House Bill hb0593c1

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    Florida House of Representatives - 2002              CS/HB 593

        By the Council for Smarter Government and Representatives
    Bilirakis, Clarke, Kallinger, Garcia and Cantens





  1                      A bill to be entitled

  2         An act relating to real estate brokers and

  3         salespersons; amending s. 475.01, F.S.;

  4         revising a definition; amending s. 475.011,

  5         F.S.; clarifying application of certain

  6         exemptions; amending s. 475.15, F.S.; deleting

  7         a provision requiring only general partners of

  8         a limited partnership to be registered;

  9         amending s. 475.22, F.S.; specifying certain

10         sign requirements; amending s. 475.25, F.S.;

11         revising certain provisions relating to

12         disciplinary actions; providing an alternative

13         procedure for disbursing moneys from an escrow

14         account; authorizing salespersons to compensate

15         certain associated persons under certain

16         circumstances; authorizing brokers to place and

17         maintain moneys in an escrow account under

18         certain circumstances; providing procedures for

19         withdrawal of moneys from the account;

20         providing legislative intent; providing an

21         effective date.

22

23  Be It Enacted by the Legislature of the State of Florida:

24

25         Section 1.  Paragraph (j) of subsection (1) of section

26  475.01, Florida Statutes, is amended to read:

27         475.01  Definitions.--

28         (1)  As used in this part:

29         (j)  "Salesperson" means a person who performs any act

30  specified in the definition of "broker," but who performs such

31  act under the employment direction, control, or management of

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  1  another person. A salesperson renders a professional service

  2  and is a professional within the meaning of s. 95.11(4)(a).

  3  Nothing in this definition shall be construed to limit a

  4  salesperson from registering as an officer or director of a

  5  brokerage corporation or a general partner of a brokerage

  6  partnership.  A salesperson may also form a partnership,

  7  limited liability company, limited liability partnership, or

  8  corporation with brokers and other salespersons.

  9         Section 2.  Subsections (4) and (5) of section 475.011,

10  Florida Statutes, are amended to read:

11         475.011  Exemptions.--This part does not apply to:

12         (4)  Any salaried employee of an owner, or of a

13  registered broker for an owner, of an apartment community who

14  works in an onsite rental office of the apartment community in

15  a leasing capacity, provided the salaried employee works

16  without any other compensation being paid in addition to the

17  salary;

18         (5)  Any person employed for a salary as a manager of a

19  condominium or cooperative apartment complex as a result of

20  any activities or duties which the person may have in relation

21  to the renting of individual units within such condominium or

22  cooperative apartment complex if rentals arranged by the

23  person are for periods no greater than 1 year, provided the

24  person works without any other compensation being paid in

25  addition to the salary;

26         Section 3.  Section 475.15, Florida Statutes, is

27  amended to read:

28         475.15  Registration and licensing of general partners,

29  members, officers, and directors of a firm.--Each partnership,

30  limited liability partnership, limited liability company, or

31  corporation which acts as a broker shall register with the

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  1  commission and shall renew the licenses or registrations of

  2  its members, officers, and directors for each license period.

  3  However, if the partnership is a limited partnership, only the

  4  general partners must be licensed brokers or brokerage

  5  corporations registered pursuant to this part. If the license

  6  or registration of at least one active broker member is not in

  7  force, the registration of a corporation, limited liability

  8  company, limited liability partnership, or partnership is

  9  canceled automatically during that period of time.

10         Section 4.  Subsection (1) of section 475.22, Florida

11  Statutes, is amended to read:

12         475.22  Broker to maintain office and sign at entrance

13  of office; registered office outside state; broker required to

14  cooperate in investigation.--

15         (1)  Each active broker shall maintain an office, which

16  shall consist of at least one enclosed room in a building of

17  stationary construction. Each active broker shall maintain a

18  sign on or about the entrance of her or his principal office

19  and each branch office, which sign may be easily observed and

20  read by any person about to enter such office and shall be of

21  such form and minimum dimensions as shall be prescribed by the

22  commission. Each sign shall contain the name of the broker,

23  together with the trade name, if any.  For a partnership or

24  corporation, the sign shall contain the name of the firm or

25  corporation or trade name of the firm or corporation, together

26  with the name of at least one of the brokers.  At a minimum,

27  the words "licensed real estate broker" or "lic. real estate

28  broker" shall appear on the office entrance signs.

29         Section 5.  Paragraphs (d), (h), and (k) of subsection

30  (1) of section 475.25, Florida Statutes, are amended to read:

31         475.25  Discipline.--

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  1         (1)  The commission may deny an application for

  2  licensure, registration, or permit, or renewal thereof; may

  3  place a licensee, registrant, or permittee on probation; may

  4  suspend a license, registration, or permit for a period not

  5  exceeding 10 years; may revoke a license, registration, or

  6  permit; may impose an administrative fine not to exceed $1,000

  7  for each count or separate offense; and may issue a reprimand,

  8  and any or all of the foregoing, if it finds that the

  9  licensee, registrant, permittee, or applicant:

10         (d)1.  Has failed to account or deliver to any person,

11  including a licensee under this chapter, at the time which has

12  been agreed upon or is required by law or, in the absence of a

13  fixed time, upon demand of the person entitled to such

14  accounting and delivery, any personal property such as money,

15  fund, deposit, check, draft, abstract of title, mortgage,

16  conveyance, lease, or other document or thing of value,

17  including a share of a real estate commission if a civil

18  judgment relating to the practice of the licensee's profession

19  has been obtained against the licensee and said judgment has

20  not been satisfied in accordance with the terms of the

21  judgment within a reasonable time, or any secret or illegal

22  profit, or any divisible share or portion thereof, which has

23  come into the licensee's hands and which is not the licensee's

24  property or which the licensee is not in law or equity

25  entitled to retain under the circumstances. However, if the

26  licensee, in good faith, entertains doubt as to what person is

27  entitled to the accounting and delivery of the escrowed

28  property, or if conflicting demands have been made upon the

29  licensee for the escrowed property, which property she or he

30  still maintains in her or his escrow or trust account, the

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  1  licensee shall promptly notify the commission of such doubts

  2  or conflicting demands and shall promptly:

  3         a.  Request that the commission issue an escrow

  4  disbursement order determining who is entitled to the escrowed

  5  property;

  6         b.  With the consent of all parties, submit the matter

  7  to arbitration;

  8         c.  By interpleader or otherwise, seek adjudication of

  9  the matter by a court; or

10         d.  With the written consent of all parties, submit the

11  matter to mediation.  The department may conduct mediation or

12  may contract with public or private entities for mediation

13  services. However, the mediation process must be successfully

14  completed within 90 days following the last demand or the

15  licensee shall promptly employ one of the other escape

16  procedures contained in this section.  Payment for mediation

17  will be as agreed to in writing by the parties.  The

18  department may adopt rules to implement this section.

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20  In the alternative, a licensee may promptly disburse property

21  from a licensee's escrow account without notifying the

22  commission or employing one of the procedures listed in

23  sub-subparagraphs a.-d. and, notwithstanding any civil

24  liability that may exist, no administrative complaint may be

25  filed against a licensee solely because the licensee disbursed

26  escrowed property without first notifying the commission or

27  employing one of the procedures listed in sub-subparagraphs

28  a.-d. If the licensee promptly employs one of the escape

29  procedures contained herein, and if she or he abides by the

30  order or judgment resulting therefrom, no administrative

31  complaint may be filed against the licensee for failure to

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  1  account for, deliver, or maintain the escrowed property. If

  2  the buyer of a residential condominium unit delivers to a

  3  licensee written notice of the buyer's intent to cancel the

  4  contract for sale and purchase, as authorized by s. 718.503,

  5  or if the buyer of real property in good faith fails to

  6  satisfy the terms in the financing clause of a contract for

  7  sale and purchase, the licensee may return the escrowed

  8  property to the purchaser without notifying the commission or

  9  initiating any of the procedures listed in sub-subparagraphs

10  a.-d.

11         2.  Has failed to deposit money in an escrow account

12  when the licensee is the purchaser of real estate under a

13  contract where the contract requires the purchaser to place

14  deposit money in an escrow account to be applied to the

15  purchase price if the sale is consummated.

16         (h)  Has shared a commission with, or paid a fee or

17  other compensation to, a person not properly licensed as a

18  broker, broker-salesperson, or salesperson under the laws of

19  this state, for the referral of real estate business, clients,

20  prospects, or customers, or for any one or more of the

21  services set forth in s. 475.01(1)(a). For the purposes of

22  this section, it is immaterial that the person to whom such

23  payment or compensation is given made the referral or

24  performed the service from within this state or elsewhere;

25  however, a licensed broker of this state may pay a referral

26  fee or share a real estate brokerage commission with a broker

27  licensed or registered under the laws of a foreign state so

28  long as the foreign broker does not violate any law of this

29  state. However, when a broker has compensated a salesperson or

30  a legal entity formed and controlled by a salesperson, that

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  1  salesperson may compensate persons associated with the

  2  salesperson or legal entity.

  3         (k)  Has failed, if a broker, to immediately place,

  4  upon receipt, any money, fund, deposit, check, or draft

  5  entrusted to her or him by any person dealing with her or him

  6  as a broker in an escrow account with a title company, banking

  7  institution, credit union, or savings and loan association

  8  located and doing business in this state in a manner

  9  consistent with the broker's fiduciary obligations and

10  requirements of timely disbursement, or to deposit such funds

11  in a trust or escrow account maintained by her or him with

12  some bank, credit union, or savings and loan association

13  located and doing business in this state, wherein the funds

14  shall be kept and, with the written consent of the parties to

15  a transaction, invested in a manner not inconsistent with s.

16  18.10(2), until disbursement thereof is properly authorized;

17  or has failed, if a salesperson, to immediately place with her

18  or his registered employer any money, fund, deposit, check, or

19  draft entrusted to her or him by any person dealing with her

20  or him as agent of the registered employer. The commission

21  shall establish rules to provide for records to be maintained

22  by the broker and the manner in which such deposits shall be

23  made. A broker may place and maintain up to $5,000 of personal

24  or brokerage business funds in the broker's escrow account and

25  shall be provided a reasonable amount of time to correct

26  escrow account errors if there is no shortage of funds and

27  such errors pose no significant threat to economically harm

28  the public. It is the intent of the Legislature that, in the

29  event of legal proceedings concerning a broker's escrow

30  account, the disbursement of escrowed funds shall not be

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  1  delayed due to any dispute over the personal or brokerage

  2  funds that may be present in the escrow account.

  3         Section 6.  This act shall take effect upon becoming a

  4  law.

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