MAR Online Blog

On October 31 the jury in the Burnett v. NAR et al, class action lawsuit reached its verdict, finding that NAR and the co-defendants participated in a conspiracy to enforce the cooperative compensation rule ultimately leading sellers to pay more than they would have otherwise. The jury awarded $1.785 billion in damages to the Plaintiff class, which by law will be automatically trebled to roughly $5.4 billion. NAR President Kasper recently released the following statement on the verdict. It is important to understand that NAR plans to appeal and this case still has a long way to go before it is resolved.

What does the verdict mean for REALTORS® in Massachusetts?

The verdict doesn’t require that REALTORS® do anything differently. However, it does provide an opportunity to stress the value and importance of using an exclusive buyer agency agreement. These agreements are provided as part of the MAR forms catalogue. (See, Exclusive Buyer Agency Agreement, Forms #701, 702, and 703). These agreements maximize transparency, formalize the professional working relationship with clients, and detail services and expectations. Exclusive buyer agency agreements are just one example of the forms available to members that are maintained and regularly updated ensuring that members have all the tools they need to complete successful transactions.

Using an exclusive buyer agency agreement at the onset of a relationship also provides you the opportunity to explain to your buyer clients the benefits of your representation, the value of your services and exactly how compensation works in a real estate transaction. MAR’s form helps to frame the conversation so that both the buyer and REALTOR® have a transparent understanding of the relationship and the process.

REALTORS® should also be mindful of their duties under Article 1, Article 3 and Article 9 of the REALTOR® Code of Ethics. When representing a client as an agent, REALTORS® pledge themselves to protect and promote the interests of their client. This is a primary obligation that includes advising clients of company policies regarding compensation and cooperation (See, Standard of Practice 1-12 and 1-13). This obligation includes cooperating with other brokers when it is in the best interest of that client regardless of any offer of compensation. Reducing these understandings to writing whenever possible further serves to protect all parties.

The Massachusetts Association of REALTORS® will continue to provide updates as needed so please check back for additional information.