unethical realtor

[ecrane]

What is the name of your state?
Indiana.
I made an offer on the house next door which inludes acreage behind my house. I faxed in a signed copy of a purchase agreement late Tuesday evening, but the realtor didn't show it to the seller until he got another offer from somebody he had shown the house to. They made an offer late Wednesday evening and he showed it to the seller imediately and the seller accepted their offer. Then he showed the seller my offer and the seller wants to keep mine as a backup. This is obviously a very unethical pactice used by a crooked realtor in order to keep the full commission for himself.
My question is; Is this also illegal? And if it is illegal, what recourse do I have?
Thanks,

ecrane

 

[HomeGuru]

What is the name of your state?
Indiana.
I made an offer on the house next door which inludes acreage behind my house. I faxed in a signed copy of a purchase agreement late Tuesday evening, but the realtor didn't show it to the seller until he got another offer from somebody he had shown the house to. They made an offer late Wednesday evening and he showed it to the seller imediately and the seller accepted their offer. Then he showed the seller my offer and the seller wants to keep mine as a backup. This is obviously a very unethical pactice used by a crooked realtor in order to keep the full commission for himself.
My question is; Is this also illegal? And if it is illegal, what recourse do I have?
Thanks,

ecrane

**A: unless you can prove what you said is correct and true via documented written evidence, you basically have no case.

 

[PghREA]

Many times, when a Seller knows that multiable offers are coming in, he choses to look at all of them at the same time. Since yours came in late Tuesday evening and the other one came in on Wednesday, he probably looked at both offers at the same time. The Seller has the power to accept or reject any offer for any reason. Just because yours was "sent" to the listing agent first does not mean that it should have priority over offers received later.

 

[BradleyS]

I am a real estate broker in Kansas, I do not give legal advice.

My opinion:

This situation is not uncommon. He may have an agency agreement with the seller and understand that he is working for HIS client. If your offer would net the seller less money that the offer that he presented then he looked out for the BEST interest of his client. And that is his primary duty.

If your offer was higher, and depending on any contingencies, proof provided, you should get legal advice.

FYI: a very unethical pactice used by a crooked realtor

Here is a link to download the Code of Ethics from NAR.

http://www.realtor.org/mempolweb.nsf/pages/code

Look hard at Article 1.

So before you judge the agent, you might check to see what ethics he is obligated to follow.

 

[UNCLEBUCK]

Hi BradleyS,

I had a thread about a situation that has now come to a conclusion, but I'd really like to see your take on this. It was a sale of family owned real estate handled by executor's, which were family members. (I'll refer to them as 'Seller's')


1) Seller's ask that an individual be named as an 'exclusion' in listing contract (3% as opposed to 6%) if he becomes Buyer as they had already spoken to him about the property.
Contract also states that the 3% will apply even if he is repesented by any other agent.

2) Broker that has 30 years of experience as a full time Realtor agree's with all terms and signs listing Contract along with Seller's. They now have a legally binding agreement.

3) The very next day, Broker calls and asks to meet with Seller's. He explains to them that he has made a 'mistake' by agreeing to the 'even if repesented by any other agent'. He convinces them that no Broker or Agent would ever agree to this and that is just can't possibly be done, even though it was his mistake. They believe him, and agree to ammend contract to not include that phrase.

4) As you may have already guessed, the exclusion did become the Buyer, and was reresented by another Realtor. Seller's spoke to several Attorney's, all of which felt it would be a very difficult case to win as they had signed the addendum. The case was settled after the Broker's agency offered to accept 50% of contested amount.

Also note that Broker never bothered to contact the Seller himself.

So here is my question. Immediately upon signing the contract, shouldn't the Broker have been 'looking out for the best interest's of the Seller's? Or do the Realtor Code of Ethic's exclude ethic's when it comes to their member's commission's?

 

[BradleyS]

Hi BradleyS,

I had a thread about a situation that has now come to a conclusion, but I'd really like to see your take on this. It was a sale of family owned real estate handled by executor's, which were family members. (I'll refer to them as 'Seller's')


1) Seller's ask that an individual be named as an 'exclusion' in listing contract (3% as opposed to 6%) if he becomes Buyer as they had already spoken to him about the property.
Contract also states that the 3% will apply even if he is repesented by any other agent.

2) Broker that has 30 years of experience as a full time Realtor agree's with all terms and signs listing Contract along with Seller's. They now have a legally binding agreement.

3) The very next day, Broker calls and asks to meet with Seller's. He explains to them that he has made a 'mistake' by agreeing to the 'even if repesented by any other agent'. He convinces them that no Broker or Agent would ever agree to this and that is just can't possibly be done, even though it was his mistake. They believe him, and agree to ammend contract to not include that phrase.

4) As you may have already guessed, the exclusion did become the Buyer, and was reresented by another Realtor. Seller's spoke to several Attorney's, all of which felt it would be a very difficult case to win as they had signed the addendum. The case was settled after the Broker's agency offered to accept 50% of contested amount.

Also note that Broker never bothered to contact the Seller himself.

So here is my question. Immediately upon signing the contract, shouldn't the Broker have been 'looking out for the best interest's of the Seller's? Or do the Realtor Code of Ethic's exclude ethic's when it comes to their member's commission's?

My Answer:

There are no exclusions in the REALTORS Code of Ethics.

Article 1---paraphrased
The REALTORS/BROKERS primary duty is to work in the best interest of their client, BUT this does not relieve REALTORS/BROKERS of their obligation to treat all parties honestly.

This is a good reference case that I found. It has good info.
See Quechee Lakes Rental Corp v. Boggess
Vermont Supreme Court

Supreme Court stated "a broker cannot be controlled by his own judgement, rather than that of his principal."

Additionally, the court stated "the broker had a duty to communicate material information relevant to the sale and it's failure to do so constituted as breach of fidicuary duty...................when a broker breaches a fiduciary duty to a principal, the broker is not entitled to receive a commission."

-----

I recommend that any person that thinks that their REALTOR whether a broker or salesperson is not or didn't (past) look out for their best interest, get a copy of the NAR's Code of Ethics, contact the local board office and file a written complaint stating the facts about which article the REALTOR may have not followed.

Additionally, contact your state's Real Estate Commision and find their procedures in filing a complaint.

I personally, work very hard to be a great broker. My dad was a broker for 35 years. If I believe, beyond any doubts, that one of my agents breached their fiduciary duty or was not looking out for their client's best interest, I will send their license to the Real Estate Commission along with a written complaint. I have done it before, and will love to do it again. Most broker's will not due this......they terminate the agent and then the agent goes to another brokerage to work.

I'm sick and tired of real estate professionals being compared with "used car salesman." The only way this will change is:

--From the public filing complaints at the local and state level.

--Broker's/owner's doing their job and get the "riff raff" out of this profession by filing written complaints.

Even though a transaction has been closed and a commission has been paid, you should be able to file a complaint.

 

[UNCLEBUCK]

BradleyS,

Wow. I didn't think I'd get this much info. I can't tell you how much I appreciate it. I wish all Broker's were like you.
Your a stand up guy.

I do want you to know why this is so important to me. Firstly, it's not about the money (I know a lot of people will say this, but in my case, it actually isn't, as the money is split evenly between the family members. And yes, it's a large family ) The property was sold as that is what my Mom, who recently passed, wanted to be done. She had wanted to sell the property before her passing. She also had the property listed, with a different Broker, but it obviously didn't sell in the period of the contract. She also wanted any future listing contracts written exactly as she had done, which included the exclusion with no exeptions to the 3% exclusion. Because the executor's (again family members) agreed to signing a contract which was different, it caused a lot of infighting and arguing among us. This is what has upset me more than anything. I think that understanding exactly what happened here, and knowing who was right and who was wrong is a first step for me in letting all of it go.

again, thanks so much.

 

[PghREA]

So, this is more of a family problem than a problem with the Realtors involved.

 

[HomeGuru]

Hi BradleyS,

I had a thread about a situation that has now come to a conclusion, but I'd really like to see your take on this. It was a sale of family owned real estate handled by executor's, which were family members. (I'll refer to them as 'Seller's')


1) Seller's ask that an individual be named as an 'exclusion' in listing contract (3% as opposed to 6%) if he becomes Buyer as they had already spoken to him about the property.
Contract also states that the 3% will apply even if he is repesented by any other agent.

2) Broker that has 30 years of experience as a full time Realtor agree's with all terms and signs listing Contract along with Seller's. They now have a legally binding agreement.

3) The very next day, Broker calls and asks to meet with Seller's. He explains to them that he has made a 'mistake' by agreeing to the 'even if repesented by any other agent'. He convinces them that no Broker or Agent would ever agree to this and that is just can't possibly be done, even though it was his mistake. They believe him, and agree to ammend contract to not include that phrase.

4) As you may have already guessed, the exclusion did become the Buyer, and was reresented by another Realtor. Seller's spoke to several Attorney's, all of which felt it would be a very difficult case to win as they had signed the addendum. The case was settled after the Broker's agency offered to accept 50% of contested amount.

Also note that Broker never bothered to contact the Seller himself.

So here is my question. Immediately upon signing the contract, shouldn't the Broker have been 'looking out for the best interest's of the Seller's? Or do the Realtor Code of Ethic's exclude ethic's when it comes to their member's commission's?

**A: why are you hijacking someone elses thread? You already made a thread on this subject and should have referred BradleyS to THAT thread rather than writing on this one.

 

[UNCLEBUCK]

ecrane,

Sorry about hijacking your thread. Let me know if you'd like me to delete any or all of my post's here. I made an error in thinking that 1) Your question was answered, and 2) That my question may have also helped you. In hindsight I should have just pointed to my other Thread, as this would have more efficiently addressed both #1 and #2.

PghREA,

"So, this is more of a family problem than a problem with the Realtors involved."
No. Two separate issues. The fact that the Broker's action's eventually caused family problems does not excuse him from his actions.

HomeGuru,

"You already made a thread on this subject and should have referred BradleyS to THAT thread rather than writing on this one."

You are correct. See above.

 

[HomeGuru]

Much better and keep doing what is right.

 

[UNCLEBUCK]

Likewise..