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H0568................................by JUDICIARY, RULES AND ADMINISTRATION
REAL ESTATE LICENSEE - Amends existing law to provide that real estate
licensees found guilty of gross negligence or reckless conduct in a real
estate transaction are subject to discipline by the Real Estate Commission.
01/30 House intro - 1st rdg - to printing
02/02 Rpt prt - to Bus
02/20 Rpt out - rec d/p - to 2nd rdg
02/23 2nd rdg - to 3rd rdg
02/26 3rd rdg - PASSED - 67-0-3
AYES -- Alltus, Barraclough, Barrett, Bell, Bieter, Bivens,
Black(15), Black(23), Boe, Bruneel, Callister, Campbell, Chase,
Clark, Crow, Cuddy, Deal, Denney, Ellsworth, Field(13), Field(20),
Gagner, Geddes, Gould, Hadley, Hansen, Henbest, Hornbeck, Jaquet,
Jones(9), Jones(22), Jones(20), Judd, Kellogg, Kempton, Kendell,
Kjellander, Kunz, Lake, Linford, Loertscher, Mader, Marley, McKague,
Meyer, Miller, Mortensen, Newcomb, Pischner, Pomeroy, Reynolds,
Richman, Ridinger, Robison, Sali, Schaefer, Stevenson, Stoicheff,
Stone, Stubbs, Taylor, Tilman, Tippets, Trail, Watson, Wheeler,
Zimmermann
NAYS -- None
Absent and excused -- Crane, Wood, Mr Speaker
Floor Sponsor - Jones(9)
Title apvd - to Senate
02/27 Senate intro - 1st rdg - to Com/HuRes
03/06 Rpt out - rec d/p - to 2nd rdg
03/09 2nd rdg - to 3rd rdg
03/17 3rd rdg - PASSED - 31-0-4
AYES--Andreason, Boatright, Branch, Bunderson, Burtenshaw, Cameron,
Crow, Darrington, Dunklin, Frasure, Geddes, Hawkins, Ingram, Ipsen,
Keough, King, Lee, McLaughlin, Noh, Parry, Richardson, Risch, Sandy,
Schroeder, Sorensen, Stennett, Sweeney, Thorne, Twiggs, Wheeler,
Whitworth
NAYS--None
Absent and excused--Danielson, Deide, Hansen, Riggs
Floor Sponsor - Frasure
Title apvd - to House
03/18 To enrol
03/18 Rpt enrol - Sp signed
03/19 Pres signed - to Governor
03/20 Governor signed
Session Law Chapter 162
Effective: 03/20/98
H0568|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fourth Legislature Second Regular Session - 1998IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 568 BY JUDICIARY, RULES AND ADMINISTRATION COMMITTEE 1 AN ACT 2 RELATING TO THE IDAHO REAL ESTATE COMMISSION; AMENDING SECTION 54-2040, IDAHO 3 CODE, TO PROVIDE THAT REAL ESTATE LICENSEES FOUND GUILTY OF GROSS NEGLI- 4 GENCE OR RECKLESS CONDUCT IN A REAL ESTATE TRANSACTION ARE SUBJECT TO DIS- 5 CIPLINE BY THE REAL ESTATE COMMISSION AND TO MAKE TECHNICAL CORRECTIONS; 6 AND DECLARING AN EMERGENCY. 7 Be It Enacted by the Legislature of the State of Idaho: 8 SECTION 1. That Section 54-2040, Idaho Code, be, and the same is hereby 9 amended to read as follows: 10 54-2040. REVOCATION OR SUSPENSION OF LICENSE -- GROUNDS THEREFOR. A. The 11 commission may upon its own motion, and shall upon verified complaint in writ- 12 ing of any person claiming to have been injured or defrauded, investigate the 13 action of any person engaged in the business or acting in the capacity of real 14 estate broker or real estate salesman within this state and shall have the 15 power to temporarily suspend or permanently revoke licenses issued under the 16 provisions of this act and/or to impose a civil penalty in an amount not to 17 exceed five thousand dollars ($5,000) and to assess costs and attorney fees 18 against the person for the cost of any investigation and/or administrative or 19 other proceedings upon the licensee at any time where the holder thereof in 20 performing or attempting to perform any of the acts mentioned in section 21 54-2022, Idaho Code, regardless of whether the acts were for his own account 22 or in his capacity as a broker or salesman, is guilty of (a) making any fraud- 23 ulent misrepresentations; or, (b) a continued or flagrant course of misrepre- 24 sentation or making of false promises whether through agents or salesmen; or, 25 (c) failure to account for or remit any property or moneys coming into his 26 possession which belong to another; or, (d) failure to keep adequate records 27 of all property transactions in which he acts in the capacity of real estate 28 broker or real estate salesman; or, (e) failing or refusing upon demand to 29 disclose any information within his knowledge, or to produce any documents, 30 books, or records in his possession for inspection by the commission or its 31 authorized representatives when acting within the jurisdiction or by authority 32 of law; or, (f) employment of fraud, deception, misrepresentation, misstate- 33 ment or any unlawful means in applying for or securing a license to act as 34 real estate broker or salesman in the state of Idaho; or, (g) acting as a real 35 estate broker or salesman under an assumed name; or, (h) violation of any 36 provision of sections 54-2021tothrough 54-2053, 37 Idaho Code, or any of the rules made or promulgated by the real estate commis- 38 sion, or final order of the commission; or, (i) any other conduct whether of 39 the same or a different character than hereinabove specified which constitutes 40 dishonest or dishonorable dealings; or, (j) the use by a licensee of any pro- 41 vision allowing the licensee an option to purchase in any agreement authoriz- 42 ing or employing such licensee to sell, buy, list or exchange real estate for 43 compensation or commission, except when such licensee, prior to or coincident 2 1 with entering into such agreement, discloses in writing to his principal the 2 purpose for which the property will be purchased, that the licensee is 3 licensed, and such other information as the commission may require by 4 rule ; or, (k) gross negligence or reckless conduct in a regulated real 5 estate transaction. Conduct is grossly negligent or reckless when, taken as a 6 whole, the conduct substantially fails to meet the generally accepted standard 7 of care in the practice of real estate in Idaho . 8 B. The commission may also temporarily suspend or permanently revoke a 9 license where the holder thereof (a) is convicted of any felony in a state or 10 federal court, or is convicted ofanya misdemeanor 11 involving moral turpitude. The record of conviction, or a certified copy 12 thereof, certified by the clerk of the court, or the judge in whose court the 13 judgment was had, shall be prima facie evidence of conviction in such cases; 14 (b) is declared insane by a court of competent jurisdiction; provided, how- 15 ever, that when a license shall have been revoked or suspended for this cause, 16 such license may be reactivated by the commission upon a declaration of sanity 17 being made; (c) has a judgment entered against him in a civil action upon 18 grounds of fraud, misrepresentation, or deceit with reference to any transac- 19 tion for which a license is required. 20 C. The commission may also temporarily suspend or permanently revoke a 21 license of a broker or salesman where the license of such licensee, issued by 22 another jurisdiction, is suspended or revoked for acts or omissions which 23 would be grounds for suspension or revocation under chapter 20, title 54, 24 Idaho Code. A certified copy of the findings of fact, conclusions of law, mem- 25 orandum opinion and/or final order from the appropriate administrative agency 26 or court shall be prima facie evidence of the suspension or revocation and the 27 facts stated therein. 28 D. If the commission temporarily suspends or permanently revokes a 29 license, and/or imposes a civil penalty, the commission may withhold execution 30 of said suspension, revocation and/or civil penalty on such terms and for such 31 time as it may prescribe. 32 E. In the event of the revocation or suspension of the broker's license 33 issued to the designated broker of a partnership, limited liability company or 34 corporation, the license issued to such partnership, limited liability company 35 or corporation shall be revoked or suspended by the commission. However, the 36 commission may withhold execution of the revocation or suspension on such 37 terms and for such time as it may prescribe. 38 F. All civil penalties collected by the commission under the provisions 39 of this chapter shall be deposited in the state treasury to the credit of the 40 special real estate account established pursuant to section 54-2037, Idaho 41 Code. 42 G. The commission may accept, on such conditions as it may prescribe, or 43 reject any offer to voluntarily terminate the license of a person whose activ- 44 ity is under investigation or against whom a formal complaint has been filed. 45 SECTION 2. An emergency existing therefor, which emergency is hereby 46 declared to exist, this act shall be in full force and effect on and after its 47 passage and approval.
STATEMENT OF PURPOSE
RS07557
Relating to the regulatory jurisdiction of the Idaho Real
Estate Commission, this legislation allows the Commission to
investigate and discipline real estate licensees who are found
guilty of committing gross negligence or engaging in reckless
conduct in a regulated real estate transaction. Current law
does not allow the Commission to discipline licensees for such
acts, which constitute the majority of consumer complaints to
the agency. Under present law, the level of malfeasance an
Idaho real estate practitioner must commit before being
subject to discipline by the Commission is much higher than is
in the best interests of the citizens of Idaho, and this
legislation would give the Commission a much needed and
important regulatory tool, which is presently unavailable.
FISCAL IMPACT
The amendment will increase personnel costs somewhat due to an
increase in actionable complaints to the agency, but most of
the negative fiscal impact to the Commission should be offset
by the agency's ability (already in the law) to assess civil
fines and to collect its costs and attorney's fees from the
licensee guilty of the misconduct.
CONTACT
Name: Stan Burton/Nancy Matthews
Agency: Idaho Real Estate Commission
Phone: 334-3285
Statement of Purpose/Fiscal Impact
H 568