National Association of Exclusive Buyer's Agents President Tom Early has trained the Department of Justice's guns on the National Association of Realtors, designated agency, and procuring cause, among others, he says.

Brokers write in to counter his opinions.

To Early's claim in his white paper that no state includes exclusive buyer's agency in state-mandated agency disclosure forms, Bob Hunt, a director of the National Association of Realtors, says, "Early is dead wrong about no state having an agency disclosure that includes exclusive buyer's agency as an option. California's agency disclosure, which has been around since the 80's, lists exclusive buyer's agency as one of the agency options."

He even supplies a PDF of the disclosure as added proof.

Jerry Hoffman, an Illinois broker, says Illinois provides exclusive agency disclosure forms as options.

"We have Exclusive buyer agency forms for those that want exclusive agency," he explains. "We have Nonexclusive buyer agency forms, for those that wish to clarify duties and responsibilities but don't want the limitation of exclusivity. These are optional. Disclosure of Designated Agency in writing is required for everyone. We also have disclosure forms for Non-Agency or Ministerial acts."

He says, "Obviously Tom Early has not given the issues he raises even the most cursory examination. I can't speak with authority outside of my own state of Illinois, but a brief search for basic factual information and then a reasonable application of commonsense, pretty much shoots him down.

"Point 1 in his paper ignores that the NAR was acknowledging and supporting the growing number of buyer agents as far back as the mid 1990's. A simple search at their site can bring up numerous articles and guidelines addressing Buyer Agency."

"Point 2 in his paper relating to "Dual Agency," he also misses the mark." says Hoffman. "Although "Dual Agency" is legal in many places it isn't encouraged. Listing agents in this state do not have to be dual agents to show their own listings to potential buyers or even to write offers for a customer on a clients listing. It does offer agents and customers/clients protection through written disclosure of what is and is not allowed. The key is sellers and buyers are treated equally and honestly."

"There is nothing antiquated about Procuring Cause, Point 3 of his paper. Agents must earn the "right" to "write" the offer. There are still many agents (buyer brokers and full service agents) who feel they can send their "clients" out to look at property with other brokers until they find the house of their dreams and then write the offer for that client. Why would anybody disagree with the basic tenet that one must earn compensation, rather than take what was earned by another. Nobody can interfere with a buyer broker's agreement in any way, including collecting compensation from their client. It is when they try and collect what they haven't earned from the transaction that creates a problem for buyer agents, as it does for full service agents."

"As for Point 4, discrimination against buyer brokers, I just don't see it. Every association provides education and training, exclusive and nonexclusive agreements, buyers agency designations, etc. In fact, NAR members must determine if a consumer has an exclusive agency relationship with another broker, and NAR rules prohibit interference with that agency. As for meaningful disclosure, many states do require disclosure, some states do not. The problem isn't with the statutes, it is with our profession not complying with the disclosure provisions -- limited service agents, buyer agents and full service agents alike. This is a training issue for the entire industry. States with these disclosure requirements must help educate the consumers as to what they should expect in the way of disclosure when working with a real estate licensee."

"How can anyone disagree that a listing belongs to the listing broker? The contractual agreement to sell that property is between the listing broker/brokerage and the seller. Nobody outside that contract can realistically expect to have any rights superior to the actual parties in the agreement. The listing agent/brokerage is charged with marketing that listing and must do so in the best interest of the client. As for our area, licensed agents of all flavors (buyer brokers, limited service and full service) get to show whatever is listed, other than office exclusives, which are rare. However, the contract is between a seller and a listing agent and only they get to determine how the information is distributed. I believe, if a buyer agent wants any control over the information, then they need their own contractual agreement with a seller. I suppose Mr. Early would prefer that we do away with listing agents altogether. Just let every seller place their own listing on the market however they can and let every licensed agent go find them for their clients. This concept that some third party deserves equal or higher benefits of another's labor and out of pocket expense is unfathomable to me."

"As for the comment about EBA's "steering" (extremely poor choice of term) clients away from certain homes, every agent representing a buyer has an obligation to advise their clients appropriately and educate them, so the client can make an informed decision about buying or not buying any given property, relative to comparative value to like property, or defects the agent is aware of, etc. Buyer agents don't educate their clients any more than any other professional agent fulfilling their obligations to the client."

"The NAR Standards of Practice and Code of Ethics have gone a long way towards enhancing the professionalism of the industry. I believe the SOP/COE protect the consumer and the membership against those who choose to be less than ethical and forthright."

"Perhaps Mr. Early should acquaint himself with the entire industry. All licensees can list, show and sell property. If you don't want to list property and share the fruits of your labors with others in your cooperative, don't expect those others to do it for you. When it comes to competition in the industry, membership numbers speak for themselves. I compete with over 30,000 licensees in northeastern Illinois. What other industry has that level of competition? I've been in the business for over 19 years and commission percentages have been declining."

Tom Early responds, "If the option of Exclusive Buyer Agency is included in the Calif. State mandated Agency Disclosure form it is news to me. If this is the case, it was not exaggeration -- it was a piece of information I simply did not have."

Published: November 22, 2005

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