The New York Times
Real Estate Q&A
1995
Q.: When real estate brokers prepare contracts of sale for residential
transactions, aren't they engaging in the unauthorized practice of law?
Lilian Marquez, Manhattan
A.: William A. Colavito, a Manhattan lawyer, who is chairman of the Real
Property Law Section of the New York State Bar Association, said, that the issue
of whether the preparation of real estate contracts by brokers constitutes the
unauthorized practice of law, is of ongoing concern to lawyers and real estate
brokers alike.
"And recently," Mr. Colavito said, "the office of the New York Secretary of State
issued an opinion letter regarding the matter. The opinion states that in general,
real estate brokers, who are not licensed to practice law in the State of New York,
are prohibited from rendering legal advice."
"According to the opinion," Mr. Colavito said, "any real estate contract provided
or prepared by a broker must either contain a provision making the contract subject
to a lawyer's approval or be on a form approved by a joint committee of the bar
association and realtors' association in the county, in which the broker operates.
In addition, the contract should contain a boldface caveat directed to the contracting
parties indicating that the document is a legal contract and recommending that they
consult with their respective attorneys before signing."