Need an expert
on the National Realtor Code of Ethics? Are your state's Real
Estate License Laws relevant?
To help distinguish
between the duties of Real Estate Brokers and Realtors, it is
important to understand that, while all Realtors are licensees, not all
licensees are Realtors. Realtors are licensees who have
optionally elected to join the National Association of Realtors (NAR) through
membership in a local Board of Realtors.
As a condition of
their membership, Realtors in every state swear to support the NAR'S "Code of Ethics".
For the purpose you are visiting today, "Realtor Ethics" is defined by
me
as reflecting strictly those behaviors and conduct addressed in the Code,
which
is published annually by the NAR. To read the Code in a new
window, click HERE
By virtue of this, Realtors
throughout the United States are subject to an additional layer of guidelines that serve to
supplement those laid down by the licensing statute in their home states. However,
it is my understanding that courts in several states will look to the Code as
the standard of conduct expected of all licensees -- both Realtors and
unaffiliated.
There are two NAR-mandated
functions at the local Board level.
-
The role of the
Grievance Committee is somewhat like that of a Grand Jury, which filters both complaints
against agents and brokers, and arbitration requests. Occasionally Larry personally prosecuted complaints at a hearing on behalf
of either the
Grievance Committee itself or of a Complainant who is unable to attend or
is not entirely competent to proceed. This additional function is
permitted by NAR policy.
-
As for the
Professional Standards Committee, its role is to establish hearings
where sworn testimony is heard and evidence is presented for examination
and review by a panel of three Realtors. Upon conclusion of a hearing, the
panelists vote on the charges and we either find for dismissal of the
charges or agreement with at least one of them. If the latter, the
panel immediately determines appropriate one or more disciplines from a
list established by the National Association of Realtors.
-
Professional Standards
panels also conduct arbitration hearings to determine which broker is procuring cause in a closed transaction and thus due the contested
real estate commission.
Realtor ethics are unique.
They are distinct from business
and attorney ethics, although there is
some overlap. For example, a Realtor can cheat a vendor and
not breach any of the Code's ethical standards. But instead, if the victim is
a customer or another Realtor, then the Realtor may be guilty of
violating the Code of Ethics.
Many people are surprised to find out
that a similar distinction applies to serious crimes such as armed robbery
and dealing illegal drugs. These activities are not addressed by any article of
the Code.
Believe it or not, there are
also ethical complaints about
Realtors based upon allegations
of alienation of affection.
Realtors swear to abide by the Code, and
typically learn its principles during their initial
indoctrination. Most Realtors proudly adhere to the Code of Ethics
throughout their entire careers in the business, but some occasionally fail
to live up to its standards because of ignorance or laziness or
greed or mental lapses resulting in another party's financial loss or
physical injury.
But ignorance, laziness, greed, and mental lapses
do not apply solely to Realtors in troubled real estate transactions. The principal parties -- buyers, sellers, landlords, & tenants -- are
equally susceptible to these human frailties. So when damages are claimed
and a suit is filed, it's often critical to determine if the Realtor's
conduct conformed to ethical standards...or strayed from them.
Florida Statutes...and
beyond.
Licensed as a
Broker in Florida, Larry helps attorneys with Florida Statutes
475, 61J2, and 455 and their practical interpretation.
Luckily for Larry, the licensing
rules in most states are very
similar, so he has agreed to
help attorneys and principals
in ten more states across the U.S.
In a typical
lawsuit, a licensee's conduct is measured against both state law and the
Code of Ethics. It is possible that a course of conduct may be legal
but unethical, while another may be illegal but not unethical. (To read FS 475 in a new window, click
HERE )
That is why you are
here, now, reading this. Larry Lowenthal will help you find the
answer to questions such as
"Was the Realtor's
conduct ethical?" "Was it legal?" "Was
it malpractice?" "Did it meet the standard of care?" "Who earned the
commission?" |