Legal Issues-Real Estate and the Internet

By MacCrate, James R; Roth, Audrey M | Real Estate Issues, December 1996 | Go to article overview

Legal Issues-Real Estate and the Internet

MacCrate, James R, Roth, Audrey M, Real Estate Issues

Authors' Disclaimers

This article discusses hypothetical situations. In the real world the facts of a given case will always significantly influence the advice given and the business strategy chosen. Real estate counselors should be aware of the specific laws, regulations and contract language that govern a specific activity or transaction and seek appropriate legal or business counsel and advice for each situation.

With the Internet, a revolution in the method of conducting commerce is emerging in the United States and globally. It is now possible to conduct real estate business activities electronically often at lower cost and with potential worldwide access and exposure. Only in its infancy, the Internet and its applications in the business world are an unknown virtual frontier whose limits are seemingly the limits of our imagination and creativity.

Because the Internet provides industry with new and uncharted methods of conducting business, it is critical to explore and understand the evolving legal risks and issues associated with it. In some instances, familiar rules of law apply. Often, however, existing laws simply do not work in the context of a digital, cyberspace world. Thus, the law is seemingly lagging far behind the rapid-fire growth of how business is being conducted on the Net. All areas of the law are being re-examined and slowly revised to address a new world of commerce.The law on the Net is evolving from day to day; indeed law is being made and remade every day.

In this evolutionary and revolutionary environment, it is extremely important to seek competent legal advice and to understand that there are many pitfalls and areas of uncertainty. As in other areas of real estate practice, legal advice should be sensitive to business as well as legal concerns. Lawyer and client must, together, decide how much risk to take in exploring the seemingly endless business possibilities and in weighing the potential legal consequences.

This article presents some of the common legal issues that might be confronted by real estate professionals who conduct business on the Internet. It describes a wide range of Internet activity-- from e-mail messages, to newsgroup postings, to multimedia presentations and linked material on World Wide Web (WWW) pages. It also provides a sampling of issues such as securities offerings, libel and slander, freedom of speech, copyright, electronic data interchange and service provider responsibility. At this early stage, however, there are few clear answers to any of these issues, and sometimes the answer depends on the circumstances of individual cases. Often the wording of agreements between user and service provider, or employer and employee, will create a form of private law that governs the situation. As the reader, consider the listing and discussion below as a series of caution lights to be observed with a combination of common sense and legal advice. By the time you read this overview, it is probable that the law and/or new methods of conducting business on the Internet will have evolved even further.

Freedom Of Speech And Privacy

The Internet freedom of speech issue appears in a number of different contexts, including the relative rights of employers and employees vis-a-vis e-mail access and the presentation of information on WWW sites and through other means on the Net.


The focus on e-mail differs somewhat depending on your status as an employer or employee. For employers, it is important to create a workplace environment without an expectation of privacy for the employee. A business is a business, and the employee should not be using e-mail for private purposes that may, in fact, be detrimental to business. Employers should develop policies which state that the employee will have no expectation of privacy. For the employee, your rights to "speak" on the Internet as an individual, versus your status as an employee of an organization, may well depend on what you signed when you joined the firm. …

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