The MLS Board of Directors did extensive research into the issue of co-exclusive listings and their legality in Massachusetts as well as their acceptance in our Multiple Listing Service database.   Here are the results:

What is a Co-Exclusive?

Although many will argue that the term is inherently contradictory, a co-exclusive listing is when two independent, licensed brokers act jointly as a fiduciary listing broker.

Are they legal? Are they ethical?

Yes to both!   Rest assured, there is absolutely nothing in state law or in our Code of Ethics that prevents any agency from entering into this type of co-listing agreement.   It is simply an alternative business agreement.   Consider too that open listings are also valid under state law, ethical and an acceptable business method of working as a fiduciary of a real estate seller in Massachusetts.   And, as you know, every business model has its pros and cons, some being display in the MLS, others not.

When two listing brokers are involved, isn’t it an open listing?

Maybe, but maybe not.   Many states have defined co-exclusive listings in their real estate laws, whereas Massachusetts has not.   The National Association of REALTORS®, author of our MLS Rules and Regulations, has created guidelines for acceptance or denial of co-exclusive listings in the MLS solely based on state law definition.   What a pickle!   For example;

• If state law defines a co-exclusive as “open” it is NOT to be allowed into the MLS database, but may be an agreement used by any participant if he/she chooses to do so.

• If state law defines a co-exclusive listing as “exclusive” it MUST be allowed into the MLS database, if a participant chooses to enter into such as agreement.

And therein lies the rub.

Without state definition, we have no clear basis for the acceptance or denial of co-exclusive listings into the MLS service in Massachusetts.   It has been suggested by legal counsel, that to allow co-exclusives into the MLS, we first would have to make a determination, on a listing-by-listing basis, what terms are included in the listing agreement so that we could preemptively classify the listing as “open” or “exclusive” and hope, should any issues arise, the courts would agree.

A Multiple Listing Service can not regulate the type of listings its Members may take. We just can regulate what is displayed in our database.

So what now?

It is unrealistic, problematic and places great liability on the board for the MLS to make determinations about alternative listing agreements in this manner.   The Rules currently state the MLS must accept exclusive right to sell listing contracts and exclusive agency listing contracts, and may accept other forms of agreement.   Further, the MLS Board looked closely at our current regulations, and the Service rules always refer to “the” listing broker.   It is clear that only one broker can enter a listing into the Multiple Listing Service database.

The Final Decision

The MLS Board of Directors approved the following motion:   Motion to accept only Exclusive Right to Sell agreements from one broker, as dictated by the current rules and regulations of the Service.

A consensus was reached that the three co-exclusive listings in the service today can remain there for the duration of the original contract with no extensions.   Each listing broker can continue to utilize the co-exclusive listing concept, and can extend these individual listings with the sellers, but all references to the MLS submission would have to be removed since display will cease at the expiration of the term of the agreement.