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Can Taylor Swift ‘Shake Off’ a Real Estate Lawsuit Gone Horribly Wrong?

Taylor Swift may know how to belt out hits, but can she “shake off” a real estate deal that landed her management team in a million-dollar lawsuit?

Real estate brokerage Douglas Elliman is suing three firms representing the pop star—Firefly Entertainment, 13 Management, and Euro Tribeca—for breach of contract. The point of dispute: Real estate agent Andrew Azoulay claims that these companies had given him a “written exclusive promise” to buy Swift a particular New York property through him, but then ended up closing the deal with a different unnamed agent in October.

Azoulay is seeking a $1,080,000 settlement—a sum that would cover, among other things, the 6% commission he would have been paid had Swift’s team stuck with him.

So what happened? According to court documents, Azoulay had started working with Swift’s management team in December 2016, showing them a property first at 15 Leonard St., followed by one at 153 Franklin St.—a 5,148-square-foot townhouse in Manhattan’s Tribeca neighborhood that was not on the market, but happened to be right next door to a property that Swift reportedly owns and lives in already.

Azoulay claims he received an email from the Firefly Entertainment/13 Management team saying they would work “solely” with him to purchase this property.

Yet in March 2017, Azoulay claims that Swift’s team ceased all communications with him. At first he assumed that Swift had decided she didn’t want the place. But seven months later, he learned that her company Euro Tribeca had indeed purchased the property with another broker. On Jan. 25, Azoulay filed his complaint in court.

What Taylor Swift can teach us about switching real estate agents

Granted, Swift herself isn’t accused of wrongdoing, rather it’s the people working on her behalf. Still, shouldn’t she, as someone who owns quite a sizable portfolio of properties, have someone hypervigilant handling these deals?

“This is a recurring problem with famous and wealthy clients,” says Los Angeles–based real estate developer Tyler Drew.

“Often, they do not wish to advertise a move or purchase to keep ahead of the press and paparazzi. They often use middlemen to purchase houses, and so communication problems happen.”

How this legal drama will unfold is anyone’s guess at this point, but it nonetheless contains an important lesson for all home buyers—namely, about the importance of having a buyer’s agreement in place so that everyone’s on the same page about payment if a real estate deal comes to pass.

“When a buyer is engaging an agent to look at homes and ultimately purchases a property, a buyer’s agency agreement can be put in place that binds the home buyer to working with a specific brokerage and agent for an agreed-upon length of time,” says Cara Ameer, a real estate agent in Florida. “However, the problem is that use of buyer’s agency agreements varies from city to city, and is not typically done on a consistent basis.”

So why aren’t these contracts just par for the course? Because home buyers may not want to sign them—and agents may not want to pressure them to do so.

“It can be dicey because not every buyer is comfortable signing such a form,” Ameer continues. “What if they have just met the agent in a casual setting, as is often the case—such as at an open house—and are just starting their search? Using this form could scare off a buyer and lose a prospect that an agent could have worked with had they not insisted on them signing the form.”

And so, to play it safe, many agents don’t push these agreements and, instead, rely on less formal expressions of a buyer-agent commitment—like, say, emails, much like Azoulay is using as evidence in his case.

But do emails count as a legally binding contract? Some say yes.

“Any agreement in real estate must be in writing, but the courts have found that emails can form the basis for a contract related to broker agreements,” says Robert Pellegrini, a real estate attorney in Boston. As such, even without signing a buyer’s agreement, “Swift would have wanted to revoke any statements that may have resembled an agreement or a promise. Generally, whenever you can be upfront, communicative, and fair and reasonable, you will protect yourself from a lawsuit.”

“The take-home for home buyers is ‘get it in writing,’” says Mindy Jensen, a real estate agent and author of the book “How to Sell Your Home.” “The contract should have an end date, as well as the type of property you are looking for.” This not only wards off costly miscommunications, but also helps buyers in another important way: “In many states, unless you have a specific buyer’s agency agreement signed with your agent, they are actually required to work on behalf of the seller,” Jensen adds.

So what happens if your agent turns into a huge flake, and you want to break things off?

“If you’re unable to get in touch with the agent—and there are agents who do not provide proper service like not returning phone calls in a timely manner or even at all—then you have reason to use someone else,” Jensen says. “But make your intentions clear—don’t go around them.”

Or else, like Swift, you could end up facing a whole new type of bad blood.

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