CAR panel says it’s ethical to violate Illinois law

Last Thursday an Ethics Hearing Panel of the Professional Standards Committee of the Chicago Association of Realtors (“CAR”) heard my complaint that a Realtor had violated Standard of Practice 12-4 of the Realtor Code of Ethics by advertising a property for rent without authority.

My complaint had been filed on April 13 and related to ads appearing on that date. At the hearing the Realtor testified under oath that he had been given verbal authority on April 1 to advertise the property by a representative of the property. I presented an email from the property manager dated April 13 advising me that the Realtor did not have authority to advertise the property.

The Realtor’s attorney presented a copy of a brokerage agreement dated as of April 21 but not signed by a representative of the property until May 21. The brokerage agreement authorized the Realtor to advertise the property only on his own website. Ads on the broker’s website formed the basis of my ethics complaint.

Standard of Practice 12-4 of the Realtor Code of Ethics dictates that Realtors “shall not offer for sale/lease or advertise property without authority.” The Illinois Real Estate License Act, 225 ILCS 454/20-20 (26), prohibits licensees from “advertising by any means that any property is for sale or for rent without the written consent of the owner or his or her authorized agent.”

The brokerage agreement provided by the Realtor’s attorney is incontrovertible proof that the Realtor did not have the written authority that state law requires to advertise the property until May 21, the date it was accepted by the property.

The hearing panel’s findings of fact accepted the Realtor’s claims of verbal authority and also found that I had presented no evidence that the Realtor did not have authority. The panel apparently accepted the Realtor’s attorney’s contention that the email I presented from the property manager was hearsay and did not accept my contention that the Realtor’s reports of a conversation with a representative of the property were hearsay.

The hearing panel decided that the Realtor had not violated Standard of Practice 12-4 of the Realtor Code of Ethics. The decision, in effect, says that a Realtor is acting ethically while violating state law requiring written authority to advertise.

Prior to the hearing I had not been provided the name of the person at the property who purportedly gave the Realtor verbal authority to advertise. I contacted that person immediately after the hearing and was told that no such authority had been given. The Realtor had lied under oath to the Ethics Hearing Panel.

I’ve written repeatedly about CAR’s unserious approach to its Code of Ethics. Based on the decision of its hearing panel, CAR apparently has an equally unserious approach to a Realtor’s obligations to comply with Illinois law.

COMMENTS

WORDPRESS: 10
  • Miriam Bernstein 5 years

    A Board of Realtors can’t have an unserious approach to the COE – Ethics hearings are decided upon by trained individuals who have put in time..a Realtor must comply with state law but that is a separate issue from the COE…sounds like the question is what proof do you have that a conversation with the property manager did not take place…

  • Miriam,

    I supplied an email from the property manager. And I confirmed after the hearing with the leasing rep that there was no conversation on or before 4/13 with the Realtor.

    All that’s beside the point. The Realtor supplied proof that he had violated state law and the ethics hearing panel ruled, in effect, that a state law violation is not an ethics violation. That’s an invitation to lying, and that’s what transpired here.

    • Guest 5 years

      Board ethics rules don’t perfectly overlap state law. This isn’t unique to real estate. If you study the model rules of professional conduct for attorneys, for example, you’ll find that certain actions that may be against state law are not against the rules of professional conduct, and vice versa. As a result, attorneys are often forced to choose between violating state law or violating the ethics rules for their profession. It’s a fairly common hypo on the ethics professional exam every lawyer must take before being authorized to practice law.

      With that in mind, I think your best course of action is to advocate for a change to the ethics rule to make the kind of conduct you’re describing a violation.

  • evilp 5 years

    Ummm Realtors? Ethics? The general public puts Realtors 2 steps below used car salesmen and one below congressmen.

  • Jorge 5 years

    From my understanding of CAR Ethics hearing. Isn’t it also that during a hearing that all at hearing are sworn to confidentiality and sharing information is a violation of the hearing board. You sharing that information is a violation in itself if you stood in front of the board and sworn under oath to keep the information about the hearing confidential and you are sharing that here at the moment. It’s nice to say a Realtor decided to violate law when you are violating it yourself.

    • Your understanding is wrong. All we were asked to swear to at the hearing was to tell the truth.

  • Won Ton Soup 5 years

    Is there a better business out there? With no money up and no outlay of capital, an unlicensed person (with a supply of Adderall) can post 10,000 ads on Craig’s List for apartments and when they happen to connect with a person who rents, they get a check for 125% of first month’s rent. Again and again and again.

    Hooray America.

  • Guest,

    The situation you describe is different than the one here.

    Compliance with state law would automatically comply with the Realtor Code of Ethics. When state law specifies the kind of “authority” that’s required, it’s unbelievable that a Realtor would claim compliance with the Code of Ethics by securing only verbal authority and violating the law.

  • Jorge 5 years

    I think you were wrong. I’ve been part of those hearing and they clearly state that you are not share any information that is part of an ethics hearing. Shocking that you would not listen. I would suggest go back and listen to the recording from your hearing and they clearly state that unless were not listening.

    Also, the board rules clearly state unless you are the owner of the property and clearly state that you did not want your property advertised verbal communication by a representative of the property whether the person remembered or not is clear indication that the person gave authorization whether verbal or written.

    Just by looking at your website it is clear that you have no respect for the real estate profession, you clearly compete with real estate professionals, you give advice about real estate without being a licensed realtor or taking the state exam or being part of a board,

    Being an retired attorney does not make you an expert on real estate and from my opinion about blogs. Blogs are one sided and have no crediabilty especially when someone isn’t particularly an expert in the field they are critisizing!!! and it’s shameful how you give out personal information about individuals. You would not like it if someone gave out your personal address in Wilmette to every realtor out there.

  • Jorge,

    What’s shocking is your assuming that I didn’t hear or understand what I agreed to under oath. I was not sworn to confidentiality.

    What’s even more shocking is your bald assertion of a non-existent “board” rule that would be in clear conflict with state law.

    The real estate profession has supported my company and this site for 27 years now, due in no small part because of my respect for and commitment to the profession.

    I held a broker license from 1984 to 1988 and let it lapse so there’d be no conflict of interest with my clients. You can look my license up in the state database. I was also a member of CAR during part of that time. Neither the licensing process nor my CAR membership taught me anything worth learning about real estate.