Legal FAQs for REALTORS®
— Professional Standards
Respecting Another Broker’s Agency Relationship
After my listing expired, the owner listed his home with another REALTOR® in our area. Someone I showed the property to when I was the listing broker has now expressed an interest in having me present an offer on this home. Since I previously showed the property to this buyer while my listing was active, can I deal directly with the owner I used to represent, or must I submit any offer to the new listing broker? (Updated May 14, 2014)
The fact that you previously listed this property for the seller and showed this buyer the property does not permit you to contact the owner directly.
Under the Real Estate License Act, a licensee may deliver an offer directly to an owner who is exclusively represented by another broker only if the owner’s broker consents to the delivery and a copy of the offer is sent to the owner’s broker. Any negotiations of the offer must still be conducted through the owner’s broker.
In addition, Standard of Practice 16-13 in the REALTOR® Code of Ethics provides that all dealings concerning property exclusively listed shall be carried on with the client's broker and not with the client, except with consent of the client's broker or where such dealings are initiated by the client.
Since the owner in this situation is now represented by a new broker, you should deal with the new broker concerning any offer a buyer might want to present.
I’m the property manager for a home in an up-and-coming neighborhood. The property owner said a REALTOR® in his neighborhood convinced him it’s a good time to put the house on the market, with her as the listing agent, after our property-management agreement ends in April. I also list homes, and I have an existing relationship with the homeowner. Is the other REALTOR® violating the Code of Ethics by contacting my client? (updated Jan. 19, 2015)
No. Although Article 16 of the NAR Code of Ethics prohibits REALTORS® from engaging in any practice or taking any action inconsistent with exclusive representation or exclusive brokerage relationship agreements that REALTORS® have with clients, Standard of Practice 16-3 allows REALTORS® to contact the client of another broker to provide a service different than what is currently being provided, or to offer the same type of service for property not subject to a broker’s current exclusive agreements. If you are offering property-management services, another broker can provide brokerage services to sell the same property without risking violating Article 16. And if your owner had two properties and you only managed one, another broker could provide property-management services for the home you don’t have an exclusive agreement for.
However, information received through an MLS or any other offer of cooperation may not be used to target clients of other REALTORS®. In your situation, the other REALTOR® did not use these methods, and is therefore not in violation of the Code.
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