Chapter 3: Real Estate License Law and Commission Rules Flashcards Preview

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Flashcards in Chapter 3: Real Estate License Law and Commission Rules Deck (65)
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1

The DBPR

The Department of Business and Professional Regulation is commonly referred to as “The Department” or DBPR.

It is under the executive branch of the Governor and is governed by F.S. 120. The Department is structured according to the requirements of F.S.20.165.

2

Who is the head of the Department

The head of the Department is the Secretary, who is appointed by the Governor and is subject to confirmation by the Senate. There is no set term limit; the Secretary serves at the pleasure of the Governor. The Secretary is responsible for planning, directing, coordinating, and executing the powers, duties, and functions vested in the Department, its divisions, bureaus and other subunits.

3

Where are the principal offices of the DBPR, The Department

The principal offices of the Department are in Tallahassee, Florida.

4

F.S. 455

Created the Department to provide licensing, oversight, and regulation of businesses and professions in the state of Florida. The intent of it is to regulate professionals in the most cost-efficient manner so as to maximize competition, minimize the cost of licenses, and maximize public access.

5

The F.S.455 statute specifies that professions should only be regulated when:

• The unregulated practice of a profession can cause harm to the public health, safety or welfare.
• The potential for such harm is recognizable and clearly outweighs any anticompetitive impact that may result from regulation.
• The public is not effectively protected by other means such as federal, state or local legislation, statutes or ordinances.
• Less restrictive means of regulation are not available.

6

F.S. 475 contains 4 parts

• Part 1: Real Estate Brokers, Sales Associates and Schools; Defines the Florida Real Estate Commission (FREC). The Florida Administrative Code contains additional Commission rules that apply to real estate licensees.
• Part 2: Appraisers; Defines the Florida Real Estate Appraisal Board (FREAB). Contains additional FREAB rules that apply to appraisal licensees.
• Part 3: The Commercial Real Estate Sales Commission Lien Act; Allows a broker to place a lien on an owner’s net proceeds (personal property) for commissions earned during a sales transaction.
• Part 4: The Commercial Real Estate Leasing Commission Lien Act; Allows a broker who has earned a commission to place a lien on an owner’s real estate interests in commercial real estate that has been leased.

7

The Division of Real Estate (DRE)

One of the divisions of the Department is the Division of Real Estate (DRE or the Division).

The Division protects the public by regulation of real estate and appraisal licensees through education and compliance, pursuant to F.S. 475

The Division is responsible for the examination, licensing, and regulation of over a quarter of a million individuals, corporations, real estate schools and instructors.

8

Who is in charge of the Division

The Director of the Division is appointed by the Secretary of the Department and is subject to approval by a majority of the members of the Florida Real Estate Commission (FREC or the Commission). The Division Director is a salaried state employee who acts as the day-to-day manager of the Division. The Division offices are located in Orlando, Florida and may not be moved without permission of the legislature.

9

DBPR: Licensing & Regulation

The Department is responsible for licensing and regulation of the real estate profession.

10

FREC: Rule-making & Disciplinary Authority

The Department delegates rule-making and disciplinary authority for the real estate profession to the FREC (Commission).

11

DRE: Day-today Work of Regulation

The Commission is an administrative agency that has only seven members and no employees, so the day-to-day work of regulation of the real estate profession falls to the Division of Real Estate (Division). The Commission and the Division carry out the following Department duties:
• Conduction the investigation of applicants, licensees and unlicensed persons.
• Prosecuting those individuals and entities charged with violations of laws or rules.
• Issuing, renewing, and reissuing licenses.

12

Powers of the Department

1. Issuing injunctions
2. Cease-and Desist Orders Against Unlicensed Parties
3. Citations and Administrative Fines

13

Issuing injunctions

from a court against a licensee for failure to follow a Department order. The Department does not have the authority to issue injunctions against unlicensed persons, but may seek an injunction from the courts for failure to follow a Department order.

14

Cease- and Desist Orders Against Unlicensed Parties

The Department also has the power to issue a cease-and-desist order against an unlicensed party for violation of any rule or law under its administration.

15

Citations and Administrative Fines

Citations may be issued to violators of specified rules that include the payment of an administrative fine not to exceed $5,000 per offense.

16

The Department is authorized to

• Issue cease-and-desist orders,
• Administer oaths
• Take depositions
• Issue subpoenas
• Issue a notice of noncompliance or a citation, and
• Adopt rules concerning violations that may be submitted for mediation. (mediation offenses are defined as those that are economic in nature and are caused by and can be corrected by licensees. 14 days are allowed after contact by a mediator for the parties to agree to mediation and the matter must be resolved within 60 days.)

17

Conducting Investigations

The Department conducts investigations and the prosecution of complaints through the Division.
Enforcement costs are to be borne by the profession being regulated. A fee of $5 is collected from all applicants for licensure and all those who request a renewal of license to pay for investigation and prosecution of unlicensed activity.

18

Civil Action

The Department may also act as a plaintiff in a civil action. A civil penalty of not less than $500 or more than $5,000 for each offense may be imposed.

19

All Professions, Under F.S. 455

The Department issues and renews all licenses for all professions administered under F.S.455, including real estate licenses. The statute establishes procedures for biennial renewal of licenses; however, certain licenses may be issued for a four-year period.

20

Licensing Fees

Fees for licenses are determined by the budgetary requirements of each board or division, but may not exceed limits established by statute.
A board is allowed neither to operate with a negative balance nor to become a profit center.

21

Child Support Compliance

Applications for new and renewal licenses are screened in accordance with F.S.409 to confirm compliance with child support obligations. New applicants can be denied and renewal applicants can be suspended if found to be delinquent with child support obligations. Licenses can be reinstated after notification to the Department that a licensee has complied.

22

Giving False Information is a Third Degree Felony

Giving false info when applying for or renewing a license is a felony of the third degree, which is punishable by a criminal court. In addition, the Commission may take punitive action against those applying for a renewal under such circumstances.

23

Permit Required

Any school, institution or person offering to prepare students for a state exam for a sales associate or broker license must first be approved and issued a permit by the Department. Each school must have a permit holder, and each location from which the courses are offered must be individually issued a permit. Each instructor must also be issued a permit.
All permits are issued for a two-year period, which expires on September 30th of odd numbered years (i.e. September 30,2021). A permit to teach the Department approved courses cannot be used as an endorsement by the Commission.

24

Testing Service

The Division of Professions is responsible for providing testing services designed to assure competency to practice in an applicant’s chosen field. Currently, a private testing service is under contract with the Department to provide testing services for real estate and appraisal applicants.

25

Exams are Confidential

The theft or reproduction of such material is a third-degree felony.

26

Powers of the Commission

The Commission is an administrative agency that has been delegated certain powers under F.S.475 and F.A.C. 61J2

27

Four Specific types of the Commission's powers

Executive Powers
Quasi-legislative Powers
Quasi-judicial Powers
Ministerial Powers

28

Executive Powers

The power to keep the public informed- executive powers include the publication of books and newsletters to keep licensees and the public informed of new and important changes in the law and rules governing the real estate profession, furthering the education of potential and current licensees, and the investigation of complaints against licensee. The executive powers can be exercised by the chairperson acting alone or can be delegated by quorum vote to any other Commission member.

29

Quasi-legislative Powers

The power to make and pass rules- that regulate the operation of licensees and the real estate profession. Rules enacted by the Commission are not laws, but have much of the same effect. The purpose of the rule-making authority is to allow the Commission to interpret and implement law. The quasi-legislative powers cannot be delegated; a quorum vote of the Commission is required to exercise this authority. Rules enacted by the Commission do not require the approval of any agency or the legislature. They do not become effective, however, until 20 days after they have been filed with the Secretary of State. Rules cannot be in conflict with the U.S. Constitution, the laws of the state of Florida or the United States.

30

Quasi-judicial Powers

The Power to impose disciplinary action- for violations of laws or rules. These powers are similar to the actions of a court of law. The Commission has the authority to deny an application, and to reprimand, fine, or place a licensee on probation, or suspend or revoke a license. The quasi-judicial powers cannot be delegated and require a quorum vote to be exercised.