AII Realtors know that a contract isn't enforceable until it has been signed. But Realtors also must operate on good faith, according to the National Association of Realtors Code of Ethics, a condition which means all parties must use care when they speak and when they listen.

Imagine a hypothetical situation, one where any resemblance to actual people or events is purely coincidental. Anne is a first-time home buyer. Working with Stephen, a buyer's agent, Anne put a contract on a condominium which was listed by Jack, an agent with another company.

Anne knew she was competing with another buyer who offered the seller a contract for the same purchase price but different terms. Offering to adjust her move-in date to suit the seller, Anne and Stephen waited to hear back from Jack. Jack called Stephen, and said, "We've got a deal."

Stephen called Anne, faxed the changes to her, she initialed the changes, and faxed the contract back. Stephen then faxed the initialed contract to Jack's office the same night.

The next morning, Jack gets the contract, has his seller initial the changes and faxes it back to Stephen. Stephen goes to Anne's office to get the earnest money and options fee, and get her initials on a hard copy as well as the faxed copy. He calls Jack to tell him that he is in the vicinity, and offers to bring the checks and contract by Jack's office. Stephen also offers to drop by the sellers' and get their signature. Jack tells Stephen that the sellers are working and have a function to go to that evening, and could he get the signatures the next day, Saturday?

Stephen says that will be fine, and that he would take the contract and checks to the title company.Saturday evening, Jack calls Stephen and says, "I am here with my sellers and they have decided to take the other contract." Jack does not offer the opportunity to Stephen to call Anne to see if she wants to counter the other offer.

Stephen is furious. When confronted by Stephen, Jack denies that he ever said that there was a deal, and points out that his sellers had never signed the contract. Sellers have every right to change their minds, he says.

Meanwhile, Anne believes that she has bought a home. She spends the weekend getting her financials in order.

Stephen delays telling Anne what happened until he can get in touch with Jack's manager, but he is unable to reach management until Monday morning. Jack's manager, Mary, says she will look into the situation.

When Anne learns that the deal is dead, she also calls Mary to complain, but a week goes by without Mary returning her call. Anne feels disappointed and snubbed by the brokerage. She feels that Jack and Mary should have responded to her complaint.

Jack tells Mary that he feels he acted appropriately. He abided by his sellers' wishes, and does not feel that he did anything wrong, nor does he feel that he owes Anne an explanation.

Anne has, in the meanwhile, told her friends what happened, and advises them to not do business with Jack or his company. Stephen has told all the agents at his office and anyone else who will listen what happened. Jack is annoyed with Stephen for trying to get him into trouble and for whining about losing a sale when he should have known that the deal was not a deal until the seller signed.

If you were the managing brokers for Stephen and Jack, what would you do? Is there any kind of "win" in this situation?

Both Stephen and Jack can point to sections of the NAR's Code of Ethics to make their points. Should Jack have told Stephen that his sellers were still considering the other buyer's offer? Should Stephen have insisted that the sellers sign the changes immediately? Should Stephen have waited to tell Anne she had a home until Jack's sellers had signed the contract?

Tell us what you think.