Failure to Inform Commission in Alabama Real Estate

Instructor: Tara Schofield

Tara has a PhD in Marketing & Management

The Alabama Real Estate Commission oversees the actions of licensed agents, including any legal issues that are handled in civil court. This lesson gives insight into how to work with the commission in the event of a suit or judgment.

Alabama Real Estate Commission

When you became a real estate agent, you had to complete education and take an exam to test your knowledge of real estate concepts. You also agreed to follow the rules and regulations of the Alabama Real Estate Commission, the division of the government that oversees the activities of licensed real estate agents.

The commission's main concern is protecting the general public and clients from inappropriate or illegal actions of a real estate agent. Agents are required to get education, take a test, and agree to conducting themselves as professionals. If an agent mistreats his or her clients, the commission may step in to review the situation.

Communication with the Commission

The commission has rules specific to the communication of legal actions and issues that involve real estate agents. These rules are clearly stated to agents, and agents are expected to understand and follow the guidelines. If the agent has not followed the rules or has not protected his or her client, penalties may be imposed.

For instance, let's imagine your friend Brett is an agent who has recently been sued by one of his clients. His client claims Brett made false claims about the property and caused the client to lose a significant amount of money on the sale of his house. Brett lost the case and was forced to pay his client $50,000 in fines.

Because this suit was over a real estate transaction, Brett was required to alert the Alabama Real Estate Commission of the issue. In fact, he had to provide a copy of the charges and civil summons within 10 days of Brett being notified of the case. He contacted the commission and was instructed to mail copies of the documents via certified mail.

The commission must be informed of any suit, judgment, or other disposition relating to a pending or finalized real estate transaction. Because Brett's case was a result of a closed sales transaction, the information was relevant to the commission.

Likewise, if the case had commenced while the house was listed, Brett would be required to inform the commission of the problems with the listing. The commission has the right to investigate and review the details of the case and open its own investigation of Brett's actions.

Disciplinary Actions

The Alabama Real Estate Commission has the right and obligation to review all cases, complaints, or problems relating to a licensed real estate agent in the course of his or her work. In Brett's situation, the commission must review the details of the situation and determine if Brett broke any rules or mishandled his relationship with the client.

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