Best of the Legal Hotline: From Page to Practice

Helping members better understand the sources for the various rules and policies that affect their everyday practice was the focus of a PAR Legal Hotline team webinar titled “From Page to Practice” on March 17.

I opened the webinar by reviewing the different layers of rules that can come into play on any particular topic, including laws and regulations (at the national, state and local levels), Realtor® association rules (such as the Code of Ethics and MLS rules) and broker policies that are implemented within each brokerage firm.  

I emphasized the importance of knowing which types and levels of rules impact a particular topic, both to know where to look for answers and where one might look for potential enforcement of the rules if they believe someone isn’t following them. For example, filing an ethics complaint about a particular behavior won’t be particularly effective if that behavior isn’t actually covered by the Code of Ethics. 

As one example, Associate Counsel Paige Perrucci discussed the difference between Article 12 of the Code of Ethics, which requires that the brokerage name be included in advertising and marketing materials, and the State Real Estate Commission regulations, which requires both the brokerage name and phone number, with the additional requirement that the brokerage information be at least as large as the agent information. Both sets of rules apply to Realtors® advertising their services, but an ethics hearing panel has a different scope than a commission prosecution. 

Assistant General Counsel Desiree Brougher reviewed fair housing and discrimination, where the Code of Ethics interacts with laws at the federal, state and even local levels, each of which has a different scope. The federal Fair Housing Act actually has the shortest list of protected classes and applies only to residential housing. The Pennsylvania Human Relations Act not only adds protected classes but also applies to commercial transactions. And many local municipalities in Pennsylvania have their own local ordinances that include even more protected classes. Further, exceptions that exist at some levels do not exist at others. All that creates scenarios in which a property owner, landlord, broker and agent can’t just rely on an exception they find in one law without making sure that exception isn’t overridden elsewhere.  

There can even be some hidden interactions between laws and regulations at the same level, as seen in the seller disclosure rules reviewed by Associate Counsel Kacy Clouser. The Real Estate Seller Disclosure Law defines when sellers have to fill out a disclosure form and the standards they’re held to, but with minimal guidance for licensees. The SREC regulations, however, create specific obligations for both listing and buyer agents to advise their clients on their rights and responsibilities, and even could require an agent to disclose certain material defects they’re aware of if the client doesn’t include them in the disclosure form. 

Several other topics were covered, including access to listed property, record retention, release of buyer deposits and the evolving rules related to the 2024 NAR class action settlement. Learn more about all of these topics by viewing the webinar recording and additional resource links.