First, there is a clear distinction in the law between and the “conflict of interests” and “professional incompatibilities”. In Portugal there are some professions and professionals that cannot cumulate two activities at the same time and also there are some behaviours and acts that could be nullified due to conflict of interests. For instance, accountants, lawyers, solicitors and real estate appraisers cannot be real estate mediators. Also from an ethics standpoint lawyers or solicitors cannot litigate against former clients. There are also some agreements that are not admissible under the law. For instance some real estate agreements made by proxy against the will of the owner/represented. Apart from this there are a lot of grey areas difficult to apprise both from ethics and law.
Second, in Portugal the activity of condominium administrator is not regulated by law so it is compatible with almost any other legal or professional activity. However we could not say the same for real estate mediators and brokers. In 2004 Portuguese Government proposed “a prohibition for real estate agents to practise any trade or professional activities”, but this was ruled out by Portuguese Constitutional Court because it was a limitation to the right of profession. So in the regulations of the professional of real estate mediator from 2004 until 2013 there was a disposition that stated “subject to the provisions of special legislation, the real estate brokerage firms may also perform as secondary activity the administration of homes for others (Article 3 No 2 of Decree-Law No. 12/2004 of January 9th in the last version changed by Decree-Law No. 69/2011, of June 15t). This meant that from 2004 to last year several real estate mediators and brokers developed as secondary activity several other business, including rentals, condominium administration and even real estate appraisals and evaluations. But in 2013 this disposition was revoked and now under Law No. 15/2013 of February 8th the regime is substantially different. In article 7 of the real estate mediation and broker statute you can read the following disposition: “2 – It is expressly forbidden for the brokerage firm to: (…) b) intervene as a party in any business concerning to the property comprised in the mediation in which is a party”. This new regime inspired by European Law expressly prohibits the exercise of real estate mediation in conflict of interests regarding the estate under brokerage. This law it is understood by some as a way to circumvent the constitutional difficulties arisen in the 2004 attempt to limit the access to real estate agents to other professions and defending the consumers from doubtful situations from an ethics standpoint.
Therefore in our opinion a real estate admnistrator can also be a condominium admnistrator but not regarding the same property due to a clear conflict of interests as establish under article 7 of Law No. 15/2013 of February 8th.
Photo credits by Josefa Holland-Merten in Unsplash
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