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Arbitration – What is it?
Arbitration is the resolution of monetary disputes between REALTORS® who, acting in their roles as principal or managing brokers of real estate brokerage firms, cannot come to terms on their own. Arbitration is a duty of membership as defined by Article 17 of the National Association of REALTORS® Code of Ethics. The procedure is handled via the GNIAR Grievance and Professional Standards Committees.
The following identify common concerns expressed about the arbitration process and responsibilities of members to submit to and participate in arbitration:
Mandatory Submission to Arbitration – The following situations are instances that require submission to arbitration:
“Every REALTOR® of the Board who is a REALTOR® principal, every REALTOR® principal who participates in a Board’s MLS where they do not hold Board membership and every nonmember broker or licensed or certified appraiser who is a participant in the Board’s MLS shall have the right to invoke the Board’s arbitration facilities in any dispute arising out of the real estate business with a REALTOR® principal in another real estate firm or with that firm (or both) or nonmember broker/appraiser or their firm (or both) who is a Participant in the Board’s MLS.”
Burdens and Standards of Proof:
In arbitration proceedings, the standard of proof for the hearing panel’s award is the “preponderance of evidence.” Basically, this means that the “evidence which as a whole shows that the facts sought to be proved are more probable than not.”
In ethics proceedings, the standard of proof for the hearing panel’s judgment is to be, “clear, strong and convincing.” Essentially, this is “proof which will produce a firm belief or conviction as to the allegations sought to be established.”
“Cooperation” Defined:
Based upon Article 3 of the REALTORS® Code of Ethics, cooperation relates to the obligation to share information on listed property and make access available to other brokers for showing to prospective purchasers when it is in the interest of the seller. Cooperation does not necessarily include an offer of compensation.
Separation of Ethics Complaint and Arbitration Request:
When an ethics and arbitration request are filed at the same time, arising out of the same facts and circumstances, the arbitration hearing shall be conducted first and the ethics hearing shall be conducted by a different hearing panel after the conclusion of the arbitration hearing.
Excerpted from Statements of Professional Standards Policy Applicable to Arbitration Proceedings.
Procuring Cause:
There is no one single factor that determines procuring cause in an arbitration proceeding. Rather it is a series of events that combine to determine the procuring cause. For a detailed description of procuring cause, click here.
Arbitration Request Form:
To download a copy of the GNIAR Abitration Request Form, click here.
For more information on these topics, please refer to the National Association of REALTORS® Code of Ethics and Arbitration Manual, under the heading of “Statements of Professional Standards Policy Applicable to Arbitration Proceedings.” Click here, to access the referenced page from the realtor.org website.
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