Panel rejects bill governing realty agents

January 22, 1991|By David Conn | David Conn,Annapolis Bureau of The Sun

ANNAPOLIS -- A joint House and Senate committee decided yesterday not to draft legislation requiring real estate agents to confirm that a listing reflects the true condition of the property.

The Department of Fiscal Services had recommended legislation to require licensees to take affirmative action to confirm that listings for a property are accurate, saying "Licensees should not be able to 'turn a blind eye' or 'play dumb' so that they can unload inferior property on an unsuspecting buyer."

The decision, made by some of the members of the Senate Economic and Environmental Affairs Committee and the House Economic Matters Committee, is not binding on House or Senate members.

The seven-member joint committee did agree to draft bills that would add another consumer member to the Maryland Real Estate Commission, where consumers are now outnumbered 5-to-3 by industry members.

And the group agreed to send a letter to Licensing and Regulation Secretary William A. Fogle Jr. urging him to provide enough staff for the commission to investigate complaints adequately.

In one case, Bridgid and Jay Seering bought their Elkridge home in April of 1989, just before the rain came -- 13 days of it.

Despite the previous owner's attempt to cover up the basement walls with drywall, the extensive water damage soon became evident, Mrs. Seering said.

Worse, the real estate agent had to have known about it, she said, because the drywall was new and the agent, a friend of the owner, had been trying to sell the 8-year-old house for some time.

It took the Real Estate Commission nine months to tell the Seerings that the commission couldn't find the agent liable. The couple ended up paying $2,000 to make repairs.

"I was expecting a phone call from them to say, 'Let's have a hearing,' " Mrs. Seering said. "For them to decide just from one letter [of complaint], it didn't seem to make any sense."

The Seerings aren't alone in that view. A Department of Fiscal Services report, presented to House and Senate committees this month, found that 79 percent of people surveyed by the department said they were dissatisfied with the way the commission handled their complaints.

The complaint files show that the commission tends to rule for the licensees and is reluctant to award any money to consumers, the department found.

"In summary, the regulation of the real estate industry by the commission is inadequate," the report concludes.

Part of the problem, the Fiscal Services Department argued, is that existing law, which holds real estate agents responsible for material facts they "know or should know," is too vague.

Ed Hilley, a lobbyist for the Maryland Association of Realtors, told the legislators that the information on how complaints are handled is misleading.

"A tremendous number of these complaints have been dismissed administratively or for [lack of] legal grounds," Mr. Hilley said.

"We don't think that this automatic indictment of the commission is warranted by purely statistical figures."

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