When I wrote "Time To Change The Rules On Showing Low Co-op Fee Homes" for Realty Times, I had no idea I'd receive so many e-mails from agents thanking me for openly addressing a subject that has been on so many people's minds these days, while at the same time not being adequately addressed by our industry.

One of the e-mails came from Hank Sorensen, a Florida attorney specializing in representing brokers, agents, and their clients through his company, Brokers Legal Group. And Hank had some very interesting developments that he told me about regarding real estate agency relationships and the current laws of the land...

In Florida, for example, Hank tells me that "Under Florida law, every agent is now assumed to be operating in a transactional agency status, which expressly disclaims any fiduciary responsibility to the client (versus single agency, which does attach a fiduciary status), and I see no reason for an agent to ever show a low co-op fee listing in Florida if they don’t want to."

In following up with Hank, he further told me that "transactional agency is akin to dual agency, except that in the latter, the brokerage/agent represents both parties, and in a transactional status, they represent the "transaction," and not any party specifically. In Florida, an agent is presumed to be operating in a transactional status unless proper documents are signed making the brokerage/agent a single agent, in which a fiduciary duty attaches. In a transactional status, any fiduciary duties are expressly disclaimed."

In addition, Hank sent me information about a court case in Iowa, Next Generation Realty, Inc. et al v. Iowa Realty, Inc. et al. The court decision in this case was rendered on February 18, 2003.

In this case the court declared that the "unilateral offering of compensation by listing firms to other participants hardly constitutes price-fixing, as the exchange of this information is obviously necessary so that the potential selling realtor can decide whether it is economically worth its effort to attempt sale of the property."

In his cover letter to me along with the information he sent me about this case, Hank further stated, "Obviously no business should be required to represent clients at a loss, and having brokerages continue to work for ever-decreasing commission schedules will cause, at some point, a loss to be sustained by the brokerage and/or agent because of the reduced commission schedule. Therefore, it is up to the individual brokerage or agent to determine when they are potentially going to cross this line, which will result in the agent not showing a specific property solely due to the cooperating compensation offered in the MLS."

Now obviously this case was decided in Iowa, and Hank practices law in Florida. In addition, Hank points out that because the decision in the Iowa case was neither published or appealed, it will have very limited value as a precedential case in the state of Iowa. And outside of Iowa, Hank says it will only have what he refers to as "persuasive authority" in any other state.

Knowing that the laws will vary depending on where you're currently working as a real estate agent, it's important that you know what the laws are when it comes to your obligations in representing your clients and prospects. So make sure that you know what the laws are in your area, and also make sure that you're constantly working within them, too.

But still it's nice to know that a court in the state of Iowa understands what we're up against today as real estate agents doing business in a world of discounted commissions, and that we shouldn't be obligated to work on transactions that could potentially hurt our success as businesspeople.