Ky Real State Test Ch 1 Flashcards

Question

D: Formal Hearing

Answer 1

The hearing held by the Kentucky Real Estate Commission to determine if the license law has been violated by a licensee. Also referred to as an administrative hearing.

Answer 2

One of the penalties that can be imposed against licensees who are found to have violated one of the license laws. The formal reprimand is a notice in the KREC newsletter that is made available to all licensees.

Answer 3

Under the license law, a Kentucky Real Estate Commission disciplinary hearing may be conducted by a hearing officer who is an assistant attorney general. The hearing officer conducts the hearing, rules on evidence, and submits findings of fact and conclusions of law to the Executive Director of the Kentucky Real Estate Authority for a final decision.

Answer 4

A penalty that is imposed by the KREC for license law violations that requires a notice of the violation to be placed in the licensee’s file but not placed in the KREC newsletter.

Answer 5

The process used by the KREC to gather facts when there has been an allegation that a licensee has violated the license law.

Answer 6

AKA: 201 KAR 11 Regulations promulgated by the Kentucky Real Estate Commission to regulate real estate licensees and their licensed activities.

Answer 7

The state association for the National Association of REALTORS®. Kentucky licensees may join the association if they want to become REALTORS®.

Answer 8

The administrative agency created by the Kentucky legislature to protect the interests of the public by regulating real estate licensees. Regulating licensees includes both conducting licensing examinations for people desiring a real estate license and disciplining licensees who violate the license laws or regulations after they are licensed. As part of the discipline process, the KREC is authorized to investigate alleged violations by licensees and to hold hearings to determine whether or not violations occurred. If it is determined that a violation did, in fact, occur, the Commission has the power to discipline the licensee.

Answer 9

AKA: KRS 324 The Kentucky statutes that regulate the licensing of real estate brokers and sales associates.

Answer 10

A licensee that chooses not to belong to the National Association of REALTORS®. Licensees are not required to be REALTORS®.

Answer 11

A public official with the authority to administer oaths, to take acknowledgements, to attest and certify documents, and to authenticate signatures.

Answer 12

After a court or administrative agency renders a decision in a case, an Order is entered that sets forth the decision that is sent to all parties.

Answer 13

The process used by the Kentucky Real Estate Commission to settle disputes prior to a formal hearing. Also referred to as a settlement conference and mediation.

Answer 14

A case that appears “on its face” to have been a violation of the licensing law. That is if the facts as stated are a violation of the law. If the facts would show a violation, and if proven by evidence at a hearing, a prima facie case exists and the case goes forward. The complainant must then prove the facts, before the licensee will be disciplined.

Answer 15

One of the penalties that can be imposed by the KREC against a licensee after a formal hearing. The licensee will be permitted to practice real estate, but will be required to submit to certain reporting requirements during the term of the probation. The maximum length of time for probation is twelve (12) months. Once the probation period is over, the licensee will not be required to report.

Answer 16

Money damages that may be assessed by the courts or an arbitrator in certain types of lawsuits that are designed to punish the wrongdoer.

Answer 17

The physical land, including what is beneath the surface and what is above the surface, as well as improvements attached to the land. Improvements include structures, easements, licenses, roads, sewers and anything else attached to the surface, beneath the surface, or above the land. It is defined for license law purposes in KRS 324.010(5) to include not only real estate in its ordinary sense as described above, but also to include “timeshares, options, leaseholds, and interests less than leaseholds.” Also referred to as realty and real property.

Answer 18

As defined in KRS 324.010(1) of the license law: “a single, multiple, or continuing act of dealing in timeshares or options, selling or offering for sale, buying or offering to buy, negotiating the purchase, sale, or exchange of real estate, engaging in property management, leasing or offering to lease, renting or offering to rent, or referring or offering to refer for the purpose of securing prospects, any real estate or the improvements thereon for others for a fee, compensation, or other valuable consideration.”

Answer 19

This fund is created by statute, administered by the Kentucky Real Estate Commission, and funded by real estate licensee fees, to provide funds for real estate licensee education, to assist in real estate research, and to compensate consumers who may have been damaged by fraudulent acts of real estate licensees.

Answer 20

The designation used by real estate licensees that belong to the National Association of REALTORS®.

Answer 21

The physical land, including what is beneath the surface and what is above the surface, as well as improvements attached on to the land. Improvements include structures, easements, licenses, roads, sewers and anything else attached to the surface, beneath the surface, or above the land. Also referred to as realty and real estate.

Answer 22

The physical land, including what is beneath the surface and what is above the surface, as well as improvements attached to the land. Improvements include structures, easements, licenses, roads, sewers and anything else attached to the surface, beneath the surface, or above the land. Also referred to as real property and real estate.

Answer 23

The licensee named as the defendant in a Kentucky Real Estate Commission complaint.

Answer 24

One of the penalties that can be assessed against a licensee by the KREC after a formal hearing is revocation of license. If the license is revoked the person cannot practice real estate for a period of at least five (5) years. After five (5) years the person can re-apply for a license, but receiving another license is at the discretion of the Commissioners.

Answer 25

Penalties that may be assessed against real estate licensees by the Kentucky Real Estate Commission. These include. 1. License Suspension 2. License Revocation 3. Fines not to exceed $1000 4. Probation of up to 12 months 5. Additional Continuing Education 6. Formal Reprimands 7. Informal Reprimands

Answer 26

The time permitted to bring a certain type of lawsuit or complaint. For example, the statute of limitations to file a claim at the KREC is one (1) years from the date of the event or when it could have been reasonably discovered.

Answer 27

A document issued by an administrative agency or court that requires a person to attend a deposition, testify at a trial, or produce documents.

Answer 28

One of the penalties that can be imposed by the KREC after a formal hearing. When a licensee is suspended, he/she cannot practice real estate for a period of time. After that period has passed, the license is re-activated and the licensee may practice real estate again.

Answer 29

The document filed with the Kentucky Real Estate Commission when someone wants to complain about the actions of a real estate licensee or someone illegally practicing real estate without a license. Verification means that the complaint must be signed and notarized.

Answer 30

The document that is filed with the KREC by the licensee in response to a Verified Complaint that has been filed against him/her.

Answer 31

A person or persons, or entity or entities, for whom a licensee provides real estate brokerage services: 1. Who has entered into a written agreement with a principal broker for provision of real estate brokerage services; 2. With whom or for whom a licensee completes an offer to purchase or lease for real estate; 3. For whom a licensee otherwise by oral agreement performs acts of real estate brokerage; For the purposes of selling or leasing real estate, the client is the person or persons, or entity or entities, authorized to sell or lease the subject real estate.

Answer 32

means a transaction other than the sale of a single-family residential property, multifamily property containing four (4) units or less, or single-family residential lot.

Answer 33

The absolute ownership of a unit in a multi-unit building based on a legal description of the airspace the unit actually occupies; or A separate dwelling unit in a multi-unit development, plus an undivided interest in the ownership of the common elements in the building or development, which are owned jointly with the other condominium unit owners.

Answer 34

a person or entity with whom a licensee exchanges information that is public in nature, but otherwise does not perform acts of real estate brokerage and with whom no written or oral agency agreement or fiduciary relationship exists.

Answer 35

means earnest money delivered to a licensee in conjunction with a real estate sales contract after: (a) The offer or counteroffer is accepted; and (b) An executory contract exists.

Answer 36

Means an original Kentucky sales associate license issued by the commission for the first time or a Kentucky sales associate license re-issued to a person who formerly held a license issued by the commission.

Answer 37

Means every solicitation or attempt to bring about the sale, exchange, lease, assignment, license, or award with regard to a timeshare interest in real estate.

Answer 38

Means a person or entity who has not entered into a written or oral agreement with a principal broker to provide real estate brokerage services, but to whom a licensee offers real estate brokerage services or from whom a licensee receives confidential information related to a contemplated real estate transaction.

Answer 39

Means the time period commencing on April 1 of each year and ending on March 31 two (2) calendar years thereafter.

Answer 40

Means an arrangement under which one may acquire, for a period of time, the right to use and occupy property, for a recurring block of time. A timeshare may be: (a) A timeshare estate, if a freehold estate or an estate for years is conveyed; (b) A vacation lease, if a buyer purchases the right to occupy a specific accommodation for a specified time period over a specified number of years; (c) A vacation license or club membership, if a buyer acquires the right to occupy an undesignated unit at certain real property or properties during a specific time each year for a specific number of years; or (d) Variations of paragraphs (a) through (c) of this subsection that result in the acquisition of the right to use real property for a limited period of time in recurring intervals for a number of years.

Answer 41

Means a type of residential dwelling with two (2) floors that is connected to one (1) or more dwellings by a common wall or walls. Title to the unit and lot vest in the owner who shares a fractional interest with other owners in any common areas.

Answer 42

Means a form of brokerage service or services provided to either or both parties to a transaction if the licensee owes to the parties only the duties owed to a consumer and if confidential information is not relayed between the parties by the licensee, unless so directed by the sending party.

Answer 43

Means as soon as reasonably possible based on the availability of the licensee and the client, and subject to any written agreement between them as to how and when written offers will be submitted.

Answer 44

(a) For contract deposits or money belonging to others, within three (3) business days of the receipt by the principal broker or an affiliated licensee of the principal broker; or (b) For notice required by KRS 324.360(8), within seventy-two (72) hours of the listing agent’s receipt of the prospective purchaser’s written and signed offer to purchase.

Answer 45

(a) Be filed on the Sworn Statement of Complaint, KREC Form 300; (b) Allege a prima facie case of specific violation of KRS 324.160 by a licensee or a case of unlicensed brokerage against an unlicensed individual; (c) State the basis of the complaint fully, including the name of the principal broker, if known; (d) Be notarized by a notary public; and (e) Include a copy of all the following documents relevant to the complaint or a written explanation of why the documents are unavailable: 1. Listing contract; 2. Purchase contract; 3. Seller's Disclosure of Property Condition form, incorporated by reference in 201 KAR 11:121; 4. Agency Consent Agreement and the Guide to Agency Relationships forms, incorporated by reference in 201 KAR 11:121; 5. Settlement statement; and 6. Any other documentation to support a claim or alleged violation. (2) The complaint shall be filed no more than one (1) year from: (a) Actual knowledge of the cause of action; or (b) The time circumstances would reasonably have put the complainant on notice of the cause of action.

Answer 46

1) Upon receipt of a complaint, commission staff shall review the complaint to determine whether the complaint states a prima facie violation of KRS Chapter 324. (2) If a supplement to the complaint is required because the original complaint was deficient, the supplement shall be filed on Sworn Supplement to Complaint, KREC Form 302 and notarized. (3) (a) If the commission staff determine the complaint alleges a prima facie case of a specific violation of KRS 324.160, the complaint shall be served for an answer on the licensee as established in KRS 324.151(2). (b) A responding licensee shall file a Sworn Answer to Complaint, KREC Form 301 in accordance with KRS 324.151(3). (4) The answer shall: (a) State an answer to the complaint; (b) Be notarized by a notary public; and (c) Include a copy of the following documents or a written explanation of why the documents are unavailable: 1. Listing contract; 2. Purchase contract; 3. Seller's Disclosure of Property Condition form, incorporated by reference in 201 KAR 11:121; 4. Agency Consent Agreement and the Guide to Agency Relationships forms, incorporated by reference in 201 KAR 11:121; 5. Settlement statement; and 6. Any other documentation to rebut a claim or alleged violation. (5) (a) The complainant may file one (1) reply to the respondent’s Sworn Answer to Complaint within ten (10) days of receiving the respondent’s Sworn Answer to Complaint; (b) The respondent may file one (1) reply to complainant’s reply within ten (10) days of receiving the complainant’s reply; and (c) All replies shall be notarized and include any documents necessary to support or rebut an allegation or a violation. (6) (a) For purposes of calculating filing deadlines prescribed by this administrative regulation, the commission shall follow the Kentucky Rules of Civil Procedure. (b) A request for an extension of any filing deadline prescribed by this administrative regulation shall be made directly to the office of general counsel and shall be granted or denied. If the request is denied, the requester shall have the opportunity to appeal the decision to the commission at its next scheduled meeting. (7) The commission shall not entertain motions with regard to pending complaints.

Answer 47

(1) (a) The commission chair may create at least one (1) complaint screening committee. (b) Each complaint screening committee shall consist of no more than three (3) commissioners. (2) The complaint screening committee shall: (a) Review complaints, supplements, answers, and replies consistent with the Complaint Review Process Chart; (b) Order investigation or further investigation; (c) Review investigative reports; (d) Determine whether the commission’s Research, Education, and Recovery fund shall be at issue; and (e) Make recommendations as to the disposition of the pending complaint to the full commission. (3) The committee may be assisted by the commission staff and counsel. (4) (a) Prior to the complaint screening committee’s review of an investigative report, the commission’s investigator shall notify the respondent that he or she may request a copy of the commission’s investigation report to review and address factual matters contained in the investigation report. (b) In the investigator’s determination, the report and exhibits shall be redacted to protect personal and sensitive information relating to witnesses. (c) If the respondent believes a factual discrepancy exists in the investigation report, he or she shall notify the investigator in writing within five (5) days of receiving the report for review and provide the investigator with supporting documentation to rebut the factual discrepancy, if available. (d) The investigator shall make any changes necessary based on his or her review of the respondent’s notification. (5) The committee shall report its findings and recommendations for disposition of complaints to the full commission in the form of a motion, and the commission shall: (a) Dismiss the complaint without an administrative hearing if the facts or evidence do not indicate a prima facie case for a violation of KRS Chapter 324; or (b) Find a violation of a provision of KRS Chapter 324 or 201 KAR Chapter 11 and issue notice of proposed action against the licensee consistent with KRS Chapter 13B. (6) The commission, through the complaint screening committee, may engage in informal settlement negotiations, consistent with Section 5 of this administrative regulation. (7) A commissioner shall recuse himself or herself from any matter relating to an administrative hearing or final order that resolves a case if he or she: (a) Performed or directed some or all of the investigation; (b) Has a personal or business relationship with either the complainant or any respondent; (c) Is the complainant, a respondent, or a witness; (d) Believes that his or her impartiality may fairly be called into question; or (e) Is advised to recuse by the office of general counsel or the executive director of the Kentucky Real Estate Authority. (8) The commission shall notify the complainant and respondent in writing of its decision regarding the disposition of a complaint.

Answer 48

(1) (a) An answer has not been filed; and (b) The withdrawal is made within twenty (20) days of the date the complaint was received by the respondent; or (2) (a) There is good cause for the withdrawal; and (b) The commission approves the withdrawal. (3) Nothing in this section shall prevent the commission from filing its own complaint against a licensee.

Answer 49

1) At any time following the filing of a complaint and answer, the commission, through its legal counsel, may enter into informal settlement proceedings with a licensee for the purpose of expeditiously resolving any disciplinary matter. (2) (a) The commission shall approve or reject all settlement proposals. (b) Any matter to which a licensee and the commission's legal counsel have stipulated that is rejected by the commission shall not thereafter bind the parties or the commission. (3) The commission may employ mediation as a method of resolving the matter informally. (4) All proposed agreed orders shall be signed by the licensee and shall advise the licensee that by entering into an agreed order, the licensee expressly acknowledges that the licensee is fully and completely informed of the due process rights afforded to the licensee and that the licensee knowingly, willingly, and voluntarily agrees to waive those rights and enter into an agreed order.

Answer 50

Any licensee found to have misrepresented facts in any sworn statement shall be subject to disciplinary proceedings by the commission and the commission may seek a criminal indictment for perjury.

Answer 51

(1) Consistent with KRS 324.150(1)(b) and KRS 13B.125, the commission may issue an emergency order prior to conducting a hearing if an alleged escrow account violation warrants emergency action. (2) An escrow account violation shall warrant emergency action if: (a) A licensee is alleged to have committed two (2) or more escrow account violations; (b) A licensee is alleged to have committed one (1) escrow account violation in excess of $500; or (c) A substantiated threat to the public’s health, safety, or welfare exists. (3) An emergency order authorized pursuant to this section shall be signed by the executive director, the chair of the commission, and one (1) member of the complaint screening committee. The order shall be served upon the licensee who is the subject of the emergency order pursuant to KRS 13B.125. (4) An emergency order issued pursuant to this section may be served on the appropriate financial institution to order an escrow account be frozen until further orders of the commission or a court of competent jurisdiction. (5) A licensee who is the subject of an emergency order issued pursuant to this section may request an emergency hearing in accordance with KRS 13B.125.

Answer 52

(1) If the Commission determines that the recovery fund shall be at issue in an administrative hearing, the complainant shall become a party. (2) The Commission shall not represent the complainant in the administrative hearing. (3) The complainant shall carry the burden of proof on the issue of damages.

Answer 53

The Department of Professional Licensing Ky Real Estate Authority.

Answer 54

1. KREC 2. Kentucky Board of Home Inspectors 3. Real Estate Appraisers Board 4. Board of Auctioneers

Answer 55

The Executive Director is appointed by the Secretary of the Public Protection Cabinet with the prior written approval of the Governor. The Executive Director must have at least ten (10) years of experience in one of the professions under the jurisdiction of the Kentucky Real Estate Authority. The Executive Director has the authority to approve or disapprove all administrative regulations, budgets, and expenditures promulgated or submitted by the Commissions/boards it oversees, including the KREC. The roles of the Kentucky Real Estate Authority and the KREC are discussed throughout this module.

Answer 56

The Kentucky Real Estate Commission is made up of seven (7) commissioners. This was a statute change (KRS 324.281) that went into effect on June 26, 2019. No more than four (4) Commissioners can be members of any one (1) political party. Further, no Commissioner may reside in the same county as any other Commissioner. Commissioners serve for three (3) year terms and may not serve more than two (2) consecutive terms. The exception is that a Commissioner appointed to fill a vacancy created by any reason other than the expiration of a term is only appointed for the remaining term of the vacancy. These three (3) year terms are staggered so that no more than two vacancies arise each year, unless a Commissioner dies or is removed for some other reason. Six (6) out of the seven (7) Commissioners are licensees who have been residents of Kentucky for at least ten (10) years immediately prior to their appointment and who have been active licensees for at least ten (10) years prior. The 7th Commissioner is a citizen-at-large who is not associated with or financially interested in real estate brokerage.

Answer 57

Citizen-at-large Commissioner is appointed by the Governor at his/her discretion. The other six (6) members are appointed by the Governor from a list provided by Kentucky REALTORS® (KYR), formerly known as The Kentucky Association of REALTORS® (KAR), a state trade association that represents licensees who become REALTORS®. Kentucky REALTOR® Institute (Links to an external site.) is the educational arm of Kentucky REALTORS®

Answer 58

False One (1) out of the seven (7) Commissioners is a Citizen-at-large (not a licensee) who is not associated with or financially interested in the practice or business regulated.