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I changed firms – what can I tell my clients?

Posted by Editor on October 19, 2018
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Over the past five years, I’ve developed a substantial prospect base and been a top producer, but I recently – and fairly quickly – moved to a new broker. Normally, I would have waited until all my listings closed so I could finish servicing them, but I had to act quickly to accept a job opportunity that I just couldn’t pass up.

After the change, I contacted four of my sellers to let them know that I’m now the branch manager of another real estate firm in town, and all four insisted that they wanted to make the move with me – and they made it clear that they wanted to cancel their listings with my former broker.

What can I say? I’m good at what I do. I explained to each seller they could cancel their listing, provided each of them with a release and cancellation form, and offered to take their listings once they cancel their existing listings.

When my former broker found out, however, she refused to cut my sellers loose and filed an ethics complaint against me with my local board. If you ask me, I think this is unethical. I don’t see what I did wrong. Why should my sellers be held hostage by a listing agreement, especially if they specifically want me to sell their property?

My sellers are fuming, but so are the principals of my new brokerage. They’re considering letting me go because they don’t “condone” their new branch manager being the subject of an ethics complaint. It’s not like I took listing files with me – but maybe I should have? Signed: Thought I was Doing the Right Thing

Dear Thought I was Doing the Right Thing: While it’s not unethical to tell your customers that you can no longer service their listings, you’ll likely find yourself in an awkward position explaining why you aren’t allowed to coach them on how to terminate their current contract so they can change firms with you.

Sometimes the best practice is to move on and leave any departure announcements to your former brokerage. Remember, the listings you call “my listings” belong to the broker – not you. Some brokers often allow departing associates to take current listings with them; others do not. It’s a business decision rather than a personal one.

You can only take listings with you if your old broker assigns them to your new broker or cancels the listing. Any attempt to induce the sellers to leave your former brokerage is a big risk, and you could be found in violation of Article 16 of the Code of Ethics, citing Standard of Practice 16-20, which says: “Realtors, prior to or after their relationship with their current firm is terminated, shall not induce clients of their current firm to cancel exclusive contractual agreements between the client and that firm. This does not preclude Realtors (principals) from establishing agreements with their associated licensees governing assignability of exclusive agreements.”

Also: Any attempt to take listing files without the broker’s permission could result in you being right where you are today – named as a respondent in an ethics complaint.

Anne Cockayne is Director of Policy Services for Florida Realtors

© 2018 Florida Realtors®

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