Case Study #11
Deadline: December 31, 2025
REALTOR® A decided to sell a residential investment property he owned in the city. He did not list the property with his firm, but rather advertised it for sale under the heading “For Sale By Owner,” giving only his name and home telephone number. Mr. X responded to the ad, purchased the property, and took occupancy.
Shortly after moving into the property, Mr. X filed a complaint with the Association, alleging that REALTOR® A had violated Article 12 of the Code of Ethics by not disclosing that he was a real estate broker in his advertising or in negotiations for the property.
The Grievance Committee determined that the matter should be heard and referred it to the Professional Standards Committee for hearing. After following the Association’s prescribed professional standards procedures, including proper notice to parties, a Hearing Panel was convened to hear the matter.
Mr. X testified that he had purchased the property without knowledge that REALTOR® A was a real estate broker. If he had known this, said Mr. X, he might have decided not to purchase the property or might have decided to have an independent appraisal of the property made before agreeing to purchase. In any event, he said, REALTOR® A’s special knowledge and expertise placed him at a disadvantage.
REALTOR® A testified that the obligations imposed by Article 12 relate only to listed properties, where the REALTOR® acts as agent for the seller. He told the panel that he believed he had complied with the “true picture” test of Article 12 by advertising the property as a “For Sale By Owner,” because it had not been listed with his firm and there was no agency relationship to disclose.
“Besides,” explained REALTOR® A, “there was no need to disclose my licensure status in the advertisement, because my name is well known in the community as a real estate broker.”
Question: How do you think the Hearing Panel ruled? Was there a violation of Article 12 or not?
Explain your answer: