May 23rd, 2022 at 3:42 pm
1. You DO Understand What “Procuring Cause” Is: As discussed in last week’s Legal Tip, “procuring cause” is generally understood to be a dispute between 2 buyers’ brokerages for the compensation offered through the MLS.
2. You DO Know That Procuring Cause Claims Are Decided By an Arbitration Panel: If you are in a procuring cause dispute, the final decision as to who procured the buyer is generally made by a panel of usually 3 arbitrators. Those arbitrators are real estate agents. The decision is not made by our brokerage, the other brokerage, or by judges, juries, or attorneys.
3. You DO Understand There’s No Triggering Event: The arbitration panel generally decide MLS matters using the C.A.R. Procuring Cause Guidelines (password-protected for C.A.R. members only). Those guidelines have 25 different procuring cause factors to consider. The arbitration panelists generally give weight to every factor, and make a decision based on the totality of the circumstances.
4. You DO Always Ask Buyer-Clients If They’ve Been Working With Someone Else: This is Preventive Tip #1 in the Procuring Cause Guidelines. If you discover your client has been working with another agent on the same transaction, you may need to contact that other agent early in the process to try to resolve the issue.
5. You DO Always Try to Get a Signed Buyer Broker Agreement (BRE): This one could be a game changer. Seven of the 25 procuring cause factors could weigh in your favor if you get your buyer to sign a Buyer Broker Agreement.
6. You DON’T Send Clients to Open Houses Without You: Several procuring cause factors that favor the Intro Broker look at which agent introduced the property to the buyer, and who showed it to the buyer.
7. You DO Try to Write the Offer: Several procuring cause factors that favor the Closing Broker look at which agent wrote up the offer, and who the buyer wanted to work with.
8. You DO Stay in Close Contact With Your Clients: The best-case scenario is when you are both the Intro Broker and Closing Broker (and everything in between)!
How Did You Score? 8 out of 8: Excellent; 4 to 7: Good; Less than 4: Need Improvement.
-Thank you to Jim Vermilya (Laguna Beach Manager) for suggesting this week’s legal tip!
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