Mario Juarez is running for the Oakland City council. He is also being investigated for numerous cases of alleged real estate fraud. Mario and Hilda Bucio are among the candidate’s many accusers. The couple claims they gave a loan to Mr. Juarez for $210,000 to help build a biodiesel plant in the city. But that the plan never materialized and the money was never returned to them. Pedro Oropeza, another accuser, alleges that he handed Mr. Juarez $20,000 in exchange for the candidate’s help in opening a sports bar. A year later, nothing has happened and the money has disappeared. Mr. Juarez has refused to comment on the allegations, saying merely that he won't comment on ongoing litigation.
While the above accusations seem to be cut-and-dried allegations of fraud, they are excellent examples of what happens when deals are made with a handshake instead of a legal contract. Potential hazards in commercial real estate deals can be avoided by consulting an experienced lawyer. Some of the more common problems are:
- Construction defects
- Misrepresentation of the size or the number of units in a proposed building
- Title and deed issues
- Failure to follow building codes
- Failure to file for required building permits
These are a small sampling of the problems that can occur when commercial real estate transactions are arranged without the benefit of legal counsel. Until a few years ago, California commercial real estate transactions were strictly governed by the rule of caveat emptor or, let the buyer beware. Nowadays, California’s strict disclosure laws compel the seller to reveal information about real estate. The best way to protect yourself in these cases is to work with an experienced commercial real estate attorney who understands California’s business climate and its laws. Failing to do so is asking for trouble, as Mr. Juarez’s alleged victims learned the hard way.