Code of Ethics

When a real estate licensee joins a local Board or Association of REALTORS®, he or she agrees to conform his or her conduct to the NAR Code of Ethics. The Code of Ethics is comprised of a Preamble and 17 Articles, with corresponding Standards of Practice that support and interpret each Article. Case Interpretations provided by NAR demonstrate the application of the Articles to particular fact situations.

Although the Code of Ethics contains 17 Articles and numerous Standards of Practice and Case Interpretations, this essay will discuss only Article 15 and an applicable Case Interpretation.

The exclusion of some does not mean they are not important - only that space does not permit a discussion of all.

We urge you to review the Code in its entirety.
(Please note that the Code of Ethics is subject to copyright 2004 by the National Association of REALTORS® and may not be reproduced without their permission.)

You will find a copy of the Code of Ethics on both C.A.R.'s and NAR's websites.

California Association of REALTORS® - Code of Ethics

In addition, look for ethics essays that discuss other Articles.

Article 15 - False Statements About Competitors

Article 15 prohibits REALTORS® from knowingly making false or misleading statements about their competitors as follows:

"REALTORS® shall not knowingly or recklessly make false or misleading statements about competitors, their businesses or their business practices. (Amended 1/92)"HYPOTHETICAL: REALTOR® Armando was a broker in a highly competitive market area. One day he spotted an ad from one of his competitors, REALTOR® Susie. The ad showed a graph comparing the percentage of total listings in the MLS listed by REALTOR® Susie with the listings of other brokers in the area. REALTOR® Armando thought that the percentage of listings for him, 10%, was low. After checking his records and confirming that his percentage was actually 11 %, he filed a complaint charging REALTOR® Susie with violation of Article 15.

QUESTION: Is REALTOR® Susie in violation of Article 15? 2150-57274

IS THAT YOUR FINAL ANSWER? No. In Case #15-1, the Hearing Panel found that REALTOR® Susie's ad, while slightly inaccurate, was based on usually accurate information from the MLS and was made in good faith - not "knowing" or "reckless," Therefore, REALTOR® Susie was not in violation of the Code.

BOTTOM LINE: If you're going to make representations about your competitors, be sure you're reasonably accurate and have a good faith belief in its truth.

Corporate Legal Services, Tel 213739.8215, Fax 2134807724 , July 16.2004 Copyright© 2004 CALIFORNIA ASSOCIATION OF REALTORS® (CAR). Permission is granted to CAR. members only to reprint and use this material for non-commercial purposes provided credit is given to the C.A.R Legal Department. Other reproduction or use is strictly prohibited without the express written permission of the CAR Legal Department. All rights reserved.