SENATE AMENDED
PRIOR PRINTER'S NOS. 1759, 1795, 2001, PRINTER'S NO. 2679
2060, 2500
No. 1448 Session of 1983
INTRODUCED BY MURPHY, IRVIS, MANDERINO, LLOYD, McMONAGLE,
OLIVER, LINTON, SEVENTY, MRKONIC, RIEGER, McINTYRE,
MICHLOVIC, VAN HORNE, CLARK AND TRUMAN, SEPTEMBER 19, 1983
SENATOR TILGHMAN, APPROPRIATIONS, IN SENATE, RE-REPORTED AS
AMENDED, MARCH 19, 1984
AN ACT
1 Amending the act of February 19, 1980 (P.L.15, No.9), entitled
2 "An act establishing the State Real Estate Commission and
3 providing for the licensing of real estate brokers and
4 salesmen," adding and amending definitions; creating,
5 empowering and governing a commission; eliminating
6 confidentiality requirements; changing hours of study and
7 specifying areas of study for applicants; eliminating fee
8 requirements; imposing reporting duties on the Pennsylvania
9 Human Relations Commission; adding a prohibition; broadening
10 the scope of regulation of promotional sales and requiring
11 public accounting for promotional sales; requiring
12 contractual disclosures; regulating reinstatement of revoked
13 licenses; changing limits of liability and increasing
14 assessments for the recovery fund; requiring statements as to
15 the fair market value and odds of receiving any prize in
16 relation to certain offerings of real property; establishing <--
17 a study committee; making editorial changes; and making
18 repeals.
19 The General Assembly of the Commonwealth of Pennsylvania
20 hereby enacts as follows:
21 Section 1. Section 201 of the act of February 19, 1980
22 (P.L.15, No.9), known as the Real Estate Licensing and
23 Registration Act, amended March 7, 1982 (P.L.158, No.50), is
24 amended to read:
1 Section 201. Definitions.
2 The following words and phrases when used in this act shall
3 have, unless the context clearly indicates otherwise, the
4 meanings given to them in this section:
5 "Associate broker." A broker employed by another broker.
6 "Broker." Any person who, for another and for a fee,
7 commission or other valuable consideration:
8 (1) negotiates with or aids any person in locating or
9 obtaining for purchase [or], lease or acquisition of interest
10 in any real estate;
11 (2) negotiates the listing, sale, purchase, exchange,
12 lease, time share and similarly designated interests,
13 financing or option for any real estate;
14 (3) manages or appraises any real estate;
15 (4) represents himself as a real estate consultant,
16 counsellor, house finder;
17 (5) undertakes to promote the sale, exchange, purchase
18 or rental of real estate: Provided, however, That this
19 provision shall not include any person whose main business is
20 that of advertising, promotion or public relations; or
21 (6) attempts to perform any of the above acts.
22 ["Broker of record." A sole proprietor or principal
23 individual broker of a licensed corporation, partnership or
24 association or other entity, foreign or domestic.]
25 "Builder-owner salesperson." Any person who is a full-time
26 employee of a builder-owner of single and multifamily dwellings
27 located within the Commonwealth and as such employee shall be
28 authorized and empowered to list for sale, sell or offer for
29 sale, or to negotiate the sale or exchange of real estate, or to
30 lease or rent, or offer to lease, rent or place for rent, any
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1 real estate owned by his builder-owner employer, or collect or
2 offer, or attempt to collect, rent for the use of real estate
3 owned by his builder-owner employer, for and on behalf of such
4 builder-owner employer. The term does not include any person
5 employed by an owner of real estate for the purpose of managing
6 or maintaining multifamily residential property: Provided,
7 however, That such person is not authorized or empowered by such
8 owner to enter into leases on behalf of the owner, to negotiate
9 terms or conditions of occupancy with current or prospective
10 tenants, or to hold money belonging to tenants other than on
11 behalf of the owner. The term "negotiate," as used in this
12 definition does not mean the transmission of information between
13 the owner and current or prospective tenants, such as rental
14 amounts, building rules and regulations or leasing
15 determinations, so long as the owner retains the authority to
16 make all such decisions.
17 "Cemetery." A place for the disposal or burial of deceased
18 human beings, by cremation or in a grave, mausoleum, vault,
19 columbarium or other receptacle, but the term does not include a
20 private family cemetery.
21 "Cemetery company." Any person who offers or sells to the
22 public the ownership, or the right to use, any cemetery lot.
23 "Commission." The State Real Estate Commission.
24 "Commissioner." Commissioner of Professional and
25 Occupational Affairs.
26 "Department." The Department of State acting through the
27 Commissioner of Professional and Occupational Affairs.
28 "Employ, employed, employee, employment." The use of the
29 words employ, employed, employee or employment in this act shall
30 apply to the relationship of independent contractor as well as
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1 to the relationship of employment, except as applied to builder-
2 owner salespersons.
3 "Limited broker." Any person[, partnership, association or
4 corporation] engaging in or carrying on the business or act in
5 the capacity of a broker within the Commonwealth exclusively
6 within the limited field or branch of business which applies to
7 cemetery lots, plots and mausoleum spaces or openings.
8 "Limited salesperson." Any person employed by a broker or
9 limited broker to perform duties as defined herein under
10 "limited broker". No person employed by a broker to perform
11 duties other than those activities as defined herein under
12 "limited broker" shall be required to be licensed as a limited
13 salesperson.
14 "Person." Any individual, corporation, partnership,
15 association or other entity foreign or domestic.
16 "Real estate." Any interest or estate in land, whether
17 corporeal, incorporeal, freehold or nonfreehold, whether the
18 land is situated in this Commonwealth or elsewhere including
19 leasehold interests and time share and similarly designated
20 interests. A SALE OF A MOBILE HOME SHALL BE DEEMED TO BE A <--
21 TRANSFER OF AN INTEREST IN REAL ESTATE IF ACCOMPANIED BY THE
22 ASSIGNMENT OF THE LEASE OR SALE OF THE LAND ON WHICH THE MOBILE
23 HOME IS SITUATED.
24 "Rental listing referral agent." Any person who owns or
25 manages a business which collects rental information for the
26 purpose of referring prospective tenants to rental units or
27 locations of such units. The term "rental listing referral
28 agent" shall not include any employee or official of any public
29 housing authority created pursuant to State or Federal law.
30 "Salesperson." Any person employed by a licensed real estate
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1 broker to list for sale, sell or offer for sale, to buy or offer
2 to buy or to negotiate the purchase or sale or exchange of real
3 estate or to negotiate a loan on real estate or to lease or rent
4 or offer to lease, rent or place for rent any real estate or
5 collect or offer or attempt to collect rent for the use of real
6 estate for or in behalf of such real estate broker. No person
7 employed by a broker to perform duties other than those
8 activities as defined herein under "broker" shall be required to
9 be licensed as a salesperson.
10 "School." Any person[, corporation, partnership, association
11 or other entity, foreign or domestic, which] who conducts
12 classes in real estate subjects[,] but [which] is not a college
13 [or], university or institute of higher learning duly accredited
14 by the Middle States Association of Colleges and Secondary
15 Schools or equivalent accreditation.
16 "Time share." The right, however evidenced, to use or occupy
17 a dwelling unit held in fee simple or by lease according to an
18 arrangement allocating use and occupancy rights between other
19 similar users.
20 Section 2. The act is amended by adding a section to read:
21 Section 202. State Real Estate Commission.
22 (a) The State Real Estate Commission is hereby created and
23 shall consist of the Commissioner of Professional and
24 Occupational Affairs; the Director of the Bureau of Consumer
25 Protection, or his designee; three members who shall be persons
26 representing the public-at-large; five other persons, each of
27 whom shall at the time of his appointment be a licensed and
28 qualified real estate broker under the existing law of this
29 Commonwealth, and shall have been engaged in the real estate
30 business in this Commonwealth for a period of not less than ten
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1 years immediately prior to his appointment; and one other person
2 who shall have been licensed as a real estate broker, or limited
3 real estate broker, for a period of at least five years and
4 shall have been engaged in selling cemetery lots for at least
5 ten years immediately prior to his appointment. Each of said
6 members of the commission shall be appointed by the Governor.
7 (b) The term of office of each of said members shall be five
8 years from his appointment, or until his successor has been
9 appointed and qualified but not longer than six months beyond
10 the five-year period. In the event that any of said members
11 shall die or resign during his term of office his successor
12 shall be appointed in the same way and with the same
13 qualifications as above set forth and shall hold office for the
14 unexpired term.
15 (c) Six members of the commission shall constitute a quorum.
16 The commission shall elect a secretary from among its members. A
17 commission member who fails to attend three consecutive meetings
18 shall forfeit his seat unless the Commissioner of Professional
19 and Occupational Affairs, upon written request from the member,
20 finds that the member should be excused from a meeting because
21 of illness or the death of a family member.
22 (d) Each member of the commission other than the
23 Commissioner of Professional and Occupational Affairs shall
24 receive actual traveling expenses REIMBURSEMENT FOR REASONABLE <--
25 EXPENSES IN ACCORDANCE WITH COMMONWEALTH REGULATIONS and per
26 diem compensation at the rate of $60 per day for the time
27 actually devoted to the business of the commission.
28 (e) In addition to regularly scheduled meetings of the
29 commission, there shall be at least one public meeting each year
30 in Pittsburgh, one public meeting each year in Philadelphia and
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1 one public meeting each year in Harrisburg. AT LEAST 15 DAYS <--
2 PRIOR TO THE HOLDING OF ANY PUBLIC MEETING PURSUANT TO THIS
3 SUBSECTION, THE COMMISSION SHALL GIVE PUBLIC NOTICE OF THE
4 MEETING IN A NEWSPAPER OF GENERAL CIRCULATION IN EACH OF THE
5 AREAS WHERE THE PUBLIC MEETING IS TO BE HELD. The purpose of
6 these special meetings shall be to solicit from members of the
7 public suggestions, comments and objections about real estate
8 practice in this Commonwealth.
9 Section 3. Sections 301, 303 and 304 of the act, amended
10 March 7, 1982 (P.L.158, No.50), are amended to read:
11 Section 301. Unlawful to conduct business without license or
12 registration certificate.
13 [From and after the effective date of this act, it] It shall
14 be unlawful for any person, directly or indirectly, to engage in
15 or conduct, or to advertise or hold himself out as engaging in
16 or conducting the business, or acting in the capacity of a
17 broker or salesperson, limited broker, limited salesperson,
18 builder-owner salesperson, rental listing referral agent or
19 cemetery company within this Commonwealth without first being
20 licensed or registered [as such] as provided in this act, unless
21 he is exempted from obtaining a license or registration
22 certificate under the provisions of section 304.
23 Section 303. Criminal penalties.
24 Any person who shall[, after the effective date of this act,]
25 engage in or carry on the business, or act in the capacity of a
26 broker, salesperson, limited broker, limited salesperson,
27 builder-owner salesperson, rental listing referral agent or
28 cemetery company, within this Commonwealth, without a license or
29 registration certificate, or shall carry on or continue business
30 after the suspension or revocation of any such license or
19830H1448B2679 - 7 -
1 registration certificate issued to him, or shall employ any
2 person as a salesperson or limited salesperson to whom a license
3 has not been issued, or whose license or registration
4 certificate as such shall have been revoked or suspended, shall
5 be guilty of a summary offense and upon conviction thereof for a
6 first offense shall be sentenced to pay a fine not exceeding
7 $500 or suffer imprisonment, not exceeding three months, or both
8 and for a second or subsequent offense shall be guilty of a
9 felony of the third degree and upon conviction thereof, shall be
10 sentenced to pay a fine of not less than $2,000 but not more
11 than $5,000 or to imprisonment for not less than one year but
12 not more than two years, or both.
13 Section 304. Exclusions.
14 [The provisions of this act shall not apply to an owner of
15 real estate with respect to property owned or leased by such
16 owner, provided that in the case of a partnership or
17 corporation, this exclusion shall not extend to more than five
18 of its partners or officers, respectively, but to no other
19 partnership or corporation personnel or employee, except the
20 employees of a public utility acting in the ordinary course of
21 utility related business under the provisions of Title 66 of the
22 Pennsylvania Consolidated Statutes (relating to public
23 utilities), with respect to negotiating the purchase, sale or
24 lease of property, nor shall this act apply to officers or
25 employees of a partnership or corporation whose principal
26 business is the discovery, extraction, distribution or
27 transmission of energy or mineral resources, provided that the
28 purchase, sale or lease of real estate is a common and necessary
29 transaction in the conduct of such principal business; nor shall
30 this act be construed to include in any way the services
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1 rendered by an attorney in fact under a duly executed and
2 recorded power of attorney from the owner or lessor (provided
3 such power of attorney is not utilized to circumvent the intent
4 of this act); nor by an attorney at law, nor shall it be held to
5 include a person acting as receiver, trustee in bankruptcy,
6 administrator, executor, trustee or guardian while acting under
7 a court order or under the authority of a will or of a trust
8 instrument, nor shall this act apply to the duly elected officer
9 of any banking institution or trust company operating under
10 Federal or State banking laws where real estate of the banking
11 institution or trust company only is involved, nor shall they be
12 held to include any officer or employee of a cemetery company
13 who, as incidental to his principal duties and without
14 remuneration therefor, shows lots in such company's cemetery to
15 persons for their use as a family burial lot, and who accepts
16 deposits on such lots for the representatives of the cemetery
17 company, legally authorized to sell the same, nor shall it apply
18 to cemetery companies and cemeteries owned or controlled by a
19 bona fide church or religious congregation or fraternal
20 organization or by any association created by a bona fide church
21 or religious organization or by a fraternal organization, nor
22 shall it be held to include any properly licensed auctioneer,
23 under statutes of this State, while performing authorized duties
24 at any bona fide auction.] Except as otherwise provided in this
25 act, the provisions of this act shall not apply to the
26 following:
27 (1) An owner of real estate with respect to property
28 owned or leased by such owner. In the case of a partnership
29 or corporation, this exclusion shall not extend to more than
30 five of its partners or officers, respectively nor to other
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1 partnership or corporation personnel or employees.
2 (2) The employees of a public utility acting in the
3 ordinary course of utility related business under the
4 provisions of Title 66 of the Pennsylvania Consolidated
5 Statutes (relating to public utilities), with respect to
6 negotiating the purchase, sale or lease of property.
7 (3) The officers or employees of a partnership or
8 corporation whose principal business is the discovery,
9 extraction, distribution or transmission of energy or mineral
10 resources, provided that the purchase, sale or lease of real
11 estate is a common and necessary transaction in the conduct
12 of such principal business.
13 (4) The services rendered by an attorney in fact under
14 an executed and recorded power of attorney from the owner or
15 lessor (provided such power of attorney is not utilized to
16 circumvent the intent of this act) or by an attorney at law.
17 (5) A person acting as trustee in bankruptcy,
18 administrator, executor, trustee or guardian while acting
19 under a court order or under the authority of a will or of a
20 trust instrument.
21 (6) The elected officer of any banking institution or
22 trust company operating under Federal or State banking laws
23 where only the real estate of the banking institution or
24 trust company is involved.
25 (7) Any officer or employee of a cemetery company who,
26 as incidental to his principal duties and without
27 remuneration therefor, shows lots in such company's cemetery
28 to persons for their use as a family burial lot and who
29 accepts deposits on such lots for the representatives of the
30 cemetery company legally authorized to sell the same.
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1 (8) Cemetery companies and cemeteries owned or
2 controlled by a bona fide church or religious congregation or
3 fraternal organization or by any association created by a
4 bona fide church or religious organization or by a fraternal
5 organization.
6 (9) An auctioneer licensed under the act of September
7 29, 1961 (P.L.1745, No.709), known as "The Auctioneers'
8 License Act," while performing authorized duties at any bona
9 fide auction.
10 Section 4. The act is amended by adding a section to read:
11 Section 305. Civil penalty.
12 In addition to any other civil remedy or criminal penalty
13 provided for in this act, the commission may levy a civil <--
14 penalty of up to $1,000 on any person who engages in the
15 practice of real estate without being properly licensed to do so
16 under this act. The board, BY A VOTE OF THE MAJORITY OF THE <--
17 MAXIMUM NUMBER OF THE AUTHORIZED MEMBERSHIP OF THE COMMISSION AS
18 PROVIDED BY LAW, OR BY A VOTE OF THE MAJORITY OF THE DULY
19 QUALIFIED AND CONFIRMED MEMBERSHIP OR A MINIMUM OF FIVE MEMBERS,
20 WHICHEVER IS GREATER, MAY LEVY A CIVIL PENALTY OF UP TO $1,000
21 ON ANY CURRENT LICENSEE WHO VIOLATES ANY PROVISION OF THIS ACT
22 OR ON ANY PERSON WHO PRACTICES REAL ESTATE WITHOUT BEING
23 PROPERLY LICENSED TO DO SO UNDER THIS ACT. THE COMMISSION shall
24 levy this penalty only after affording the accused party the
25 opportunity for a hearing, as provided in Title 2 of the
26 Pennsylvania Consolidated Statutes (relating to administrative
27 law and procedure).
28 Section 5. Section 401 of the act, amended March 7, 1982
29 (P.L.158, No.50), is amended to read:
30 Section 401. Duty to issue licenses and registration
19830H1448B2679 - 11 -
1 certificates.
2 (a) It shall be the duty of the department to issue licenses <--
3 and registration certificates to [individuals, copartnerships
4 and corporations,] any person who shall comply with the
5 provisions of this act.
6 (b) The department shall establish a special ad hoc <--
7 committee charged to undertake a study of third-party brokerage
8 activities. It shall make specific inquiry into those
9 transactions wherein a real estate entity transacts in an agency
10 capacity for residential real property as a licensee under the
11 Real Estate Licensing and Registration Act, and makes first lien
12 residential real estate loans as well, for the purchase of such
13 property, either by itself, through an affiliate, or both, and
14 whether existing law or regulations affecting these entities
15 adequately safeguard the interests of Pennsylvania consumers for
16 available competitive housing financing within this
17 Commonwealth. The special committee shall be known as the Third
18 Party Real Estate Brokerage Ad Hoc Review Committee. The members
19 of the committee shall consist of the Secretary of Banking, the
20 Commissioner of Professional and Occupational Affairs and the
21 Chairman of the Pennsylvania Securities Commission. It shall
22 also include the Majority and Minority Chairmen of the Business
23 and Commerce Committee or their designees and Professional
24 Licensure Committee of the House of Representatives, the
25 Majority and Minority Chairmen of the Banking and Insurance
26 Committee or their designees and the Consumer Protection and
27 Professional Licensure Committee of the Senate. The committee
28 shall proceed with all due diligence and report its findings to
29 this session of the General Assembly within three months of the
30 effective date of this act.
19830H1448B2679 - 12 -
1 Section 6. Section 404 of the act, repealed in part June 25,
2 1982 (P.L.633, No.181), is amended to read:
3 Section 404. Power to promulgate regulations.
4 [(a)] The commission shall have the power to promulgate
5 rules or regulations in order to administer and effectuate the
6 purposes of this act. All existing rules or regulations [adopted
7 pursuant to the act of May 1, 1929 (P.L.1216, No.427), known as
8 the "Real Estate Brokers License Act of one thousand nine
9 hundred and twenty-nine,"] shall remain in full force and effect
10 until modified by the commission.
11 Section 7. Section 405 of the act is repealed.
12 Section 8. The act is amended by adding sections to read:
13 Section 407. Fees.
14 (a) All fees required under this act shall be fixed by the
15 commission, by regulation and shall be subject to review in
16 accordance with the act of June 25, 1982 (P.L.633, No.181),
17 known as the "Regulatory Review Act." If the projected revenues
18 to be generated by fees, fines and civil penalties imposed in
19 accordance with the provisions of this act are not sufficient to
20 match expenditures over a two-year period, the commission shall
21 increase those fees by regulation, subject to review in
22 accordance with the "Regulatory Review Act," such that the
23 projected revenues will meet or exceed projected expenditures.
24 (b) If the Bureau of Professional and Occupational Affairs
25 determines that the fees established by the commission are
26 inadequate to meet the minimum enforcement efforts required,
27 then the bureau, after consultation with the commission, shall
28 increase the fees by regulation, subject to review in accordance
29 with the "Regulatory Review Act," so that adequate revenue is
30 raised to meet the required enforcement effort.
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1 Section 408. Reports to legislative committees.
2 (a) The commission shall submit annually a report to the
3 Professional Licensure Committee of the House of Representatives
4 and to the Consumer Protection and Professional Licensure
5 Committee of the Senate a description of the types of complaints
6 received, status of cases, board action which has been taken and
7 the length of time from the initial complaint to final board
8 resolution.
9 (b) The commission shall also submit annually to the House
10 of Representatives and the Senate Appropriation Committees, 15
11 days after the Governor has submitted his budget to the General
12 Assembly, an estimate of the financial requirements of the <--
13 commission for its administrative, investigative, legal and
14 miscellaneous expenses. A COPY OF THE BUDGET REQUEST FOR THE <--
15 UPCOMING FISCAL YEAR WHICH THE COMMISSION PREVIOUSLY SUBMITTED
16 TO THE DEPARTMENT.
17 Section 9. Sections 501, 511, 512, 521 and 532 of the act
18 are amended to read:
19 Section 501. Reputation; inactive licensee; revoked license.
20 (a) Licenses shall be granted only to and renewed only for
21 persons who bear a good reputation for honesty, trustworthiness,
22 integrity and competence to transact the business of broker,
23 salesperson, limited broker, limited salesperson, builder-owner
24 salesperson or rental listing referral agent, in such manner as
25 to safeguard the interest of the public, and only after
26 satisfactory proof of such qualifications has been presented to
27 the commission as it shall by regulation require.
28 (b) Any person who remains inactive for a period of five
29 years without renewing his license shall, prior to having a
30 license reissued to him, submit to and pass [an] the examination
19830H1448B2679 - 14 -
1 pertinent to the license for which the person is reapplying.
2 (c) Unless ordered to do so by a court COMMONWEALTH COURT, <--
3 the commission shall not reinstate the license, within five
4 years of the date of revocation, of any person whose license has
5 been revoked under this act. Any person whose license has been
6 revoked may reapply for a license at the end of the five-year
7 period but must meet all of the licensing qualifications of this
8 act for the license applied for, to include the examination
9 requirement.
10 Section 511. Qualifications for license.
11 The applicant for a broker's license, shall as a condition
12 precedent to obtaining a license, take the broker's license
13 examination and score a passing grade. Prior to taking the
14 examination:
15 (1) The applicant shall be at least 21 years of age.
16 (2) The applicant shall be a high school graduate or
17 shall produce proof satisfactory to the commission of an
18 education equivalent thereto.
19 (3) The applicant shall have completed [16 semester
20 credit hours of 15] 240 hours [each] in real estate
21 instruction in areas of study prescribed by the rules of the
22 commission, which rules shall require instruction in the
23 areas of fair housing and professional ethics.
24 (4) The applicant shall have been engaged [full time] as
25 a [sales person] licensed real estate salesperson for at
26 least three years or possess educational or experience
27 qualifications which the commission deems to be the
28 equivalent thereof.
29 Section 512. Application for license.
30 (a) An application for a license as real estate broker shall
19830H1448B2679 - 15 -
1 be made in writing, to the department, upon a form provided for
2 the purpose by the department and shall contain such information
3 as to the applicant as the commission shall require.
4 [(b) The application shall be accompanied by two photographs
5 of the applicant or in the case of a copartnership, association
6 or corporation of the applicant members or officers thereof.
7 (c)] (b) The application shall state the place of business
8 for which such license is desired.
9 [(d)] (c) The application shall be received by the
10 commission within three years of the date upon which the
11 applicant took the examination.
12 Section 521. Qualifications for license.
13 Each applicant shall as a condition precedent to obtaining a
14 license, take the salesperson license examination and score a
15 passing grade. Prior to taking the examination:
16 (1) The applicant shall be at least 18 years of age.
17 (2) The applicant shall have completed [four semester
18 credit hours of 15] 60 hours [each] in real estate
19 instruction in areas of study prescribed by the rules of the
20 commission, which rules shall require instruction in the
21 areas of fair housing and professional ethics.
22 Section 532. Application for license.
23 (a) An application for a license as a limited broker shall
24 be made, in writing, to the department, upon a form provided for
25 the purpose by the department and shall contain such information
26 as to the applicant, as the commission shall require.
27 (b) The applicant shall have completed [four semester credit
28 hours of 15] 60 hours [each] in real estate instruction in areas
29 of study prescribed by the rules of the commission, which rules
30 shall require instruction in the area of professional ethics.
19830H1448B2679 - 16 -
1 (c) The application shall be received by the commission
2 within three years of the date upon which the applicant took the
3 examination.
4 Section 10. Section 571 of the act, added March 7, 1982
5 (P.L.158, No.50), is amended to read:
6 Section 571. Application and fee for registration certificate.
7 [(a)] An application for a registration certificate for a
8 cemetery company to operate a cemetery shall be made, in writing
9 to the department, upon a form provided for the purpose by the
10 department, and shall contain such information as to the
11 applicant as the commission shall require.
12 [(b) (1) The fee for application and initial biennial
13 registration as a cemetery company shall be $25 which shall
14 be paid at the time of application and which shall be
15 nonrefundable.
16 (2) The biennial fee for the renewal of a cemetery
17 company registration certificate shall be $25.
18 (3) The fees established in this subsection shall be
19 subject to the act of July 1, 1978 (P.L.700, No.124), known
20 as the "Bureau of Professional and Occupational Affairs Fee
21 Act," in the same manner as other fees of the commission.]
22 Section 11. Sections 601, 602 and 603 of the act are amended
23 to read:
24 Section 601. Duty of brokers and limited brokers to maintain
25 office.
26 (a) Each resident licensed broker (which term in this
27 section shall include limited broker) shall maintain a fixed
28 office within this Commonwealth. The [original] CURRENT license <--
29 of a broker and of each licensee employed by such broker shall
30 be prominently displayed in an office of the broker. The address
19830H1448B2679 - 17 -
1 of the office shall be designated on the current [renewal form]
2 license. In case of removal of a broker's office from the
3 designated location, all licensees registered at that location
4 shall make application to the commission before such removal or
5 within ten days thereafter, designating the new location of the
6 office, and shall pay the required fees, whereupon the
7 commission shall issue a [renewal form] current license at the
8 new location for the unexpired period, if the new location
9 complies with the terms of this act. Each licensed broker shall
10 maintain a sign on the outside of his office indicating the
11 proper licensed brokerage name.
12 (b) If the applicant for a broker's license intends to
13 maintain more than one place of business within the
14 Commonwealth, he shall apply for and obtain an additional
15 license in his name at each [branch] office. Every such
16 application shall state the location of such [branch] office.
17 Effective 24 months after the effective date of this act, each
18 [branch] office shall be under the direction and supervision of
19 a manager who is either the broker [of record] or an associate
20 broker: Provided, however, That such broker [of record] or an
21 associate broker may direct and supervise more than one [branch]
22 office.
23 Section 602. Nonresident licensees.
24 [(a) A nonresident of this Commonwealth may be licensed as a
25 broker or a salesperson, upon complying with all provisions and
26 conditions as promulgated by the commission.
27 (b) In connection with the application of a nonresident of
28 this Commonwealth for a license as broker or salesperson, the
29 commission may accept, in lieu of the recommendations and
30 statements otherwise required to accompany the application for
19830H1448B2679 - 18 -
1 such licensure, the license as broker or salesperson issued to
2 such applicant by the proper authority of the state of his
3 licensure. In such case the licensee need not maintain a place
4 of business within this Commonwealth. It is hereby expressly
5 stipulated, that the provisions of this subsection shall apply
6 to licensed brokers and salespersons of those states under the
7 laws of which similar recognition and courtesies are extended to
8 licensed brokers and salespersons of this Commonwealth.] Any
9 nonresident of this Commonwealth who meets the equivalent
10 experience requirements and other standards and qualifications,
11 as the commission shall by rule provide, shall qualify for a
12 license under this act.
13 Section 603. Employment of associate brokers, salesperson.
14 No associate broker or salesperson (which term in this
15 section shall include limited salesperson) shall be employed by
16 any other broker than is designated upon the [renewal form]
17 current license issued to said associate broker or said
18 salesperson. Whenever a licensed salesperson or associate broker
19 desires to change his employment from one licensed broker to
20 another, he shall notify the commission in writing [at least] no
21 later than ten days [prior to] after the intended date of
22 change, pay the required fee, and return his current [renewal]
23 license. The commission, shall, upon receipt of acknowledgment
24 from the new broker[,] of the change of employment [forthwith]
25 issue a new [renewal form and pocket card, but in] license. In
26 the interim at such time as the change in affiliation of the
27 salesperson or associate broker occurs, he shall maintain a copy
28 of the notification sent to the [commissioner] commission as his
29 temporary license pending receipt of his [renewal form] new
30 current license. It shall be the duty of the applicant to notify
19830H1448B2679 - 19 -
1 the commission if a new [renewal form] license or other
2 pertinent communication is not received from the commission
3 within 30 days.
4 Section 12. Section 604 of the act, amended March 7, 1982
5 (P.L.158, No.50), is amended to read:
6 Section 604. Prohibited acts.
7 (a) The commission may upon its own motion, and shall
8 promptly upon the verified complaint in writing of any person
9 setting forth a complaint under this section, ascertain the
10 facts and, if warranted, hold a hearing for the suspension or
11 revocation of a license or registration certificate or for the
12 imposition of fines not exceeding [$500] $1,000, OR BOTH. The <--
13 commission shall have power to refuse a license or registration
14 certificate for cause or to suspend or revoke a license or
15 registration certificate or to levy fines up to [$500] $1,000, <--
16 OR BOTH where the said license has been obtained by false
17 representation, or by fraudulent act or conduct, or where a
18 licensee or registrant, in performing or attempting to perform
19 any of the acts mentioned herein, is found guilty of:
20 (1) Making any substantial misrepresentation.
21 (2) Making any false promise of a character likely to
22 influence, persuade or induce any person to enter into any
23 contract or agreement when he could not or did not intend to
24 keep such promise.
25 (3) Pursuing a continued and flagrant course of
26 misrepresentation or making of false promises through
27 salesperson, associate broker, other persons, or any medium
28 of advertising, or otherwise.
29 (4) Any misleading or untruthful advertising, or using
30 any other trade name or insignia or membership in any real
19830H1448B2679 - 20 -
1 estate association or organization, of which the licensee is
2 not a member.
3 (5) Failure to comply with the following requirements:
4 (i) all deposits or other moneys accepted by every
5 person, holding a real estate broker license under the
6 provisions of this act, shall be retained by such real
7 estate broker pending consummation or termination of the
8 transaction involved, and shall be accounted for in the
9 full amount thereof at the time of the consummation or
10 termination;
11 (ii) every salesperson and associate broker promptly
12 on receipt by him of a deposit or other moneys on any
13 transaction in which he is engaged on behalf of his
14 broker-employer, shall pay over the deposit to the
15 broker;
16 (iii) a broker shall not commingle the money or
17 other property of his principal with his own;
18 (iv) every broker shall immediately deposit such
19 moneys, of whatever kind or nature, belonging to others,
20 in a separate custodial or trust fund account maintained
21 by the broker with some bank or recognized depository
22 until the transaction involved is consummated or
23 terminated, at which time the broker shall account for
24 the full amount received. Under no circumstances shall a
25 broker permit any advance payment of funds belonging to
26 others to be deposited in the broker's business or
27 personal account, or to be commingled with any funds he
28 may have on deposit; or
29 (v) every broker shall keep records of all funds
30 deposited therein, which records shall indicate clearly
19830H1448B2679 - 21 -
1 the date and from whom he received money, the date
2 deposited, the dates of withdrawals, and other pertinent
3 information concerning the transaction, and shall show
4 clearly for whose account the money is deposited and to
5 whom the money belongs. All such records and funds shall
6 be subject to inspection by the commission. Such separate
7 custodial or trust fund account shall designate the
8 broker, as trustee, and such account must provide for
9 withdrawal of funds without previous notice. All such
10 records shall be available to the commission, or its
11 representatives, immediately after proper demand or after
12 written notice given, or upon written notice given to the
13 depository.
14 (6) Failing to preserve for three years following its
15 consummation records relating to any real estate transaction.
16 (7) Acting for more than one party in a transaction
17 without the knowledge and consent in writing of all parties
18 for whom he acts.
19 (8) Placing a "for sale" or "for rent" sign on any
20 property without the written consent of the owner, or his
21 authorized agent.
22 (9) Failing to voluntarily furnish a copy of any
23 listing, sale, lease, or other contract relevant to a real
24 estate transaction to all signatories thereof at the time of
25 execution.
26 (10) Failing to specify a definite termination date that
27 is not subject to prior notice, in any listing contract.
28 (11) Inducing any party to a contract, sale or lease to
29 break such contract for the purpose of substitution in lieu
30 thereof of a new contract, where such substitution is
19830H1448B2679 - 22 -
1 motivated by the personal gain of the licensee.
2 (12) Accepting a commission or any valuable
3 consideration by a salesperson or associate broker for the
4 performance of any acts specified in this act, from any
5 person, except the licensed real estate broker with whom he
6 is affiliated.
7 (13) Failing to disclose to an owner in writing his
8 intention or true position if he directly or indirectly
9 through a third party, purchased for himself or acquires or
10 intends to acquire any interest in or any option to purchase
11 property which has been listed with his office to sell or
12 lease.
13 (14) Being convicted in a court of competent
14 jurisdiction [of] in this or any other state, or Federal
15 court, of forgery, embezzlement, obtaining money under false
16 pretenses, bribery, larceny, extortion, conspiracy to
17 defraud, or any similar offense or offenses, or any felony or
18 pleading guilty or nolo contendere to any such offense or
19 offenses.
20 (15) Violating any rule or regulation promulgated by the
21 commission in the interest of the public and consistent with
22 the provisions of this act.
23 (16) In the case of a broker licensee, failing to
24 exercise adequate supervision over the activities of his
25 licensed salespersons or associate brokers within the scope
26 of this act.
27 (17) Failing, within a reasonable time as defined by the
28 commission, to provide information requested by the
29 commission as the result of a formal or informal complaint to
30 the commission, which would indicate a violation of this act.
19830H1448B2679 - 23 -
1 (18) Soliciting, selling or offering for sale real
2 property by offering free lots, or conducting lotteries or
3 contests or offering prizes for the purpose of influencing by
4 deceptive conduct any purchaser or prospective purchaser of
5 real property. The commission shall promulgate necessary
6 rules and regulations to provide standards for nondeception
7 conduct under this paragraph. Any offering by mail or by
8 telephone of any prize in relation to the offering of sale of
9 real property, including time sharing, shall be accompanied
10 by a statement of the fair market value, not suggested retail
11 price, of all prizes offered, plus a statement of the odds of
12 receiving any such prize. If the offering is by mail the
13 statement of value and odds shall be printed in the same size
14 type as the prize description and shall appear immediately
15 adjacent to said description.
16 (19) Paying or accepting, giving or charging any
17 undisclosed commission, rebate, compensation or profit or
18 expenditures for a principal, or in violation of this act.
19 (20) Any conduct in a real estate transaction which
20 demonstrates bad faith, dishonesty, untrustworthiness, or
21 incompetency.
22 (21) Performing any act for which an appropriate real
23 estate license is required and is not currently in effect.
24 (22) Violating any provision of the act of October 27,
25 1955 (P.L.744, No.222), known as the "Pennsylvania Human
26 Relations Act," or any order or consent decree of the
27 Pennsylvania Human Relations Commission issued pursuant to
28 such act if such order or consent decree resulted from a
29 complaint of discrimination in the area of activities
30 authorized by virtue of this act.
19830H1448B2679 - 24 -
1 (i) Such activities include but are not limited to:
2 [(i)] (A) Accepting listings on the understanding
3 that illegal discrimination in the sale or rental of
4 housing is to be practiced due to race, color, religious
5 creed, sex, ancestry, national origin, physical handicap,
6 disability or use of a guide dog because of blindness of
7 user of a prospective lessee or purchaser.
8 [(ii)] (B) Giving false information for purposes of
9 discrimination in the rental or sale of housing due to
10 race, color, religious creed, sex, ancestry, national
11 origin, physical handicap, disability or use of a guide
12 dog because of blindness of user of a prospective lessee
13 or purchaser.
14 [(iii)] (C) Making distinctions in locations of
15 housing or dates of availability of housing for purposes
16 of discrimination in the rental or sale of such housing
17 due to race, color, religious creed, sex, ancestry,
18 national origin, physical handicap, disability or use of
19 a guide dog because of blindness of user of the
20 prospective lessee or purchaser.
21 (ii) Nothing contained in this paragraph [(22)] is
22 intended to preclude the State Real Estate Commission
23 from conducting its own investigation and maintaining its
24 own file on any complaint of discrimination. The intent
25 hereunder is to allow the Pennsylvania Human Relations
26 Commission a reasonable period of time to conduct its own
27 investigations, hold hearings, render its decisions and
28 inform the State Real Estate Commission of its findings
29 prior to the State Real Estate Commission taking action
30 against any broker, salesperson or sales associate
19830H1448B2679 - 25 -
1 charged with a violation of this paragraph [(22)].
2 (iii) If in the event the Pennsylvania Human
3 Relations Commission does not act on a discrimination
4 complaint within 90 days after it is filed with the
5 Pennsylvania Human Relations Commission then the State
6 Real Estate Commission may proceed with action against
7 such licensee.
8 (iv) The 90-day waiting period delaying State Real
9 Estate Commission action against licensee accused of
10 discrimination applies only in initial complaints against
11 such licensee, second or subsequent complaints may be
12 brought by individuals or the Pennsylvania Human
13 Relations Commission directly to the State Real Estate
14 Commission.
15 (v) The Pennsylvania Human Relations Commission
16 shall notify the State Real Estate Commission of
17 complaints received FINDINGS OF VIOLATIONS by the Human <--
18 Relations Commission against licensees under this act
19 concerning the sale, purchase or lease of real estate in
20 violation of the "Pennsylvania Human Relations Act."
21 (23) In the case of a cemetery company registrant,
22 violating any provisions of Title 9 of the Pennsylvania
23 Consolidated Statutes (relating to burial grounds).
24 (24) In the case of a cemetery company registrant,
25 violating any provisions of the act of August 14, 1963
26 (P.L.1059, No.459), entitled "An act prohibiting future need
27 sales of cemetery merchandise and services, funeral
28 merchandise and services, except under certain conditions;
29 requiring the establishment of and deposit into a merchandise
30 trust fund of certain amount of the proceeds of any such
19830H1448B2679 - 26 -
1 sale; providing for the administration of such trust funds
2 and the payment of money therefrom; conferring powers and
3 imposing duties on orphans' courts, and prescribing
4 penalties."
5 (25) Violating section 606 or 607.
6 (26) Charging or collecting a minimum dollar amount
7 commission.
8 (b) All fines and civil penalties imposed in accordance with
9 section 305 and this section shall be paid into the Professional
10 Licensure Augmentation Account.
11 Section 13. Section 605 of the act is amended to read:
12 Section 605. [Out-of-state] Promotional land sales; approval.
13 (a) [Any person who proposes to engage in [sales]real estate <--
14 transactions of a promotional nature in this Commonwealth for a
15 property located inside or outside of this Commonwealth, shall <--
16 first apply to the commission for its approval before so doing,
17 and they and their [salesmen] salespeople shall comply with such <--
18 rules, regulations, restrictions and conditions pertaining
19 thereto as the commission may impose as well as all those
20 provisions set forth in this act.] <--
21 (b) A commission member may inspect properties on behalf of <--
22 the commission, if it is determined to be necessary by the
23 commission, after review of Federal, State and commission
24 filings required by law and any other relevant information. The
25 chairman shall assign commission members on a rotating basis to
26 inspect promotional properties. Such assignment shall be made at
27 a public meeting held pursuant to the act of July 19, 1974
28 (P.L.486, No.175), referred to as the Public Agency Open Meeting
29 Law.
30 (c) The commission shall charge an application fee for
19830H1448B2679 - 27 -
1 applicants applying to sell promotional properties. Such fee
2 shall be determined by regulation and shall only reflect the
3 administrative costs associated with processing the
4 applications.
5 (d) If the commission has determined that an onsite
6 inspection is necessary, and upon receipt of the filing fee the
7 commission shall send to the developer an estimate of the
8 anticipated expense of the onsite inspection. After the
9 commission has received payment for these expenses the
10 commission shall assign a member of its staff who is not a
11 member of the commission A COMMISSION MEMBER SHALL BE ASSIGNED <--
12 to perform the onsite inspection. Should the actual cost of the
13 inspection differ from the commission's estimate, the developer
14 shall be so notified and the commission shall either assess the
15 amount of the deficiency or remit the amount of the overage,
16 upon or to the developer, as the case may be, within 30 days of
17 the onsite inspection.
18 (e) The commission member who performs the onsite inspection
19 shall not participate in the voting to approve the property.
20 (f) The commission member who performs the onsite inspection
21 shall be reimbursed in accordance with current Commonwealth
22 reimbursement standards. All financial transactions related to
23 onsite inspections shall be a matter of public record. In no
24 case shall the commission member receive any type of
25 reimbursement directly from the developer.
26 (A) ANY PERSON WHO PROPOSES TO ENGAGE IN REAL ESTATE <--
27 TRANSACTIONS OF A PROMOTIONAL NATURE IN THIS COMMONWEALTH FOR A
28 PROPERTY LOCATED INSIDE OR OUTSIDE OF THIS COMMONWEALTH, SHALL
29 FIRST REGISTER WITH THE COMMISSION FOR ITS APPROVAL BEFORE SO
30 DOING, AND SHALL COMPLY WITH SUCH RESTRICTIONS AND CONDITIONS
19830H1448B2679 - 28 -
1 PERTAINING THERETO AS THE COMMISSION MAY IMPOSE BY RULE OR
2 REGULATION. REGISTRATION SHALL NOT BE REQUIRED FOR PROPERTY
3 LOCATED WITHIN OR OUTSIDE OF THIS COMMONWEALTH WHICH IS SUBJECT
4 TO A STATUTORY EXEMPTION UNDER THE FEDERAL INTERSTATE LAND SALES
5 FULL DISCLOSURE ACT, (PUBLIC LAW 90-448, 82 STAT. 590, 15 U.S.C.
6 § 1702).
7 (B) AS USED IN THIS SECTION THE TERM "PROMOTIONAL REAL
8 ESTATE" MEANS AN INTEREST IN PROPERTY AS DEFINED IN THIS ACT
9 WHICH IS A PART OF A COMMON PROMOTIONAL PLAN UNDERTAKEN BY A
10 SINGLE DEVELOPER OR GROUP OF DEVELOPERS ACTING TOGETHER TO OFFER
11 INTERESTS IN REAL ESTATE FOR SALE OR LEASE THROUGH ADVERTISING
12 BY MAIL, NEWSPAPER OR PERIODICAL, BY RADIO, TELEVISION,
13 TELEPHONE OR OTHER ELECTRONIC MEANS WHICH IS CONTIGUOUS, KNOWN,
14 DESIGNATED OR ADVERTISED AS A COMMON UNIT OR BY A COMMON NAME:
15 PROVIDED, HOWEVER, THAT THE TERM SHALL NOT MEAN REAL ESTATE
16 INTEREST INVOLVING LESS THAN 50 LOTS OR SHARES, CEMETERY LOTS
17 AND LAND INVOLVING LESS THAN 25 ACRES.
18 (C) A PERSON MAY APPLY TO THE COMMISSION FOR REGISTRATION OF
19 PROMOTIONAL LAND SALES BY FILING A STATEMENT OF RECORD AND
20 MEETING THE REQUIREMENTS OF THIS SECTION. EACH REGISTRATION
21 SHALL BE RENEWED ANNUALLY. IN LIEU OF REGISTRATION OR RENEWAL,
22 THE COMMISSION SHALL ACCEPT REGISTRATIONS, PROPERTY REPORTS OR
23 SIMILAR DISCLOSURE DOCUMENTS FILED IN OTHER STATES OR WITH THE
24 FEDERAL GOVERNMENT: PROVIDED, THAT THE COMMISSION MAY SUSPEND OR
25 REVOKE THE REGISTRATION WHEN THE FEDERAL GOVERNMENT OR A
26 REGISTERING STATE SUSPENDS OR REVOKES A REGULATION. THE
27 COMMISSION SHALL, BY RULE AND REGULATION, COOPERATE WITH SIMILAR
28 JURISDICTIONS IN OTHER STATES TO ESTABLISH UNIFORM FILING
29 PROCEDURES AND FORMS, PUBLIC OFFERING STATEMENTS AND SIMILAR
30 FORMS. THE COMMISSION SHALL CHARGE AN APPLICATION FEE AS
19830H1448B2679 - 29 -
1 DETERMINED BY REGULATION TO COVER COSTS ASSOCIATED WITH
2 PROCESSING APPLICATIONS FOR REGISTRATIONS AND RENEWALS.
3 (D) UNLESS PRIOR APPROVAL HAS BEEN GRANTED BY THE COMMISSION
4 OR THE PROMOTIONAL PLAN IS CURRENTLY REGISTERED WITH THE
5 DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT PURSUANT TO THE
6 FEDERAL INTERSTATE LAND SALES FULL DISCLOSURE ACT OR PURSUANT TO
7 STATE LAW, THE STATEMENT OF RECORD SHALL CONTAIN THE INFORMATION
8 AND BE ACCOMPANIED BY DOCUMENTS SPECIFIED AS FOLLOWS:
9 (1) THE NAME AND ADDRESS OF EACH PERSON HAVING AN
10 INTEREST IN THE PROPERTY TO BE COVERED BY THE STATEMENT OF
11 RECORD AND THE EXTENT OF SUCH INTEREST, EXCEPT THAT IN THE
12 CASE OF A CORPORATION THE STATEMENT SHALL LIST ALL OFFICERS
13 AND ALL HOLDERS OF 10% OR MORE OF THE SUBSCRIBED OR ISSUED
14 STOCK OF THE CORPORATIONS.
15 (2) A LEGAL DESCRIPTION OF, AND A STATEMENT OF THE TOTAL
16 AREA INCLUDED IN THE PROPERTY AND A STATEMENT OF THE
17 TOPOGRAPHY THEREOF, TOGETHER WITH A MAP SHOWING THE DIVISION
18 PROPOSED AND THE DIMENSIONS OF THE PROPERTY TO BE COVERED BY
19 THE STATEMENT OF RECORD AND THEIR RELATION TO EXISTING
20 STREETS AND ROADS.
21 (3) A STATEMENT OF THE CONDITION OF THE TITLE TO THE
22 LAND COMPRISING THE PROPERTY INCLUDING ALL ENCUMBRANCES,
23 MORTGAGES, JUDGMENTS, LIENS OR UNPAID TAXES AND DEED
24 RESTRICTIONS AND COVENANTS APPLICABLE THERETO.
25 (4) A STATEMENT OF THE GENERAL TERMS AND CONDITIONS,
26 INCLUDING THE RANGE OF SELLING PRICES OR RENTS AT WHICH IT IS
27 PROPOSED TO DISPENSE OF THE PROPERTY.
28 (5) A STATEMENT OF THE PRESENT CONDITION OF ACCESS TO
29 THE PROPERTY, THE EXISTENCE OF ANY UNUSUAL CONDITIONS
30 RELATING TO SAFETY WHICH ARE KNOWN TO THE DEVELOPER,
19830H1448B2679 - 30 -
1 COMPLETED IMPROVEMENTS INCLUDING, BUT NOT LIMITED TO,
2 STREETS, SIDEWALKS, SEWAGE DISPOSAL FACILITIES AND OTHER
3 PUBLIC UTILITIES, THE PROXIMITY IN MILES OF THE SUBDIVISION
4 TO NEARBY MUNICIPALITIES AND THE NATURE OF ANY IMPROVEMENTS
5 TO BE INSTALLED BY THE DEVELOPER AND HIS ESTIMATED SCHEDULE
6 FOR COMPLETION.
7 (6) A STATEMENT OF ANY ENCUMBRANCE, A STATEMENT OF THE
8 CONSEQUENCES FOR THE PURCHASER OF A FAILURE BY THE PERSON OR
9 PERSONS BOUND TO FULFILL OBLIGATIONS UNDER ANY INSTRUMENT OR
10 INSTRUMENTS CREATING SUCH ENCUMBRANCE AND THE STEPS, IF ANY,
11 TAKEN TO PROTECT THE PURCHASER IN SUCH EVENTUALITY.
12 (7) A COPY OF THE ARTICLES OF INCORPORATION WITH ALL
13 AMENDMENTS THERETO, IF THE DEVELOPER IS A CORPORATION, COPIES
14 OF ALL INSTRUMENTS BY WHICH A DEED OF TRUST IS CREATED OR
15 DECLARED, IF THE DEVELOPER IS A TRUST, COPIES OF ARTICLES OF
16 PARTNERSHIP OR ASSOCIATION AND ALL OTHER PAPERS PERTAINING TO
17 ITS ORGANIZATION IF THE DEVELOPER IS A PARTNERSHIP,
18 UNINCORPORATED ASSOCIATION, JOINT STOCK COMPANY OR OTHER FORM
19 OF ORGANIZATION AND IF THE PURPORTED HOLDER OF LEGAL TITLE IS
20 A PERSON OTHER THAN THE DEVELOPER, COPIES OF THE ABOVE
21 DOCUMENTS FOR SUCH PERSON.
22 (8) COPIES OF THE DEED OR OTHER INSTRUMENT ESTABLISHING
23 TITLE TO THE PROPERTY IN THE DEVELOPER OR OTHER PERSON AND
24 COPIES OF ANY INSTRUMENT CREATING A LIEN OR ENCUMBRANCE UPON
25 THE TITLE OF THE DEVELOPER OR OTHER PERSON OR COPIES OF THE
26 OPINION OR OPINIONS OF COUNSEL IN RESPECT TO THE TITLE TO THE
27 SUBDIVISION IN THE DEVELOPER OR OTHER PERSON OR COPIES OF THE
28 TITLE INSURANCE POLICY GUARANTEEING SUCH TITLE.
29 (9) COPIES OF ALL FORMS OF CONVEYANCE TO BE USED IN
30 SELLING OR LEASING LOTS TO PURCHASERS.
19830H1448B2679 - 31 -
1 (10) COPIES OF INSTRUMENTS CREATING EASEMENTS OR OTHER
2 RESTRICTIONS.
3 (11) CERTIFIED FINANCIAL STATEMENTS OF THE DEVELOPER OR
4 AN UNCERTIFIED FINANCIAL STATEMENT IF A CERTIFIED STATEMENT
5 IS NOT AVAILABLE AS MAY BE REQUIRED BY THE COMMISSION.
6 (12) SUCH OTHER INFORMATION AND SUCH OTHER DOCUMENTS AND
7 CERTIFICATIONS AS THE COMMISSION MAY REQUIRE AS BEING
8 REASONABLY NECESSARY OR APPROPRIATE TO ASSURE THAT
9 PROSPECTIVE PURCHASERS HAVE ACCESS TO TRUTHFUL AND ACCURATE
10 INFORMATION CONCERNING THE OFFERING.
11 (13) CONSENT TO SUBMIT TO THE JURISDICTION OF THE
12 COMMONWEALTH COURT WITH RESPECT TO ANY ACTION ARISING UNDER
13 THIS SECTION.
14 (E) IF AT ANY TIME SUBSEQUENT TO THE DATE OF FILING OF A
15 STATEMENT OF RECORD WITH THE COMMISSION, A CHANGE SHALL OCCUR
16 AFFECTING ANY MATERIAL FACTS REQUIRED TO BE CONTAINED IN THE
17 STATEMENT, THE DEVELOPER SHALL PROMPTLY FILE AN AMENDMENT
18 THERETO.
19 (F) IF IT APPEARS TO THE COMMISSION THAT THE STATEMENT OF
20 RECORD OR ANY AMENDMENT THERETO, IS ON ITS FACE INCOMPLETE OR
21 INACCURATE IN ANY MATERIAL RESPECT, THE COMMISSION SHALL SO
22 ADVISE THE DEVELOPER WITHIN A REASONABLE TIME AFTER THE FILING
23 OF THE STATEMENT OR AMENDMENT. FAILURE OF THE DEVELOPER TO
24 PROVIDE THE INFORMATION REQUESTED BY THE COMMISSION WITHIN 90
25 DAYS SHALL RESULT IN AN AUTOMATIC DENIAL OF AN APPLICATION OR A
26 SUSPENSION OF REGISTRATION.
27 (G) IF IT APPEARS TO THE COMMISSION THAT A STATEMENT OF
28 RECORD INCLUDES ANY UNTRUE STATEMENT OF MATERIAL FACTS OR OMITS
29 TO STATE ANY MATERIAL FACT REQUIRED TO BE STATED THEREIN OR
30 NECESSARY TO MAKE THE STATEMENTS THEREIN NOT MISLEADING, THE
19830H1448B2679 - 32 -
1 COMMISSION MAY REJECT SUCH APPLICATION. THE COMMISSION SHALL
2 MAKE AN INVESTIGATION OF ALL CONSUMER COMPLAINTS CONCERNING REAL
3 ESTATE PROMOTIONS IN THE ABSENCE OF A RECIPROCAL AGREEMENT TO
4 HANDLE ON-SITE INSPECTIONS. UNDER NO CIRCUMSTANCES SHALL A
5 MEMBER OR AN EMPLOYEE OF THE COMMISSION PERFORM AN ON-SITE
6 INSPECTION. IF THE COMMISSION DETERMINES THAT A VIOLATION OF
7 THIS SECTION HAS OCCURRED, THE COMMISSION MAY:
8 (1) SUSPEND OR REVOKE ANY REGISTRATION;
9 (2) REFER THE COMPLAINT TO THE CONSUMER PROTECTION
10 BUREAU OF THE OFFICE OF ATTORNEY GENERAL; OR
11 (3) SEEK AN INJUNCTION OR TEMPORARY RESTRAINING ORDER TO
12 PROHIBIT THE COMPLAINED OF ACTIVITY IN THE COMMONWEALTH
13 COURT.
14 (H) UPON REJECTION OF AN APPLICATION OR AMENDMENT, THE
15 APPLICANT MAY WITHIN 20 DAYS AFTER SUCH NOTICE REQUEST A HEARING
16 BEFORE THE COMMISSION. PRIOR TO, AND IN CONJUNCTION WITH SUCH
17 HEARING, THE COMMISSION OR ITS DESIGNEE, SHALL HAVE ACCESS TO
18 AND MAY DEMAND THE PRODUCTION OF ANY BOOKS AND PAPERS OF, AND
19 MAY EXAMINE THE DEVELOPER, ANY AGENTS OR ANY OTHER PERSON, IN
20 RESPECT OF ANY MATTER RELEVANT TO THE APPLICATION. IF THE
21 DEVELOPER OR ANY AGENTS FAIL TO COOPERATE OR OBSTRUCT OR REFUSE
22 TO PERMIT THE MAKING OF AN INVESTIGATION, SUCH CONDUCT SHALL BE
23 GROUNDS FOR THE DENIAL OF THE APPLICATION.
24 Section 14. The act is amended by adding sections to read:
25 Section 606. Broker's disclosure to seller.
26 In any listing agreement or contract of agency, the broker
27 shall make the following disclosures to any seller of real
28 property:
29 (1) A statement that the broker's commission and the
30 time period of the listing are negotiable.
19830H1448B2679 - 33 -
1 (2) A statement describing the purpose of the Real
2 Estate Recovery Fund established under section 801 and the
3 telephone number of the commission at which the seller can
4 receive further information about the fund.
5 Section 607. Broker's disclosure to buyer.
6 In any sales agreement or sales contract, a broker shall make
7 the following disclosures to any prospective buyer of real
8 property:
9 (1) A statement that the broker is the agent of the
10 seller, not the buyer.
11 (2) A statement describing the purpose of the Real
12 Estate Recovery Fund established under section 801 and the
13 telephone number of the commission at which the purchaser can
14 receive further information about the fund.
15 (3) A statement of the zoning classification of the
16 property EXCEPT FOR SINGLE FAMILY DWELLINGS. FAILURE OF ANY <--
17 SALES AGREEMENT OR SALES CONTRACT TO CONTAIN A STATEMENT OF
18 THE ZONING CLASSIFICATION OF THE PROPERTY SHALL RENDER THE
19 SALES AGREEMENT OR SALES CONTRACT NULL AND VOID AND ANY
20 DEPOSITS TENDERED BY THE BUYER SHALL BE RETURNED TO THE BUYER
21 WITHOUT ANY REQUIREMENT FOR ANY COURT ACTION.
22 Section 608. Information to be given at initial interview.
23 At the initial interview with a prospective buyer or seller <--
24 the broker or salesperson must provide that person with a
25 pamphlet printed and distributed by the commission, which
26 explains all the following:
27 (1) That the broker is the agent of the seller and not
28 the buyer.
29 (2) The purpose of the Real Estate Recovery Fund and the
30 telephone number of the commission at which more information
19830H1448B2679 - 34 -
1 can be obtained.
2 (3) A statement that both the duration of the listing
3 agreement or contract and the broker's commission are
4 negotiable.
5 (4) That any sales agreement or sales contract must
6 contain the zoning classification of the property.
7 THE COMMISSION SHALL ESTABLISH RULES OR REGULATIONS WHICH <--
8 SHALL SET FORTH THE MANNER AND METHOD OF DISCLOSURE OF
9 INFORMATION TO THE PROSPECTIVE BUYER OR SELLER DURING THE
10 INITIAL INTERVIEW. SUCH DISCLOSURE SHALL INCLUDE, BUT SHALL NOT
11 BE LIMITED TO:
12 (1) A STATEMENT THAT THE BROKER IS THE AGENT OF THE
13 SELLER.
14 (2) THE PURPOSE OF THE REAL ESTATE RECOVERY FUND AND THE
15 TELEPHONE NUMBER OF THE COMMISSION AT WHICH FURTHER
16 INFORMATION ABOUT THE FUND MAY BE OBTAINED.
17 (3) A STATEMENT THAT THE DURATION OF THE LISTING
18 AGREEMENT OR CONTRACT AND THE BROKER'S COMMISSION ARE
19 NEGOTIABLE.
20 (4) A STATEMENT THAT ANY SALES AGREEMENT MUST CONTAIN
21 THE ZONING CLASSIFICATION OF A PROPERTY.
22 Section 15. Section 803 of the act, amended March 7, 1982
23 (P.L.158, No.50), is amended to read:
24 Section 803. Application for recovery from fund.
25 (a) When any aggrieved person obtains a final judgment in
26 any court of competent jurisdiction against any person licensed
27 under this act, upon grounds of fraud, misrepresentation or
28 deceit with reference to any transaction for which a license or
29 registration certificate is required under this act (including
30 with respect to cemetery companies any violation of 9 Pa.C.S. §
19830H1448B2679 - 35 -
1 308(b) (relating to accounts of qualified trustee)) and which
2 cause of action occurred on or after the effective date of this
3 act, the aggrieved person may, upon termination of all
4 proceedings, including reviews and appeals, file an application
5 in the court in which the judgment was entered for an order
6 directing payment out of the Real Estate Recovery Fund of the
7 amount unpaid upon the judgment.
8 (b) The aggrieved person shall be required to show:
9 (1) That he is not a spouse of the debtor, or the
10 personal representative of said spouse.
11 (2) That he has obtained a final judgment as set out in
12 this section.
13 (3) That all reasonable personal acts, rights of
14 discovery and such other remedies at law and in equity as
15 exist have been exhausted in the collection thereof.
16 (4) That he is making said application no more than one
17 year after the termination of the proceedings, including
18 reviews and appeals in connection with the judgment.
19 (c) The commission shall have the right to answer actions
20 provided for under this section, and subject to court approval,
21 it may compromise a claim based upon the application of the
22 aggrieved party.
23 (d) When there is an order of the court to make payment or a
24 claim is otherwise to be levied against the fund, such amount
25 shall be paid to the claimant in accordance with the limitations
26 contained in this section. Notwithstanding any other provisions
27 of this section, the liability of that portion of the fund
28 allocated for the purpose of this act shall not exceed $20,000
29 for any one [judgment] claim and shall not exceed $100,000 per
30 licensee. If the [$20,000] $100,000 liability of the Real Estate
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1 Recovery Fund as provided herein is insufficient to pay in full
2 claims adjudicated valid of all aggrieved persons against any
3 one licensee or registrant, such [$20,000] $100,000 shall be
4 distributed among them in such ratio that the respective claims
5 of the aggrieved applicants bear to the aggregate of such claims
6 held valid. If, at any time, the money deposited in the Real
7 Estate Recovery Fund is insufficient to satisfy any duly
8 authorized claim or portion thereof, the commission shall, when
9 sufficient money has been deposited in the fund, satisfy such
10 unpaid claims or portions thereof, in the order that such claims
11 or portions thereof were originally filed, plus accumulated
12 interest at the rate of 6% a year.
13 (e) Upon petition of the commission the court may require
14 all claimants and prospective claimants against one licensee or
15 registrant to be joined in one action, to the end that the
16 respective rights of all such claimants to the Real Estate
17 Recovery Fund may be equitably adjudicated and settled.
18 (f) Should the commission pay from the Real Estate Recovery
19 Fund any amount in settlement of a claim as provided for in this
20 act against a licensee, the license of that person shall
21 automatically suspend upon the effective date of the payment
22 thereof by the commission. No such licensee shall be granted
23 reinstatement until he has repaid in full plus interest at the
24 rate of [6%] 10% a year, the amount paid from the Real Estate
25 Recovery Fund.
26 (g) Should the commission pay from the Real Estate Recovery
27 Fund any amount in settlement of a claim as provided for in this
28 act against a registrant the registrant shall automatically be
29 denied the right to sell cemetery lots upon the effective date
30 of the payment thereof by the commission. No such registrant
19830H1448B2679 - 37 -
1 shall be granted the right to sell cemetery lots until he has
2 repaid in full plus interest at the rate of [6%] 10% a year, the
3 amount paid from the Real Estate Recovery Fund.
4 Section 16. Persons who are members of the State Real Estate
5 Commission on the effective date of this act shall serve on the
6 State Real Estate Commission as provided for in this amendatory
7 act until their current terms on the State Real Estate
8 Commission would have expired or until their successors are duly
9 appointed and qualified but no longer than six months after the
10 expiration of their terms.
11 Section 17. Any person who holds a valid license issued by
12 the State Real Estate Commission under the act of February 19,
13 1980 (P.L.15, No.9), known as the Real Estate Licensing and
14 Registration Act prior to the effective date of this amendatory
15 act shall, on and after the effective date hereof, be deemed to
16 be licensed by the State Real Estate Commission as provided for
17 in this amendatory act.
18 SECTION 18. EACH RULE, REGULATION OR FEE OF THE COMMISSION <--
19 IN EFFECT ON THE EFFECTIVE DATE OF THIS ACT SHALL REMAIN IN
20 EFFECT AFTER SUCH DATE UNTIL REPEALED OR AMENDED BY THE
21 COMMISSION.
22 Section 18 19. This act, with respect to the State Real <--
23 Estate Commission, shall constitute the legislation required to
24 reestablish an agency pursuant to the act of December 22, 1981
25 (P.L.508, No.142), known as the Sunset Act.
26 Section 19 20. (a) Section 453 of the act of April 9, 1929 <--
27 (P.L.177, No.175), known as The Administrative Code of 1929, is
28 repealed.
29 (b) All acts and parts of acts are repealed insofar as they
30 are inconsistent with this act.
19830H1448B2679 - 38 -
1 Section 20. This act shall take effect in 60 days. <--
2 SECTION 21. (A) SECTIONS 18, 19 AND 21 OF THIS ACT SHALL <--
3 TAKE EFFECT IMMEDIATELY.
4 (B) THE REMAINDER OF THIS ACT SHALL TAKE EFFECT IN 90 DAYS.
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