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By: Hank Lerner, Esq. on in

Ethics in the Time of COVID-19

Just to be clear, this is NOT a rehash of things you can’t do based on the governor’s closure and stay at home orders. You can read all about that and keep up to date with our constantly updated FAQs on the PAR website.

Instead, this is a reminder that – regardless of the complete craziness swirling around us in these complicated times – you can’t forget the basics. Adherence to the Realtor® Code of Ethics is one of the things that sets you apart from mere licensees, and living by the Code is more important than ever in these uncertain times.

As you’re figuring out how to adapt your business to the current conditions, think through some of the Articles of the Code and how they might apply:

Article 1: Realtors® “protect and promote the interests of their client” and are “obligated to treat all parties honestly.”

  • Have you discussed with clients whether it’s truly in their best interests to move ahead with a transaction in the current market?
  • Have you counseled your clients on the hurdles they’re likely to face, and are you able to help them (legally and ethically) navigate them?
  • Are you treating the parties honestly if you promote or offer services which are prohibited by the governor’s orders?

Article 3, Standard of Practice 3-8: (“Realtors® shall not misrepresent the availability of access to show or inspect a listed property”)

Article 3, Standard of Practice 3-9: (“Realtors® shall not provide access to listed property on terms other than those established by the owner of the listing broker.”)

  • Are you offering property access in a way that is prohibited by the governor’s orders?
  • Are you attempting to schedule showings when the seller has said they don’t want them?
  • If it is possible to access a property legally, are you able to adequately ensure that all showing instructions are complied with?

Article 10: “Realtors® shall not deny equal professional services to any person” based on their inclusion in one of the protected classes.

  • Are you refusing to work with potential clients based on their ethnicity (e.g., unwilling to work with Chinese or Italian clients)?
  • Are you only cutting back or refusing business in areas that could have a disproportionate impact on certain protected classes?

Article 11: Services provided by Realtors® “shall conform to the standards of practice and competence which are reasonably expected in the specific real estate disciplines in which they engage….”

  • Standards for the safe practice of real estate are changing – at least in the current environment, and perhaps permanently. Are you aware of the changes and able to provide those services?
  • The new hurdles faced in different types of real estate practice will be very different. Are you sufficiently well-versed in those specific issues to be able to practice outside of your primary expertise, or is now a good time to refer to experts in those other specialties?

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.”

  • Is it “honest and truthful” to advertise that you are able to provide certain services when those services are prohibited by the governor’s orders, or may be unsafe/unwise in the current environments?
  • Are you making claims about your business practices that may not be supported by facts (e.g., if something says “our closing process follows all CDC guidelines”), does it?

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.”

  • OK…I’m going to break my rule here and say that if you’re an agent or broker trying to write your own liability waivers, hold harmless agreements, force majeure provisions, or anything else along those lines JUST STOP IT RIGHT NOW! Ethics or not, if you get sued for something you drafted on the back of a napkin without counsel’s advice the outcome will not be good for anyone but the plaintiff.

Article 15: “Realtors® shall not knowingly or recklessly make false or misleading statements about other real estate professionals, their businesses, or their business practices.”

  • Are you making statements about other Realtors® or service providers that are not accurate? For example, stating that another provider is “not open for business” could be misleading if the reason they’re not open is that they’re complying with the governor’s orders.
  • If you post a nasty comment about how other practitioners have chosen to do business it could be a violation if your reaction is deemed to be false or misleading.

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.”

  • Are you suggesting that you can provide services in place of a consumer’s existing broker/agent?
  • If you are working with consumers but not signing formal representation agreements, have you considered that other Realtors® are not violating the Code if they approach those consumers.

To be clear, nothing in this article is pointing to any specific ad/post/activity– but the questions being posed are based on comments and concerns that we have heard from across the state. If any of these look like things you’re doing, you may want to rethink your approach. If you’re seeing these sorts of things from other Realtors® you can consider pursuing an ethics complaint through the usual channels at your local association or PAR if your association participates in the statewide cooperative.

19 Responses
  • March 30, 2020 at 7:36 am Joe D’Alonzo says

    Why not just make it very easy for everyone and take the MLS off-line so there is no decision to be made by any licensee.

    Reply
    • March 30, 2020 at 7:39 am Kevin Juliano says

      Joe – There are over 20 MLS systems in Pennsylvania and they are not maintained or overseen by PAR.

      Reply
  • March 30, 2020 at 7:42 am Thomas Saveri says

    Thank you for this Hank.

    Reply
  • March 30, 2020 at 7:50 am Bill Henry says

    Taking the MLS offline sounds like an easy solution, but in the case of our MLS we would be removing all virtual showings of properties too and a big part of the advertising for our clients. Besides I am not sure but that may also be a violation of the antitrust laws. Our system allows the brokers to blackout showings, if clients are concerned something may slip through the cracks then each individual broker could use that as a way to stop showings.

    Reply
  • March 30, 2020 at 8:09 am Ryan Thomas says

    Good article. Now is not a time to try and find a loop hole. We are an industry of problem solvers. But this is not an obstacle we should be trying to overcome. It is what it is. Do the best we can from home to line up business when all this is over. This is the second thread with a comment about taking the mls off. I use it for research. I will have a lot less to do from home if that’s taken off. I have CMA’s to do, plus creating mailing lists and more. Horrible idea. Disabling showing time however makes perfect sense.

    Reply
  • March 30, 2020 at 8:24 am Jim Jarrett says

    Thanks Hank!

    Reply
  • March 30, 2020 at 8:38 am Sherrie Miller says

    Well written. Thank you!

    Reply
  • March 30, 2020 at 8:48 am Vernon Jones, Regional VP, Bright MLS says

    For those who subscribe to Bright MLS, brokers have the ability via ‘permissions’ to disable open house functionality for their salespersons if they so choose. If a broker needs assistance in accomplishing this, please contact Bright’s Customer Support Center at 1-844-552-7444

    Reply
  • March 30, 2020 at 10:04 am Cole Golden says

    Great information to consider and adhere to during this time. Will this be communicated to all of the membership? I would guess that members who took the time to read it are already adhering to the Code.

    Reply
  • March 30, 2020 at 10:08 am Andrew Wetzel says

    Thanks Hank!

    Reply
  • March 30, 2020 at 10:50 am Dominic Cardone says

    Thank you. Follow the Code! These are very good thoughts Hank. Sometimes you are more REALTOR than Lawyer 🙂

    Reply
  • March 30, 2020 at 11:05 am Rob Pileggi says

    Why not consider rolling back some of the newly enacted coming soon restrictions for 6 months so Realtors can get visibility for their properties on social media, etc.? Not every listing can fit into the 21 day window.

    Reply
  • March 30, 2020 at 11:39 am Michelle Strange says

    ARTICLE 11: Is it possible for someone to expand on this one for me? I was a little confused as to what it was specifically referring to. Perhaps with so much change, my brain is fried and I just need easier clarification… Is it talking about becoming more “virtual” with our practice?

    Reply
    • March 30, 2020 at 4:02 pm Hank Lerner, Esq. says

      You’re on the right track, Michelle. Article 11 says that you need to meet a certain level of basic competency to practice in X area of real estate. Realtors often think of this in terms of crossing specialties (e.g., a residential agent doing a commercial transaction), but it also means that you need to meet that basic competency in your primary specialty. As things change, that level of competency changes too. As you noted, if real estate moves to an environment with significantly limited in-person activity it may be that things like virtual tours and electronic signatures go from cool marketing add-ons to practice necessities. At an even more basic level, competency means understanding relevant laws/rules/etc. and applying that in practice. A Realtor who is unaware of the legal requirements surrounding a transaction is probably not meeting that competency requirement either.

      Reply
  • March 30, 2020 at 12:18 pm Connie Brady says

    Thank you Hank! Why not just make it very easy for everyone and make all listings temporarily of the market. Keep the MLS on line so we can watch what the market is doing, complete research and marketing. It’s terrible that licensees are NOT following the governors orders and this is a direct violation of the Code of Ethics. Each broker should be made to do this and it’s horrible it’s taking this long. Shut it down, now!!!!! This also will melt zillow because they would have no listings to show!!!!!!

    Reply
  • March 30, 2020 at 12:50 pm Patrick Reilly says

    nicely done Hank!

    Reply
  • March 31, 2020 at 12:34 am Rick Gisondi says

    good food for thought

    Reply
  • March 31, 2020 at 6:26 pm James Reardon says

    You can still schedule showings..that each agent should shut off

    Reply
  • April 4, 2020 at 12:50 pm Bruce Lyster says

    Thanks for this well thought-out and presented summary Hank. Keep up the good work!

    Reply

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