News & Media

Dear Anne: Don’t Turn Your Back on This Agent – Round II

Last month’s article on procuring cause generated a lot of interest, with some members disagreeing on which agent deserved a commission. But in real life, answers aren’t always easy – and they’re impossible until you hear from both sides.  

ORLANDO, Fla. – Dear Anne: I found your article in the June 17 Legal News interesting because, while no one owns a buyer, it seems there was interference from the other Realtor®.
Dear Anne: I feel like you partially missed the boat on your response in the latest “Dear Anne” column.
Dear Anne: I read your answer to a question on June 17 regarding proof of an offer being submitted to seller for a REO property. I’m a little confused and would like more clarification.

Dear Readers: As it turns out, my last article generated quite bit of interest. One of my readers said he agreed that an ethics violation did not occur, but he believes I “partially” missed the boat because I did not point out that the original buyer’s agent was the procuring cause of the sale and owed a commission.

In summary, the buyers’ agent made an offer contingent on the sale of the buyers’ home. Then the seller came back with an unusual request – to have his listing agent also list the buyer’s home in order to expedite both sales, saying he was confident his agent could get things done quickly. Suddenly, the buyers decided to put their home shopping on hold to focus on selling their home before they buy.

Sound fishy? It does to me.

So, let’s dive into the procuring cause side of the story.

To be upfront, I cannot tell you if the original buyer’s agent is procuring cause for two reasons:

  1. I’ve only heard one side of the story.
  2. It’s up to an arbitration panel of three-five arbitrators to make that judgement call – not me.

Arbitrators weighing a procuring cause decision must carefully consider the efforts on the part of both agents – do a “walk a mile in my shoes approach” to piece together the whole story to the best of their ability. The National Association of Realtors® (NAR) provides hearing panels with a worksheet they should use to guide them step-by-step through the transaction so they can determine who did what and who was ultimately responsible for the buyer ending up at the closing table. A comprehensive list of questions can also be found on NAR’s website.

Here’s what we do know about this case: The buyer’s agent showed the property and began negotiating the offer when the seller came back with his unusual request. But out of the blue, the buyers decided to put everything on hold.

Here’s what we don’t know: What occurred behind the scenes between the listing agent and the buyers?

Yes, we have our suspicions, but we need to know more. There are several definitions on procuring cause, but we’ll defer to NAR’s, which says, “procuring cause in broker-to-broker disputes can be readily understood as the uninterrupted series of causal events which results a successful transaction to come about.

The question is, did the buyers’ agent experience an interruption in his series of events after the buyer decided to step away in the middle of negotiations? The panel’s job is to ascertain whether a “break” occurred or not, and if so, did a new series of events begin with the listing agent? Or did the second series events occur while the first one was in motion? Who knows? The listing agent holds the critical pieces to the puzzle and that’s why we need to hear from him.

While members of the panel may believe the listing agent’s actions were underhanded and sneaky, did he get the job done? If he did, he could be the procuring cause. This takes us back to my first article where we concluded the agent’s behavior was not unethical and should have no bearing on whether he earned the commission or not.

On the flipside, a hearing panel could conclude that it was the buyers’ agent who brought a ready, willing and able buyer to closing.

Let’s face it, this one could go either way, and sitting on an arbitration panel is a tough job. I know this sounds wishy-washy, but there is no clear-cut answer on how a commission can be awarded. Who showed the property first or who wrote the offer doesn’t make it a slam dunk win.

Frustrating? Yes, I know. Best solution? Mediate. It’s better to sit down in an informal setting to negotiate an agreement acceptable to both sides of the dispute. It’s a win-win and it beats going to arbitration and taking your chances on the outcome.

Anne Cockayne is Director of Local Association Services for Florida Realtors

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