StraightTalk is a great place to start learning how living the code can help improve your business, but it’s no legal substitute for the Code of Ethics.
Thoughts on Article 17
We arbitrate. We don't sue one another.
When a conflict arises between two brokers from different firms (we’re talking contractual disputes and specific non-contractual disputes; see SoP 17- 4), the two parties are bound to settle the dispute through arbitration and not through litigation. We arbitrate, we don’t sue each other.
If clients decide to arbitrate a disagreement over a contract, as opposed to suing, everyone is bound by the decision of the arbitrator.
The obligation to arbitrate extends beyond the REALTOR® to his/her firm as well.
Standard of Practice 17-1
Suing someone is considered a refusal to arbitrate.
Standard of Practice 17-2
You don’t have to arbitrate a dispute, if everyone involved in the transaction notifies the Board in writing that they don’t want to.
Standard of Practice 17-3
When you are acting as a principal in a transaction, you aren’t obligated to arbitrate a dispute with another REALTOR®, unless you agreed in advance that that’s how you would settle things.
Standard of Practice 17-4
There are some specific non-contractual disputes that are subject to arbitration as defined in Article 17. Standard of Practice 17-4 goes into an, “ahem,” lengthy discussion of the particulars. It describes several specific scenarios where a conflict arose over who should be paid for a particular transaction. The reality is, you probably won’t ever run into one of these situations. We encourage you to go read what the formal Code has to say, and if you have questions, we encourage you to ask your broker or call the Virginia Association of REALTORS® for a little help.
Standard of Practice 17-5
If you end up in a dispute with a REALTOR® from another state, then the person filing the dispute agrees that the case will be settled by the association of the other REALTOR®. If you file a complaint, you agree to let the other person’s association settle the issue.
Next: Your client’s interests come first
Terms to Know:
Before we begin, there are several terms that appear in the Code of Ethics that could use a little clarification:
Client is anyone that you or your firm has a formal agreement to work with. It could be an agency relationship or you could be providing a non-contracted service.
Customer is a party to a real estate transaction who receives information, services or some other benefit from you, but doesn’t have a contract with you or your firm.
Prospect is a buyer, seller, tenant or landlord with whom you or your firm has no contract. An agent is anyone with a real estate license (though not necessarily a REALTOR®) acting in an agency relationship as defined by Virginia law.
Broker is someone with a real estate license (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.
REALTOR® is someone who has earned his/her real estate license and also earned the right to use the title. REALTORS® serve many roles in different real estate transactions. For our purposes, we mean the term to be all inclusive, whether the REALTOR® represents a buyer, seller, tenant or landlord. Whether they provide contracted services or provide a service without a contract.