By: Byron King

Case #16-13: Dealings Initiated by Another Broker’s Client

REALTOR® A, a residential broker, had recently listed a home. REALTOR® A’s marketing campaign included open houses on several consecutive weekends.

One Sunday afternoon Buyer B came to the open house. REALTOR® A introduced herself to Buyer B and asked whether Buyer B was working with another broker. Buyer B responded that he was, in fact, exclusively represented but went on to add that he was quite familiar with the property as it had been previously owned by a close personal friend. REALTOR® A told Buyer B that she would be happy to show Buyer B through the home but reminded Buyer B that she represented the seller and not Buyer B.

After viewing the home, Buyer B indicated that he had pressing business travel plans, was seriously interested in the property, and requested REALTOR® A’s assistance in preparing a purchase offer. REALTOR® A assisted Buyer B in filling out a standard form purchase contract and later that day presented the offer to the seller who accepted it.

REALTOR® A was subsequently charged with violating Article 16 for dealing and negotiating with a party who had an exclusive relationship with another REALTOR®.

At the hearing, REALTOR® A defended her actions noting that she had told Buyer B that she was the seller’s exclusive agent and, as such, would not and could not represent Buyer B’s interests. She pointed out that it was only after Buyer B had insisted on writing a purchase offer without the assistance of his exclusive representative that REALTOR® A had agreed to do so. She concluded her defense noting that Standard of Practice 16-13 authorizes dealings with the client of another broker in cases where those dealings are initiated by the client.

See below for how this hearing panel ruled…if you think a violation, how much discipline would you impose? Fine of $________ and ____ hours of education.

Citations are not available for fair housing ethics article 10 complaints due to the seriousness of the allegation. However, respondents always have the due process right to waive a right to a hearing (e.g., admit the violation, take the discipline imposed). Associations report fair housing violations to the licensing authority. [Citations can apply to other related lesser offenses in a complaint:  If you were the respondent (aka defendant) REALTOR® in this complaint would you have considered taking an offered citation (small fine and education) in lieu of a full formal ethics hearing or waiving your right to a full formal hearing and accepting the fine and education imposed by the ethics committee who takes into account your admission of unprofessional behavior (aka take a plea deal)?]

SCR is receiving numerous reports of unprofessional behavior. Across the country, unprofessional behavior is the number #1 complaint by REALTORS® about their colleagues in the market.

There are several ways of addressing and trying to correct unprofessional behavior. Lead by example. If you see unprofessional behavior, say something. Discuss with the other REALTOR®. Discuss with the REALTOR®’s Broker-in-Charge (BIC). Consider filing ethics complaints at the appropriate association and filing license law complaints at LLR.

REALTORS® have an ethical duty to report fair housing/discrimination issues, fraud resulting in substantial economic harm, and misappropriation of client/customer funds/property.

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…


Fraud resulting in substantial economic harm…

bring such matters to the attention of the appropriate Board or Association of REALTORS®.

The Hearing Panel agreed with REALTOR® A that she was the seller’s exclusive representative and had not represented the buyer and concluded that her conduct had not violated Article 16, as interpreted by Standard of Practice 16-13.

Posted by: Byron King on 06/26/20 (This information is only accurate as of 06/26/20. You must contact SCR for updates and changes to this information after 06/26/20 as laws and regulations may change over time. SCR 803-772-5206 or email Byron)