CIBS Program To Raise Ethical Standards
CIBS has developed a non-litigious formula for settling disputes over commercial real estate commissions and disputes. CIBS' mechanism has been successfully utilized for over almost 30 years.
There are three options in the formula, inspired by programs run by the American Arbitration Association:
- The first option is negotiation. Basically, this means you get together with the person you’re in dispute with, along with a member of the CIBS Arbitration & Ethics Committee, sit down over a cup of coffee and try to find a way to resolve the problem without the need of going further.
- The second level is called non-binding Mediation. This is done with two members of the Arbitration & Ethics committee and tries to help patch up the dispute between the parties, somewhat the way a marriage counselor might operate. The committee members can offer up some solutions and can recommend a resolution, but the decision is still upon the two parties having the dispute.
- The other option is arbitration, a more regimented approach in which the arbitrator acts much like a judge in a courtroom. The two committee members, who can be assisted by an attorney, review documentation from both parties in a dispute that back up a claim. If a building owner or another broker is involved, those parties are also summoned to the proceedings. Although attendance is voluntary, agreement to participate binds the parties to accept the decision as legally binding.
Many people use this method to resolve conflicts over commissions that just aren’t worth going to court over. Disputes typically occur when a client is shown a property by a broker then leases it with another; Or a client uses a broker to find a property, and then works out a deal directly with the building owner. Brokers should keep detailed records of every site they show and of every conversation they have with prospects.