Common License Law Violations Flashcards
Demonstrating unworthiness or incompetency to act as a real estate broker or salesperson
Failing to provide documents in a timely manner that result in missed contractual deadlines
Making substantial and willful
Misrepresentations
Failing to provide adequate disclosures regarding the true purchaser of a property.
Not informing other that you are purchasing property for yourself
Contractual Interference
Jake has a buyer for an investment property, but Jake wants to get both ends of the deal, so he tells the seller, who is already listed with another broker, to terminate, and list with him, because he has a ready buyer.
Offering a property for sale without the owner’s permission
Trudy found an abandoned property and began marketing the property to prospective buyers without the owner’s permission, figuring if she could bring the owner a buyer, she’d have a deal.
Placing a sign on a property without the owners consent
Bill wants to sell his listing, and he’d like to pick up buyers in the process. His listing is in a great neighborhood where he wants visibility. His owner is out of state and wants a private sale, but Bill’s not getting any calls from the MLS listing. He posts a for sale sign on the property without the owner’s permission.
Accepting the services of a salesperson who is employed by another broker without that broker’s knowledge or consent:
Mark wants to leave his brokerage, but he has some listings pending, so he goes to work for his new broker without informing his current broker.
Retaining information from a listing agreement after terminating association with the broker:
Jill is leaving ABC Realty. She doesn’t want her broker to take her clients, the Schillers, who are her best listing yet, so she refuses to turn over the listing documentation.
Being a party to a listing agreement with an automatic renewal provision
Becky has a listing that she knows will take some time to sell, but her sellers don’t want to list for more than three months. Becky says, “Fine, but to make things easier, let’s set up an automatic renewal clause.”
Performing services that would qualify as practice of law and should be performed by an attorney
Steven tells his clients, “It’s better if you take title as tenants in common.” Other forms of this violation include drafting legal documents, such as deeds and mortgages, giving an opinion as to the legality of a document, or giving advice or an opinion or providing an interpretation that could be taken as legal advice.
Failing to account for and remit funds belonging to others that have come into the licensee’s possession
Carly received an earnest money check from her client, Jeff, on Friday. She went out of town for a long weekend and failed to deliver the check to her broker before she left. When she returned, she could not find the check.
Commingling (mixing client funds with business or personal funds)
Traffic was awful, and Henri simply could not be bothered with another trip to the bank, so for the time being, he deposited his client’s earnest money funds into his business account, intending to remove them the following business day.
Entering into a net listing agreement:
Laura told her clients, “Look, we’ll be lucky to get $200,000 for this place. I won’t charge you anything to list it, but anything we get above $200,000 is mine to keep. Deal?”
Discriminating in the sale, rental, or advertisement of housing or commercial space covered by law:
Cassie, a salesperson, is a bigot and refuses to work with any minority clients. If she receives a floor call from someone with an accent, she tells the person she is too busy to help him.
Failing to maintain adequate records for the required retention period
Joe is a real estate broker who is terrible with paperwork. Rather than maintain records, he shreds them. “That way, nothing can come back to haunt me, right?” (Wrong, Joe.)
