Code
of Ethics and Standards of Practice
of
the National
Association of Realtors®
Effective
January 1, 2011
Where
the word Realtors® is
used in this Code and Preamble, it shall be deemed to include Realtor-Associate®s.
Under
all is the land. Upon its wise utilization and widely allocated ownership
depend the survival and growth of free institutions and of our civilization. Realtors®
should recognize that the interests of the nation and its citizens require the
highest and best use of the land and the widest distribution of land
ownership. They require the creation of adequate housing, the building of
functioning cities, the development of productive industries and farms, and
the preservation of a healthful environment.
Such
interests impose obligations beyond those of ordinary commerce. They impose
grave social responsibility and a patriotic duty to which Realtors®
should dedicate themselves, and for which they should be diligent in preparing
themselves. Realtors®,
therefore, are zealous to maintain and improve the standards of their calling
and share with their fellow Realtors®
a common responsibility for its integrity and honor.
In
recognition and appreciation of their obligations to clients, customers, the
public, and each other, Realtors®
continuously strive to become and remain informed on issues affecting real
estate and, as knowledgeable professionals, they willingly share the fruit of
their experience and study with others. They identify and take steps, through
enforcement of this Code of Ethics and by assisting appropriate regulatory
bodies, to eliminate practices which may damage the public or which might
discredit or bring dishonor to the real estate profession. Realtors®
having direct personal knowledge of conduct that may violate the Code of
Ethics involving misappropriation of client or customer funds or property,
willful discrimination, or fraud resulting in substantial economic harm, bring
such matters to the attention of the appropriate Board or Association of Realtors®.
(Amended 1/00)
Realizing
that cooperation with other real estate professionals promotes the best
interests of those who utilize their services, Realtors®
urge exclusive representation of clients; do not attempt to gain any unfair
advantage over their competitors; and they refrain from making unsolicited
comments about other practitioners. In instances where their opinion is
sought, or where Realtors®
believe that comment is necessary, their opinion is offered in an objective,
professional manner, uninfluenced by any personal motivation or potential
advantage or gain.
The
term Realtor® has
come to connote competency, fairness, and high integrity resulting from
adherence to a lofty ideal of moral conduct in business relations. No
inducement of profit and no instruction from clients ever can justify
departure from this ideal.
In
the interpretation of this obligation, Realtors®
can take no safer guide than that which has been handed down through the
centuries, embodied in the Golden Rule, “Whatsoever ye would that others
should do to you, do ye even so to them.”
Accepting
this standard as their own, Realtors®
pledge to observe its spirit in all of their activities whether conducted
personally, through associates or others, or via technological means, and to
conduct their business in accordance with the tenets set forth below. (Amended
1/07)
Duties
to Clients and Customers
When
representing a buyer, seller, landlord, tenant, or other client as an agent, Realtors®
pledge themselves to protect and promote the interests of their client. This
obligation to the client is primary, but it does not relieve Realtors®
of their obligation to treat all parties honestly. When serving a buyer,
seller, landlord, tenant or other party in a non-agency capacity, Realtors®
remain obligated to treat all parties honestly. (Amended
1/01)
• Standard
of Practice 1-1
Realtors®,
when acting as principals in a real estate transaction, remain obligated by
the duties imposed by the Code of Ethics. (Amended
1/93)
• Standard
of Practice 1-2
The
duties imposed by the Code of Ethics encompass all real estate-related
activities and transactions whether conducted in person, electronically, or
through any other means.
The
duties the Code of Ethics imposes are applicable whether Realtors®
are acting as agents or in legally recognized non-agency capacities except
that any duty imposed exclusively on agents by law or regulation shall not be
imposed by this Code of Ethics on Realtors®
acting in non-agency capacities.
As
used in this Code of Ethics, “client” means the person(s) or entity(ies)
with whom a Realtor®
or a Realtor®’s
firm has an agency or legally recognized non-agency relationship;
“customer” means a party to a real estate transaction who receives
information, services, or benefits but has no contractual relationship with
the Realtor® or the Realtor®’s
firm; “prospect” means a purchaser, seller, tenant, or landlord who is not
subject to a representation relationship with the Realtor® or Realtor®’s
firm; “agent” means a real estate licensee (including brokers and sales
associates) acting in an agency relationship as defined by state law or
regulation; and “broker” means a real estate licensee (including brokers
and sales associates) acting as an agent or in a legally recognized non-agency
capacity. (Adopted 1/95, Amended 1/07)
• Standard
of Practice 1-3
Realtors®,
in attempting to secure a listing, shall not deliberately mislead the owner as
to market value.
• Standard
of Practice 1-4
Realtors®,
when seeking to become a buyer/tenant representative, shall not mislead buyers
or tenants as to savings or other benefits
that might be realized through use of the Realtor®’s
services.
(Amended 1/93)
• Standard
of Practice 1-5
Realtors®
may represent the seller/landlord and buyer/tenant in the same transaction
only after full disclosure to and with informed consent of both parties.
(Adopted 1/93)
• Standard
of Practice 1-6
Realtors®
shall submit offers and counter-offers objectively and as quickly as possible.
(Adopted 1/93, Amended 1/95)
• Standard
of Practice 1-7
When
acting as listing brokers, Realtors® shall continue to submit to the
seller/landlord all offers and counter-offers until closing or execution of a
lease unless the seller/landlord has waived this obligation in writing. Realtors®
shall not be obligated to continue to market the property after an offer has
been accepted by the seller/landlord. Realtors®
shall recommend that sellers/landlords obtain the advice of legal counsel
prior to acceptance of a subsequent offer except where the acceptance is
contingent on the termination of the pre-existing purchase contract or lease.
(Amended 1/93)
• Standard
of Practice 1-8
Realtors®,
acting as agents or brokers of buyers/tenants, shall submit to buyers/tenants
all offers and counter-offers until acceptance but have no obligation to
continue to show properties to their clients after an offer has been accepted
unless otherwise agreed in writing. Realtors®,
acting as agents or brokers of buyers/tenants, shall recommend that
buyers/tenants obtain the advice of legal counsel if there is a question as to
whether a pre-existing contract has been terminated. (Adopted 1/93, Amended 1/99)
• Standard
of Practice 1-9
The
obligation of Realtors®
to preserve confidential information (as defined by state law) provided by
their clients in the course of any agency relationship or non-agency
relationship recognized by law continues after termination of agency
relationships or any non-agency relationships recognized by law. Realtors®
shall not knowingly, during or following the termination of professional
relationships with their clients:
1) reveal
confidential information of clients; or
2) use
confidential information of clients to the disadvantage of
clients; or3) use confidential information of clients for the Realtor®’s
advantage or the advantage of third parties unless:
a) clients
consent after full disclosure; or
b) Realtors®
are required by court order; or
c) it
is the intention of a client to commit a crime and the information is
necessary to prevent the crime; or
d) it
is necessary to defend a Realtor®
or the Realtor®’s
employees or associates against an accusation of wrongful conduct.
Information
concerning latent material defects is not considered confidential information
under this Code of Ethics. (Adopted
1/93, Amended 1/01)
• Standard
of Practice 1-10
Realtors®
shall, consistent with the terms and conditions of their real estate licensure
and their property management agreement, competently manage the property of
clients with due regard for the rights, safety and health of tenants and
others lawfully on the premises. (Adopted
1/95, Amended 1/00)
• Standard
of Practice 1-11
Realtors®
who are employed to maintain or manage a client’s property shall exercise
due diligence and make reasonable efforts to protect it against reasonably
foreseeable contingencies and losses. (Adopted
1/95)
• Standard
of Practice 1-12
When
entering into listing contracts, Realtors®
must advise sellers/ landlords of:
1) the
Realtor®’s company
policies regarding cooperation and the amount(s) of any compensation that will
be offered to subagents, buyer/tenant agents, and/or brokers acting in legally
recognized non-agency capacities;
2) the
fact that buyer/tenant agents or brokers, even if compensated by listing
brokers, or by sellers/landlords may represent the interests of
buyers/tenants; and
3) any
potential for listing brokers to act as disclosed dual agents,
e.g., buyer/tenant agents. (Adopted
1/93, Renumbered 1/98, Amended
1/03)
• Standard
of Practice 1-13
When
entering into buyer/tenant agreements, Realtors®
must advise potential clients of:
1) the
Realtor®’s company
policies regarding cooperation;
2) the
amount of compensation to be paid by the client;
3) the
potential for additional or offsetting compensation from other brokers, from
the seller or landlord, or from other parties;
4) any
potential for the buyer/tenant representative to act as a
disclosed dual agent, e.g., listing broker, subagent, landlord’s
agent, etc., and
5) the
possibility that sellers or sellers’ representatives may not treat the
existence, terms, or conditions of offers as confidential unless
confidentiality is required by law, regulation, or by any
confidentiality agreement between the parties. (Adopted
1/93, Renumbered 1/98, Amended 1/06)
• Standard
of Practice 1-14
Fees
for preparing appraisals or other valuations shall not be contingent upon the
amount of the appraisal or valuation.
(Adopted 1/02)
• Standard
of Practice 1-15
Realtors®,
in response to inquiries from buyers or cooperating brokers shall, with the
sellers’ approval, disclose the existence of offers on the property. Where
disclosure is authorized,
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)
Article
2
Realtors®
shall avoid exaggeration, misrepresentation, or concealment of pertinent facts
relating to the property or the transaction. Realtors®
shall not, however, be obligated to discover latent defects in the property,
to advise on matters outside the scope of their real estate license, or to
disclose facts which are confidential under the scope of agency or non-agency
relationships as defined by state law. (Amended
1/00)
• Standard
of Practice 2-1
Realtors®
shall only be obligated to discover and disclose adverse factors reasonably
apparent to someone with expertise in those areas required by their real
estate licensing authority. Article 2 does not impose upon the Realtor®
the obligation of expertise in other professional or technical disciplines.
(Amended 1/96)
• Standard
of Practice 2-2
(Renumbered
as Standard of Practice 1-12 1/98)
• Standard
of Practice 2-3
(Renumbered
as Standard of Practice 1-13 1/98)
• Standard
of Practice 2-4
Realtors®
shall not be parties to the naming of a false consideration in any document,
unless it be the naming of an obviously nominal consideration.
• Standard
of Practice 2-5
Factors
defined as “non-material” by law or regulation or which are expressly
referenced in law or regulation as not being subject to disclosure are
considered not “pertinent” for purposes of Article 2. (Adopted
1/93)
Article
3
Realtors®
shall cooperate with other brokers except when cooperation is not in the
client’s best interest. The obligation to cooperate does not include the
obligation to share commissions, fees, or to otherwise compensate another
broker. (Amended 1/95)
• Standard
of Practice 3-1
Realtors®,
acting as exclusive agents or brokers of sellers/landlords, establish the
terms and conditions of offers to cooperate. Unless expressly indicated in
offers to cooperate, cooperating brokers may not assume that the offer of
cooperation includes an offer of compensation. Terms of compensation, if any,
shall be ascertained by cooperating brokers before beginning efforts to accept
the offer of cooperation. (Amended 1/99)
• Standard
of Practice 3-2
To
be effective, any change 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 3-3
Standard
of Practice 3-2 does not preclude the listing broker and cooperating broker
from entering into an agreement to change cooperative compensation. (Adopted
1/94)
• Standard
of Practice 3-4
Realtors®,
acting as listing brokers, have an affirmative obligation to disclose the
existence of dual or variable rate commission arrangements (i.e., listings
where one amount of commission is payable if the listing broker’s firm is
the procuring cause of sale/lease and a different amount of commission is
payable if the sale/lease results through the efforts of the seller/landlord
or a cooperating broker). The listing broker shall, as soon as practical,
disclose the existence of such arrangements to potential cooperating brokers
and shall, in response to inquiries from cooperating brokers, disclose the
differential that would result in a cooperative transaction or in a sale/lease
that results through the efforts of the seller/landlord. If the cooperating
broker is a buyer/tenant representative, the buyer/ tenant representative must
disclose such information to their client before the client makes an offer to
purchase or lease. (Amended 1/02)
• Standard
of Practice 3-5
It
is the obligation of subagents to promptly disclose all pertinent facts to the
principal’s agent prior to as well as after a purchase or lease agreement is
executed. (Amended 1/93)
• Standard
of Practice 3-6
Realtors®
shall disclose the existence of accepted offers, including offers with
unresolved contingencies, to any broker seeking cooperation. (Adopted 5/86, Amended 1/04)
• Standard
of Practice 3-7
When
seeking information from another Realtor®
concerning property under a management or listing agreement, Realtors®
shall disclose their Realtor®
status and whether their interest is personal or on behalf of a client and, if
on behalf of a client, their relationship with the client. (Amended 1/11)
• Standard
of Practice 3-8
Realtors®
shall not misrepresent the availability of access to show or inspect a listed
property. (Amended 11/87)
• Standard
of Practice 3-9
Realtors®
shall not provide access to
listed property on terms other than those established by the owner or the
listing broker. (Adopted 1/10)
• Standard
of Practice 3-10
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)
Article
4
Realtors®
shall not acquire an interest in or buy or present offers from themselves, any
member of their immediate families, their firms or any member thereof, or any
entities in which they have any ownership interest, any real property without
making their true position known to the owner or the owner’s agent or
broker. In selling property they own, or in which they have any interest, Realtors®
shall reveal their ownership or interest in writing to the purchaser or the
purchaser’s representative. (Amended
1/00)
• Standard
of Practice 4-1
For
the protection of all parties, the disclosures required by Article 4 shall be
in writing and provided by Realtors®
prior to the signing of any contract. (Adopted
2/86)
Article
5
Realtors®
shall not undertake to provide professional services concerning a property or
its value where they have a present or contemplated interest unless such
interest is specifically disclosed to all affected parties.
Article
6
Realtors®
shall not accept any commission, rebate, or profit on expenditures made for
their client, without the client’s knowledge and consent.
When
recommending real estate products or services (e.g., homeowner’s insurance,
warranty programs, mortgage financing, title insurance, etc.), Realtors®
shall disclose to the client or customer to whom the recommendation is made
any financial benefits or fees, other than real estate referral fees, the Realtor®
or Realtor®’s firm
may receive as a direct result of such recommendation. (Amended 1/99)
• Standard
of Practice 6-1
Realtors®
shall not recommend or suggest to a client or a customer the use of services
of another organization or business entity in which they have a direct
interest without disclosing such interest at the time of the recommendation or
suggestion. (Amended 5/88)
Article
7
In
a transaction, Realtors®
shall not accept compensation from more than one party, even if permitted by
law, without disclosure to all parties and the informed consent of the Realtor®’s
client or clients. (Amended 1/93)
Article
8
Realtors®
shall keep in a special account in an appropriate financial institution,
separated from their own funds, monies coming into their possession in trust
for other persons, such as escrows, trust funds, clients’ monies, and other
like items.
Article
9
Realtors®,
for the protection of all parties, shall assure whenever possible that all
agreements related to real estate transactions including, but not limited to,
listing and representation agreements, purchase contracts, and leases are in
writing in clear and understandable language expressing the specific terms,
conditions, obligations and commitments of the parties. A copy of each
agreement shall be furnished to each party to such agreements upon their
signing or initialing. (Amended 1/04)
• Standard
of Practice 9-1
For
the protection of all parties, Realtors®
shall use reasonable care to ensure that documents pertaining to the purchase,
sale, or lease of real estate are kept current through the use of written
extensions or amendments. (Amended 1/93)
• Standard
of Practice 9-2
When
assisting or enabling a client or customer in establishing a contractual
relationship (e.g., listing and representation agreements, purchase
agreements, leases, etc.) electronically, Realtors®
shall make reasonable efforts to explain the nature and disclose the specific
terms of the contractual relationship being established prior to it being
agreed to by a contracting party. (Adopted
1/07)
Duties
to the Public
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, 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, national origin, or sexual orientation. (Amended
1/11)
• Standard
of Practice 10-1
When
involved in the sale or lease of a residence, Realtors®
shall not volunteer information regarding the racial, religious or ethnic
composition of any neighborhood nor shall they engage in any activity which
may result in panic selling, however, Realtors® may
provide other demographic information. (Adopted
1/94, Amended 1/06)
• Standard
of Practice 10-2
When
not involved in the sale or lease of a residence, Realtors®
may provide demographic information related to a property, transaction or
professional assignment to a party if such demographic information is (a)
deemed by the Realtor®
to be needed to assist with or complete, in a manner consistent with Article
10, a real estate transaction or professional assignment and (b) is obtained
or derived from a recognized, reliable, independent, and impartial source. The
source of such information and any additions, deletions, modifications,
interpretations, or other changes shall be disclosed in reasonable detail. (Adopted 1/05, Renumbered 1/06)
• Standard
of Practice 10-3
Realtors®
shall not print, display or circulate any statement or advertisement with
respect to selling or renting of a property that indicates any preference,
limitations or discrimination based on race, color, religion, sex, handicap,
familial status, national origin, or sexual orientation. (Adopted
1/94, Renumbered 1/05 and 1/06, Amended 1/11)
• Standard
of Practice 10-4
As used in Article 10 “real estate employment practices” relates to employees and independent contractors providing real estate-related services and the administrative and clerical staff directly supporting those individuals. (Adopted 1/00, Renumbered 1/05 and 1/06)
Article
11
The
services which Realtors®
provide to their clients and customers shall conform to the standards of
practice and competence which are reasonably expected in the specific real
estate disciplines in which they engage; specifically, residential real estate
brokerage, real property management, commercial and industrial real estate
brokerage, 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)
• 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)
• Standard
of Practice 11-2
The
obligations of the Code of Ethics in respect of real estate disciplines other
than appraisal shall be interpreted and applied in accordance with the
standards of competence and practice which clients and the public reasonably
require to protect their rights and interests considering the complexity of
the transaction, the availability of expert assistance, and, where the Realtor®
is an agent or subagent, the obligations of a fiduciary. (Adopted 1/95)
• Standard
of Practice 11-3
When
Realtors® provide
consultive services to clients which involve advice or counsel for a fee (not
a commission), such advice shall be rendered in an objective manner and the
fee shall not be contingent on the substance of the advice or counsel given.
If brokerage or transaction services are to be provided in addition to
consultive services, a separate compensation may be paid with prior agreement
between the client and Realtor®.
(Adopted 1/96)
• Standard
of Practice 11-4
The
competency required by Article 11 relates to services contracted for between Realtors®
and their clients or customers; the duties expressly imposed by the Code of
Ethics; and the duties imposed by law or regulation. (Adopted 1/02)
Article
12
Realtors®
shall be honest and truthful in their real estate communications and shall
present a true picture in their advertising, marketing, and other
representations. Realtors® shall ensure that their status as real
estate professionals is readily apparent in their advertising, marketing, and
other representations, and that the recipients of all real estate
communications are, or have been, notified that those communications are from
a real estate professional. (Amended
1/08)
• Standard
of Practice 12-1
Realtors®
may use the term “free” and similar terms in their advertising and in
other representations provided that all terms governing availability of the
offered product or service are clearly disclosed at the same time. (Amended 1/97)
• Standard
of Practice 12-2
Realtors®
may represent their services as “free” or without cost
even if they expect to receive compensation from a source other than their
client provided that the potential for the Realtor®
to obtain a benefit from a third party is clearly disclosed at the same time. (Amended
1/97)
• Standard
of Practice 12-3
The
offering of premiums, prizes, merchandise discounts or other inducements to
list, sell, purchase, or lease is not, in itself, unethical even if receipt of
the benefit is contingent on listing, selling, purchasing, or leasing through
the Realtor® making
the offer. However, Realtors®
must exercise care and candor in any such advertising or other public or
private representations so that any party interested in receiving or otherwise
benefiting from the Realtor®’s
offer will have clear, thorough, advance understanding of all the terms and
conditions of the offer. The offering of any inducements to do business is
subject to the limitations and restrictions of state law and the ethical
obligations established by any applicable Standard of Practice. (Amended
1/95)
• Standard
of Practice 12-4
Realtors®
shall not offer for sale/lease or advertise property without authority. When
acting as listing brokers or as subagents, Realtors®
shall not quote a price different from that agreed upon with the
seller/landlord. (Amended 1/93)
• Standard
of Practice 12-5
Realtors®
shall not advertise nor permit any person employed by or affiliated with them
to advertise 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
1/11)
• Standard of Practice 12-6
Realtors®,
when advertising unlisted real property for sale/lease in which they have an
ownership interest, shall disclose their status as both owners/landlords and
as Realtors® or real
estate licensees. (Amended 1/93)
• Standard of Practice 12-7
Only
Realtors® who
participated in the transaction as the listing broker or cooperating broker
(selling broker) may claim to have “sold” the property. Prior to closing,
a cooperating broker may
post a “sold” sign only with the consent of the listing broker. (Amended
1/96)
• Standard
of Practice 12-8
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. (Adopted
1/07)
• Standard
of Practice 12-9
Realtor®
firm websites shall disclose the firm’s name and state(s) of licensure in a
reasonable and readily apparent manner.
Websites
of Realtors® and
non-member licensees affiliated with a Realtor®
firm shall disclose the firm’s name and that Realtor®’s
or non-member licensee’s state(s) of licensure in a reasonable and readily
apparent manner. (Adopted 1/07)
• Standard
of Practice 12-10
Realtors®’
obligation to present a true picture in their advertising and representations
to the public includes the URLs and domain names they use, and prohibits Realtors®
from:
1) engaging
in deceptive or unauthorized framing of real estate
brokerage websites;
2) manipulating
(e.g., presenting content developed by others) listing content in any way that
produces a deceptive or misleading result; or
3) deceptively
using metatags, keywords or other devices/ methods to direct, drive, or divert
Internet traffic, or to otherwise mislead consumers.
(Adopted 1/07)
• Standard
of Practice 12-11
Realtors®
intending to share or sell consumer information gathered via the Internet
shall disclose that possibility in a reasonable and readily apparent manner. (Adopted
1/07)
• Standard
of Practice 12-12
Realtors®
shall not:
1) use
URLs or domain names that present less than a true picture,
or
2) register
URLs or domain names which, if used, would present less than a true picture. (Adopted
1/08)
• Standard
of Practice 12-13
The
obligation to present a true picture in advertising, marketing, and
representations allows Realtors®
to use and display only professional designations, certifications, and other
credentials to which they are legitimately entitled. (Adopted 1/08)
Article
13
Realtors®
shall not engage in activities that constitute the unauthorized practice of
law and shall recommend that legal counsel be obtained when the interest of
any party to the transaction requires it.
Article
14
If
charged with unethical practice or asked to present evidence or to cooperate
in any other way, in any professional standards proceeding or investigation, Realtors®
shall place all pertinent facts before the proper tribunals of the Member
Board or affiliated institute, society, or council in which membership is held
and shall take no action to disrupt or obstruct such processes. (Amended 1/99)
• Standard
of Practice 14-1
Realtors®
shall not be subject to disciplinary proceedings in more than one Board of Realtors®
or affiliated institute, society, or council in which they hold membership
with respect to alleged violations of the Code of Ethics relating to the same
transaction or event. (Amended 1/95)
• Standard
of Practice 14-2
Realtors®
shall not make any unauthorized disclosure or dissemination of the
allegations, findings, or decision developed in connection with an ethics
hearing or appeal or in connection with an arbitration hearing or procedural
review. (Amended 1/92)
• Standard
of Practice 14-3
Realtors®
shall not obstruct the Board’s investigative or professional standards
proceedings by instituting or threatening to institute actions for libel,
slander, or defamation against any party to a professional standards
proceeding or their witnesses based on the filing of an arbitration request,
an ethics complaint, or testimony given before any tribunal. (Adopted
11/87, Amended 1/99)
• Standard
of Practice 14-4
Realtors®
shall not intentionally impede the Board’s investigative or disciplinary
proceedings by filing multiple ethics complaints based on the same event or
transaction. (Adopted 11/88)
Duties
to Realtors®
Realtors®
shall not knowingly or recklessly make false or misleading statements about
competitors, their businesses, or their business practices. (Amended
1/92)
• Standard
of Practice 15-1
Realtors®
shall not knowingly or recklessly file false or unfounded ethics complaints. (Adopted
1/00)
• Standard
of Practice 15-2
The
obligation to refrain from making false or misleading statements about
competitors, competitors’ businesses, and competitors’ 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)
• Standard
of Practice 15-3
The
obligation to refrain from making false or misleading statements about
competitors, competitors’ businesses, and competitors’ 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.
(Adopted 1/10)
Article
16
Realtors®
shall not engage in any practice or take any action inconsistent with
exclusive representation or exclusive brokerage relationship agreements that
other Realtors® have with clients. (Amended 1/04)
• Standard
of Practice 16-1
Article
16 is not intended to prohibit aggressive or innovative business practices
which are otherwise ethical and does not prohibit disagreements with other Realtors®
involving commission, fees, compensation or other forms of payment or
expenses. (Adopted 1/93, Amended 1/95)
• Standard
of Practice 16-2
Article
16 does not preclude Realtors® from making general announcements to
prospects describing their services and the terms of their availability even
though some recipients may have entered into agency agreements or other
exclusive relationships with another Realtor®.
A general telephone canvass, general mailing or distribution addressed to all
prospects in a given geographical area or in a given profession, business,
club, or organization, or other classification or group is deemed
“general” for purposes of this standard. (Amended
1/04)
Article
16 is intended to recognize as unethical two basic types of solicitations:
First,
telephone or personal solicitations of property owners who have been
identified by a real estate sign, multiple listing compilation, or other
information service as having exclusively listed their property with another Realtor®,
and
Second,
mail or other forms of written solicitations of prospects whose properties are
exclusively listed with another Realtor®
when such solicitations are not part of a general mailing but are directed
specifically to property owners identified through compilations of current
listings, “for sale” or “for rent” signs, or other sources of
information required by Article 3 and Multiple Listing Service rules to be
made available to other Realtors®
under offers of subagency or cooperation. (Amended
1/04)
• Standard
of Practice 16-3
Article
16 does not preclude Realtors® from contacting the client of another
broker for the purpose of offering to provide, or entering into a contract to
provide, a different type of real estate service unrelated to the type of
service currently being provided (e.g., property management as opposed to
brokerage) or from offering the same type of service for property not subject
to other brokers’ exclusive agreements. However, information received
through a Multiple Listing Service or any other offer of cooperation may not
be used to target clients of other Realtors®
to whom such offers to provide services may be made. (Amended 1/04)
• Standard
of Practice 16-4
Realtors®
shall not solicit a listing which is currently listed exclusively with another
broker. However, if the listing broker, when asked by the Realtor®, refuses to disclose the expiration date
and nature of such listing; i.e., an exclusive right to sell, an exclusive
agency, open listing, or other form of contractual agreement between the
listing broker and the client, the Realtor®
may contact the owner to secure such information and may discuss the terms
upon which the Realtor®
might take a future listing or, alternatively, may take a listing to become
effective upon expiration of any existing exclusive listing. (Amended
1/94)
• Standard
of Practice 16-5
Realtors®
shall not solicit buyer/tenant agreements from buyers/ tenants who are subject
to exclusive buyer/tenant agreements. However, if asked by a Realtor®,
the broker refuses to disclose the expiration date of the exclusive
buyer/tenant agreement, the Realtor®
may contact the buyer/tenant to secure such information and may discuss the
terms upon which the Realtor®
might enter into a future buyer/tenant agreement or, alternatively, may enter
into a buyer/tenant agreement to become effective upon the expiration of any
existing exclusive buyer/tenant agreement. (Adopted
1/94, Amended 1/98)
• Standard
of Practice 16-6
When
Realtors® are
contacted by the client of another Realtor®
regarding the creation of an exclusive relationship to provide the same type
of service, and Realtors®
have not directly or indirectly initiated such discussions, they may discuss
the terms upon which they might enter into a future agreement or,
alternatively, may enter into an agreement which becomes effective upon
expiration of any existing exclusive agreement. (Amended 1/98)
• Standard
of Practice 16-7
The
fact that a prospect has retained a Realtor®
as an exclusive representative or exclusive broker in one or more past
transactions does not preclude other Realtors®
from seeking such prospect’s future business.
(Amended 1/04)
• Standard
of Practice 16-8
The
fact that an exclusive agreement has been entered into with a Realtor®
shall not preclude or inhibit any other Realtor®
from entering into a similar agreement after the expiration of the prior
agreement. (Amended 1/98)
• Standard
of Practice 16-9
Realtors®,
prior to entering into a representation agreement, have an affirmative
obligation to make reasonable efforts to determine whether the prospect is
subject to a current, valid exclusive agreement to provide the same type of
real estate service. (Amended 1/04)
• Standard
of Practice 16-10
Realtors®,
acting as buyer or tenant representatives or brokers, shall disclose that
relationship to the seller/landlord’s representative or broker at first
contact and shall provide written confirmation of that disclosure to the
seller/landlord’s representative or broker not later than execution of a
purchase agreement or lease. (Amended
1/04)
• Standard of Practice
16-11
On
unlisted property, Realtors®
acting as buyer/tenant representatives or brokers shall disclose that
relationship to the seller/landlord at first contact for that buyer/tenant and
shall provide written confirmation of such disclosure to the seller/landlord
not later than execution of any purchase or lease agreement. (Amended
1/04)
Realtors®
shall make any request for anticipated compensation from the seller/landlord
at first contact. (Amended
1/98)
• Standard
of Practice 16-12
Realtors®,
acting as representatives or brokers of sellers/ landlords or as subagents of
listing brokers, shall disclose that relationship to buyers/tenants as soon as
practicable and shall provide written confirmation of such disclosure to
buyers/tenants not later than execution of any purchase or lease agreement. (Amended
1/04)
• Standard
of Practice 16-13
All
dealings concerning property exclusively listed, or with buyer/tenants who are
subject to an exclusive agreement shall be carried on with the client’s
representative or broker, and not with the client, except with the consent of
the client’s representative or broker or except where such dealings are
initiated by the client.
Before
providing substantive services (such as writing a purchase offer or presenting
a CMA) to prospects, Realtors® shall ask prospects whether they are a
party to any exclusive representation agreement. Realtors® shall not knowingly provide substantive
services concerning a prospective transaction to prospects who are parties to
exclusive representation agreements, except with the consent of the
prospects’ exclusive representatives or at the direction of prospects. (Adopted
1/93, Amended 1/04)
• Standard
of Practice 16-14
Realtors®
are free to enter into contractual relationships or to negotiate with
sellers/landlords, buyers/tenants or others who are not subject to an
exclusive agreement but shall not knowingly obligate them to pay more than one
commission except with their informed consent. (Amended
1/98)
• Standard
of Practice 16-15
In
cooperative transactions Realtors® shall compensate cooperating Realtors®
(principal brokers) and shall not compensate nor offer to compensate, directly
or indirectly, any of the sales licensees employed by or affiliated with other
Realtors® without the
prior express knowledge and consent of the cooperating broker.
• Standard
of Practice 16-16
Realtors®,
acting as subagents or buyer/tenant representatives or brokers, shall not use
the terms of an offer to purchase/lease to attempt to modify the listing
broker’s offer of compensation to subagents or buyer/tenant representatives
or brokers nor make the submission of an executed offer to purchase/lease
contingent on the listing broker’s agreement to modify the offer of
compensation. (Amended 1/04)
• Standard of Practice
16-17
Realtors®,
acting as subagents or as buyer/tenant representatives or brokers, shall not
attempt to extend a listing broker’s offer of cooperation and/or
compensation to other brokers without the consent of the listing broker. (Amended 1/04)
• Standard
of Practice 16-18
Realtors®
shall not use information obtained from listing brokers through offers to
cooperate made through multiple listing services or through other offers of
cooperation to refer listing brokers’ clients to other brokers or to create
buyer/tenant relationships with listing brokers’ clients, unless such use is
authorized by listing brokers. (Amended
1/02)
• Standard
of Practice 16-19
Signs
giving notice of property for sale, rent, lease, or exchange shall not be
placed on property without consent of the seller/landlord. (Amended
1/93)
• Standard
of Practice 16-20
Realtors®,
prior to or after 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)
Article
17
In
the event of contractual disputes or specific non-contractual disputes as
defined in Standard of Practice 17-4 between Realtors®
(principals) associated with different firms, arising out of their
relationship as Realtors®,
the Realtors® shall
submit the dispute to arbitration in accordance with the regulations of their
Board or Boards rather than litigate the matter.
In
the event clients of Realtors®
wish to arbitrate contractual disputes arising out of real estate
transactions, Realtors®
shall arbitrate those disputes in accordance with the regulations of their
Board, provided the clients agree to be bound by the decision.
The
obligation to participate in arbitration contemplated by this Article includes
the obligation of Realtors®
(principals) to cause their firms to arbitrate and be bound by any award. (Amended
1/01)
• Standard
of Practice 17-1
The
filing of litigation and refusal to withdraw from it by Realtors®
in an arbitrable matter constitutes a refusal to arbitrate. (Adopted 2/86)
• Standard
of Practice 17-2
Article
17 does not require Realtors® to arbitrate in those circumstances
when all parties to the dispute advise the Board
in writing that they choose not to arbitrate before the Board. (Amended
1/93)
• Standard
of Practice 17-3
Realtors®,
when acting solely as principals in a real estate transaction, are not
obligated to arbitrate disputes with other Realtors®
absent a specific written agreement to the contrary. (Adopted 1/96)
• Standard of Practice 17-4
Specific
non-contractual disputes that are subject to arbitration pursuant to Article
17 are:
1) Where
a listing broker has compensated a cooperating broker and
another cooperating broker subsequently claims to be the procuring
cause of the sale or lease. In such cases the complainant may name the first
cooperating broker as respondent and arbitration may proceed without the
listing broker being named as a respondent. When arbitration occurs between
two (or more) cooperating brokers and where the listing broker is not a party,
the amount in dispute and the amount of any potential resulting award is
limited to the amount paid to the respondent by the listing broker and any
amount credited or paid to a party to the transaction at the direction of the
respondent. Alternatively, if the complaint is brought against the listing
broker, the listing broker may name the first cooperating broker as a
third-party respondent. In either instance the decision of the hearing panel
as to procuring cause shall be conclusive with respect to all current or
subsequent claims of the parties for compensation arising out of the
underlying cooperative transaction. (Adopted
1/97, Amended 1/07)
2) Where
a buyer or tenant representative is compensated by the seller or landlord, and
not by the listing broker, and the listing broker, as a result, reduces the
commission owed by the seller or landlord and, subsequent to such actions,
another cooperating broker claims to be the procuring cause of sale or lease.
In such cases the complainant may name the first cooperating broker as
respondent and arbitration may proceed without the listing broker being named
as a respondent. When arbitration occurs between two (or more) cooperating
brokers and where the listing broker is not a party, the amount in dispute and
the amount of any potential resulting award is limited to the amount paid to
the respondent by the seller or landlord and any amount credited or paid to a
party to the transaction at the
direction of the respondent. Alternatively, if the complaint is
brought against the listing broker, the listing broker may name the
first cooperating broker as a third-party respondent. In either instance the
decision of the hearing panel as to procuring cause shall be conclusive with
respect to all current or subsequent claims of the parties for compensation
arising out of the underlying cooperative transaction. (Adopted 1/97, Amended 1/07)
3) Where
a buyer or tenant representative is compensated by the buyer or tenant and, as
a result, the listing broker reduces the commission owed by the seller or
landlord and, subsequent to such actions, another cooperating broker claims to
be the procuring cause of sale or lease. In such cases the complainant may
name the first cooperating broker as respondent and arbitration may proceed
without the listing broker being named as a respondent. Alternatively, if the
complaint is brought against the listing broker, the listing broker may name
the first cooperating broker as a third-party respondent. In either instance
the decision of the hearing panel as to procuring cause shall be conclusive
with respect to all current or subsequent claims of the parties for
compensation arising out of the underlying cooperative transaction. (Adopted
1/97)
4) Where
two or more listing brokers claim entitlement to compensation pursuant to open
listings with a seller or landlord who agrees to participate in arbitration
(or who requests arbitration) and who agrees to be bound by the decision. In
cases
where one of the listing brokers has been compensated by the seller or
landlord, the other listing broker, as complainant, may name the first listing
broker as respondent and arbitration may proceed between the brokers.
(Adopted 1/97)
5) Where
a buyer or tenant representative is compensated by the seller or landlord, and
not by the listing broker, and the listing broker, as a result, reduces the
commission owed by the seller or landlord and, subsequent to such actions,
claims to be the procuring cause of sale or lease. In such cases arbitration
shall be between the listing broker and the buyer or tenant representative and
the amount in dispute is limited to the amount of the reduction of commission
to which the listing broker agreed. (Adopted
1/05)
• Standard of Practice 17-5
The
obligation to arbitrate established in Article 17 includes disputes between Realtors®
(principals) in different states in instances where, absent an established
inter-association arbitration agreement, the Realtor®
(principal) requesting arbitration agrees to submit to the jurisdiction of,
travel to, participate in, and be bound by any resulting award rendered in
arbitration conducted by the respondent(s) Realtor®’s
association, in instances where the respondent(s) Realtor®’s association determines that an
arbitrable issue exists. (Adopted 1/07)
The
Code
of Ethics was adopted in 1913. Amended
at the Annual Convention in 1924, 1928, 1950, 1951, 1952, 1955, 1956, 1961,
1962, 1974, 1982, 1986, 1987, 1989, 1990, 1991, 1992, 1993, 1994, 1995, 1996,
1997, 1998, 1999, 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2007, 2008 2009
and 2010.
Explanatory
Notes
The
reader should be aware of the following policies which have been approved by
the Board of Directors of the National Association:
In
filing a charge of an alleged violation of the Code of Ethics by a Realtor®,
the charge must read as an alleged violation of one or more Articles of the
Code. Standards of Practice may be cited in support of the charge.
The
Standards of Practice serve to clarify the ethical obligations imposed by the
various Articles and supplement, and do not substitute for, the Case
Interpretations in Interpretations of the Code of Ethics.
Modifications
to existing Standards of Practice and additional new Standards of Practice are
approved from time to time. Readers are cautioned to ensure that the most
recent publications are utilized.
©
2011, National Association of Realtors®,
All Rights Reserved
Form No. 166-288 (12/09)