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Legal Potpourri

posted by Shannon Holmberg | Aug 06, 2015

Keep tabs on these current legal issues in Iowa and around the country!

The Future of Disclosures?  

All REALTORS® know the important role disclosures play in real estate transactions. The list of required disclosures is lengthy and indefinite when it comes to the disclosure of “material adverse facts” about a property, but for New Yorkers, the list just got longer. In an effort to “increase transparency” in the luxury real estate market, the mayor of New York City has imposed a new disclosure for shell companies in the Big Apple by “requiring that the names of all members of a shell company buying or selling property be disclosed to the city.” The goal of the new disclosure rule is “to help identify real estate owners who may be avoiding city income taxes by claiming legal residency outside the city or even in the country,” and to prevent criminals from hiding real estate purchases by using a shell company— both ongoing phenomena in NYC. While this new disclosure has yet to be addressed in Iowa, the continued growth of urban markets may attract non-resident buyers to the Midwest, and The Hawkeye State may soon follow in the footsteps of the Big Apple.

For more on disclosures, read “To Disclose or Not to Disclose…” and take our Real Estate Disclosure QUIZ to tell us what you would disclose!

Mums the Word: A Facebook Fiasco 

Unless you’ve been living under a rock for the last decade, chances are you’ve heard about the dangers social media may pose when used improperly. Despite the fact that many users believe their posts are private, the ability to share this information is very easy and can be detrimental to your safety and even your employment. As well-known trial lawyer Roxanne Conlin discovered, what you post on Facebook may even be used against you in a court of law.

In early July, Roxanne Conlin was accused of polluting potential jurors in Polk County by commenting about a case on Facebook before it was scheduled for trial. Conlin’s post read: “I am going to trial on Monday in a case where Zane Blessum, a former county attorney . . . slept with his client and then beat her up . . . Yet another example of why an all-white, all-male court really needs a woman. I hope a jury will be a little harder on him!” The post was in response to Conlin’s disagreement with a lax punishment given to the defendant by the bar association’s Grievance Commission and then reduced by the Iowa Supreme Court. Blessum’s attorney asked that the trial be delayed as Conlin’s post would “clearly and unfairly influence potential jurors.” The trial is now scheduled for November. 

REALTORS® remember, your posts can do more than offend or annoy your friends and followers—they can get you into legal trouble and, if severe enough, cost you your business. “Mums the word” is the best practice for negative social media posts. Keep it positive and professional!

To read the full article in the Des Moines Register, follow this link:


Employees, Independent Contractors, and Uber…Oh My! 

If you’re a resident of Des Moines, Cedar Rapids, the Quad Cities, or the surrounding areas, you may have already hitched a ride with Uber (an on-demand transportation service) since its arrival in Iowa last fall. The ride sharing company has most recently set up shop in Ames, Iowa marking another large expansion for the service in Iowa and bringing along its fair share of controversy. Essentially, Uber operates as a taxi service that you can summon using a smartphone app—but with fewer regulations than what cab companies must abide by in terms of insurance and licensing.

The latest Uber-controversy relates not to local regulations, but rather worker classification. The California Labor Commissioner’s Office recently ruled that Uber had “misclassified one of its drivers as a contractor instead of an employee.” As a result, Uber had to reimburse the driver over $4,000 for expenses and costs incurred while driving for the company. 

Uber argued that it is merely the “provider of an app allowing drivers to connect with passengers,” but the California commissioner found that Uber is “involved in every aspect of the operation” from recruiting drivers to setting rates, and even “deactivating” drivers with low approval ratings. 

While this is a single case with a non-binding decision, it could signal a flood of potential litigation as drivers seek to be classified as “employees” that are entitled to unemployment and other benefits.

So what does this have to do with you? REALTORS® face a similar struggle as Uber drivers—the fuzzy line between independent contractor and employees. Recently a group of real estate salespeople in Massachusetts brought a class action lawsuit against their brokerages alleging that the brokerages misclassified the salespeople as independent contractors rather than employees, claiming that they were entitled to minimum wage and overtime. REALTORS® have always walked a thin line between brokerage supervision and licensing requirements and the “I’m my own boss” mentality. While the Massachusetts court decided these salespeople were independent contractors, the conversation will likely continue.

To read both articles in their entirety follow the links below:


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