"Agency" in the realty business

[ragman]

I wonder how many agents take advantage of their position

could this ever happen-a person owns a lot a beach side bought say 20 years ago for 30kusd

the person dies-the lawyer for the estate of the deceased contacts the only person on the documents and it is the realtor and is told the

land is worth 35kusd and aforesaid realtor said I will take care of everything-a few weeks later the lawyer receives the cheque for 31.5k(realtor takes commission at 10%)

and the realtor ends up with a lot worth 500.000usd

would this be considered ethical behaviour and could it ever happen

  Peter, maybe 25 years ago this exact thing happened with a piece of property I wanted to buy and the owner died. It wasn't water front but it had a view of the water plus a golf course. I even made inquiries about the property because I was fairly certain that there where no close relatives. I was given excuses that it wasn't settled yet and then suddenly it was.  The realtor was a close friend of the lawyer and a politician.  It happens.

[peterbj7]

Taking up Pedro's point, I don't think there's any doubt that such action by the realtor would be distinctly unethical.  In the UK (at least) it would also be illegal both criminally and as grounds for a civil suit.  But I'm sure it happens in places like this all the time.  How many poor realtors do you know?

[Nova]

It wouldn't happen in many places as safeguards and regulations are in place.  Is there no type of real estate trading act to govern the actions of agents, lawyers and buyers/sellers?  It's like any other type of industry - there are the highly ethical and honest agents, and of course the other end of the spectrum with dirty, dishonest agents, and everything in between.

And peter - there are lots of poor realtors...at least in the US.  Just look for an unemployed mortgage broker and you'll see a dozen poor realtors standing behind him.

[bethieb]

I wonder how many agents take advantage of their position

could this ever happen-a person owns a lot a beach side bought say 20 years ago for 30kusd

the person dies-the lawyer for the estate of the deceased contacts the only person on the documents and it is the realtor and is told the

land is worth 35kusd and aforesaid realtor said I will take care of everything-a few weeks later the lawyer receives the cheque for 31.5k(realtor takes commission at 10%)

and the realtor ends up with a lot worth 500.000usd

would this be considered ethical behaviour and could it ever happen

in this instance it would appear the probate attorney dropped the ball and stupidly relied upon the realtor's stated value of the property owned by the estate.  due diligence in appraising the estate's property at fair market value would be imperative to handling the closing of the estate properly.  as for the ethics of the realtor, he/she obviously provided a fraudulent appraisal to the attorney if in fact the parcel was actually worth $500K at current market value.

[pedro]

just under I believe-the parcel next door was sold for just a little less

[Laurie]

Nova, lawyers are not governed by any real estate act.  We are governed by the Rules of Professional Responsibility and the Canons of Ethics, as well as the oath of Officer of the Court.  And....we are subject to strict penalties, including possible disbarment, if we violate them. 

[Nova]

Gotcha, Laurie.  The point that I was trying to make is that both lawyers and realtors, the 2 professions most often involved in the purchase/sale of real estate, both put their asses and licenses on the line when they conduct business fraudulently - and that's the way it should be.  If someone is involved in a real estate transaction in a country that has no regulations/repercussions, then it truly becomes a matter of caveat emptor.

[peterbj7]

Nova, lawyers are not governed by any real estate act.  We are governed by the Rules of Professional Responsibility and the Canons of Ethics, as well as the oath of Officer of the Court.  And....we are subject to strict penalties, including possible disbarment, if we violate them

I presume you're talking about the USA, or some part of it.  Those penalties don't sound exactly draconian, especially since you can continue to trade whether or not you are "disbarred".  Or am I missing something?

[Laurie]

Peter, yes, I am only licensed to practice law in California, but I am sure there are similar laws and regulations for foreign attorneys.  If an attorney is disbarred here, their ticket to practice law is taken away and it would be a crime if they continued to practice - probably subject to a steep fine and/or prison time.  Disbarment, of course, is the most serious penalty as your livelihood is gone.  We can also be subject to public reproval and suspension.  If the latter two happen, an attorney must face the State Bar Court, not an action in a regular court of law.  So, it pays big time to play it square!

[bethieb]

I would agree and say it pays big time to play it square and ethically no matter what your profession.  In the end all one has (or has not) is one's good name, which is always worth its weight in gold. 

[peterbj7]

Laurie - sorry, I misread your post to say that it was realtors who were subject to those rules, not lawyers.  Obviously lawyers are quite closely regulated - though from the results many produce I don't know why they bother.

[Laurie]

 I'd have to say the same is true in any profession - and worldwide....