Those readers who live in Los Angeles: Take Heed. Do not use Hildegard Merrill (d/b/a Calabassas Realty) -- the self-described "Condo Queen" of the San Fernando Valley-- as your real estate agent. Because, well, yikes.
To use Justice Johnson's (understated) words, the buyer, John Warren, "had all sorts of problems," including Tourette's syndrome, failing faculties, a failing business, a terrible credit rating, and a pending divorce. But he nonetheless wanted to buy a condo, and went to an open house where Ms. Merrill was the agent for the seller.
Ms. Merrill first persuaded him to buy the condo. Fair enough. She then persuaded him that he could not get a mortgage at a reasonable rate, and suggested that because her daughter had okay credit, he should list her as a co-borrower and "technically" buy the house with her, at which point the title would be transferred into Mr. Warren's sole name. Uh, that's fraud. But okay, I guess. If you say so.
But instead of using her daughter asa co-borrower, Ms. Merrill decides to list her as the sole borrower. And, when Ms. Merrill fills out the loan forms for her daughter . . . . well, let me have Justice Johnson tell the story:
Through Charmaine’s and Merrill’s testimony it became apparent Merrill misrepresented the facts when she filled out Charmaine’s loan application. For example, Merrill stated the source of the proposed $77,000 down payment was a combination of savings and gifts [when, in fact, most of it actually came from Warren, and the rest came from her mother] The application stated Charmaine then resided in a condominium at 5800 Kanan Road in Agoura Hills, conducted catering and shuttle businesses out of the residence on Kanan Road, and had been doing so since 2001, earning a monthly income of $7,500 from those businesses. In reality, Charmaine had resided for years in Aspen, Colorado and had never lived at or conducted a business out of the 5800 Kanan Road residence. Also, the businesses Charmaine purportedly conducted had shut down sometime in 1990. Charmaine was instead employed as a waitress in Aspen, Colorado and periodically conducted her shuttle business there. She otherwise relied on her mother for support. Although Merrill indicated on the loan application Charmaine intended the condominium to be her primary residence, the parties’ plan all along was for Warren to live in the condominium instead. As Merrill later conceded in her testimony, she would never have gotten the loan had she been truthful in the loan application. [Footnote]:
The trial court was so alarmed by Merrill’s testimony and her apparent lack of concern about admitting she had committed a form of fraud on the lender, the court recessed the proceedings to permit Merrill to consult with counsel regarding her Fifth Amendment right not to incriminate herself."
Wow. But that ain't all. Then Ms. Merrill bribes her daughter's boyfriend to serve as a middleman to launder the down payment, and has Mr. Warren pay him $2,000 for these services. Then Ms. Merrill steals $6,000 from Mr. Warren by failing to mention that the seller contributed $6,000 to closing costs. Then Ms. Merrill doesn't even put the property into Mr. Warren's name as promised, and instead convinces Mr. Warren to put the property solely in the daughter's name. Then, when Mr. Warren has substance abuse problems and has to go to the Betty Ford clinic, Ms. Merrill evicts him, rendering him homeless and sleeping in the streets. Oh, she also takes all his property in the condo and puts it either into storage or in her own garage, and won't give it back to him; indeed, may even have bought it herself at a "lien sale" in which she was the successful (and likely only) bidder!
Anyway, the trial is a bench trial, and the judge (Judge Kaplan) concludes that Ms. Merrill is a total liar and that there is clear and convincing evidence that she deliberately defrauded Mr. Warren. Judge Kaplan issues an award of $15,000 in noneconomic damages, orders the defendants to transfer the property to Mr. Warren, and imposes punitive damages of $50,000 against Ms. Merrill. (Ms. Merill subsequently stipulates to return Mr. Warren's personal property in return for a dismissal of his conversion and other claims relating to these items). Oh, one more thing. Judge Kaplan awards Mr. Warren his costs and attorney's fees as well.
Does Ms. Merrill sound like the real estate agent you want to have representing you? No, thank you. I'll stick with someone at least marginally reputable, thanks.
I can summarize the final dozen pages of the opinion very quickly. Ms. Merrill appeals. Justice Johnson -- entirely properly -- affirms. And awards Mr. Warren costs on appeal. End of story.
Oh, one last thing. Mr. John Warren? He's the grandson of Earl Warren, former Governor of California and Chief Justice of the United States Supreme Court.
Pretty freaky, eh?
