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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)
Standard of Practice 16-1
Article 16 is not intended to prohibit aggressive or innovative business practices which are otherwise ethical and does not prohibit disagreements with other REALTORS® involving commission, fees, compensation or other forms of payment or expenses. (Adopted 1/93, Amended 1/95)
Standard of Practice 16-2
Article 16 does not preclude REALTORS® from making general announcements to prospects describing their services and the terms of their availability even though some recipients may have entered into agency agreements or other exclusive relationships with another REALTOR®. A general telephone canvass, general mailing or distribution addressed to all prospects in a given geographical area or in a given profession, business, club, or organization, or other classification or group is deemed “general” for purposes of this standard. (Amended 1/04)
Article 16 is intended to recognize as unethical two basic types of solicitations:
First, telephone or personal solicitations of property owners who have been identified by a real estate sign, multiple listing compilation, or other information service as having exclusively listed their property with another REALTOR® and
Second, mail or other forms of written solicitations of prospects whose properties are exclusively listed with another REALTOR® when such solicitations are not part of a general mailing but are directed specifically to property owners identified through compilations of current listings, “for sale” or “for rent” signs, or other sources of information required by Article 3 and Multiple Listing Service rules to be made available to other REALTORS® under offers of subagency or cooperation. (Amended 1/04)
Standard of Practice 16-3
Article 16 does not preclude REALTORS® from contacting the client of another broker for the purpose of offering to provide, or entering into a contract to provide, a different type of real estate service unrelated to the type of service currently being provided (e.g., property management as opposed to brokerage) or from offering the same type of service for property not subject to other brokers’ exclusive agreements. However, information received through a Multiple Listing Service or any other offer of cooperation may not be used to target clients of other REALTORS® to whom such offers to provide services may be made. (Amended 1/04)
Standard of Practice 16-4
REALTORS® shall not solicit a listing which is currently listed exclusively with another broker. However, if the listing broker, when asked by the REALTOR®, refuses to disclose the expiration date and nature of such listing, i.e., an exclusive right to sell, an exclusive agency, open listing, or other form of contractual agreement between the listing broker and the client, the REALTOR® may contact the owner to secure such information and may discuss the terms upon which the REALTOR® might take a future listing or, alternatively, may take a listing to become effective upon expiration of any existing exclusive listing. (Amended 1/94)
Standard of Practice 16-5
REALTORS® shall not solicit buyer/tenant agreements from buyers/ tenants who are subject to exclusive buyer/tenant agreements. However, if asked by a REALTOR®, the broker refuses to disclose the expiration date of the exclusive buyer/tenant agreement, the REALTOR® may contact the buyer/tenant to secure such information and may discuss the terms upon which the REALTOR® might enter into a future buyer/tenant agreement or, alternatively, may enter into a buyer/tenant agreement to become effective upon the expiration of any existing exclusive buyer/tenant agreement. (Adopted 1/94, Amended 1/98)
Standard of Practice 16-6
When REALTORS® are contacted by the client of another REALTOR® regarding the creation of an exclusive relationship to provide the same type of service, and REALTORS® have not directly or indirectly initiated such discussions, they may discuss the terms upon which they might enter into a future agreement or, alternatively, may enter into an agreement which becomes effective upon expiration of any existing exclusive agreement. (Amended 1/98)
Standard of Practice 16-7
The fact that a prospect has retained a REALTOR® as an exclusive representative or exclusive broker in one or more past transactions does not preclude other REALTORS® from seeking such prospect’s future business. (Amended 1/04)
Standard of Practice 16-8
The fact that an exclusive agreement has been entered into with a REALTOR® shall not preclude or inhibit any other REALTOR® from entering into a similar agreement after the expiration of the prior agreement. (Amended 1/98)
Standard of Practice 16-9
REALTORS®, prior to entering into a representation agreement, have an affirmative obligation to make reasonable efforts to determine whether the prospect is subject to a current, valid exclusive agreement to provide the same type of real estate service. (Amended 1/04)
Standard of Practice 16-10
REALTORS®, acting as buyer or tenant representatives or brokers, shall disclose that relationship to the seller/landlord’s representative or broker at first contact and shall provide written confirmation of that disclosure to the seller/landlord’s representative or broker not later than execution of a purchase agreement or lease. (Amended 1/04)
Standard of Practice 16-11
On unlisted property, REALTORS® acting as buyer/tenant representatives or brokers shall disclose that relationship to the seller/landlord at first contact for that buyer/tenant and shall provide written confirmation of such disclosure to the seller/landlord not later than execution of any purchase or lease agreement. (Amended 1/04)
REALTORS® shall make any request for anticipated compensation from the seller/landlord at first contact. (Amended 1/98)
Standard of Practice 16-12
REALTORS®, acting as representatives or brokers of sellers/landlords or as subagents of listing brokers, shall disclose that relationship to buyers/tenants as soon as practicable and shall provide written confirmation of such disclosure to buyers/tenants not later than execution of any purchase or lease agreement. (Amended 1/04)
Standard of Practice 16-13
All dealings concerning property exclusively listed, or with buyer/tenants who are subject to an exclusive agreement shall be carried on with the client’s representative or broker, and not with the client, except with the consent of the client’s representative or broker or except where such dealings are initiated by the client.
Before providing substantive services (such as writing a purchase offer or presenting a CMA) to prospects, REALTORS® shall ask prospects whether they are a party to any exclusive representation agreement. REALTORS® shall not knowingly provide substantive services concerning a prospective transaction to prospects who are parties to exclusive representation agreements, except with the consent of the prospects’ exclusive representatives or at the direction of prospects. (Adopted 1/93, Amended 1/04)
Standard of Practice 16-14
REALTORS® are free to enter into contractual relationships or to negotiate with sellers/landlords, buyers/tenants or others who are not subject to an exclusive agreement but shall not knowingly obligate them to pay more than one commission except with their informed consent. (Amended 1/98)
Standard of Practice 16-15
In cooperative transactions REALTORS® shall compensate cooperating REALTORS® (principal brokers) and shall not compensate nor offer to compensate, directly or indirectly, any of the sales licensees employed by or affiliated with other REALTORS® without the prior express knowledge and consent of the cooperating broker.
Standard of Practice 16-16
REALTORS®, acting as subagents or buyer/tenant representatives or brokers, shall not use the terms of an offer to purchase/lease to attempt to modify the listing broker’s offer of compensation to subagents or buyer/tenant representatives or brokers nor make the submission of an executed offer to purchase/lease contingent on the listing broker’s agreement to modify the offer of compensation. (Amended 1/04)
Standard of Practice 16-17
REALTORS®, acting as subagents or as buyer/tenant representatives or brokers, shall not attempt to extend a listing broker’s offer of cooperation and/or compensation to other brokers without the consent of the listing broker. (Amended 1/04)
Standard of Practice 16-18
REALTORS® shall not use information obtained from listing brokers through offers to cooperate made through multiple listing services or through other offers of cooperation to refer listing brokers’ clients to other brokers or to create buyer/tenant relationships with listing brokers’ clients, unless such use is authorized by listing brokers. (Amended 1/02)
Standard of Practice 16-19
Signs giving notice of property for sale, rent, lease, or exchange shall not be placed on property without consent of the seller/landlord. (Amended 1/93)
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)
Misconduct and Redress
SECTION 40-57-710.Grounds for denial of issuance of license or for disciplinary action against licensee.
(A) In addition to Section 40-1-110, the commission may deny issuance of a license to an applicant or may take disciplinary action against a licensee who:
(1) makes a substantial misrepresentation on an application for a real estate license;
(2) makes a substantial misrepresentation involving a real estate transaction;
(3) makes false promises likely to influence, persuade, or induce;
(4) pursues a continued and flagrant course of misrepresentation or makes false and misleading promises through any medium of advertising or otherwise;
(5) in the practice of real estate, demonstrates bad faith, dishonesty, untrustworthiness, or incompetency in a manner as to endanger the interest of the public;
(6) represents a real estate broker other than the broker-in-charge or property manager-in-charge with whom they are licensed;
(7) guarantees or authorizes and permits a supervised licensee to guarantee future profits from the resale of real estate;
(8) makes a dual set of contracts, written or otherwise, by stating a sales price other than the actual sales price;
(9) is convicted of violating the federal and state fair housing laws, forgery, embezzlement, breach of trust, larceny, obtaining money or property under false pretense, extortion, fraud, conspiracy to defraud, or any other crime involving the theft or taking of the property belonging to another, or has been convicted of a felony sex-related, felony drug-related, felony real estate-related, felony financial, or felony violent offense, or pleading guilty or nolo contendere to such an offense in a court of competent jurisdiction of this State, another state, or a federal court;
(10) fails to report to the commission in writing by certified mail, within ten days, notice of conviction of a crime provided in item (9);
(11) fails, within a reasonable time, to account for or to remit trust funds coming into his possession which belong to others;
(12) pays a commission or compensation to an unlicensed individual for activities requiring a license under this chapter. Notwithstanding this section, a licensee may not pay or offer to pay a referral fee or finder’s fee to an unlicensed individual who is not a party in the real estate sales or rental transaction;
(13) violates a provision of law relating to the freedom of a buyer or seller to choose an attorney, insurance agent, title insurance agent, or another service provider to facilitate the real estate transaction;
(14) fails to disclose in accordance with Section 40-57-370 the party or parties for whom the licensee will be acting as an agent in a real estate transaction, if any;
(15) receives compensation in a real estate transaction or directly resulting from a real estate transaction from more than one party except with the full knowledge and written disclosure to all parties;
(16) represents more than one party in a real estate transaction without the full written knowledge and consent of all parties;
(17) acts as an undisclosed principal in a real estate transaction;
(18) accepts deposit money which is to be delivered to the licensee’s principal in a real estate transaction without informing the payor and having the payor acknowledge in writing who will hold the money received by the licensee;
(19) issues a check in connection with his real estate business which is returned for insufficient funds or closed account;
(20) fails to disclose in accordance with Section 40-57-350 a known material fact concerning a real estate transaction;
(21) violates a provision of this chapter or a regulation promulgated under this chapter;
(22) violates a rule or order of the commission;
(23) knowingly gives false information to an investigator or inspector;
(24) engages in a practice or takes action inconsistent with the agency relationship that other real estate licensees have established with their clients;
(25) fails to make all records required to be maintained under this chapter available to the commission for inspection and copying by the commission upon request of an investigator or inspector of the commission, fails to appear for an interview with an investigator or inspector of the commission without due cause, or provides false information upon direct inquiry by the investigator or inspector;
(26) fails to promptly submit all offers and counteroffers in a real estate sales transaction;
(27) fails to provide current contact information to the commission;
(28) allows or creates an unreasonable delay in the closing of a transaction or act in a manner which causes failure or termination of a transaction due solely to a dispute among participating licensees concerning the division of a commission; or
(29) fails to disclose civil judgments brought on grounds of fraud, misrepresentation, or deceit.
(B) If after an investigation, charges of a violation are brought against a licensee, the broker-in-charge or property manager-in-charge must be notified of the charges. In the event a supervised licensee is noticed for a formal complaint hearing or otherwise appears before the commission to resolve the charges, the broker-in-charge or property manager-in-charge of record during the events in question must also attend the hearing. Unless the broker-in-charge or property manager-in-charge can show good cause as to why he failed to appear, the absence may result in the broker-in-charge or property manager-in-charge facing disciplinary action at the discretion of the commission.
HISTORY: 1997 Act No. 24, Section 1; 2004 Act No. 218, Sections 20, 21; 2006 Act No. 352, Section 1; 2014 Act No. 258 (S.75), Section 3, eff June 9, 2014; formerly 1976 Code Section 40-57-145; 2016 Act No. 170 (S.1013), Section 1, eff January 1, 2017; 2017 Act No. 60 (H.3041), Section 3, eff July 1, 2020; 2024 Act No. 204 (H.4754), Section 3, eff May 21, 2024.
Editor’s Note
Prior Laws:1956 (49) 2046; 1969 (56) 762; 1972 (57) 2649; 1962 Code Section 56-1545.16; 1983 Act No. 94 Section 2; 1986 Act No. 353, Section 11; 1991 Act No. 12, Section 10; 1993 Act No. 181, Section 931; 1994 Act No. 385, Section 13; 1994 Act No. 451, Sections 2, 3; 1976 Code Section 40-57-170.
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This information is only accurate as of 3/13/25. You must contact SCR for updates and changes to this information after 3/13/25 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.