Scenario 1: The Sellers anticipate that their listing will generate multiple offers. To be fair, the Seller instructs the listing agent to tell showing agents and prospects that the Seller will review all offers at the end of the weekend, on Sunday at 6:00 pm. On Saturday, the Seller receives an all cash offer $100,000 above the list price with no additional terms or contingencies, but the time limit for acceptance of the offer is Saturday night at 6:00 pm. The Seller wants to accept it asap.
Is the Seller obligated to wait until Sunday at 6:00? Would it be a violation of Article 3 of the Realtor Code of Ethics to accept the earlier offer? Article 3 of the Code of Ethics says “Realtors shall cooperate with other brokers except when cooperation is not in the client’s best interest…”
We haven’t seen any case law on this, but the general consensus is that the Seller can accept a contract at any time, even if the Seller has previously instructed the listing agent otherwise. Article 3 of the Code of Ethics does allow the exception of when cooperation is “not in the client’s best interests.” So long as the client is calling the shots and not the Realtor®, and there are no Fair Housing issues, the client’s wishes prevail.
To cover ourselves and avoid disappointed, angry selling agents and liability for license law and Code of Ethics violations, we should, as Listing Agents, include a statement in private remarks that “The Seller reserves the right to accept offers at any time.”
You list a property as “Coming Soon” with no showings available on the property until the commencement date.
The day before the marketing commencement date, a potential buyer without a cooperating agent reaches out to you wanting to see the house ASAP, because they are headed out of town that night. You’d love to earn both sides of the transaction, so you contact the prospect and let them see the property a day before the marketing commencement date. The early prospect’s offer is accepted.
You have just violated both the NAR Realtor Code of Ethics and the rules of FMLS. It’s Article 3 again, but in Scenario 2, it is read against the Listing Agent. Realtors are obligated under the Realtor Code of Ethics to cooperate with other brokers, unless it’s not in their client’s best interest.
By showing the home yourself a day before publicly stating when it would be available to see, you’ve misrepresented the availability of access to the property and violated the obligation to share information about the property and make it available to other brokers. You’ve also limited the period of marketing of the property, possibly shutting off other, better offers. There is also a truth in advertising component. State law, NAR Code of Ethics and Georgia License Law can all come into play.