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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.
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®.
(Amended 1/00)
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, do ye
even so to them.”
Accepting
this standard as their own,
Realtors®
pledge to observe its spirit in all of their activities
whether conducted personally, through associates or others,
or via technological means, and to conduct their business in
accordance with the tenets set forth below. (Amended
1/07)
Duties
to Clients and Customers
Article 1
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 to
the client 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. (Amended 1/01)
• Standard
of Practice 1-1
Realtors®,
when acting as principals in a real estate transaction,
remain obligated by the duties imposed by the Code of
Ethics. (Amended 1/93)
• Standard
of Practice 1-2
The duties
imposed by the Code of Ethics encompass all real
estate-related activities and transactions whether conducted
in person, electronically, or through any other means.
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; “prospect” means a purchaser, seller, tenant, or
landlord who is not subject to a representation relationship
with the Realtor®
or 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. (Adopted 1/95, Amended
1/07)
• 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
Realtors®,
when seeking to become a buyer/tenant representative, shall
not mislead buyers or tenants as to savings or other
benefits
• Standard
of Practice 1-5
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. (Adopted 1/93)
• Standard
of Practice 1-6
Realtors®
shall submit offers and counter-offers objectively and as
quickly as possible. (Adopted 1/93, Amended 1/95)
• Standard
of Practice 1-7
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 obligated 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 the pre-existing purchase contract or lease. (Amended
1/93)
• Standard
of Practice 1-8
Realtors®,
acting as agents or brokers 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. (Adopted 1/93, Amended
1/99)
• Standard
of Practice 1-9
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
confidential 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.
Information
concerning latent material defects is not considered
confidential information under this Code of Ethics.
(Adopted 1/93, Amended 1/01)
• Standard
of Practice 1-10
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. (Adopted 1/95, Amended
1/00)
• Standard
of Practice 1-11
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. (Adopted 1/95)
• Standard
of Practice 1-12
When entering
into listing contracts,
Realtors®
must advise sellers/ landlords of: 1) the
Realtor®’s
company policies regarding cooperation and the amount(s) of
any compensation that will be offered 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 listing brokers, or by sellers/landlords may
represent the interests of buyers/tenants; and 3) any
potential for listing brokers to act as disclosed dual
agents, e.g., buyer/tenant agents. (Adopted 1/93,
Renumbered 1/98, Amended 1/03)
• Standard
of Practice 1-13
When entering
into buyer/tenant agreements,
Realtors®
must advise potential clients of: 1) the
Realtor®’s
company policies regarding cooperation; 2) the
amount of compensation to be paid by the client; 3) the
potential for additional or offsetting compensation from
other brokers, from the seller or landlord, or from other
parties; 4) any
potential for the buyer/tenant representative to act as a
disclosed dual agent, e.g., listing broker, subagent,
landlord’s agent, etc., and 5) the
possibility that sellers or sellers’ representatives may not
treat the existence, terms, or conditions of offers as
confidential unless confidentiality is required by law,
regulation, or by any confidentiality agreement between
the parties. (Adopted 1/93, Renumbered 1/98, Amended
1/06)
• Standard
of Practice 1-14
Fees for
preparing appraisals or other valuations shall not be
contingent upon the amount of the appraisal or valuation.
• Standard
of Practice 1-15
Realtors®,
in response to inquiries from buyers or cooperating brokers
shall, with the sellers’ approval, disclose the existence of
offers on the property. Where disclosure is authorized,
Article 2
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. (Amended 1/00)
• Standard
of Practice 2-1
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. (Amended 1/96)
• 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
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. (Adopted 1/93)
Article 3
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.
(Amended 1/95)
• Standard
of Practice 3-1
Realtors®,
acting as exclusive agents or brokers of sellers/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. (Amended 1/99)
• Standard
of Practice 3-2
Realtors®
shall, with respect to 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
Standard of
Practice 3-2 does not preclude the listing broker and
cooperating broker from entering into an agreement to change
cooperative compensation. (Adopted 1/94)
• Standard
of Practice 3-4
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 before the client
makes an offer to purchase or lease. (Amended 1/02)
• Standard
of Practice 3-5
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. (Amended 1/93)
• Standard
of Practice 3-6
Realtors®
shall disclose the existence of accepted offers, including
offers with unresolved contingencies, to any broker seeking
cooperation. (Adopted 5/86, Amended 1/04)
• Standard
of Practice 3-7
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. (Amended 1/95)
• Standard
of Practice 3-8
Realtors®
shall not misrepresent the availability of access to show or
inspect a listed property. (Amended 11/87)
Article 4
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. (Amended 1/00)
• Standard
of Practice 4-1
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. (Adopted 2/86)
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
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.
(Amended 1/99)
• Standard
of Practice 6-1
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.
(Amended 5/88)
Article 7
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. (Amended 1/93)
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 all agreements related to real estate
transactions including, but not limited to, listing and
representation agreements, purchase contracts, and leases
are in writing in 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 to such agreements upon their
signing or initialing. (Amended 1/04)
• Standard
of Practice 9-1
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. (Amended 1/93)
• Standard
of Practice 9-2
When
assisting or enabling a client or customer in establishing a
contractual relationship (e.g., listing and representation
agreements, purchase agreements, leases, etc.)
electronically,
Realtors® shall make reasonable efforts to
explain the nature and disclose the specific terms of the
contractual relationship being established prior to it being
agreed to by a contracting party. (Adopted 1/07)
Duties
to the Public
Article 10
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. (Amended 1/90)
Realtors®,
in their real estate employment practices, shall not
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
When involved
in the sale or lease of a residence,
Realtors®
shall not volunteer information regarding the racial,
religious or ethnic composition of any neighborhood nor
shall they engage in any activity which may result in panic
selling, however,
Realtors® may
provide other demographic information. (Adopted 1/94,
Amended 1/06)
• Standard
of Practice 10-2
When not
involved in the sale or lease of a residence,
Realtors®
may provide demographic information related to a property,
transaction or professional assignment to a party if such
demographic information is (a) deemed by the
Realtor®
to be needed to assist with or complete, in a manner
consistent with Article 10, a real estate transaction or
professional assignment and (b) is obtained or derived from
a recognized, reliable, independent, and impartial source.
The source of such information and any additions, deletions,
modifications, interpretations, or other changes shall be
disclosed in reasonable detail. (Adopted 1/05, Renumbered
1/06)
• Standard
of Practice 10-3
Realtors®
shall not print, display or circulate any statement or
advertisement with respect to selling or renting of a
property that indicates any preference, limitations or
discrimination based on race, color, religion, sex,
handicap, familial status, or national origin. (Adopted
1/94, Renumbered 1/05 and 1/06)
• Standard
of Practice 10-4
As used in
Article 10 “real estate employment practices” relates to
employees and independent contractors providing real
estate-related services and the administrative and clerical
staff directly supporting those individuals. (Adopted
1/00, Renumbered 1/05 and 1/06)
Article 11
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 disclosed 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. (Amended 1/95)
• Standard
of Practice 11-1
When
Realtors®
prepare opinions of real property value or price, other than
in pursuit of a listing or to assist a potential purchaser
in formulating a purchase offer, such opinions shall include
the following: 1) identification
of the subject property 2) date
prepared 3) defined
value or price 4) limiting
conditions, including statements of purpose(s) and intended
user(s) 5) any
present or contemplated interest, including the possibility
of representing the seller/landlord or buyers/tenants 6) basis
for the opinion, including applicable market data 7) if
the opinion is not an appraisal, a statement to that effect
(Amended 1/01)
• Standard
of Practice 11-2
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®
is an agent or subagent, the obligations of a fiduciary.
(Adopted 1/95)
• Standard
of Practice 11-3
When
Realtors®
provide consultive 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 consultive services, a separate compensation may
be paid with prior agreement between the client and
Realtor®.
(Adopted 1/96)
• Standard
of Practice 11-4
The
competency required by Article 11 relates to services
contracted for between
Realtors® and their clients or customers;
the duties expressly imposed by the Code of Ethics; and the
duties imposed by law or regulation. (Adopted 1/02)
Article 12
Realtors®
shall be honest and truthful in their real estate
communications and shall present a true picture in their
advertising, marketing, and other representations.
Realtors®
shall ensure that their status as real estate professionals
is readily apparent in their advertising, marketing, and
other representations, and that the recipients of all real
estate communications are, or have been, notified that those
communications are from a real estate professional.
(Amended 1/08)
• Standard
of Practice 12-1
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. (Amended
1/97)
• Standard
of Practice 12-2
Realtors®
may represent their services as “free” or without cost
• Standard
of Practice 12-3
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.
(Amended 1/95)
• Standard
of Practice 12-4
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. (Amended 1/93)
• Standard
of Practice 12-5
Realtors®
shall not advertise nor permit any person employed by or
affiliated with them to advertise listed property in any
medium (e.g., electronically, print, radio, television,
etc.) without disclosing the name of that
Realtor®’s
firm in a reasonable and readily apparent manner.
(Adopted 11/86, Amended 1/07)
• Standard
of Practice 12-6
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. (Amended 1/93)
• Standard
of Practice 12-7
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
• Standard
of Practice 12-8
The
obligation to present a true picture in representations to
the
• Standard
of Practice 12-9
Realtor®
firm websites shall disclose the firm’s name and state(s) of
licensure in a reasonable and readily apparent manner.
Websites of
Realtors®
and non-member licensees affiliated with a
Realtor®
firm shall disclose the firm’s name and that
Realtor®’s
or non-member licensee’s state(s) of licensure in a
reasonable and readily apparent manner. (Adopted 1/07)
• Standard
of Practice 12-10
Realtors®’
obligation to present a true picture in their advertising
and representations to the public includes the URLs and
domain names they use, and prohibits
Realtors®
from: 1) engaging
in deceptive or unauthorized framing of real estate
brokerage websites; 2) manipulating
(e.g., presenting content developed by others) listing
content in any way that produces a deceptive or misleading
result; or 3) deceptively
using metatags, keywords or other devices/ methods to
direct, drive, or divert Internet traffic, or to otherwise
mislead consumers. (Adopted 1/07)
• Standard
of Practice 12-11
Realtors®
intending to share or sell consumer information gathered via
the Internet shall disclose that possibility in a reasonable
and readily apparent manner. (Adopted 1/07)
• Standard
of Practice 12-12
Realtors®
shall not:
1) use
URLs or domain names that present less than a true picture, 2) register
URLs or domain names which, if used, would present less than
a true picture. (Adopted 1/08)
• Standard
of Practice 12-13
The
obligation to present a true picture in advertising,
marketing, and representations allows
Realtors®
to use and display only professional designations,
certifications, and other credentials to which they are
legitimately entitled. (Adopted 1/08)
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.
Article 14
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. (Amended 1/99)
• Standard
of Practice 14-1
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. (Amended 1/95)
• Standard
of Practice 14-2
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.
(Amended 1/92)
• Standard
of Practice 14-3
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.
(Adopted 11/87, Amended 1/99)
• Standard
of Practice 14-4
Realtors®
shall not intentionally impede the Board’s investigative or
disciplinary proceedings by filing multiple ethics
complaints based on the same event or transaction.
(Adopted 11/88)
Duties
to Realtors®
Article
15
Realtors®
shall not knowingly or recklessly make false or misleading
statements about competitors, their businesses, or their
business practices. (Amended 1/92)
• Standard
of Practice 15-1
Realtors®
shall not knowingly or recklessly file false or unfounded
ethics complaints. (Adopted 1/00)
• Standard
of Practice 15-2
The
obligation to refrain from making false or misleading
statements about competitors’ businesses and competitors’
business practices includes the duty to not knowingly or
recklessly repeat, retransmit, or republish false or
misleading statements made by others. This duty applies
whether false or misleading statements are repeated in
person, in writing, by technological means (e.g., the
Internet), or by any other means. (Adopted 1/07)
Article 16
Realtors®
shall not engage in any practice or take any action
inconsistent with exclusive representation or exclusive
brokerage relationship agreements that other
Realtors®
have with clients. (Amended 1/04)
• Standard
of Practice 16-1
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 expenses. (Adopted 1/93, Amended 1/95)
• Standard
of Practice 16-2
Article 16
does not preclude
Realtors® from making general
announcements to prospects 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 prospects 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 1/04)
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 prospects 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 subagency or
cooperation. (Amended 1/04)
• Standard
of Practice 16-3
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) or from offering the same type of
service for property not subject to other brokers’ exclusive
agreements. 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.
(Amended 1/04)
• Standard
of Practice 16-4
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. (Amended 1/94)
• Standard
of Practice 16-5
Realtors®
shall not solicit buyer/tenant agreements from buyers/
tenants who are subject to exclusive buyer/tenant
agreements. However, if asked by a
Realtor®,
the broker refuses to disclose the expiration date of the
exclusive buyer/tenant agreement, the
Realtor®
may contact the buyer/tenant to secure such information and
may discuss the terms upon which the
Realtor®
might enter into a 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. (Adopted 1/94, Amended
1/98)
• Standard
of Practice 16-6
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. (Amended 1/98)
• Standard
of Practice 16-7
The fact that
a prospect has retained a
Realtor®
as an exclusive representative or exclusive broker in one or
more past transactions does not preclude other
Realtors®
from seeking such prospect’s future business. (Amended
1/04)
• Standard
of Practice 16-8
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. (Amended 1/98)
• Standard
of Practice 16-9
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. (Amended 1/04)
• Standard
of Practice 16-10
Realtors®,
acting as buyer or tenant representatives or brokers, shall
disclose that relationship to the seller/landlord’s
representative or broker at first contact and shall provide
written confirmation of that disclosure to the
seller/landlord’s representative or broker not later than
execution of a purchase agreement or lease. (Amended
1/04)
• Standard
of Practice 16-11
On unlisted
property, Realtors®
acting as buyer/tenant representatives or brokers shall
disclose that relationship to the seller/landlord at first
contact for that buyer/tenant and shall provide written
confirmation of such disclosure to the seller/landlord not
later than execution of any purchase or lease agreement.
(Amended 1/04)
Realtors®
shall make any request for anticipated compensation from the
seller/landlord at first contact. (Amended 1/98)
• Standard
of Practice 16-12
Realtors®,
acting as representatives 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. (Amended 1/04)
• Standard
of Practice 16-13
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 representative or
broker, and not with the client, except with the consent of
the client’s representative or broker or except where such
dealings are initiated by the client.
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 any
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 prospects. (Adopted 1/93, Amended 1/04)
• Standard
of Practice 16-14
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. (Amended 1/98)
• 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
Realtors®,
acting as subagents or buyer/tenant representatives 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/tenant
representatives 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.
(Amended 1/04)
• Standard
of Practice 16-17
Realtors®,
acting as subagents or as buyer/tenant representatives 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. (Amended 1/04)
• Standard
of Practice 16-18
Realtors®
shall not use information obtained from listing brokers
through offers to cooperate made through multiple listing
services or through other offers of cooperation to refer
listing brokers’ clients to other brokers or to create
buyer/tenant relationships with listing brokers’ clients,
unless such use is authorized by listing brokers.
(Amended 1/02)
• Standard
of Practice 16-19
Signs giving
notice of property for sale, rent, lease, or exchange shall
not be placed on property without consent of the
seller/landlord. (Amended 1/93)
• Standard
of Practice 16-20
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. (Adopted 1/98)
Article 17
In the event
of contractual disputes or specific non-contractual disputes
as defined in Standard of Practice 17-4 between
Realtors®
(principals) 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.
The
obligation to participate in arbitration contemplated by
this Article includes the obligation of
Realtors®
(principals) to cause their firms to arbitrate and be bound
by any award. (Amended 1/01)
• Standard
of Practice 17-1
The filing of
litigation and refusal to withdraw from it by
Realtors®
in an arbitrable matter constitutes a refusal to arbitrate.
(Adopted 2/86)
• Standard
of Practice 17-2
Article 17
does not require
Realtors® to arbitrate in those
circumstances when all parties to the dispute advise the
Board
• Standard
of Practice 17-3
Realtors®,
when acting solely as principals in a real estate
transaction, are not obligated to arbitrate disputes with
other Realtors®
absent a specific written agreement to the contrary.
(Adopted 1/96)
• 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 a respondent. When arbitration occurs
between two (or more) cooperating brokers and where the
listing broker is not a party, the amount in dispute and the
amount of any potential resulting award is limited to the
amount paid to the respondent by the listing broker and any
amount credited or paid to a party to the transaction at the
direction of the 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, Amended 1/07)
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 cooperating broker as respondent and arbitration may
proceed without the listing broker being named as a
respondent. When arbitration occurs between two (or more)
cooperating brokers and where the listing broker is not a
party, the amount in dispute and the amount of any potential
resulting award is limited to the amount paid to the
respondent by the seller or landlord and any amount credited
or paid to a party to the transaction at the direction of
the 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, Amended 1/07)
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)
5) 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,
claims to be the procuring cause of sale or lease. In such
cases arbitration shall be between the listing broker and
the buyer or tenant representative and the amount in dispute
is limited to the amount of the reduction of commission to
which the listing broker agreed. (Adopted 1/05)
• Standard
of Practice 17-5
The
obligation to arbitrate established in Article 17 includes
disputes between
Realtors® (principals) in different states
in instances where, absent an established inter-association
arbitration agreement, the
Realtor®
(principal) requesting arbitration agrees to submit to the
jurisdiction of, travel to, participate in, and be bound by
any resulting award rendered in arbitration conducted by the
respondent(s) Realtor®’s
association, in instances where the respondent(s) Realtor®’s association determines that an
arbitrable issue exists. (Adopted 1/07)
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, 1998, 1999, 2000, 2001, 2002,
2003, 2004, 2005, 2006, 2007 and 2008.
Explanatory Notes
The reader
should be aware of 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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