middleman between the buyer and the seller; otherwise, what is the point of them? Corcoran should have done their homework and made sure the apartment they were selling had a C of O. That’s a pretty fundamental thing. I wish this man luck and admire his pluckiness.

  • Topham Beauclerk

    Tony, the the estate agent as honest broker between buyer and seller belongs to the category of how things ought to be. How they are is that brokers are shills for the seller whose property is the occasion of their fee.

  • renee rapley

    a little knowledge being a dangerous thing. Especially when other people read misinformation and potentially rely on it when making decisions.”
    Including your misinformation. “Guest” is 100% correct in that it is the buyer’s ATTORNEY who is to blame, NOT the seller’s broker.
    In New York, ALL residences are required to have a C of O, period. The C of O is not typically part of a simple title report, but is easily accessable on line from the department of buildings. Any attorney who isn’t brain dead would check with the departmnent of buildings FIRST, to see any recent violations and make sure the building is up to code. Dave’s attorney obviously had never worked on a brownstone sale before.
    Dave’s attorney was hired by, and worked for Dave, and should have acted in his best interest. The Broker was hired by, and was working for the seller (check your department of state guidelines on “Agency”). The fault is solely on the attorney’s shoulders, Dave just sees that Corcoran has more money, and might settle out of court to make him go away.
    If I was Corcoran’s parent company, I’d counersue Dave and his attorney

  • Donald

    Renee – question for you. Is it legal to offer real estate for sale even though it is not transferable (ie it doesn’t have a c of o in this case)?

  • Tony

    @Renee: The broker has no responsibility to see to it that the apartment he is offering to a buyer is a legal one? The whole idea of a broker is to serve as a mediator between two parties. If one side is not playing fair, the broker should know about this. You have an awfully low threshold for business ethics, it seems.

  • shamrock

    @ renee rapley, you seem well informed, but not so sure everything you’re saying is entirely accurate either. Perhaps a little bit of “misinformation” on your part too(??). Is it safe to assume that “Dave just sees that Corcoran has more money, and might settle out of court to make him go away”? I’m guessing there must be more to this story; certainly would like to hear a response from Corcoran on the matter.

  • Eddyenergizer

    renee rapley, Not all buildings are required to have a c of o. This is from the buildings department website:

    Buildings Built Before 1938
    If a building was constructed before 1938 and there has been no change in use or additions to the property, it may not have a Certificate of Occupancy.

    http://home2.nyc.gov/html/dob/html/applications_and_permits/co_factsheet.shtml

  • Voice of Reason

    Renee hit the nail on the head.

    Based on the information written in the original post, the fault lies entirely with Mr. Huber’s lawyer who is hired explicitly to protect his client’s interests and review all the documentation. It is his/her responsibility to check this very item, (Certificate of Occupancy), for every single transaction they do.

    This should have been caught by Mr. Huber’s lawyer during the routine due diligence performed BEFORE the contract was signed and any money was spent by Mr. Huber. This research is preformed irrespective of anything said, promised or done by any evil broker, seller, friend, relative, “expert” or man on the street. This is exactly why lawyers are required for the transaction, and this is their job.

    All real estate brokers are independent contractors. They work for themselves. There are good ones and bad ones. Was this broker malfeasant? Maybe, maybe not. Mr. Huber clearly thinks so, but again, that’s why buyers have lawyers; to protect against misinformation, whether intended or not.

    Mr. Huber had a horrible experience, and I wouldn’t think of accusing him of looking for “deep pockets” based only on information from a heated blog post, but I would certainly recommend that he seek out a competent real estate attorney to represent him in future transactions,

  • David on Middagh

    @R.R.: I understood from talking to Mr. Huber that both he and the seller were represented by brokers, each from Corcoran. You would hope that the buyer’s brokerage firm would have the buyer’s back.

  • http://selfabsorbedboomer.blogspot.com Claude Scales

    I have the impression that Mr. Huber was not represented by an attorney. He doesn’t mention it anywhere in his story.

  • http://www.youtube.com/watch?v=UlsiLOnWCoI Arch Stanton

    This is what happens to these kids who grew up sheltered and coddled, they come to the big city and get ripped off for the first time. They are so shaken by the event, they cannot wrap their pea heads around it. Oh boo hoo.

  • Knight

    It could be that the attorney (if Mr. Huber had one) is not to blame and that it was the attorney whose diligence actually uncovered the lack of a CofO. Perhaps the attorney’s fees constitute the expenses that Mr. Huber claims to have incurred. Still too many missing pieces of information for my taste.

  • http://Www.buyersedgerealty.com Gary Herbst

    It is very important to know who Corcoran was the agent for. As of January 1, 1992 all real estate agents in New State have been required to inform all prospective buyers and sellers of the different types of agents and agency relationships, including a seller’s agent, a buyer’s agent, a broker’s agent, and a dual agent. However, real estate agents in New York City have not been required to use this Agency Disclosure Form until January 1, 2011- this year!!!

    By default, if a real estate agent (the agent is the entire company, not an individual licensee in the firm) does not sign the state agency disclosure form as a buyer’s agent, that agent by default is a traditional seller’s agent. Before buyer’s agency in the mid 1980′s all real estate companies by law were seller’s agents with legal duties to work for the best interests of the home seller, not the buyer, including negotiating for the highest possible price at the best possible terms for sellers. Seller agents cannot disclose any information to a buyer that would undermine the seller’s ability to negotiate the highest price at the best terms possible. If a seller’s agent disclosed information to an unrepresented buyer customer, that agent would be acting illegally as an undisclosed dual agent, which is illegal in every state in the US.

    Buyers would be well served to understand the different types of real estate agency options available and the duties each type of agent has to their respective client. Agents representing their respective clients, whether buyer or seller, are accountable for their actions. If Corcoran was representing Mr. Huber as a buyer’s agent, the info about the C.O. should have been disclosed to Mr. Huber if they knew if or discovered it at some point in their due diligence process. If they were a seller’s agent, it would be up to Mr. Huber to discover it, hopefully thru his attorney.

    Oran was representing Mr. Huber as

  • Tony

    @Arch Stanton: Your comment is very childish. You know nothing of Mr. Huber’s background, so why speculate?

  • Rguy

    I’m sort of confused here. I understand the C of O but don’t buyers in new construction usually sign contracts when the building doesn’t have a TCO yet? That’s pretty much what everyone does in new construction when they’re in their sales phase.

    Wouldn’t he have just waited until the building got it’s TCO and then went to closing?

    I feel like there’s a lot of missing details here? Anyone know any more?

  • Knight

    Rguy: I think the key word is that the apartment didn’t have a “valid” CofO. Any time major changes are made to an apartment (not necessarily to the whole building), a new CofO needs to be issued. My take was that there was construction done on the place and no new CofO was issued afterward.

  • http://www.youtube.com/watch?v=UlsiLOnWCoI Arch Stanton

    Dear Tony, did I hit a nerve? You seem a bit sensitive on the issue, perhaps you relate to my hypothesis? Anyway, What I said was more of a general commentary on; the current social malaise of young people having difficulty adjusting to the real world, once they leave mommy and daddy’s swaddle.

  • PJL

    Typically, broker for a property sale acts as seller’s agent (unless agreed otherwise) and seller pays commission; worth bearing in mind…..

    Sounds like/usually C of O delivery is a requirement per Contract of Sale/seller couldn’t deliver, so attorney might not be at fault–Mr. Huber isn’t claiming that his downpayment wasn’t returned in accordance with Contract, is he?

  • Gerry

    How did this guy get a mortgage without a C of O someone please explain that to me?

  • http://Www.buyersedgerealty.com Gary Herbst

    A C of O Would be required if issuance was included in the contract as a contingency by the buyer’s attorney, which is the seller’s responsibility to obtain. The lender would condition the issuance of a loan commitment subject to the seller obtaining a CO From the municipality’s building department. The title company does not check for C.O.’s. A good listing agent may report that a C.O has been filed by the seller and report it in the listing sheet. Otherwise, a buyer’s agent or the buyer’s attorney can check the Tax Assessor’s Property Card inventory and compare to the physical improvements which actually exist, and uncover any discrepancies.