Did you know that none of the jurors had sold a house before?
It was part of the screening too, and the defense attorneys were so cocky that they didn’t think it would matter. Their witnesses were a smart-aleck NAR CEO on his way out the door, and an elderly gazillionaire. Is anyone surprised we lost?
This is the American legal system, so there will be talk of settlement. Two brokerages already settled before the trial, and the other two would be smart to settle now – and leave the NAR to pay the bill. If NAR has to pay the entire amount, there will be trouble. They only have half of the money.
Given how quick the plaintiffs settled with ReMax and Anywhere (for only $130 million), a settlement could come flying down the pike any minute. Who knows? Are the NAR attorneys seeing the big picture, and crafting a settlement agreement that solves all the problems?
Probably not.
Can we package up all the things that can be manipulated into class-action lawsuits while we are at it?
Dual agency ensures that every buyer and seller in a transaction gets represented by an agent. But just the sound of ‘dual agency’ is nebuous – it sounds like realtors are up to something. There isn’t anything wrong with dual agency – in California, it is legit, legal, and practiced regularly by me and others. We like it!
But as we enter the single-agency era, only one agency/brokerage will be handling the sale. There will be two agents, but they are both employed by the same brokerage.
Today it’s called dual agency – because the broker represents both parties. The agents can give sound advice separately to their clients which qualifies as legitimiate represention, but lawyers could make it sound shady in front of inexperienced jurors.
If there will eventually be the Big Settlement, let’s find a way to include dual agency in it too so we can get on with the future of selling homes.
Going forward? After a settlement that absolves all previous dual agency, we should better describe the choices. In Colorado, there are transaction agents who don’t represent either side, but that sounds like it could cause a smaller commissions. Can we find the in-betweener that makes everyone happy?
As more buyers go direct to the listing agent to avoid paying a buyer-broker fee, they will be assigned a junior agent for assistance. A box needs to be checked here. Currently, you have to call it either single agency where that buyer is officially unrepresented, or call it dual agency.
While the listing agent is fully representing the seller and their best interests, the buyer only gets enough help from the junior-agent to make it to the finish line. Instead of dual agency, it’s more like single+ agency. Call it Agency 1.5.
Later a buyer could claim dual agency was the cause of all his troubles in the world, and sue realtors to get even. Did he get full representaion from his junior-agent that was comparable to the representation provided to the seller by the agent’s boss? It would sound unlikely and beg of another class-action suit.
Are agents going to call it single agency (only one side represented) and hope for the best?
Because it’s more than single agency, but not strong enough to be called dual agency.
Let’s add a third box for when the buyer gets the in-house junior agent: dingle agency.
If we don’t, we’ll be facing more class-action lawsuits shortly.
During the investor call, Reffkin declined to comment on the cases themselves but argued that Compass is “well positioned and prepared” for any changes that might come to the real estate industry. Reffkin explained that his optimism stems from several factors: Compass tends to operate in the luxury space where buyers are likely to still want agents; Compass agents typically have clients sign buyer-broker agreements; and Compass provides a variety of specialized tools and technology for both agents and their clients.
Reffkin additionally pointed to the Seattle region, where sellers have not been required to offer buyers’ agent commissions since 2019. Despite that change, commissions in the area remain in line with the rest of the U.S. — an outcome that suggests the bombshell lawsuits may not radically upend real estate’s status quo.
Wooosh over my head. Just call Jim.
Sorry – that was mostly for agents who not only have to do a spectacular job representing their clients, but they have to check the right boxes too.
It could probably be argued that having past experience selling through an agent could tend to prejudice a prospective juror, depending on whether the experience was good or bad.
The dispute before the jury was not whether any particular percent commission was justified by the services provided, but whether that percentage was the result of price-fixing agreements between parties who are supposed to be competing with each other.
Yes and I’ll testify that NAR or any of the other associations never attempted to sway the commission rate. All that ever happened was today’s brokers upholding 100-yr practices where the seller pays a bounty to the buyer-agent.
We already know that is is legal in Missouri to do so. The case is based on price-fixing – that NAR somehow conspired with agents to keep the commission rate high. There has never been a case of that happening, and every agent is on their own. If you want to work for less, then go ahead. Your quality of service isn’t the same as mine. You are economy class, while I’m first class – and if it costs the same why not go with the premium experience.
Under the law, there are three kinds of price-fixing agreements: written, verbal and “inferred by conduct.” In a civil action, the mere existence of a 100-year practice can become a “negative inferrence” in the eyes of a judge or jury, and smoking gun proof is not required to reach a conclusion that what is alleged is more likely to be true than to not be true. That’s what a defense has to argue against, and it doesn’t sound as if that’s what they did.