Disciplinary Complaint

Boards and associations of REALTORS® are responsible for enforcing the REALTORS® Code of Ethics.  The Code of Ethics imposes duties above and in addition to those imposed by law or regulation which apply only to real estate professionals who choose to become REALTORS®.

Many difficulties between real estate professionals (whether REALTORS® or not) result from misunderstanding, miscommunication, or lack of adequate communication.  If you have a problem with a real estate professional, you may want to speak with them or with a principal broker in the firm.  Open, constructive discussion often resolves questions or differences, eliminating the need for further action.

If, after discussing matters with your real estate professional or a principal broker in that firm, you are still not satisfied, you may want to contact the local board or association of REALTORS®.  Many boards and associations have informal dispute resolving processes available to consumers (e.g. ombudsmen, mediation, etc.).

If, after taking these steps, you still feel you have a grievance, you may want to consider filing an ethics complaint.  You will want to keep in mind that…

  • Only REALTORS® and REALTOR-ASSOCIATE®s are subject to the Code of Ethics of the National Association of REALTORS®.
  • If the real estate professional (or their broker) you are dealing with is not a REALTOR®, your only recourse may be the state real estate licensing authority or the courts.
  • Boards and associations of REALTORS® determine whether the Code of Ethics has been violated, not whether the law or real estate regulations have been broken.  Those decisions can only be made by the licensing authorities or the courts.
  • Boards of REALTORS® can discipline REALTORS® for violating the Code of Ethics.  Typical forms of discipline include attendance at courses and seminars designed to increase REALTORS®’ understanding of the ethical duties or other responsibilities or real estate professionals.  REALTORS® may also be reprimanded, fined, or their membership can be suspended or terminated for serious or repeated violations.  Board and associations of REALTORS® cannot require REALTORS® to pay money to parties filing ethics complaints; cannot award “punitive damages” for violations of the Code of Ethics; and cannot suspend or revoke a real estate professional’s license.
  • The primary emphasis of discipline for ethical lapses is educational, to create a heightened awareness of and appreciation for the duties the Code imposes.  At the same time, more severe forms of discipline, including fines and suspension and termination of membership may be imposed for serious or repeated violations.

The local board or association of REALTORS® can provide you with information on the procedures for filing an ethics complaint.  Here are some general principles to keep in mind:

  • Ethics complaints must be filed with the local board or association of REALTORS® within one hundred eighty (180) days from the time a complainant knew (or reasonably should have known) that potentially unethical conduct took place.
  • The REALTOR® Code of Ethics consists of seventeen (17) Articles.   The duties imposed by many of the Articles are explained and illustrated through accompanying Standards of Practice or case interpretations.
  • Your complaint should include a narrative description of the circumstances that lead you to believe the Code of Ethics may have been violated.
  • Your complaint must cite one or more of the Articles of the Code of Ethics which may have been violated.  Hearing panels decide whether the Articles expressly cited in complaints were violated – not whether Standards of Practice or case interpretations were violated.
  • The local board or association of REALTORS®’ Grievance Committee may provide technical assistance in preparing a complaint in proper form and with proper content.
  • Your complaint will be reviewed by the local board or association’s Grievance Committee.  Their job is to review complaints to determine if the allegations made, if taken as true, might support a violation of the Article(s) cited in the complaint.
  • If the Grievance Committee dismisses your complaint, it does not mean they don’t believe you.  Rather, it means that they do not feel that your allegations would support a hearing panel’s conclusion that the Article(s) cited in your complaint had been violated.  You may want to review your complaint to see if you cited an Article appropriate to your allegations.
  • If the Grievance Committee forwards your complaint for hearing, that does not mean they have decided the Code of Ethics has been violated.  Rather, it means they feel that if what you allege in your complaint is found to have occurred by the hearing panel, that panel may have reason to find that a violation of the Code of Ethics occurred.
  • If your complaint is dismissed as not requiring a hearing, you can appeal that dismissal to the board of directors of the local board or association of REALTORS®.
  • Familiarize yourself with the hearing procedures that will be followed.  In particular you will want to know about challenging potential panel members, your right to counsel, calling witnesses, and the burdens and standards of proof that apply.
  • Complainants have the ultimate responsibility (“burden”) of proving that the Code of Ethics has been violated.  The standard of proof that must be met is “clear, strong and convincing,” defined as, “…that measure or degree of proof which will produce a firm belief or conviction as to the allegations sought to be established.”  Consistent with American jurisprudence, respondents are considered innocent unless proven to have violated the Code of Ethics.
  • Be sure that your witnesses and counsel will be available on the day of the hearing.  Continuances are a privilege – not a right.
  • Be sure you have all the documents and other evidence you need to present your case.
  • Organize your presentation in advance.  Know what you are going to say and be prepared to demonstrate what happened and how you believe the Code of Ethics was violated
  • Appreciate the panel members are unpaid volunteers giving their time as an act of public service.  Their objective is to be fair, unbiased, and impartial; to determine, based on the evidence and testimony presented to them, what actually occurred; and then to determine whether the facts as they find them support a finding that the Article(s) charged have been violated.
  • Hearing panels cannot conclude that an Article of the Code as been violated unless that Article(s) is specifically cited in the complaint.
  • Keep your presentation concise, factual, and to the point.  Your task is to demonstrate what happened (or what should have happened but didn’t), and how the facts support a violation of the Article(s) charged in the complaint.
  • Hearing panels base their decisions on the evidence and testimony presented during the hearing.  If you have information relevant to the issue(s) under consideration, be sure to bring it up during your presentation.
  • Recognize that different people can witness the same event and have differing recollections about what they saw.  The fact that a respondent or their witness recalls things differently doesn’t mean they aren’t telling the truth as they recall events.  It is up to the hearing panel, in the findings of fact that will be part of their decision, to determine what actually happened.
  • The hearing panel will pay careful attention to what you say and how you say it.  An implausible account doesn’t become more believable through repetition or, through volume.
  • You are involved in an adversarial process that is, to some degree unavoidably confrontational.  Many violations of the Code of Ethics result from misunderstanding or lack of awareness of ethical duties by otherwise well-meaning, responsible real estate professionals.   An ethics complaint has enforcement process to function properly, it is imperative for all parties, witnesses, and panel members to maintain appropriate decorum.
  • When you receive the hearing panel’s decision, review it carefully.
  • Findings of fact are the conclusions of impartial panel members based on their reasoned assessment of all the evidence and testimony presented during the hearing.  Findings of fact are not appealable.
  • If you believe the hearing process was seriously flawed to the extend you were denied a full and fair hearing, there are appellate procedures that can be involved.  The fact that a hearing panel found no violation is not appealable.
  • Refer to the procedures used by the local board or association of REALTORS® for detailed information on the bases and time limits for appealing decisions or requesting a rehearing.  Rehearings are generally granted only when newly discovered evidence comes to light (a) which could not reasonably have been discovered and produced at the original hearing and (b) which might have had a bearing on the hearing panel’s decision.  Appeals brought by ethics respondents must be based on (a) a perceived misapplication or misinterpretation of one or more Articles of the Code of Ethics, (b) a procedural deficiency or failure of due process, or (c) the nature or gravity of the discipline proposed by the hearing panel.  Appeals brought by ethics complainants are limited to discipline proposed by the hearing panel.  Appeals brought by ethics complainants are limited to procedural deficiencies or failures of due process that may have prevented a full and fair hearing.

Many ethics complaints result from misunderstanding or a failure in communication.  Before filing an ethics complaint, make reasonable efforts to communicate with your real estate professional or a principal broker in the firm.  If these efforts are not fruitful, the local board or association of REALTORS® can give you the procedures and forms necessary to file an ethics complaint.[/toggle] [toggle title=”Procedures And Forms”]

  • Print the Disciplinary Complaint Form from this web site.
  • Reference the Code of Ethics and MLS Rules and Regulations from this web site.
  • Fill in the upper portion of the complaint form with the name of the REALTOR® and Broker of Record against whom you wish to file.  Fill in the lower portion that calls for the numbers of Articles of the Code of Ethics and/or Sections of the MLS rules, that you feel have been violated.  Sign and date including your mailing address and telephone number.
  • Attach a written statement of facts with all the documentation you wish submitted to support your charges.  Please provide five copies of all material.
  • Mail form and attachments to the Newport Beach Association of REALTORS® at 401 Old Newport Blvd., Suite 100, Newport Beach, CA 92663 Attn:  Kimberly Foreman.

    Newport Beach Association of REALTORS®
401 Old Newport Blvd., Suite 100, Newport Beach, CA 92663  (949) 722-2300
Department of Real Estate  (916) 227-0864    

Arbitration Complaint

Arbitration is simply the name used to describe a particular method for resolving disputes between two or more parties.  Just as problems may be resolved through negotiation or, in extreme cases, litigation, so, too, may problems be resolved by the use of arbitration.  As a matter of fact, generally speaking, arbitration may be used to resolve any type of dispute unless restricted by the arbitration agreement itself.

In an arbitration, a neutral person who is otherwise uninvolved in the dispute (the arbitrator) listens to the parties express their points of view and then renders the decision (called an award) based upon the presentation of evidence.

The process, in some respects, is similar to what takes place in a court of law.  For instance, any party to an arbitration may be represented by an attorney.  However, unlike a court process, formal rules of evidence and procedure are not required and the dispute will not be decided by an active judge or jury.  Nevertheless, the award issued by the arbitrator is binding upon the participants and can be enforced as if it were rendered in a court.

When disputes are resolved through arbitration, use of the judicial system is avoided.  In many counties throughout the state the courts are backlogged with an overabundance of lawsuits.  Progress of a court case comes slowly, the formal rules are cumbersome, and a trial may not take place for many months or even many years.  The delays inherent in litigation create an emotional and financial hardship on almost all parties.

An arbitration, on the other hand, will almost always be resolved sooner than a court action.  The entire process from start to finish is often completed in a few months.

Furthermore, because of the advantages of speed and informality, attorney fees and costs are usually lower than in litigation.

Arbitrations are also private.  Thus, the testimony and any sensitive information will take place behind doors that are not open to the public.

Additionally, individual arbitrators can be selected with an expertise in the particular field of dispute.  This helps to ensure that the decision will be made by a knowledgeable and informed person.

Lastly, arbitration awards are final, binding and legally enforceable.

There is only a limited right to appeal an arbitration award; the parties must pay for the services of an arbitrator; and, if a party does not comply with an award the prevailing party may be required to go to court to enforce the award.

Arbitration may be used to decide virtually any type of claim, including actions for breach of contract, misrepresentation and fraud.  Certain types of claims are excluded by statute from arbitration under a real estate listing or sales agreement.  Examples include bodily injury, wrongful death, foreclosure, marital dissolution, probate or eviction proceedings.  Other limitations may appear in the clause itself.  As a remedy, the arbitrator has the authority to award money damages, both actual and punitive, as well as specific performance.

Think carefully about your decision concerning arbitration.  It is important. Read the arbitration clause before deciding whether to sign it.  If you want more information ask your REALTOR® for the extensive Arbitration Question and Answer Memorandum prepared by California Association of REALTORS® or consult your attorney.

Members have agreed to arbitrate through the Association with their application for membership.  Please contact the Association at (949) 722-2300.

Non-Members: If you have signed the arbitration clause you may file an arbitration through one of the following agencies:

J.A.M.S.: (714) 939-1300 or visit jamsadr.com
American Arbitration Association: (213) 362-1900 or visit www.adr.org