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®. (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
and to conduct their business in accordance with the
tenets set forth below.
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 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
1/04)
• 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 that might be realized
through use of the REALTOR®'s services. (Amended
1/93)
• 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; and
4) any potential for the buyer/tenant representative
to act as a disclosed dual agent, e.g. listing broker,
subagent, landlord's agent, etc. (Adopted 1/93, Renumbered
1/98, Amended 1/04)
• Standard of Practice 1-14
Fees for preparing appraisals or other valuations shall
not be contingent upon the amount of the appraisal or
valuation. (Adopted 1/02)
• Standard of Practice 1-15
REALTORS®, in response to inquiries from buyers
or cooperating brokers shall, with the sellers’
approval, divulge the existence of offers on the property.
(Adopted 1/03)
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. (Amended 1/94)
• 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)
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. (Amended 1/00)
• 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 discrimination based
on race, color, religion, sex, handicap, familial status,
or national origin. (Adopted 1/94)
• Standard of Practice 10-2
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)
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 careful at all times to present
a true picture in their advertising and representations
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. (Amended
1/93)
• 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 even if they expect to receive compensation
from a source other than their client provided that
the potential for the REALTOR® to obtain a benefit
from a third party is clearly disclosed at the same
time. (Amended 1/97)
• 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 without disclosing the name of the firm. (Adopted
11/86)
• 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 post a "sold"
sign only with the consent of the listing broker. (Amended
1/96)
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)
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)
(Amended 1/93)
• 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 in writing that they choose not to
arbitrate before the Board. (Amended 1/93)
• 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. 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 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)
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, 1998, 1999, 2000, 2001, 2002 and 2003.
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.
© 2004, NATIONAL
ASSOCIATION OF REALTORS®, All Rights
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