CAARE conducted an unscientific attorney survey of approximately 100 Minnesota attorneys (click here for the results of that survey). It should be noted that any bias in the study would likely be in favor of dual agency and controlled business because many of the surveys were completed by attorneys who worked at large real estate brokerage or title firms. And the if the results are accurate, our survey may indicate that current investigations into the cause of the mortgage meltdown are misplaced or incomplete.
Residential real estate attorneys could be one of the most important resources for identifying the real problems that led to the mortgage meltdown. As part of their law school and practical training attorneys learn how to identify and resolve conflicts of interest. They are also highly educated in matters concerning fiduciaries. Attorneys have unique training and deeply understand the complexities of representation and why conflicts of interest should be avoided. Their input is very important.
However, it should also be noted that attorneys often do not have "clean hands" when it comes to some of the matters for which we seek their advice. Many have intentionally put substantial conflicts of interest in the way of their real estate consumer representation. Selling title insurance is one problem. In fact, the Minnesota Board of Professional Responsibility recently presented an article about the ethical problems created when attorneys sell title insurance to their clients (Download a pdf of the opinion here: http://www.mncourts.gov/lprb/fc08/fc060208.htm).
Another problem is that many attorneys rely heavily upon Realtors as their referral source. Many have a law practice that includes representation of both home consumers and Realtors. That type of dichotomy in residential legal representation is akin to dual agency - it can't be done. Attorneys who take our survey who practice law with such a conflict are likely to provide us with survey data that defends their position and the inappropriate conflict that they possess.
In the best case, we would love to survey residential real estate attorneys who have none of the conflicts we identify above. However, our limited research seems to indicate that such undivided loyalty to client rights is rare.
Despite the problems of gathering data from attorneys, we still feel that it is important to survey them.
In November, 2008 CAARE surveyed approximately 100 attorneys at the Minnesota Continuing Education's "Real Estate Institute." The results of that survey were extremely valuable in identifying possible causes of the mortgage meltdown that have previously not been considered. The Legal Description, a highly respected national trade journal, by October Research did a story the results: The Legal Description Article. Here are the actual the results of our survey (click here).
Although that survey was not conducted scientifically, we believe that the results are provocative enough to justify a full scale survey to be conducted nationwide. We need funding and assistance to administer such a survey.