As Introduced
131st General Assembly
Regular Session H. B. No. 532
2015-2016
Representative Smith, R.
A BILL
To amend sections 4735.01, 4735.06, 4735.07, 4735.09, 4735.10, 4735.141, 4735.18, 4735.24, 4735.51, and 4735.65 and to enact sections 4735.081, 4735.091, and 4735.23 of the Revised Code relating to real estate brokers and salespersons.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 4735.01, 4735.06, 4735.07, 4735.09, 4735.10, 4735.141, 4735.18, 4735.24, 4735.51, and 4735.65 be amended and sections 4735.081, 4735.091, and 4735.23 of the Revised Code be enacted to read as follows:
Sec. 4735.01. As used in this chapter:
(A) "Real estate broker" includes any person, partnership, association, limited liability company, limited liability partnership, or corporation, foreign or domestic, who for another, whether pursuant to a power of attorney or otherwise, and who for a fee, commission, or other valuable consideration, or with the intention, or in the expectation, or upon the promise of receiving or collecting a fee, commission, or other valuable consideration does any of the following:
(1) Sells, exchanges, purchases, rents, or leases, or negotiates the sale, exchange, purchase, rental, or leasing of any real estate;
(2) Offers, attempts, or agrees to negotiate the sale, exchange, purchase, rental, or leasing of any real estate;
(3) Lists, or offers, attempts, or agrees to list, or auctions, or offers, attempts, or agrees to auction, any real estate;
(4) Buys or offers to buy, sells or offers to sell, or otherwise deals in options on real estate;
(5) Operates, manages, or rents, or offers or attempts to operate, manage, or rent, other than as custodian, caretaker, or janitor, any building or portions of buildings to the public as tenants;
(6) Advertises or holds self out as engaged in the business of selling, exchanging, purchasing, renting, or leasing real estate;
(7) Directs or assists in the procuring of prospects or the negotiation of any transaction, other than mortgage financing, which does or is calculated to result in the sale, exchange, leasing, or renting of any real estate;
(8) Is engaged in the business of charging an advance fee or contracting for collection of a fee in connection with any contract whereby the broker undertakes primarily to promote the sale, exchange, purchase, rental, or leasing of real estate through its listing in a publication issued primarily for such purpose, or for referral of information concerning such real estate to brokers, or both, except that this division does not apply to a publisher of listings or compilations of sales of real estate by their owners;
(9) Collects rental information for purposes of referring prospective tenants to rental units or locations of such units and charges the prospective tenants a fee.
(B) "Real estate" includes leaseholds as well as any and every interest or estate in land situated in this state, whether corporeal or incorporeal, whether freehold or nonfreehold, and the improvements on the land, but does not include cemetery interment rights.
(C) "Real estate salesperson" means any person associated with a licensed real estate broker to do or to deal in any acts or transactions set out or comprehended by the definition of a real estate broker, for compensation or otherwise.
(D)
"Institution of higher education" means
either
includes
all of
the following:
(1) A state institution of higher education, as defined in section 3345.011 of the Revised Code;
(2)
A
nonprofit institution
as defined in section 1713.01 of
the Revised Code that actually awards, rather than intends to award,
degrees for fulfilling requirements of academic work beyond
high school
issued
a certificate of authorization under
Chapter
1713. of the Revised Code;
(2)
An (3)
A private institution
operated
for profit that otherwise
qualifies under the definition of an institution in section
1713.01 of the Revised Code and that actually awards, rather
than intends to award, degrees for fulfilling requirements
of academic work beyond high school
exempt from regulation
under Chapter 3332. of the Revised Code, as prescribed
in section 3333.046 of the Revised Code.
(4) An institution with a certificate of registration from the state board of career colleges and schools under Chapter 3332. of the Revised Code that is approved to offer degree programs in accordance with section 3332.05 of the Revised Code.
(E) "Foreign real estate" means real estate not situated in this state and any interest in real estate not situated in this state.
(F) "Foreign real estate dealer" includes any person, partnership, association, limited liability company, limited liability partnership, or corporation, foreign or domestic, who for another, whether pursuant to a power of attorney or otherwise, and who for a fee, commission, or other valuable consideration, or with the intention, or in the expectation, or upon the promise of receiving or collecting a fee, commission, or other valuable consideration, does or deals in any act or transaction specified or comprehended in division (A) of this section with respect to foreign real estate.
(G) "Foreign real estate salesperson" means any person associated with a licensed foreign real estate dealer to do or deal in any act or transaction specified or comprehended in division (A) of this section with respect to foreign real estate, for compensation or otherwise.
(H) Any person, partnership, association, limited liability company, limited liability partnership, or corporation, who, for another, in consideration of compensation, by fee, commission, salary, or otherwise, or with the intention, in the expectation, or upon the promise of receiving or collecting a fee, does, or offers, attempts, or agrees to engage in, any single act or transaction contained in the definition of a real estate broker, whether an act is an incidental part of a transaction, or the entire transaction, shall be constituted a real estate broker or real estate salesperson under this chapter.
(I)(1) The terms "real estate broker," "real estate salesperson," "foreign real estate dealer," and "foreign real estate salesperson" do not include a person, partnership, association, limited liability company, limited liability partnership, or corporation, or the regular employees thereof, who perform any of the acts or transactions specified or comprehended in division (A) of this section, whether or not for, or with the intention, in expectation, or upon the promise of receiving or collecting a fee, commission, or other valuable consideration:
(a) With reference to real estate situated in this state owned by such person, partnership, association, limited liability company, limited liability partnership, or corporation, or acquired on its own account in the regular course of, or as an incident to the management of the property and the investment in it;
(b) As receiver or trustee in bankruptcy, as guardian, executor, administrator, trustee, assignee, commissioner, or any person doing the things mentioned in this section, under authority or appointment of, or incident to a proceeding in, any court, or as a bona fide public officer, or as executor, trustee, or other bona fide fiduciary under any trust agreement, deed of trust, will, or other instrument that has been executed in good faith creating a like bona fide fiduciary obligation;
(c) As a public officer while performing the officer's official duties;
(d) As an attorney at law in the performance of the attorney's duties;
(e) As a person who engages in the brokering of the sale of business assets, not including the sale, lease, exchange, or assignment of any interest in real estate;
(f) As a person who engages in the sale of manufactured homes as defined in division (C)(4) of section 3781.06 of the Revised Code, or of mobile homes as defined in division (O) of section 4501.01 of the Revised Code, provided the sale does not include the negotiation, sale, lease, exchange, or assignment of any interest in real estate;
(g) As a person who engages in the sale of commercial real estate pursuant to the requirements of section 4735.022 of the Revised Code.
(2) A person, partnership, association, limited liability company, limited liability partnership, or corporation exempt under division (I)(1)(a) of this section shall be limited by the legal interest in the real estate held by that person or entity to performing any of the acts or transactions specified in or comprehended by division (A) of this section.
(J) "Disabled licensee" means a person licensed pursuant to this chapter who is under a severe disability which is of such a nature as to prevent the person from being able to attend any instruction lasting at least three hours in duration.
(K) "Division of real estate" may be used interchangeably with, and for all purposes has the same meaning as, "division of real estate and professional licensing."
(L) "Superintendent" or "superintendent of real estate" means the superintendent of the division of real estate and professional licensing of this state. Whenever the division or superintendent of real estate is referred to or designated in any statute, rule, contract, or other document, the reference or designation shall be deemed to refer to the division or superintendent of real estate and professional licensing, as the case may be.
(M) "Inactive license" means the license status in which a salesperson's license is in the possession of the division, renewed as required under this chapter or rules adopted under this chapter, and not associated with a real estate broker.
(N) "Broker's license on deposit" means the license status in which a broker's license is in the possession of the division of real estate and professional licensing and renewed as required under this chapter or rules adopted under this chapter.
(O) "Suspended license" means the license status that prohibits a licensee from providing services that require a license under this chapter for a specified interval of time.
(P) "Reactivate" means the process prescribed by the superintendent of real estate and professional licensing to remove a license from an inactive, suspended, or broker's license on deposit status to allow a licensee to provide services that require a license under this chapter.
(Q) "Revoked" means the license status in which the license is void and not eligible for reactivation.
(R) "Commercial real estate" means any parcel of real estate in this state other than real estate containing one to four residential units. "Commercial real estate" does not include single-family residential units such as condominiums, townhouses, manufactured homes, or homes in a subdivision when sold, leased, or otherwise conveyed on a unit-by-unit basis, even when those units are a part of a larger building or parcel of real estate containing more than four residential units.
(S) "Out-of-state commercial broker" includes any person, partnership, association, limited liability company, limited liability partnership, or corporation that is licensed to do business as a real estate broker in a jurisdiction other than Ohio.
(T) "Out-of-state commercial salesperson" includes any person affiliated with an out-of-state commercial broker who is not licensed as a real estate salesperson in Ohio.
(U) "Exclusive right to sell or lease listing agreement" means an agency agreement between a seller and broker that meets the requirements of section 4735.55 of the Revised Code and does both of the following:
(1) Grants the broker the exclusive right to represent the seller in the sale or lease of the seller's property;
(2) Provides the broker will be compensated if the broker, the seller, or any other person or entity produces a purchaser or tenant in accordance with the terms specified in the listing agreement or if the property is sold or leased during the term of the listing agreement to anyone other than to specifically exempted persons or entities.
(V) "Exclusive agency agreement" means an agency agreement between a seller and broker that meets the requirements of section 4735.55 of the Revised Code and does both of the following:
(1) Grants the broker the exclusive right to represent the seller in the sale or lease of the seller's property;
(2) Provides the broker will be compensated if the broker or any other person or entity produces a purchaser or tenant in accordance with the terms specified in the listing agreement or if the property is sold or leased during the term of the listing agreement, unless the property is sold or leased solely through the efforts of the seller or to the specifically exempted persons or entities.
(W) "Exclusive purchaser agency agreement" means an agency agreement between a purchaser and broker that meets the requirements of section 4735.55 of the Revised Code and does both of the following:
(1) Grants the broker the exclusive right to represent the purchaser in the purchase or lease of property;
(2) Provides the broker will be compensated in accordance with the terms specified in the exclusive agency agreement or if a property is purchased or leased by the purchaser during the term of the agency agreement unless the property is specifically exempted in the agency agreement.
The agreement may authorize the broker to receive compensation from the seller or the seller's agent and may provide that the purchaser is not obligated to compensate the broker if the property is purchased or leased solely through the efforts of the purchaser.
(X) "Seller" means a party in a real estate transaction who is the potential transferor of property. "Seller" includes an owner of property who is seeking to sell the property and a landlord who is seeking to rent or lease property to another person.
(Y) "Resigned" means the license status in which a license has been voluntarily and permanently surrendered to or is otherwise in the possession of the division of real estate and professional licensing, may not be renewed or reactivated in accordance with the requirements specified in this chapter or the rules adopted pursuant to it, and is not associated with a real estate broker.
(Z) "Bona fide" means made in good faith or without purpose of circumventing license law.
(AA) "Associate broker" means an individual licensed as a real estate broker under this chapter who does not function as the principal broker or a management level licensee.
(BB) "Brokerage" means a corporation, partnership, limited partnership, association, limited liability company, limited liability partnership, or sole proprietorship, foreign or domestic, that has been issued a broker's license. "Brokerage" includes the affiliated licensees who have been assigned management duties that include supervision of licensees whose duties may conflict with those of other affiliated licensees.
(CC) "Credit-eligible course" means a credit or noncredit-bearing course that is both of the following:
(1) The course is offered by an institution of higher education.
(2) The course is eligible for academic credit that may be applied toward the requirements for a degree at the institution of higher education.
(DD) "Distance education" means courses required by divisions (B)(6) and (G) of section 4735.07, divisions (F)(6) and (I) of section 4735.09, and division (A) of section 4735.141 of the Revised Code in which instruction is accomplished through use of interactive, electronic media and where the teacher and student are separated by distance or time, or both.
(EE) "Licensee" means any individual licensed as a real estate broker or salesperson by the Ohio real estate commission pursuant to this chapter.
(FF) "Management level licensee" means a licensee who is employed by or affiliated with a real estate broker and who has supervisory responsibility over other licensees employed by or affiliated with that real estate broker.
(GG) "Principal broker" means an individual licensed as a real estate broker under this chapter who oversees and directs the operations of the brokerage.
Sec. 4735.06. (A) Application for a license as a real estate broker shall be made to the superintendent of real estate on forms furnished by the superintendent and filed with the superintendent and shall be signed by the applicant or its members or officers. Each application shall state the name of the person applying and the location of the place of business for which the license is desired, and give such other information as the superintendent requires in the form of application prescribed by the superintendent.
(B)(1) If the applicant is a partnership, limited liability company, limited liability partnership, or association, the names of all the members also shall be stated, and, if the applicant is a corporation, the names of its president and of each of its officers also shall be stated.
The superintendent has the right to reject the application of any partnership, association, limited liability company, limited liability partnership, or corporation if the name proposed to be used by such partnership, association, limited liability company, limited liability partnership, or corporation is likely to mislead the public or if the name is not such as to distinguish it from the name of any existing partnership, association, limited liability company, limited liability partnership, or corporation licensed under this chapter, unless there is filed with the application the written consent of such existing partnership, association, limited liability company, limited liability partnership, or corporation, executed by a duly authorized representative of it, permitting the use of the name of such existing partnership, association, limited liability company, limited liability partnership, or corporation.
(B)(2)
The superintendent shall approve the use of a trade name by a
brokerage, if
the name meets both of the following criteria:
(a) The proposed name is not the same as or is clearly distinguishable from a name registered with the division of real estate and professional licensing by another existing brokerage. If the superintendent determines that the proposed name is not clearly distinguishable from any other existing brokerage, the superintendent may approve the use of the trade name if there is filed with the superintendent the written consent of the existing brokerage with the same or similar name.
(b) The name is not misleading or likely to mislead the public.
(3) The superintendent may approve the use of more than one trade name for a brokerage.
(4) When a brokerage has received the approval of the superintendent to conduct business under one or more trade names, those trade names shall be the only identifying names used by the brokerage in all advertising.
(C) A fee of one hundred dollars shall accompany the application for a real estate broker's license. The initial licensing period commences at the time the license is issued and ends on the applicant's first birthday thereafter. However, if the applicant was an inactive or active salesperson immediately preceding application for a broker's license, then the initial licensing period shall commence at the time the broker's license is issued and ends on the date the licensee's continuing education is due as set when the applicant was a salesperson. The application fee shall be nonrefundable. A fee of one hundred dollars shall be charged by the superintendent for each successive application made by an applicant. In the case of issuance of a three-year license, upon passing the examination, or upon waiver of the examination requirement, if the superintendent determines it is necessary, the applicant shall submit an additional fee determined by the superintendent based upon the number of years remaining in a real estate salesperson's licensing period.
(C)
(D)
One
dollar of each application fee for a real estate
broker's license shall be credited to the real estate education
and research fund, which is hereby created in the state
treasury. The Ohio real estate commission may use the fund in
discharging the duties prescribed in divisions (E), (F), (G), and
(H) of section 4735.03 of the Revised Code and shall use it in
the advancement of education and research in real estate at any
institution of higher education in the state, or in contracting
with any such institution or a trade organization for
a particular research or educational project in the field of real
estate, or in advancing loans, not exceeding two thousand dollars,
to applicants for salesperson licenses, to defray the costs
of satisfying the educational requirements of division (F) of
section 4735.09 of the Revised Code. Such loans shall be made
according to rules
established by the commission under the procedures
of Chapter 119. of the Revised Code, and they shall be
repaid to the fund within three years of the time they are made.
No more than twenty-five thousand dollars shall be lent from
the fund in any one fiscal year.
The governor may appoint a representative from the executive branch to be a member ex officio of the commission for the purpose of advising on research requests or educational projects. The commission shall report to the general assembly on the third Tuesday after the third Monday in January of each year setting forth the total amount contained in the fund and the amount of each research grant that it has authorized and the amount of each research grant requested. A copy of all research reports shall be submitted to the state library of Ohio and the library of the legislative service commission.
(D)
(E)
If
the superintendent, with the consent of the commission,
enters into an agreement with a national testing service
to administer the real estate broker's examination, pursuant
to division (A) of section 4735.07 of the Revised Code, the
superintendent may require an applicant to pay the testing service's
examination fee directly to the testing service. If the
superintendent requires the payment of the examination fee directly
to the testing service, each applicant shall submit to the
superintendent a processing fee in an amount determined by the
Ohio real estate commission pursuant to division (A)(2) of section
4735.10 of the Revised Code.
Sec. 4735.07. (A) The superintendent of real estate, with the consent of the Ohio real estate commission, may enter into agreements with recognized national testing services to administer the real estate broker's examination under the superintendent's supervision and control, consistent with the requirements of this chapter as to the contents of such examination.
(B) No applicant for a real estate broker's license shall take the broker's examination who has not established to the satisfaction of the superintendent that the applicant:
(1) Is honest, truthful, and of good reputation;
(2)(a) Has not been convicted of a felony or crime of moral turpitude, or if the applicant has been so convicted, the superintendent has disregarded the conviction because the applicant has proven to the superintendent, by a preponderance of the evidence, that the applicant's activities and employment record since the conviction show that the applicant is honest, truthful, and of good reputation, and there is no basis in fact for believing that the applicant again will violate the laws involved;
(b) Has not been finally adjudged by a court to have violated any municipal, state, or federal civil rights laws relevant to the protection of purchasers or sellers of real estate or, if the applicant has been so adjudged, at least two years have passed since the court decision and the superintendent has disregarded the adjudication because the applicant has proven, by a preponderance of the evidence, that the applicant's activities and employment record since the adjudication show that the applicant is honest, truthful, and of good reputation, and there is no basis in fact for believing that the applicant will again violate the laws involved.
(3) Has not, during any period in which the applicant was licensed under this chapter, violated any provision of, or any rule adopted pursuant to, this chapter, or, if the applicant has violated any such provision or rule, has established to the satisfaction of the superintendent that the applicant will not again violate such provision or rule;
(4) Is at least eighteen years of age;
(5) Has been a licensed real estate broker or salesperson for at least two years; during at least two of the five years preceding the person's application, has worked as a licensed real estate broker or salesperson for an average of at least thirty hours per week; and has completed one of the following:
(a) At least twenty real estate transactions, in which property was sold for another by the applicant while acting in the capacity of a real estate broker or salesperson;
(b) Such equivalent experience as is defined by rules adopted by the commission.
(6)(a) If licensed as a real estate salesperson prior to August 1, 2001, successfully has completed at an institution of higher education all of the following credit-eligible courses by either classroom instruction or distance education:
(i)
Thirty hours of classroom
instruction in real estate practice;
(ii)
Thirty hours of classroom
instruction that includes the subjects
of Ohio real estate law, municipal, state, and federal civil rights
law, new case law on housing discrimination, desegregation issues,
and methods of eliminating the effects of prior discrimination. If
feasible, the classroom
instruction in Ohio real estate law
shall be taught by a member of the faculty of an accredited law
school. If feasible, the classroom
instruction in municipal, state, and
federal civil rights law, new case law on housing discrimination,
desegregation issues, and methods of eliminating the effects of prior
discrimination shall be taught by a staff member of the Ohio civil
rights commission who is knowledgeable with respect to those
subjects. The requirements of this division do not apply to an
applicant who is admitted to practice before the supreme court.
(iii)
Thirty hours of classroom
instruction in real estate appraisal;
(iv)
Thirty hours of classroom
instruction
in real estate finance;
(v) Three quarter hours, or its equivalent in semester hours, in financial management;
(vi) Three quarter hours, or its equivalent in semester hours, in human resource or personnel management;
(vii) Three quarter hours, or its equivalent in semester hours, in applied business economics;
(viii) Three quarter hours, or its equivalent in semester hours, in business law.
(b) If licensed as a real estate salesperson on or after August 1, 2001, successfully has completed at an institution of higher education all of the following credit-eligible courses by either classroom instruction or distance education:
(i)
Forty hours of classroom
instruction
in real estate practice;
(ii)
Forty hours of classroom
instruction that includes the subjects
of Ohio real estate law, municipal, state, and federal civil rights
law, new case law on housing discrimination, desegregation issues,
and methods of eliminating the effects of prior discrimination. If
feasible, the classroom
instruction in Ohio real estate law
shall be taught by a member of the faculty of an accredited law
school. If feasible, the classroom
instruction in municipal, state, and
federal civil rights law, new case law on housing discrimination,
desegregation issues, and methods of eliminating the effects of prior
discrimination shall be taught by a staff member of the Ohio civil
rights commission who is knowledgeable with respect to those
subjects. The requirements of this division do not apply to an
applicant who is admitted to practice before the supreme court.
(iii)
Twenty hours of classroom
instruction in real estate appraisal;
(iv)
Twenty hours of classroom
instruction in real estate finance;
(v) The training in the amount of hours specified under divisions (B)(6)(a)(v), (vi), (vii), and (viii) of this section.
(c) Division (B)(6)(a) or (b) of this section does not apply to any applicant who holds a valid real estate salesperson's license issued prior to January 2, 1972. Divisions (B)(6)(a)(v), (vi), (vii), and (viii) or division (B)(6)(b)(v) of this section do not apply to any applicant who holds a valid real estate salesperson's license issued prior to January 3, 1984.
(d) Divisions (B)(6)(a)(iii) and (B)(6)(b)(iii) of this section do not apply to any new applicant who holds a valid Ohio real estate appraiser license or certificate issued prior to the date of application for a real estate broker's license.
(e) Successful completion of the instruction required by division (B)(6)(a) or (b) of this section shall be determined by the law in effect on the date the instruction was completed.
(7) If licensed as a real estate salesperson on or after January 3, 1984, satisfactorily has completed a minimum of two years of post-secondary education, or its equivalent in semester or quarter hours, at an institution of higher education, and has fulfilled the requirements of division (B)(6)(a) or (b) of this section. The requirements of division (B)(6)(a) or (b) of this section may be included in the two years of post-secondary education, or its equivalent in semester or quarter hours, that is required by this division. The post-secondary education requirement may be satisfied by completing the credit-eligible courses using either classroom instruction or distance education. Successful completion of any course required by this section shall be determined by the law in effect on the date the course was completed.
(C) Each applicant for a broker's license shall be examined in the principles of real estate practice, Ohio real estate law, and financing and appraisal, and as to the duties of real estate brokers and real estate salespersons, the applicant's knowledge of real estate transactions and instruments relating to them, and the canons of business ethics pertaining to them. The commission from time to time shall promulgate such canons and cause them to be published in printed form.
(D) Examinations shall be administered with reasonable accommodations in accordance with the requirements of the "Americans with Disabilities Act of 1990," 104 Stat. 327, 42 U.S.C. 12101. The contents of an examination shall be consistent with the requirements of division (B)(6) of this section and with the other specific requirements of this section. An applicant who has completed the requirements of division (B)(6) of this section at the time of application shall be examined no later than twelve months after the applicant is notified of admission to the examination.
(E) The superintendent may waive one or more of the requirements of this section in the case of an application from a nonresident real estate broker pursuant to a reciprocity agreement with the licensing authority of the state from which the nonresident applicant holds a valid real estate broker license.
(F) There shall be no limit placed on the number of times an applicant may retake the examination.
(G)(1)
Not earlier than the date of issue of a real estate broker's license
to a licensee, but not later than twelve months after the date of
issue of a real estate broker's license to a licensee, the licensee
shall submit proof satisfactory to the superintendent, on forms made
available by the superintendent, of the completion of ten hours of
classroom
instruction
that shall be completed in schools, seminars, and educational
institutions
that are approved by the commission. Approval of the curriculum and
providers shall be granted according to rules adopted
pursuant to section 4735.10 of the Revised Code
and may be taken through classroom instruction or distance education.
If the required proof of completion is not submitted to the superintendent within twelve months of the date a license is issued under this section, the license of the real estate broker is suspended automatically without the taking of any action by the superintendent. The broker's license shall not be reactivated by the superintendent until it is established, to the satisfaction of the superintendent, that the requirements of this division have been met and that the licensee is in compliance with this chapter. A licensee's license is revoked automatically without the taking of any action by the superintendent if the licensee fails to submit proof of completion of the education requirements specified under division (G)(1) of this section within twelve months of the date the license is suspended.
(2) If the license of a real estate broker is suspended pursuant to division (G)(1) of this section, the license of a real estate salesperson associated with that broker correspondingly is suspended pursuant to division (H) of section 4735.20 of the Revised Code. However, the suspended license of the associated real estate salesperson shall be reactivated and no fee shall be charged or collected for that reactivation if all of the following occur:
(a) That broker subsequently submits satisfactory proof to the superintendent that the broker has complied with the requirements of division (G)(1) of this section and requests that the broker's license as a real estate broker be reactivated;
(b) The superintendent then reactivates the broker's license as a real estate broker;
(c) The associated real estate salesperson intends to continue to be associated with that broker and otherwise is in compliance with this chapter.
Sec. 4735.081. (A) Each brokerage shall designate at least one affiliated broker to act as the principal broker of the brokerage. Any affiliated broker not so designated shall be an associate broker or management level licensee for that brokerage.
(B) A brokerage shall report any change in designation as a principal broker to the superintendent not later than fifteen days after the change occurs.
(C) Every principal broker of a brokerage shall do all of the following:
(1) Oversee and direct the operations of the brokerage;
(2) Comply with the office requirements set forth in division (A) of section 4735.13 and division (A) of section 4735.16 of the Revised Code;
(3) Display, as required by division (D) of section 4735.16 of the Revised Code and division rules, the fair housing statement in the brokerage offices and on the pamphlets required by that section and section 4735.03 of the Revised Code and the rules adopted by the Ohio real estate commission;
(4) Renew the licenses of the brokerage and any branch offices as required by section 4735.14 of the Revised Code and pay the fee required under division (B)(2) of section 4735.15 of the Revised Code and commission rules;
(5) Maintain the licenses of the brokerage and affiliated salespersons and brokers as required by section 4735.13 of the Revised Code;
(6) Return the license of terminated salespersons and brokers as required by division (B) of section 4735.13 of the Revised Code;
(7) Comply with the trust or special bank account requirements set forth in divisions (A)(26) and (27) of section 4735.18 and section 4735.24 of the Revised Code and commission rules;
(8) Maintain complete and accurate trust account records and transaction records as required by division (A)(24) of section 4735.18 of the Revised Code and commission rules;
(9) Develop and maintain a written company policy on agency relationships as required by section 4735.54 of the Revised Code and rules adopted by the superintendent of real estate and professional licensing;
(10) Develop a written brokerage policy on agency required by section 4735.56 of the Revised Code;
(11) Pay affiliate licensees as required by division (A)(31) of section 4735.18 of the Revised Code;
(12) Establish practices and procedures to assure that only affiliated licensees perform and are compensated for performing the licensed activity as required by division (A)(34) of sections 4735.18 and 4735.20 of the Revised Code;
(13) Establish practices and procedures to assure compliance with the advertising requirements set forth in section 4735.16 of the Revised Code and commission rules;
(14) Generally oversee the licensed activity of affiliated licensees and to assure that affiliated licensees are providing real estate services within their area of competency or are working with another affiliated licensee who possesses such a competency.
(D) The principal broker or brokers of a brokerage may assign to a management level licensee any of the duties described in division (C) of this section or in commission rules.
(E) The superintendent may permit a broker to be licensed with and act as the principal broker for more than one brokerage.
(F) Nothing in this section shall be considered prima facie evidence of whether an affiliated licensee is an independent contractor or an employee of the brokerage.
Sec. 4735.09. (A) Application for a license as a real estate salesperson shall be made to the superintendent of real estate on forms furnished by the superintendent and signed by the applicant. The application shall be in the form prescribed by the superintendent and shall contain such information as is required by this chapter and the rules of the Ohio real estate commission. The application shall be accompanied by the recommendation of the real estate broker with whom the applicant is associated or with whom the applicant intends to be associated, certifying that the applicant is honest, truthful, and of good reputation, has not been convicted of a felony or a crime involving moral turpitude, and has not been finally adjudged by a court to have violated any municipal, state, or federal civil rights laws relevant to the protection of purchasers or sellers of real estate, which conviction or adjudication the applicant has not disclosed to the superintendent, and recommending that the applicant be admitted to the real estate salesperson examination.
(B) A fee of sixty dollars shall accompany the application, which fee includes the fee for the initial year of the licensing period, if a license is issued. The initial year of the licensing period commences at the time the license is issued and ends on the applicant's first birthday thereafter. The application fee shall be nonrefundable. A fee of sixty dollars shall be charged by the superintendent for each successive application made by the applicant. One dollar of each application fee shall be credited to the real estate education and research fund.
(C) There shall be no limit placed on the number of times an applicant may retake the examination.
(D) The superintendent, with the consent of the commission, may enter into an agreement with a recognized national testing service to administer the real estate salesperson's examination under the superintendent's supervision and control, consistent with the requirements of this chapter as to the contents of the examination.
If the superintendent, with the consent of the commission, enters into an agreement with a national testing service to administer the real estate salesperson's examination, the superintendent may require an applicant to pay the testing service's examination fee directly to the testing service. If the superintendent requires the payment of the examination fee directly to the testing service, each applicant shall submit to the superintendent a processing fee in an amount determined by the Ohio real estate commission pursuant to division (A)(1) of section 4735.10 of the Revised Code.
(E) The superintendent shall issue a real estate salesperson's license when satisfied that the applicant has received a passing score on each portion of the salesperson's examination as determined by rule by the real estate commission, except that the superintendent may waive one or more of the requirements of this section in the case of an applicant who is a licensed real estate salesperson in another state pursuant to a reciprocity agreement with the licensing authority of the state from which the applicant holds a valid real estate salesperson's license.
(F) No applicant for a salesperson's license shall take the salesperson's examination who has not established to the satisfaction of the superintendent that the applicant:
(1) Is honest, truthful, and of good reputation;
(2)(a) Has not been convicted of a felony or crime of moral turpitude or, if the applicant has been so convicted, the superintendent has disregarded the conviction because the applicant has proven to the superintendent, by a preponderance of the evidence, that the applicant's activities and employment record since the conviction show that the applicant is honest, truthful, and of good reputation, and there is no basis in fact for believing that the applicant again will violate the laws involved;
(b) Has not been finally adjudged by a court to have violated any municipal, state, or federal civil rights laws relevant to the protection of purchasers or sellers of real estate or, if the applicant has been so adjudged, at least two years have passed since the court decision and the superintendent has disregarded the adjudication because the applicant has proven, by a preponderance of the evidence, that the applicant is honest, truthful, and of good reputation, and there is no basis in fact for believing that the applicant again will violate the laws involved.
(3) Has not, during any period in which the applicant was licensed under this chapter, violated any provision of, or any rule adopted pursuant to this chapter, or, if the applicant has violated such provision or rule, has established to the satisfaction of the superintendent that the applicant will not again violate such provision or rule;
(4) Is at least eighteen years of age;
(5) If born after the year 1950, has a high school diploma or its equivalent as recognized by the state department of education;
(6) Has successfully completed at an institution of higher education all of the following credit-eligible courses by either classroom instruction or distance education:
(a)
Forty hours of classroom
instruction in real estate practice;
(b)
Forty hours of classroom
instruction that includes the subjects
of Ohio real estate law, municipal, state, and federal civil rights
law, new case law on housing discrimination, desegregation issues,
and methods of eliminating the effects of prior discrimination. If
feasible, the classroom
instruction in Ohio real estate law
shall be taught by a member of the faculty of an accredited law
school. If feasible, the classroom
instruction in municipal, state, and
federal civil rights law, new case law on housing discrimination,
desegregation issues, and methods of eliminating the effects of prior
discrimination shall be taught by a staff member of the Ohio civil
rights commission who is knowledgeable with respect to those
subjects. The requirements of this division do not apply to an
applicant who is admitted to practice before the supreme court.
(c)
Twenty hours of classroom
instruction in real estate appraisal;
(d)
Twenty hours of classroom
instruction
in real estate finance.
(G)(1) Successful completion of the instruction required by division (F)(6) of this section shall be determined by the law in effect on the date the instruction was completed.
(2) Division (F)(6)(c) of this section does not apply to any new applicant who holds a valid Ohio real estate appraiser license or certificate issued prior to the date of application for a real estate salesperson's license.
(H)
Any person who has not been licensed as a real estate salesperson
or broker within a four-year period immediately preceding
the person's current application for the salesperson's examination
shall have successfully completed the prelicensure classroom
instruction
required by division (F)(6) of this section
within a ten-year period immediately preceding the person's
current application for the salesperson's examination.
(I)
Not earlier than the date of issue of a real estate salesperson's
license to a licensee, but not later than twelve months
after the date of issue of a real estate salesperson license
to a licensee, the licensee shall submit proof satisfactory
to the superintendent, on forms made available by the
superintendent, of the completion of ten
twenty
hours
of classroom
instruction
that shall be completed in schools, seminars,
and educational institutions approved by the commission.
The
instruction shall include, but is not limited to,
current practices relating to commercial real estate, property
management, short sales, and land contracts; contract law;
federal and state programs; economic conditions; and fiduciary
responsibility. Approval
of the curriculum and providers
shall be granted according to rules adopted pursuant to
section 4735.10 of the Revised Code
and may be taken through classroom
instruction or distance education.
If proof of completion of the required instruction is not submitted within twelve months of the date a license is issued under this section, the licensee's license is suspended automatically without the taking of any action by the superintendent. The superintendent immediately shall notify the broker with whom such salesperson is associated of the suspension of the salesperson's license. A salesperson whose license has been suspended under this division shall have twelve months after the date of the suspension of the salesperson's license to submit proof of successful completion of the instruction required under this division. No such license shall be reactivated by the superintendent until it is established, to the satisfaction of the superintendent, that the requirements of this division have been met and that the licensee is in compliance with this chapter. A licensee's license is revoked automatically without the taking of any action by the superintendent when the licensee fails to submit the required proof of completion of the education requirements under division (I) of this section within twelve months of the date the license is suspended.
(J) Examinations shall be administered with reasonable accommodations in accordance with the requirements of the "Americans with Disabilities Act of 1990," 104 Stat. 327, 42 U.S.C. 12189. The contents of an examination shall be consistent with the classroom instructional requirements of division (F)(6) of this section. An applicant who has completed the classroom instructional requirements of division (F)(6) of this section at the time of application shall be examined no later than twelve months after the applicant is notified of the applicant's admission to the examination.
Sec. 4735.091. A real estate broker, real estate salesperson, foreign real estate dealer, and foreign real estate salesperson may be associated with a brokerage as either an employee or an independent contractor.
Sec. 4735.10. (A)(1) The Ohio real estate commission may adopt reasonable rules in accordance with Chapter 119. of the Revised Code, necessary for implementing the provisions of this chapter relating, but not limited to, the following:
(a) The form and manner of filing applications for licensure;
(b) Times and form of examination for license;
(c) Placing an existing broker's license on deposit or a salesperson's license on an inactive status for an indefinite period;
(d) Specifying the process by which a licensee may resign the licensee's license;
(e) Defining any additional license status that the commission determines is necessary and that is not otherwise defined in this chapter and establishing the process by which a licensee places the licensee's license in a status defined by the commission in the rules the commission adopts;
(f) Clarification of the activities that require a license under this chapter;
(g) Permitting a broker to act as principal broker for more than one brokerage.
(2) The commission shall adopt reasonable rules in accordance with Chapter 119. of the Revised Code, for implementing the provisions of this chapter relating to the following:
(a) The issuance, renewal, suspension, and revocation of licenses, other sanctions that may be imposed for violations of this chapter, the conduct of hearings related to these actions, and the process of reactivating a license;
(b) A three-year license and a three-year license renewal system;
(c)
Standards for the approval of the ten-hour
postlicensure
courses as required by division (G) of section 4735.07
and division (I) of section 4735.09 of the Revised Code, courses
of study required for licenses, courses offered in preparation
for license examinations, or courses required as continuing
education for licenses.
(d) Guidelines to ensure that continuing education classes are open to all persons licensed under this chapter. The rules shall specify that an organization that sponsors a continuing education class may offer its members a reasonable reduction in the fees charged for the class.
(e) Requirements for trust accounts and property management accounts. The rules shall specify that:
(i) Brokerages engaged in the management of property for another may, pursuant to a written contract with the property owner, exercise signatory authority for withdrawals from property management accounts maintained in the name of the property owner. The exercise of authority for withdrawals does not constitute a violation of any provision of division (A) of section 4735.18 of the Revised Code.
(ii) The interest earned on property management trust accounts maintained in the name of the property owner or the broker shall be payable to the property owner unless otherwise specified in a written contract.
(f) Notice of renewal forms and filing deadlines;
(g) Special assessments under division (A) of section 4735.12 of the Revised Code.
(B) The commission may adopt rules in accordance with Chapter 119. of the Revised Code establishing standards and guidelines with which the superintendent of real estate shall comply in the exercise of the following powers:
(1) Appointment and recommendation of ancillary trustees under section 4735.05 of the Revised Code;
(2)
Rejection of names proposed to be used by partnerships,
associations, limited liability companies, limited liability
partnerships, and corporations, under division (A)
(B)
of
section 4735.06 of the Revised Code,
including procedures for the
application and approval of more than one trade name for a brokerage;
(3) Acceptance and rejection of applications to take the broker and salesperson examinations and licensure, with appropriate waivers pursuant to division (E) of section 4735.07 and section 4735.09 of the Revised Code;
(4) Approval of applications of brokers to place their licenses in an inactive status and to become salespersons under section 4735.13 of the Revised Code;
(5) Appointment of hearing examiners under section 119.09 of the Revised Code;
(6) Acceptance and rejection of applications to take the foreign real estate dealer and salesperson examinations and licensure, with waiver of examination, under sections 4735.27 and 4735.28 of the Revised Code;
(7) Qualification of foreign real estate under section 4735.25 of the Revised Code.
If at any time there is no rule in effect establishing a guideline or standard required by this division, the superintendent may adopt a rule in accordance with Chapter 119. of the Revised Code for such purpose.
(C) The commission or superintendent may hear testimony in matters relating to the duties imposed upon them, and the president of the commission and superintendent may administer oaths. The commission or superintendent may require other proof of the honesty, truthfulness, and good reputation of any person named in an application for a real estate broker's or real estate salesperson's license before admitting the applicant to the examination or issuing a license.
Sec. 4735.141. (A) Except as otherwise provided in this division and in section 4735.13 of the Revised Code and except for a licensee who has placed the licensee's license in resigned status pursuant to section 4735.142 of the Revised Code, each person licensed under section 4735.07 or 4735.09 of the Revised Code shall submit proof satisfactory to the superintendent of real estate that the licensee has satisfactorily completed thirty hours of continuing education, as prescribed by the Ohio real estate commission pursuant to section 4735.10 of the Revised Code, on or before the licensee's birthday occurring three years after the licensee's date of initial licensure, and on or before the licensee's birthday every three years thereafter. If the person is licensed as a broker or broker on deposit, or acts as a management level licensee, the continuing education shall include a three-hour course on the duties of a principal broker and other issues involved in operating a real estate brokerage. The continuing education may be completed by either classroom instruction or distance education.
Persons licensed as real estate salespersons who subsequently become licensed real estate brokers shall continue to submit proof of continuing education in accordance with the time period established in this section.
The requirements of this section shall not apply to any disabled licensee as provided in division (E) of this section.
Each
licensee who is seventy years of age or older, within a
continuing education reporting period, shall submit proof
satisfactory to the superintendent of
real estate that the licensee has
satisfactorily completed
a
both
of the following:
(1)
A total
of nine
classroom
hours of
continuing education, including
instruction in Ohio real estate law; recently
enacted state and federal laws affecting the real estate
industry; municipal, state, and federal civil rights law; and
canons of ethics for the real
estate industry as adopted by the
commission;
(2) If licensed as a broker, broker on deposit, or acting as a management level licensee, a three-hour continuing education course on the duties of a principal broker and other issues involved in operating a real estate brokerage.
The continuing education may be completed by either classroom instruction or distance education. The required proof of completion shall be submitted on or before the licensee's birthday that falls in the third year of that continuing education reporting period. A licensee who is seventy years of age or older whose license is in an inactive status is exempt from the continuing education requirements specified in this section. The commission shall adopt reasonable rules in accordance with Chapter 119. of the Revised Code to carry out the purposes of this paragraph.
(B) The continuing education requirements of this section shall be completed in schools, seminars, and educational institutions approved by the commission. Such approval shall be given according to rules established by the commission under the procedures of Chapter 119. of the Revised Code, and shall not be limited to institutions providing two-year or four-year degrees. Each school, seminar, or educational institution approved under this division shall be open to all licensees on an equal basis.
(C) If the requirements of this section are not met by a licensee within the period specified, the licensee's license shall be suspended automatically without the taking of any action by the superintendent. The superintendent shall notify the licensee of the license suspension, and such notification shall be sent by regular mail to the personal residence address of the licensee that is on file with the division. Any license so suspended shall remain suspended until it is reactivated by the superintendent. No such license shall be reactivated until it is established, to the satisfaction of the superintendent, that the requirements of this section have been met. If the requirements of this section are not met within twelve months from the date the license was suspended, the license shall be revoked automatically without the taking of any action by the superintendent.
(D) If the license of a real estate broker is suspended pursuant to division (C) of this section, the license of a real estate salesperson associated with that broker correspondingly is suspended pursuant to division (H) of section 4735.20 of the Revised Code. A sole broker shall notify affiliated salespersons of the suspension in writing within three days of receiving the notice required by division (C) of this section.
(1) The suspended license of the associated real estate salesperson shall be reactivated and no fee shall be charged or collected for that reactivation if that broker subsequently submits proof to the superintendent that the broker has complied with the requirements of this section and requests that the broker's license as a real estate broker be reactivated, and the superintendent then reactivates the broker's license as a real estate broker.
(2) If the real estate salesperson submits an application to leave the association of the suspended broker in order to associate with a different broker, the suspended license of the associated real estate salesperson shall be reactivated and no fee shall be charged or collected for that reactivation. The superintendent may process the application regardless of whether the licensee's license is returned to the superintendent.
Any person whose license is reactivated pursuant to this division shall comply with the requirements of this section and otherwise be in compliance with this chapter.
(E) Any licensee who is a disabled licensee at any time during the last three months of the third year of the licensee's continuing education reporting period may receive an extension of time as deemed appropriate by the superintendent to submit proof to the superintendent that the licensee has satisfactorily completed the required thirty hours of continuing education. To receive an extension of time, the licensee shall submit a request to the division of real estate for the extension and proof satisfactory to the commission that the licensee was a disabled licensee at some time during the last three months of the three-year reporting period. The proof shall include, but is not limited to, a signed statement by the licensee's attending physician describing the disability, certifying that the licensee's disability is of such a nature as to prevent the licensee from attending any instruction lasting at least three hours in duration, and stating the expected duration of the disability. The licensee shall request the extension and provide the physician's statement to the division no later than one month prior to the end of the licensee's three-year continuing education reporting period, unless the disability did not arise until the last month of the three-year reporting period, in which event the licensee shall request the extension and provide the physician's statement as soon as practical after the occurrence of the disability. A licensee granted an extension pursuant to this division who is no longer a disabled licensee and who submits proof of completion of the continuing education during the extension period, shall submit, for future continuing education reporting periods, proof of completion of the continuing education requirements according to the schedule established in division (A) of this section.
(F) The superintendent shall not renew a license if the licensee fails to comply with this section, and the licensee shall be required to pay the penalty fee provided in section 4735.14 of the Revised Code.
(G) A licensee shall submit proof of completion of the required continuing education with the licensee's notice of renewal. The proof shall be submitted in the manner provided by the superintendent.
Sec. 4735.18. (A) Subject to section 4735.32 of the Revised Code, the superintendent of real estate, upon the superintendent's own motion, may investigate the conduct of any licensee. Subject to section 4735.32 of the Revised Code, the Ohio real estate commission shall impose disciplinary sanctions upon any licensee who, whether or not acting in the licensee's capacity as a real estate broker or salesperson, or in handling the licensee's own property, is found to have been convicted of a felony or a crime of moral turpitude, and may impose disciplinary sanctions upon any licensee who, in the licensee's capacity as a real estate broker or salesperson, or in handling the licensee's own property, is found guilty of:
(1) Knowingly making any misrepresentation;
(2) Making any false promises with intent to influence, persuade, or induce;
(3) A continued course of misrepresentation or the making of false promises through agents, salespersons, advertising, or otherwise;
(4) Acting for more than one party in a transaction except as permitted by and in compliance with section 4735.71 of the Revised Code;
(5) Failure within a reasonable time to account for or to remit any money coming into the licensee's possession which belongs to others;
(6) Dishonest or illegal dealing, gross negligence, incompetency, or misconduct;
(7)(a) By final adjudication by a court, a violation of any municipal or federal civil rights law relevant to the protection of purchasers or sellers of real estate or, by final adjudication by a court, any unlawful discriminatory practice pertaining to the purchase or sale of real estate prohibited by Chapter 4112. of the Revised Code, provided that such violation arose out of a situation wherein parties were engaged in bona fide efforts to purchase, sell, or lease real estate, in the licensee's practice as a licensed real estate broker or salesperson;
(b) A second or subsequent violation of any unlawful discriminatory practice pertaining to the purchase or sale of real estate prohibited by Chapter 4112. of the Revised Code or any second or subsequent violation of municipal or federal civil rights laws relevant to purchasing or selling real estate whether or not there has been a final adjudication by a court, provided that such violation arose out of a situation wherein parties were engaged in bona fide efforts to purchase, sell, or lease real estate. For any second offense under this division, the commission shall suspend for a minimum of two months or revoke the license of the broker or salesperson. For any subsequent offense, the commission shall revoke the license of the broker or salesperson.
(8) Procuring a license under this chapter, for the licensee or any salesperson by fraud, misrepresentation, or deceit;
(9) Having violated or failed to comply with any provision of sections 4735.51 to 4735.74 of the Revised Code or having willfully disregarded or violated any other provisions of this chapter;
(10) As a real estate broker, having demanded, without reasonable cause, other than from a broker licensed under this chapter, a commission to which the licensee is not entitled, or, as a real estate salesperson, having demanded, without reasonable cause, a commission to which the licensee is not entitled;
(11) Except as permitted under section 4735.20 of the Revised Code, having paid commissions or fees to, or divided commissions or fees with, anyone not licensed as a real estate broker or salesperson under this chapter or anyone not operating as an out-of-state commercial real estate broker or salesperson under section 4735.022 of the Revised Code;
(12) Having falsely represented membership in any real estate professional association of which the licensee is not a member;
(13) Having accepted, given, or charged any undisclosed commission, rebate, or direct profit on expenditures made for a principal;
(14) Having offered anything of value other than the consideration recited in the sales contract as an inducement to a person to enter into a contract for the purchase or sale of real estate or having offered real estate or the improvements on real estate as a prize in a lottery or scheme of chance;
(15) Having acted in the dual capacity of real estate broker and undisclosed principal, or real estate salesperson and undisclosed principal, in any transaction;
(16) Having guaranteed, authorized, or permitted any person to guarantee future profits which may result from the resale of real property;
(17) Having advertised or placed a sign on any property offering it for sale or for rent without the consent of the owner or the owner's authorized agent;
(18) Having induced any party to a contract of sale or lease to break such contract for the purpose of substituting in lieu of it a new contract with another principal;
(19) Having negotiated the sale, exchange, or lease of any real property directly with a seller, purchaser, lessor, or tenant knowing that such seller, purchaser, lessor, or tenant is represented by another broker under a written exclusive agency agreement, exclusive right to sell or lease listing agreement, or exclusive purchaser agency agreement with respect to such property except as provided for in section 4735.75 of the Revised Code;
(20) Having offered real property for sale or for lease without the knowledge and consent of the owner or the owner's authorized agent, or on any terms other than those authorized by the owner or the owner's authorized agent;
(21) Having published advertising, whether printed, radio, display, or of any other nature, which was misleading or inaccurate in any material particular, or in any way having misrepresented any properties, terms, values, policies, or services of the business conducted;
(22) Having knowingly withheld from or inserted in any statement of account or invoice any statement that made it inaccurate in any material particular;
(23) Having published or circulated unjustified or unwarranted threats of legal proceedings which tended to or had the effect of harassing competitors or intimidating their customers;
(24) Having failed to keep complete and accurate records of all transactions for a period of three years from the date of the transaction, such records to include copies of listing forms, earnest money receipts, offers to purchase and acceptances of them, records of receipts and disbursements of all funds received by the licensee as broker and incident to the licensee's transactions as such, and records required pursuant to divisions (C)(4) and (5) of section 4735.20 of the Revised Code, and any other instruments or papers related to the performance of any of the acts set forth in the definition of a real estate broker;
(25) Failure of a real estate broker or salesperson to furnish all parties involved in a real estate transaction true copies of all listings and other agreements to which they are a party, at the time each party signs them;
(26) Failure to maintain at all times a special or trust bank account in a depository located in this state. The account shall be noninterest-bearing, separate and distinct from any personal or other account of the broker, and, except as provided in division (A)(27) of this section, shall be used for the deposit and maintenance of all escrow funds, security deposits, and other moneys received by the broker in a fiduciary capacity. The name, account number, if any, and location of the depository wherein such special or trust account is maintained shall be submitted in writing to the superintendent. Checks drawn on such special or trust bank accounts are deemed to meet the conditions imposed by section 1349.21 of the Revised Code. Funds deposited in the trust or special account in connection with a purchase agreement shall be maintained in accordance with section 4735.24 of the Revised Code.
(27) Failure to maintain at all times a special or trust bank account in a depository in this state, to be used exclusively for the deposit and maintenance of all rents, security deposits, escrow funds, and other moneys received by the broker in a fiduciary capacity in the course of managing real property. This account shall be separate and distinct from any other account maintained by the broker. The name, account number, and location of the depository shall be submitted in writing to the superintendent. This account may earn interest, which shall be paid to the property owners on a pro rata basis.
Division (A)(27) of this section does not apply to brokers who are not engaged in the management of real property on behalf of real property owners.
(28) Having failed to put definite expiration dates in all written agency agreements to which the broker is a party;
(29) Having an unsatisfied final judgment or lien in any court of record against the licensee arising out of the licensee's conduct as a licensed broker or salesperson;
(30) Failing to render promptly upon demand a full and complete statement of the expenditures by the broker or salesperson of funds advanced by or on behalf of a party to a real estate transaction to the broker or salesperson for the purpose of performing duties as a licensee under this chapter in conjunction with the real estate transaction;
(31) Failure within a reasonable time, after the receipt of the commission by the broker, to render an accounting to and pay a real estate salesperson the salesperson's earned share of it;
(32) Performing any service for another constituting the practice of law, as determined by any court of law;
(33) Having been adjudicated incompetent for the purpose of holding the license by a court, as provided in section 5122.301 of the Revised Code. A license revoked or suspended under this division shall be reactivated upon proof to the commission of the removal of the disability.
(34) Having authorized or permitted a person to act as an agent in the capacity of a real estate broker, or a real estate salesperson, who was not then licensed as a real estate broker or real estate salesperson under this chapter or who was not then operating as an out-of-state commercial real estate broker or salesperson under section 4735.022 of the Revised Code;
(35) Having knowingly inserted or participated in inserting any materially inaccurate term in a document, including naming a false consideration;
(36) Having failed to inform the licensee's client of the existence of an offer or counteroffer or having failed to present an offer or counteroffer in a timely manner, unless otherwise instructed by the client, provided the instruction of the client does not conflict with any state or federal law;
(37) Having failed to comply with section 4735.24 of the Revised Code;
(38) Having acted as a broker without authority, impeded the ability of a principal broker to perform any of the duties described in section 4735.081 of the Revised Code, or impeded the ability a management level licensee to perform the licensee's duties.
(B) Whenever the commission, pursuant to section 4735.051 of the Revised Code, imposes disciplinary sanctions for any violation of this section, the commission also may impose such sanctions upon the broker with whom the salesperson is affiliated if the commission finds that the broker had knowledge of the salesperson's actions that violated this section.
(C) The commission shall, pursuant to section 4735.051 of the Revised Code, impose disciplinary sanctions upon any foreign real estate dealer or salesperson who, in that capacity or in handling the dealer's or salesperson's own property, is found guilty of any of the acts or omissions specified or comprehended in division (A) of this section insofar as the acts or omissions pertain to foreign real estate. If the commission imposes such sanctions upon a foreign real estate salesperson for a violation of this section, the commission also may suspend or revoke the license of the foreign real estate dealer with whom the salesperson is affiliated if the commission finds that the dealer had knowledge of the salesperson's actions that violated this section.
(D) The commission may suspend, in whole or in part, the imposition of the penalty of suspension of a license under this section.
Sec. 4735.23. At the request of the superintendent of real estate, the department of higher education may, in consultation with the division of real estate, perform a review of programs offered by an institution of higher education pursuant to division (B)(6)(a) or (b) of section 4735.07 and division (F)(6) of section 4735.09 of the Revised Code. The superintendent or the chancellor of higher education may request from the institution any information the superintendent or chancellor considers necessary to perform this review.
Sec. 4735.24. (A) Except as otherwise provided in this section, when earnest money connected to a real estate purchase agreement is deposited in a real estate broker's trust or special account, the broker shall maintain that money in the account in accordance with the terms of the purchase agreement until one of the following occurs:
(1) The transaction closes and the broker disburses the earnest money to the closing or escrow agent or otherwise disburses the money pursuant to the terms of the purchase agreement.
(2) The parties provide the broker with separate written instructions that both parties have signed that specify how the broker is to disburse the earnest money and the broker acts pursuant to those instructions.
(3) The broker receives a copy of a final court order that specifies to whom the earnest money is to be awarded and the broker acts pursuant to the court order.
(4) The earnest money becomes unclaimed funds as defined in division (M)(2) of section 169.02 of the Revised Code and, after providing the notice that division (D) of section 169.03 of the Revised Code requires, the broker has reported the unclaimed funds to the director of commerce pursuant to section 169.03 of the Revised Code and has remitted all of the earnest money to the director.
(B) A purchase agreement may provide that in the event of a dispute regarding the disbursement of the earnest money, the broker will return the money to the purchaser without notice to the parties unless, within two years from the date the earnest money was deposited in the broker's trust or special account, the broker has received one of the following:
(1) Written instructions signed by both parties specifying how the money is to be disbursed;
(2) Written notice that a court action to resolve the dispute has been filed.
(C)(1) If the parties dispute the disbursement of the earnest money and the purchase agreement contains the provision described in division (B) of this section, not later than the first day of September following the two year anniversary date of the deposit of the earnest money in the broker's account, the broker shall return the earnest money to the purchaser unless the parties provided the broker with written instructions or a notice of a court action as described in division (B) of this section.
(2) If the broker cannot locate the purchaser at the time the disbursement is due, after providing the notice that division (D) of section 169.03 of the Revised Code requires, the broker shall report the earnest money as unclaimed funds to the director of commerce pursuant to section 169.03 of the Revised Code and remit all of the earnest money to the director.
Sec. 4735.51. As used in sections 4735.51 to 4735.74 of the Revised Code:
(A)
"Agency" and "Agencyagency
relationship" mean a relationship
in which a licensee represents another person in a real
estate transaction.
(B) "Agency agreement" means a contract between a licensee and a client in which the client promises to pay the broker a valuable consideration, or agrees that the licensee may receive a valuable consideration from another, for performing an act that requires a real estate license under this chapter.
(C) "Agent" and "real estate agent" mean a person licensed by this chapter to represent another in a real estate transaction.
(D) "Affiliated licensee" means a real estate broker or a real estate salesperson licensed by this chapter who is affiliated with a brokerage.
(E)
"Brokerage"
means a corporation, partnership, limited partnership,
association, limited liability company, limited liability
partnership, or sole proprietorship issued a broker's license.
"Brokerage" includes the affiliated licensees who have been
assigned management duties that include supervision of licensees
whose duties may conflict with those of other affiliated
licensees.
(F)
"Client"
means a person who has entered into an agency relationship
with a licensee.
(G)
(F)
"Confidential
information" means all information that
a client directs to be kept confidential or that if disclosed
would have an adverse effect on the client's position in
the real estate transaction, except to the extent the agent is
required by law to disclose such information, and all information
that is required by law to be kept confidential.
(H)
(G)
"Contemporaneous
offers"
means offers to purchase or
lease on behalf of two or more clients represented by the same
licensee for the same property that the licensee knows, has known,
or has reason to know will be taken under consideration by
the owner or owner's
authorized representative during the same
period of time.
(H) "Dual agency relationship" means any of the dual agency relationships set forth in section 4735.70 of the Revised Code.
(I) "In-company transaction" means a real estate transaction in which the purchaser and seller are both represented by the same brokerage.
(J)
"Licensee" means any individual licensed as a real estate
broker or salesperson by the Ohio real estate commission pursuant
to this chapter.
(K)
"Management level licensee" means a licensee who is
employed
by or affiliated with a real estate broker and who has supervisory
responsibility over other licensees employed by or affiliated
with that real estate broker.
(L)
"Purchaser"
means a party in a real estate transaction who
is the potential transferee of property. "Purchaser"
includes
a person seeking to buy property and a person seeking to
rent property as a tenant or lessee.
(M)
(K)
"Real
estate transaction" means any act that is described
in division (A) of section 4735.01 of the Revised Code or
that is related to the execution of an act described in that section.
(N)
(L)
"Subagency"
and "subagency relationship" mean an agency
relationship in which a licensee acts for another licensee
in performing duties for the client of that licensee.
(O)
(M)
"Timely"
means as soon as possible under the particular
circumstances.
Sec. 4735.65. (A) In representing a purchaser in an agency relationship, a licensee shall:
(1) Seek a property at a price and with purchase or lease terms acceptable to the purchaser. Unless the client so directs, the licensee is not obligated to seek additional purchase or lease possibilities if the purchaser is a party to a contract to purchase property, or has entered into a lease or has extended a letter of intent to lease.
(2) Within the scope of knowledge required for licensure, answer the purchaser's questions and provide information to the purchaser regarding any offers or counteroffers;
(3) Assist the purchaser in developing, communicating, and presenting offers or counteroffers;
(4) Present any offer to purchase or lease to the seller or the seller's agent in a timely manner, even if the property is subject to a contract of sale, lease, or letter of intent to lease, and accept delivery of and present any counteroffers to the purchaser in a timely manner;
(5) Within the scope of knowledge required for licensure, answer the purchaser's questions regarding the steps the purchaser must take to fulfill the terms of any contract.
(B) A licensee does not breach any duty or obligation to the purchaser by showing the same properties to other purchasers or by preparing or presenting contemporaneous offers to purchase or lease the same property. Prior to preparing a contemporaneous offer, a licensee shall disclose that fact to all clients for whom the licensee is preparing, presenting, or has prepared or presented contemporaneous offers to purchase or lease the same property and shall refer to another licensee any client that requests such referral.
(1) The disclosure required by this section shall be provided in writing unless written disclosure cannot be delivered in a timely manner, in which case the licensee shall provide the disclosure verbally.
(2) A licensee does not breach a duty of confidentiality to any client by disclosing the fact of contemporaneous offers, but shall maintain as confidential between the purchasers the identity of the purchasers and the terms of the offers.
(C) A licensee does not breach any duty or obligation to the purchaser by acting as an agent or subagent for other purchasers, or as an agent or subagent for sellers, except that any dual agency relationship must be disclosed to a client pursuant to section 4735.71 of the Revised Code.
(C)
(D)
Nothing
in this section shall be construed as permitting
a licensee to perform any act or service that constitutes
the practice of law.
Section 2. That existing sections 4735.01, 4735.06, 4735.07, 4735.09, 4735.10, 4735.141, 4735.18, 4735.24, 4735.51, and 4736.65 of the Revised Code are hereby repealed.