Honesty’s the Best Policy for Any Job

A real estate agent was accused of forging her client’s signature, but it was later discovered that her client asked her to sign his name, so that he wouldn’t have to drive all the way back to her office.

The resulting conflict put her real estate license in jeopardy. The case was heard on appeal in an action entitled Cheri St. Pierre v. South Dakota Real Estate Commission, 2012 S.D. 25.

For most of us, the biggest purchase of our lives will be a piece of real estate: a house, a farm, or a business. Those transactions take a lot of planning, saving, and courage.

Even though the stakes are high, the public’s working knowledge of real estate sales is very limited. As a result, nearly everyone relies on a qualified real estate agent to guide them through the process. But how do you know if you have a good agent?

The real estate industry’s solution is to heavily regulate the licensing process, including those who want a license, and those who have one. The state Real Estate Commission also requires licensees to receive continuing education on topics like ethics, financing, contract law, and fair housing statutes.

In addition, the Legislature has adopted a list of 42 things which are considered “unprofessional conduct.” If a real estate agent or broker commits one of those acts, he or she can face suspension or revocation.

On that list of no-no’s are things like failing to keep sales proceeds in a separate bank account; being convicted of a crime of dishonesty; using dummy contracts to help customers obtain bank financing; failing to deal fairly with all parties to a sale; improperly influencing an appraisal; acts of “incompetency”; and even issuing a non-sufficient funds check.

Also on that list is a very broad “catch-all” provision that forbids “any other conduct which constitutes dishonesty.” This includes conduct in both the professional realm, as well as in an agent’s private affairs.

In short, there are plenty of ways to lose a real estate license, and anyone who isn’t absolutely honest in every aspect of his or her life is in the wrong line of work.

That’s a lesson that was impressed upon Cheri St. Pierre in this week’s opinion.

In 2007, Ms. St. Pierre worked as a real estate agent in Rapid City. She assisted three co-owners with the sale of a vacant lot. On closing day, the sellers signed their names (over and over) to the inevitable stack of documents that accompanies any land transaction.

Later, Ms. St. Pierre inquired about her commission, and her supervisor pointed out that there was one form still unsigned. The commission would be held back until she got it signed.

Ms. St. Pierre initially thought the form was pointless but agreed to call one of her clients. He was not eager to drive all the way back to sign one more piece of paper. He told Ms. St. Pierre to sign it on his behalf, and on behalf of his two other business partners (who were in California).

Ms. St. Pierre signed all three names, but didn’t reveal this when she turned in the form. Her supervisor became suspicious due to the speed with which the signatures had been obtained. She then noticed the signatures didn’t match those on earlier documents.

A peek into Ms. St. Pierre’s wastepaper basket revealed a crumpled “rough draft” with white-out on the signature line.

When confronted, Ms. St. Pierre claimed that she had received the signed copies via email. Unable to provide a copy of that email, she eventually confessed.

Ms. St. Pierre self-reported her misconduct to the Real Estate Commission, which then gave her a conditional, one-year suspension and fined her. She appealed this decision.

On appeal, Ms. St. Pierre’s lawyer argued that her actions didn’t constitute “forgery,” and, therefore, the suspension was unwarranted.

In response, the Real Estate Commission argued a different angle. It focused on the “catch-all” requirement that a real estate agent must be completely honest in every way. Here, there was no question that Ms. St. Pierre attempted to deceive her employer, its compliance staff, and then denied her actions when first confronted.

For all of these reasons, the Court agreed that Ms. St. Pierre had engaged in dishonesty and upheld her conditional suspension and $1,000.00 fine.

The public’s help is vital to weed out inept and dishonest members from the real estate profession.
If you suspect wrongful conduct in any way, do not hesitate to share your concerns with the Real Estate Commission. A complaint form can be downloaded by clicking on “Real Estate” in the forms section of the dlr.sd.gov website.

About the author

I'm a South Dakota trial lawyer, raised on a hog farm near Lennox. My cases tend to involve corporate wrongdoing (such as insurance companies that lie or deny claims, or both). science (such as whether someone had the mental capacity to execute a Will or Trust), or technical aspects (like construction litigation). I also regularly sue public entities that refuse to pay their fair share. I studied international relations as an undergrad at Georgetown University in Washington, D.C., and then graduated second in my law school class at the University of South Dakota. I'm an avid runner and a "family-taught" carpenter (i.e., I learned most of what I know from Grandpa, Dad, and my brother Steve). And I'm a kid at heart, with a love for model trains and my children's Legos. Beyond the practice of law, my most passionate endeavor is The Finish Line Fund. We founded this non-profit in 2017 in order to raise funds and expand research for rare diseases, including Friedreich’s Ataxia, which affects my 17-year-old daughter. You can learn more (and give) at TheFinishLine.org