Court Held That Real Estate Broker Did Not Owe Fiduciary Duties To Other Parties In A Transaction

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In Van Duren v. Chife, the buyers of a home sued the sellers as well as the sellers’ real estate broker and his company regarding water penetration that damaged the home. No. 01-17-00607-CV, 2018 Tex. App. LEXIS 3494 (Tex. App.—Houston [1st Dist.] May 17, 2018, no pet. history). The trial court dismissed the buyers’ breach of fiduciary duty claim against the sellers’ agent. The court of appeals affirmed on that issue and held:

The existence of a fiduciary duty is an element of a claim for breach of fiduciary duty. First United Pentecostal Church of Beaumont v. Parker, 514 S.W.3d 214, 220 (Tex. 2017). Real estate brokers owe a fiduciary duty to their clients. See Birnbaum, 2015 Tex. App. LEXIS 8775, 2015 WL 4967057, at *10 (citing 22 Tex. Admin. Code § 531.1). While brokers also must treat other parties to a transaction fairly, this obligation does not make the broker a fiduciary of these other parties whom he does not represent. See Kubinsky v. Van Zandt Realtors, 811 S.W.2d 711, 715 (Tex. App.—Fort Worth 1991, writ denied) (realtors’ fiduciary duties ran to sellers they represented in transaction). The evidence establishes that Mathews was the Chifes’ real estate broker with respect to the Royal Lakes home sale and that another broker, Lofton, represented the Van Durens. The Royal Lakes contract identifies Mathews and Lofton as the brokers for the sellers and buyers respectively. Gesare testified that Mathews represented her and her husband in connection with the sale of the Royal Lakes home. Sonya likewise testified that Mathews represented the Chifes in this transaction. There is no contrary evidence in the record. Mathews met his burden to conclusively negate the existence of a fiduciary duty, a necessary element of the Van Durens’ claim for breach of fiduciary duty against him with respect to the Royal Lakes home sale. We therefore hold that the trial court properly granted summary judgment in favor of Mathews and his company on this claim.

Id.

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