Chapter 1: Law & Related Regulations Flashcards
Real Estate brokerage is governed by both _______ law and ________ law, found in the ____ of Maryland __________, abbreviated as _____.
Statutory
Administrative
Code, Regulations
COMAR
In addition to statutes and regulations, some aspects of _______ _____ apply to real estate brokerage in MD and is called “the unwritten law.”
Common law
_________ _______ is not written by a legislative body; rather, it is found in numerous volumes of decisions from courts of appeal.
Common law
What type of decisions are needed when no relevant statute exists or when an existing statute is challenged as unconstitutional, and arise in cases of ambiguity where uncertainty of language or intent makes a statute difficult to apply?
Common law decisions.
What takes statutes at their face value and defers to the original intention of their writers?
Strict construction
In 1965, the U.S, Supreme Court held that the Civil Rights Act of 1866 still applied literally - word for word - and was still the law of the land almost a century after it was written. What is this decision an example of?
Strict construction
________ are voted into law by legislative bodies.
Statutes
_______ ______ is handed down by judges.
Common law
Decisions made by courts of appeal become binding on lower courts within their judicial area. The higher the court of appeal making a decision, the more numerous the courts in which that decision becomes the standard - the ________ - for decisions made later in those lower courts
Precedent
TheMD Real Estate Commission is one of the largest licensing boards within the Dept of Labor, Licensing, and Regulation, and adopts and enforces regulations to implement the Brokers Act. These regulations are ____________ _____.
Administrative law.
How many licensing boards are there in MD?
18
A real estate __________ is defined as an individual who provides the following services:
- for consideration and for another person, selling,
buying, exchanging, or leasing any real estate or
collecting rent its use - for consideration, assisting another person to
locate or obtain for purchase or lease any
residential real estate - engaging regularly in a business of dealing in real
estate of leases or options on real estate - engaging in a business the primary purpose of
which is promoting the sale of real estate through a
listing in a publication issued primarily for
promotion of real estate sales - engaging in the business of subdividing land
located in any state and selling the subdivided lots - for consideration, serving as a consultant for any
of the activities in this list
Broker
Although MD law generally defines PERSONS as “individuals, receivers, trustees, guardians, personal representatives, fiduciaries, or representatives of any kind and any partnership, firm, association, or other entity,” only _______ ________ may hold Maryland real estate licenses. However, a broker’s license, rather than showing the broker’s actual name, may show the name under which the broker is operating - typically a company name. This is called the broker’s ________ ________
natural persons
designated name
The Commission issues three levels of license for those delivering real estate brokerage services - what are they?
Broker
Associate Broker
Salesperson
Who issues branch office certificates and time-share licenses?
the Commission
How long may a license be kept on inactive status before expiring?
4 years.
How long are expired licenses held, from the date of their expiration, before they can no longer be reinstated?
4 years.
Can a person with an inactive or expired license receive compensation from “referral companies”?
No
Which license covers the following?:
- resident
- nonresident
- reciprocal
- temporary/for commercial only
Broker
In addition to being licensed, some associate brokers and salespersons may also be _________ manage branch offices.
Registered
Affiliates, although fully subject to supervision and control by their brokers, can still meet IRS requirements for qualified real estate agent - also called ________ ___________ - and be treated as self-employed from the point of view of income taxation.
statutory nonemployee
SEction 3508 of the IRS Code specifies that qualified real estate agents may report their income as self-employed persons using Schedule ______.
1040C
To be recognized as a qualified real estate ________, affiliates must:
- hold an active real estate license
- receive “substantially all” - meaning no less than
90% - of their brokerage remuneration based on
production rather than upon hours worked; and - act pursuant to written contracts with their
brokerage firms stating that they will not be treated
as employees for federal tax purposes.
agent
_______ (the noun) refers either to a licensed associate broker or a licensed salesperson.
Affiliate
_______ ________ are individuals who have met the educational, experience, and testing requirements for becoming real estate brokers but who request licenses that authorize them to provide real estate brokerage services only under a broker with whom they affiliate as such.
Associate brokers
Despite their education and experience, _______ __________ duties and authority are no greater than those of salesperson.
Associate brokers’
__________ and ________ ________ are individuals who aid brokers with whom they are affiliated, in providing real estate brokerage services, and are generally agents of their broker.
Associate brokers and salespersons
What is defined as “many interests in real property anywhere” and even includes interest in condominiums, time-share estates, and time-share licenses, as those terms are defined in the Real Property Article, as well as fee and life estates.
Real Estate
Are persons acting under a judgment or order of a court subject to the Brokers Act when performing acts of real estate brokerage?
No.
Are public officers performing the duties of their office subject to the Brokers Act when performing acts of real estate brokerage?
No
Are landlords or owners of any real estate, unless their primary business is providing real estate brokerage services, subject to the Brokers Act when performing acts of real estate brokerage?
No
Are persons engaging in a single transaction selling or leasing real estate subject to the Brokers Act when performing acts of real estate brokerage, if they are acting under a power of attorney executed by the owner of that real estate?
No.
Are auctioneers who are licensed by various jurisdictions within MD when selling real estate at public actions subject to the Brokers Act when performing acts of real estate brokerage?
No.
Are persons acting as receivers, trustees, personal representatives, or guardians subject to the Brokers Act when performing acts of real estate brokerage?
No.
Are financial institutions in the leasing or selling of property they have acquired through foreclosure or by receiving a deed or an assignment in lieu of foreclosure subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
Are lawyers who are not regularly engaged in the business of providing real estate services and who do not advertise that they conduct such business subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
Are homebuilders in the rental or initial sale of homes they have constructed subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
Are agents of a licensed real estate broker or of an owner of real estate, while managing or leasing that real estate for that broker or for the property’s owner subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
Are persons who negotiate the sale, lease, or transfer of businesses when the sale does not include any interest in real property other than the lease for the property where the business operates subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
Are owners who subdivide and sell, not more than six, lots of unimproved property they own in any one calendar year subject to the Brokers Act when performing acts of real estate brokerage?
Yes.
How many members does the Commission consist of?
9
How many of the members of the Commission must hold real estate licenses, where do they need to be chosen from, how long must they have held a license and how long must they have resided in the areas from which they are appointed?
5
Eastern Shore Southern MD Western MD Baltimore Metropolitan Area Baltimore City
At least 5 years
Who are the four non-licensee members of the Commission? For how long before the appointment must they have not had an ownership interest in, or received compensation from, an entity regulated by the Commission?
Consumers
The year just before their appointment.
Who are the members of the Commission appointed by and to whose advice and consent?
the Governor with the advice of the Secretary
the Senate.
When to membership terms (which are staggered to ensure regulatory continuity) begin and end?
June 1st
4 years later.
Each year, members of the Commission elect form among themselves a ________ to preside at their meetings. This person is covered by a ______ ______.
Chairperson
Surety bond
How often does the Commission meet with the majority of the members?
Once a month.
When does the Commission meet constitution a quorum?
By appointment
Are Commission meetings open to the public?
Yes.
How can a member of the public be allowed to speak in a Commission meeting?
With 10 day’s advance written notice.
Who is the Commission’s executive director appointed, and serve at the pleasure, of?
The Secretary.
Is the Commission’s executive director a member of the Commission?
No.
Can the executive director be the chairperson of the Commission?
No.
Who’s title does this describe?
“A State employee who is covered by a surety bond, attends and participates in the monthly meetings, directs the day-to-day operations of the Commission, and supervises its office staff and field inspectors between monthly meetings.”
The Executive Director of the Commission.
Who is empowered to investigate complaints of unlicensed brokerage activity?
The Commission
Who is empowered to investigate complaints about licensee behavior?
The Commission
Who is empowered to conduct hearings and administer oaths?
The Commission
Who is empowered to issue subpoenas for attendance of witnesses or production of evidence?
The Commission