“Realtor ⇒ Client ⇔ Client’s Attorney” vs.
“Client ⇔ Realtor ⇔ Client’s Attorney”
[Editor’s Note: The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway (“Berkshire”), or any other entity referenced. Edina Realty is a subsidiary of Berkshire.]
The listing agent and their excited client, the Seller, have just carefully reviewed the Buyer’s offer together, and the Seller has formulated a thoughtful Counter-Offer with their agent’s assistance.
Before sending it, however, the Seller makes what sounds like an innocuous request: “Please just run it by my attorney first.”
Unh-unh.
“Monkey(?) in the Middle”
Veteran agents know — and newbies will find out — that that chain of command is fraught with risk.
Namely, what do you suppose happens when the lawyer’s bill arrives 30 (or 90) days later, and the client is: a) shocked by the amount; and b) doesn’t remember authorizing their Realtor to involve their attorney?
That’s especially true if the deal the lawyer reviewed never came to pass.
“I Said to Run it by Who??”
All of which is why the prudent course of conduct for Realtors fielding such a request is to (politely) demur.
Instead, the appropriate Realtor response is, “Great idea! I’ll let you run it by your attorney, then get back to me as soon as possible”(of course, that’s after the Realtor provides their client with whatever documents they want their attorney to review).
Or if you prefer schematics:
“Realtor ⇒ Client ⇔ Client’s Attorney” > “Client ⇔ Realtor ⇔ Client’s Attorney”
P.S.: At least in Minnesota, where real estate agents have a statutory exemption to practice law without a license, it’s uncommon for clients to (also) consult real estate attorneys.
That’s especially so when the broker has excellent, in-house general counsel (Edina Realty has two); and their Realtor is a former corporate lawyer (CPA, too!). 🙂
See also, “Minnesota Realtors and the “Unauthorized Practice of Law”; “What If There Were No Hypothetical Questions?” (No, Really); “MN Association of Realtors Legal Hotline! May I Help You??”; and “Practicing an Ounce of (Legal) Prevention.“
