The Different Committees

It is standard practice across the country for the real estate industry to handle disputes at the local level through a Grievance Committee and a Professional Standards Committee. The National Association of Realtors provides these guidelines through the 17 articles in the Code of Ethics and Arbitration Manual.

“The purpose and role of the Grievance Committee is much like that of a grand jury in our judicial system,” says Doug MacArtney, a broker associate with Coldwell Banker Residential Brokerage in Downers Grove and chairperson of the Grievance Committee for the Mainstreet Organization of Realtors (MORe). “It acts as a grand jury in determining whether complaints or requests for arbitration or mediation will move forward to the Professional Standards Committee.”

The Grievance Committee mainly sees two different complaints: the first involves ethics violations, which are charges of violations to the Realtor Code of Ethics by a member that can be made by consumers or fellow agents. The second complaint involves requests for arbitration. Typically, these arise from a dispute between brokers over commission earned, and which broker is considered to be the “procuring cause” of the closed transaction.

Cases go from the Grievance Committee to the Professional Standards Committee, says Scott Lackie, the chairman of the Professional Standards Committee with the North Shore Barrington Association of Realtors and president of Griffith, Grant and Lackie Realtors in Lake Forest. The Professional Standards Committee makes decisions on matters involving ethics or arbitration that have been in front of the Grievance Committee already; the Professional Standards Committee is similar to a court, and the court abjudicates matters that come before it.

NAR provides guidelines for all local boards, and MORe’s Grievance Committee uses it as a base to determine whether a complaint moves forward to the Professional Standards Committee.

“The Professional Standards Committee is charged with holding appropriate hearings and giving due process rights to all parties, pursuant to guidelines within NAR’s Code of Ethics and Arbitration Manual,” says Amanda Withrow, the senior director of member care and professional standards for the Chicago Association of Realtors.

When a complaint moves forward to the Professional Standards Committee for a formal hearing, both parties are given the opportunity to plead their case.

“Examples of the types of violation allegations that typically come before the committee deal with questions of honesty, and adherence to proper procedures regarding the showing of listed properties,” MacArtney says. “In a nutshell, any agent who is completely above-board in their dealings with other agents and with the public, and operates at the highest levels of integrity, has nothing to worry about. They should know, however, that violations of the code in the name of ‘what is best for their client’ is not an excuse.”