Whether an agent”s statements about the property are of such a character as to “reasonably induce” someone to act to their detriment is the key to understanding false advertising claims. Part of that understanding is the difference between misleading facts and “puffing.” Puffing is said to be “sales talk.” That is, an expression of opinion by a sales person about the product they are selling. At common law, it was thought that no reasonable person, considering the source, would rely on a sales person”s opinion. Puffing was, therefore, not actionable as misrepresentation or false advertising.
Modern real estate practices limit the value of the “puffing” distinction. Statutory duties requiring honesty to all parties have seriously undermined “puffing” as a defense to misrepresentation claims. Agents who represent buyers are not engaged in selling at all, so “puffing” is not involved when a buyer”s agent is talking to the buyer. There are also Fair Housing laws that limit the use of puffing in advertising. Click Here for a detailed explanation of Fair Housing laws.
On the listing side of the deal, it is still important to distinguish fact from opinion, but whether something is “truthful and not misleading” is measured by its effect on potential buyers, not whether it is just factually correct. For example, consider the following ad language: “Great five acres, 20 miles from town. Modern three bedroom house in charming landscaped setting.” There are some facts in the ad (five acres, 20 miles, three bedrooms, landscaped) and some opinion (great, modern and charming). This manner of advertising is susceptible to false advertising claims because it qualifies fact with opinion.
Qualifiers do not negate the over-all impression left by the ad. It is the overall impression people rely on, not ambiguous qualifiers like “charming.” In fact, the ambiguity of the qualifiers actually hurts because if the overall impression is misleading, the qualifiers are evidence that it was deliberately so. If the property turns out to be 4.6 acres of mostly wetland 31 miles from town with a cheaply remodeled twenty-years-old house that has new bark dust in the flower beds that border the freshly mowed crabgrass yard, the qualifiers just aren”t going to help. If you want to “puff,” don”t mix opinion and fact, just offer opinion. For example: “Nice small acreage country charmer.” After all, all you want out of advertising is a call to request details.