|
REAL ETHICS by Steve Stazel | July 2007 | Index of all Real Ethics columns
Does your client have a prior exclusive agreement?
Article 16 of the Code of Ethics tells us in three places that we have an obligation to determine whether our prospect has entered into an exclusive agreement with another REALTOR®. Standards of Practice 16-9, 16-13, & 16-14 all relate to this obligation.
SOP 16-9 states that “REALTORS®, prior to entering into a representation agreement, have an affirmative obligation to make reasonable efforts to determine whether the prospect is subject to a current, valid exclusive agreement to provide the same type of real estate service.”
SOP 16-13 states that “Before providing substantive services (such as writing a purchase offer or presenting a CMA) to prospects, REALTORS® shall ask prospects whether they are a party to an exclusive representation agreement, REALTORS® shall not knowingly provide substantive services concerning a prospective transaction to prospects who are parties to exclusive representation agreements, except with the consent of the prospects’ exclusive representatives or at the direction of the prospects.”
SOP 16-14 states that “REALTORS® are free to enter into contractual relationships or to negotiate with sellers/landlords, buyers/tenants or others who are not subject to an exclusive agreement but shall not knowingly obligate them to pay more than one commission except with their informed consent.”
You may have noticed that SOP 16-13 states that we can write a contract for/with a prospect who is subject to an exclusive agreement with another broker AT THE DIRECTION OF THE PROSPECT. If this should ever happen to you, the first thing I would suggest you do is to encourage the prospect to contact their broker. If the prospect says no to that suggestion and still wants your assistance, I suggest there are at least three things you will want to obtain in writing signed by the prospect. First that the prospect understands they may be financially obligated to the other broker; second, who you represent (or don’t represent); and third, that the prospect initiated contact with you.
As I have stated in previous columns, I think we should ask prospects, “Are you working with another broker?” rather than “Have you signed an exclusive agreement?” By asking if the prospect is working with anyone else, I think you are saying you will RESPECT THE RELATIONSHIP the other broker has created regardless of whether it is Agency or T.B. But remember...this paragraph consists of my thoughts and not necessarily those of the Code.
Each month, the Aurora Association of REALTORSŪ Web site features Real Ethics,
a column by Steve Stazel devoted to explaining Code of
Ethics issues for members. A REALTORŪ since 1974, Stazel is a Professional Standards
instructor and senior Ethics
instructor for the Colorado Association of REALTORSŪ.
If you have an ethical concern or an issue you would like
to see addressed, please call Stazel at (303) 773-3333 or e-mail him at
stazels@msn.com. The comments of this article reflect the understanding and
opinions of the author and do not represent an official expression of policy by the National Association
of REALTORSŪ.
|
