It is critical that developers employ well-trained sales teams. Sales personnel need to appreciate the nature of the property, its legal structure, as well as the applicable legal and regulatory requirements. Proper drafting of sales documents to comply with Florida, federal, and local laws, and ensuring that sales documents include necessary disclosures, are vital to a successful sales program. However, an often-overlooked issue is the proper training of a developer’s sales team. The proper training of a developer’s sales team can avoid claims and litigation by buyers in the future.
The sales team should be familiar with all provisions in the sales documents and well-trained to understand the terms of the sales documents, including all addenda, which a buyer is signing. Training and a good understanding of sales documents is necessary so sales personnel can provide appropriate responses to questions; incorrect information to a buyer can lead to later disputes and claims. In addition, sales personnel should be instructed not to provide buyers with interpretations of provisions in the sales documents, paraphrase, or provide buyers with legal advice; instead, they should instruct buyers to refer to the sales materials or pose questions to their own lawyers.
Equally important, statements made by sales personnel about the project, project amenities, structure of the project and development, and financial commitments must be consistent with the applicable project documents and sales materials. Buyers might use any statements made by sales staff, including those regarding views, schools and school assignments, recreational and other facilities, community charges, building and use restrictions, security, prices and market values, to create a dispute with the developer if the buyer becomes unsatisfied. Sales personnel should be trained to be careful about making absolute statements because development plans often change; disclaimers in documents that oral representations cannot be relied upon, might not necessarily shield a developer from liability if a statement to a buyer is considered ‘false’.
In addition, sales personnel should be trained with respect to communications with buyers from other states. Sales functions and marketing activities, including communications with buyers from other states, are subject to varying regulatory requirements. In addition to broker registration requirements, many states have laws and regulations prohibiting the marketing and solicitation of sales of property located in other states in the absence of registration in those states. Failure to comply with such requirements could lead to both civil and criminal penalties.
One guiding principal of a training program should be that once presented with information on the property, buyers should not be pressured to make a decision on the purchase. The property and location should largely sell itself, leaving the marketing and sales process low-key and “no pressure”. Developers that make significant investments in the recruitment and training of sales staff will see the best results in sales and the avoidance of disputes with purchasers. A comprehensive training program will help attract and cultivate the right caliber of salesperson and the mindset necessary to develop legal compliance and the relationships crucial to sales success.