Grievance Committee

1
Grievance Committee
2
Grievance Committee...

• initial review of and screens complaints and
  requests
• grand jury

3
Grievance Committee does not

• conduct hearings
• determine violation or award
• mediate or arbitrate business disputes

4
Grievance Committee

• appointed by president
• confirmed by board of directors
• balanced representation of membership
• mature, experienced, knowledgeable person

5
Arbitration requests
Important questions

• acceptable form
• necessary parties named
• timely filed
• parties have standing
• litigation pending
• impartial panel

6
Arbitration requests
Important questions

• basis for an award
• mandatory or voluntary
• amount too large or too small
• matter too legally complex
• knowledgeable arbitrators available

7
Arbitration requests

• Options for action
• forward for a hearing
• dismiss request

8
Arbitration requests

• Dismissal by grievance committee
• may be appealed by either party
• parties not attend

9
Ethics complaints

• Important questions
• complaint acceptable form
• necessary parties named
• timely filed
• respondent a member or MLS participant of board

10
Ethics complaints

• Important questions
• litigation pending
• impartial hearing panel
• amend complaint
• if complaint were true, could it violate Code

11
Ethics complaints

• Options for action
• amend complaint and forward for hearing
• forward complaint as submitted by complainant for
  a hearing
• dismiss complaint

12
Ethics complaints

• Amendments/dismissals
• dismissal appealable
• parties do not attend appeal

13
Ethics Hearing Procedures
Grievance Committee
Arbitration Hearing Procedures
Procedural Review Arbitration
Procuring Cause
Rehearings Ethics Appeals
14
Ethics Hearing Procedures
15
Hearing panel

• three, preferably five
• odd number

16
Hearing panel

• if REALTOR-ASSOCIATE or REALTOR other than
  principal is a party, at least one panel member
  should also be a nonprincipal
• panel chair named by chair of professional
  standards committee

17
Rights of parties

• counsel
• present evidence
• witnesses
• cross-examine witnesses
• make closing statement

18
Amending a complaint

• prior to hearing complainant may file. Hearing
  panel may disallow
• during hearing complainant or hearing panel

19
Witnesses...

• present only during testimony
• the REALTOR principal may remain throughout
  hearing

20
Hearing panels decision

• in writing
• findings of fact
• discipline

21
Discipline

• letter of warning
• letter of reprimand
• education
• fine not to exceed 5,000
• probation for one year or less

22
Discipline

• suspension from board membership for not less
  than 30 days nor more than one year, or a fine of
  5,000 in lieu of suspension
• expulsion from board membership for one to three
  years
• suspension or termination of MLS privileges

23
Ethics Hearing Procedures
Grievance Committee
Arbitration Hearing Procedures
Procedural Review Arbitration
Procuring Cause
Rehearings Ethics Appeals
24
Arbitration Hearing Procedures
25
Arbitration Hearing Procedures

• policy matters
• submission to arbitration
• arbitration hearing
• arbitrators decision -- executive session

26
Policy Matters

• timing
• fees
• consistency with state law
• prior litigation

27
Policy matters

• Timing
• within 180 days after closing
• within 180 days after facts could have been known
  with reasonable diligence
• whichever is later

28
Policy Matters

• Fees
• not to exceed 500

29
Policy matters

• Consistency with state law
• state law prevails
• Uniform Arbitration Act
• consult with board counsel

30
Policy matters

• Consistency with state law
• Variations from state to state include
• advance agreements to arbitrate future disputes
• agreements to binding arbitration after dispute
  occurs/arises
• law does not recognize agreements to arbitrate
  before or after

31
Policy matters

• Prior Litigation
• matter previously litigated cannot be arbitrated
• neither party to litigation may charge the other
  with failure or refusal to arbitrate

32
Submission to arbitrationOne of three options

• signed agreements and deposits before hearing
  held
• if no agreement/deposit, proceed if respondent
  participates in hearing
• if no agreement/deposit/attendance, proceed if
  state law allows

33
Arbitration hearing

• the panel
• witnesses
• rights of parties during hearing

34
Arbitration hearing

• The panel
• three, preferably five, members
• odd number

35
Arbitration hearing

• The panel
• majority of REALTORS
• if REALTOR-ASSOCIATE or REALTOR nonprincipal is
  involved, at least one panel member should be a
  nonprincipal
• chair of panel named by chair of professional
  standards committee

36
Arbitration hearing

• The panel
• challenges for good and sufficient cause
• additional state law requirements for arbitrators
  may apply

37
Arbitration hearing

• Witnesses
• present only during testimony
• a REALTOR-ASSOCIATE or REALTOR nonprincipal on
  whose behalf action was brought is not considered
  a party such nonprincipal may be a witness and
  is allowed to remain throughout hearing if
  affiliated with party

38
Arbitration hearing

• Rights of parties during hearing
• counsel (attorney at law)
• evidence
• witnesses

39
Arbitration hearing

• Rights of parties during hearing
• cross-examine witnesses
• make closing statement
• Note state law - subpoena power

40
Arbitrators decision

• executive session
• the award

41
Arbitrators decision

• Executive session
• parties dismissed panel makes award
• board counsel may be present to provide
  procedural guidance and answer legal questions
• no predetermined rules

42
Arbitrators decision

• The award
• Standard of proof
• preponderance of the evidence
• (the 51 percent rule)
• ethics - clear, strong, and convincing

43
Arbitrators decision

• The award
• Form of award
• only amount
• no findings of fact or rationale
• not greater than amount requested
• signed by arbitrators (or majority)

44
Arbitrators decision

• The award
• Form of award
• no dissenting opinion
• no discussions with parties
• in ethics can dissent

45
Ethics Hearing Procedures
Grievance Committee
Arbitration Hearing Procedures
Procedural Review Arbitration
Procuring Cause
Rehearings Ethics Appeals
46
Rehearings Ethics Appeals
47
Rehearings Ethics Appeals

• rehearings
• appeal hearings
• directors decision about appeal
• directors action if no appeal filed

48
Rehearings

• complainant and respondent have
• right to rehearing
• newly discovered evidence

49
Rehearings

• same hearing panel
• petitioner given opportunity to present new
  evidence
• scope of rehearing limited to new evidence

50
Appeal hearings

• Formalities
• deposit maximum 250
• in writing
• clearly state bases for challenge

51
Appeal hearings

• Respondents bases for appeal limited to
• misapplication of Articles of Code
• misinterpretation of Articles of Code
• procedural deficiency
• lack of procedural due process
• nature/extent of discipline imposed

52
Appeal hearings

• Complainants bases limited to
• alleged procedural deficiency
• other lack of due process which may have deprived
  complainant of opportunity for fair hearing

53
Appeal hearings

• Initial administrative review
• president or delegate reviews appeal
• determine if any legitimate basis
• if not, problem explained to appellant and
  additional detail requested

54
Appeal hearings

• Review by
• board of directors, or
• panel of board of directors, or
• executive committee

55
Appeal hearings

• The hearing
• petitioner limited to bases set forth in written
  appeal request
• hearing panel chair summarizes case

56
Appeal hearings

• The hearing
• each party may offer corrections to summary
• each party may present arguments

57
Appeal hearings

• The hearing
• no new evidence allowed, except as it bears upon
  claim of deprivation of due process
• arguments limited to issues raised in written
  appeal

58
Directors decision - appeal

• directors may adopt hearing panels decision and
  recommendation for discipline
• directors may modify hearing panels decision
  and/or recommendation for discipline

59
Directors decision - appeal

• directors may dismiss matter if findings of fact
  not supported
• if procedural deficiency, directors may
• refer case back for new hearing before
  different panel

60
Directors decision - appeal

• Modification of discipline
• directors may reduce discipline
• directors cannot increase discipline. Directors
  can refer back to original hearing panel with
  their written statement of concerns

61
Directors action - no appeal

• if procedural deficiency, directors may refer
  back for new hearing before a different hearing
  panel
• directors may reduce discipline

62
Directors action - no appeal

• directors cannot increase discipline
• if concerned with discipline, directors can refer
  back to original hearing panel with written
  concerns

63
Directors action - no appeal

• in the absence of an appeal or one of the other
  actions stated previously, the directors must
  adopt the hearing panels decision

64
Ethics Hearing Procedures
Grievance Committee
Arbitration Hearing Procedures
Procedural Review Arbitration
Procuring Cause
Rehearings Ethics Appeals
65
Procedural Review - Arbitration
66
Procedural Review - Arbitration

• appeal versus review in arbitration hearing
• request for procedural review

67
Arbitration hearing

• Appeal versus review
• no right to appeal award
• right to limited procedural review based solely
  on assuring that due process rights were observed
• process provides safety valve so no litigation

68
Request for procedural review

• Limited right of review based solely on
• failure of due process
• board failed to follow established arbitration
  procedures
• Note If not filed in 20 days from receipt of
  award, award final

69
Request for procedural review

• Request for review
• board of directors, or
• a panel of the board of directors, or
• executive committee

70
Request for procedural review

• Request should clearly set forth all bases for
  challenge
• use form A-13 in CEAM
• cannot say, I appeal

71
Request for procedural review

• Initial administrative review
• president or delegate reviews request
• purpose - to determine if request states
  legitimate basis
• if not, problem should be explained to party and
  additional information requested

72
Request for procedural review

• Directors executive session
• decision is final and binding
• only issue is whether proper procedures followed
  for due process
• if directors find hearing defective, award is
  invalidated. Case sent back for new hearing by
  different panel

73
Request for procedural review

• Directors executive session
• Parties can be released from obligation to
  arbitrate

74
Request for procedural review

• Review hearing
• arguments limited
• chair clarifies that award itself is not reviewed
• no new evidence except as it bears upon claim of
  deprivation of due process

75
Request for procedural review

• Review hearing
• standard rights to challenge
• hearing panel chair can respond to appellants
  allegation
• other parties to arbitration can support original
  decision

76
Ethics Hearing Procedures
Grievance Committee
Arbitration Hearing Procedures
Procedural Review Arbitration
Procuring Cause
Rehearings Ethics Appeals
77
Procuring Cause
78
Procuring cause - an overview

• basis for award
• facts to be considered

79
Basis for award

• No predetermined rule to determine
• entitlement
• no contract rule
• no threshold rule
• Determination based on all facts and
  circumstances related to particular transaction

80
Basis for award

• Blacks Law Dictionary, Fifth Edition,
• defines procuring cause as
• A broker will be regarded as the procuring
  cause of a sale . . . if his efforts are the
  foundation on which the negotiations resulting in
  a sale are begun

81
Basis for award

• Blacks Law Dictionary, Fifth Edition, further
  defines procuring cause as
• A cause originating a series of events which,
  without a break in their continuity, result in
  accomplishment of prime objective of the
  employment of the broker who is producing a
  purchaser ready, willing, and able to buy real
  estate on the owners terms

82
Factors to be considered

• Factor 1 No predetermined rule of entitlement
• rules of thumb, and prior decisions disregarded
• agency relationships not determinative of
  entitlement to compensation

83
Factors to be considered

• Factor 2 Arbitrability and
• appropriate parties
• questions of arbitrability and appropriate
  parties named can be considered by panel

84
Factors to be considered

• Factor 3 Relevance and admissibility
• generally, state law controls
• any relevant evidence is admissible

85
Factors to be considered

• Factor 3 Relevance and admissibility
• generally, state law controls
• any relevant evidence is admissible

86
Factors to be considered

• Factor 3 Relevance and admissibility
• Possible ethics violations in arbitration
  hearings
• can be considered part of evidence
• cannot be used to withhold an otherwise
  substantiated award
• should be considered only as one of the many
  potentially relevant factors in decision

87
Factors to be considered

• Factor 3 Relevance and admissibility
• Note hearing panel shall not make referrals of
  ethical concerns that arise during a hearing

88
Factors to be considered

• Factor 4 Communication and contact -abandonment
  and estrangement
• Abandonment whether the brokers inactivity,
  or perceived activity, may have caused the
  purchaser to reasonably conclude that the broker
  had lost interest in or disengaged from the
  transaction.
• (CEAM, Appendix II to Part Ten)

89
Factors to be considered

• Factor 4 Communication and contact -abandonment
  and estrangement
• Estrangement whether the broker engaged in
  conduct or failed to act which caused the
  purchaser to terminate the relationship. This
  can be caused, among other things, by words or
  actions.
• (CEAM, Appendix II to Part Ten)

90
Factors to be considered

• Factor 5 conformity with state law
• Factor 6 consideration of the entire course of
  events -- the list