On January 21, the Trust Fund Study Committee of the Real Estate Licensing Board met at the Board's office in Raleigh. Present at this meeting were Committee Members A. P. Carlton (Chairman) presiding, B. Hunt Baxter, Jr., and James A. Beaty, Jr. Also present were Board Chairman Brantley T. Poole, various members of the Licensing Board staff and numerous persons from the brokerage and property management fields of the real estate industry.

The Trust Fund Study Committee was created by the Real Estate Licensing Board to examine its current rules and policies relating to trust funds and trust accounts and to make recommendations to the Board as to any changes which the Committee deems necessary.

At the two-hour Committee Meeting, Chairman Carlton briefed those in attendance on the background and purpose of the Committee. Phillip Fisher, the Board's Administrative Assistant, then presented certain proposed "guidelines" which were prepared for the Committee's consideration by the Licensing Board staff. The Committee Members and persons from the audience were free to comment on the proposals as they were presented. Of particular interest were the proposals regarding when to deposit trust funds and how to make proper disclosure when trust funds are being deposited in an interest--bearing account.

The Committee will consider the proposed "guidelines" together with the comments which it has received and will then make its recommendations to the Real Estate Licensing Board. [NOTE: Upon the recommendation of the Committee, the Real Estate Licensing Board at its February meeting voted to hold a rule-making hearing to propose the amendment and adoption of certain rules relating to trust funds (See Bulletin, page two). The Committee will submit to the Board its final recommendations for trust fund "guidelines" at a future meeting.]

Board Member Bart T. Bryson of Hendersonville was recently installed as President of Chapter 40 of the American Institute of Real Estate Appraisers (AIREA).

Mr. Bryson is a Member of the Appraisal Institute (MAI) and the Society of Real Estate Appraisers (SRPA) and has taught courses in real estate appraising and brokerage at various universities and technical institutes and at the REALTOR'S Institute in Chapel Hill.

Mr. Bryson is the second Member of the Real Estate Licensing Board

currently serving as president of a state-wide association. In September, Dee McCandlish, Vice Chairman of the Board, was installed as President of the Mortgage Bankers Association of the Carolinas. Ms. McCandlish is Regional Vice President and Manager of the Charlotte Branch of First Atlantic Corporation.

At its January meeting, the Real Estate Licensing Board considered the question of whether an unlicensed resident manager of a condominium complex employed by the condominium Homeowners Association may lease or manage the condominium units for compensation (whether paid to the Association or to the manager).

Based upon the facts in the particular case before the Board, the Board determined that the Association itself needed a real estate broker's license, and the individual(s) performing the actual rental services must be licensed as a real estate broker or salesman.

The following excerpt from the Board's ruling, states the reasoning behind their decision:

"The real estate license law defines a real estate broker as ,any person, partnership, association, or corporation who, for a compensation or valuable consideration or promise thereof . . . leases or offers to lease . . . or rents or offers to rent any real estate . . . for others.' G.S. 93A-2(a). The statute goes on to exempt 'any person, partnership, association or corporation, who, as owner . . . . shall perform any of the acts aforesaid with reference to property owned . . . by them,' and states that the statute does not 'require a license for the owner, personally, to sell or lease his own property.' G.S. 93A-2(c).

"Obviously, any condominium unit owner may lease or rent his own property without a license. In addition, a bona fide employee of the unit owner may manage his employer's property without a license. But the proposal to have unlicensed employees of the Owners Association manage the property falls outside the 'owner exemption.' The reason is simple: the Association does not own the property. It is an entity comprised of unit owners, but as an entity the Association itself is not the property owner. Consequently, the Association, through its employees, would be managing property for others, for compensation. Without a license, this practice is forbidden by the statute."