CATEGORY: Fair Housing

TITLE: A Group Home For Handicapped Persons Is Covered By The Fair Housing Act

 FACTS: The brokerage recently accepted a listing for a property located near a group home for recovering alcoholics and drug addicts.  The seller is concerned about potential liability for not disclosing the group home to prospective buyers.

ISSUE: Can the group home be disclosed to prospective buyers by the seller or listing agent?

ANSWER: No.

DISCUSSION:

The Fair Housing Act (the “Act”) prohibits discrimination against a person with a disability or handicap in connection with the sale or rental of a dwelling.  Under the Act, “handicap” is defined as: (1) a mental or physical impairment that substantially limits at least one major life activity; or (2) a record of such impairment; or (3) being regarded as having such an impairment.  See 42 U.S.C. § 3602(h).  Recovering from alcoholism and drug addiction is considered a handicap.  Therefore, the seller and listing agent are prohibited from disclosing the group home in connection with the sale of the property.

CATEGORY: Commission

TITLE: Buyer And Seller May Not Change Commission Terms Without The Broker’s Consent

FACTS: The buyer and seller signed an Addendum to the Purchase Contract that amended the terms of the real estate agents’ commissions.

ISSUE: Can the buyer and seller change the terms of the agents’ commission through an Addendum to the Purchase Contract?

ANSWER: No.

DISCUSSION:

The buyer is not a party to the commission agreement and therefore cannot agree to alter the commission. Furthermore, the commission should never be negotiated in the Purchase Contract or an Addendum to the Purchase Contract. Only the seller and broker can change the terms of the commission agreed to under the Listing Agreement.