The Department of Justice (DOJ) issued an appeal to the Oklahoma legislature as it considered Senate Bill 673, but the request to make the language clearer about consumer protections may have to be repeated to the Governor of Oklahoma, Brad Henry, as the bill has already passed both the Senate and House and is in his hands for approval.

The Oklahoma bill requires all transactional and single-party brokers to "comply with all requirements of the Oklahoma Real Estate License Code and all applicable statutes and rules be available to receive all written offers, counteroffers or other communications concerning a transaction, and reduce offers or counteroffers to a written form upon request of any party to a transaction; and to exercise reasonable skill and care including: a. present timely presentation of all written offers and counteroffers..."

But the DOJ didn't feel those requirements were consumer-friendly enough. Explained the DOJ, "The Department of Justice neither drafted nor endorsed the revised version of Senate Bill 673 in the Oklahoma legislature. Our views were set forth in our letter dated April 8, 2005.

"While the revised bill is an improvement, it does not make sufficiently clear that consumers will retain the freedom to purchase only the real estate services they want. The language of Senate Bill 673, for example, does not make clear whether a consumer can tell his or her broker in advance that the consumer would like to negotiate the sale of the home without any assistance from the broker, and, as a consequence, pay less for the services that the broker does provide. Given the lack of consumer complaints about fee-for-service real estate brokerage services, we encourage the legislature to take the time to further clarify the language in the bill to ensure the preservation of consumer choice."

Last week, OK-SB673 was passed by a vote of 40 to 4 by the Oklahoma Senate and was passed out of the Oklahoma House of Representatives with an 89-7 vote. The next step is Governor Henry's signature.

"We couldn't be more pleased with this vote, which clearly demonstrates what we've claimed all along: legislative support of SB673 has been strong, despite questions raised by the Department of Justice and a handful of vocal opponents," OAR Chief Executive Officer Lisa Yates said. "The passage of SB673 is a victory for both the real estate industry and Oklahoma consumers. This language ensures that the consumer protections outlined in Oklahoma's Broker Relationships Act are retained while providing for fairness among Realtors in the marketplace.

The consumer protections outlined in Oklahoma's Broker Relationships Act, which are reiterated in SB673, include treating all parties with honesty, timely presentation of all written offers and counteroffers, timely accounting for all money and property received by the broker, providing a written estimate of closing costs and disclosing information about the property as required by the Residential Property Condition Disclosure Act, says the OAR.

"To protect consumers, Oklahoma's licensing laws have ALWAYS contained a minimum level of duties and responsibilities. SB673 does not force any new services upon real estate consumers in Oklahoma but ensures that they are protected through a minimum level of duties and responsibilities required of real estate brokers," Yates said.

Disagreeing with the DOJ that SB673 "does not make sufficiently clear that consumers will retain the freedom to purchase only the real estate services they want," Yates responded that "we added language to the conference committee report which explicitly states that nothing in the bill requires or prohibits a broker from charging separate fees for each duty or service provided during a transaction. Furthermore, it does not prevent consumers from contracting with real estate professionals to receive and pay for only those services the consumer wishes. In reality, SB673 preserves the existing hands-off policy of letting brokers set their own fees and fee structures, including menu-based or fee-for-services arrangements."

She says, "We believe the Conference Committee report for SB673 represents a better version of the legislation. All along, we've said SB673 is about upholding Oklahoma's Broker Relationships Act, and this bill ensures that Oklahoma consumers will still receive the protections they are entitled to under the law as it was originally passed."

The governor has until June 11 to approve the legislation with his signature.

"Our conversations with the governor's staff to date have been very positive, and we are hopeful the governor will do the right thing for Oklahoma consumers by signing SB673," Yates said.

The DOJ may elect to write Governor Henry in the same way it co-wrote a letter with the Federal Trade Commission the Governor of Missouri, urging him to veto a similar bill -- House Bill 174. "It would change current law to restrict the ability of Missouri real estate professionals to offer customized real estate services," said the letter. "The agencies expressed concern that the enactment of House Bill 174 would reduce consumer choice and cause Missouri consumers to pay more for real estate services."

Currently, says the DOJ, Missouri home sellers can choose between a traditional, full-service package of real estate brokerage services and a fee-for-service option that allows home sellers to purchase individual services from an a lá carte menu. If the bill becomes law, then customers will be forced to purchase potentially unwanted additional services, the DOJ claims.

In Missouri, explains the DOJ, home sellers have the option to purchase the service of listing their property on the local multiple listing service separately without also having to purchase the broker's negotiation service. If House Bill 174 is enacted, however, real estate professionals entering into exclusive brokerage agreements with their clients would have to provide a state-mandated minimum service package that includes many duties associated with negotiating a property sales contract. Because most multiple listing services in Missouri require a broker to have an exclusive brokerage agreement before real estate professionals may list properties, Missouri consumers in those areas will be adversely affected by this proposed change in the law.

"We have seen that consumers in Missouri and throughout the nation can save thousands of dollars on a single home sale by having fee-for-service options," said R. Hewitt Pate, Assistant Attorney General in charge of the Department of Justice's Antitrust Division. "If this bill becomes law, Missouri consumers will be denied the benefits of robust competition without obtaining any countervailing benefits."

The joint Department of Justice and FTC letter said that the bill would likely harm competition in two ways. First, consumers who live in areas where real estate professionals are required to enter into exclusive brokerage agreements before they can post listings on the MLS will have to purchase these additional services and can expect to pay more. Second, without competition from fee-for-service brokers, the prices for traditional, full-service packages will likely increase.

The Governor of Missouri has until July 16, 2005 to veto House Bill 174. Under Missouri law, the governor must veto the bill for it not to become law. Should the governor not veto the bill, it will become effective on August 28, 2005.

Published: May 26, 2005

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Blanche Evans is the award-winning senior editor of Realty Times, the Internet's leading independent real estate news service. She is featured daily on the Realty Times Video Network in the "Realty Viewpoint" segment. Blanche has been named one of the "25 Most Influential People In Real Estate" by REALTOR Magazine, and has been twice recognized as a "notable." In 2005, she was named "Top Reporter Covering the NAR" by Delahaye-Bacon's. Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. To contact Blanche, email her at . For more articles by Blanche, click here.