4. Law of Agency 3: Other Types of Disclosure and Antitrust Laws

Question 1

Antitrust

Answer 1

• business activity that attempts to monopolize, contract or conspire so others can’t compete/do business
• esp challange in real estate bc you have compete but also cooperate with one another

Question 2

NY Commission Escrow act

Answer 2

• $294 b of real property law,
• protects commission earned when clients refuse to pay at closing

Question 3

12 A $443a - Must not disclose

Answer 3

• lists issues that are not considered material facts/ NOT obligated to disclose
  1. Suspicion or actuality of Infection: owner or occupant was infected with illness
  2. Suspicion or actuality of crime: property was site or crime
• Buyer can submit written inquiry for the disclosure of such information, seller can choose to respond or not

Question 4

Must disclose

Answer 4

443 -a
1. material defects but must keep confidentiality and loyalty

242
1. no electrical
2. utility Surcharge
3. Uncapped Natural Gas Wells

333-c
4. agricultural district - smell noise

Question 5

$27-2018.1 Bed bug disclosure

Answer 5

• Property owners must give residents one year bed bug infestation history

Question 6

Megan’s Law

Answer 6

• in NY: sex offender registration act SORA
• requires States to notify communities of sex offenders
• requires sex offenders to register and register their addresses
• must register no later than 10 days prior to release
• brokers are not obligated to disclose

Question 7

Commission Escrow Act $294-b

Answer 7

• protects commission earned
• applies only to sale of residential property, condominiums or interests in a coop apt
• does not apply to vacant, commercial or leased property
• does not create lien on property
• Listing Agreement Must include statement “at the time of closing you may be required to deposit commissions with county clerk”
• only duly licensed broker can dispute commission by filing affidavit of entitlement
• commission can be withheld from sale price and placed into escrow account with country clerk
• affidavit must be filed within 60 days of escrow deposit , legal action within 6 months of deposit

Question 8

Federal Antitrust Laws/ Sherman Antitrust Law

Answer 8

• Ensure that consumers have optimum choices and optimum prices
• Ensure strong incentives exist for business to operate efficiently
• Keep prices down and quality up
• Ensure the protection of the process of competition for the consumer benefit
• Prohibits unlawful agreements between competitors including price fixing and group boycotts

Question 9

Group Boycotting

Answer 9

= group of competitors collectively agree NOT to conduct business with a third party to eliminate competition
= antitrust violation
- has pros and cons but is illegal

Question 10

Market Allocation

Answer 10

= competitors agree to not compete in specific markets by dividing up geographic areas, types of products or consumers, agreement between brokers to divide their markets or allocate customers to avoid competition
- type of prefixing
- Illegal practices
- Antitrust violation
- Takes away public freedom to chose

Question 11

Price Fixing

Answer 11

= per se violation
- Violation of antitrust laws,
= practice of setting prices for products, services or commission rates , rather than allowing open market determine rates and values. In Real estate price fixing occurs when competing brokers agree to set a standard price for commission or fees
- For example: discussing fees between brokers unless they cooperate on the same deal

Question 12

Tie in Arrangement

Answer 12

• Illegal antitrust action
• consumer is required to purchase additional products or service as a condition of doing business

Question 13

Disparagement

Answer 13

• putting competition down
  -making untruthful statement that harms reputation or standing in community (=slander)