STOPPING PROBLEMS BEFORE THEY START

By Blackwell M. Brogden, Jr.
Deputy Legal Counsel

Many problems which arise during the course of real estate transactions and the day-to-day operation of real estate offices are unexpected and unavoidable. However, some types of problems which have come to the attention of the Real Estate Commission with increasing frequency can be stopped before they begin, by simply following the axiom—"Think before you act!" Or more specifically, "Think about the requirements of the Real. Estate License Law and the Commission's rules before you commit some improper act."

This is especially good advice to follow with regard to the following potential problem areas:

Unsupervised Salesman. A salesman's license does not become active until the salesman and the Broker-In-Charge of the office where the salesman works (i.e., the salesman's "supervising broker") have signed and mailed a "Supervision of Salesman Notification" form to the Commission office. The salesman may not work for or be compensated by any other person for acts performed as a real estate salesman.

Salesman Managing Office. Each office at which real estate brokerage is conducted must designate with the Commission a "Broker-in-Charge" of such office. The Broker-ln-Charge is responsible for personally and actively supervising ad salesmen who work at the office; for maintaining proper trust account and transaction records; and for performing other acts. A brokerage office can not be supervised by a licensed salesman.

Disbursement of Disputed Funds. When a real estate transaction does not "close", the real estate agent in possession of any trust money may not make a final determination as to whom the money should be paid. Although the agent may notify the parties of his plans with regard to the disbursement of such funds, if either party objects to the agent's intended disbursement; then the agent must continue to hold the trust funds in his/her trust account pending agreement between the parties or a court order.

Blind Advertisements. Any advertisement by a broker of property listed for sale must disclose the broker's status as a broker or the name of the broker's firm. Likewise, any advertisement by a salesman must disclose the name of the salesman's Broker-ln-Charge or firm. This is equally true for advertisements for the lease, rent, and exchange of real estate as well as for solicitations to obtain listings.