The Maryland Real Estate Commission has declined to take disciplinary action against three Montgomery County real estate brokers convicted in 1977 of conspiring to violate antitrust laws. Thus the case -- which began with a country club dinner agreement in 1974 to raise commission rates from 6 to 7 percent and went all the way to the Supreme Court -- finally is terminated.
The commissioners ruled that the antitrust conviction of Robert W. Lebling, president of Bogley Inc.; John T. Carruthers Jr., president of Colquitt-Carruthers Inc.; and John P. Foley Jr., who heads Jack Foley Realty Inc., did not violate provisions of the state real estate act. That act calls for reprimand, suspension or revocation of license if the broker is convicted of certain crimes.
The listed offenses also include any "act or conduct (showing) bad faith, incompetency, dishonesty, fraudulent or improper dealings or conviction of a crime involving moral terpitude."
After soliciting an opinion from the state attorney general, the Maryland commissioners decided that the three brokers' convictions on grounds of conspiracy to violate antitrust laws did not fall into the bad-faith category.
The commission had ruled separately several months ago that it had no jurisdiction over the brokers' firms and three other companies that were also convicted along with them. The others were Robert L. Gruen Inc., Schick & Pepe Realty Inc. and Shannon & Luchs Co.
The individuals and firms were fined a total of $200,000, and the executives put on probation. A federal appeals court upheld the conviction, and the Supreme Court refused to hear the case. Meanwhile, rather than risk having to pay triple damages to the clients from whom they earned an extra $700,000 by raising commissions, the brokers agreed to settle companion civil cases.
Those who sold their homes through those companies during a three-year period were issued certificates entitling them to sell their homes at some future date at 5 percent commission.