Chris Cortazzo (Credit: chriscortazzo.com)
In November 2016, the California Supreme Court ruled that a real estate brokerage representing the buyer and seller in the same deal has the same fiduciary responsibility to both parties. That decision in Horiike v. Coldwell Banker stemmed from a 2012 lawsuit, whose appeal has only now gone to trial.
The case centers around Coldwell Banker agent Chris Cortazzo, who in 2007 helped broker the sale of a $12.5 million Malibu mansion to Chinese millionaire Hiroshi Horiike. Chizuko Namba of Coldwell Banker represented Horiike, while Cortazzo, also with Coldwell Banker, represented the seller, Denis Brown.
After closing on the property, Horiike alleged that Cortazzo and Coldwell Banker wildly exaggerated the property’s square footage. He lost his case in 2012, then appealed two years later. The Supreme Court’s ruling, which could have far-reaching implications about how information is shared in so-called dual agency transactions, did not decide the merits of Horiike’s case itself.
The trial now taking place in LA County Superior Court will determine whether the brokerage and broker breached their fiduciary responsibility. The plaintiff is seeking damages in the neighborhood of $7 to $8 million, according to the firm representing him, Reuben Raucher & Blum.
Cortazzo, who testified on March 28, said he verbally disclosed any square footage discrepancies to Horiike during property tours, according a court transcript obtained by TRD. The plaintiff’s lawyer pressed Cortazzo on why he advertised the square footage as “15,000 square feet of living areas” on a property brochure when public records list the property at 11,050 square feet with 9,434 square feet of living area.
“I’m still confused as to what living area means,” Cortazzo replied. “I think there are so many different ways to discuss living area, so I don’t [know.]”
Cortazzo also acknowledged listing a different square footage than the one found on public records roughly for about 10 percent of the “thousands of listings” he said he’s had in his 23-year career, according to the transcript. When plaintiff inquired if he had sold all of these listings, Cortazzo quipped, “don’t underestimate me.”
Cortazzo did not respond to requests for comment.
Witness testimony is wrapping up, and the jury is expected to begin deliberations later this week.
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