Question: When Perry Olsen died his children placed his ranch in

When Perry Olsen died, his children placed his ranch in Vail, Colorado, for sale. Perry's children retained Vail Associates Real Estate, a real estate broker, to sell the land for them. Vail Associates introduced the children to Magnus Lindholm, who wanted to buy Perry's ranch along with adjacent land owned by Perry's children. The children eventually decided to sell only Perry's ranch and not the children's land. Their asking price for Perry's ranch was $400 per acre. Before committing to buying Perry's ranch (because he needed more land), Lindholm asked Vail Associates to introduce him to Del Rickstrew, whose land also abutted Perry's ranch. Rickstrew refused to negotiate the sale through a real estate agent, so Lindholm negotiated directly with Rickstrew. Vail Associates did, however, introduce Rickstrew to Lindholm and provide a model contract to Lindholm.
A month later, Lindholm agreed to buy Rickstrew's land for $6,000 per acre, subject to his buying Perry's ranch also. Vail Associates was not aware that Lindholm and Rickstrew had a contract or that the price was $6,000 per acre. Two months later, with Vail Associates' assistance, the children sold Perry's ranch to Lindholm for $400 per acre. Vail Associates received a commission from the sale. When the children discovered later that Rickstrew received 15 times as much for his acreage as did they for Perry's ranch, they sued Vail Associates for failing to disclose material information, that is, that Lindholm was negotiating with Rickstrew. Did Vail Associates breach a fiduciary duty?

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  • CreatedJuly 16, 2014
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