Brokers Should Update Their Contracts Now!

by Victor Lund on January 23, 2014

thumb_up_thumbs_downBrokers and agents can protect their online reputation with a small change in their contracts with consumers and terms of use on their websites.

If you have not taken a look at the HomeActions newsletter recently, you should. They write consumer articles that brokers or agents can send as newsletters or blog posts to their customers. It is one of my favorites. In today’s issue, they talk about the potential liability that a consumer may face if they publish a negative review about a service provider. In essence, companies are requiring customers to agree not to publish any negative remarks about them or their services. Perhaps it’s time for REALTORS® to include similar terms in their buyer and seller contracts to protect their reputation.

In the article, they share two cases where consumers were sued for fined for posting negative comments online. In the first case, a couple posted a report on Ripoffreport.com about a product they purchased. When they purchased the product, they agreed to a $3500 fine “if they took any action that negatively influenced the company’s reputation.”

In the second case, a consumer agreed in advance not to say anything negative about a dentist before services were rendered. When the consumer put up a negative review on Yelp, the dentist sued for breach of contract, fining $100 for each day that the remarks were not removed from the site.

I am not sure that these tactics will help brokers or agents manage their reputation online, but why not try? Update your website terms of use and your contracts with language to protect your online reputation in accordance with state law. At least you will have some form of standing when an insane consumer attacks your business without grounds.

Although I am not an attorney, I do know that contracts that have provisions for libel or other forms of broadcast defamation go a long way toward protecting individuals or companies.

If you want to go further, you may want to update your syndication agreement with publishers that indicates that they are also libel if their website allows consumers to post disparaging remarks about your company, its listings, or agents.

{ 1 comment… read it below or add one }

Giovanni Mascolino January 24, 2014 at 7:48 am

One does not need to update their contract to sue people for defamation. If someone posts a negative opinion of you or your services and you think that the comment constitutes defamation, you can sue within whatever your state statutes dictate. Typically you must give the defamer a period within which to remove the defamation language, and if they do not, you can proceed to sue.

This holds true whether you revise your contract or not. You do not need a contract to prevent someone from defamation, defamation is not allowed regardless.

And with or without a contract, you still need to monitor the social media sites for defamation.

Plus, if the person posts factual information, you may find it defaming, but you will have no course of action if the information is objective and provable. If it happens to all reflect poorly on you, that is too bad, contract or not.

This contract does not protect against anonymous posts, either, and there are many services out there that can anonymize (sp) your comments.

However, I am appalled that things have fallen to this level of cowardice – on both sides of the transaction? How about we all communicate our expectations and needs in a more professional way and DOCUMENT those expectations, then sign off on them when they are fulfilled?

Reply

Leave a Comment

Previous post:

Next post: