1 The Bases for Arbitration in the REALTOR  System Article 17 of the Code of Ethics Arbitration of disputes is limited to the conditions of Article 17.

2 Conditions of Article 17 Contractual disputes and specific non-contractual disputes defined in Standard of Practice 17-4; Between REALTORS  associated with different firms; Arising out of their relationship as REALTORS  …

3 Contractual v. Non-contractual Contractual Disputes, e.g. cooperating broker v. listing broker Non-contractual Disputes: Standard of Practice 17-4 –17-4(1) – 17-4(3): Cooperating broker v. cooperating broker – no listing broker need be named in the arbitration request. –17-4(4): Listing broker v. listing broker under open listings when the seller agrees to participate and be bound by the decision.

4 “Arbitrability” Determined by Grievance Committee. Article 17 is basis for Grievance Committee’s decision. Section 42 of the Code of Ethics and Arbitration Manual (CEAM) sets out Grievance Committee procedures in a request for arbitration. Appendix I to Part Ten of the CEAM discusses “Arbitrable Issues.”

5 The Uniform Arbitration Act Adopted in some form in many states. “Uniform,” but different from state to state (e.g. subpoenas). Modification of forms in CEAM by state legal counsel.

6 Procuring Cause Legal Concept v. REALTOR  System –Listing broker v. owner –Broker v. Broker

7 Procuring Cause General Legal Definition: Black’s Law Dictionary, Fifth Edition: “The proximate cause; the cause originating a series of events which, without a break in their continuity, result in the accomplishment of the prime object. The inducing cause; the direct or proximate cause. Substantially synonymous with “efficient cause.” “The proximate cause; the cause originating a series of events which, without a break in their continuity, result in the accomplishment of the prime object. The inducing cause; the direct or proximate cause. Substantially synonymous with “efficient cause.”

8 "Suggested Factors" Appendix II to Part Ten of the CEAM: “Arbitration Guidelines (Suggested Factors for Consideration by a Hearing Panel in Arbitration)” –Factor #1: No predetermined rule of entitlement –Factor #2: Arbitrability and appropriate parties –Factor #3: Relevance and admissibility –Factor #4: Communication and contact – abandonment and estrangement –Factor #5: Conformity with state law –Factor #6: Consideration of the entire course of events (“The Questions”)

9 Procuring Cause Concepts Uninterrupted series of events Abandonment Estrangement

10 Common Misconceptions The Threshold Rule The Contract Rule The Agency Rule

11 How Many Procuring Causes are there??

12 A Framework for Analysis Nature and Status of the Transaction Nature, Status and Terms of the Listing Agreement Roles and Relationships of the Parties Initial Contact with the Purchaser Conduct of the Brokers Continuity and Breaks in Continuity (Abandonment & Estrangement) Conduct of the Buyer Conduct of the Seller

13 Sample Fact Situation Analyses in the CEAM