It's the Rule

by: President & CEO Terese (Terry) Penza, CAE, RCE, e-Pro

The following is an official case interpretation: Case #12-12: Advertising in the Guise of News (Adopted April, 1994. Revised November, 1995.)

Shortly after mailing his "Homeowners Neighborhood Newsletter" to local residents, several complaints were filed against REALTOR® B claiming that he had engaged in deceptive advertising in violation of Article 12's "true picture" directive. These complaints were reviewed by the Grievance Committee which determined that a hearing should be held and that all of the related complaints would be consolidated in a single hearing. The appropriate notices were sent and the hearing was convened.

REALTOR® A, one of the complainants, introduced REALTOR® B's "Homeowners Neighborhood Newsletter" into evidence pointing out that, on the first page, REALTOR® B had prominently shown pictures of, and addresses for, ten homes in an exclusive area of town labeling each as "Recently Sold." REALTOR® A, the listing broker for several of these properties, stated that, in his opinion, the average reader would readily conclude that REALTOR® B, by advertising this way, was claiming to have listed and sold the properties and that his claims violated Article 12, as interpreted by Standard of Practice 12-7. In response, REALTOR® B indicated that Article 12 was limited in scope to ". . . advertising and representations to the public" and that his "Homeowners Neighborhood Newsletter" was not, in fact, advertising but rather a well-intentioned effort to make homeowners aware of current market values. "Sale prices in our county become a matter of public record once a deed of sale is recorded," REALTOR® B argued, "and anyone who wants to find out about recent sales can get that information from the recorder's office." "All I am doing," he continued, "is reporting news—and saving residents the time and effort of retrieving this information on their own. If someone appreciates my efforts and later buys or sells through me, so much the better, but that is not the reason for my newsletter."

After hearing from the complainants and the respondent, and after reviewing the content of the newsletter, the Hearing Panel concluded that it did, in fact, violate Article 12 since, while the information regarding the properties themselves was accurate, its cumulative effect was to convey the impression that REALTOR® B had listed and/or sold the properties when he had not. The fact that he had been the cooperating broker in one of the transactions did not give him the right to claim, directly or indirectly, that he had "sold" any of the other properties because in no instance had he been the listing broker. The Hearing Panel did not accept REALTOR® B's claim that his newsletter was exempt from scrutiny under Article 12 in that he was disseminating news and not engaging in advertising. They noted that the name, address, and phone number of REALTOR® B's firm appeared prominently in several places; that a considerable portion of the newsletter was devoted to services available from REALTOR® B's firm and the advantages of doing business with REALTOR® B; and concluded that while the newsletter might, in fact, include an element of "news" a primary purpose of it was to advertise REALTOR® B and his firm and, consequently, that it was subject to scrutiny under Article 12.

REALTOR® News

REALTOR® Emeritus
Those who have been a member of a REALTOR® association for 50 continuous years is eligible for the REALTOR® Emeritus membership classification. Last November the NAR Director's voted to lower the years to 40. The following are NSBAR members that have reached their 40th year or 50th year. They will be honored at the annual awards session Wednesday, September 14 at 1:00 at Chevy Chase:

Rose Bilger (1961)
Matthew L. Doetsch (1963)
Mary Joan Herber-Fouts (1964)
Robert B. Green (1960)
James Healy (1962)
Joyce King (1965)
Edward N. Koenig (1964)
Lowell J Martin (1964)
Lyn Martin (1962)
Helen L. Matt (1964)
Patricia N. Ortseifen (1963)
Gerald Perlow (1965)
Jane Ruschli (1964)
Alan R. Sex (1959)
Elizabeth J. Smith (1961)
Mary Tam (1963)
Elaine Waxman (1964)
Richard W. Willis (1956)
William K Nash (1955)
Neil King (1955) 50 YEAR

25 years
The following will be honored at the annual awards luncheon Wednesday, September 14, 1:00 at Chevy Chase. Make plans to honor them. They have been a REALTOR® for 25 continuous years.

Angela Anderson
Deloris Axelrod
Rose Bartlebaugh
Mimi Bass
Barry Benveniste
Claire Blumenthal
Katie Davis
Esther Diamond
Beverly Fleischman
Connie L. Fuller
Lee Grosky
Judith Harper
Florrie Hershkowitz
Barbara Jacobs
Elaine Kaplan
haron Kessel
Sheila Kula
Nancy Kunz
Merle Lewis
Dale Lubotsky
Margaret McCue
Julie McWilliams
Marie C. Passalino
Adrienne Pletka
Barbara J Redszus
Anita Scheindel
Edward Skae
Mary June Sobota
Arlene J Sunkel
Margaret Yep

Reporting a Contract
MLSNI rules are specific - once a contract is signed by both the buyer and seller there must be a notice in MLS as CTG and then mark the flag. Those who refuse to do so are committing FRAUD! If yur seller does not want you to do this then you can take the listing out of MLS BUT, if you want to keep a listing in MLS then you MUST live by the rules and not make them up as you go along. MLS is NOT an advertising vehicle - it is an agreement of compensation and the members have to right to know that they have limitation on receiving a commission. MLSNI rules however do give 72 hours to put the information into the system.

Independent Contractor Agreements
The following is a possible suggestion of wording for your independent contractor agreements. You should consult your attorney before incorporating this:
In consideration of the compensation paid by Broker to Agent, Broker and Agent agree that all right, title and interest in and to any copyrightable works developed by Agent in the course of performing Agent’s responsibilities for Broker hereunder shall be owned exclusively by Broker. Such works shall be deemed “works made for hire” within the meaning of the United States Copyright Act, or to the extent any such works may not be “works made for hire,” Agent shall and hereby does assign to Broker exclusively and in perpetuity all right, title and interest in and to such works, including copyrights, and agrees to execute any documents necessary to perfect such assignment and/or register said copyrights if requested to do so by Broker.

Contracts and Forms Committee
There will be a contracts and forms committee meeting Wednesday, May 18 2 PM at the Northbrook office. This is an open meeting where we will discuss all the contracts and forms offered by NSBAR and suggestions will be entertained for changes. Please attend if you are interested in giving input.

Working with people from around the world
The best books to read on working with people from around the world is
- Kiss, Bow, or Shake Hands: How to Do Business in Sixty Countries, by Terri Morrison, et al (Paperback - April 1995),
- Gestures: The Do's and Taboos of Body Language Around the World, by Roger E. Axtell (Paperback) Do' and
- Taboos of Using English Around the World, by Roger E Axtell

Secondary Languages?
IAR has a way to search for languages spoken by REALTORS. This site is open to the public. We have sent all the information we have but I am sure there are more of you who speak a foreign language. Soon there will be a way to input this information via the web but in the meantime, give us a call and we will add this valuable information. Go to http://www.illinoisrealtor.org/FirmSearch/FirmSearch.aspx

U.S. REALTORS® Advised to Understand Mexican Market and Investor Issues
The increasing rate at which American are buying homes in Mexico has been a recurring global industry news story over the past year. Interest isn't just from border states, as evidenced in a March 27 article in the Seattle Times, entitled "Mexican Haciendas Becoming Hot Targets for Americans." Given that this trend is wide-spread across the U.S., REALTORS® would be well-advised to understand the Mexican marketplace and issues for foreign buyers. The Joint Center for Housing Studies (JCHS) at Harvard University produced an indepth report on Mexico's housing in 2004. The full report (76 pgs.) can be downloaded from the JCHS web site. A portion of the study was reprinted in the Global Perspectives (NAR's newsletter for the CIPS Network) in the 4Q 2004 issue. Access this article online in the Global Perspective archives.

FSBO commissions
NSBAR has a revised form members can use when working with FSBO's and are seeking compensation. Go to nsbar.org/Member's Only/Member Logon/enter ID and password/member only info/contracts, agreements. The form is under listing agreements.

Regrets
A memorial service for Lynn Lackie will be held July 2, 2005, noon, at Reed Chapel of Lake Forest College, 555 N Sheridan, Lake Forest.