Ethics Case Study

Registration of Domain Name Based on Sales Associate’s Name When Sales Associate Subsequently Leaves the Firm
(Case #12-24; adopted November 2008)

AZR November 2009


     


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NAR case studies illustrate common sources of conflict in our industry and show how the Code of Ethics’ Standards of Practice apply.
Standard of Practice 12-12
REALTORS® shall not:
  1. use URLs or domain names that present less than a true picture, or
  2. register URLs or domain names which, if used, would present less than a true picture.
REALTOR® P was the current broker-owner of the real estate brokerage firm founded by her grandmother. Always on the lookout for ways to attract top sales associates, REALTOR® P offered comprehensive training and benefits, including state-of-the-art technology tools, individual websites, and personalized domain names for each sales associate.

Sales Associate Q had enjoyed a long and productive relationship with REALTOR® P’s firm but, having gained considerable experience and a broad client base, decided the time had come to start his own firm. The parting was amicable except for one thing—Sales Associate Q’s domain name which, under the terms of his independent contractor agreement, remained the property of the firm. Attempts to negotiate a release of the domain name proved unsuccessful and, with no alternative available, Sales Associate Q filed an ethics complaint against REALTOR® P, alleging violation of Article 12 as interpreted by Standard of Practice 12-12. Sales Associate Q’s complaint noted that the domain name included Q’s first and last names and that any future use by REALTOR® P, now that Q was no longer a member of her firm, would present something less than the true picture required by Article 12.

At the hearing, REALTOR® P defended refusal to release the domain name on the grounds that at the time she had registered it, Sales Associate Q had, in fact, been a member of her firm, and that use of the domain name by a member of her firm had presented a true picture. Circumstances change, she noted, adding that at the time she had registered the domain name on behalf of both her firm and Sales Associate Q, her actions had been consistent with Article 12 as interpreted by Standard of Practice 12-12. “The fact that Sales Associate Q decided to start his own firm shouldn’t result in me being found in violation of the Code of Ethics,” she concluded.

The hearing panel concluded that REALTOR® P was not in violation of Article 12 as interpreted by Standard of Practice 12-12 because her registration of a domain name that used Sales Associate Q’s name occurred with the knowledge and consent of Sales Associate Q; at the time of registration, use by REALTOR® P’s firm satisfied Article 12’s true picture requirement; and that REALTOR® P had ceased any use of the domain name at the time Sales Associate Q left the firm. The decision also noted that while the Code of Ethics did not require REALTOR® P to transfer the domain name to Sales Associate Q, domain name registrations must be renewed periodically and that a future renewal of the domain name by REALTOR® P would be a violation of Article 12 if that domain name does not reflect a “true picture” of REALTOR® P’s business at the time of the renewal.

View the Code of Ethics online at www.realtor.org/code.

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