Disputed Earnest Money and a Team-Name Ad

She may not decide the dispute herself, and she may not pay either party.

1. Secure the funds in a properly designated trust account - restored from the firm's own money, since the original deposit was misapplied.
2. Notify both parties in writing that the funds are held and will not be disbursed without (a) a written release signed by both, or (b) a court order.
3. Request the release. A signed mutual release is the clean, cheap exit and should be drafted and sent within days.
4. If the seller will not sign, the broker's remedy is to hold the funds and, if the standoff continues, file an interpleader and let a court decide who is entitled. Some brokers also notify the Commission of the dispute; the Commission's complaint process is not a forum for awarding the deposit, and the broker should say so to both parties rather than implying the Commission will resolve it.
5. Do not opine on the merits. Whether the buyer's notice was timely and whether the inspector was "unqualified" are contract questions. The written termination date versus the contingency deadline is the only fact that matters, and it is documented in the file.

Mishandling this alone can generate a license complaint independent of who wins the contract dispute.

Violations shown by the facts:

• Failure to deposit into a trust account promptly. Earnest money must be placed in the brokerage's trust account within the period the Commission's rules allow - not held in the firm's business account pending convenience.
• Commingling. Client funds in an operating account are mixed with the firm's own money, which destroys the ability to trace who owns what.
• Conversion / misuse. Spending a client's deposit on a marketing invoice is using trust money for the broker's own obligations - the most serious of the three, and the one most likely to produce suspension or revocation in addition to civil and possible criminal exposure.
• Likely recordkeeping failures. A broker who does this usually has no individual ledger, no reconciliation, and no paper trail.

Correction: replace the $10,000 from firm funds immediately; open or restore a properly titled trust account; set up a per-transaction ledger with monthly reconciliations; retain records for the period the rules require; and stop signing on the operating account for deposits. Then self-report to the Commission and to counsel - a documented, prompt cure mitigates discipline far better than discovery by an examiner.

Advertising. A team name alone is not enough. Advertising by licensees - including social media posts, boosted content, business cards, and signage - must identify the licensed brokerage. "The Summit Home Team" without Summit Realty's name leaves the public unable to tell who is actually responsible for the representation. The broker is responsible for reviewing and supervising advertising before it runs; a recurring unlabeled ad is also a supervision failure, not just a one-off typo.

The gas card. Compensation paid to an unlicensed person for referring real estate business is prohibited. Conditioning $250 on "a buyer who closes" makes the payment contingent on a completed transaction - that is a referral fee wearing a gift's clothing, regardless of whether it is cash, a card, or merchandise.

Where the line is: a genuine gift with no expectation of a referral and no tie to a closing is a marketing expense, not a referral fee. Change the promotion to an unconditional drawing open to anyone, or restrict it to licensed recipients, and it belongs to the broker's advertising budget rather than to an unlicensed third party.

Both issues are cured by one action: the broker reviews and signs off on all advertising and all incentive programs before publication.