Doug, Home Seller in California

Is it legal and/or ethical for a real estate agent to obtain the owner's signature on a residential real?

Asked by Doug, California Sun May 4, 2008

estate agency right to sell contract and NOT fill in the price?!!! This actually happened last week to my mom, who is a senior citizen living in assisted living, who is mostly together, although someone with power of attorney does her finances.
Thank you very much for your answers and opinions!

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Hello Doug. The question is not really whether having no price is legal or ethical. The question is whether there's a legally binding listing agreement since an essential element of the contract (i.e., price) is missing and therefore it appears that there was no meeting of the minds. Ethics and legality would come into play if the agent were to later fill in the price after your mom had already signed the form. The question of whether a legally binding listing agreement exists is a question for an attorney as it calls for a legal conclusion and real estate agents cannot give legal advice. You should speak to your mom and find out what she intends to do. If she is not going to return to her home, she may want to sell the house and perhaps the price was not filled in because she needed to think about it or consult with someone else. You definitely want to find out more about the circumstances of the signing of the listing agreement. You could contact the agent and see what he/she has to say about the missing price. Maybe that will clarify the situation. Good luck.
0 votes Thank Flag Link Sun May 4, 2008
Ute Ferdig -…, Real Estate Pro in New Castle, DE
MVP'08
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Doug
I saw this happen once before. A couple of suggestions.
I would suggest adding you to the title. All those on title must sign a listing agreement. Seniors are at risk, so having someone else other than your mother on title would be helpful.
Also, look into having a trust set up, and her property and estate put into the trust. Contact an attorney experienced with probate.
1 vote Thank Flag Link Mon May 5, 2008
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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Each party to the contract are to have a copy of the executed contract once it is signed. One could argue that what you have has not been fully executed by the seller(your mother). How can the brokerage office state that they have a listing to put your house on the market and seconly list it on the market without the most important part of the transaction, THE AGREED UPON LISTING PRICE? What happened to the seller's net sheet that was prepared to show profit/loss, commission cost, etc.... What exactly is your mother committing to? This is more on the legal side and I would state that you might want to consult with a real estate attorney in order to protect your family. You might be able to get to the bottom of this by contacting the Managing Broker or Broker of the office in order to get this right.
Web Reference: http://www.BrianSellsGA.com
0 votes Thank Flag Link Thu Sep 18, 2008
-Oldest son has power-of-attorney for this real estate transaction and all financials
What is this brother’s position on this? He is the person that should be contacting the agencies.

-Property is ALREADY on MLS under a "entry-only" type service.
You might have already exhausted the options with this brokerage. If you are being told that the docs are missing. The next step would be to contact the local association of Realtors that runs the multiple listing service in your area. It is important that it be your brother that has the power-of-attorney and that he have the document with him to prove his authority.

-None of the 3 sons were notified of the signed listing agreement until a day after.
Not even the one with the POA?

-No copy of the agreement was left with my mom
-Sales Price was left blank.
How do you know it was blank if no one has a copy?

-After requesting that all copies of signed documents be returned to our family, they all have mysteriously disappeared.
Your brother needs to consult an attorney.

Questions:
>>>Should I pursue an ethics claim with CA association of Realtors?>Should I pursue a legal claim with the State of CA licensing authority?>Should I just forget about it and move forward?
No don’t just forget about it. Yes your brother should act and file a complaint with the DRE (CA Department of Real Estate) the licensing body. Before he goes to the state level of Realtor Associations he should go to the local board.
Go to the local board then to an attorney and then to the licensing board.
0 votes Thank Flag Link Wed May 7, 2008
Jed Lane, Real Estate Pro in San Francisco, CA
MVP'08
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Hello Doug. I just noticed that you provided additional information. I would probably contact the agent's broker to discuss this just to make sure that everybody is clear that there is no legally binding listing agreement. What I don't understand is how you know that the price was not filled in when the agent did not leave a copy of the agreement with your mom. Are you just going by what your mom is telling you? I am also wondering if the agent somehow found out that there was already an MLS entry listing. While I understand that you don't think that your mom is responsible for what happened here, I think it might just be possible that your mom did not tell the agent all the facts just like she did not tell you anything until after she had met with the agent. It is often difficult for the elderly to give up their independence and sometimes they'll do things behind the backs of their loved ones because they are trying to prove that they are still in charge. Maybe the agent determined during his meeting with your mom that he was not going to have a listing agreement after all and that could account for him not completing all the paperwork and not leaving a copy. While I know that that are scam artists out there, I would not want to jump to that conclusion without having the full story. You know there's always the other side of the story and I have a feeling that we have not yet heard it.
0 votes Thank Flag Link Tue May 6, 2008
Ute Ferdig -…, Real Estate Pro in New Castle, DE
MVP'08
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From your additional information you provided, it does appear that the agent who signed the aggreement with your mom is not being upfront with you. The agent should be able to provide signed copies of all documents and if they are not in the agents possession, than you could very well argue that there is no listing agreement at all.

If the agent is not being up front and honest with you and you are not able to get the information you request, I would definitely broach the topic with the agent that unless they are willing to cooperate that you will contact an attorney. It may be a good idea to contact a real estate attorney to help you determine the best path in resolving the issues you outlined.

I would also encourage you to contact the agent's manager directly to see if the manager is able to help resolve the issues quickly. Under the circumstances you may want to request a cancellation of the listing agreeement. Obviously your mom would need to be involved in this process since she was the one who entered into the contract.

As was mentioned in a previous contract you may want to consider adding yourself, or your brother who is the power of attorney to title. This will ensure that when the property is listed that one of you will be involved, becuase for a listing agreement to be valid, all parties on title must sign the listing agreement.

If you do choose to file a complaint you will need to go to the CA Department of Realtors. Here is a link to the consumer page for the DRE http://www.dre.ca.gov/cons_home.html

I hope that you are able to resolve this issue in a timely manner and sorry that you are having such a hard time.

Lisa Cartolano
Alain Pinel Realtors
0 votes Thank Flag Link Tue May 6, 2008
I'm adding some more details about the situation:
-Property is in a living trust
-Oldest son has power-of-attorney for this real estate transaction and all financials
-Property is ALREADY on MLS under a "entry-only" type service.
-We were/are shopping for a full-service listing agent
-None of the 3 sons were notified of the signed listing agreement until a day after.
-No copy of the agreement was left with my mom
-Sales Price was left blank.
-After requesting that all copies of signed documents be returned to our family, they all have mysteriously disappeared.
-My mom is of course party to the "secret" listing agreement, but then she is an elderly person. I certainly am not holding her responsible.
Questions:
>>>Should I pursue an ethics claim with CA association of Realtors?>Should I pursue a legal claim with the State of CA licensing authority?>Should I just forget about it and move forward?
0 votes Thank Flag Link Tue May 6, 2008
Doug,

As has been mentioned by the other agents, when entering into a contract with the seller, there must be a price or a clearly defined timeline for determining the sales price of the property. Price is usually a big deal to the seller and I would be surpised to see a listing agreement without some mention or discussion regarding the sales price of the home.

There are instances when the agent and seller agree to set the sales price later after work has been completed or if additional research is needed to determine the best listing price. In this instance a waiver would be signed that will keep the home off the MLS unitl a certain agreed upon date. In this waiver you can state that listing price is to be determined by the seller by a specific date.

I would definitely contact the agent and the agent manager immediately to determine if this oversight was malicious or not.

It does seem that contacting the person who has power of attorney and ask why they were not involved or present when the listing agreement was signed. Did your mother make contact with the real estate agent?

It does seem that you may want to discuss with your mother that you might also want to become a power of attorney so you can help assist her with the paperwork and the sale of her home if that is what is in her current best interest.

Good luck and I hope you are able to resolve this issue quickly.

Lisa Cartolano
Alain Pinel Realtors
0 votes Thank Flag Link Mon May 5, 2008
Does you mother have a copy of the listing agreement without the price?
You've received the correct advice in the previuos posts so contact the brokerages manager and get them involved. It may be enough to get to the bottom of the situation. If you do not get immediate response contact an attorney and the association that runs the MLS to advise them of the situation.
Best case scenario is the agent was in a hurry to get it signed (shouldn't) and wants to do research to help determine the price and will come back to sit down with your Mom.
Worst case is something else and probably is unethical.
As a managing broker I would tell my agent it was not a valid contract until the price was on the document and was acknowledged by the seller. A contract cannot be changed above a signature with out being initialed and dated by the principle (your Mom).
0 votes Thank Flag Link Mon May 5, 2008
Jed Lane, Real Estate Pro in San Francisco, CA
MVP'08
Contact
A lawyer has to provide the answer. I'm not a lawyer, but...

The agreement your mom signed did have "consideration": the real estate agent's fee. That's the contract between the agent and your mom. Now, a sales agreement between your mom and a buyer would need a price (or a clearly defined way to set a price at a future date).

And keep in mind that most agreements between an agent and a seller result in a sales amount different than that which might be specified. In today's market, it's often lower. It doesn't make the agreement between the agent and the seller invalid.

There are, however, other questions. Was your mom mentally competent to sign the document? Even if she is, in this situation--especially since she's granted power of attorney to someone to do her finances--it might make sense to include a contingency in the contract requiring the approval of her financial advisor for a sale to be transacted.

Check with an attorney. But--and, again, this isn't legal advice--ask the attorney whether additional protections, such as the sales agreement being contingent upon the approval of a designated financial advisor to your mother, should be incorporated into the agreement. And, if the agent is resistant to such a provision, speak to the agent's broker.

Hope that helps.
0 votes Thank Flag Link Mon May 5, 2008
Don Tepper, Real Estate Pro in Burke, VA
MVP'08
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Dear Doug,

Have you called the Listing Agent's Broker and described the sitation. Perhaps a simple call would solve this problem. If the agent is the Broker, talk to him about the situation and ask him to tear up the Listing Agreement and mail it back to you. That could solve the problem. Or do you want the property sold? If yes, ask the Listing Agent to come back to finish filling in the Agreement.

If this does not solve the problem and in light of the fact your mother is not competent to handle her finances, I would suggest you and your mother together contact an attorney who specializes in real estate law as soon as possible. It does sound like you mother is not competent and if that is the case, I would presume she would be deemed incapable of selling her home. You did not mention the City in which you live, but you can call the California Bar Association and find an attorney in your area. Did the person who holds a power of attorney also sign the agreement? You need to get some answers.

Good luck,
Sally
0 votes Thank Flag Link Sun May 4, 2008
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