January 13, 2026
Source: Saiber's Real Estate Litigation Alert
As New Jersey real estate brokers and agents move through another competitive residential market cycle, disputes are still an unfortunate reality of doing business. These claims can occur when a transaction falls apart, a buyer alleges nondisclosure of a defect in a property, or a seller claims mishandling of the listing.
Many of these claims are weak, untrue, and fully defensible, and brokers should not immediately assume that litigation is something to be feared or avoided at all costs. However, even when the claims are weak, untrue and totally defensible, there is a real cost to brokers and agents who have to defend themselves. They have to allocate time to gathering documents, meeting with their attorneys, and generally spending time that they could otherwise use to market properties, service clients, and close deals.
For that reason, one of the most effective strategies for brokers and agents facing residential real estate claims is to strategically focus on the potential of an early resolution, ideally before a lawsuit is filed, or as early as possible after one is filed. Early resolution is decidedly not about conceding liability or avoiding a fight, it is often about positioning the broker or agent to resolve a matter on favorable terms or, where appropriate, to litigate from a position of strength. The goal is not just to prepare to substantively defend the case, but to explore if there is a way to resolve it efficiently, reduce legal spending, and avoid prolonged disruption to business operations. Some of the most practical early resolution tools are summarized below.
Pre-Suit Resolution Strategy: Control the Narrative Before Litigation Starts
Many broker and agent disputes begin with a demand letter or email references potential claims like misrepresentation, failure to disclose, negligence, or breach of fiduciary duty. The pre-suit phase is often the best chance to resolve the matter because positions have not yet hardened and litigation costs have not yet escalated. Handled correctly, this stage can also set the tone for an aggressive and effective defense if the matter does proceed to formal litigation.
In practical terms, early pre-suit strategy should include:
- Immediately preserving key documents including: email communications, text messages, the transaction file, and the seller disclosure documents.
- Developing a clear timeline of what happened and what was communicated.
- Working with legal counsel to determine how to best respond to the demand letter or email and requesting that the claimant identify the specific conduct and their alleged damages.
- Positioning the matter for early mediation or settlement discussions, where appropriate.
A disciplined approach at this early stage often prevents a weak claim from turning into an expensive lawsuit or strengthens the broker or agent’s defense if litigation is unavoidable.
Direct Negotiation and Mediation: The Most Effective Tools to Resolve Disputes Early
Working with legal counsel to determine whether initiating an effort to resolve the dispute pre-suit is often the best approach. Legal counsel can evaluate the claimant’s position, discuss the relative legal risk, if any, to the broker or agent, and can help to craft a response that either deters further action or opens a dialogue toward resolution. This response could come in the form of a letter back to the claimant explaining why their demand is meritless or could come in the form of a request to set up a call to discuss a potential resolution. Used properly, these steps can narrow issues, expose weaknesses in a claimant’s case, and shift leverage early.
Mediation is frequently the best early resolution option for residential real estate disputes because it is private, efficient, and designed to reach business solutions rather than prolonged litigation outcomes. Importantly, mediation can be used pre-suit or very early in a case, including before depositions, expert reports, and extensive discovery drive costs upward.
Early mediation tends to be most effective when brokers:
- Select a mediator with real estate and litigation experience;
- Come prepared with key documents and a concise factual narrative; and
- Focus on risk exposure and litigation cost while remaining prepared to proceed with a formal defense if a resolution cannot be reached.
For many brokers, mediation also allows settlement terms that protect the most important business interests, including confidentiality, non-disparagement, and a broad release of claims.
Aggressive Early Motion Practice: A Strategic Option for Legally Weak Claims
While mediation or early resolution is often the preferred path, it is not appropriate in every case. There are situations where early motion practice can resolve a dispute or significantly narrow it before litigation becomes expensive. If a claim is poorly pleaded, contradicted by written disclosures, barred by legal defenses, or filed primarily as leverage, a targeted early motion can potentially force a dismissal of part or all of the claim, narrow the scope of discovery, or meaningfully shift settlement leverage.
The value of early motion practice is that it can reduce both exposure and the scope of discovery, two factors that often determine whether a broker can resolve a case early and cost-effectively.
Cost-Control Measures: Keep Litigation Proportional to the Business Risk
Even when early resolution is the goal, legal costs can escalate quickly if the matter is not managed deliberately. Brokers should insist on a strategy that prioritizes efficiency without sacrificing defense leverage, including:
- Establishing an early budget and litigation roadmap.
- Designating one internal point of contact to streamline document collection and communication.
- Focusing litigation activity on steps that either advance resolution or strengthen the broker’s litigation position.
This type of cost discipline is essential to prevent a dispute from becoming a prolonged operational distraction.
The above serves as a brief overview of how brokers can position themselves to resolve residential real estate disputes efficiently while remaining fully prepared to litigate when claims lack merit or demand an aggressive response. Please contact Michael Shortt at Saiber LLC if you have any questions about the best approach to resolving a pre-suit claim or residential real estate lawsuit efficiently.
