contract-law employment real-estate
Is it legal for a professional ethics group to demand that I &quot;respect&quot; other agents&#39; exclusive relationships with their clients?
<p>I previously asked this question on the <a href="https://law.stackexchange.com/q/43615/218">legality of anti-poaching agreements</a>. If it's not illegal for two companies to enter into an agreement not to poach each others' talent, why is it legal for a NAR® to state,</p>
<blockquote>
<p>REALTORS® shall not solicit a listing which is currently listed exclusively with another broker.</p>
</blockquote>
<p>Why is that though? I mean if I solicit a listing from a client who is locked into an exclusive listing with another broker, but the other broker isn't the procuring cause of the sale it sounds to me like the other broker will not be entitled to a commission and I will (subject to my contract). How is a non-compete between two brokers for a client in contract permissible in real estate, but not in other forms of employment?</p>
<p>Here are two questions from my practice ethics quiz (not exam)</p>
<blockquote>
<p>When can a REALTOR® “solicit” another broker’s exclusive listing?</p>
<ul>
<li>a. Never.</li>
<li>b. At any time – anti-trust laws prohibit restrictions on such activities  .</li>
<li>c. If the owner initiates the contact and the REALTOR® has not directly or in  direct  ly initiated the discussion¸ the REALTOR® can discuss the terms of a future li  sting  .</li>
<li>d. If the owner does not initiate the contact but the REALTOR® initiates a d  iscussion at a social event¸ the REALTOR® can discuss the terms of a future listing.</li>
</ul>
</blockquote>
<p>They're saying the answer is &quot;C&quot;. But how can it be legal to tell me that I compete with another broker for a client through a discussion I initiate with social even</p>
<blockquote>
<p>When can a REALTOR® deal with the client of another REALTOR® who has an exclusive agreement with the client?</p>
<ul>
<li>a. Never.</li>
<li>b. At any time – there are no restrictions on this activity.</li>
<li>c. If the client initiates the dealings.</li>
<li>d. If the client returns a call after the REALTOR® has initiated the dealings.</li>
</ul>
</blockquote>
<p>They're saying the answer is &quot;C&quot;. But again, if I prospective client calls me after a general mailing (which they permit) it's not clear to my how it's legal to say we can't compete and &quot;deal&quot; in terms of future listing or for business?</p>
<p>Just wanting to get a better idea of how these non-competition agreements work in real estate and what guiding law limits their use, and when they reach over into being anti-competitive.</p>

<h2>They are merely telling you what the law is</h2>
<p>There is a tort called <a href="http://tlfc.com.au/interference-contractual-relations-issues-poaching-employees-competitor/#:%7E:text=The%20tort%2C%20known%20as%20interference,party%20who%20procured%20the%20breach." rel="nofollow noreferrer">interference with contractual relations</a>:</p>
<blockquote>
<p>The question strikes at the heart of our economic and legal system both of which are based upon principles of freedom of contract and freedom of choice. However, <strong>parties that freely enter contracts cannot freely breach such contracts</strong> and Courts have shown that they are prepared in some cases to provide relief against unlawful interferences with contractual relations.</p>
</blockquote>
<p>If A (the vendor) has contracted with B (the realtor) it is unlawful for a third-party (you) to induce A to breach their contract. If you were to approach A and they then broke their contract with B, B could sue A for breach of contract and you for interference in contractual relations.</p>
<p>Anti-competition law is directed at ensuring there is a free and fair market for goods and services but once two parties have willingly entered a contract, they are no longer participating in the market.</p>
<p>Now, if A approaches you, that's on A and hence why the answer o both questions is c.</p>

<p>The answer by @DaleM is not wrong.</p>
<p>But, it is also true that the National Association of Realtors is a voluntary association whose members can enter into voluntary contracts with each other.</p>
<p>A member Realtor also, for example, submits to binding arbitration of commission disputes with another Realtor.</p>
<p>The only conceivable issue would be whether this was an anti-competitive practice barred by anti-trust attacks. But courts have not taken this position, in part, because someone does not have to join and be bound by its rules, and in part, because it isn't inherently monopolizing.</p>
