CRMLS General Counsel Ed Zorn and Leading Real Estate Companies of the World Chief Legal Officer Jessica Edgerton warned agents not to fall back on old practices, like sharing commissions.

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Take it from lawyers intimately familiar with the real estate industry: No matter what you think of the National Association of Realtors’ nationwide antitrust settlement and rule changes, don’t be the next target for more litigation.

CRMLS General Counsel Ed Zorn and Leading Real Estate Companies of the World Chief Legal Officer Jessica Edgerton spoke Thursday at Inman Connect New York in a session called “The Next Legal Storm,” imploring agents to avoid further litigation by falling back on old practices, like sharing commissions.

“Let’s stop the lawsuits,” Zorn told attendees on the main stage at the New York Hilton Midtown in Manhattan. “The way we’re going to stop the lawsuits is doing the right thing.”

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“I’m tired of the regulating and the lawmaking and the getting sued into corners here,” added Edgerton, who noted that her legal opinions are hers alone. “Let’s stop that.”

Zorn both advocated for the end of commission sharing between brokers and advised agents and brokers not to use standardized state forms that allow commission sharing.

“There’s no need to share a commission,” Zorn said. “There’s no need to make an offer of compensation from a listing broker to a buyer’s broker. Just let it go.”

Commission sharing raises the specter of buyers being steered away from listings that offer lower-than-typical commissions, according to the panelists.

Steering continues to be seen in the form of buyers asking their agents not to show them homes that don’t offer buyer-broker compensation, according to Edgerton, who said that the right thing to do in that situation was to show buyers all properties that meet their criteria regardless of offers of compensation and ask for buyer-broker compensation in their offer to the seller.

“Stop sharing commissions with each other and you can’t steer,” Zorn said. “If we make it unethical to share commissions, we’re there. It will work and we’re done.”

Edgerton advised listing agents to “raise the bar of professionalism,” have “really careful, transparent, clear, candid conversations with their sellers,” and to simply tell buyer agents that their seller is open to all offers that include a concession to cover the buyer’s representation fee, but without naming an actual amount and therefore violating their fiduciary duty by potentially leaving money on the table.

Another way that agents and brokers can avoid future lawsuits is by keeping the National Association of Realtors’ Clear Cooperation Policy, which requires listing brokers to submit listings to Realtor-affiliated MLSs within one business day of publicly marketing them, according to Zorn.

He noted that buyers who do not have access to certain listings if brokers keep them off of the MLS could potentially get together and sue under antitrust laws, as could buyer agents whose business is impinged from lack of access to listings.

Edgerton noted that Zillow had just come out with a study that found that 75 percent of Latino/Hispanic and Black homesellers are being encouraged by their listing agents to use a private listing network rather than submitting listings to the MLS compared to 25 percent of white homesellers.

“We got a problem here,” she said.

“This is going to exacerbate the issue of already underserved communities, already underserved homesellers leaving money potentially on the table. What does that mean for generational wealth?

“There’s also the question of … corporate redlining. What does that mean for, really, expansions of communities or do we have a bigger fair housing issue on our hands?”

Email Andrea V. Brambila.

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