Dear Shannon: A broker discovered that one of their agents was bad-mouthing another local broker and appraiser online, with comments that fell under “unprofessional” and “judgmental.” Is this a big deal under the Code of Ethics?
ORLANDO, Fla. – Dear Shannon: I’m a broker, run a medium-sized, well-known brokerage in town and I’m mortified at the behavior of one of my agents. I just learned that they’ve been posting negative comments on social media about a well-known commercial broker and local appraiser.
The posts I saw were unprofessional, included pretty judgmental statements and several encouraged readers not to use their services. I don’t know if my agent’s comments are true or not, but at the very least they seem misleading.
I confronted this agent. They said I was overreacting, and that it’s their duty to warn people about the unfair business practices of others in our industry. They said they were just giving honest feedback, and that the comments were about a commercial broker who doesn’t use the MLS and an appraiser who doesn’t have a real estate license. They said, “It’s not a big deal.”
Well, it’s a big deal to me. I told my agent I thought it was unprofessional, that it was bad for the brokerage’s reputation, and that if they didn’t stop I would have to take disciplinary action.
Am I overacting here? Is this a big deal? – Mortified
Dear Mortified: Yikes! I don’t think you are overreacting and yes, this is potentially a big deal.
For the purpose of this article, I’ll only discuss a potential Code of Ethics violation, but there may be other reasons why Realtors should think twice before posting unprofessional, negative comments about other real estate professionals and their business practices. Those “other reasons” include potential civil liability and antitrust implications (which we won’t get into in this article).
Let’s look at what the Code of Ethics says about this situation.
Article 15 states “Realtors® shall not knowingly or recklessly make false or misleading statements about other real estate professionals, their businesses, or their business practices.” (Amended 1/12) (The bold is mine.)
All elements must be met for there to be a violation. Let’s unpack Article 15, element by element.
Knowingly or recklessly: This element focuses on the head space of your agent. When you confronted your agent about the social media posts, your agent didn’t deny it. Instead they responded that they felt they had a duty to post such statements. But since your agent knew they posted these statements, is this element is met? Not quite.
It’s not about whether your agent knew they posted the statements (and of course they knew they made those statements). It’s about whether or not your agent knew the statements were false or misleading, or whether it was reckless to make false or misleading statements. It’s hard for me to determine if this element is met just based on information you provided. It would be something a professional standards hearing panel would analyze in order for it to determine whether your agent knowingly or recklessly made false or misleading statements.
False or misleading statements: This element focuses on the statements themselves. I haven’t reviewed the statements themselves, but IF you are correct and the statements are misleading at the very least, then this element would be met.
About other real estate professionals: This element focuses on the definition of real estate professional. Your agent posted comments about a commercial broker and real estate appraiser, and they seem to imply that they’re not “real estate professionals” because the commercial broker doesn’t use the MLS and the appraiser doesn’t have a real estate license.
So, are the commercial broker and real estate appraiser “real estate professionals” under Article 15? Review the shaded portions of the 2023 Code of Ethics and Arbitration Manual (Manual), which highlights all the changes, and notice a new definition of the phrase “Real Estate Professional” for purposes of Article 15. Section 1, Definitions Relating to Ethics, (w) states: “Real estate professionals”, for purposes of Article 15, are those engaged in the disciplines of real estate specified in Article 11. (Adopted 5/22)
Great, now we look for the disciplines of real estate specified in Article 11. It states:
“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) (Again, the bold is mine.)
So we ask again: Are the commercial broker and real estate appraiser “real estate professionals” under Article 15? Well, the definition of real estate professionals under Article 15 points to Article 11. Article 11’s list of real estate disciplines includes commercial brokerage and real estate appraisal.
So, the answer is yes. Your agent’s “It’s not a big deal” argument doesn’t hold water based on the rationale that the commercial broker doesn’t use the MLS and the appraiser doesn’t have a real estate license.
Article 15 states, “Realtors® shall not knowingly or recklessly make false or misleading statements about other real estate professionals, their businesses, or their business practices.”
Your agent posted statements (which according to your assessment were misleading), about other real estate professionals. If you are correct about the statements being misleading, then two of the three elements seem to have been met here. It’s still up in the air whether or not your agent knowingly or recklessly made such statements.
In conclusion, one of the reasons this a big deal is because it is a potential violation of the Code of Ethics and potentially subjects your agent to discipline under the Manual.
Thank you for reaching out on this one. I don’t like hearing about Realtors making harsh, unprofessional comments about other real estate professionals. As the Preamble to the Code of Ethics says, “Realtors should refrain from making unsolicited comments about other practitioners; and where they are asked for their opinion or think that comment is necessary, their opinion should be offered in an objective, professional manner, uninfluenced by any person motivation or potential advantage or gain.”
Realtors should remember the Golden Rule that binds the Realtor family together and treat others as they would like to be treated.
Shannon Allen is an attorney and Florida Realtors Director of Local Association Services
Note: Advice deemed accurate on date of publication
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