Texas has strong legal protections for people that are victims of fraud in real estate transactions. Anyone that is cheated in a Texas real estate transaction and that can demonstrate that they suffered damages because someone committed fraud in the context of a real estate transaction is entitled to recover whatever their damages were. Also, they are legally entitled to exemplary damages (frequently called “punitive damages“) as well as their attorney’s fees and many of the costs associated with bringing a real estate fraud claim.
In the event that a licensed real estate agent commits fraud against a person there is relief available. There are very specific and tough laws to ensure that a real estate agent is honest and repays any person of whom they took advantage. The Texas Real Estate Commission takes allegations of fraud against their licensed agents very seriously. In the event that a real estate agent does not have enough money to fix whatever damage that they have done, the Texas Real Estate Commission has a fund to pay out unsatisfied judgments.
Section 27 of the Texas Business and Commerce code provides the remedy for someone that has been cheated in a real estate transaction.
§ 27.01. FRAUD IN REAL ESTATE AND STOCK TRANSACTIONS.
(a) Fraud in a transaction involving real estate or stock in a corporation or joint stock company consists of a (1) false representation of a past or existing material fact, when the false representation is (A) made to a person for the purpose of inducing that person to enter into a contract; and (B) relied on by that person in entering into that contract; or (2) false promise to do an act, when the false promise is (A) material; (B) made with the intention of not fulfilling it; (C) made to a person for the purpose of inducing that person to enter into a contract; and (D) relied on by that person in entering into that contract.
(b) A person who makes a false representation or false promise commits the fraud described in Subsection (a) of this section and is liable to the person defrauded for actual damages.
(c) A person who makes a false representation or false promise with actual awareness of the falsity thereof commits the fraud described in Subsection (a) of this section and is liable to the person defrauded for exemplary damages. Actual awareness may be inferred where objective manifestations indicate that a person acted with actual awareness.
(d) A person who (1) has actual awareness of the falsity of a representation or promise made by another person and (2) fails to disclose the falsity of the representation or promise to the person defrauded, and (3) benefits from the false representation or promise commits the fraud described in Subsection (a) of this section and is liable to the person defrauded for exemplary damages. Actual awareness may be inferred where objective manifestations indicate that a person acted with actual awareness.
(e) Any person who violates the provisions of this section shall be liable to the person defrauded for reasonable and necessary attorney’s fees, expert witness fees, costs for copies of depositions, and costs of court.