March 15, 2012, Introduced by Rep. Yonker and referred to the Committee on Regulatory Reform.
A bill to amend 1980 PA 299, entitled
"Occupational code,"
by amending sections 2501, 2503, and 2505 (MCL 339.2501, 339.2503,
and 339.2505), section 2501 as amended by 2008 PA 90, section 2503
as amended by 1990 PA 269, and section 2505 as amended by 2003 PA
196.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2501. As used in this article:
(a) "Affiliated company" means a legal entity that is wholly
owned, controlled, operated, or managed by another legal entity.
(b) (a)
"Employ" or
"employment" means the relationship
between a real estate broker and an associate broker or a real
estate salesperson which may include an independent contractor
relationship. The existence of an independent contractor
relationship between a real estate broker and an individual
licensed
to the real estate broker shall does
not relieve the real
estate broker of the responsibility to supervise acts of the
licensee
regulated by under this article.
(c) (b)
"Independent contractor
relationship" means a
relationship between a real estate broker and an associate broker
or real estate salesperson that satisfies both of the following
conditions:
(i) A written agreement exists in which the real estate broker
does not consider the associate broker or real estate salesperson
as an employee for federal and state income tax purposes.
(ii) Not less than 75% of the annual compensation paid by the
real estate broker to the associate broker or real estate
salesperson is from commissions from the sale of real estate.
(d) (c)
"Limited service
agreement" means a written service
provision agreement by which the real estate broker and client
establish an agency relationship in which certain enumerated
services, as set forth in section 2512d(3)(b), (c), and (d), are
knowingly waived in whole or part by the client.
(e) "Negotiate the mortgage of real estate" does not include
any activity in connection with the negotiation of a mortgage loan
for which a license is required under the mortgage brokers,
lenders, and servicers licensing act, 1987 PA 173, MCL 445.1651 to
445.1684.
(f) (d)
"Professional designation"
means a certification from
a
real estate professional association demonstrating attainment of
that an individual has attained proven skills or education in a
real estate occupational area and may include the right to use a
title
or letters after the a licensee's name that represent the
designation bestowed by the certifying entity.
(g) (e)
"Property management"
means the leasing or renting, or
the
offering to lease or rent, of real
property of others for a
fee, commission, compensation, or other valuable consideration,
pursuant to a property management employment contract. The term
includes residential property management.
(h) (f)
"Property management
account" means an interest-
bearing or noninterest-bearing account or instrument used in the
operation of property management.
(i) (g)
"Property management
employment contract" means the a
written agreement entered into between a real estate broker and
client concerning the real estate broker's employment as a property
manager
for the client; setting forth that
describes the real
estate broker's duties, responsibilities, and activities as a
property
manager; and setting forth that
describes the handling,
management, safekeeping, investment, disbursement, and use of
property management money, funds, and accounts.
(j) (h)
"Real estate broker"
means an individual, sole
proprietorship,
partnership, association, corporation, common law
trust,
or a combination of those entities who a person or
combination of persons that, with intent to collect or receive a
fee, compensation, or valuable consideration, sells or offers for
sale, buys or offers to buy, provides or offers to provide market
analyses of,
lists or offers or attempts to list, or negotiates the
purchase
or sale or exchange or of,
or negotiates the mortgage of,
real
estate; , or that
negotiates for the construction of a
building
on real estate; who that leases or offers or rents or
offers for rent real estate or the improvements on the real estate
for
others, as a whole or partial vocation; who that engages
in
property
management as a whole or partial vocation; who that sells
or offers for sale, buys or offers to buy, leases or offers to
lease, or negotiates the purchase or sale or exchange of a
business, business opportunity, or the goodwill of an existing
business
for others; or who, that, as owner or otherwise, engages
in the sale of real estate as a principal vocation.
(k) (i)
"Real estate salesperson"
means a person an individual
who for compensation or valuable consideration is employed either
directly or indirectly by a licensed real estate broker to sell or
offer
to sell, to buy or offer to buy, to provide or offer to
provide
market analyses of, to list or offer or attempt to list, or
to
negotiate the purchase or sale or
exchange or of, or
negotiate
the mortgage of, real estate, or to negotiate for the construction
of
a building on real estate, or to lease or offer to lease , or
rent
or offer for rent real estate; , who is
employed by a real
estate
broker to engage in property management;
, or who sells or
offers for sale, buys or offers to buy, leases or offers to lease,
or negotiates the purchase or sale or exchange of a business,
business opportunity, or the goodwill of an existing business for
others, as a whole or partial vocation.
(l) "Residential premises" means that term as defined in
section 2 of the truth in renting act, 1978 PA 454, MCL 554.632.
(m) "Residential property management" means to lease or rent,
or offer to lease or rent, residential premises owned by another
person, for a fee, commission, compensation, or other valuable
consideration, pursuant to a property management employment
contract.
(n) (j)
"Service provision
agreement" means a buyer agency
agreement or listing agreement executed by a real estate broker and
a client that establishes an agency relationship.
Sec.
2503. (1) This article shall does not apply to an
individual,
partnership, association, or corporation, who any of
the following:
(a) A person that, as owner, sells or offers for sale a
detached,
single family dwelling, duplex, triplex, or quadruplex ,
which
that has never been occupied and which that was
built by the
individual,
partnership, association, or corporation person while
licensed
under article 24. This article does not apply to an
individual,
partnership, association, or corporation, who
(b) A person that, as owner or lessor or as attorney-in-fact,
acting under a duly executed and recorded power of attorney from
the
owner or lessor, or who that
has been appointed by a court,
performs an act as a real estate broker or real estate salesperson
with
reference to property owned by it, the owner of lessor, unless
performed as a principal vocation and not through a licensed real
estate broker.
(c) (2)
This article shall not include the services Services
rendered
by an attorney at law as an attorney at law. , nor shall
it
include a
(d) A receiver, trustee in bankruptcy, administrator,
executor,
a person selling real estate under order of a court, nor
a
or trustee selling under a deed of trust. This
exemption of a
trustee
shall does not apply to repeated or successive sales of
real estate by the trustee, unless the sale is made through a
licensed real estate broker.
(e) (3)
This article does not apply to a A
person who that is
regulated under the mortgage brokers, lenders, and servicers
licensing
act, Act No. 173 of the Public Acts of 1987, being
sections
445.1651 to 445.1683 of the Michigan Compiled Laws, 1987
PA
173, MCL 445.1651 to 445.1684, and who
that does not perform any
other act requiring a license as a real estate broker, associate
broker, or real estate salesperson.
(f) An individual who for compensation or other valuable
consideration is employed either directly or indirectly by a
licensed real estate broker to engage in residential property
management.
(g) An affiliated company of an owner or lessor that performs
residential property management for that owner or lessor.
(4)
For the purposes of this article, "negotiate the mortgage
of
real estate" as described in section 2501, means engaging in
activity
not regulated under Act No. 173 of the Public Acts of
1987.
Sec.
2505. (1) An applicant for A
person applying for a real
estate
broker's license shall file an application setting forth
with the department. All of the following apply to an application
for a real estate broker's license:
(a)
The application must include the
applicant's present
address,
both of business and current
business address; if the
applicant is an individual, the address of his or her residence;
and the complete address of each former place where the applicant
has
resided or been was engaged
in business, or acted as a real
estate salesperson, for a period of 60 days or more, during the 5
years
immediately preceding the date of application. An applicant
for
a real estate broker's license shall state
(b)
The application must include the name
of the individual,
sole
proprietorship, partnership, association, corporation, limited
liability
company, common law trust, or a combination of those
entities
and person that is the
proposed licensee, the location of
the
place for which the license is desired, sought, and set forth
the period of time in which the applicant has been engaged in the
business.
The application shall be executed by the person,
(c) The application must be submitted on a form provided by
the department under section 202 or 204 and executed by the
applicant, if the applicant is an individual, or by an officer or
member
of the applicant if the applicant
is not an individual. An
applicant
for a real estate broker's license which is a
partnership,
association, corporation, limited liability company,
common
law trust, or a combination of those entities
(d) If the applicant is not an individual, the application
shall designate which individuals who are officers or members of
the
partnership, association, limited liability company, or
corporation
applicant will be performing acts regulated by this
article as its principals.
(2) The department shall not issue a real estate broker's
license
to a new applicant who that
has been convicted of
embezzlement or misappropriation of funds.
(3) A real estate broker shall maintain a place of business in
this
state. If All of the
following apply if a real estate broker
maintains
more than 1 place of business within the state, in this
state:
(a) The real estate broker shall obtain a branch office
license
shall be secured by the real estate broker for each branch
office maintained by the broker. As used in this subdivision,
"branch office" does not include an office in which the broker is
engaged solely in residential property management.
(b)
A branch office maintained in excess
of located more thatn
25 miles from the city limits in which the broker maintains a main
office shall be under the personal, direct supervision of an
associate broker.
(4)
An applicant application for a salesperson's license shall
set
forth state the period of time during which the individual has
been
engaged in the business , stating and state the name of the
applicant's last employer and the name and the place of business of
the
individual, partnership, association, limited liability
company,
corporation, common law trust, or combination of those
entities
then employing person that
employs or will employ the
applicant. or
in whose employ the applicant is to enter. The
application
shall be signed by the real estate broker in whose that
will
employ the applicant. is
to enter.
(5) Before issuing a license, the department may require and
procure satisfactory proof of the business experience, competence,
and good moral character of an applicant for a real estate broker's
or salesperson's license, or of an officer or member of an
applicant if the applicant is not an individual. The department
shall require that an applicant for a broker's or salesperson's
license
to pass an examination developed by the department or
contracted for with a recognized outside testing agency
establishing,
that establishes, in a manner satisfactory to the
department, that the applicant has a fair knowledge of the English
language, including reading, writing, spelling, and elementary
arithmetic; a satisfactory understanding of the fundamentals of
real estate practice and of the laws and principles of real estate
conveyancing, deeds, mortgages, land contracts, and leases; the
obligations of a broker to the public and a principal of the
broker; and the law defining, regulating, and licensing real estate
brokers and salespersons.
(6) The department may require written examination or written
reexamination of a broker, or an officer or member of the broker if
the
broker is not an individual, or of a salesperson,
and in that
case
if the department does
require a written examination or
reexamination under this subsection, the department shall not
relicense the broker or salesperson unless the individual taking
the examination or reexamination achieves a passing score
satisfactory
to the department. is required as a condition
precedent
to relicensure of a broker or salesperson.
(7) The department shall require proof that each applicant for
a real estate broker's license has the equivalent of 3 years of
full-time experience in the business of real estate or in a field
that is determined by the department to be relevant and related to
the business of real estate.