Realtor Cartel Abuses of Article 1, Section 10 of the US Constitution -- Obligation of Contracts

2005-09-03T05:21:00.000-05:00

If you follow real estate developments in the news, you've
probably noticed that the National Association of Realtors,
NAR, has been coming under heavy attack from a number of
different angles over the course of the past year.

Private antitrust lawsuits, investigations by the US Department
of Justice (USDOJ) and Federal Trade Commission and growing
scrutiny by the media are just a few examples. (The New
Republic weighed in earlier this year and the Wall Street
Journal ran an editorial called "The Realtor Racket" in August
of 2005, too.)

One area, though, that deserves attention and has yet to get
it, is the proliferation of state laws, at the behest of
state Realtor association lobbies, that foist minimum service
standards upon licensees and consumers.

The net effect of minimum services laws, is that firms who
offer discount brokerage are statutorily required to provide
more services, with increased liability, and therefore have
to charge more for their services than they did prior to the
passage of these laws.

This adversely affects consumers who did not feel they needed
the extra services and did not want to pay for them.

Well, from what I can see, such laws, passed by the states,
are clear violations of Article 1, Section 10 of the United
States Constitution, which says--in pertinent part--that "No
State shall...pass any...Law impairing the Obligation of
Contracts...".

Now, if that isn't clear enough on the face, James Madison,
Father of the Constitution, goes on at length--in Federalist
#44--talking about impairments to the Obligation of Contracts,
and it is clear that he was speaking of exactly the kind of
interferences and impediments that the states are erecting
against free trade today.

Funny how little human nature has changed over all these years,
isn't it?

As one who is actively fighting against anti-consumer, anti-
small broker, trade-restraining laws, I am interested in your
opinions on the following:

1) What federal agency is charged with defending the United
States Constitution over violations of Article 1, Section 10
as it pertains to the impairment of the Obligation of Contracts?

I have contacts at the USDOJ and they tell me that any action
would have to be brought privately...which makes absolutely
no sense to me.

2) If a private action is necessary, what kind of attorney
would be the right one to pursue such an action against the
states in which these violations are occurring? (Any suggestions
on actual attorneys or firms to contact?)

3) What is your take on the applicability of Article 1, Section
10 to this issue?

Here, for your review, is a link to some information that could
help you formulate an opinion.

http://www.real-reform.org/obligation_of_contracts.pdf

Landmark Quote of the 20th/21st Century:

"Realtors have the right to lobby for legislative and regulatory
action -- even if the effect of such action would be anti-
competitive." Laurie Janik, General Counsel of the National
Association of Realtors, from a memorandum issued earlier in 2005.
Quoted, verbatim, from the August 12, 2005 Wall Street Journal
Editorial referenced above, "The Realtor Racket".

Jay Reifert, President/Director of Operations
REAL-Reform -- [Real Estate Agency Law-Reform]

http://www.real-reform.org

Broker/Owner, *** Excel-Exclusive Buyer Agency
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Realtor Cartel Abuses of Article 1, Section 10 of the US Constitution -- Obligation of Contracts