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HOUSTON-A general corporate survey, spearheaded by Fulbright & Jaworski LLP, has revealed some interesting facts about the commercial real estate industry. The average real estate company faces 39 litigation actions, only five of which they initiated.

Steve Carroll, a partner with Fulbright & Jaworski, says the other surprising fact is, by far, the main types of lawsuits against real estate companies involve personal injury. “When they talk about personal injury, I think that would mean slips and falls, with someone injured,” he tells GlobeSt.com, adding injuries on construction sites could be adding to the number of lawsuits for the category. “You’d think that with real estate companies, the main issues they’d deal with are contract and labor disputes. But it’s interesting to me that personal injury comprises the largest segment of lawsuits.”

The survey itself generated 354 responses, with 5% of the respondents being real estate companies. Of these companies, Carroll notes, 14% indicated they spent more than 5% of their gross revenues on their legal budget whereas 20% indicated that between 2% and 5% of their legal budget ended up going toward legal issues. The survey also revealed that the overwhelming area of concern for real estate firms involves environmental and toxic tort issues.

Carroll, who handles litigation for many real estate companies, says the good news is a high percentage of cases are dismissed. “Seventy-five percent of those responding said between three-quarters and 99% of the suits are settled before trial whereas 17% indicated that all their cases were settled before reaching trial.” Eight percent of those surveyed end up in trial, he adds.

Carroll says the findings point to a positive trend in litigation. “This means a vast majority of lawsuits aren’t going to trial, meaning real estate companies seem more interested in resolving the issue, rather than taking a chance on trial,” he says. “That will hopefully be the continued trend in litigation–is that fewer and fewer of these suits go to trial.”

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