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Where the word REALTORS® is used in this Code and Preamble,
it shall be deemed to include REALTOR-ASSOCIATE®S.
While the Code of Ethics establishes obligations that may be higher
than those mandated by law, in any instance where the Code of
Ethics and the law conflict, the obligations of the law must take
precedence.
PREAMBLE....
Under all is the land. Upon its wise utilization and widely allocated ownership
depend the survival and growth of free institutions and of our civilization.
REALTORS® should recognize that the interests of the nation and its
citizens require the highest and best use of the land and the widest distribution
of land ownership. They require the creation of adequate housing, the building
of functioning cities, the development of productive industries and farms, and
the preservation of a healthful environment.
Such interests impose obligations beyond those of ordinary commerce. They impose
grave social responsibility and a patriotic duty to which REALTORS®
should dedicate themselves, and for which they should be diligent in preparing
themselves. REALTORS®, therefore, are zealous to maintain and improve
the standards of their calling and share with their fellow REALTORS®
a common responsibility for its integrity and honor.
In recognition and appreciation of their obligations to clients, customers,
the public, and each other, REALTORS® continuously strive to become
and remain informed on issues affecting real estate and, as knowledgeable professionals,
they willingly share the fruit of their experience and study with others. They
identify and take steps, through enforcement of this Code of Ethics and by assisting
appropriate regulatory bodies, to eliminate practices which may damage the public
or which might discredit or bring dishonor to the real estate profession. REALTORS®
having direct personal knowledge of conduct that may violate the Code of Ethics
involving misappropriation of client or customer funds or property, willful
discrimination, or fraud resulting in substantial economic harm, bring such
matters to the attention of the appropriate Board or Association of REALTORS®
.
Realizing that cooperation with other real estate professionals promotes the
best interests of those who utilize their services, REALTORS® urge exclusive
representation of clients; do not attempt to gain any unfair advantage over
their competitors; and they refrain from making unsolicited comments about other
practitioners. In instances where their opinion is sought, or where REALTORS®
believe that comment is necessary, their opinion is offered in an objective,
professional manner, uninfluenced by any personal motivation or potential advantage
or gain.
The term REALTOR® has come to connote competency, fairness, and high
integrity resulting from adherence to a lofty ideal of moral conduct in business
relations. No inducement of profit and no instruction from clients ever can
justify departure from this ideal.
In the interpretation of this obligation, REALTORS® can take no safer
guide than that which has been handed down through the centuries, embodied in
the Golden Rule, “Whatsoever ye would that others should do to you, you
ye even so to them.”
Accepting this standard as their own, REALTORS® pledge to observe its
spirit in all of their activities and to conduct their business in accordance
with the tenets set forth below.
DUTIES TO CLIENTS AND CUSTOMERS
ARTICLE 1 (Amended 1/93)
When representing a buyer, seller, landlord, tenant, or other client as an
agent, REALTORS® pledge themselves to protect and promote the interests
of their client. This obligation of absolute fidelity to the client’s interests
is primary, but it does not relieve REALTORS® of their obligation to
treat all parties honestly. When serving a buyer, seller, landlord, tenant or
other party in a non-agency capacity, REALTORS® remain obligated to
treat all parties honestly.
Standard of Practice 1-1 (Amended 1/93)
REALTORS® when acting as principals in a real estate transaction,
remain obligated by the duties imposed by the Code of Ethics.
Standard of Practice 1-2 (Adopted 1/95, Amended 1/99)
The duties the Code of Ethics imposes are applicable whether REALTORS®
are acting as agents or in legally recognized non-agency capacities
except that any duty imposed exclusively on agents by law or regulation
shall not be imposed by this Code of Ethics on REALTORS® acting
in non-agency capacities.
As used in this Code of Ethics, “client” means the
person(s) or entity(ies) with whom a REALTOR® or a REALTOR®’s
firm has an agency or legally recognized non-agency relationship;
“customer” means a party to a real estate transaction
who receives information, services, or benefits but has no contractual
relationship with the REALTOR® or the REALTOR®’s
firm; “agent” means a real estate licensee (including
brokers and sales associates) acting in an agency relationship
as defined by state law or regulation; and “broker”
means a real estate licensee (including brokers and sales associates)
acting as an agent or in a legally recognized non-agency capacity.
Standard of Practice 1-3
REALTORS®, in attempting to secure a listing, shall not deliberately
mislead the owner as to market value.
Standard of Practice 1-4 (Amended 1/93)
REALTORS®, when seeking to become a buyer/tenant representative,
shall not mislead buyers or tenants as to savings or other benefits
that might be realized through use of the REALTOR®’s
services.
Standard of Practice 1-5 (Adopted 1/93)
REALTORS® may represent the seller/landlord and buyer/tenant
in the same transaction only after full disclosure to and with
informed consent of both parties.
Standard of Practice 1-6 (Adopted 1/93, Amended 1/95)
REALTORS® shall submit offers and counter-offers objectively
and as quickly as possible.
Standard of Practice 1-7 (Adopted 1/93, Amended 1/95)
When acting as listing brokers, REALTORS® shall continue to
submit to the seller/landlord all offers and counter-offers until
closing or execution of a lease unless the seller/landlord has
waived this obligation in writing. REALTORS® shall not be
obliged to continue to market the property after an offer has
been accepted by the seller/landlord. REALTORS® shall recommend
that sellers/landlords obtain the advice of legal counsel prior
to acceptance of a subsequent offer except where the acceptance
is contingent on the termination of a pre-existing purchase contract
or lease.
Standard of Practice 1-8 (Adopted 1/93, Amended 1/99)
REALTORS® acting as agents of buyers/tenants shall submit to buyers/tenants
all offers and counter-offers until acceptance but have no obligation to continue
to show properties to their clients after an offer has been accepted unless
otherwise agreed in writing. REALTORS® acting as agents or brokers of
buyers/tenants shall recommend that buyers/tenants obtain the advice of legal
counsel if there is a question as to whether a pre-existing contract has been
terminated.
Standard of Practice 1-9 (Adopted 1/93, Amended 1/99)
The obligation of REALTORS® to preserve confidential information (as
defined by state law) provided by their clients in the course of any agency
relationship or non-agency relationship recognized by law continues after termination
of agency relationships or any non-agency relationships recognized by law. REALTORS®
shall not knowingly, during or following the termination of professional relationships
with their clients:
- 1) reveal confidential information of clients; or
- 2) use confidential information of clients to the disadvantage of clients;
or
- 3) use conficential information of clients for the REALTOR®’s
advantage or the advantage of third parties unless:
- a) clients consent after full disclosure; or
- b) REALTORS® are required by court order; or
- c) it is the intention of a client to commit a crime and the information
is necessary to prevent the crime; or
- d) it is necessary to defend a REALTOR® or the REALTOR®’s
employees or associates against an accusation of wrongful conduct.
Standard of Practice 1-10 (Adopted 1/95, Amended 1/00)
REALTORS® shall, consistent with the terms and conditions
of their real estate licensure and their property management
agreement, competently manage the property of clients with due
regard for the rights, safety and health of tenants and others
lawfully on the premises.
Standard of Practice 1-11 (Adopted 1/95)
REALTORS® who are employed to maintain or manage a client’s
property shall exercise due diligence and make reasonable efforts
to protect it against reasonably foreseeable contingencies and
losses.
Standard of Practice 1-12 (Adopted 1/93, Renumbered 1/98, Amended 1/99)
When entering into listing contracts, REALTORS® must advise
sellers/landlords of: 1) the REALTOR®’s general company
policies regarding cooperation with and compensation to subagents,
buyer/tenant agents, and or brokers acting in legally recognized
non-agency capacities; 2) the fact that buyer/tenant agents or
brokers, even if compensated by the listing brokers or by the
sellers/landlords may represent the interests of buyers/tenants;
and 3) any potential for the listing brokers to act as a disclosed
dual agents, e.g. buyer/tenant agents.
Standard of Practice 1-13 (Adopted 1/93, Renumbered 1/98, Amended 1/99)
When entering into buyer/tenant agreements, REALTORS® must
advise potential clients of: 1) the REALTOR®’s general
company policies regarding cooperation and compensation; and 2)
any potential for the buyer/tenant representative to act as a
disclosed dual agent, e.g. listing broker, subagent, landlord’s
agent, etc.
ARTICLE 2 (Amended 1/00)
REALTORS® shall avoid exaggeration, misrepresentation,
or concealment of pertinent facts relating to the property or
the transaction. REALTORS® shall not, however, be obligated
to discover latent defects in the property, to advise on matters
outside the scope of their real estate license, or to disclose
facts which are confidential under the scope of agency or non-agency
relationships as defined by state law.
Standard of Practice 2-1 (Amended 1/96)
REALTORS® shall only be obligated to discover and disclose
adverse factors reasonably apparent to someone with expertise
in those areas required by their real estate licensing authority.
Article 2 does not impose upon the REALTOR® the obligation
of expertise in other professional or technical disciplines.
Standard of Practice 2-2
(Renumbered as Standard of Practice 1-12 1/98)
Standard of Practice 2-3
(Renumbered as Standard of Practice 1-13 1/98)
Standard of Practice 2-4
REALTORS® shall not be parties to the naming of a false consideration
in any document, unless
it be the naming of an obviously nominal consideration.
Standard of Practice 2-5 (Adopted 1/93)
Factors defined as “non-material” by law or regulation
or which are expressly referenced in law or regulation as not
being subject to disclosure are considered not “pertinent”
for purposes of Article 2.
ARTICLE 3 (Amended 1/94)
REALTORS® shall cooperate with other brokers except when
cooperation is not in the client’s best interest. The obligation
to cooperate does not include the obligation to share commissions,
fees, or to otherwise compensate another broker.
Standard of Practice 3-1 (Amended 1/99)
REALTORS®, acting as exclusive agents or brokers of seller/landlords,
establish the terms and conditions of offers to cooperate. Unless
expressly indicated in offers to cooperate, cooperating brokers
may not assume that the offer of cooperation includes an offer
of compensation. Terms of compensation, if any, shall be ascertained
by cooperating brokers before beginning efforts to accept the
offer of cooperation.
Standards of Practice 3-2 (Amended 1/94)
REALTORS® shall, with respect of offers of compensation to
another REALTOR®, timely communicate any change of compensation
for cooperative services to the other REALTOR® prior to
the time such REALTOR® produces an offer to purchase/lease
the property.
Standard of Practice 3-3 (Adopted 1/94)
Standard of Practice 3-2 does not preclude the listing broker
and cooperating broker from entering into an agreement to change
cooperative compensation.
Standard of Practice 3-4 (Amended 1/94)
REALTORS®, acting as listing brokers, have an affirmative
obligation to disclose the existence of dual or variable rate
commission arrangements (i.e. listings where one amount of commission
is payable if the listing broker’s firm is the procuring
cause of sale/lease and a different amount of commission is payable
if the sale/lease results through the efforts of the seller/landlord
or a cooperating broker). The listing broker shall, as soon as
practical, disclose the existence of such arrangements to potential
cooperating brokers and shall, in response to inquiries from cooperating
brokers, disclose the differential that would result in a cooperative
transaction or in a sale/lease that results through the efforts
of the seller/landlord. If the cooperating broker is a buyer/tenant
representative, the buyer/tenant representative must disclose
such information to their client.
Standard of Practice 3-5 (Amended 1/93)
It is the obligation of subagents to promptly disclose all pertinent
facts to the principal’s agent prior to as well as after
a purchase or lease agreement is executed.
Standard of Practice 3-6 (Adopted 5/86)
REALTORS® shall disclose the existence of an accepted offer
to any broker seeking cooperation.
Standard of Practice 3-7 (Amended 1/95)
When seeking information from another REALTOR® concerning
property under a management or listing agreement, REALTORS®
shall disclose their REALTOR® status and whether their interest
is personal or on behalf of a client and, if on behalf of a client,
their representational status.
Standard of Practice 3-8 (Amended 11/87)
REALTORS® shall not misrepresent the availability of access
to show or inspect a listed property.
ARTICLE 4 (Amended 1/00)
REALTORS® shall not acquire an interest in or buy or present
offers from themselves, any member of their immediate families,
their firms or any member thereof, or any entities in which they
have any ownership interest, any real property without making
their true position known to the owner or the owner’s agent
or broker. In selling property they own, or in which they have
any interest, REALTORS® shall reveal their ownership or interest
in writing to the purchaser or the purchaser’s representative.
Standard of Practice 4-1 (Adopted 2/86)
For the protection of all parties, the disclosures required by
Article 4 shall be in writing and provided by REALTORS® prior
to the signing of any contract.
ARTICLE 5
REALTORS® shall not undertake to provide professional services
concerning a property or its value where they have a present or
contemplated interest unless such interest is specifically disclosed
to all affected parties.
ARTICLE 6 (Amended 1/99)
REALTORS® shall not accept any commission, rebate, or profit
on expenditures made for their client, without the client’s
knowledge and consent.
When recommending real estate products or services (e.g., homeowner’s
insurance, warranty programs, mortgage financing, title insurance,
etc.), REALTORS® shall disclose to the client or customer
to whom the recommendation is made any financial benefits or fees,
other than real estate referral fees, the REALTOR® or REALTOR®’s
firm may receive as a direct result of such recommendation.
Standard of Practice 6-1 (Amended 5/88)
REALTORS® shall not recommend or suggest to a client or a
customer the use of services of another organization or business
entity in which they have a direct interest without disclosing
such interest at the time of the recommendation or suggestion.
ARTICLE 7 (Amended 1/93)
In a transaction, REALTORS® shall not accept compensation
from more than one party, even if permitted by law, without disclosure
to all parties and the informed consent of the REALTOR®’s
client or clients.
ARTICLE 8
REALTORS® shall keep in a special account in an appropriate
financial institution, separated from their own funds, monies
coming into their possession in trust for other persons, such
as escrows, trust funds, clients’ monies, and other like
items.
ARTICLE 9
REALTORS®, for the protection of all parties, shall assure
whenever possible that agreements
shall be in writing, and shall be clear and understandable language
expressing the specific terms, conditions, obligations and commitments
of the parties. A copy of each agreement shall be furnished to
each party upon their signing or initialing.
Standard of Practice 9-1 (Amended 1/93)
For the protection of all parties, REALTORS® shall use reasonable
care to ensure that documents pertaining to the purchase, sale,
or lease of real estate are kept current through the use of written
extensions or amendments.
DUTIES TO THE PUBLIC
ARTICLE 10 (Amended 1/00)
REALTORS® shall not deny equal professional services to
any person for reasons of race, color, religion, sex, handicap,
familial status or national origin. REALTORS® shall not be
parties to any plan or agreement to discriminate against a person
or persons on the basis of race, color, religion, sex, handicap,
familial status, or national origin.
REALTORS®, in their real estate employment practices, shall
ot discriminate against any person or persons on the basis of
race, color, religion, sex handicap familial status, or national
origin.
Standard of Practice 10-1
REALTORS® shall not volunteer information regarding the racial,
religious or ethnic composition of any neighborhood and shall
not engage in any activity which may result in panic selling.
REALTORS® shall not print, display or circulate any statement
or advertisement with respect to the selling or renting of a property
that indicates any preference, limitations or discriminations
based on race, color, religion, sex, handicap, familial status
or national origin.
Standard of Practice 10-2 (Adopted 1/00)
As used in Article 10 “real estate employment practices”
relates to employees and independent contractors providing real-estate
realted services and the administrative and clerical staff directly
supporting those individuals.
ARTICLE 11 (Amended 1/95)
The services which REALTORS® provide to their clients and
customers shall conform to the standards of practice and competence
which are reasonably expected in the specific real estate disciplines
in which they engage; specifically, residential real estate brokerage,
real property management, commercial and industrial real estate
brokerage, real estate appraisal, real estate counseling, real
estate syndication, real estate auction, and international real
estate. REALTORS® shall not undertake to provide specialized
professional services concerning a type of property or service
that is outside their field of competence unless they engage the
assistance of one who is competent on such types of property
or service, or unless the facts are fully dis-closed to the client.
Any persons engaged to provide such assistance shall be so identified
to the client and their contribution to the assignment should
be set forth.
Standard of Practice 11-1 (Amended 1/96)
The obligations of the Code of Ethics shall be supplemented by
and construed in a manner consistent with the Uniform Standards
of Professional Appraisal Practice (USPAP) promulgated by the
Appraisal Standards Board of the Appraisal Foundation.
The obligations of the Code of Ethics shall not be supplemented
by the USPAP where an opinion or recommendation of price or pricing
is provided in pursuit of a listing, to assist a potential purchaser
in formulating a purchase offer, or to provide a broker’s
price opinion, whether for a fee or not.
Standard of Practice 11-2 (Adopted 1/95)
The obligations of the Code of Ethics in respect of real estate
disciplines other than appraisal shall be interpreted and applied
in accordance with the standards of competence and practice which
clients and the public reasonably require to protect their rights
and interests considering the complexity of the transaction, the
availability of expert assistance, and where the REALTOR®
Standard of Practice 11-3 (Adopted 1/96)
When REALTORS® provide consultative services to clients which
involve advice or counsel for a fee (not a commission), such advice
shall be rendered in an objective manner and the fee shall not
be contingent on the substance of the advice or counsel given.
If brokerage or transaction services are to be provided in addition
to consultative services, a separate compensation may be paid
with prior agreement between the client and REALTORS®.
ARTICLE12 (Amended 1/93)
REALTORS® shall be careful at all times to present a true
picture in their advertising and repre-
sentations to the public. REALTORS® shall also ensure that
their professional status (e.g. broker, appraiser, property manager,
etc.) or status as REALTORS® is clearly identifiable in any
such advertising.
Standard of Practice 12-1 (Amended 1/97)
REALTORS® may use the term “free” and similar terms
in their advertising and in other representations provided that
all terms governing availability of the offered product or service
are clearly disclosed at the same time.
Standard of Practice 12-2 (Amended 1/97)
REALTORS® may represent their services as “free”
or without cost even if they expect to receive
compensation from a source other than their client provided that
the potential for the REALTORS® to obtain a benefit from a
third party is clearly disclosed at the same time.
Standard of Practice 12-3 (Amended 1/95)
The offering of premiums, prizes, merchandise discounts or other
inducements to list, sell, purchase, or lease is not, in itself,
unethical even if receipt of the benefit is contingent on listing,
selling, purchasing, or leasing through the REALTOR® making
the offer. However, REALTORS® must exercise care and candor
in any such advertising or other public or private representations
so that any party interested in receiving or otherwise benefiting
from the REALTOR®’s offer will have clear, thorough,
advance understanding of all the terms and conditions of the offer.
The offering of any inducements to do business is subject to
the limitations and restrictions of state law and the ethical
obligations established by any applicable Standard of Practice.
Standard of Practice 12-4 (Amended 1/93)
REALTORS® shall not offer for sale/lease or advertise property
without authority. When acting as listing brokers or as subagents,
REALTORS® shall not quote a price different from that agreed
upon with the seller/landlord.
Standard of Practice 12-5 (Adopted 11/86)
REALTORS® shall not advertise nor permit any person employed
by or affiliated with them to advertise listed property without
disclosing the name of the firm.
Standard of Practice 12-6 (Amended 1/93)
REALTORS®, when advertising unlisted real property for sale/lease
in which they have an ownership interest, shall disclose their
status as both owners/landlords and as REALTORS® or real estate
licensees.
Standard of Practice 12-7 (Amended 1/96)
Only REALTORS® who participated in the transaction as the
listing broker or cooperating broker (selling broker) may claim
to have “sold” the property. Prior to closing, a cooperating
broker may post a “sold” sign only with the consent
of the listing broker.
ARTICLE 13
REALTORS® shall not engage in activities that constitute
the unauthorized practice of law and shall recommend that legal
counsel be obtained when the interest of any party to the transaction
requires it.
ARTICLE14 (Amended 1/99)
If charged with unethical practice or asked to present evidence
or to cooperate in any other way, in any professional standards
proceeding or investigation, REALTORS® shall place all pertinent
facts before the proper tribunals of the Member Board or affiliated
institute, society, or council in which membership is held and
shall take no action to disrupt or obstruct such processes.
Standard of Practice 14-1 (Amended 1/95)
REALTORS® shall not be subject to disciplinary proceedings
in more than one Board of REALTORS® or affiliated institute,
society or council in which they hold membership with respect
to alleged violations of the Code of Ethics relating to the same
transaction or event.
Standard of Practice 14-2 (Amended 1/92)
REALTORS® shall not make any unauthorized disclosure or dissemination
of the allegations, findings or decision developed in connection
with an ethics hearing or appeal or in connection with an arbitration
hearing or procedural review.
Standard of Practice 14-3 (Adopted 11/87, Amended 1/99)
REALTORS® shall not obstruct the Board’s investigative
or professional standards proceedings by instituting or threatening
to institute actions for libel, slander or defamation against
any party to a professional standards proceeding or their witnesses
based on the filing of an arbitration request, an ethics complaint,
or testimony given before any tribunal.
Standard of Practice 14-4 (Adopted 11/88)
REALTORS® shall not intentionally impede the Board’s
investigative or disciplinary proceedings by filing multiple ethics
complaints based on the same event or transaction.
DUTIES TO REALTORS®
ARTICLE15 (Amended 1/92)
REALTORS® shall not knowingly or recklessly make false
or misleading statements about competitors, their business, or
their business practices.
Standard of Practice 15-1 (Adopted 1/00)
REALTORS® shall not knowingly or recklessly file false or
unfounded ethics complaints.
ARTICLE 16 (Amended 1/98)
REALTORS® shall not engage in any practice or take any
action inconsistent with the agency or other exclusive relationship
recognized by law that other REALTORS® have with clients.
Standard of Practice 16-1 (Adopted 1/93, Amended 1/95)
Article 16 is not intended to prohibit aggressive or innovative
business practices which are otherwise ethical and does not prohibit
disagreements with other REALTORS® involving commission, fees,
compensation or other forms of payment or expense.
Standard of Practice 16-2 (Amended 1/93)
Article 16 does not preclude REALTORS® from making general
announcements to prospective clients describing their services
and the terms of their availability even though some recipients
may have entered into agency agreements or other exclusive relationships
with another REALTOR®. A general telephone canvass, general
mailing or distribution addressed to all prospective clients in
a given geographical area or in a given profession, business,
club, or organization, or
other classification or group is deemed “general” for
purposes of this standard. (Amended 1/98)
Article 16 is intended to recognize as unethical two basic types
of solicitations:
First, telephone or personal solicitations of property owners
who have been identified by a real estate sign, multiple listing
compilation, or other information service as having exclusively
listed their property with another REALTOR®; and
Second, mail or other forms of written solicitations of prospective
clients whose properties are exclusively listed with another REALTOR®
when such solicitations are not part of a general mailing but
are directed specifically to property owners identified through
compilations of current listings, “for sale” or “for
rent” signs, or other sources of information required by
Article 3 and Multiple Listing Service rules to be made available
to other REALTORS® under offers of sub-agency or cooperation.
Standard of Practice 16-3 (Amended 1/93)
Article 16 does not preclude REALTORS® from contacting the
client of another broker for the purpose of offering to provide,
or entering into a contract to provide, a different type of real
estate service unrelated to the type of service currently being
provided (e.g. property management as opposed to brokerage).
However, information received through a Multiple Listing Service
or any other offer of cooperation may not be used to target clients
of other REALTORS® to whom such offers to provide services
may be made.
Standard of Practice 16-4 (Amended 1/94)
REALTORS® shall not solicit a listing which is currently listed
exclusively with another broker. However, if the listing broker,
when asked by the REALTOR®, refuses to disclose the expiration
date and nature of such listing; i.e. an exclusive right to sell,
an exclusive agency, open listing, or other form of contractual
agreement between the listing broker and the client, the REALTOR®
may contact the owner to secure such information and may discuss
the terms upon which the REALTOR® might take a future listing
or, alternatively, may take a listing to become effective upon
expiration of any existing exclusive listing.
Standard of Practice 16-5 (Adopted 1/94, Amended 1/98)
REALTORS® shall not solicit buyer/tenant agency agreements
from buyers/tenants who are subject to exclusive buyer/tenant
agency agreements. However, if asked by a REALTOR®, the broker
refuses to disclose the expriation date of the exclusive buyer/tenant
agency agreement, the REALTOR® may contact the buyer/tenant
to secure such information and may discuss the terms upon which
the REALTOR® might enter into future buyer/tenant agreement
or, alternatively, may enter into a buyer/tenant agreement to
become effective upon the expiration of any existing exclusive
buyer/tenant agreement.
Standard of Practice 16-6 (Amended 1/98)
When REALTORS® are contacted by the client of another REALTOR®
regarding the creation of an exclusive relationship to provide
the same type of service, and REALTORS® have not directly
or indirectly initiated such discussions, they may discuss the
terms upon which they might enter into a future agreement or,
alternatively, may enter into an agreement which becomes effective
upon expiration of any existing exclusive agreement.
Standard of Practice 16-7 (Amended 1/93)
The fact that a client has retained a REALTOR® as an agent
in one or more past transactions does not preclude other REALTORS®
from seeking such former client’s future business.
Standard of Practice 16-8 (Amended 1/98)
The fact that an exclusive agreement has been entered into with
a REALTOR® shall not preclude or inhibit any other REALTOR®
from entering into a similar agreement after the expiration of
the prior agreement.
Standard of Practice 16-9 (Amended 1/98)
REALTORS®, prior to entering into an agency agreement or
other exclusive relationship, have an affirmative obligation to
make reasonable efforts to determine whether the client is subject
to a current, valid exclusive agreement to provide the same type
of real estate service.
Standard of Practice 16-10 (Amended 1/98)
REALTORS®, acting as agents of, or or in another relationship
with, buyers or tenants, shall disclose that relationship to
the seller/landlord’s agent or broker at first contact and
shall provide written confirmation of that disclosure to the seller/landlord’s
agent not later than execution of a purchase agreement or lease.
Standard of Practice 16-11 (Amended 1/98)
On unlisted property, REALTORS® acting as buyer/tenant agents
or brokers shall disclose that the relationship to the seller/landlord
at first contact for that client and shall provide written confirmation
of such disclosure to the seller/landlord not later than execution
of any purchase or lease agreement. REALTORS® shall make
any request for anticipated compensation from the seller/landlord
at first contact.
Standard of Practice 16-12 (Amended 1/98)
REALTORS®, acting as agents or brokers of sellers/landlords
or as subagents of listing brokers, shall disclose that relationship
to buyers/tenants as soon as practicable and shall provide written
confirmation of such disclosure to buyers/tenants not later than
execution of any purchase or lease agreement.
Standard of Practice 16-13 (Adopted 1/93, Amended 1/98)
All dealings concerning property exclusively listed, or with buyer/tenants
who are subject to an exclusive agreement shall be carried on
with the client’s agent or broker, and not with the client,
except with the consent of the client’s agent or broker or
except where such dealings are initiated by the client.
Standard of Practice 16-14 (Amended 1/98)
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.
Standard of Practice 16-15
In cooperative transactions REALTORS® shall compensate cooperating
REALTORS® (principal brokers) and shall not compensate nor
offer to compensate, directly or indirectly, any of the sales
licensees employed by or affiliated with other REALTORS® without
the prior express knowledge and consent of the cooperating broker.
Standard of Practice 16-16 (Amended 1/98)
REALTORS®, acting as subagents or buyer/tenant agents or brokers,
shall not use the terms of an offer to purchase/lease to attempt
to modify the listing broker’s offer of compensation to subagents
or buyer’s agents or brokers nor make the submission of
an executed offer to purchase/lease contingent on the listing
broker’s agreement to modify the offer of compensation.
Standard of Practice 16-17 (Amended 1/98)
REALTORS® acting as subagents or as buyer/tenant agents or
brokers, shall not attempt to extend a listing broker’s offer
of cooperation and/or compensation to other brokers without the
consent of the listing broker.
Standard of Practice 16-18 (Amended 1/93)
REALTORS® shall not use information obtained by them from
the listing broker, through offers to cooperate received through
Multiple Listing Services or other sources authorized by the listing
broker, for the purpose of creating a referral prospect to a third
broker, or for creating a buyer/tenant prospect unless such use
is authorized by the listing broker. cooperate received through
Multiple Listing Services or other sources authorized by the listing
broker, for the purpose of creating a referral prospect to a third
broker, or for creating a buyer/tenant prospect unless such use
is authorized by the listing broker.
Standard of Practice 16-19 (Amended 1/93)
Signs giving notice of property for sale, rent, lease, or exchange
shall not be placed on property without consent of the seller/landlord.
Standard of Practice 16-20 (Adopted 1/98)
REALTORS®, prior to or after terminating their relationship
with their current firm, shall not induce clients of their current
firm to cancel exclusive contractual agreements between the client
and that firm. This does not preclude REALTORS® (principals)
from establishing agreements with their associated licensees governing
assignability of exclusive agreements.
ARTICLE 17 (Amended 1/97)
In the event of contractual disputes or specific non-contractual
disputes as defined in Standard of Practice 17-4 between REALTORS®
associated with different firms, arising out of their relationship
as REALTORS®, the REALTORS® shall submit the dispute to
arbitration in accordance with the regulations of their Board
or Boards rather than litigate the matter.
In the event clients of REALTORS® wish to arbitrate contractual
disputes arising out of real estate transactions, REALTORS®
shall arbitrate those disputes in accordance with the regulations
of their Board, provided the clients agree to be bound by the
decision.
Standard of Practice 17-1 (Adopted 2/86)
The filing of litigation and refusal to withdraw from it by REALTORS®
in an arbitrable matter constitutes a refusal to arbitrate.
Standard of Practice 17-2 (Amended 17-2 (Amended 1/93)
Article 17 does not require REALTORS® to arbitrate in those
circumstances when all parties to the dispute advise the Board
in writing that they choose not to arbitrate before the Board.
Standard of Practice 17-3 (Adopted 1/96)
REALTORS® when acting solely as principles in a real estate
transaction, are not obligated to arbitrate disputes with other
REALTORS® absent a specific written agreement to the contrary.
Standard of Practice 17-4
Specific non-contractual disputes that are subject to arbitration
pursuant to Article 17 are:
1) Where a listing broker has compensated a cooperating broker
and another cooperating broker subsequently claims to be the
procuring cause of the sale or lease. In such cases the complainant
may name the first cooperating broker as respondent and arbitration
may proceed without the listing broker being named as respondent.
Alternatively, if the complaint is brought against the listing
broker, the listing broker may name the first cooperating broker
as a third party respondent. In either instance the decision
of the hearing panel as to procuring cause shall be conclusive
with respect to all current or subsequent claims of the parties
for compensation arising out of the underlying cooperative transaction.
(Adopted 1/97)
2) Where a buyer or tenant representative is compensated by
the seller or landlord, and not by the listing broker, and the
listing broker, as a result, reduces the commission owed by the
seller or landlord and, subsequent to such actions, another cooperating
broker claims to be the procuring cause of sale or lease. In
such cases the complainant may name the first cooperat-ing broker
as respondent and arbitration may proceed without the listing
broker being named as a respondent. Alternatively, if the complaint
is brought against the listing broker, the listing broker may
name the first cooperating broker as a third party respondent.
In either instance conclusive with respect to all
current or subsequent claims of the parties for compensation arising
out of the underlying cooperative transaction. (Adopted 1/97)
3) Where a buyer or tenant representative is compensated by
the buyer or tenant and, as a result, the listing broker reduces
the commission owed by the seller or landlord and, subsequent
to such actions, another cooperating broker claims to be the procuring
cause of sale or lease. In such cases the complainant may name
the first cooperating broker as respondent and arbitration may
proceed without the listing broker being named as a respondent.
Alternatively, if the complaint is brought against the listing
broker, the listing broker may name the first cooperating broker
as a third party respondent. In either instance the decision
of the hearing panel as to procuring cause shall be conclusive
with respect to all current or subsequent claims of the parties
for compensation arising out of the underlying cooperative transaction.
(Adopted 1/97)
4) Where two or more listing brokers claim entitlement to compensation
pursuant to open listings with a seller or landlord who agrees
to participate in arbitration (or who requests arbitration) and
who agrees to be bound by the decision. In cases where one of
the listing brokers has been compensated by the seller or landlord,
the other listing broker, as complainant, may name the first listing
broker as respondent and arbitration may proceed between the brokers.
(Adopted 1/97)
The Code of Ethics was adopted in 1913. Amended at the Annual Convention
in 1924,1928,1950, 1951, 1952, 1955, 1956, 1961, 1962, 1974, 1982, 1986, 1987,
1989, 1990, 1991, 1992, 1993, 1994, 1995, 1996, 1997 and 1998.
EXPLANATORY NOTES:
The reader should be aware the following policies which have been
approved by the Board of Directors of the National Association:
In filing a charge of an alleged violation of the Code of Ethics
by a REALTOR®, the charge must read as an alleged violation
of one or more Articles of the Code. Standards of Practice may
be cited in support of the charge.
The Standards of Practice serve to clarify the ethical obligations
imposed by the various Articles and supplement, and do not substitute
for, the Case Interpretations in Interpretations of the Code of
Ethics.
Modifications to existing Standards of Practice and additional
new Standards of Practice are approved from time to time. Readers
are cautioned to ensure that the most recent publications are
utilized.
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