S.B. No. 810
AN ACT
relating to the regulation of the sale and inspection of real
estate.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subsection (b), Section 1101.152, Occupations
Code, is amended to read as follows:
(b) The commission may set and collect reasonable fees to
implement the continuing education requirements for license
holders, including the following fees:
(1) for an application for approval of a continuing
education provider, not more than $400;
(2) for an application for approval of a continuing
education course of study, not more than $100; [and]
(3) for an application for approval of an instructor
of continuing education courses, not more than $40; and
(4) for attendance at a program to train instructors
of a continuing education course prescribed under Section 1101.455,
not more than $100.
SECTION 2. Subsection (c), Section 1101.204, Occupations
Code, is amended to read as follows:
(c) The commission may not conduct an investigation of a
person licensed under this chapter or Chapter 1102 [license holder]
in connection with a complaint submitted later than the fourth
anniversary of the date of the incident that is the subject of the
complaint.
SECTION 3. Section 1101.353, Occupations Code, is amended
by adding Subsection (d) to read as follows:
(d) The commission may issue a provisional moral character
determination. The commission by rule shall adopt reasonable terms
for issuing a provisional moral character determination.
SECTION 4. Subsection (a), Section 1101.358, Occupations
Code, is amended to read as follows:
(a) An applicant for a salesperson license must provide to
the commission satisfactory evidence that the applicant has
completed at least 14 [12] semester hours, or equivalent classroom
hours, of postsecondary education, including:
(1) at least four semester hours of core real estate
courses on principles of real estate;
(2) at least two semester hours of each of the
following core real estate courses:
(A) agency law; [and]
(B) contract law; and
(C) one additional core real estate course; and
(3) at least four semester hours of core real estate
courses or related courses.
SECTION 5. Subsection (a), Section 1101.454, Occupations
Code, is amended to read as follows:
(a) An applicant applying for the first renewal of a
salesperson license must provide to the commission satisfactory
evidence of completion of at least 18 [14] semester hours, or
equivalent classroom hours, of postsecondary education, including
14 [10] hours of core real estate courses.
SECTION 6. Subsections (e) and (h), Section 1101.455,
Occupations Code, are amended to read as follows:
(e) At least six of the continuing education hours required
by Subsection (b) must cover the following legal topics:
(1) commission rules;
(2) fair housing laws;
(3) Property Code issues, including landlord-tenant
law;
(4) agency law;
(5) antitrust laws;
(6) Subchapter E, Chapter 17, Business & Commerce
Code;
(7) disclosures to buyers, landlords, tenants, and
sellers;
(8) current contract and addendum forms;
(9) unauthorized practice of law;
(10) case studies involving violations of laws and
regulations;
(11) current Federal Housing Administration and
Department of Veterans Affairs regulations;
(12) tax laws;
(13) property tax consulting laws and legal issues; or
(14) other legal topics approved by the commission.
(h) The commission shall automatically approve the
following courses as courses that satisfy the mandatory continuing
education requirements of Subsection (f) [courses]:
(1) core real estate courses; and
(2) real estate-related courses approved by the State
Bar of Texas for minimum continuing legal education participatory
credit.
SECTION 7. Section 1101.557, Occupations Code, is amended
to read as follows:
Sec. 1101.557. ACTING AS AGENT; REGULATION OF CERTAIN
TRANSACTIONS. (a) A broker [license holder] who represents a
party in a real estate transaction or who lists real estate for sale
under an exclusive agreement for a party is [acts as] that party's
agent.
(b) A broker described by Subsection (a):
(1) may not instruct another broker to directly or
indirectly violate Section 1101.652(b)(22);
(2) must inform the party if the broker receives
material information related to a transaction to list, buy, sell,
or lease the party's real estate, including the receipt of an offer
by the broker; and
(3) shall, at a minimum, answer the party's questions
and present any offer to or from the party.
(c) For the purposes of this section:
(1) a license holder who has the authority to bind a
party to a lease or sale under a power of attorney or a property
management agreement is also a party to the lease or sale;
(2) an inquiry to a person described by Section
1101.005(6) about contract terms or forms required by the person's
employer does not violate Section 1101.652(b)(22) if the person
does not have the authority to bind the employer to the contract;
and
(3) the sole delivery of an offer to a party does not
violate Section 1101.652(b)(22) if:
(A) the party's broker consents to the delivery;
(B) a copy of the offer is sent to the party's
broker, unless a governmental agency using a sealed bid process
does not allow a copy to be sent; and
(C) the person delivering the offer does not
engage in another activity that directly or indirectly violates
Section 1101.652(b)(22).
SECTION 8. Section 1101.561, Occupations Code, is amended
to read as follows:
Sec. 1101.561. DUTIES OF INTERMEDIARY PREVAIL. (a) The
duties of a license holder acting as an intermediary under this
subchapter supersede the duties of a license holder established
under any other law, including common law.
(b) A broker must agree to act as an intermediary under this
subchapter if the broker agrees to represent in a transaction:
(1) a buyer or tenant; and
(2) a seller or landlord.
SECTION 9. Subsection (a), Section 1101.652, Occupations
Code, is amended to read as follows:
(a) The commission may suspend or revoke a license issued
under this chapter or take other disciplinary action authorized by
this chapter if the license holder:
(1) enters a plea of guilty or nolo contendere to or is
convicted of a felony in which fraud is an essential element, and
the time for appeal has elapsed or the judgment or conviction has
been affirmed on appeal, without regard to an order granting
community supervision that suspends the imposition of the sentence;
(2) procures or attempts to procure a license under
this chapter for the license holder or a salesperson by fraud,
misrepresentation, or deceit or by making a material misstatement
of fact in an application for a license;
(3) engages in misrepresentation, dishonesty, or
fraud when selling, buying, trading, or leasing real property in
the [license holder's own] name of:
(A) the license holder;
(B) the license holder's spouse; or
(C) a person related to the license holder within
the first degree by consanguinity;
(4) fails to honor, within a reasonable time, a check
issued to the commission after the commission has sent by certified
mail a request for payment to the license holder's last known
business address according to commission records;
(5) fails or refuses to produce on request, for
inspection by the commission or a commission representative, a
document, book, or record that is in the license holder's
possession and relates to a real estate transaction conducted by
the license holder;
(6) fails to provide, within a reasonable time,
information requested by the commission that relates to a formal or
informal complaint to the commission that would indicate a
violation of this chapter;
(7) fails to surrender to the owner, without just
cause, a document or instrument that is requested by the owner and
that is in the license holder's possession;
(8) fails to use a contract form required by the
commission under Section 1101.155; [or]
(9) fails to notify the commission, not later than the
30th day after the date of a final conviction or the entry of a plea
of nolo contendere, that the person has been convicted of or entered
a plea of nolo contendere to a felony or a criminal offense
involving fraud; or
(10) disregards or violates this chapter.
SECTION 10. Subsection (c), Section 1101.655, Occupations
Code, is amended to read as follows:
(c) A person [whose license or certificate is revoked under
this section] is not eligible for a [new] license or certificate
until the person has repaid in full the amount paid from the account
for the person, plus interest at the legal rate.
SECTION 11. Subchapter C, Chapter 1102, Occupations Code,
is amended by adding Section 1102.1035 to read as follows:
Sec. 1102.1035. ADDITIONAL GENERAL ELIGIBILITY
REQUIREMENTS FOR CERTAIN BUSINESS ENTITIES. (a) To be eligible
for a professional inspector license under this chapter:
(1) a corporation must designate one of its officers
or employees as its agent for purposes of this chapter; and
(2) a limited liability company must designate one of
its managers or employees as its agent for purposes of this chapter.
(b) A corporation or limited liability company may not act
as a professional inspector unless the entity's designated agent is
a licensed professional inspector according to the commission's
records.
SECTION 12. Subsection (b), Section 1102.205, Occupations
Code, is amended to read as follows:
(b) As a prerequisite for renewal of a real estate inspector
license, [or] professional inspector license, or apprentice
inspector license, the inspector must participate in the continuing
education program and submit evidence satisfactory to the
commission of successful completion of at least 16 [the following
number of] classroom hours of core real estate inspection courses
for each year of the license period [during the year] preceding the
renewal[:
[(1) eight hours for a real estate inspector license
renewal; or
[(2) 16 hours for a professional inspector license
renewal].
SECTION 13. Subchapter E, Chapter 1102, Occupations Code,
is amended by adding Section 1102.2051 to read as follows:
Sec. 1102.2051. ADDITIONAL RENEWAL REQUIREMENTS FOR
CERTAIN BUSINESS ENTITIES. (a) To renew a professional inspector
license under this chapter:
(1) a corporation must designate one of its officers
or employees as its agent for purposes of this chapter; and
(2) a limited liability company must designate one of
its managers or employees as its agent for purposes of this chapter.
(b) A corporation or limited liability company may not renew
a professional inspector license unless the entity's designated
agent is a licensed professional inspector according to the
commission's records.
SECTION 14. Subchapter A, Chapter 5, Property Code, is
amended by adding Section 5.014 to read as follows:
Sec. 5.014. PROHIBITED FEES. A person who has a right of
first refusal in real property that is a condominium subject to
Chapter 81 or Chapter 82 may not charge a fee for declining to
exercise that right, such as a fee for providing written evidence of
the declination.
SECTION 15. Subsections (b) and (c), Section 1101.454,
Occupations Code, are repealed.
SECTION 16. (a) The Texas Real Estate Commission shall
adopt rules necessary to administer the changes in law made by this
Act not later than January 1, 2006.
(b) The change in law made by this Act to Section 1101.358,
Occupations Code, applies only to an application for a salesperson
license filed on or after January 1, 2006. An application for a
salesperson license filed before January 1, 2006, is covered by the
law in effect at the time the application was filed, and the former
law is continued in effect for that purpose.
(c) The change in law made by this Act to Section 1101.454,
Occupations Code, applies only to the first renewal of a
salesperson license that expires on or after January 1, 2006. The
first renewal of a salesperson license that expires before January
1, 2006, is covered by the law in effect on the date the license
expires, and the former law is continued in effect for that purpose.
(d) The change in law made by this Act to Section 1101.652,
Occupations Code, applies only to conduct that occurs on or after
the effective date of this Act. Conduct that occurs before the
effective date of this Act is covered by the law in effect
immediately before the effective date of this Act, and the former
law is continued in effect for that purpose.
(e) The change in law made by this Act to Section 1102.205,
Occupations Code, applies only to an application for renewal of a
real estate inspector license, professional inspector license, or
apprentice inspector license that expires on or after January 1,
2006. A real estate inspector license, professional inspector
license, or apprentice inspector license that expires before
January 1, 2006, is covered by the law in effect immediately before
the effective date of this Act, and the former law is continued in
effect for that purpose.
SECTION 17. Except as provided by a contract entered into
before the effective date of this Act, Section 5.014, Property
Code, as added by this Act, applies only to a fee that is solicited
on or after the effective date of this Act for declining the
exercise of a right of first refusal.
SECTION 18. This Act takes effect September 1, 2005.
______________________________ ______________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 810 passed the Senate on
April 7, 2005, by the following vote: Yeas 31, Nays 0; and that
the Senate concurred in House amendments on May 26, 2005, by the
following vote: Yeas 31, Nays 0.
______________________________
Secretary of the Senate
I hereby certify that S.B. No. 810 passed the House, with
amendments, on May 18, 2005, by a non-record vote.
______________________________
Chief Clerk of the House
Approved:
______________________________
Date
______________________________
Governor