Chapter 14

BOARD OF REGISTRATION OF REAL ESTATE BROKERS AND SALESMEN

Chapter 13 : Section 54. Board of registration of real estate brokers and salesmen; appointment; term; vacancies. There shall be a board of registration of real estate brokers and salesmen in this section and in sections fifty-five to fifty-seven inclusive, called the board to be appointed by the governor, with the advice and consent of the council, consisting of five members, citizens of the commonwealth, three of whom shall have been actively engaged in the real estate business as a full-time occupation for at least seven years prior to their appointment and who shall be licensed real estate brokers, and two of whom shall be representatives of the public. The governor shall designate the chairman. As the term of office of a member of the board expires, his successor shall be appointed by the governor, with like advice and consent, to serve for five years. Each member shall be eligible for reappointment and shall serve until the qualification of his successor. The governor may also, with like advice and consent, fill any vacancy in the board for the unexpired portion of the term.

Chapter 13 : Section 55. Meetings; notice; quorum; record. The board shall hold at least four regular meetings each year and may hold special meetings as required. Time, place and notice of all meetings shall be as required by rules or by-laws made by the board. A quorum shall consist of three members. In case of vacancy in the office or absence of the chairman the senior member shall perform the duties of the chairman. A written record, which shall be open to public inspection, shall be kept of all meetings and of the business transacted thereat.

Chapter 13: Section 56. Rules and regulations; seal; annual report; contents. The board may make such rules or by-laws, not inconsistent with law, as it may deem necessary in the performance of its duties. The board shall have a seal. The board shall annually render to the governor and the general court a report of its proceedings, which shall include an itemized statement of all receipts and expenses of the board for the year.

Chapter 13: Section 57. Compensation and expenses; office; employees. Each member of the board shall serve without compensation, but shall be paid by the commonwealth the expenses necessarily incurred by him in the discharge of his official duties. The board may, subject to employ a secretary and such other clerical and technical assistants as may be necessary to discharge its official duties, shall establish their duties, and, subject to the provisions of sections forty-five to fifty, inclusive of chapter thirty shall fix their compensation, which shall be paid by the commonwealth. The commonwealth shall provide the board with adequate office space and shall pay the expenses of the board incurred in the performance of its duties.

Chapter 112: Section 87PP. Definitions. For the purposes of sections eighty-seven PP to eighty-seven DID, inclusive, the following words and phrases, unless the context otherwise requires, shall have the following meanings:

"Board", the board of registration of real estate brokers and salesmen.

"Non-resident", shall include and be deemed to apply to an individual whose principal place of abode is without the commonwealth and to a corporation, society, association or partnership, organized, formed or existing under the laws of another state and which does not maintain a usual place of business within the commonwealth.

"Real estate", any and every estate or interest in land and the improvements thereon, whether corporeal or incorporeal, whether freehold or non-freehold, and whether or not said land is situated within the commonwealth.

"Real estate broker", hereinafter referred to as broker, any person who for another person and for a fee, commission or other valuable consideration, or with the intention or in the expectation or upon the promise of receiving or collecting a fee, commission or other valuable consideration, does any of the following : sells, exchanges, purchases, rents or leases, or negotiates, or offers, attempts or agrees to negotiate the sale, exchange, purchase, rental or leasing of any real estate, or lists or offers, attempts or agrees to list any real estate, or buys or offers to buy, sells or offers to sell or otherwise deals in options on real estate, or advertises or holds himself out as engaged in the business of selling, exchanging, purchasing, renting or leasing real estate, or assists or directs in the procuring of prospects or the negotiation or completion of any agreement or transaction which results or is intended to result in the sale, exchange, purchase, leasing or renting of any real estate.

"Real estate salesman", hereinafter referred to as salesman, an individual who performs any act or engages in any transaction included in the foregoing definition of a broker, except the completing of the negotiation of any agreement or transaction which results or is intended to result in the sale, exchange, purchase, renting or leasing of any real estate.

Laws Chapter112

( Does not need RE Lic, ) Chapter 112 : Section 87QQ. Real estate brokers and salesmen; applicability of sections; exemption. The provisions of sections eighty-seven RR to eighty-seven ODD, inclusive, shall not apply to the following: any person who, acting for himself as owner, lessor, lessee, tenant or mortgagee, shall perform any of the aforesaid acts of a broker or salesman with reference to real estate owned or leased or rented by or to him, or mortgaged to him; the regular employees of any person aforesaid, with respect to such real estate, if such acts are performed in the regular course of, or as an incident to, the management of such real estate and the investment therein; any person, while acting for himself, who seeks to acquire, lease or rent real estate for his own use or investment or his regular employees acting in behalf of such person in the regular course of their employment; a person acting for himself in negotiating a loan secured or to be secured by a mortgage or other encumbrance upon real estate, or his regular employees acting therein in behalf of such person in the regular course of their employment; a managing agent while acting under a contract with the owner of the real estate or the regular employees of such agent acting in his behalf in the regular course of their employment; a person acting as a licensed auctioneer; a person buying, selling or otherwise dealing in any stock, bond or other security, or certificate of beneficial interest in any trust; a public officer or employee while performing his official duties; a person acting as attorney in fact under a duly executed power of attorney from an owner of real estate authorizing the final consummation by performance of any contract for the sale, leasing or exchange of real estate; the services rendered to a client by an attorney at law in the performance of his duties as such; a receiver, trustee in bankruptcy, executor, administrator, guardian or conservator, while acting as such; a person selling real estate under order of any court; a trustee acting under a written instrument of trust, or deed or declaration of trust, or will, or his regular employees, acting in the course of their employment; a bank as defined in section one of chapter one hundred and sixty-seven or organized under the laws of the United States or an insurance company lawfully engaged in business in the commonwealth, or the regular employees of such bank or insurance company acting in the course of their employment, when such bank or insurance company is acting in any aforementioned capacity of a fiduciary or is acting for itself in negotiating a loan secured or to be secured by a mortgage or other encumbrance upon real estate or is acting for itself with reference to real estate owned, mortgaged, leased or rented, by or to it or which it seeks to acquire, lease or rent for its own use; a credit union organized under chapter one hundred and seventy-one or the regular employees thereof acting in the course of their employment.

Chapter 112: Section 87RR. License; completion of transactions; fee or commission; action for compensation. Except as otherwise provided, no person shall engage in the business of or act as a broker or salesman directly or indirectly, either temporarily or as an incident to any other transaction, or otherwise, unless he is licensed.

No salesman may conduct or operate his own real estate business nor act except as the representative of a real estate broker who shall be responsible for the salesman and who must approve the negotiation and completion by the salesman of any transaction or agreement which results or is intended to result in the sale, exchange, purchase, renting or leasing of any real estate or in a loan secured or to be secured by mortgage or other encumbrance upon real estate. No salesman shall be affiliated with more than one broker at the same time nor shall any salesman be entitled to any fee, commission or other valuable consideration or solicit or accept the same from any person except his licensed broker in connection with any such agreement or transaction. A salesman may be affiliated with a broker either as an employee or as an independent contractor but shall be under such supervision of said broker as to ensure compliance with this section and said broker shall be responsible with the salesman for any violation of section eighty-seven AAA committed by said salesman.

Except as otherwise provided no person shall recover in any suit or action in the courts of the commonwealth for compensation for services as a broker performed within the commonwealth unless he was a duly licensed broker at the time such services were performed; provided, however, that nothing contained herein shall be construed as affecting the right of a licensed salesman to recover in a suit or action against a broker on any contract or agreement with said broker.

Chapter 112: Section 87SS. Applicants for license; requisites; attorney at law; examinations; rules and regulations. No license to engage as a broker or salesman shall be issued to any applicant unless he has complied with all the pertinent provisions of this section and sections eighty-seven TT to eighty-seven DDD, inclusive, and if the applicant is an: individual, unless he shall have satisfactorily passed a written examination conducted by the board or an independent testing service designated by the board, and, in the case of an application for a broker's license by an individual resident of the commonwealth, unless he shall have had his principal place of abode within the commonwealth for one year next prior to the issuance of such license; provided, however, that any applicant who is an attorney at law of the commonwealth shall not be required to take such examination or to have had such principal place of abode for such period.

Every individual applicant for a license as a salesman who is required to take an examination therefor shall, as a prerequisite to taking such examination, submit proof satisfactory to the board that he has completed courses in real estate subjects approved by the board, such courses to total twenty-four classroom hours of instruction; provided, however, that applicants having successfully completed a course in real property while enrolled in an accredited law school in the commonwealth may also take such examination. Every individual applicant for a license as a broker who is required to take an examination therefor shall, as a prerequisite to taking such examination, submit proof satisfactory to the board that he has been actively associated with a real estate broker for a period of one year as a real estate salesman and that he has completed additional courses in real estate subjects approved by the board, such courses to total thirty classroom hours of instruction.

Such examination shall be prepared by the board or the designated independent testing service to enable the board to determine the competence of the applicant to transact the business of a broker or a salesman. The board or its designated independent testing service shall conduct such examinations at least six times in each calendar year for broker's examinations and at least eight times in each calendar year for salesman's examinations. There shall be no limit placed on the number of applicants who may take the examinations on any examination date. In determining competence the board shall require proof that the applicant has a fair understanding of the principles of real estate practice, real estate agreements and principal and agent relations, of the rudimentary principles of the economics and appraising of real estate, and of the provisions of sections eighty-seven PP to eighty-seven DDD, inclusive. The examination for a salesman's license shall be based upon the same general subject matter as for a broker's license, but shall be more elementary in character.

The board may make, and from time to time alter, amend or repeal rules and regulations for the conduct of such examinations not inconsistent herewith.

Chapter 112: Section 87TT. Application for licenses; forms; fees; evidence of applicant; bonds; action on bond; temporary license. Applications for licenses, signed and sworn to by the applicant, shall be made on forms furnished by the board and shall be accompanied by an examination fee to be determined annually by the commissioner of administration under the provision of section three B of chapter seven. A fee for the issuance of the license shall be determined under the aforementioned provision and shall be payable upon receipt of notice of passing the examination. Each applicant shall furnish evidence of good moral character. If an application for a broker's license is made by a corporation, society, association or partnership, evidence of the good moral character of all the officers and directors, or holders of: similar positions, or of all the partners, as the case may be, shall also be furnished. No license shall be issued unless evidence of good moral character, as required by this Section, is found.

No license shall be issued unless the application has been on file with the board at least ten days. No broker's license shall be issued to any individual under eighteen years of age. Every application for a license shall furnish evidence that he is a citizen of the United States or shall present to the board a copy of his declaration of intention to become a citizen of the United States, certified by the clerk of the court in which it was filed, or a certificate from the Immigration and Naturalization Service of the United States, showing that, in accordance with law, he has declared his intention to become such citizen, and no license shall be issued to an applicant who fails to comply with these provisions. Unless an applicant who is an alien and who is subsequently licensed presents to the board his completed naturalization papers showing that he is a citizen of the United States within five years following the filing of the copy or certificate hereinbefore referred to his license shall be revoked.

No broker's license shall be issued or renewed until the applicant gives to the board a bond in the form approved by said board in the sum of five thousand dollars, executed by the applicant and by a surety company authorized to do business within the commonwealth, or by the applicant and by two good and sufficient sureties approved by the board. Said bond shall be payable to the commonwealth, for the benefit of any person aggrieved, and shall be conditioned upon the faithful accounting by the broker for all funds entrusted to him in his capacity as such. Any person so aggrieved may bring suit on the bond in his own name; provided, however, that the aggregate liability of the surety to all such persons shall, in no event, exceed the sum of such bond. The board may revoke the license of any broker whenever the bond filed by him ceases to be in full force and effect.

In the event of the death of a licensed broker, who is the sole proprietor of a real estate business, the board shall, upon application by his legal representative, issue, without examination, a temporary license to such legal representative, or to an individual designated by him and approved by the board, upon the filing of a bond as aforesaid and the payment of the prescribed fee, which shall authorize such temporary licensee to continue to transact said business for a period not to exceed one year from the date of death subject to all other provisions of sections eighty-seven FP to eighty-seven DDD applicable to a licensed broker except that such temporary license shall not be renewed.

Chapter 112; Section 87UU. Corporations, societies, associations or partnerships; application for brokers license. An application for a broker's license by a corporation, society, association or partnership shall designate at least one of its officers or partners as its representative for the purpose of obtaining its said license, and each such officer or partner so designated shall apply to the board for a broker's license in his own name at the same time unless he is already a licensed broker.

No broker's license shall be issued to a corporation, society, association or partnership unless an officer or partner so designated has been issued a broker's license as an individual. When the officer or partner so designated has been issued a broker's license as an individual and the corporation, society, association or partnership has complied with all pertinent requirements for the issuance of a broker's license to it, the board shall, for a fee, as determined annually by the commissioner of administration under the provision of section three B of chapter seven, paid in advance to the board, issue to it a broker's license which shall also bear the name of each designated officer or partner to whom a broker's license as an individual has been issued, and each such designated officer or partner shall be entitled to perform all the acts of a broker as agent or officer of such corporation, society, association or partnership, but shall not so act on his own behalf so long as he continues to be a designated officer or partner, unless the written consent thereto of such corporation, society, association or partnership is filed with the board. The license of a corporation, society, association or partnership shall cease unless at least one such designated officer or partner, as the case may be, is a licensed broker. If any designated officer or partner shall be refused a license or renewal, or if his license is revoked or suspended, or if he ceases to be connected with or to act in behalf of such corporation, society, association or partnership, it shall have the right to designate another officer or partner in his place who shall apply for a broker's license as an individual, unless he is already a licensed broker. Upon the death or disability of a sole designated officer or partner, who has been licensed, or upon the severance of his connection with the corporation, society, association or partnership, the corporation, society, association or the surviving partner or partners or successor partnership of the licensed partnership, if any, acting by another officer or partner, as the case may be, may continue to transact business and to exercise all rights of a broker subject to such regulations as may be made by the board, for a period not to exceed one year from such death, disability or severance as if its license were in full force and effect, subject to the suspension or revocation of such privilege for any cause which would be grounds for the suspension or revocation of a license; provided, that it shall proceed with due diligence to qualify for the issuance of a new license; and, provided, further, that the corporation, society, association or the surviving partner or partners or successor partnership, as the case may be, shall maintain in effect during said period a bond as prescribed in section eighty-seven TT as if a broker's license had been issued and was in effect for such period.

Except as otherwise provided, nothing in this section shall permit any other individual connected with any corporation, society, association or partnership, to which a license has been issued, to act as a broker or salesman on its behalf or otherwise without first obtaining a license so to act, and nothing in this section shall be construed as preventing any such other individual who is a licensed broker or salesman from acting as such on its behalf, if so authorized by it.

No salesman's license shall be issued to a corporation, society, association or partnership.

Chapter 112: Section 87VV. Licensed salesmen; restrictions; notices. No salesman who is not licensed shall be affiliated with a broker. A licensed salesman affiliated with a licensed broker shall not act as salesman for any other licensed broker while so affiliated, nor accept any valuable consideration for the performance of any act as a real estate salesman from any person except the broker with whom he is affiliated. A licensed salesman shall promptly give written notice to the board of any change of his business address, and failure to give such notice shall be grounds for the revocation of such license.

Chapter 112: Section 87WW. Non-residents; licensed broker or salesman; power of attorney; service of process. A non-resident may be licensed as a broker and a non-resident individual may be licensed as a salesman upon conforming to all pertinent provisions of sections eighty- seven PP to eighty-seven DDD, inclusive; provided, that the board may exempt from the written examination prescribed in section eighty-seven SS a broker or salesman duly licensed in any other state of the United States under the laws of which a similar exemption is extended to licensed brokers and salesmen of the commonwealth. Such non-resident licensee shall not be required to maintain a usual place of business within the commonwealth; provided, that such non-resident broker shall maintain a usual place of business within such other state in which he is so licensed.

No license shall be issued to such non-resident until he shall have filed with the chairman of the board a power of attorney constituting and appointing said chairman and his successor his true and lawful attorney, upon whom all lawful processes in any action or legal proceeding against him may be served, and therein shall agree that any lawful process against him which may be served upon his said attorney shall be of the same force and validity as if served on said non-resident, and that the authority thereof shall continue in force irrevocably as long as any liability of said non-resident remains outstanding in the commonwealth. Service of such process shall be made by leaving duplicate copies thereof in the hands or office of the chairman, and the chairman shall forthwith send one of said copies by mail, postage prepaid, addressed to the defendant at his last address as appearing on the records of the board. One of the duplicates of such process, certified by the chairman as having been served upon him, shall be deemed sufficient evidence of such service, and service upon such attorney shall be deemed service upon the principal.

Chapter 112: Section 87XX. Issuance of license; term; renewal licenses; records by board.

The board shall issue a license to an applicant who has complied with all pertinent requirements which shall entitle him to act as a broker or a salesman, as the case may be; provided, however, that a license issued to a corporation, society, association or partnership shall not authorize any unlicensed individual connected therewith to act as broker or salesman except as expressly provided in section eighty-seven UU. Such license shall be in such form as the board may determine, shall set forth the name and address of the licensee, shall specify the nature of the license, whether for a broker or salesman, the date of issuance, and shall bear a facsimile of the seal of the board. Except as otherwise provided in section eighty-seven UU in the case of a license issued to a corporation, society, association or partnership, a license shall be valid for a period of two years from the date of issue unless sooner suspended or revoked and shall be renewed by the board biennially thereafter, without examination, upon payment of the fee prescribed in section eighty seven ZZ; provided, that the application for renewal is made not later than one year from the expiration of the license, and the applicant, if an individual, or, if a corporation, society, association or partnership, each officer and director or holder of similar position or each partner , of whom evidence of good moral character is required in connection with the application for an original license in section eighty-seven TT, has not been found to be disqualified because of lack of good moral character, or for any ground set forth in sections eighty-seven PP to eighty-seven DDD, inclusive; and, provided, further, that the license of a corporation, society, association or partnership shall be renewed only upon the renewal of the individual license of at least one of its designated officers or partners, as the case may be. No fee shall be required of a corporation, society, association or partnership for the renewal of its license. Applications for renewals of licenses shall be signed and sworn to by the applicant and shall be made on forms furnished by the board. Such application forms shall be mailed by the board to each broker and salesman registered with the board, together with notice of the expiration of his license, not less than thirty days prior to such expiration. Renewal licenses shall be in such form as the board may determine. Notwithstanding the foregoing, the license originally issued to an individual shall be valid until the anniversary of the licensee's date of birth next occurring more than twenty-four months after the date of issuance. The board shall keep a record of all licensed brokers and salesmen which shall be open to inspection by the public and shall, from time to time, cause to be printed a new or revised publication containing an alphabetical list of such brokers and salesmen, together with their addresses, accompanied by such other information relative to the enforcement of the provisions of this chapter as it may deem of interest to the public.

Chapter 112: Section 87XX$4. Continuing education; certification of completion; failure to complete requirements; application of section. Any person holding a license as a real estate broker or salesman, which is subject to renewal on or after January first, nineteen hundred and ninety-nine, shall, within twenty-four months prior to each renewal, satisfactorily complete courses or programs of instruction approved by the board; provided, that for licenses renewed on or before December thirty-first, two thousand, the attendance at such courses or programs of instruction shall be equal to a total of twelve hours; and provided, further, that for licenses renewed on or after January first, two thousand and one, such number shall be no less than six hours but no more than twelve hours as determined by the board. The curriculum contained in such courses or programs shall contain at least six hours of instruction concerning or related to compliance with laws and regulations selected from any of the following subjects: fair housing; equal employment opportunity; accessibility for the disabled; agency law; environmental issues in real estate; zoning and building codes; real estate appraisal and financing; property tax assessments and valuation; and real estate board regulations. The board shall certify in advance the curriculum forming the basis of such courses or programs, which satisfy the provisions of this section.

Every person who is subject to the requirements of this section shall furnish, in a form satisfactory to the board, written certification that the required courses or programs were successfully completed. Upon successful completion of approved courses or programs, the licensee shall be deemed to have met the continuing education requirements of this section for license renewal. Every person who fails to furnish, in a form satisfactory to the board, written certification that the required courses or programs were completed shall be granted inactive status by the board upon renewal of his license in accordance with section eighty- seven XX.

Any person failing to meet requirements imposed upon him by this section or who has submitted to the board a false or fraudulent certificate of compliance therewith, shall, after a hearing thereon, which hearing may be waived by such person, be subject to the suspension of his license until such time as such person shall have demonstrated to the satisfaction of the board that he has complied with all the requirements of this section as well as with all other laws, rules and regulations applicable to such licensing.

The provisions of this section shall not apply to any person licensed by the board under the provisions of section eighty-seven SS who is not required to take an examination to be licensed; provided, however, that any out-of-state licensee who receives reciprocity from the board to practice in the commonwealth shall demonstrate to the board compliance with a continuing education program in such licensee's home state.

The provisions of this section shall not apply to any person licensed by the board who has been granted inactive status by the board. A person licensed by the board and whose license is inactive may not engage in the business of, or act as, a real estate broker or salesman, as defined in section eighty-seven PP, except that he may assist with or direct the procuring of prospects and may receive referral fees for such procurement activities. A person licensed by the board whose license is inactive shall be considered unlicensed for purposes of section eighty-seven RR. Engaging in the business of, or acting as, a real estate broker or salesman while a license is inactive, except as otherwise provided for in this section, may be grounds for revocation of such license. A person licensed by the board and whose license is inactive shall renew such license in accordance with section eighty-seven XX while such license is inactive. A person licensed by the board and whose license is inactive may apply to the board to reactivate such license, upon demonstration of the completion of the continuing education requirements for the renewal period immediately preceding the application for reactivation of such license and compliance with all then applicable requirements for licensure.

The board shall perform such duties and functions necessary to carry out the provisions of this section and shall promulgate rules and regulations pertaining to the development and administration of an inactive license designation. Such rules and regulations shall include, but not be limited to, developing procedures for the granting of inactive status, the reactivation of licenses, renewal fees and the notification of licensees of continuing education requirements prior to license reactivation.

The board of registration of real estate brokers and salesmen, created pursuant to sections eighty-seven PP through eighty-seven IODD, inclusive, of chapter one hundred and twelve of the General Laws, shall promulgate rules and regulations to implement the provisions of this act within one hundred and eighty days after its effective date.

Chapter 112: Section 871CY. Place of business; display of license; notice; change of business location. A licensed resident broker shall maintain a usual place of business in the commonwealth and shall display conspicuously therein or in any branch thereof his license or a certified copy thereof. He shall promptly give written notice to the board of any change of business location, and the board shall issue a new license for such new location for the unexpired term of such license. Failure to give such notice shall be grounds for the revocation of such license.

Chapter 112: Section 87ZZ. Fee; purposes; advance payments. Fees, as determined annually by the commissioner of administration under the provision of section three B of chapter seven, shall be paid by individuals in advance for the following:

(a) Examination for a broker's license or a salesman's license; provided however that a veteran holding an honorable discharge or a blind person shall not be required to pay any examination fee; and provided, further, in the event the examination is conducted by an independent testing service designated by the board under the authority of section eighty- seven SS, in addition to the above fee, each individual shall pay to the testing service a fee, approved by the board, covering the actual cost of giving the examination.

(b) Issuance and renewal of a broker's license; provided, however, that a blind person or a veteran suffering from paraplegia, as defined in section six B of chapter one hundred and fifteen, shall not be required to pay such fee.

(c) Issuance and renewal of a salesman's license; provided, however, that a blind person or a veteran suffering from paraplegia, as defined in section six B of chapter one hundred and fifteen, shall not be required to pay such fee.

(d) The applicable fee for the issuance of a license shall be adjusted by the board on the basis of each month during which the license originally issued would be valid unless revoked or suspended and, for this purpose, any part of a month shall be considered as a full month.

Chapter 112: Section 87AAA. Complaints; investigation by board; revocation or suspension of license; grounds; penalties. The board may, and upon the verified complaint in writing of an aggrieved person shall, investigate the action of any broker or salesman or any person who attempts to act in such capacity within the commonwealth, and, in addition to any grounds hereinbefore enumerated, may suspend, revoke or refuse to renew any license which it has found to have been obtained by false or fraudulent representation. The board may suspend, revoke or refuse to renew any license, when the board has found as a fact that the licensee, in performing or attempting to perform any act authorized by his license, has (a) knowingly made any substantial misrepresentation; (b) acted in the dual capacity of broker and undisclosed principal in the same transaction; (c) acted for more than one party to a transaction without the knowledge and consent of all the parties for whom he acts; (d) failed, within a reasonable time, to account for or remit any moneys belonging to others which have come into his possession as a broker or salesman; (e) paid commissions or fees to or divided the same with any person, who, being required to be licensed as a broker or salesman: in this or any other state, is not so licensed; (f) accepted, given or charged any undisclosed commission, rebate or profit on expenditures for a principal; (g) induced any party to a contract or lease-relating to real estate to break the same when such action is effected for the personal gain of the licensee; (h) commingled the money or other property of his principal with his own; (i) failed to give to both the buyer and seller a copy of the purchase and sale agreement; (j) committed any act expressly prohibited in sections eighty- seven RR to eighty-seven CCC, inclusive; (k) affirmatively solicited for sale, lease, or the listing for sale or lease, of residential property on the grounds of alleged change of value due to the presence or the prospective entry into the neighborhood of a person or persons of another race, economic level, religion or ethnic origin or distributes, or causes to be distributed, material or makes statements designated to induce a residential property owner to sell or lease his property due to such change in the neighborhood; or (1) accepted from a prospective seller a net listing, an agreement to sell real estate for a stated price which authorized the broker to keep as commission any amount of money received from the sale of said real estate in excess of the stated price. The board shall, after notice by the Massachusetts commission against discrimination that said commission has made a finding, which finding has become final, that a licensed broker or salesman committed an unlawful practice in violation of chapter one hundred and fifty-one B arising out of or in the course of his occupation as a licensed broker or salesman, shall suspend forthwith the license of said broker or salesman for a period of sixty days, and, if the said commission finds that said violation by such licensed broker or salesman occurred within two years of the date of a prior violation of said chapter one hundred and fifty-one B, which finding has been final, it shall so notify the board, and the board shall forthwith suspend the license of such broker or salesman for a period of ninety days. Whoever violates the provisions of clause (k) shall be punished by a fine of not less than one thousand nor more than twenty-five hundred dollars, or by imprisonment for not more than six months, or both.

No broker shall engage in a sale in the commonwealth of real property located in a land development in another state which is the subject of promotional advertising in the commonwealth unless the owner or developer of such land has submitted to the board full particulars regarding such land and the proposed terms of sale thereof and has deposited with the board such sum as it shall determine, to pay the expense of the investigation hereinafter prescribed. Any broker acting for such owner or developer, and his salesmen, shall comply with such rules, regulations, restrictions and conditions pertaining thereto as the board in its discretion may impose. The board shall investigate such matters and all reasonable expenses incurred by the board in such investigation shall be borne by the owner or developer of the property involved. No broker or salesman shall in any manner refer to the board of registration of real estate brokers and salesmen or to any member or employee thereof, in selling, offering for sale, or advertising or otherwise promoting the sale, mortgage or lease of any such property, nor make any representation whatsoever that such property has been inspected or approved or otherwise passed upon by said board or by any official, department or employee of the commonwealth. The board may suspend, revoke or refuse to renew any license when it has found that the licensee has failed to comply with the requirements of this paragraph or any part thereof.

The board may also suspend, revoke or refuse to renew any license when it has found that the licensee has been convicted of a criminal offense by a court of competent jurisdiction of this or any other state, which demonstrates his lack of good moral character to act as a broker or salesman as the case may be.

The board may reconsider any decision made by it and may reinstate any license, which has been suspended, and reissue any license which has been revoked.

Any person whose license is suspended or revoked shall also be liable to such other punishment as may be provided by law.

SECTION 156. Said chapter 112 hereby further amended by inserting after section 87AAA the following new section:

Section 87AAA%. (a) This section shall only apply to real estate brokers and salesmen for the intended purchase or sale of land with a building intended for use as 1 to 4 residential dwellings or the intended purchase or sale of land on which a building is intended to be constructed for use as 1 or 2 residential dwellings.

(b) A real estate broker or salesperson may act as a dual agent who represents both prospective purchasers and sellers only with the informed written consent of the prospective purchasers and sellers. Consent to dual agency shall be obtained in the form prescribed by the board and shall be signed and dated. Such written consent may be obtained when an agency relationship with the seller or purchaser is created, but notice of a dual agency relationship shall also be given to the prospective purchaser and to the seller after a listed property is first shown to the purchaser. Nothing herein shall require written notice to each prospective purchaser or seller who attends an open house showing of real property, provided that the broker or salesperson must conspicuously disclose the agency relationship.

(c) A real estate broker or salesperson and his affiliates may act for more than one party to a real estate transaction as designated agents only with informed written consent. With informed written consent in the form prescribed by the board, a real estate broker or salesman may appoint one or more licensees to act as a designated agent on behalf of a purchaser and may appoint one or more other licensees to act as a designated agent on behalf of a seller for a potential real estate transaction. With informed consent in the form prescribed by the board, a real estate broker or salesman may appoint one or more licensees to act as a designated agent on behalf of a seller and may appoint one or more other licensees to act as a designated agent on behalf of a purchaser for a potential real estate transaction. Appointment of a designated agent shall not be made unless the party has consented, at the commencement of the party's agency relationship with the real estate broker, that the party's designated agency relationship shall not extend to any other licensee affiliated with a broker and shall be limited to the licensees appointed to act as designated agent.

Upon appointment of a designated agent, the responsibility to satisfy agency duties owed to a purchaser or seller shall be solely the responsibility of the designated agent. Substitution of designated agents shall not be made without consent. When a designated agent is appointed, information known or acquired by the designated agent shall not be imputed to the appointing broker or salesman or to other affiliated licensees. Notwithstanding the foregoing, a designated agent and an appointing broker or salesman shall each have an obligation to reveal known material defects in a listed property and shall comply with all other requirements of law. When a real estate broker or salesman has appointed designated agents for both a buyer and a seller, the broker or salesperson shall be presumed to be a dual agent, who does not exclusively represent either the buyer or seller. Appointment of a designated agent shall not limit the liability or responsibility of the appointing broker or salesperson for breach of duty by a designated agent.

(d) There shall be a conclusive presumption that a purchaser or seller has consented to a designated agency relationship, if he has signed a disclosure form that substantially contains the descriptions in this section and any other provisions required by law no later than the date that the buyer makes or submits an offer to purchase the property or that a purchase and sale agreement is executed, whichever is first. Consent may be given before identifying a property or transaction. Nothing herein shall require written notice to each prospective purchaser or seller who attends an open house showing of real property, provided that the broker or salesperson must conspicuously disclose the agency relationship.

(e) No real estate broker or salesman shall enter into or offer a subagency agreement to another real estate broker or salesperson when marketing a property for sale without informing the seller about vicarious liability and obtaining written consent of the seller.

(f) A real estate broker or salesman may provide services as a facilitator who does not or represent a buyer seller and who does not act in an agency capacity.

SECTION 419. On or before July 1, 2005, the board of registration of real estate brokers and salesmen shall promulgate regulations necessary to carry out section 156.

SECTION 420. Section 156 shall become effective on July 1, 2005. Chapter 112: Section 87BBB. Investigations and hearings by board; powers; decisions; appeals; costs.

A. The board is hereby empowered to conduct such investigations and hearings and to take such action as may be appropriate and necessary to administer and enforce the provisions of sections eighty-seven PP to eighty-seven CCC, inclusive, and to report the violation of any provision of said sections to the proper prosecuting officers. The board may require by summons the attendance and testimony of witnesses and the production of books and papers. Witnesses at hearings shall be duly sworn. Any member, or agent of the board designated for such purpose, may administer oaths, examine witnesses and receive evidence.

The board may take testimony by deposition as in civil actions in the superior court. In case of the failure or refusal of a witness to appear and testify or to produce books and papers as required, the superior court for the county in which the investigation is carried on, or for the county in which the witness resides or has his principal place of business, upon application by the board, shall have jurisdiction to issue to such witness an order requiring such witness to appear before the board, there to produce books and papers, if so ordered, or to give testimony concerning the matter under investigation or in question. Witnesses summoned before the board shall be paid the same fees and mileage paid to witnesses in civil cases in the courts.

B. Decisions of the board shall be by at least a majority thereof and shall be in writing, signed by the members making the same, and shall contain a statement of the reasons therefor including determination of each issue of fact or law necessary thereto, and shall be sent to each interested party. No renewal of a license shall be refused, and no license shall be suspended or revoked, except after a hearing, of which at least ten days' written notice, including a statement of the grounds and a copy of the complaint or charges, if any, which the board proposes to consider, shall be given to the applicant for renewal or the licensee, who shall have the right to appear personally and by counsel at such hearing and to cross-examine witnesses and to produce evidence. In the case of a decision refusing to grant an original license, such a hearing shall be held, if, within ten days of the receipt of the decision the applicant files a written request with the board for such ,a hearing. The board shall fix the time and place of all hearings.

C. Any person aggrieved by a decision of the board refusing to grant or renew, or suspending or revoking, a license after a hearing, may appeal to the superior court sitting in equity for the county wherein he resides or has his principal place of business, or to said court sitting in equity for the county of Suffolk; provided, that such appeal shall be filed in such court within twenty days following receipt of notification by the board of such decision. The court shall hear all pertinent evidence and determine the facts, and upon the facts as so determined, annul such decision if found to exceed the authority of the board, or make such decree or decision as justice and equity may require. The foregoing remedy shall be exclusive, but the parties shall have all rights of appeal and exception as in other equity cases. Costs shall not be allowed against the board unless it shall appear to the court that the board acted with gross negligence or in bad faith or with malice in making the decision appealed from. Costs shall not be allowed against the party appealing from the decision of the board unless it shall appear to the court that said party acted in bad faith or with malice in making the appeal to the court.

Such appeal from a decision of the board refusing renewal of or suspending or revoking a license shall not operate as a stay of such refusal, suspension or revocation pending the final determination of such appeal.

Chapter 112: Section 87CCC. Violations; punishment. As of December 30, 2004, "individuals performing work without a license may be assessed a civil administrative penalty not to exceed $1,000. for the lot violation and $2,500. for a 2nd violation and any subsequent violations."

If the holder's license is invalid because it has been suspended, revoked or canceled by the Board, and the licensee continues to practice without his or her license, the "board" can assess a civil administrative penalty not to exceed $1,004. for the 1st violation, $2,500. for a 2nd and any subsequent violations.

Under the law, 20% off all civil administrative penalties assessed by the "boards" will be deposited in the Division of Professional Licensure Trust Fund, while the remaining 80% shall be deposited in the General Fund.

Chapter 112: Section 87DDD. Exemption from provisions. The provisions of sections sixty-one to sixty-five, inclusive, shall not apply to the board, to the registration or licensing of real estate brokers or salesmen, or to any real estate broker or salesman or to any person acting as such.

Chapter 112: Section 87DDD1/2. Persons finding dwelling accommodations for fee. No person shall engage in the business of finding dwelling accommodations for prospective tenants for a fee unless such person is a licensed broker or salesman as defined in section eighty-seven PP of chapter one hundred and twelve.

A real estate salesperson engages in the same activities as a broker, except completing the negotiation of any agreement or transaction. A salesperson also has no authority or control over escrow funds.

A salesperson must be affiliated with a broker, either as an employee or as an independent contractor, and work under the supervision of the broker. A salesperson cannot operate his own real estate business.

Things Buyers Should Know when Dealing with a Real Estate Agent

• Who does the real estate agent represent? Typically the broker represents the seller.

• Be cautious. Do not reveal too much personal information, especially when working with a seller's broker. Disclosing financial information or information regarding your urgency to make a deal may undermine your bargaining position if the broker conveys it to the seller.

• Make sure the real estate agent is licensed and in good standing with the Board. (Check that both the broker and salesperson's licenses have not been subject to disciplinary action, such as a suspension or revocation.) Call (617) 727-2373.

• You can negotiate the amount of any deposit.

Deposits: Both parties need to be clear about who will hold any deposit funds and what will happen in the event of a dispute between the parties. All agreements should be in writing, and no party should sign an agreement or pay any money until they are comfortable that they understand the terms.

If a broker accepts money from you for any reason, that broker must immediately deposit the payment in an escrow account, a separate bank account that is maintained specifically as a depository for funds belonging to others. The money must be kept in this separate account until the transaction is successfully completed or is terminated. It is illegal for a broker to mingle your funds with his own.

If a salesperson accepts your payment or deposit, the salesperson must turn over this money to the supervising broker.

• If you make an offer to purchase a property listed by a broker, the broker or salesperson is required to convey your offer to the owner of the property immediately.

You should be clear about your negotiating position prior to making an offer on a property. Don't become attached to property beyond your desired price range. You could end up spending beyond your means.

• You can negotiate the terms of a purchase and sale agreement.

Purchase and Sale Agreement: A Purchase and Sale Agreement is the contract between the buyer and seller noting the terms concerning the purchase of the house (real property).

Essentially, it controls the sale of the home from seller to buyer. It includes information on what is being sold, the sale price, your financing, the type of title you will get, the closing date, the amount of deposit you have paid over and how much of the house price you are financing.

Typical negotiable items include: The amount of the deposit, the closing date, the number of loan applications you will file and the main terms of such loan (e.g., that your are trying for fixed rate loan that does not exceed a specific percentage and number of years). You may also rid the agreement of deposit dispute clauses or include one more favorable to you as the buyer should the sale fall through.

Allow enough time in the purchase and sale agreement to obtain financing. The purchase and sale agreement should also specify how many applications for financing constitute "good faith Repeated unsuccessful applications can be costly and time consuming. Investigate "pre-approval" before house hunting so you are clear about financial limitations.

If the broker or the seller makes any important promises or representations about the property or what will be included in the sale, make sure those promises are contained in the purchase and sale agreement.

Allow enough time in the purchase and sale agreement to have a professional home inspection performed. Use references from friends, not the listing broker, to find your own inspector.

• On the day of the closing, before papers are passed, make one final walk through of the property to be sure it is in the agreed upon condition.

• It is often wise to seek legal advice prior to signing any documents concerning the purchase of real estate. Ask questions. Don't sign anything until it has been explained to your full satisfaction.

Things Sellers Should Know when Dealing with a Real Estate Agent

• Find out whether you are dealing with a salesperson or a broker. You may want to make sure that your understanding with a salesperson is confirmed by the broker, with whom the salesperson is affiliated.

• Make sure the real estate agent is licensed and in good standing with the Board. (Check that both the broker and salesperson's licenses have not been subject to disciplinary action, such as a suspension or revocation.) Call (617) 727-2373.

• Sellers typically use the services of a real estate broker to sell their residential or commercial property. This is usually described as giving that broker a listing. The terms of the listing agreement are negotiable.

Listing Agreement: Often brokers present sellers with a standard listing agreement (an agreement which contains "standard language"). These agreements are certainly acceptable and are commonly used in the practice. (They are not, however, developed by the Real Estate Board or by state government.) You may negotiate different terms that are acceptable to you and the broker.

Typical negotiable items include: How long you will give a broker to sell your real property, the type of advertising which will be done, and the commission you will pay to the broker.

Unless your needs demand otherwise, your listing agreement should seek to have your property advertised in as many advertising mediums as possible, thereby giving it greater exposure to more potential buyers. (For example, the Multiple Listing Service of the private realtor professional associations, local newspapers, newspapers with statewide circulation, or the internet.)

• Determine whether you want the broker to represent you exclusively. This means that the broker is the only broker representing you in the sale of your real property. This is a typical arrangement, but some sellers may wish to enter into a non-exclusive listing agreement with a broker, based on their particular needs. In such situations, the broker does not exclusively have the right to sell your real property. That broker will attempt to sell it, but you may also employ other brokers and your own efforts in selling the real property. Naturally, non-exclusive listing agreements may affect the ultimate terms of the agreement, particularly the commission. (Remember, the broker bears the cost of advertising the property, which can be substantial. With a non- exclusive listing agreement, the broker may want a larger commission for a sale made by the broker since he or she undertakes these costs without the exclusive right to sell.)

• Check if a broker has errors and omissions insurance for his or her brokering practice. (State licensing law requires real estate brokers to have a five thousand dollar surety bond, but many brokers carry additional errors and omissions insurance.) This may be helpful should there be a problem which leads to litigation against a broker.

• Check to be sure your broker will accept offers made from other brokers including brokers who represent the buyer exclusively and brokers who may not be affiliated with a professional association. Brokers are required to present all offers that are made to them to you, the seller.

• Clearly understand what your interests are so that when you enter into a listing agreement with a broker you are comfortable with the terms. You also may want to have an attorney review such an agreement before you sign it.

Things Renters Should Know when Dealing with a Real Estate Agent

Anyone in the business of finding living accommodations for another for a fee, commission, or other valuable consideration must be licensed as a real estate broker or salesperson.

• Make sure the real estate agent is licensed and in good standing with the Board. Call (617) 727-2373.

• When seeking to rent or lease an apartment, house, or condominium through a real estate broker or salesperson, you may be asked to complete an application. Know what you are signing. Some applications may bind you to a fee that must be paid whether or not you ever sign a lease.

• Even when a standard application form (a form that contains "standard" language) is used, you can submit the application with changes that reflect your terms.

• There are no "agency disclosure" regulations for agents finding rental or lease property for a fee. Ask who the agent represents — you or the landlord?

• If you are asked to make a deposit, find out what the deposit will be applied to — first or last month's rent, security deposit, or a fee.

• Determine whether it is you or the landlord who will pay the agent's commission. If you are required to pay the commission, find out when the payment is due.

It is illegal for an apartment listing service to advertise or otherwise represent listings that claim to meet certain specifications when, in fact, they do not, or to state that it has listings meeting certain specifications when it has no such listings. It is also illegal for an apartment listing service to induce you to sign a contract by falsely representing that it has listings that conform to your requirements at the time the contract is executed.

Your Responsibility as a Consumer

Whether you are a buyer, a seller, or a renter, the duties of a real estate broker or salesperson do not relieve you of the responsibility to protect your own interests. If you have questions concerning your particular transaction, pose them to the agent. If you need advice on legal, tax, insurance or other matters, it is your responsibility to consult a professional in those areas.

No broker or salesperson should advise you against using the services of an attorney in any real estate transaction.

Filing a Complaint

While the majority of licensees conduct themselves as true professionals, the Division of Registration will take action against those who violate the statutes or the Board's rules and regulations.

In many cases, complaints are made by dissatisfied consumers, but dissatisfaction alone is not proof of incompetence or sufficient grounds for disciplinary action.

If you have a serious complaint against a real estate broker or salesperson, call or write the Division's Office of Investigations and ask for a complaint form:

Division of Registration

Office of Investigations

239 Causeway Street, Suite 400

Boston, MA 02114

Tel. (617) 727-7406

TYPES OF AGENCY REPRESENTATION

SELLER'S AGENT

A Seller can engage the services of a real estate agent to sell his property (called the listing agent) and the real estate agent is then the agent for the seller who becomes the agent's client. This means that the real estate agent represents the seller. The agent owes the seller undivided loyalty, reasonable care, disclosure, obedience to lawful instruction, confidentiality and accountability, provide, however, that the agent must disclose known material defects in the real estate. The agent must put the seller's interests first and negotiate for the best price and terms for their client, the seller. (The seller may authorize sub-agents to represent him/her in marketing its property to buyers, however the seller should be aware that wrongful action by the real estate agent or sub-agents may subject the seller to legal liability for those wrongful actions)

BUYER'S AGENT

A buyer can engage the services of a real estate agent to purchase property and the real estate agent is then the agent for the buyer who becomes the agent's client. This means that the real estate agent represents the buyer. The agent owes the buyer undivided loyalty, reasonable care, disclosure, obedience to lawful instruction, confidentiality and accountability, provided, however, that the agent must disclose known material defects in the real estate. The agent must put the buyer's interests first and negotiate for the best price and terms for their client, the buyer. (The buyer may also authorize sub-agents to represent him/her in purchasing property, however the buyer should be aware that wrongful action by the real estate agent or sub - agents may subject the buyer to legal liability for those wrongful actions).

(NON-AGENT) FACILITATOR

When a real estate agent works as a facilitator that agent assists the seller and buyer in reaching an agreement but does not represent either the seller or buyer in the transaction. The facilitator and the broker with whom the facilitator is affiliated owe the seller and buyer a duty to present each property honestly and accurately by disclosing known material defects about the property and owe a duty to account for funds. Unless otherwise agreed, the facilitator has no duty to keep information received from a seller or buyer confidential. The role of facilitator applies only to the seller and buyer in the particular property transaction involving the seller and buyer. Should the seller and buyer expressly. agree a facilitator relationship can be changed to become an exclusive agency relationship with either the seller or the buyer.

DESIGNATED SELLER'S AND BUYER'S AGENT

A real estate agent can be designated by another real estate agent (the appointing or designating agent) to represent either the buyer or seller, provided the buyer or seller expressly agrees to such designation. The real estate agent once so designated is then the agent for either the buyer or seller who becomes their client. The designated agent owes the buyer or seller undivided loyalty, reasonable care, disclosure, obedience to lawful instruction, confidentiality and accountability, provided, however, that the agent must disclose known material defects in the real estate. The agent must put their client's interests first and negotiate for the best price and terms for their client. In situations where the appointing agent designates another agent to represent the seller and an agent to represent the buyer then the appointing agent becomes a dual agent. Consequently a dual agent cannot satisfy fully the duties of loyalty, full disclosure, obedience to lawful instructions which is required of an exclusive seller or buyer agent. The dual agent does not represent either the buyer or the seller solely only your designated agent represents your interests. The written consent for designated agency must contain the information provided for in the regulations of the Massachusetts Board of Registration of Real Estate Brokers and Salespeople (Board). A sample designated agency consent is available at the Board's website at www.mass.gov/dpl/re.

DUAL AGENT

A real estate agent may act as a dual agent representing both the seller and buyer in a transaction but only with the express and informed consent of both the seller and buyer. Written consent to dual agency must be obtained by the real estate agent prior to the execution of an offer to purchase a specific property. A Dual agent shall be neutral with regard to any conflicting interest of the seller and buyer. Consequently a dual agent cannot satisfy fully the duties of loyalty, full disclosure, obedience to lawful instructions which is required of an exclusive seller or buyer agent. A dual agent does, however, still owe a duty of confidentiality of material information and accounting for funds. The written consent for dual agency must contain the information provided for in the regulations of the Massachusetts Board of Registration of Real Estate Brokers and Salespeople (Board) A Sample dual agency consent is available at the Board's website at www.mass.gov/dpl/re.

SUB - AGENCY REPRESENTATION

No broker or salesperson shall enter into an agreement with any other broker or salesperson to represent, a seller or purchaser as a secondary or sub-agent with out informing such seller or-purchaser in writing that the secondary or sub-agent's actions may Subject the 'seller or purchaser to vicarious liability. The broker or salesperson shall provide written notice containing the information of potential vicarious. liability and obtain the seller's or purchasers consent on such notice to secondary or sub-agency. The written notice must state that the broker may cooperate with another broker who is then a sub-agent of the seller or buyer. The written notice must further state that vicarious liability is the potential for a seller or buyer to be held liable for a misrepresentation or an act or omission of the sub-agent and that the sell or buyer authorizes the broker or salesperson to offer sub-agency in signing the notice. The broker or salesperson shall provide such notice at the execution of an agreement to sell the real property of the seller or when the agent and purchaser agree that the agent will represent such purchaser. This Section applies to real estate brokers or salespeople engaged in the purchase or sale of land with a building intended for use as a one to four unit residential dwelling or to the purchase or sale of land on which a building is intended to be constructed for use as a one or two unit residential dwelling.