Georgia’s Brokerage Relationships in Real Estate Transactions Act (BRRETA) Purpose of BRRETA Purpose is to govern the agency relationships of brokers with sellers, buyers, landlords, and tenants The term broker in the following BRRETA slides means any person holding a real estate license Know these terms Dual Agency (not illegal, but does have to be in writing) Designated Agency Transaction broker Material facts Creation of an Agency Relationship Payment of compensation does not create agency Joining an information source (MLS) does not create agency Agency can only be created by a written contract. This eliminates unintentional agency An agent is not a fiduciary. Only reasonable standards of performance are required Broker Duties Seek a sale or lease at Properly account for the price & on the terms in the contract Present offers ASAP Disclose all material facts Advise clients to seek legal advise for matters beyond broker’s expertise all monies received Obey all applicable laws Keep information confidential unless required otherwise by law Antitrust Laws Purpose is to restrict monopolistic practices Applying the Law to Real Estate Brokerage Brokerage is viewed as a trade, not a profession Brokerage is classified as interstate commerce Violations Two or more brokers Refusals by real estate going into collusion to boards to admit set commission rates qualified members or prices on properties MLS is not allowed to Any agreement by restrict availability of brokers not to compete their services, prohibit in certain areas membership in more than one service, or refuse to take nonexclusive listings Georgia Fair Business Practices Act Fraudulent or Administered by misleading advertisements Advertisement must have an impact on the public as a whole “Advertising” applies to any media the governor through the Office of Consumer Affairs Tie-ins are not legal Contract Provisions to Avoid Preprinted commission rates Predetermined “listing duration” printed on the contract Predetermined “protection period” printed on the contract Protection period is a time period following the expiration of the contract during which the agent’s commission is protected Listing the Seller Listing – a broker’s contract of employment with an owner. Authorizes the broker find a buyer/tenant who is “ready, willing, and able” to meet the owner’s terms The commission has been earned even if the seller refuses the offer, changes the terms, or is unwilling or unable to close Termination of the Listing (Law of Agency) Performance Agreement Expiration of the Death of either term Revocation Renunciation Abandonment party Incapacity Extinction Supervening illegality The Right to a Commission: What to do if They Won’t Pay When the seller refuses to pay commission that the broker feels he/she has earned, three things must be proven in court – Valid real estate license – Written listing agreement – Broker was “procuring cause” of the sale Proving Procuring Cause Physically shown the property Followed through and communicated; or Provided a service, creating events that, without a break in continuity, contributed to the sale Listing the Buyer A listing contract is between the seller and the broker with whom the licensee is affiliated