Based on hotlines, leaving a brokerage often creates upset and legal disputes about money and leads and clients/pendings. Ditto with ethics and license law issues.
Associated licensees and their brokerage may want to put into written agreements what happens and what can be communicated before leaving the brokerage, during leaving the brokerage, and after leaving the brokerage regarding these dispute issues.
Written agreements can mean the pending/client stays or can leave freely or can leave for money paid upfront or in a referral agreement.
Written agreements can spell out compensation and compensation changes during a departure from a brokerage. Remember that your former brokerage may have to assign your deals/clients/pendings/listings/buyers to another brokerage licensee to get these deals closed and therefore will need to compensate them if the written agreement does not cover the deals/clients/pendings/listings/buyers leaving. An in-process deal moving can expose everyone to potential risks of loss of the deal and money. Call the hotline ASAP.
• 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 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)
Posted by: Byron King on 12/04/23 (This information is only accurate as of 12/04/23. You must contact SCR for updates and changes to this information after 12/04/23 as laws and regulations may change over time. SCR 803-772-5206 or email info at screaltors.org or email byron at screaltors.org)
This information is not legal advice. This information is intended only to provide general information and may not be relied upon as specific legal guidance. Legal counsel should always be consulted before acting in reliance on this information.