Spotlight on the Code of Ethics

Real-Life Situations to Help You Better Understand the Code. 

Each week the Professional and Ethical Practices Department is bringing you an Article of the Code of Ethics and an example of a case file related to that Article. Below you will find links to real-life scenarios and the conclusions of the issues related to specific Articles of the Code of Ethics.
 
These interpretations of the Code of Ethics present specific situations involving charges of alleged unethical conduct by REALTORS®, which are reviewed by a peer panel of Board Members and in which decisions as to ethical conduct are reached.  Each case provides the Hearing Panel’s decision based on the facts and the rationale for the decision.

 

Articles & Scenarios 

Article 1

Promotion of Client Interests
Presentation of Subsequent Offers After an Offer to Purchase Had Been Accepted by the Seller
Obligation to Protect Client’s Interests
Net Listing
REALTORS® Buying and Selling to One Another are Still Considered REALTORS®
Disclosure of Latent Defects
Disclosure of Existence of Offers to Prospective Purchasers
Fidelity to Client’s Interests
Multiple Offers Where Listing Broker Agrees to Reduce Listing Broker’s Commission

Article 2

Ascertainment and Disclosure of Pertinent Facts
Obligation to Ascertain Pertinent Facts
REALTOR® Error
Obligation to Disclose Defects
Misrepresentation
​REALTOR®’s Responsibility for REALTOR-ASSOCIATE®’s Statement
REALTORS® Buying and Selling to One Another are Still Considered REALTORS®

Article 3

Time at Which Modification to Offer of Compensation is Communicated is a Determining Factor
Refusal to Extend Cooperation in Sale of New Homes
REALTOR®’s Obligation to Disclose Dual Commission Arrangements
Obligation to Disclose True Nature of Listing Agreement
Disclose Accepted Offers with Unresolved Contingencies
REALTOR®’s Obligation to Disclose True Nature of Listing Agreement

Article 4

Fidelity to Client
Responsibility for Subordinates
Disclosure When Buying on Own Account
Disclosure of Family Interest
Indirect Interest in Buyer
Disclosure of Secured Interest in Listed Property

Article 5

Contemplated Interest in Property Appraised

Article 6

Disclose affiliated business relationships prior to recommending real estate related products or services
Acceptance of Rebates From Contractors
Advertising Real Estate-Related Products and Services
Management Responsibility in Relation to Manager’s Enterprises
Manager’s Use of Client’s Property for Vending Machines
Profit on Supplies Used in Property Management

Article 7

Acceptance of Compensation from Buyer and Seller

Article 8

Failure to Put Deposit in Separate Account
Request for Investigation Filed by Board With the State Real Estate Commission

Article 10

Use of “Choose Your Neighbor" Form Letters as Part of a Marketing Campaign
Equal Professional Services by the REALTOR®
Use of “Choose Your Neighbor” Marketing Letters
Equal Professional Services by the REALTOR®
Denial of Equal Professional Service

Article 11

REALTORS® Obligation to Disclose Present or Contemplated Interests
Appraiser’s Competence to Assignment
Disclosure of Limited Appraisal Experience
REALTOR®’s Obligation to Disclose Present or Contemplated Interest
Appraiser’s Obligation to Consider All Factors of Value
Obligation to Disclose Assistance in Appraisal
Identification of Contributor to Appraisal

Article 12

Advertisements by Individuals Other than the Listing Broker
Special Spotlight
Advertising in the Guise of News
Advertising Including Information Based on Other Brokers’ Transactions
True Picture in Use of “Sold” Sign
Remove Information About Listings from Websites Once Authority to Advertise Ends
REALTOR® Advertising Free Market Analysis
Advertising Role in Sales After Changing Firm Affiliation
Exaggeration in Advertising

Article 13

Preparation of Instrument Unrelated to Real Estate Transaction
REALTOR®’s Obligation to Recommend Counsel When Needed
Use of Standard Purchase Contract Form

Article 14

Submission of Pertinent Facts
Refusal to Submit Pertinent Facts

Article 15

Knowing or Reckless False Statements About Competitors
Intentional Misrepresentation of a Competitor’s Business Practices

Article 16

Continued Contact With Potential Seller Who Enters Into an Exclusive Listing With Another REALTOR®
REALTOR®’s Refusal to Disclose Nature and Current Status of Listing to Another REALTOR®
Dealings Initiated by Another Broker’s Client
Solicitation of Expired Exclusive Listing
Assumed Consent for Direct Contact
​Mass Media Solicitation Not a Violation of the Code