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2012
Ethics Seminar
Instructor Manual
The Business Advocate for Real Estate Professionals

2012 Ethics Training Guide - Instructor
Virginia Association of REALTORS® 1
INSTRUCTOR
DIRECTIONS
PURPOSE
This course has been designed to provide you, the
instructor, with maximum flexibility. You have several
teaching tools included in this package that can be selected
based on the size of the class, length of allotted time, and
experience level of the participants.
Teaching tools include:
 Detailed Instructor Guide
 Student Handouts
 PowerPoint presentation
 Compilation of case studies
This course meets the learning objectives set forth by the
National Association that satisfy the mandatory member
ethics training provided that the classroom instruction
portion of the seminar (excluding breaks) lasts at least 2½
hours.
VAR designed and annually distributes this course to
ensure that education on the Code of Ethics is consistent
throughout the state. It is critical to the harmony of the
industry that all REALTORS® be taught a consistent code
of conduct. This course was developed over several years
and is distributed to over 200 Certified Ethics Trainers
around the state. We hope that every instructor will use
these materials so that complete, consistent, and accurate
information about the Code of Ethics will be taught to all
Virginia REALTORS®.
This Instructor Manual is written in a narrative format,
but it should not be read by the instructor. Instructors
should use this “script” only as a guide for sample
language that can be used to explain the Code.

HOW TO USE
THIS
MATERIAL
Instructor Guide: This Instructor Guide provides you
with detailed information on all 17 Articles of the Code
and many Standards of Practice. A minimum of three
hours is required to cover this material in its entirety. If
you do not have three hours, VAR recommends that you
cover Articles 1, 2, 9, 12 and 16 in detail and discuss the
other Articles as time permits. These five articles have
consistently been the leading source of ethics complaints
in Virginia and other states.
Slides are included for any SOPs changed for 2011 and
2012. Use your discretion when determining which SOPs
to include in your presentation, keeping in mind their
relationship to the case studies provided.
There are three new case studies dealing with Article 16
and stressing Standard of Practice 16-13. It is highly
recommended that instructors allow time for the review
of these cases and to contrast and compare them using
NAR’s recommended decisions.
PLEASE NOTE: Local boards or associations may now
“require” mediation prior to arbitration. The utilization
of this local option must be voted on and written into
local PS&A policy if approved by the local BOD. Article
17 has been amended to reflect this local option.
Pre-test: The enclosed pre-test has been designed to help
focus students at the beginning of the seminar. It can also
be used as a post-test to ensure that students have
accomplished the course objectives.
Student Handouts: Included in this material are handouts
for students to use during this seminar. Included in these
handouts are the following:
 Copy of the Code of Ethics
 Pre-test
 Case Studies
 Code of Ethics Product Information Sheet

Projected Images: The accompanying PowerPoint
presentation includes “slides” of key points of the
presentation. The (OH) in the left-hand column indicates
where they should be used.
Q&A: If a question pops up during the seminar that you
are not sure how to answer, please feel free to call during
the break to make sure correct information is provided.
Call another Ethics Trainer or VAR at 800-755-8271 or
804-264-5033.
If no help is immediately available, tell the student or the
class that you will get the answer to the question at the
earliest possible time.
All of the Instructor and Student materials are available as
downloadable files from the VAR website at
www.varealtor.com (Click on “Career Development” and
then “Ethics Training” and then “For Certified Ethics Trainers”)
The overheads are saved in Microsoft PowerPoint. All
other files are saved as PDF files.

COURSE Upon completion of this course, students should be able
OBJECTIVES to all of the following:
1. Briefly describe the history of the Code of Ethics.
Identify concepts in the Preamble.
2. Identify the Golden Rule as one of the foundations
upon which the Code of Ethics is built.
3. List the major categories of Articles in the Code (Duties
to Clients and Customers, Duties to the
(OH) Public and Duties to REALTORS®).
4. Describe the structure of the Code and its supporting
materials (Articles, Standards of
Practice and Case Interpretations).
5. List Articles of the Code which are commonly the
subject of complaints.
6. Describe the concepts of these commonly cited Articles
of the Code, including Articles 1, 2, 9, 12, 16, and
changes to Articles 15 and 17.
7. Review case studies, fact scenarios or similar
interactive learning methods to identify possible
violations of the Code of Ethics, specifically related to
the commonly cited Articles.
(OH) 8. Describe the professional standards enforcement process
of the board or association, including the distinction
between an ethics complaint and an arbitration petition,
and the differences between the Grievance Committee
and the Professional Standards Committees.
9. Briefly discussion mediation as a dispute resolution
alternative.
10. Be familiar with the revised “Pathways to
Professionalism”.
Instructor Note: Discuss why this course is required.

FORMAT
This course has been designed to allow students to learn
through participation in class exercises in addition to
lecture. Although some class exercises are included in this
material the instructor has the flexibility to select different
methods of teaching depending on the class size, allotted
time and level of learning.
When teaching new agents, instructors might want to
include more SOPs for clarification and exemplification
of the Articles. When teaching more experienced agents,
it is recommended that instructors allow time for as many
cases as possible, since they are illustrative of brokerage
practices which have been judged to be acceptable or
unacceptable under the Code of Ethics.
INSTRUCTION TO STUDENTS:
We are going to start today with a brief Professional
Standards and Code of Ethics test. After you finish
answering it, keep it nearby. You may learn things during
the next few hours that will make you want to go back and
change a few answers.
We will go over the answers at the end of the class.
NOTE: The instructor test sheet includes specific Code of
of Ethics references to explain answers.

(OH)
VIRGINIA ASSOCIATION OF REALTORS®
PROFESSIONAL STANDARDS SEMINAR PRE-TEST
Student Manual
Page 2
All questions are based on the Code of Ethics and Arbitration Manual of the National Association of
REALTORS®. All answers will be covered in the seminar content.
1. REALTORS® having direct personal knowledge of conduct that might violate the Code
involving which of the following bring such matters to the attention of their local Association.
a) misappropriation of client or customer funds or property
b) willful discrimination
c) fraud resulting in substantial economic harm
d) all of the above
(Note: Preamble)
2. Unless otherwise agreed in writing, the REALTOR® shall:
a) submit all written offers and counter-offers until an offer is accepted
b) submit all written offers and counter-offers until closing
c) submit all offers and counter-offers until an offer is accepted
d) submit all offers and counter-offers until closing
(Note: Standard of Practice 1-7)
3. Which of the following may Virginia REALTOR® reveal to others during or following the
termination of professional relationships with their clients:
a) confidential information about the client
b) information about the client that the REALTOR® can use to their own advantage
c) information concerning latent material defects
d) information about ghosts in the house
4. When entering into buyer/tenant agency agreements, Virginia REALTORS® must advise
potential clients of:
a) the REALTOR®'s company policies regarding cooperation
b) the amount of compensation to be paid by the client
c) the potential for additional or offsetting compensation from other brokers, from the seller or
landlord, or from other parties
d) any potential for the buyer/tenant representative to act as a disclosed dual agent, e.g. listing
broker, subagent, landlord's agent, etc.
e) the possibility that the existence, terms and conditions of their offer may not be confidential
f) all of the above

5. In response to inquiries from buyers or cooperating brokers REALTORS® shall, with the
sellers’ approval, disclose:
a) the existence of other offers
b) if other offers were obtained by the listing agent or the listing agent’s firm
c) if other offers were from a cooperating broker
d) all of the above
6. Which is not true regarding dual or variable rate commission arrangements:
a) listing brokers have an affirmative obligation to disclose their existence
b) listing brokers must disclose the amount of the listing commission
c) only in response to inquires, disclose the differential amount to a cooperating broker
d) a buyer representative must disclose to their buyer-client the existence of a dual rate commission
before they make an offer to purchase
7. In which of the following circumstances is it permissible for a REALTOR® to contact the
client of another broker:
a) to offer to provide a different type of real estate service
b) offering the same type of service for a property not already listed
c) when the client’s name is learned through a Multiple Listing Service
d) either or both A and B
8. Article 17
a) requires REALTORS® to arbitrate all business disputes
b) does not require REALTORS® to arbitrate if the Board offer its mediation services
so its members can avoid litigation
c) requires REALTORS® to submit contractual disputes and specific non-contractual disputes
to mediation and/or arbitration
d) none of the above
TRUE OR FALSE
T 9. The REALTOR® is only obligated to discover and disclose adverse factors reasonably apparent
to someone with expertise in those areas required by their real estate licensing authority.

T 10. To be effective, any change in compensation offered for cooperative services must be
communicated to another REALTOR® prior to the time that REALTOR® submits an offer to
purchase or lease the subject property.
T 11. REALTORS® shall disclose the existence of accepted offers, including offers with unresolved
contingencies, to any broker seeking cooperation.
F 12. REALTORS® may advertise real estate services without disclosing the name of the real estate
firm in electronic media as long as the advertisement does not include a listed property.
T 13. Websites of REALTORS® affiliated with a firm shall disclose the firm’s name as well as that
REALTOR’S® state of licensure in a reasonable and readily apparent manner.
T 14. The obligation to refrain from making false or misleading statements about other real estate
professionals, their business, or their business practices includes the duty to publish a
clarification about such statements on any electronic media which a REALTOR® controls, once
the REALTOR® knows the statement is false or misleading.
T 15. If contacted by the client of another REALTOR®, it is acceptable to discuss the terms under
which the REALTOR® might enter into a future agreement.
F 16. If approached by a seller about listing his or her property, a REALTOR® has no obligation to try
to determine if the prospect is subject to another valid exclusive agreement.
F 17. REALTORS® shall not induce clients of their current firm to cancel exclusive contractual
agreements with that firm while they are still affiliated with the firm, but they may do so after their
affiliation with the firm is terminated.
(Standard of Practice 16-20)
18. Explain the difference between a “client”, “customer” and “prospect”.
CLIENT-
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-
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-
A purchaser, seller, tenant, or landlord who is not subject to a representation relationship with the
REALTOR® or REALTOR’S® firm
DESCRIBE What is the Code of Ethics? It is a collection of 17
IMPORTANCE Articles: 17 statements of do’s and don’ts.
OF SEMINAR
But the Code of Ethics is more. The Code of Ethics is what
makes REALTORS® different from real estate licensees;
it is what REALTORS® agree to abide by when applying
for membership in the local Association of REALTORS®;
it is the core of the REALTOR® organization.
Former NAR Executive Vice President Bill North
describes licensing laws as the lowest common
denominator of permissible performance. The Code of
Ethics, on the other hand, describes the optimum
performance the public has the right to expect.
This seminar will provide a thorough overview of the Code
of Ethics and its proper enforcement. This seminar will
also provide you with a new or better understanding of the
Code of Ethics as not only a collection of do’s and don’ts,
but more importantly a valuable source of guidance.

HISTORY OF
CODE OF
ETHICS
INSTRUCTOR’S NOTE: When teaching new agents,
include entire history section. When teaching more
experienced agents, you may want to shorten this section,
primarily stressing the longevity and constancy of the Code
of Ethics.)
Before the establishment of the National Association of
REALTORS®, the real estate business consisted primarily
of rampant land speculation and exploitation. There were
no rules and no licensing agencies. It was a period of
“caveat emptor” (buyer beware).
The National Association of REALTORS® was founded in
1908; and its first objective was to establish “Rules of
Conduct.”
The official Rules of Conduct, which we now call the Code
of Ethics, was adopted in 1913 and made a condition of
membership in 1924.

HISTORY OF
CODE OF
ETHICS
(Cont’d)
(OH)
The adoption of the Code of Ethics pre-dates by nine years
the first real estate licensing law adopted. In fact, most
licensing laws were originally patterned after the Code of
Ethics.
The Rules of Conduct were founded upon the Golden Rule:
“Do unto others as you would have them do unto you.” The
preamble of today’s Code of Ethics still credits the Golden
Rule.
The first Rules of Conduct began with the following
paragraph:
“The real estate agent should be absolutely honest,
truthful, faithful and efficient. He should bear in mind that
he is an employee -- that his client is his employer and is
entitled to the best service the real estate man can give -- his
information, talent, time, services, loyalty, confidence and
fidelity.”
This set the tone for the original 23 Articles that followed.

HISTORY OF
CODE OF
ETHICS
(Cont’d)
(OH)
The Code contained 23 Articles until 1995. It has been
amended several times to keep up with the changing world
and industry in which REALTORS® operate. In 1995, the
Code underwent a major structural overhaul. Six Articles
were eliminated and their principles were added to other
Articles or the Preamble. The remaining 17 were
renumbered and divided into three sections: Duties to
Clients and Customers (Articles 1-9); Duties to the Public
(Articles 10-14); and Duties to REALTORS® (Articles
15-17).
The Code of Ethics places social, moral, ethical and legal
requirements on REALTORS® that are above and beyond
those imposed by state licensing law.

GUIDANCE TO
REALTORS® The Code provides guidance on almost every aspect of a
REALTOR’S® daily business practice, either specifically
or generally.
The purpose of the following section will be to
review and discuss the Articles of the Code of Ethics.
The discussion will include information found in the
Standards of Practice and Case Interpretations.

DEFINITIONS:
(OH)
Note: The definitions
for “client” and
“customer were
changed in 1998.
(OH)
(OH)
(OH)
The terms “client” and “customer” are found throughout
the Code. Knowing the definition of these words is
essential to understanding the Code.
From The Code of Ethics & Arbitration Manual:
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.
Informed Consent - A person’s approval based on a full
disclosure of facts needed to make the decision intelligently
(i.e., knowledge of liability involved, alternatives, etc.)
Agent means a real estate licensee (including brokers and
sales associates) acting in an agency relationship as
defined by state law or regulation.
Prospect means a purchaser, seller, tenant, or landlord
who is not subject to a representation relationship with the
REALTOR® or REALTOR®’s firm

(OH)
Student Manual
pg 5
Preamble
Key Concepts in the
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
 Be informed on
issues affecting real
estate.
 Willingly share
your experience
and study.
 The elimination of
practices which
may damage the
public, or bring
discredit or
dishonor to the real
estate profession.
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.
 Urge the exclusive
representation of
clients.
 Not attempting to
gain any unfair
advantage over
competitors.
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®.
 Refrain from
unsolicited
comments about
other practitioners
and offering any
opinions about
competitors in an
objective and
professional
manner.
 Bring violations of
the public trust to
the attention of
their local
association.

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
(OH)
Basic Concepts of
Article 1
 Protect and
promote the
interests of the
client.
 Treat all parties
honestly.
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)
(INSTRUCTOR’S NOTE: Year after year, nearly 90% of
all ethics complaints filed in Virginia allege a violation of
Article 1.)
Student Manual
Page 5
This is the first of
many changes intended
to address doing
business on the Internet
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. (Amended 1/07)

Student Manual
Page 6
DUTIES TO
CLIENTS AND
CUSTOMERS
(Cont’d)
These are not exact
quotes. These are the
general meanings of
the SOP’s. Encourage
students to read along
as you offer these
descriptions.
You may want to
discuss Standards of
Practice 1-6, 1-7, and
1-8 at length, as they
have raised many
questions in Virginia
REALTORS® may represent both the buyer/tenant and the
seller/landlord in the same transaction, but only after full
disclosure and the informed consent of both parties.
(Adopted 1/93)
1-6 requires us to transmit all offers and counter-offers as
quickly as possible. The word “objectively” has also been
added to clarify how these offers should be presented.
Standard of Practice 1-7 and 1-8
Standards of Practice 1-7 and 1-8 deal with what happens
after an offer has been accepted by a client. REALTORS®
are not obligated to continue to market a property or show
their client additional properties after an offer has been
accepted unless agreed upon otherwise with their client. If
an additional offer is presented, or if there is a question
about the termination of an existing contract,
REALTORS® must recommend that their clients seek
legal advice prior to taking action on a subsequent offer
except when the offer is contingent on the termination of
the first contract or lease.

DUTIES TO
CLIENTS AND
CUSTOMERS
Cont’d
NAR counsel advises that agency law requires an agent to
advise his principal of all offers, both written and oral, as
well as bona fide expressions of interest. Agency law does
not authorize the REALTOR® to determine which offers to
present and which to ignore. The REALTOR® should
transmit all offers, with appropriate advice as to the
unenforceability of oral offers. Such action takes the
REALTOR® out of the middle and leaves the decision to
the client, where it belongs.
NAR also advises that the REALTOR® is obligated to
present subsequent offers while making the seller/landlord
aware of the potential consequences for breaching any
existing contract of sale and recommending that legal
advice be sought. This duty to present offers/counter-offers
and recommend legal counsel be obtained is also
applicable for buyer agents. Third, REB Regulations
require that written offers be presented. These Standards of
Practice encompass that regulation and go a step beyond by
requiring that all offers and counter-offers be presented.
The Code of Ethics often establishes obligations above and
beyond the law.

DUTIES TO
CLIENTS AND
CUSTOMERS
(Cont’d)
This Standard of
Practice clarifies the
requirement to keep
certain information
confidential. Even after
an agency relationship
has ended,
REALTORS® must not
disclose the confidential
information learned in
the course of their
agency relationship with
a client. NAR has
developed four
exceptions to that rule
that are detailed in this
Standard of Practice.
Discuss what “latent
defects” are. This does
not obligate
REALTORS® to
communicate the
existence of “latent
defects” but protects
them from Ethics
complaints if they do.
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 the
termination of the agency relationship or any non-agency
relationships recognized by law. REALTORS® shall not
knowingly, during or following the termination of a
professional relationship with their client:
1. reveal confidential information of the client; or
2. use confidential information of the client to the
disadvantage of the client; or
3. use confidential information of the client for the
REALTOR®’s advantage or the advantage of a third
party unless:
a) the client consents after full disclosure; or
b) the REALTOR® is required by court order; or
c) it is the intention of the client to commit a crime and
the information is necessary to prevent the crime; or
d) it is necessary to defend the REALTOR® or the
REALTOR®’s employees or associates against an
accusation of wrongful conduct.
Information concerning latent material defects is not
considered confidential under this Code of Ethics.
Amended (1/01)

Student Manual
Page 6
DUTIES TO
CLIENTS AND
CUSTOMERS
(Cont’d)
(OH)
(OH)
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;
This is not a change
in law or practice, but
it adds another
disclosure duty. It is
a companion piece to
SOP 1-12.
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)
-15TOn response to inquiries from buyers
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, REALTORS® shall also disclose,
if asked, whether offers were obtained by the
listing licensee, another licensee in the listing
firm, or by a cooperating broker. (Adopted
1/03, Amended 1/09)

Standard of Practice 1-16 (New)
(OH) REALTORS® shall not access or use, or permit or
enable others to access or use, listed or managed
property on terms or conditions other than those
authorized by the owner or seller. (Adopted 1/12)
(OH)
Class Exercise
(Instructor’s Note: Ask participants to choose a partner
and read silently Case 1-28. Encourage participants to
discuss case briefly with their partner. Instructor should
Student Manual
Page 14
lead a discussion and provide NAR’s answer.)
Case Interpretation 1-28: Disclosure of Existence of Offers to Prospective
Purchasers
Seller S listed her home for sale with REALTOR
®
B. The property was priced reasonably
and REALTOR
®
B was confident it would sell quickly. The listing agreement included the
seller’s authorization for publication in the MLS and authority to disclose the existence
of offers to prospective purchasers.
Within days, REALTOR
®
B had shown the property to several prospective purchasers and
one of them, Buyer Z, wrote a purchase offer at close to the asking price.
REALTOR
®
B called Seller S to make an appointment to present the offer. After hanging
up with Seller S, REALTOR
®
B received another call, this time from REALTOR
®
A.
REALTOR
®
A explained that he represented a buyer who was interested in making an
offer on Seller S’s property. REALTOR
®
A explained that while his buyer-client was quite
interested in the property, price was also a concern. He asked REALTOR
®
B if there were
other offers on the property, indicating that his buyer-client would likely make a higher
offer if there were competing offers on the table. REALTOR
®
B responded telling
REALTOR
®
A, “That’s confidential information. Please tell your client to make his best
offer.”
Taken aback by REALTOR
®
B’s comments, REALTOR
®
A shared them with his buyer-
client, who chose not to make an offer and instead pursued other properties.
Buyer Z’s offer was accepted by Seller S later that evening and, sometime later, the
transaction closed.
Several months afterward, Seller S and REALTOR
®
A met at a social event. REALTOR
®
A
related his conversation with REALTOR
®
B. Seller S asked REALTOR
®
A if he thought that
REALTOR
®
A’s buyer-client would have made an offer on Seller S’s home absent

REALTOR
®
B’s refusal to disclose whether there were other offers pending. REALTOR
®
A
responded that it was impossible to tell for certain, but his buyer-client had certainly not
been favorably impressed by REALTOR
®
B’s response to a seemingly routine question.
Seller S subsequently filed an ethics complaint against REALTOR
®
B alleging violation of
Article 1 as interpreted by Standard of Practice 1-15. He noted that he had clearly
authorized REALTOR
®
B to disclose to buyers and cooperating brokers the existence of
pending offers and that REALTOR
®
B’s arbitrary refusal to share information he was
authorized to share could have been the reason, or part of the reason, why REALTOR
®
A’s
client had chosen not to make an offer on Seller S’s home.
REALTOR
®
B defended his actions indicating that while he agreed that he had an
obligation to promote Seller S’s interests, his obligation to REALTOR
®
A and to
REALTOR
®
A’s buyer-client was simply to be honest. He had not, in any fashion,
misrepresented the availability of Seller S’s property. Rather, he had simply told
REALTOR
®
A to encourage his client to make her best offer. “I’m not required to turn
every sale into an auction, am I?” he asked rhetorically. “I feel that I treated all parties
honestly and fairly,” he concluded.
(INSTRUCTOR'S NOTE: OBTAIN FEEDBACK FROM THE GROUP BEFORE
GIVING NAR'S ANSWER.)
The Hearing Panel did not agree with REALTOR
®
B’s reasoning, indicating that he had
violated Article 1 as interpreted by Standard of Practice 1-15. They noted that Standard
of Practice 1-15 requires REALTORS
®
, if they have the seller’s approval, to divulge the
existence of offers to purchase on listed property in response to inquiries from either
potential buyers or from cooperating brokers. REALTOR
®
B had not met that obligation
and, consequently, the Hearing Panel concluded that REALTOR
®
B had violated Article 1.

DUTIES TO
CLIENTS AND
CUSTOMERS
(Cont’d)
(OH)
Basic Concepts of
Article 2 “Property or
transaction
disclosure” article
Clarifies obligation to
discover and disclose
adverse factors
ARTICLE 2
Student Manual
Page 6
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
(INSTRUCTOR’S NOTE: Ethics complaints filed in
Virginia frequently allege a violation of Article 2.)
REALTORS® are only obligated to discover adverse
factors that are reasonably apparent, but this discovery is
restricted to those areas of expertise required by the
REALTOR®’s real estate licensing authority.
REALTORS® are not obligated to discover and disclose
hidden defects in the property or to be an expert in other
professional or technical disciplines such as architecture,
structural engineering, etc.

Virginia's Seller Disclosure law defines stigmatizing
events (such as ghost, murders, etc.) that had no material
effect on the property as non-material. Standard of
Practice 2-5, combined with this disclosure law, releases
Virginia's REALTORS® from the obligation of
disclosing stigmatizing events.
(OH)
Class Exercise
lead a discussion and provide NAR's answer.)
Student Manual
Page 15
CASE INTERPRETATION 2-5: Ascertainment and Disclosure of Pertinent Facts
Mrs. A, a retired college professor, came to the office of REALTOR
®
B, a cooperating
broker, in search of a large house in which she could occupy a small apartment, using the
remainder of the building to operate a residential club for graduate students. What she
had in mind was a deluxe “rooming house” in which the tenants would have use of a
parlor, dining room, kitchen, and laundry. She felt confident, from previous experience in
the community that she could obtain from 10 to 16 “roomers”, and indicated that she
would be guided in her charges to the tenants by the amount of mortgage payments she
would have to make.
Most of the large houses on the market were inadequate. Finally, REALTOR
®
B located a
massive old mansion listed with REALTOR
®
C that appealed to Buyer A. After repeated
visits to the house and after discussing financing with a local lending institution, Buyer A
said she was interested in the house if it could accommodate as many as 11 tenants.
REALTOR
®
B accompanied her for another inspection to check on this point.
By planning double occupancy of the large bedrooms she found she could accommodate
eight roomers. In addition, there were three small rooms upstairs that had been used for
storage which REALTOR
®
B suggested might make acceptable single rooms. Buyer A
agreed, and the sale was made.
Two months later, the buyer filed a complaint with the local Board, charging REALTOR
®
B with failing to disclose pertinent facts. The complaint alleged that REALTOR
®
B knew

the buyer was taking on a substantial obligation with the expectation of housing 11
persons in the structure; that REALTOR
®
B had suggested that three rooms might make
acceptable single rooms; and that she had been subsequently advised by the building
department that these rooms could not be used as dwelling rooms since the windows
were too small to meet code requirements. She had been advised that it would cost
$1,480 to replace the windows. She charged REALTOR
®
B with negligence in not advising
her of this deficiency. After reviewing the complaint, the Grievance Committee referred
it for hearing before a Hearing Panel of the Professional Standards Committee.
At the hearing, REALTOR
®
B acknowledged the facts set out in Buyer A’s complaint, but
advised that the complaint did not state all of the relevant facts. With respect to the house
in question, as with many other houses shown to Buyer A, he had made a special check at
city hall as to zoning regulations to be sure that the kind of occupancy intended by the
buyer would be lawful; that the buyer’s specifications were unusual and that in
attempting to meet them, he had devoted an unusual amount of time and effort to help her
realize her objective; and that he had acted in good faith and had not deliberately failed to
disclose any pertinent fact but had, in fact, urged the buyer to consult with an engineer
and to check with the zoning authorities prior to making an offer to ensure that the
property could be utilized as a residential club.
The Hearing Panel found that REALTOR
®
B had satisfied his duty to the buyer by
recommending that the advice of experts be sought out and considered by the buyer prior
to making an offer to purchase.
REALTOR
®
B was found not in violation of Article 2.

DUTIES TO
CLIENTS AND
CUSTOMERS
Cont’d
Student Manual
Page 7
(OH)
The second sentence of
this Article was added in
1995 to clarify that
although you are
required to cooperate
with your fellow
REALTORS®, you are
not automatically
required to compensate
them for their efforts.
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)
Cooperation is usually in the best interest of a client, as it
broadens the market exposure of the listed property.
However, if you have a valid reason for believing that
cooperation would not further the best interests of your
client or if the client instructs you to withhold cooperation,
you may choose not to cooperate. Be prepared to justify
your refusal to cooperate.
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

(OH)
cooperating brokers before beginning efforts to accept the
offer of cooperation. (Amended 1/99)
Standard of Practice 3-2 (Amended)
To be effective, any change of in compensation offered
for cooperative services must be communicated to the
other REALTOR®
prior to the time that REALTOR®
submits an offer to purchase/lease the property. (Amended
1/10)
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)
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)
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)
New language was
added to 3-6 to clarify
that “accepted offers”
include “offers with
unresolved
contingencies”
(OH)
Note: 2011 wording
change in SOP 3-7 from
“representational status”
to “relationship with the
client”
(OH)
NAR has interpreted this Article as requiring
REALTORS® to disclose the existence of an accepted
offer to any broker seeking cooperation.
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 relationship with the client. (Amended 1/11)
Do not misrepresent the availability of access to show a
listed property.
REALTORS shall not provide access to listed property on
terms other than those established by the owner or the
listing broker. (Adopted 1/10)

(OH)
New SOP stresses best
interest of clients The duty to cooperate established in Article 3 relates to the
obligation to share information on listed property, and to
make property available to other brokers for showing to
prospective purchasers/tenants when it is in the best
interests of sellers/landlords. (Adopted 1/11)
(OH)
Class Exercise (Instructor’s Note: Ask participants to choose a partner
lead a discussion and provide NAR's answer.)
Student Manual
Page 16
Case Interpretation 3-7: Time at Which Modification to Offer of Compensation is
Communicated is a Determining Factor
(Student version will not contain strike-through language showing revisions. The
revisions are presented solely for the instructor’s information.)
REALTOR®
A listed Seller X’s home and filed the listing with the MLS. The
property data sheet indicated the compensation REALTOR®
A was offering to the
other Participants if they were successful in finding a buyer for Seller X’s home.
During the next few weeks, REALTOR®
A authorized several Participants of the
Multiple Listing Service, including REALTOR®
C, to show Seller X’s home to
potential buyers. Although several showings were made, no offers to purchase
were forthcoming. REALTOR®
A and Seller X, in discussing possible means of
making the property more salable, agreed to reduce the listed price. REALTOR®
A also agreed to lower his commission. REALTOR®
A changed his compensation
offer in the MLS and then called the MLS Participants who had shown Seller X’s
property to advise them that he was modifying his offer of compensation to
cooperating brokers. Upon receiving the call, REALTOR®
C responded that he
was working with Prospect Z who appeared to be very interested in purchasing the
property and who would probably make an offer to purchase in the next day or
two. REALTOR®
C indicated that he would expect to receive the compensation
that had been published originally in the MLS and not the reduced amount now
being offered to him, since he had already shown the property to Prospect Z and

expected an offer to purchase would be made shortly. REALTOR®
A responded
that since Prospect Z had not signed an offer to purchase and no offer had been
submitted, the modified offer of compensation would be applicable.
The following day, REALTOR®
C wrote an offer to purchase for Prospect Z. The
offer was submitted to the Seller by REALTOR®
A and was accepted. At the
closing, REALTOR®
A gave REALTOR®
C a check for services in an amount
reflecting the modified offer communicated to REALTOR®
C by phone.
REALTOR®
C refused to accept the check indicating that he felt REALTOR®
A’s
actions were in violation of the Code of Ethics. REALTOR®
C filed a complaint
with the Board’s Grievance Committee alleging violation of Articles 2 and 3 on
the part of REALTOR®
A citing Standard of Practice 3-2 in support of the charge.
During the hearing, REALTOR®
C stated that REALTOR®
A’s modification of the
compensation constituted a misrepresentation through concealment of pertinent facts
since he had not provided REALTOR®
C with specific written notification of the
modification prior to the time REALTOR®
C began his efforts to interest the purchaser in
the listed property. REALTOR®
A defended his actions by indicating that timely notice
of the modification of compensation offered had been provided to REALTOR®
C by
telephone prior to REALTOR®
C obtaining submitting a signed offer to purchase.
REALTOR®
A also indicated that his modified offer of compensation had been
bulletined to all Participants, including REALTOR® C, through the MLS. REALTOR®
A also noted that in accordance with Standard of Practice 3-2, the modified compensation
offer had been communicated to REALTOR®
C prior to the time the purchaser signed an
that REALTOR® C had submitted the signed offer to purchase. REALTOR®
A also
commented that had REALTOR®
C produced submitted the signed offer to purchase
prior to REALTOR®
A communicating the modified offer, then REALTOR®
A would
have willingly paid the amount originally offered.
Based on the evidence presented to it, the Hearing Panel concluded that REALTOR®
A
had acted in accordance with the obligation expressed in Standard of Practice 3-2 based
on changing the offer of cooperative compensation in the MLS alone, even without the
courtesy phone calls, and consequently was not in violation of Articles 2 or 3.

DUTIES TO
CLIENTS AND
Student Manual Page 7
ARTICLE 4
CUSTOMERS
(Cont’d)
(OH)
Article 4 requires
REALTORS® to
disclose any ownership
interest they have in a
property when buying or
selling. This disclosure
must be in writing.
(OH)
"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)
NAR adopted the following definition of "immediate
family" for Article 4: "As used in the Code of Ethics, the
term 'immediate family' includes, but is not limited to, the
REALTOR® and the REALTOR®'s spouse and their
siblings, parents, grandparents, children (by birth or
adoption), grandchildren and other descendants."
When REALTORS® are involved in a purchase or sale for
their "firm or any member thereof", they must disclose this
relationship, because it can be presumed that most
individuals would tend to favor the interests of business
colleagues over the interest of strangers.

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)
DUTIES TO
CLIENTS AND
CUSTOMERS
(Cont’d)
(OH)
Article 5 prevents
REALTORS® from
using their professional
knowledge to gain an
unfair advantage in a
real estate transaction.
REALTORS® must
utilize care in any real
estate transaction that
could be seen as
benefiting the
REALTOR® either
directly or indirectly.
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."
(OH) 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)
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)
(OH)
Article 7 not only
requires disclosure, but
also requires that the
REALTOR® obtain the
informed consent of the
client.
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)
Student Manual
Page 7

DUTIES TO
CLIENTS AND
CUSTOMERS
Cont’d
(OH)
Student Manual
Page 8
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."
REALTORS® must exercise great care whenever they
handle other people’s money. Never keep deposits or
other payments in your office any longer than necessary.
DUTIES TO
CLIENTS AND
CUSTOMERS
Cont’d
(OH)
The basic premise of this
Article is that all
agreements should be in
writing and each party
should be given a copy.
ARTICLE 9
REALTORS®, for the protection of all parties, shall
assure whenever possible that 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)

(INSTRUCTOR NOTE:)
VAR statistics reveal that
Article 9 is generally the
source of the highest
number of actual violations
in Virginia.
REALTORS® are obligated to exercise reasonable care to
ensure that these documents are kept current through the
use of written extensions or amendments.
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
(OH)
Note additional
prohibitions against
“sexual orientation”
Student Manual
Page 8
(OH)
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, or sexual orientation. 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, or sexual orientation.(Amended 1/11)
REALTORS® are required to avoid two specific
types of behavior that are discriminatory:

REALTORS
®
shall not deny equal professional services
to any person for reasons of race, color, religion, sex,
handicap, familial status, or national origin, or sexual
orientation. 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, or sexual
orientation. (Amended 1/11)
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, or sexual
orientation. (Amended 1/11)
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)

(OH)
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, national origin
or sexual orientation. (Amended 1/11)
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)
(OH)
Student Manual
Pages 9-11
(OH)
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, land 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 1/10)
(OH) 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 unless the party
requesting the opinion requires a specific type of report or
different data set:
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 1/10)

This was a new Standard of Practice in 1996 to cover a
REALTOR®’s actions when providing consultative services.
When acting as a counselor, REALTORS® should render
advice in an objective manner and their fee should not be
contingent on the substance of their advice.

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 01/02)

DUTIES TO
THE PUBLIC
(Cont’d)
Student Manual
Page 9
The “Truth in
Advertising” Article
(OH)
(OH)
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)
Clarifying and
enhancing language in
Article 12 is intended
to ensure that its
historic true picture
test applies to all
REALTOR®
communications,
including those made
electronically (e.g. via
the internet, email, text
messaging or through
other methods)
SOP: 12-5 (Amended 1/10 and 1/11)
REALTORS®
shall not advertise nor permit any person
employed by or affiliated with them to advertise real estate
services or 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. This Standard of
Practice acknowledges that disclosing the name of the firm
may not be practical in electronic displays of limited
information (e.g., thumbnails”, text messages, “tweets”,
etc.). Such displays are exempt from the disclosure
requirement established in the Standard of Practice, but
only when linked to a display that includes all required
disclosures. (Adopted 11/86, Amended 1/10, 1/11)

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. (Amended 1/07)
The obligation to present a true picture in representations to the
public includes information presented, provided or displayed
on REALTORS®’ websites. REALTORS® shall use
reasonable efforts to ensure that information on their websites
is current. When it becomes apparent that information on a
REALTOR®’s website is no longer current or accurate,
REALTORS® shall promptly take corrective action.
(Amended 1/07)
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. (Amended 1/07)
Standards 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. (Amended 1/07)
(OH) Standard of Practice 12-12
REALTORS
shall not:
1) use URLs or domain names that present less than a
true picture, or
2) register URLs or domain names which, if used,
would present less than a true picture. (Adopted
1/08)
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)

(OH)
CLASS EXERCISE
Case Interpretation 12-26:
Advertising Role in Sales After Changing Firm Affiliation
Student Manual
Page 17
REALTOR® P was a non-principal broker licensed with XYZ, REALTORS®
whose forte was listing residential property. Noted prominently on REALTOR®
P’s website was the banner: “Sold by REALTOR® P!” Under that banner were
addresses of nearly a hundred properties REALTOR® P had listed, and which had
been sold either through REALTOR® P’s efforts or through the efforts of
cooperating brokers.
Seeking new opportunities, REALTOR® P ended his relationship with XYZ and
affiliated with ABC, REALTORS®. REALTOR® P promptly revised the
information on his website to prominently display the name of his new firm in a
readily apparent manner. He also continued to display the lengthy list of
properties that he had listed, and which had sold, while REALTOR® P was
affiliated with XYZ.
His departure from XYZ had been on good terms, so REALTOR® P was taken
aback to receive a complaint brought by his former principal broker, REALTOR®
D, alleging that REALTOR® P’s website display of sold listings violated Article
12, as interpreted by Standard of Practice 12-7.
At the hearing, the complainant noted that Standard of Practice 12-7 provides, in
relevant part, “Only REALTORS® who participated in the transaction as a listing
broker or cooperating broker (selling broker) may claim to have ‘sold’ the
property.” “It was XYZ, REALTORS®,” REALTOR® D added, “that was the
listing broker in these transactions, not our former sales associate, REALTOR® P.
His advertising of our listings and sales under the banner of his new firm ABC,
REALTORS®, is unauthorized and misleading to consumers who will get the
impression that ABC was involved in these transactions when that is simply not
true.”

REALTOR® P defended himself and his website pointing out that he had listed each of
the properties displayed on his website, and the only thing that had changed was his firm
affiliation. He directed the hearing panel’s attention to the disclaimer at the end of the
list of properties that read, “Each of these properties was listed by REALTOR® P over
the past seven years. For much of that time, I was affiliated with another firm.”
The hearing panel agreed with REALTOR® P’s defense, noting that consumers would
understand that some of the sales had occurred while REALTOR® P was affiliated with
a different firm. Consequently, REALTOR® P was found not in violation of Article 12.

CLASS EXERCISE
Case Interpretation 12-25: Advertising Role in Sales After Changing
Firm Affiliation
Student Manual
Page 18
(INSTRUCTOR NOTE: This case is also related to SOP
12-7. Note the contrast with the defense presented in Case
12-26. Have participants read the case silently and be
prepared to discuss the reasoning for their conclusion.)
REALTOR®
Q was a non-principal broker licensed with ABC, REALTORS®
.
REALTOR®
Q specialized in buyer representation. A prominent feature on her website
carried the headline “I sold these – and I can help you buy or sell, too!”. Under the
headline was a list of over a hundred street addresses of properties for which
REALTOR®
Q had found buyers.
For personal and professional reasons, REALTOR®
Q chose to leave the ABC firm to
affiliate with XYZ, REALTORS®
. As she transitioned to her new firm, REALTOR®
Q
was careful to disclose the name of her new firm in a readily apparent manner on her
website. Her website also continued to display the list of properties she had found buyers
for during her time with the ABC firm.
REALTOR®
Q’s parting with ABC had been amicable, so she was surprised to receive a
complaint brought by her former principal broker, REALTOR®
C, alleging a violation of
Article 12, as interpreted by Standard of Practice 12-7, based on her website’s display of
sales made while REALTOR®
Q had been affiliated with ABC.
At the hearing, REALTOR®
C, the complainant, noted that Standard of Practice 12-7
provides, in part, “Only REALTORS®
who participated in the transaction as the listing
broker or cooperating broker (selling broker) may claim to have ‘sold’ the property.” “It
was ABC, REALTORS®
,” REALTOR®
C added, “that was the selling broker in these
transactions, not our former sales associate REALTOR®
Q. Her advertising our sales
under the umbrella of her new firm, XYZ, REALTORS®
, is confusing at best, and
potentially misleading to consumers who may get the impression the XYZ firm was
involved in these transactions when that’s not the case.”
REALTOR®
Q defended herself and her website arguing that the fact that she had found
the buyers for each of the properties listed on her website was still true, and that the only
thing that had changed was her firm affiliation. “If it was true when I was licensed with
ABC, then it’s still true even though I’m now licensed with XYZ,” she reasoned.

(INSTRUCTOR NOTE: OBTAIN FEEDBACK FROM THE GROUP BEFORE GIVING
NAR'S ANSWER.)
The hearing panel agreed that REALTOR®
Q had, in fact, sold the properties, albeit
while licensed with ABC. The ad, however, suggested that the sales were made while the
REALTOR®
Q was licensed with XYZ, which was not the case. Consequently
REALTOR®
Q was found in violation of Article 12.

CLASS EXERCISE
Case Interpretation 12-21: Registration of URL Similar to Name of
Subsequently–Established Firm
Student Manual
Page 19
REALTOR®
Z was the technology–savvy partner in the XYZ residential
real estate firm in the north woods. She was also a former advertising
executive who was constantly looking at new and innovative ways to
position and market the XYZ firm. While her partners had consistently
resisted her suggestions to change the firm’s name to better reflect the
locale they served, REALTOR®
Z had, with their concurrence, registered a
number of domain names based on firm names she had to date been unable
to convince her partners to adopt. She felt this was a wise strategy since it
was only a matter of time until she would convince her partners that a name
change was beneficial. Among the domain names registered were
Northwoodsrealestate.com, woodsandlakesrealty.com, and
upnorthrealestate.com. None of those names were, to the best of
REALTOR®
Z’s knowledge, similar to the names of other area real estate
brokerage companies.
Approximately a year later Sales Associate B received his broker’s license,
left the XYZ firm, and opened his own brokerage firm which he named Up
North Real Estate. When he attempted to register the domain name
“upnorthrealestate.com” he learned it had already been registered by
REALTOR®
Z. Upset with this turn of events, he filed ethics complaints
with the local association of REALTORS®
charging REALTOR®
Z and her
partners with having violated Article 12 of the Code of Ethics, as
interpreted by Standard of Practice 12-12.
Z defended her actions in registering the
domain name “upnorthrealestate.com” on the grounds she had been actively
lobbying her partners to change the firm’s name to Up North Real Estate;
that she had no intention of using the domain name
“Upnorthrealestate.com” until the firm’s name was changed and that at the
time she had registered the domain name no other firm that she was aware
of had a similar, let alone identical, name. Moreover, she argued, a domain
name does not have to mirror a firm’s name; it merely has to present a “true

picture”. “The XYZ firm has listed and sold residential property in the
north woods for many years. ‘Up north’ is traditionally used by residents
and visitors to refer to our area,” she continued. “While I hoped to
convince my partners to change the name of our firm to ‘Up North Real
Estate’ at some point, if the XYZ firm had used the domain name–which we
haven’t–it still would have satisfied Article 12’s true picture requirement
since it refers to a particular geographic locale, not to a competing real
estate company.”
The hearing panel agreed with REALTOR®
Z’s reasoning, concluding that
at the time REALTOR®
Z registered the domain name
“upnorthrealestate.com”, it was not similar to the name of any other area
real estate company. The panel also noted that if it had been used, the
domain name would have satisfied Article 12’s true picture requirement
since it would have simply suggested to consumers that it was a source of
property information in that geographic area.

(OH)
Class Exercise
Case Interpretation 12-20: Misleading Use of “MLS” in URL
Student Manual
Page 20
REALTOR
A, a residential broker in a major metropolitan city, spent
several weeks each year in his cabin in the north woods where he planned to
retire one day. Even while at home in the city, REALTOR
A stayed abreast
of local news, events, and especially the local real estate market by
subscribing to the print and on-line editions of the local newspaper. He also
bookmarked a number of north woods brokers’ websites to stay current with
the market and to watch for potential investment opportunities.
One evening while surfing the Internet, REALTOR
A came across a URL
he was unfamiliar with – northwoodsandlakesmls.com. REALTOR
A was
pleased to see the MLS serving the area where he vacationed for so many
years had created a publicly-accessible website. Clicking on the link, he was
surprised to find that the website he was connected with was not an MLS’s
website but instead was REALTOR
Z’s company website. Having had prior
dealings with REALTOR
Z, REALTOR
A spent some time carefully
scrutinizing the website. He noted, among other things, that the name of
REALTOR
Z’s firm did not include the letters MLS.
REALTOR
A sent an e-mail to the association’s executive officer asking
whether REALTOR
Z had been authorized by the association to use the
URL northwoodsandlakesmls.com and whether the association felt it
presented a true picture as required by Article 12 of the Code of Ethics. The
association executive responded that their association did not assign, review,
or approve URLs used by their members, but added that if REALTOR
A felt
a possible violation of the Code of Ethics had occurred, the appropriate step
was to file an ethics complaint. REALTOR
A did just that, alleging in his
complaint that when he clicked on what appeared to be a real estate–related
URL that included the letters “MLS” he expected to be connected with a
website operated by a multiple listing service. He stated he felt that
REALTOR
Z’s URL was deceptive and did not meet Article 12’s true
picture test.

At the hearing, REALTOR
Z defended his URL on a number of grounds
including the fact that he was a participant in good standing in the MLS and
that he was authorized under the MLS’s rules to display other participants’
listings on his website. “If I used ‘MLS’ in the name of my firm, I could see
how that might be perceived as something less than a true picture,” he
argued, “but by simply using MLS in my URL I am telling consumers that
they can get MLS–provided information about properties in the north woods
from me. What could be truer than that?”
The hearing panel disagreed with REALTOR
Z’s reasoning. While
REALTOR
Z’s website included information about other participants’
listings that the MLS had provided – and that REALTOR
Z was authorized
to display – the fact remained that a real estate–related URL that included
the letters MLS would lead reasonable consumers to conclude that the
website would be an MLS’s, and not a broker’s website. REALTOR
Z was
found in violation of Article 12 as interpreted by Standard of Practice 12-10.
Instructor Note: Refer participants to SOP 12-10 in their copy of the COE.

(OH)
DUTIES TO
THE PUBLIC
Cont’d
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."
Student Manual
Page 10
(OH)
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 tribunal 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)
Although every local association or affiliate chapter you
hold membership can process a complaint against you,
only one hearing is allowed for each incident.
Avoid unnecessary discussions of the details of any ethics
or arbitration hearing.

The REALTOR® 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. (Amended 1/99)
The filing of multiple ethics complaints based on the same
event or transaction with the intent of impeding the
Board's proceedings is prohibited.
DUTIES TO
REALTORS®
(OH)
REALTORS® must use
care when making
remarks about any real
estate professionals,
their businesses, or their
business practices.
ARTICLE 15 (Amended)
"REALTORS® shall not knowingly or recklessly make
false or misleading statements about their competitors,
other real estate professionals, their businesses, or their
business practices." (Amended 1/12)

(OH)
(OH)
The obligation to refrain from making false or misleading
statements about competitors other real estate
professionals, competitors’ their businesses, and
competitors’ their business practices includes the duty to
not knowingly or recklessly publish, 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,
Amended 1/10 and 1/12)
The obligation to refrain from making false or misleading
statements about competitors other real estate
professionals, competitors’ their businesses, and
competitors’ their business practices includes the duty to
publish a clarification about or to remove statements made
by others on electronic media the REALTOR®
controls
once the REALTOR®
knows the statement is false or
misleading. (Amended 1/12)

DUTIES TO
REALTORS®
(Cont’d)
(OH)
ARTICLE 16Student Manual
Page 10
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)
Competition among brokers is extremely intense until the
prospect enters into a binding agreement. When an agency
relationship has been established, Article 16 comes into play.
Examples of actions inconsistent with the agency of the listing
broker include:
 subagent providing unauthorized information to a purchaser
 buyer representative or subagent contacting the owner
directly (without the listing broker’s permission) to show the
property
 subagent taking an offer directly to the client without the
knowledge and consent of the listing broker
Article 16 does not prohibit general advertising (telephone
canvassing, mailings to all property owners in a given area, etc.)
even though a recipient may currently have an agency
relationship with another REALTOR®. Many REALTORS®
also include a disclaimer to avoid any misunderstanding.

If the listing broker refuses to disclose the expiration
date and nature of the listing, REALTORS® may contact the
property owner directly to secure information on the status of
the listing. In such a situation, REALTORS® may also discuss
the terms upon which they might take a future listing or may
take a listing which would become effective upon expiration of
any existing exclusive listings.
Student Manual
Pages 10-11
If a buyer broker refuses to disclose the expiration date and
nature of the exclusive buyer/tenant agency agreement,
REALTORS® may contact the buyer/tenant directly to secure
information on the status of the agreement. In such a situation,
REALTORS® may also discuss the terms upon
which they might enter into a future agency relationship or
may enter into an agency agreement which would become
effective upon expiration of any existing exclusive agency
agreement.
NAR has recommended that each firm establish an office
policy or procedure, with regards to Standards of Practice 16-4
and 16-5. This policy should designate which individual(s)
will handle these types of inquiries (e.g., listing agent, office
manager, receptionist, etc.) The firm may also establish a
procedure to verify who is making the request, such as a

requirement that requests be in writing, or that information will
not be provided over the telephone immediately, but rather will
be provided in the form of a “call back” to the inquiring
REALTOR®.
If the client of another REALTOR® initiates the discussion, a
REALTOR® can discuss the terms upon which he might enter
into a future agency relationship with a client of another
REALTOR®. Provided the other REALTOR®’s client initiates
the discussion, the REALTOR® may also enter into an agency
relationship to become effective upon expiration of any existing
agency relationship.

DUTIES TO
REALTORS®
(Cont’d)
If the other agent’s
client initiates a deal
(e.g., asks to make an
offer) then you are
allowed to proceed.
For example, an agent
at an open house may
react when a potential
purchaser requests to
make an offer by
writing the offer and
presenting it to the
seller.
Standard of Practice Standard of Practice 16-9
Before entering into an agency relationship, use your best
efforts to make sure the client is not already subject to a
current, valid exclusive agreement with another broker to
provide the same real estate service.
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. (Amended 1/03)

DUTIES TO
REALTORS®
(Cont’d)
REALTORS® are free to enter into a contractual
agreement or negotiate with sellers/landlords or
buyers/tenants or others who are not subject to an exclusive
agreement, but shall not knowingly obligate the potential
client to pay more than one commission without their
informed consent.
You are obligated to compensate the cooperating broker
(principal) in a cooperative transaction rather than any
sales licensee affiliated with the cooperating broker unless
you have the prior express knowledge and consent of the
cooperating broker.
The REALTOR®, as subagent or buyer/tenant’s
representative, may not use the terms of an offer to
purchase/lease to attempt to modify the listing broker’s
offer of subagency or buyer agency compensation, nor may
the REALTOR® make the submission of an executed offer
contingent on the listing broker’s agreement to modify the
offer of compensation.

DUTIES TO
REALTORS®
(Cont’d)
(OH)
(OH)
REALTORS®
, prior to or after their relationship with their
current firm is terminated, 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, Amended 1/10)

CLASS EXERCISE
NEW CASE INTERPRETATION 16-19: Continued
Contact With Potential Seller Who Enters Into An
Exclusive Listing With Another REALTOR®
(INSTRUCTORS NOTE: Participants should be asked to
read silently Case 16-19. Encourage participants to
discuss the case briefly with their partner. Instructors
should lead discussion and provide NAR’s answer.)Student Manual
Pages 21-23
After a decades-long career as a noted researcher and teacher, Professor Y decided to sell
his home near the university campus in anticipation of his retirement to the northwoods.
Having lived in the home for over thirty years and realizing that the proceeds from its
sale would constitute a significant part of his retirement funds, Professor Y made
appointments with several potential listing brokers, including REALTOR®
P and
REALTOR®
Q. During each appointment, Professor Y asked extensive questions
hoping to get a clear idea of his property’s market value and each broker’s proposed
marketing strategies.
REALTOR®
Q was familiar with Professor Y’s home, having grown up on the same
block and having gone to elementary and high school with Professor Y’s children.
Consequently, REALTOR®
Q was not surprised when she received a call asking for a
meeting to discuss a possible listing of Professor Y’s home. The appointment had gone
well and REALTOR®
Q was confident she would get the listing. To her surprise, just
three days later the property came onto the market listed with REALTOR®
P.
REALTOR®
Q was taken aback and spent considerable time pondering what she had

done or said – or failed to do or say – that had led Professor Y to choose to list with
REALTOR®
P. Several times she was tempted to call Professor Y and ask why she
hadn’t been chosen, but she never made that call.
Several weeks later Professor Y’s son and daughter-in-law hosted a retirement party for
Professor Y. Their friend REALTOR®
Q was among the invited guests. At the party,
Professor Y approached REALTOR®
Q and, after exchanging pleasantries, commented,
“You’re probably wondering why I didn’t list my home with you.” “The thought
crossed my mind,” admitted REALTOR®
Q, “but you made a good choice with
REALTOR®
P. I’m certain he’ll do a fine job and get a fair price for you.” Then, since
Professor Y had raised the issue, REALTOR®
Q asked, “Why didn’t you give me the
listing?” Professor Y explained that while he thought highly of REALTOR®
Q, he had
been very impressed with REALTOR®
P’s marketing strategies, and his choice was a
business decision and not one influenced by friendships. REALTOR®
Q accepted
Professor Y’s explanation and their conversation turned to other topics. A month later,
REALTOR ®
Q was surprised to receive notice from the local association of
REALTORS®
advising she had been named in an ethics complaint alleging that her
conversation with Professor Y, after Professor Y had listed his home with REALTOR®
P, had violated Article 16 of the Code of Ethics.
Q had acknowledged she had been surprised – and
disappointed – when Professor Y listed his home with REALTOR®
P instead of with her.
She also acknowledged she discussed Professor Y’s choice of listing broker with him at
the party. In her defense, she called Professor Y as a witness. Professor Y testified that
he had in fact told REALTOR®
P, his listing broker, about his conversation with
REALTOR®
Q, adding that he had no idea that REALTOR®
P would file an ethics
complaint. He also noted he – and not REALTOR®
Q – had raised the subject of why he
had chosen to list with REALTOR®
P. “REALTOR®
Q is a longtime friend of my
family and I felt I owed her an explanation about why I listed with REALTOR®
P
instead of with her.”
REALTOR®
Q concluded her defense noting that while Standard of Practice 16-13
requires REALTORS®
to conduct dealings related to exclusively listed property with the
client’s agent, there is an exception in cases where dealings are initiated by an
exclusively-represented client. She pointed out that her conversation with Professor Y
could fairly be characterized as a “dealing” related to Professor Y’s exclusively listed
home, and that her conversation with Professor Y, since it was initiated by Professor Y,
did not violate Article 16 of the Code of Ethics.

The Hearing Panel concurred with REALTOR®
Q’s defense, and found no violation of
Article 16. (Refer participants to SOP 16-13.)
CLASS EXERCISE
New Case Interpretation #16-20: Continued Contact With Potential
Seller Who Enters Into an Exclusive Listing With Another REALTOR,
(INSTRUCTOR NOTE: Participants should be asked to read silently Case 16-19.
Encourage participants to discuss the case briefly with their partner. Instructors should
lead discussion and provide NAR’s answer. This case also refers to SOP 16-13.)
At the conclusion of a detailed listing presentation, REALTOR®
B asked the sellers
whether they had any questions. “No,” said Seller Z. “Your presentation was
professional and complete and we very much appreciate your time. We have
appointments with two other realty firms and after we talk to them we’ll make our
decision.” REALTOR®
B thanked the sellers and encouraged them to contact him with
any questions they might have. “I really look forward to being your broker,” he added.
Several days later, REALTOR®
B noticed that Seller Z’s property had come on the
market, listed with REALTOR®
A. REALTOR®
B and REALTOR®
A were friends, but
were also quite competitive, both frequently pursuing the same potential seller-clients.
“I wonder why Seller Z decided to list with REALTOR®
A,” mused REALTOR®
B; “it
won’t matter if I just call and ask why they decided to list with my friend REALTOR®
A
instead of me.” REALTOR®
B called the sellers and left a message on their answering
machine asking for a return call at their convenience.
That evening, Seller Z returned REALTOR®
B’s phone call. REALTOR®
B started the
conversation by thanking Seller Z and his wife for their time. “What I’d like to know is
why you chose to give your listing to REALTOR®
A instead of me?” he then asked.
“Don’t get me wrong, REALTOR®
A is a good broker and will do a good job for you.
I’m not suggesting you cancel your listing with REALTOR®
A but if your listing expires
and REALTOR®
A hasn’t sold it, I’d be pleased to talk to you about listing with me.”
Seller Z did not follow up on REALTOR®
B’s offer and the following weekend at
REALTOR®
A’s open house Seller Z and his wife recounted REALTOR®
B’s follow-up
phone call. Over the next few days REALTOR®
A debated filing an ethics complaint.

He weighed his friendship with REALTOR®
B against what he saw as his duty to bring
potentially unethical conduct to the attention of the association of REALTORS®
.
Somewhat reluctantly, he filed an ethics complaint alleging a violation of Article 16, as
interpreted by Standard of Practice 16-13.
A called Seller Z as a witness. Seller Z faithfully recounted
the substance of REALTOR®
B’s conversation with Seller Z and his wife, commenting
that while REALTOR®
B had said he was only trying to understand why he hadn’t been
given the listing, it appeared to Seller Z that REALTOR®
B wanted Seller Z to cancel his
listing with REALTOR®
A . Then REALTOR®
B testified in his own defense. He
acknowledged he had been aware that REALTOR®
A had already exclusively listed the
property when he contacted Seller Z and asked for a follow-up appointment. He
defended his actions stating he was not trying to induce Seller Z to cancel the listing, he
was simply trying to find out what he had said – or failed to say – that led Seller Z to list
with REALTOR®
A instead of with him, and wanted Seller Z and his wife to be fully
aware of the services he would provide if their listing with REALTOR®
A expired.
The Hearing Panel did not agree with REALTOR®
B’s defense, noting that REALTOR®
B’s curiosity or desire to enhance his listing presentation skills did not justify continued
contact with a potential seller-client after that seller had entered into an exclusive
representation agreement with another broker. REALTOR®
B was found in violation of
Article 16 as interpreted by Standard of Practice 16-13.
CLASS EXERCISE
New Case Interpretation #16-21: Continued Contact With Potential Seller Who
Enters Into an Exclusive Listing With Another REALTOR®
(INSTRUCTORS NOTE: Participants should be asked to read silently Case 16-19.
Encourage participants to discuss the case briefly with their partner. Instructors should
lead discussion and provide NAR’s answer.)
REALTOR®
P and Ms. Q had been members of the church choir for several years and
had become social friends. One evening after choir practice Ms. Q mentioned that now

that her children were grown and out of the family home, she and her husband were
seriously considering downsizing. “I’m sure I can help you with that,” said REALTOR®
P, “I’m going away for the weekend but I’ll get in touch with you early next week.”
The following Monday evening REALTOR®
P called Ms. Q. After exchanging
pleasantries, REALTOR®
P turned the conversation toward business. “I’ve identified
some comparable sales to show you and I’d like to come over and visit with you and
your husband to discuss listing your home,” she said. After a lengthy pause, Ms. Q
shared with REALTOR®
P that her husband had been very anxious to get started and
over the weekend they had visited several local real estate brokerages and had listed their
home with REALTOR®
B. “I hope you understand,” said Ms. Q, “my husband makes
all of our business decisions and he was very impressed with REALTOR®
B and his
plans for selling our house.” REALTOR®
P responded positively telling Ms. Q, “I know
REALTOR®
B. He’ll do a fine job for you. If there is ever anything I can do for you in
the future, never hesitate to call me.” On that note, REALTOR®
P and Ms. Q ended
their conversation.
The next afternoon REALTOR®
B was at the Q’s home placing his “For Sale” sign on
their front lawn. Ms. Q invited REALTOR®
B into the house for coffee. During their
conversation, she mentioned her conversation the evening before with REALTOR®
P,
commenting, “I was so relieved that REALTOR®
P wasn’t upset that I didn’t list with
her. She was very gracious and even suggested that I should call her if she could be of
assistance to us in the future.” REALTOR®
B said nothing about Ms. Q’s remark, but
after returning to his office filled out the paperwork necessary to file an ethics complaint
against REALTOR®
P, charging her with violating Article 16, as interpreted by Standard
of Practice 16-13.
At the hearing convened to consider the complaint, REALTOR®
B testified that
REALTOR®
P had directly contacted his exclusive client, Ms. Q, and after Ms. Q had
shared with REALTOR®
P the fact that the Q’s home had been listed by REALTOR®
B,
had not immediately terminated their telephone conversation. “Even worse,” said
REALTOR®
B, “REALTOR®
P told Ms. Q that she should call her if there was ever
anything she could do for her. REALTOR®
P’s offer to be of assistance ‘at any time in
the future’ was simply a thinly-veiled attempt to convince the Q’s to cancel their listing
with me and to list with her.
REALTOR®
P, testifying in her defense, noted that she did not know the Q’s property
had been listed by REALTOR®
B when she called Ms. Q; that when Ms. Q informed her
they had listed their property with REALTOR®
B she had responded courteously,
professionally, and positively, assuring Ms. Q that REALTOR®
B would do a good job
for the Qs; and that her offer was simply to be of assistance in future real estate

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