Alabama Real Estate License Law &
The REALTORS Code of Ethics
• In Alabama all licensees must abide by license law
• Only members of the REALTOR association subscribe to the Code of
Ethics

Alabama Real Estate License Law &
The REALTORS Code of Ethics
• The Alabama Real Estate Commission is the enforcing body for license law.
• The local or state REALTOR association enforces the Code of Ethics as prescribed by the National Association of REALTOR.

Alabama Real Estate License Law &
The REALTORS Code of Ethics
• Violation of license law can result in fines, suspension, or revocation of your license.
• Violation of the Code of Ethics can result in fines, suspension or revocation of your membership in the National Association of
REALTOR.

History and Background of Alabama
Real Estate License Law
• Alabama license law was passed in 1951 and has been amended many times. The law is Title 34,
Chapter 27 of the Code of
Alabama

History and Background of the
Code of Ethics
NATIONAL
ASSOCIATION OF
REALTORS
 formed in
1908.

History and Background of the
Code of Ethics
At that time…
• No license laws.
• Real estate industry had a history of speculation, exploitation, and disorder.

History and Background of the
Code of Ethics
• Code was adopted in 1913 to establish a professional standard of conduct.
• Code of Ethics formed the basis for many license laws.


General Provisions

Licenses

Real Estate Consumer's
Agency and Disclosure
Act

Interference With Real
Estate Brokerage
Relationship


Duties to Clients and
Customers

Duties to the Public
 Duties to REALTORS®

The Structure of License Law and Administrative Code
• The commission may adopt and enforce all rules and regulations pursuant to the state administrative procedure statutes necessary for the administration of this chapter…
• Code of Alabama 34-27-8(a)

The Structure of the Code of
Ethics
• Three sections
– Broad statements of ethical principles
• Standards of Practice
– Support, interpret, and amplify the Articles under which they are stated

The Structure of the Code of
Ethics
• Case Interpretations
– Specific fact situations to which the Articles and/or Standards of Practice are applied
• Only Articles of the Code can be violated, though Standards of Practice can be cited in support of an alleged violation

• The commission or its staff may on its own, or on the verified complaint in writing of any person, investigate the actions and records of a licensee. The commission may issue subpoenas and compel the testimony of witnesses and the production of records and documents during an investigation. If probable cause is found, a formal complaint shall be filed and the commission shall hold a hearing on the formal complaint.

• A screening committee comprised of members of the Association appointed to the committee.
• Key question for the Grievance Committee:
If the allegations in the complaint were taken as true on their face, is it possible that a violation of the Code of Ethics occurred?

• Function is to conduct a full “due process” hearing with sworn testimony, witnesses and evidence.
• Hearing Panel is comprised of members of the Professional Standards
Committee.

• After conducting a hearing, the Hearing Panel decides whether there was a violation of the Code of Ethics, proven by clear, strong and convincing proof.
• If the Hearing Panel finds a violation of the Code of Ethics, the Panel then determines the discipline to be imposed on the violator (respondent).

Authorized Discipline
Alabama License Law
• May revoke or suspend a license until such time as the licensee has completed an approved continuing education course and/or made restitution to accounts containing funds to be held for other parties
• May also stay the revocation or suspension of a license and require completion of an approved education course and/or the making of restitution to accounts containing funds to be held for other parties
• Revoke or suspend the license
• Fine not to exceed $2,500
• Reprimand the licensee in each instance in which the licensee is found guilty

Authorized Discipline
Code of Ethics
• Letter of Warning
• Letter of Reprimand
• Education
• Fine not to exceed $15,000
• Probation for one year or less
• Suspension for not less than 30 days nor more than one year
• Expulsion from membership for period of one to three years
• Suspension or termination of MLS privileges
• Administrative processing fee (if found in violation) not to exceed $500 (“Court Costs”)

The Alabama Real Estate
Commission…
•
Mission - To serve the public through the licensing and regulating of real estate licensees.
•
Vision - To ensure excellence in the real estate profession.
•
Values - Excellence in stewardship, service, innovation, and integrity.

The REALTOR

Code of
Ethics …
• protects the buying and selling public.
• promotes a competitive real estate marketplace.
• enhances the integrity of the industry.
• is your promise of performance.
• is your promise of professionalism.