Transcript Georgia`s Brokerage Relationships in Real Estate Transactions Act

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