Procuring cause continues to be the hottest question on the hotline in the past several weeks.  Multiple licensees are calling to ask whether they are entitled to compensation when they introduce a buyer to a property, and then the buyer skirts around their services and makes an offer through either another broker or on their own.   The Legal Hotline cannot provide a specific answer to the question of procuring cause.  That is simply because there are too many factors to be weighed in evaluating the situation, and that analysis needs to be left to an arbitration panel to weigh all evidence provided by the parties in dispute.

The National Association of REALTORS® (NAR) “Code of Ethics and Arbitration Manual,” provides a definition (paraphrased): The procuring cause is essentially the agent who originated the chain of events, without abandonment (agent leaving client) or estrangement (client leaving agent), that leads to the successful sale with that buyer.

Licensees with procuring cause questions should always keep the following in mind:

• There is no bright line rule to help determine who is the procuring cause.
• Illinois REALTORS® Legal Hotline cannot offer an opinion on which party is the procuring cause.

However, licensees who are trying to determine where they stand on a procuring cause question and whether they should pursue a remedy should consider the following resources:

• Illinois REALTOR® Ombudsman Program is an excellent resource for members with potential procuring cause disputes where issues might even get resolved and could be useful before filing for arbitration.
• NAR’s 17-question “Arbitration Worksheet” that lists pertinent questions for an arbitration panel to ask in considering a procuring cause claim.

Ultimately, a final resolution to a procuring cause dispute may require arbitration in front of a hearing panel that would consider all the facts and circumstances to determine who best fits the definition of procuring cause.

Buyers’ brokers should also consider the usefulness of an exclusive buyer brokerage agreement, which, while it does not guarantee a “win” in a procuring cause case, it can be a positive factor for consideration and might help them avoid some procuring cause issues.  Illinois REALTORS® has a form agreement available for members: https://www.illinoisrealtors.org/legal/forms/.

Illinois REALTORS® Resources 

In recent weeks the Legal Hotline has gotten numerous calls from members seeking different types of templates including template contracts for commercial properties, leases, residential sales and contract addendums.

While Illinois REALTORS® does not have every requested form, it  does have many valuable and modifiable forms, manuals policies and other documents available to its members.  These include, but are not limited to, various types of brokerage agreements, a form independent contractor agreement, property disclosure forms, agency disclosure forms and more.  Check out these helpful resources:  https://www.illinoisrealtors.org/legal/forms/.

Licensees and brokerages should have all forms reviewed by their attorneys to make certain they meet their needs and accomplish desired goals.