|
REAL ETHICS by Steve Stazel | March 2009 | Index of all Real Ethics columns
REALTOR® competence includes knowing pertinent facts
The National Association of REALTORS® offers many case studies to help us better interpret the Code of Ethics.
What follows is one which I think you will find interesting.
REALTOR® A showed his new $500,000 listing to Buyer B. In discussion, the buyer observed that some kind of construction was beginning on property located nearby. He asked REALTOR®A what it was. “I really don’t know,” said REALTOR® A, “but I believe it’s the attractive new shopping center that has been planned for this area.” Following the purchase, Buyer B learned that the new construction was to be a bottling plant and that the adjacent area was zoned industrial.
Charging that the proximity of the bottling plant would have caused him to reject purchasing the home, Buyer B filed an ethics complaint charging REALTOR® A with a violation of Article 2, which states in part that: “REALTORS® shall avoid exaggeration, misrepresentation, or concealment of pertinent facts relating to the property or the transaction.”
During the hearing, REALTOR® A stated he had given an honest answer to Buyer B’s question. At the time he had no positive knowledge about the new construction. He knew that other developers were planning an extensive shopping center in the general area and had simply ventured a guess. He pointed out, as indicated in Buyer B’s testimony, that he had prefaced his response by saying he didn’t know the answer to Buyer B’s question.
The ethics panel did not find REALTOR® A’s defense adequate. REALTOR® A was found guilty of a violation of Article 2. The panel found that REALTOR® A’s expected competence required him to know the answer to a question related to a pertinent fact or, if he didn’t know the answer, he shouldn’t have ventured a guess but should have made a commitment to get the answer.
Any material fact that could affect a reasonable purchaser’s decision to purchase, or the price that a purchaser might pay, should be disclosed. The question that hearing panels should consider in determining whether a REALTOR® has exaggerated, misrepresented, or concealed a pertinent fact is whether disclosure of the fact in question could have had an effect on a reasonable purchaser’s decision.
Each month, the Aurora Outlook features RealEthics, a column by Steve Stazel devoted to explaining Code of Ethics issues for members. The comments stated in this article are those of the author and do not necessarily represent the views of the National Association of REALTORS®, the Colorado Association of REALTORS® or the Aurora Association of REALTORS®. Ultimately, a hearing panel of the Professional Standards Committee determines whether a violation of the Code of Ethics has occurred on a case-by-case basis. These comments should not serve as the foundation of any ethics complaint, arbitration request or response.
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.
|
