OGL 481 Pro-Seminar I:

PCA-Ethical Communities Worksheet

Worksheet Objectives:

1. Describe the four ethical communities

2. Apply the ethical communities to your personal case situation

1) Briefly restate your situation from Module 1 and your role.

My case involved a buyer and sellers’ agent who work for the same real estate company

and reside on the same team. Their clients entered into a transaction full force offering a very

clean offer including nonrefundable $10,000 earnest money. Their offer was strong given that

the title company had early on disclosed no CC&R’s were found on the property, allowing for

the buyers to build a second story to their home. Fast forward, after earnest money was

deposited, the title company did locate CC&R’s attached to the property in the commitment

report which would inhibit a second story to be built. Naturally, the buyer’s backed out of the

contract and asked the sellers to return their earnest money stating that they made it

nonrefundable based on the earlier information and disclosures given to them. The sellers felt

they shouldn't have to and had the support of their agent and my boss who also is part owner of

that particular title company. Furthermore, the buyers had the support of their agent, who has the

same boss as the seller’s agent, and our headquarters broker, who knew very little about the

complex situation. Ultimately the sellers returned the earnest money to the buyers after they

threatened lawsuits and freezing the money, which would tie the sellers into that transaction

inhibiting them from placing their house back on the market to receive additional offers. While
there was a result, tension is still running high in the office and there is animosity from different

parties towards the title company and the broker alike.

My role in this situation is to initiate the title search for any CC&Rs and HOA's attached

to the property. Once I receive this information, I upload it onto the MLS for all potential buyers

to see. Once under contract, in addition to the search, I send the title prelim commitment package

to the buyer or seller, in this case, both parties received the same commitment. This allows them

to review in case there are any additional findings.

2) Describe how the ethics of the organization influenced the situation.

Ethics play a huge role in real estate with this situation being no exception. Realtors’

ethics and fiduciary duties are to protect the confidentiality of clients and guide them

transparently through a transaction giving them responsibly, professional advice and educated

suggestions, making sure to refer out any legal advice to their attorneys or other professionals if

outside the realm of real estate. In this case, the buyer’s agent wrote the offer with a non-

refundable EM of 10K using his professional standpoint and ethical advice, having read over

what title had sent, stating there were no CC&Rs, and the client would be able to proceed with

improving the property. This is a tricky situation when another party of the transaction misses

their mark, but the clients are still contractually bound, and the sellers expect them to perform

with the false information they were given. On the other side, ethically the listing agent was

protecting his sellers by standing by the contractual agreement, reminding the sellers they were

rightfully entitled to the funds.

 In my opinion, the title company was lacking an ethically backed role as their database

search was faulty and led to several errors which contractually bound two parties, nearly leaving

one out of 10K. The title company has since revised its search process and crosschecking

procedures to boost its credibility and ethical information delivery. Additionally, knowing how

emotional, time-sensitive, and fragile these transactions can be, has made me and the agents

more aware to ethically take further steps than we originally were to make sure all correct

information is being portrayed.

3) Recommend how you would apply one of the ethical communities for an alternative

course of action regarding your case.

Although its already applied to our organization, The Family: Caring and Love (Bolman

& Deal, 2021) is 100% the ethical community that this situation used to help reach a resolution.

The community is not only applied to our clients with much compassion and dedication for their

well-being and protection but also to each other on our team which keeps us a cohesive unit and

well-rounded. I believe that in this situation, a little bit of that family community got lost on our

team and there was a division drawn between the agents who were pulled in several directions

trying to keep everyone happy and ethically perform to their highest and best potential.

This ethical community could have also been applied in a more unified way, involving

the team leader and both agents coming together with their clients to explain the situation, at no

fault to anyone, and mediate using ethics and compassion, hearing everyone’s side of the story. I

feel this alternative course of action would have created a stronger approach and more

understanding outcome as opposed to each agent discussing the situation with parties who

shouldn’t have been involved in such early stages of the situation.

4) Reflect on what you would do or not do differently given what you have learned about

ethics.

I personally think ethically based; our team did what it should have done regarding

protecting their clients. I would say though that compassion and communication could have

benefitted the situation and should have been stronger roles throughout. Other than those

suggestions, I feel that the title company should have better checked their information and once

realized their process was faulty, should have practiced good ethics and been a bit more vocal in

the situation, offering an optional correction, or help in some way.

Moving forward we have new checklists added to double-check our information coming

in and to further protect our clients from a mishap such as this again. We have learned a lot from

this transaction as a team and in our specific roles. Most importantly, we have all grown from it

and are taking action to practice even strong ethics than before.
 Reference
Bolman, L. G., & Deal, T. E. (2021). Reframing Organizations (7th Edition). Wiley Professional

Development (P&T). https://bookshelf.vitalsource.com/books/9781119756842