House Study Bill 126 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON COMMERCE BILL BY CHAIRPERSON SODERBERG) A BILL FOR An Act relating to the licensing and regulation of real estate 1 brokers and salespersons. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 2631YC (3) 84 rn/rj

H.F. _____ Section 1. Section 543B.29, subsection 4, Code 2011, is 1 amended to read as follows: 2 4. A real estate broker’s or salesperson’s license shall be 3 revoked following three violations of this section or section 4 543B.34 within a three-year five-year period. 5 Sec. 2. Section 543B.33, Code 2011, is amended to read as 6 follows: 7 543B.33 Salespersons —— change of employment. 8 When any real estate salesperson is discharged or terminates 9 employment with the real estate broker by whom the salesperson 10 is employed, the real estate broker shall immediately deliver 11 or mail by certified mail to the real estate commission the 12 real estate salesperson’s license on the reverse side of 13 which the employing broker shall set out the date and cause 14 of termination of employment. The real estate broker at the 15 time of mailing the real estate salesperson’s license to the 16 commission shall address a communication to the last known 17 residence address of the real estate salesperson stating that 18 the license has been delivered or mailed to the commission. 19 A copy of the communication to the real estate salesperson 20 shall accompany the license when mailed or delivered to the 21 commission. It is unlawful for any real estate salesperson to 22 perform any of the acts contemplated by this chapter either 23 directly or indirectly under authority of a license from and 24 after the date of receipt of the license by the commission. 25 The commission shall, upon presentation of evidence by the 26 salesperson that the salesperson has been employed by another 27 broker, issue another license for the balance of the current 28 license period showing each change of employment. A fee as 29 determined by the commission shall be charged for the issuance 30 of the license. Not more than one license shall be issued to 31 any real estate salesperson for the same period of time. 32 Sec. 3. Section 543B.34, unnumbered paragraph 3, Code 2011, 33 is amended to read as follows: 34 If an investigation pursuant to this section reveals that an 35 -1- LSB 2631YC (3) 84 rn/rj 1/ 3

H.F. _____ unlicensed person has assumed to act in the capacity of a real 1 estate broker or real estate salesperson, the commission may 2 shall issue a cease and desist order, and may shall impose a 3 civil penalty of up to the greater of ten thousand dollars or 4 ten percent of the real estate sale price. 5 Sec. 4. Section 543B.56A, Code 2011, is amended to read as 6 follows: 7 543B.56A Brokerage agreements —— contents. 8 1. The purpose of this section is to promote the protection 9 of the public by establishing minimum standards reasonably 10 expected by the public in reliance upon the professional work 11 product of real estate licensees. The reliance of the public 12 and business community on sound professional opinions and 13 assistance imposes on real estate licensees certain obligations 14 both to their clients and to the public. The purpose of 15 this section is also to assist in ensuring that licensees’ 16 obligations are met including licensees’ exercising sound 17 independent business judgment, striving to continuously improve 18 professional business skills and knowledge in the industry, 19 promoting sound and informative real estate reporting, and 20 exercising the highest fiduciary duties to clients and the 21 public. 22 2. A brokerage agreement shall specify that the broker 23 shall, at a minimum, do all of the following: 24 1. a. Accept delivery of and present to the client offers 25 and counteroffers to buy, sell, rent, lease, or exchange the 26 client’s property or the property the client seeks to purchase 27 or lease. 28 2. b. Assist the client in developing, communicating, 29 negotiating, and presenting offers or counteroffers until a 30 rental agreement, lease, exchange agreement, offer to buy or 31 sell, or purchase agreement is signed and all contingencies are 32 satisfied or waived and the transaction is completed. 33 3. c. Answer the client’s questions relating to 34 the brokerage agreements, listing agreements, offers, 35 -2- LSB 2631YC (3) 84 rn/rj 2/ 3

H.F. _____ counteroffers, notices, and contingencies. 1 4. d. Provide prospective buyers access to listed 2 properties. 3 EXPLANATION 4 This bill makes specified modifications to provisions 5 relating to the licensing and regulation of real estate brokers 6 and salespersons. 7 The bill changes a provision currently providing that a real 8 estate broker’s or salesperson’s license shall be suspended 9 or revoked following three violations described in Code 10 section 543B.29, which specifies conditions for suspension or 11 revocation, during a three-year period, to a five-year period. 12 The bill deletes a requirement that a real estate broker mail 13 by certified mail to the real estate commission the license of 14 a discharged or terminated salesperson employed by the broker, 15 with the result that only regular mail is required. The bill 16 changes a current provision that the real estate commission, 17 upon determining that an unlicensed person has acted in the 18 capacity of a real estate broker or real estate salesperson, 19 may issue a cease and desist order or impose a specified civil 20 penalty, to a requirement that the commission shall issue an 21 order and impose a penalty. 22 Additionally, the bill adds to Code section 543B.56A, 23 relating to the contents of brokerage agreements, a provision 24 specifying that the purpose of the Code section is to promote 25 the protection of the public by establishing minimum standards 26 for the professional work product of licensees, and to assist 27 ensuring specified licensee obligations are met. 28 -3- LSB 2631YC (3) 84 rn/rj 3/ 3