Lawyer ethics question


Old 01-25-07, 12:20 PM
Thread Starter
Join Date: Dec 2005
Location: USA
Posts: 50
Angry Lawyer ethics question

I know, "lawyer ethics" is an oxymoron, but ... here's the situation: a property was listed for sale, let's call it Property X. Someone placed an offer, and the seller accepted the offer (yes, there is a properly executed contract). Closing has NOT occurred yet.

One of the realtors involved, has disclosed the sale price of Property X and other details of the contract to a lawyer who is NOT involved in this property. The lawyer in question, is representing a completely unrelated client in a completely unrelated law suit, let's call it Case Y. The information about the sale of Property X (particularly the sale price) is very useful to the lawyer in Case Y. Trial of Case Y will begin, BEFORE the the closing date of Property X.

The lawyer disclosed the sale price of Prop X to his client in Case Y, and to the opposing lawyer, and to the opposing parties in Case Y -- in an attempt to obtain a favorable out-of-court settlement of the case.

Since Propr X has not closed, the sale price is not public information and should have been kept confidential by the realtor -- we already know the realtor has violated his ethics in USPAP.

The question is, has the LAWYER violated his ethics by passing along information which he knew was confidential and knew was unethically disclosed?

Sponsored Links
Old 01-25-07, 02:43 PM
Join Date: Aug 2000
Location: USA
Posts: 15,834
Your questions can likely be better answered by your State Realtors' Association and your State Bar Association. Codes of Ethics for realtors can vary from state to state. For instance, the National Association of Realtors Code of Ethics "effective January 1, 2006, an addition has been made to Standard of Practice 1 -13 of the RealtorŪ Code of Ethics. There it is stated that, when entering into a buyer, or tenant, agreement, a Realtor must advise his or her clients of "the possibility that sellers or sellers' representatives may not treat the existence, terms, or conditions of offers as confidential unless confidentiality is required by law, regulation, or by any confidentiality agreement between the parties."

Thus, if your state has no law or regulation that stipulates confidentiality and there is no written agreement between parties, then the offering price would not be confidential. If the offering price had bearing on Case Y, then there would not be a violation of ethics on the part of the realtor or the lawyer whether or not the sale of Property X had closed.
Old 01-26-07, 07:33 AM
Join Date: Sep 2004
Posts: 155
My vote is the lawyer did nothing wrong unless he knew the information he obtained was given in violation of some law. Lawyer says "I didn't know realtor was doing anything wrong. I thought she must have had consent from the buyer."

Here's another ethics question. Student is given an assignment by teacher on ethics and posts the question on the internet, asking for answers. Is this ethical? (grin)
Old 01-26-07, 01:01 PM
Join Date: Aug 2000
Location: USA
Posts: 15,834
"lawyer did nothing wrong unless he knew the information he obtained was given in violation of some law..."

Ignorance of the law excuses no man; not that all men know the law; but because 'tis an excuse every man will plead, and no man can tell how to confute him.
John Selden (1584-1654)
Old 01-27-07, 06:47 AM
Join Date: Sep 2004
Posts: 155
Ignorance of the law is no excuse, but many laws have a required element that the suspect knew the nature of his act. For example, it is a crime to knowingly receive stolen property. It is not a crime to unknowingly receive stolen property.
Old 01-27-07, 09:37 AM
Join Date: Dec 1999
Location: South Dakota
Posts: 3,140
At this point nothing unethical has happened. However, the unethical thing that may happen has to do with the lawyer in CASE Y. If he uses the information from Case X to get a good settlement in Case Y, and Case X does not close. Then the information used regarding the sale price of Case X is invalid and it may result in a big problem. One must remember that in Real Estate, there is not a sale until it closes. Until that time everything is just Jawbone.
Old 02-02-07, 03:55 AM
Join Date: Apr 2005
Location: Royal Oak, MI
Posts: 222
Originally Posted by Jeff Matthews View Post
Here's another ethics question. Student is given an assignment by teacher on ethics and posts the question on the internet, asking for answers. Is this ethical? (grin)
I vote yes, unless there are stated limitations on sources of information, asking for answers is no different than searching texts or joining a study group. And that aside, it doesn't relieve the student's obligation to perform due diligence to ensure that the answers he is given in response to his query are, in fact, correct answers.
Old 02-03-07, 04:37 AM
Join Date: Feb 2006
Location: USA
Posts: 929
This is a vote?

I vote no. The attorney often has an obligation to disclose anything he knows to the opposing side. This might be an instance. Depends on things you or I will never know.
Old 02-13-07, 04:56 PM
Join Date: Feb 2007
Posts: 21
Lawyer ethics usually don't apply in this situation.It has become a moral decision.Because a realtor is not a lawyer,there was no violation of ethical behavior by the lawyer.The information was acquired came from an independent source.Do you think that when a lawyer interviews people for a case and uses information gained from those to get a verdict considered a violation of his ethical duties?Because the realtor is not part of the states bar association or a practicing person of law any information gained from this person is considered well within the realm of ethical law behavior.The realtor may have broken some sort of his/her licensing association,but the lawyer did not.Would it made any bit of a difference if the buyers of property X were the ones to tell the lawyer of the purchasing price? Then he used this acquired information for the benefit of another case. No, it wouldn't matter.I am saying it is a moral decision because the lawyer has to make the decision on whether to use this acquired information if it will give him the upper hand.
Old 02-15-07, 06:08 AM
Join Date: Sep 2004
Posts: 155
In part, I agree with the last post. But I think there is/could be a difference when the lawyer knows the information he received was given to him by a source who violated a trust/rule/or confidentiality obligation. For example, if lawyer was able to obtain the secret Coke formula from a blabbermouth employee of Coke, knowing the employee was violating his confidentiality to the company, the lawyer would be obliged to keep it secret. For that matter, any person would (or at least there are good arguments in the law to make in that regard).

If the lawyer knows he is getting confidential information from a source that is violating a confidentiality requirement, there can be a fine line between "just happening to get it" and conspiracy to do wrong.
Old 03-11-07, 04:57 PM
Join Date: Mar 2007
Posts: 75
ethics Question

Based on the facts presented, the lawyer has violated no law or ethics requirement in Michigan. In fact, a lawyer has an affirmative duty to represent the best interests of his client. By not using this information, he may be in violation of that ethical cannon.

If anything, the realtor may have breached some law or canon they are bound by.

Good Luck!

Thread Tools
Search this Thread
Display Modes
Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On

All times are GMT -7. The time now is 12:55 AM.