Code of Ethics
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“to establish, promote and enforce high standards
– MLS Memberships: YachtWorld, MarineSource, YachtCouncil, YachtBroker
Yacht Brokers Association of America ~ Code of Ethics
(as amended September 18, 2000)
PART I: RELATIONS WITH THE PUBLIC
It is the duty of the Broker to be well informed on current market conditions in order to be in a position to advise his clients as to the fair market value.
It is the duty of the Broker to protect to the best of his ability, the public against fraud, misrepresentation and unethical practices in the yacht brokerage field.
The broker should endeavor to ascertain all pertinent facts concerning all vessels for which he accepts listings, so that he may present a fair description of the vessel.
The broker should not be a part to the naming of a false consideration in any document, unless it be the naming of an obviously nominal consideration.
The Broker should keep in a special bank account, separated from his own funds, monies coming into his possession in trust for other persons, such as escrows, trust funds, clients’ monies and other like items.
The Broker in his advertising should be especially careful to present a true picture and should neither advertise without disclosing his name, nor permit his salesman to use individual names or telephone numbers, unless the salesman’s connection with the Broker is obvious in the advertisement.
The Broker, for the protection of all parties with whom he deals, should see that financial obligations and commitments regarding yacht transactions are in writing, expressing the exact agreement of the parties; and, that copies of such agreements, at the time they are executed, are placed in the hands of all parties involved.
PART II: RELATIONS WITH THE CLIENT
In accepting employment as an agent, the Broker pledges himself to protect and promote the interests of the clients. The obligations of absolute fidelity to the clients’ interest is primary, but does not relieve the Broker from the obligation of dealing fairly with all parties in the transaction.
The Broker should not acquire an interest in or buy for himself, any member of his immediate family, his firm or any member thereof, or any entity in which he has a substantial ownership interest, vessels listed with him, or his firm, without making the true position known to the listing owner, and in selling vessels owned by him, or in which he has such interest, the facts should be revealed to the purchaser.
The Broker should not submit or advertise vessels without authority and in any offering, the price quoted should not be other than that agreed upon with the owners as the offering price.
In the event that more than one offer on a specific vessel is made before the Seller has accepted an offer, all additional offers presented to the Broker, whether by a prospective purchaser or another Broker, should be transmitted to the Seller for his consideration.
In the event that a Broker, brokerage house or central agent has received more than one offer prior to acceptance of any offer, all offers should be presented to the Seller. The broker shall act on the instructions of the Seller as to which offer shall be accepted and/or negotiated.
If an offer is made after owner has previously accepted an offer, the owner should be made aware of its existence.
This outline is a recommendation for a fair procedure for Brokers to follow when several offers are presented at approximately the same time. The procedure for handling any multiple offer situation should be discussed with the boat’s owner. Ultimately, it is a Broker’s obligations to act as the owner desires and by whatever guidelines he decides. Whatever solution is decided by the owner, all those making offers should be apprised of it.
PART III: RELATIONS WITH HIS FELLOW BROKER
The Broker should not voluntarily disparage the business practice of a competitor, nor volunteer an opinion of a competitor’s transaction. If his opinion is sought, it should be rendered with strict professional integrity and courtesy.
The Broker and/or Brokerage firm who holds a Central Listing should be respected. A brokerage firm in receipt of another Central Listing shall not solicit a direct listing from the owner during the term of the listing agreement. A Broker cooperating with a listing Broker should not invite the cooperation of a third Broker without the consent of the listing Broker.
The Broker should cooperate with other Brokers on vessels listed by him on a Central Listing basis whenever it is in the interest of the client, sharing commissions on a previously agreed basis. Negotiations concerning vessels listed on a Central Listing basis should be carried on with the listing Broker, not with the owner, except with the consent of the listing Broker. In the event a Broker obtains a Central Listing, he will endeavor to distribute the listing to all his corresponding brokers as quickly and as reasonably as possible.
Central Listings and shared open listings are generally shared on a commission basis agreed to beforehand as a matter of policy, or agreed upon by the cooperating parties negotiated on a particular sale.
Should the central or loaning Broker show the boat or perform work above and beyond the customary providing of the listing and negotiating with the owner, the commission arrangements should be reconsidered by the parties involved.
The selling Broker is the Broker who obtains a Purchase and Sale Agreement signed by both buyer and seller along with accompanying deposit.
Deposits on brokerage transactions (in an amount acceptable to seller) are handled in accordance with the provisions of the Association’s Purchase and Sale Agreement.
Binding Arbitration Procedure: When a dispute arises between two Brokers, the Brokers may choose to submit their case to Binding Arbitration as follows:
PART IV: RELATIONS WITH YACHT YARDS
Maintenance of good relations between yacht yards and Brokers is mandatory. Accordingly, the following procedures are recommended:
In summary, the Broker should do his job, not ask the yard to do it. Necessary services should be paid promptly.