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Legally speaking: Don’t let divorcing sellers get you in hot water

By Peg Ritenour, OAR Vice President of Legal Services/Administration

The OAR Legal Assistance Hotline receives an array of real estate-related legal questions — including license law issues, disclosure, contract law, ethics and commission problems, among others. In an effort to help you work within the law, our “Legally Speaking” series spotlights some of the timely questions that are being asked by REALTORS. This one involves the delicate issue of selling a home when the owners are the midst of a divorce dispute…

I listed a property owned by a couple who are divorcing. I have been working with the wife exclusively, who is still living in the home. I’ve had the property in the MLS and a sign in the yard for about 10 days. I was just contacted by the husband who is demanding I take my for sale sign down and remove the listing from the MLS because he wants to list with another brokerage. I don’t have the husband’s signature on my listing because the wife told me she had the sole authority to list the house. According to her husband that is not true. What should I do? Can he list the house with someone else without his wife’s consent?

A:  Unfortunately, handling the sale of property where the owners are in the middle of a divorce can often result in agents getting caught in the cross hairs of disputes that have nothing to do with them.

In this situation the first thing you should do is ask your client  (the wife) for written documentation that she had sole authority to list the property. If she provides this, you should be fine. However, you should advise your client to contact her attorney to handle this issue, as her husband is obviously disputing this.

On the other hand, if the wife misled you and didn’t have the right to list the property on her own, you could have a problem.

Why? Because under Ohio license law, a licensee must have the consent of the owner or the owner’s authorized agent to do any of the following:

  • offer property for sale or lease;
  • advertise the property; or
  • put a sign on the property offering it for sale or lease.

The Ohio Division of Real Estate and Professional Licensing takes the position that this provision requires a licensee to have the consent of ALL of the owners of a property before providing the services listed above. Therefore, now that you know that one of the owners (the husband) is objecting to your listing, to avoid a violation of the license law, I recommend that you stop offering the property for sale until this matter is resolved between the couple and their attorneys . This means you should take it out of the MLS, take your yard sign down and cease all other marketing efforts.

As to the husband’s ability to list with an agent of his choice, any other agent is also going to have to comply with the license law, meaning that his wife will likewise have to consent to that other agent offering the property for sale, advertising it or putting a sign in the yard.

To avoid problems when dealing with a divorce situation, I always recommend to REALTORS that both spouses sign the listing. This will provide documentation that you have the necessary consent of both owners before you spend time and money on marketing property. If one of the spouses claims to have the sole authority to list the property, I definitely recommend that you get documentation confirming that for your protection.

Tags: legal, Legally Speaking