The seller of a luxury property in Miami’s Indian Creek Village is suing the real estate brokerage Douglas Elliman (NYSE: DOUG) for not disclosing the buyer of the property was Amazon (NASDAQ: AMZN) founder Jeff Bezos.
According to Wall Street Journal coverage sourced from unnamed “people familiar with the matter,” reported Leo Kryss, the co-founder of the Brazilian toy and electronics company Tectoy, listed his 19,000-square-foot, seven-bedroom property in May 2023 for $85 million. The property is within a gated community nicknamed the “Billionaire Bunker” because of its wealthy residents including Tom Brady, Jared Kushner and Ivanka Trump.
The month after the listing went online, Bezos paid $68 million for a three-bedroom house located next door. Shortly after Bezos’ purchase, Kryss received a $79 million offer.
In a complaint filed in the circuit court of the 11th Judicial Circuit in Miami-Dade County, Kryss asked the brokerage if Bezos was seeking to buy his property. Jay Parker, Elliman’s CEO of the Florida region, called Kryss to claim Bezos was not trying to buy the property, adding the unnamed purchaser would not spend more than $79 million for the property. (Douglas Elliman served as the dual agent on the deal.)
Kryss agreed to sell at a 7.1% discount, but after the transaction was completed he discovered the purchaser was an entity tied to Bezos. Parker claimed after the deal closed that he was unaware of Bezos’ connection to the deal.
Kryss is suing Elliman for the $6 million that he discounted, claiming in his complaint that “it was highly material to his negotiations and his decision on the ultimate sales price…to know whether Bezos was…attempting to anonymously acquire the home in order to assemble it with the adjoining property.”
Kryss’ attorney, Dana Clayton of Akerman, issued a statement that said: “Douglas Elliman failed to fulfill their duties to our client.…They knew or should have known who the ultimate beneficial purchaser was and misrepresented that very important fact to our client.” Neither Douglas Elliman nor Bezos publicly commented on the lawsuit.
Photo courtesy of US Space Force / Wikimedia Commons
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Was Elliman a dual agent or just the listing agent? I think that answer is material.
Yes, Elliman was the dual agent. The article was updated to reflect this. Thanks.
Don’t dial agents owe confidentiality to both buyer and seller
Depends which state – is Florida a fiduciary date
In some states the fiduciary duty defaults on the seller not the buyer
However, he was asked a direct question. This is one for the books! It shouldn’t matter who the client is but dual would make them customers no?? Is their a fiduciary then??
Seller should have done more research, now stomping his feet like a child.
Was Douglas Elliman the brokerage that listed Kryss house? If so then the seller is justified In suing Douglas Elliman. Their fiduciary responsibility is to their client. Jeff Bezos is an extremely wealthy man and that is relevant to the sale of the property. The seller could’ve held out for more money had he known who the purchaser was
Unlike many other states, in Florida there is no Dual Agency. When a Broker represents both parties in a transaction they are Transaction Brokers which is not a fiduciary relationship governed by the laws of Agency. They do not owe all of the duties of a Single Agent, which in Florida is what it is called when they represent one party in a relationship governed by the laws of agency in which fiduciary duties are owed.
Was going to make the same argument, but Transaction Brokerage still requires to deal with all parties honestly.
If asked by the seller and known by the Broker, not answering was dishonest. The Broker is guilty of acting in bad faith. Disclosure was required.
Or, the good old fashioned “I don’t know” if that is in fact the case.
Was the name not on the contract?
Hmmm, I wonder did Elliman sign an exclusive seller agency agreement with the seller first that established “client” agency. If so, then the seller needed to sign and agree to the Transaction Broker agency terms which would have redefined the fiduciary duties owed to the seller by Elliman. I think it depends on what is specified in the agency contract agreement to determine what duties Elliman was required to perform. Nevertheless, this is why many brokers do not allow dual agency. Usually, the seller is client and the buyer is customer to avoid dual agency.
Market price is what a buyer is willing to pay and a seller to accept. Many times, especially in Fl we have LLC’s as purchaser. If the Resltor was acting as a Transaction Broker then he owes “limited” confidentiality to both, seller and buyer.
Someone is very greedy !!!
I sympathize, but also, can’t wait until I can sue someone over $6 million.
So the seller sought to discriminate by verifying the buyer identity? Understandable if the buyer was a sanctioned personage. but it happens all the time in the real world because we are a free open economy.
That was exactly my first thought. He is suing because he wanted to break fair housing laws and discriminate to whom he sold his property. Suing so he could commit a crime. SMH
I’m not sure this falls under the Fair Housing Act because this type of discrimination does not fall under the 7 protected classes – Race, Color, National Origin, Religion, Sex (including gender identity and sexual orientation), Familial Status, and Disability.
So fair market value is an insufficient sales price? They could have counter offered if they wanted to. I don’t see them winning this case.
Fair market value isn’t the issue.
He was opposed to Bezos owning the (his) property and combining it with the property that Bezos had already bought next door. That is a fair reason not to lower the price or sell the property!
Agreed. The seller can always counter if they ultimately wanted more. They’re crying over a lousey 6 million when they got 79 million, talk about greedy.
Whats the problem? He got a price he will wiling to take. Sounds like reverse discrimination to me. Because Bezos is filthy rich is no reason for him to pay anymore than anyone else would..
Correctamundo!
Yeah since when is filthy rich a protected class? The only winners here will be the lawyers. Someone needs a check up from the neck up.
Not Familiar w. FL RE Law or Practices.
If this was Dual Agency? Designated Dual Agency? Or just Seller representation? or were there 2 Separate RE Offices involved?
Bezos is right in trying to keep his name cloaked. I would.
Regardless of his negotiating tactics, the Seller still accepted the price. I’ll be shocked if this goes before a jury prior to settling…
I don’t know the laws there but in texas if our buyers want to remain ominous we have to comply with their request.
No one made the seller agree to the terms, seller agreed to them and is now upset that they sold the property at a discount to one of the riches people in the world. Business is business, if it would have been a “regular person” previous owner would have had no issue!! smdh….
Good reason to say NO to dual agency!
To have answered that question, the broker would have been in a discrimination situation. To condition a sale on who the purchaser is would be VERY wrong.. either you are selling or not selling, and in that price range, the market is very limited
That’s very true ! Good thing they are not in California 😂
👍👍
Let me know how it lands 🙂
Nice problems to have…
I’m surprised Dual Agency is still allowed in some states. This is a perfect example why it shouldn’t …. It’s possible the agent didn’t even know.
This is not Dual Agency, in Florida its Transaction Broker. A transaction broker in Florida provides limited representation to both the buyer and the seller (or landlord and tenant) in a real estate transaction but does not represent either party as a fiduciary or a single agent. Here are the primary responsibilities a transaction broker owes their customers:
Dealing Honestly and Fairly: The broker must conduct themselves in an honest and fair manner with all parties involved in the transaction.
Accounting for All Funds: The broker is responsible for accurately accounting for all funds entrusted to them, such as deposits and escrow payments.
Using Skill, Care, and Diligence: The broker must exercise reasonable skill, care, and diligence in the transaction process, ensuring that all parties are handled professionally.
Disclosing All Known Facts That Materially Affect the Value of Residential Real Property: The broker must disclose to the buyer all known facts that materially affect the value of the property and are not readily observable.
Presenting All Offers and Counteroffers in a Timely Manner: The broker must promptly present all offers and counteroffers to the parties involved, regardless of whether the property is under contract or not.
Limited Confidentiality: The broker must maintain limited confidentiality unless waived in writing by the party. This means the broker cannot reveal any information that could harm the negotiating position of either party. This includes the seller’s willingness to accept a lower price or the buyer’s willingness to pay more, unless otherwise agreed.
Performing Any Additional Duties That Are Mutually Agreed to: The broker is required to perform any additional duties that have been agreed upon with the customer in writing.
Transaction brokers do not owe fiduciary duties, such as loyalty or obedience, as they are considered neutral facilitators in the transaction, representing neither party exclusively.
Spot on!
I would think the seller would have a case, if the broker specifically called the seller to tell him it was not Bezos. That sounds like something a buyer agent would do. It does not seem the Broker treated the seller fairly. If a transaction broker did not owe loyalty to Bezos or the seller, he should have told the seller that he could not disclose if that was the case and asked the seller if he wanted to counter, not called the seller to assure him it was not Bezos, which seems like lying to me.
excerpt from the duties broker owes their customers:
“This means the broker cannot reveal any information that could harm the negotiating position of either party. ”
The seller’s suit stating he would have held out for higher price if he knew it was Bezos proves that disclosing Bezos’ name would have harmed the negotiating position of the buyer.
Limited Confidentiality: The broker must maintain limited confidentiality unless waived in writing by the party. This means the broker cannot reveal any information that could harm the negotiating position of either party. This includes the seller’s willingness to accept a lower price or the buyer’s willingness to pay more, unless otherwise agreed.
“Waived in writing” – It will boil down to what was in writing.
In my opinion it would be discrimination for the Realtor to disclose the Buyers identity! What does it matter who the Buyer is – an offer is an offer and the seller has options to accept, decline or counter !
I’m sure you meant Transaction Broker and not Dual Agent. Florida doesn’t have Dual Agency and the two are very different things.
As I’m sure you all would agree, anyone who could afford to buy the property would likely be in the top 1% of the top 1% earners in America, and by that qualify as “one of the richest people in the world” who could have potentially afforded to pay more for the property if necessary. If there wasn’t a better offer, and the seller was willing to move forward with that offer, then they got fair market value.
Transaction Brokers have two duties – 1) to treat both parties with reasonable skill and care and 2) keep both parties information confidential. Disclosing Bezos’ name would have been a breach of that confidentiality.
Good luck with the lawsuit. I don’t see it going anywhere.
Real estate sellers discriminate among offers, considering price, terms, or other criteria the seller deems important/compelling.
Was the agent required to disclose the buyer’s individual name/identity and intended use of the property? Did the seller request that information from the agent?
In Arizona, a legally binding contract can’t stand on fraud, coercion or deception by omission, among other things.
Bottom line: Use Independent Representation anytime your rights/preferences matter!!
A great buyers agent has VALUE
Dual agency is extremely dangerous. Great for the agent because they’re double dipping. Bad for the buyer and seller. The agent is representing no-one but themselves. I stopped doing that 15 years ago because of the potential liability
Agree 👍 Me too
The Fact Jay Parker Got Involved Raises The “Bar” So to Speak! He Should Testify Under Oath WHY He Got Involved in the Sale (what did he actual know and when did He know it)? Also, I’m Very Curious If DE Was Involved in the Prior Sale Next Door? Seller Seams More Concerned (Should Be) Not About Whom the Actual Buyer Was, Yet the Fact Buyer Was Attempting to Combine the TWO Properties, Which Would Affect the Value of Subject Positively, Regardless of Name (in property assembling, sometimes 1+1=2.5)
I think the point is that the buyer didn’t want to pay more and that was notated. Even if he could he wouldn’t end of story . So that fact they are banking that he would have paid more would need to be proven .
That might be hard to do – it’s could’ve would’ve situation.
When I first read the headline I thought “the agent has no duty to disclose who his client is,” but then reading the story I kind of see the seller’s position even if it’s greed-motivated. He’s willing to accept $79m, but if he knows the buyer is one of the richest men in the world and perceives having leverage over him as he wants conjoining properties, then he wants to bilk him for more.
Even though seller is admittedly taking advantage of a situation, I do believe he has a legitimate point as Bezos likely would have paid a little more than another buyer. And he went to the broker of the agents to ask and was allegedly lied to. I don’t believe the broker didn’t know. Don’t say “it’s not Bezos” if you don’t know it isn’t.
If the sellers agent was asked if Bezos was the buyer, the agent can say”I’m not at liberty to say”. They cannot lie and say he is not the buyer. the seller will win this lawsuit. As Realtors we are held to a higher standard. We must alway be truthful.
Seller has a good case. Agent knew, he lied he didn’t know. Also buyer bezos bot home nxt door, all the more reason seller should have known who buyer is. Dual agency is tricky & agent should have exhibited honesty, fairness & transparency. This is the kind of thing that gives realtors a bad wrap.