HB 2264--Am.
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As Amended by House Committee =================================================================================
Session of 1997
HOUSE BILL No. 2264By Committee on Judiciary2-7----------------------------------------------------------------------------
10 AN ACT concerning real estate; relating to the brokerage relationships 11 in real estate transactions act; amending K.S.A. 17-2707, 58-3045 and 12 58-3063 and K.S.A. 1996 Supp. 58-3036, 58-3037, 58-3039, 58-3042 13 and 58-3046a and repealing the existing sections; reviving K.S.A. 1996 14 Supp. 58-3035, 58-3050, 58-3062, 58-3064, 58-3065, 58-3068, 58- 15 30,101, 58-30,102, 58-30,103, 58-30,104, 58-30,105, 58-30,106, 58- 16 30,107, 58-30,108, 58-30,109, 58-30,110, 58-30,111, 58-30,112 and 74- 17 4202; amending K.S.A. 1996 Supp. 58-3035, as revived by section 3 of 18 this act, 58-3050, as revived by section 11 of this act, 58-3062, as re- 19 vived by section 13 of this act, 58-3064, as revived by section 16 of this 20 act, 58-3065, as revived by section 18 of this act, 58-3068, as revived 21 by section 20 of this act, 58-30,101, as revived and amended by section 22 22 of this act, 58-30,102, as revived by section 24 of this act, 58-30,103, 23 as revived by section 26 of this act, 58-30,104, as revived by section 28 24 of this act, 58-30,105, as revived by section 30 of this act, 58-30,106, 25 as revived by section 32 of this act, 58-30,107, as revived by section 34 26 of this act, 58-30,109, as revived by section 37 of this act, 58-30,110, 27 as revived by section 39 of this act, 58-30,111, as revived by section 41 28 of this act, 58-30,112, as revived by section 43 of this act, and 74-4202, 29 as revived by section 45 of this act, and repealing the existing sections; 30 also repealing K.S.A. 1995 Supp. 58-3035, as amended by section 20 31 of chapter 212 of the 1996 Session Laws of Kansas, 58-3050, as 32 amended by section 12 of chapter 212 of the 1996 Session Laws of 33 Kansas, 58-3062, as amended by section 13 of chapter 212 of the 1996 34 Session Laws of Kansas, 58-3064, as amended by section 14 of chapter 35 212 of the 1996 Session Laws of Kansas, 58-3065, as amended by 36 section 15 of chapter 212 of the 1996 Session Laws of Kansas, 58-3068, 37 as amended by section 16 of chapter 212 of the 1996 Session Laws of 38 Kansas, 74-4202, as amended by section 17 of chapter 212 of the 1996 39 Session Laws of Kansas and K.S.A. 1996 Supp. 58-30,108, as revived 40 by section 36 of this act and 74-4209. 41 42 Be it enacted by the Legislature of the State of Kansas: 43 New Section 1. On and after October 1, 1997: HB 2264--Am. 2 1 (a) A broker engaged as a transaction broker is not an agent for either 2 party. 3 (b) A transaction broker shall have the following obligations and re- 4 sponsibilities: 5 (1) To perform the terms of any written or oral agreement made with 6 any party to the transaction; 7 (2) to exercise reasonable skill and care as a transaction broker, in- 8 cluding, but not limited to: 9 (A) Presenting all offers and counteroffers in a timely manner, even 10 when the property is subject to a contract of sale; 11 (B) advising the parties regarding the transaction and suggesting that 12 such parties obtain expert advice as to material matters about which the 13 transaction broker knows but the specifics of which are beyond the ex- 14 pertise of the licensee; 15 (C) accounting in a timely manner for all money and property re- 16 ceived; 17 (D) keeping the parties fully informed regarding the transaction; 18 (E) assisting the parties in complying with the terms and conditions 19 of any contract including closing the transaction; 20 (F) disclosing to all prospective buyers or tenants all adverse material 21 facts actually known by the transaction broker, including but not limited 22 to: 23 (i) Any environmental hazards affecting the property which are re- 24 quired by law to be disclosed; 25 (ii) the physical condition of the property; 26 (iii) any material defects in the property; 27 (iv) any material defects in the title to the property; or 28 (v) any material limitation on the seller's or landlord's ability to per- 29 form under the terms of the contract; and 30 (G) disclosing to any prospective seller or landlord all adverse ma- 31 terial facts actually known by the transaction broker, including but not 32 limited to material facts concerning the buyer's or tenant's financial ability 33 to perform the terms of the transaction; 34 (3) comply with all requirements of this act and rules and regulations 35 adopted hereunder; and 36 (4) comply with any applicable federal, state and local laws, rules and 37 regulations and ordinances, including fair housing and civil rights and 38 rules and regulations. 39 (c) Except as provided in subsection (d), the transaction broker is not 40 required to disclose to any party to the transaction information relating 41 to the physical condition of the property if a written report regarding the 42 physical condition of the property has been prepared by a qualified third 43 party and provided to the party. HB 2264--Am. 3 1 (d) A transaction broker shall disclose to the party any facts actually 2 known by the transaction broker that were omitted from or contradict 3 any information included in a written report described in subsection (c). 4 (e) If pursuant to subsection (b)(2)(B), the transaction broker advised 5 the parties to obtain expert advice as to material matters about which the 6 transaction broker knows but the specifics of which are beyond the ex- 7 pertise of the transaction broker, no cause of action for any person shall 8 arise against the transaction broker pertaining to such material matters. 9 (f) The In any transaction regarding the sale or lease of real 10 estate other than commercial property or residential property of 11 more than four units, the following information shall not be disclosed 12 by a transaction broker without the consent of all parties: 13 (1) That a buyer or tenant is willing to pay more than the purchase 14 price or lease rate offered for the property; 15 (2) that a seller or landlord is willing to accept less than the asking 16 price or lease rate for the property; 17 (3) what the motivating factors are for any party buying, selling, or 18 leasing the property; 19 (4) that a seller, buyer, landlord or tenant will agree to financing 20 terms other than those offered; or 21 (5) any information or personal confidences about a party to the 22 transaction which might place the other party at an advantage over the 23 party unless the disclosure is required by law or failure to disclose such 24 information would constitute fraudulent misrepresentation. 25 (g) (1) Except as provided in subsection (g)(2), in any trans- 26 action regarding the sale or lease of commercial property or res- 27 idential property of more than four units, the following informa- 28 tion may be disclosed by a transaction broker unless prohibited by 29 the parties: 30 (A) That a buyer or tenant is willing to pay more than the pur- 31 chase price or lease rate offered for the property; 32 (B) that a seller or landlord is willing to accept less than the 33 asking price or lease rate for the property; 34 (C) what the motivating factors are for any party buying, sell- 35 ing or leasing the property; or 36 (D) that a seller, buyer, landlord or tenant will agree to fi- 37 nancing terms other than those offered. 38 (2) Any information or personal confidences about a party to 39 the transaction which might place the other party at an advantage 40 over the party shall not be disclosed unless the disclosure is re- 41 quired by law or failure to disclose such information would con- 42 stitute fraudulent misrepresentation. 43 (h) A transaction broker has no duty to conduct an independent in- HB 2264--Am. 4 1 spection of the property for the benefit of any party to the transaction 2 and has no duty to independently verify the accuracy or completeness of 3 statements made by the seller, landlord, buyer, tenant or qualified third 4 party inspectors. 5 (h) (i) A transaction broker has no duty to conduct an independent 6 investigation of the buyer's or tenant's financial condition or to verify the 7 accuracy or completeness of any statement made by the buyer or tenant. 8 (i) (j) A transaction broker may do the following without breaching 9 any obligation or responsibility: 10 (1) Show alternative properties not owned by the seller or landlord 11 to a prospective buyer or tenant; 12 (2) list competing properties for sale or lease; 13 (3) show properties in which the buyer or tenant is interested to other 14 prospective buyers or tenants; and 15 (4) serve as a single agent or subagent for the same or for different 16 parties in other real estate transactions. 17 (j) (k) Information known to a transaction broker shall not be im- 18 puted to any party to the transaction or to any licensee within the bro- 19 kerage firm engaged as a transaction broker. 20 (k) (l) A transaction broker may cooperate with other brokers or co- 21 operate and pay compensation to other brokers but shall not engage any 22 subagents. 23 Sec. 2. On and after October 1, 1997, K.S.A. 17-2707 is hereby 24 amended to read as follows: 17-2707. As used in this act, unless the con- 25 text clearly indicates that a different meaning is intended, the following 26 words mean: 27 (a) ``Professional corporation,'' a corporation organized under this act. 28 (b) ``Professional service,'' the type of personal service rendered by a 29 person duly licensed by this state as a member of any of the following 30 professions, each paragraph constituting one type: 31 (1) A certified public accountant; 32 (2) An architect; 33 (3) An attorney-at-law; 34 (4) A chiropractor; 35 (5) A dentist; 36 (6) An engineer; 37 (7) An optometrist; 38 (8) An osteopathic physician or surgeon; 39 (9) A physician, surgeon or doctor of medicine; 40 (10) A veterinarian; 41 (11) A podiatrist; 42 (12) A pharmacist; 43 (13) A land surveyor; HB 2264--Am. 5 1 (14) A licensed psychologist; 2 (15) A specialist in clinical social work; 3 (16) A registered physical therapist; 4 (17) A landscape architect; 5 (18) A registered professional nurse; 6 (19) A real estate broker or salesperson. 7 (c) ``Regulating board,'' the board or state agency which is charged 8 with the licensing and regulation of the practice of the profession which 9 the professional corporation is organized to render. 10 (d) ``Qualified person'': 11 (1) Any natural person licensed to practice the same type of profes- 12 sion which any professional corporation is authorized to practice; 13 (2) the trustee of a trust which is a qualified trust under subsection 14 (a) of section 401 of the internal revenue code of 1954, as amended, or 15 of a contribution plan which is a qualified employee stock ownership plan 16 under subsection (a) of section 409A of the internal revenue code of 1954, 17 as amended; or 18 (3) the trustee of a revocable living trust established by a natural 19 person who is licensed to practice the type of profession which any pro- 20 fessional corporation is authorized to practice, if the terms of such trust 21 provide that such natural person is the principal beneficiary and sole 22 trustee of such trust and such trust does not continue to hold title to 23 professional corporation stock following such natural person's death for 24 more than a reasonable period of time necessary to dispose of such stock. 25 Sec. 3. On and after July 1, 1997, K.S.A. 1996 Supp. 58-3035 is 26 hereby revived to read as follows: 58-3035. As used in this act, unless the 27 context otherwise requires: 28 (a) ``Advance listing fee'' means any fee charged for services related 29 to promoting the sale or lease of real estate and paid in advance of the 30 rendering of such services, including any fees charged for listing, adver- 31 tising or offering for sale or lease any real estate, but excluding any fees 32 paid solely for advertisement or for listing in a publication issued for the 33 sole purpose of promoting the sale or lease of real estate wherein inquiries 34 are directed to the owner of the real estate or to real estate brokers and 35 not to unlicensed persons who publish the listing. 36 (b) ``Agency agreement'' means a written agreement between the 37 principal and the licensee setting forth the terms and conditions of the 38 relationship. 39 (c) ``Associate broker'' means an individual who has a broker's license 40 and who is employed by another broker or is associated with another 41 broker as an independent contractor and participates in any activity de- 42 scribed in subsection (f). 43 (d) ``Branch broker'' means an individual who has a broker's license HB 2264--Am. 6 1 and who has been designated to supervise a branch office and the activ- 2 ities of salespersons and associate brokers assigned to the branch office. 3 (e) ``Branch office'' means a place of business other than the principal 4 place of business of a broker. 5 (f) ``Broker'' means an individual, other than a salesperson, who ad- 6 vertises or represents that such individual engages in the business of buy- 7 ing, selling, exchanging or leasing real estate or who, for compensation, 8 engages in any of the following activities as an employee of, or on behalf 9 of, the owner, purchaser, lessor or lessee of real estate: 10 (1) Sells, exchanges, purchases or leases real estate. 11 (2) Offers to sell, exchange, purchase or lease real estate. 12 (3) Negotiates or offers, attempts or agrees to negotiate the sale, 13 exchange, purchase or leasing of real estate. 14 (4) Lists or offers, attempts or agrees to list real estate for sale, lease 15 or exchange. 16 (5) Auctions or offers, attempts or agrees to auction real estate or 17 assists an auctioneer by procuring bids at a real estate auction. 18 (6) Buys, sells, offers to buy or sell or otherwise deals in options on 19 real estate. 20 (7) Assists or directs in the procuring of prospects calculated to result 21 in the sale, exchange or lease of real estate. 22 (8) Assists in or directs the negotiation of any transaction calculated 23 or intended to result in the sale, exchange or lease of real estate. 24 (9) Engages in the business of charging an advance listing fee. 25 (10) Provides lists of real estate as being available for sale or lease, 26 other than lists provided for the sole purpose of promoting the sale or 27 lease of real estate wherein inquiries are directed to the owner of the real 28 estate or to real estate brokers and not to unlicensed persons who publish 29 the list. 30 (g) ``Commercial or investment real estate property'' means any real 31 estate for which the present or intended use is other than one to four 32 residential units. 33 (h) ``Commission'' means the Kansas real estate commission. 34 (i) ``Lease'' means rent or lease for nonresidential use. 35 (j) ``Licensee'' means any person licensed under this act as a broker 36 or salesperson. 37 (k) ``Office'' means a broker's place of business, where records may 38 be maintained and licenses displayed, whether or not it is the broker's 39 principal place of business. 40 (l) ``Person'' means any individual or any foreign or domestic corpo- 41 ration, partnership or association. 42 (m) ``Real estate'' means any interest or estate in land, including any 43 leasehold or condominium, whether corporeal, incorporeal, freehold or HB 2264--Am. 7 1 nonfreehold and whether the real estate is situated in this state or else- 2 where, but does not include oil and gas leases, royalties and other mineral 3 interests, and rights of way and easements acquired for the purpose of 4 constructing roadways, pipelines, conduits, wires and facilities related to 5 these types of improvement projects for private and public utilities, mu- 6 nicipalities, federal and state governments, or any political subdivision. 7 For purpose of this act, any rights of redemption are considered to be an 8 interest in real estate. 9 (n) ``Salesperson'' means an individual, other than an associate bro- 10 ker, who is employed by a broker or is associated with a broker as an 11 independent contractor and participates in any activity described in sub- 12 section (f). 13 (o) ``Supervising broker'' means an individual, other than a branch 14 broker, who has a broker's license and who has been designated as the 15 broker who is responsible for the supervision of the primary office of a 16 broker and the activities of salespersons and associate brokers who are 17 assigned to such office and all of whom are licensed pursuant to subsec- 18 tion (b) of K.S.A. 58-3042 and amendments thereto. ``Supervising broker'' 19 also means a broker who operates a sole proprietorship and with whom 20 associate brokers or salespersons are affiliated as employees or independ- 21 ent contractors. 22 Sec. 4. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3035, as 23 revived by section 3 of this act, is hereby amended to read as follows: 58- 24 3035. As used in this act, unless the context otherwise requires: 25 (a) ``Advance listing fee'' means any fee charged for services related 26 to promoting the sale or lease of real estate and paid in advance of the 27 rendering of such services, including any fees charged for listing, adver- 28 tising or offering for sale or lease any real estate, but excluding any fees 29 paid solely for advertisement or for listing in a publication issued for the 30 sole purpose of promoting the sale or lease of real estate wherein inquiries 31 are directed to the owner of the real estate or to real estate brokers and 32 not to unlicensed persons who publish the listing. 33 (b) ``Agency agreement'' means a written agreement between the 34 principal and the licensee setting forth the terms and conditions of the 35 relationship. 36 (c) ``Associate broker'' means an individual who has a broker's license 37 and who is employed by another broker or is associated with another 38 broker as an independent contractor and participates in any activity de- 39 scribed in subsection (f) (e). 40 (d) (c) ``Branch broker'' means an individual who has a broker's li- 41 cense and who has been designated to supervise a branch office and the 42 activities of salespersons and associate brokers assigned to the branch 43 office. HB 2264--Am. 8 1 (e) (d) ``Branch office'' means a place of business other than the prin- 2 cipal place of business of a broker. 3 (f) (e) ``Broker'' means an individual, other than a salesperson, who 4 advertises or represents that such individual engages in the business of 5 buying, selling, exchanging or leasing real estate or who, for compensa- 6 tion, engages in any of the following activities as an employee of, or on 7 behalf of, the owner, purchaser, lessor or lessee of real estate: 8 (1) Sells, exchanges, purchases or leases real estate. 9 (2) Offers to sell, exchange, purchase or lease real estate. 10 (3) Negotiates or offers, attempts or agrees to negotiate the sale, 11 exchange, purchase or leasing of real estate. 12 (4) Lists or offers, attempts or agrees to list real estate for sale, lease 13 or exchange. 14 (5) Auctions or offers, attempts or agrees to auction real estate or 15 assists an auctioneer by procuring bids at a real estate auction. 16 (6) Buys, sells, offers to buy or sell or otherwise deals in options on 17 real estate. 18 (7) Assists or directs in the procuring of prospects calculated to result 19 in the sale, exchange or lease of real estate. 20 (8) Assists in or directs the negotiation of any transaction calculated 21 or intended to result in the sale, exchange or lease of real estate. 22 (9) Engages in the business of charging an advance listing fee. 23 (10) Provides lists of real estate as being available for sale or lease, 24 other than lists provided for the sole purpose of promoting the sale or 25 lease of real estate wherein inquiries are directed to the owner of the real 26 estate or to real estate brokers and not to unlicensed persons who publish 27 the list. 28 (g) ``Commercial or investment real estate property'' means any real 29 estate for which the present or intended use is other than one to four 30 residential units. 31 (h) (f) ``Commission'' means the Kansas real estate commission. 32 (i) (g) ``Lease'' means rent or lease for nonresidential use. 33 (j) (h) ``Licensee'' means any person licensed under this act as a bro- 34 ker or salesperson. 35 (k) (i) ``Office'' means a broker's place of business, where records may 36 be maintained and licenses displayed, whether or not it is the broker's 37 principal place of business. 38 (l) (j) ``Person'' means any individual or any foreign or domestic cor- 39 poration, partnership or association. 40 (m) (k) ``Real estate'' means any interest or estate in land, including 41 any leasehold or condominium, whether corporeal, incorporeal, freehold 42 or nonfreehold and whether the real estate is situated in this state or 43 elsewhere, but does not include oil and gas leases, royalties and other HB 2264--Am. 9 1 mineral interests, and rights of way and easements acquired for the pur- 2 pose of constructing roadways, pipelines, conduits, wires and facilities 3 related to these types of improvement projects for private and public 4 utilities, municipalities, federal and state governments, or any political 5 subdivision. For purpose of this act, any rights of redemption are consid- 6 ered to be an interest in real estate. 7 (n) (l) ``Salesperson'' means an individual, other than an associate bro- 8 ker, who is employed by a broker or is associated with a broker as an 9 independent contractor and participates in any activity described in sub- 10 section (f) (e). 11 (o) (m) ``Supervising broker'' means an individual, other than a 12 branch broker, who has a broker's license and who has been designated 13 as the broker who is responsible for the supervision of the primary office 14 of a broker and the activities of salespersons and associate brokers who 15 are assigned to such office and all of whom are licensed pursuant to 16 subsection (b) of K.S.A. 58-3042 and amendments thereto. ``Supervising 17 broker'' also means a broker who operates a sole proprietorship and with 18 whom associate brokers or salespersons are affiliated as employees or 19 independent contractors. 20 Sec. 5. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3036 is 21 hereby amended to read as follows: 58-3036. Unless exempt from this act 22 under K.S.A. 58-3037 and amendments thereto, no person shall: 23 (a) Directly or indirectly engage in or conduct or represent that such 24 person engages in or conducts the business of a broker, associate broker 25 or salesperson within this state unless such person is licensed as such a 26 broker, associate broker or salesperson in accordance with this act. 27 (b) Directly or indirectly act or represent that such person acts as a 28 broker, associate broker or salesperson within this state unless such per- 29 son is licensed as such a broker, associate broker or salesperson in accor- 30 dance with this act. 31 (c) Perform or offer, attempt or agree to perform any act described 32 in subsection (f) (e) of K.S.A. 58-3035 and amendments thereto, whether 33 as a part of a transaction or as an entire transaction, unless such person 34 is licensed pursuant to this act. 35 Sec. 6. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3037 is 36 hereby amended to read as follows: 58-3037. The provisions of this act 37 shall not apply to: 38 (a) Any person, other than a person licensed under this act, who di- 39 rectly performs any of the acts within the scope of this act with reference 40 to such person's own property. 41 (b) Any person who directly performs any of the acts within the scope 42 of this act with reference to property that such person is authorized to 43 transfer in any way by a power of attorney from the owner, provided that HB 2264--Am. 10 1 such person receives no commission or other compensation, direct or 2 indirect, for performing any such act. 3 (c) Services rendered by an attorney licensed to practice in this state 4 in performing such attorney's professional duties as an attorney. 5 (d) Any person acting as receiver, trustee in bankruptcy, administra- 6 tor, executor or guardian, or while acting under a court order or under 7 the authority of a will or a trust instrument or as a witness in any judicial 8 proceeding or other proceeding conducted by the state or any govern- 9 mental subdivision or agency. 10 (e) Any officer or employee of the federal or state government, or 11 any political subdivision or agency thereof, when performing the official 12 duties of the officer or employee. 13 (f) Any multiple listing service wholly owned by a nonprofit organi- 14 zation or association of brokers. 15 (g) Any nonprofit referral system or organization of brokers formed 16 for the purpose of referral of prospects for the sale or listing of real estate. 17 (h) Railroads or other public utilities regulated by the state of Kansas, 18 or their subsidiaries, affiliated corporations, officers or regular employees, 19 unless performance of any of the acts described in subsection (f) (e) of 20 K.S.A. 58-3035 and amendments thereto is in connection with the sale, 21 purchase, lease or other disposition of real estate or investment therein 22 unrelated to the principal business activity of such railroad or other public 23 utility or affiliated or subsidiary corporation thereof. 24 (i) The sale or lease of real estate by an employee of a corporation 25 which owns or leases such real estate, if such employee owns not less 26 than 5% of the stock of such corporation. 27 (j) The sale or lease of new homes by a person, partnership, associ- 28 ation or domestic corporation who constructed such homes, but the pro- 29 visions of this act shall apply to the sale or lease of any such homes by 30 any employee of such person, partnership or association or by any em- 31 ployee of such corporation who owns less than 5% of the stock of such 32 corporation. 33 (k) The lease of real estate for agricultural purposes. 34 Sec. 7. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3039 is 35 hereby amended to read as follows: 58-3039. (a) Any person desiring to 36 act as a broker or salesperson must file a written application for a license 37 with the commission or, if required by the commission, with the testing 38 service designated by the commission. The application shall be in such 39 form and detail as the commission shall prescribe and shall be accom- 40 panied by the appropriate application and license fees prescribed by 41 K.S.A. 58-3063, and amendments thereto. 42 (b) A license to engage in business as a broker or salesperson shall 43 be granted only to a person who is 18 or more years of age and who has HB 2264--Am. 11 1 a high school diploma or its equivalent. 2 (c) In addition to the requirements of subsection (b), except as pro- 3 vided in subsection (d), each applicant for an original license as a broker 4 shall have been: 5 (1) Licensed as a salesperson in this state or as a salesperson or broker 6 in another state, and shall have been actively engaged in any of the activ- 7 ities described in subsection (f) (e) of K.S.A. 58-3035 and amendments 8 thereto for a period of at least two years during the five years immediately 9 preceding the date of the application for a license; or 10 (2) if an applicant resides in a county that according to the 1994 11 estimates of the U.S. bureau of the census has a population of 20,000 or 12 less, the commission may, upon a finding that such county suffers from 13 a shortage of brokers and upon compelling evidence of need, waive or 14 alter the requirements of this subsection. The commission shall adopt 15 rules and regulations to establish alternative licensing criteria for such 16 applicants. 17 (d) The commission may accept proof of experience in the real estate 18 or a related business or a combination of such experience and education 19 which the commission believes qualifies the applicant to act as a broker 20 as being equivalent to all or part of the experience required by subsection 21 (c). 22 (d) (e) Except as provided in K.S.A. 58-3040 and amendments 23 thereto, each applicant for an original license shall be required to pass a 24 written examination covering generally the matters confronting brokers 25 or salespersons, and no license shall be issued on the basis of such an 26 examination either or both sections of which were administered more 27 than four months prior to the date that the applicant's application is filed 28 with the commission. The examination may be given by the commission 29 or any person designated by the commission. Each person taking the 30 examination shall pay the examination fee prescribed pursuant to K.S.A. 31 58-3063 and amendments thereto, which fee the commission may require 32 to be paid to it or directly to the testing service designated by the com- 33 mission. The examination for a broker's license shall be different from or 34 in addition to that for a salesperson's license. 35 (f) (1) On and after October 1, 1997, each applicant for an original 36 salesperson's license who meets the requirements of this act shall be issued 37 a temporary salesperson's license which shall expire six months after the 38 last calendar day of the month in which the license was issued, on the last 39 calendar day of that month. 40 (2) No later than 10 days prior to the expiration date of a temporary 41 salesperson's license, the salesperson shall file an application on a form 42 provided by the commission. The application shall be accompanied by the 43 license fee prescribed by K.S.A. 58-3063 and amendments thereto and HB 2264--Am. 12 1 evidence of compliance with the requirements of subsection (f)(1) of K.S.A. 2 58-3046a, and amendments thereto. The commission shall issue a sales- 3 person's license to a person who complies with the provisions of this par- 4 agraph. The issuance date of the salesperson's license shall be the day 5 following the expiration date of the temporary license. The expiration date 6 of the license shall be determined in accordance with a schedule estab- 7 lished by rules and regulations of the commission. 8 (3) Failure to comply with the provisions of paragraph (2) shall au- 9 tomatically cancel the temporary license on its expiration date. 10 (4) A person whose temporary salesperson's license was canceled pur- 11 suant to paragraph (3) may apply for a salesperson's license provided 12 such application, the license fee prescribed by K.S.A. 58-3063 and amend- 13 ments thereto, and evidence of attendance of 30 hours of instruction re- 14 ceived after issuance of the temporary license pursuant to subsection (f)(1) 15 of K.S.A. 58-3046a, and amendments thereto are received by the com- 16 mission within three months after the expiration date of the temporary 17 license. The commission shall issue a salesperson's license to a person who 18 complies with the provisions of this paragraph. The expiration date of the 19 license shall be determined in accordance with a schedule established by 20 rules and regulations of the commission. 21 (e) (g) The commission, prior to granting an original license, shall 22 require proof that the applicant has a good reputation for honesty, trust- 23 worthiness, integrity and competence to transact the business of broker 24 or salesperson in such manner as to safeguard the public interest. 25 (f) (h) An application for an original license as a salesperson shall be 26 accompanied by the recommendation of the broker with whom the sa- 27 lesperson is to be associated, or by whom the salesperson is to be em- 28 ployed, certifying that the applicant is honest, trustworthy and of good 29 reputation. 30 Sec. 8. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3042 is 31 hereby amended to read as follows: 58-3042. (a) No real estate license 32 shall give authority to any person other than the person to whom the 33 license is issued. 34 (b) No license shall be granted to a corporation, partnership, associ- 35 ation or limited liability company. Each person who is an officer of a 36 corporation or a member of a partnership, association or limited liability 37 company and who performs any act described in subsection (f) (e) of 38 K.S.A. 58-3035 and amendments thereto shall be a licensed broker, and 39 each person who is employed by or associated with a corporation, part- 40 nership, association or limited liability company and who performs any 41 act described in subsection (f) (e) of K.S.A. 58-3035 and amendments 42 thereto shall be a licensed broker or licensed salesperson. 43 Sec. 9. On and after October 1, 1997, K.S.A. 58-3045 is hereby HB 2264--Am. 13 1 amended to read as follows: 58-3045. (a) Except for a temporary sales- 2 person's license issued pursuant to subsection (f) of K.S.A. 58-3039, and 3 amendments thereto, each license issued or renewed by the commission 4 shall expire on a date determined in accordance with a schedule estab- 5 lished by rules and regulations of the commission, which date shall be 6 not more than two years from the date of issuance or renewal. Except as 7 otherwise provided by this act, applicants for issuance or renewal of a 8 license must satisfy all applicable requirements prior to issuance or re- 9 newal of the license. 10 (b) (1) Except for a temporary salesperson's license issued pursuant 11 to subsection (f) of K.S.A. 58-3039, and amendments thereto, each license 12 shall be renewable upon the filing, not less than 30 days prior to the 13 expiration date of the license, of a renewal application on or before the 14 renewal date, which is the last calendar day of the month preceding the 15 license expiration date. Such application shall be made on a form provided 16 by the commission and accompanied by (A) the required renewal fee 17 prescribed by K.S.A. 58-3063, and amendments thereto, and (B) evidence 18 of compliance with the requirements of K.S.A. 58-3046a and amend- 19 ments thereto. In each case in which a license is issued or renewed for a 20 period of other than one year, the commission shall compute to the near- 21 est whole month the required fee, based on annual renewal fee provided 22 for by K.S.A. 58-3063 and amendments thereto. or the licensee's license 23 with the licensee's request that the license be deactivated on the renewal 24 date pursuant to K.S.A. 58-3049, and amendments thereto. 25 (2) Failure to remit the required fee when due comply with para- 26 graph (1) on or before the renewal date will automatically cancel the 27 license, except that any on the license expiration date unless the license is 28 renewed pursuant to subsection (c) prior to the expiration date. 29 (c) Any licensee who fails to pay the required renewal fee when due 30 failed to comply with the requirements of subsection (b)(1), may have the 31 licensee's license reinstated and renewed by the payment of the required 32 renewal fee prescribed by K.S.A. 58-3063, and amendments thereto, and 33 a late fee of $50, if such fees are remitted to the commission not later 34 than six months following the expiration date of such license and accom- 35 panied by (1) an application for late renewal obtained from the commis- 36 sion, and (2) evidence of compliance with the requirements of K.S.A. 58- 37 3046a and amendments thereto or a written request that the licensee's 38 license be renewed on deactivated status pursuant to K.S.A. 58-3049 and 39 amendments thereto. 40 (c) (d) An application for renewal filed in compliance with the 41 requirements of subsection (b) shall entitle the applicant to continue op- 42 erating under the applicant's existing license after its specified expiration 43 date, unless such license has been suspended or revoked and has not been HB 2264--Am. 14 1 reinstated or unless such license is restricted, until such time as the com- 2 mission determines whether the application fulfills such requirements. 3 Sec. 10. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3046a 4 is hereby amended to read as follows: 58-3046a. (a) Except as provided 5 in K.S.A. 58-3040 and amendments thereto, any person who applies for 6 an original license in this state as a salesperson shall submit evidence, 7 satisfactory to the commission, of attendance of a principles of real estate 8 course, of not less than 30 hours of instruction, approved by the com- 9 mission and received within the 12 months immediately preceding the 10 filing of application for salesperson's license. The commission may require 11 the evidence to be furnished to the commission with the original appli- 12 cation for license or it may require the applicant to furnish the evidence 13 to the testing service designated by the commission as a prerequisite to 14 taking the examination required by K.S.A. 58-3039 and amendments 15 thereto. If the evidence is furnished to the testing service, the instruction 16 shall have been received within 12 months immediately preceding the 17 date of the examination. 18 (b) Except as provided in K.S.A. 58-3040 and amendments thereto, 19 any person who applies for an original license in this state as a broker 20 shall submit evidence, satisfactory to the commission, of attendance of 24 21 hours of instruction, approved by the commission and received within the 22 12 months immediately preceding the filing of application for broker's 23 license. Such hours shall be in addition to any hours of instruction used 24 to meet the requirements of subsection (c), (d) or, (e) or (f). The com- 25 mission may require the evidence to be furnished to the commission with 26 the original application for license, or it may require the applicant to 27 furnish the evidence to the testing service designated by the commission 28 as a prerequisite to taking the examination provided in K.S.A. 58-3039 29 and amendments thereto. If the evidence is furnished to the testing serv- 30 ice, the instruction shall have been received within 12 months immedi- 31 ately preceding the date of the examination. 32 (c) Except as provided in subsections (d) and, (e) and (f), at or prior 33 to each renewal date established by the commission, any person who is 34 licensed in this state as a broker or as a salesperson shall submit evidence, 35 satisfactory to the commission, of attendance of not less than 12 hours of 36 additional instruction approved by the commission and received during 37 the renewal period. 38 (d) Any person who obtained an original license in this state as a 39 salesperson after July 1, 1988, and before July 1, 1991, shall submit evi- 40 dence, satisfactory to the commission, of attendance of courses of instruc- 41 tion approved by the commission at or prior to each renewal date estab- 42 lished by the commission as follows: 43 (1) At or prior to the first license renewal, 50 hours of instruction HB 2264--Am. 15 1 received after the date of licensure. Such evidence shall not be required 2 until the second license renewal if the original license expires less than 3 six months after issuance. 4 (2) At or prior to each license renewal thereafter, 12 hours of addi- 5 tional instruction received during the renewal period. 6 Any salesperson who obtains a broker's license in this state prior to 7 completing the 50 hours of instruction required by this subsection shall 8 submit the same evidence to renew the broker's license that would have 9 been required to renew the salesperson's license. 10 (e) Any person who obtains an original license in this state as a sa- 11 lesperson on or after July 1, 1991 and before October 1, 1997, shall submit 12 evidence, satisfactory to the commission, of attendance of courses of in- 13 struction approved by the commission at or prior to each renewal date 14 established by the commission as follows: 15 (1) At or prior to the first license renewal, 30 hours of instruction 16 received after the date of licensure. Such evidence shall not be required 17 until the second license renewal if the original license expires less than 18 six months after issuance. 19 (2) At or prior to each license renewal thereafter, 12 hours of addi- 20 tional instruction received during the renewal period. 21 Any salesperson who obtains a broker's license in this state prior to 22 completing the 30 hours of instruction required by this subsection shall 23 submit the same evidence to renew the broker's license that would have 24 been required to renew the salesperson's license. 25 (f) The hours on record with the commission of any person who ac- 26 cumulated hours of instruction which were reported to the commission 27 by January 1, 1983, and who, on July 1, 1993, has more than 12 hours on 28 record shall be reduced by the commission to 12 hours. The 12 hours 29 which remain on the licensee's record on July 1, 1993, shall be used to 30 meet the requirement of subsection (c) at the licensee's next license re- 31 newal. Any person who obtains a temporary license in this state as a 32 salesperson on and after October 1, 1997, shall submit evidence, satisfac- 33 tory to the commission, of attendance of courses of instruction approved 34 by the commission as follows: 35 (1) No later than ten days prior to the expiration date of the tempo- 36 rary license, 30 hours of instruction received after the date of licensure. 37 (2) At or prior to the first renewal of a license issued pursuant to 38 subsection (f)(2) or (4) of K.S.A. 58-3039, and amendments thereto, 12 39 hours of additional instruction received during the renewal period. Such 40 evidence shall not be required until the second license renewal if the li- 41 cense expires less than six months after issuance. 42 (3) At or prior to each license renewal thereafter, 12 hours of addi- 43 tional instruction received during the renewal period. HB 2264--Am. 16 1 (g) Except for courses reviewed pursuant to subsection (j), on and 2 after January 1, 1994, courses of instruction required by this section shall 3 be courses approved by the commission and offered by: 4 (1) An institution which is accredited by the north central association 5 of colleges and secondary schools accrediting agency; 6 (2) an area vocational or vocational-technical school as defined by 7 K.S.A. 72-4412 and amendments thereto; 8 (3) a proprietary school which has been issued a certificate of ap- 9 proval pursuant to the Kansas proprietary school act; 10 (4) any agency of the state of Kansas; or 11 (5) a similar institution, approved by the commission, in another state. 12 (h) The commission shall adopt rules and regulations to: (1) Prescribe 13 minimum curricula and standards for all courses offered to fulfill edu- 14 cation requirements of this act, (2) designate a course of study to fulfill 15 any specific requirement, which may include requiring that licensees pass 16 a test as prescribed by the commission for any course designated by the 17 commission in rules and regulations as a mandatory core requirement, 18 (3) prescribe minimum qualifications for instructors of approved courses 19 and (4) establish standards and procedures for approval of courses and 20 instructors, monitoring courses, advertising, registration and maintenance 21 of records of courses, and withdrawal of approval of courses and instruc- 22 tors. 23 (i) The commission may approve nontraditional courses consisting 24 solely or primarily of home study, videotaped or computer-assisted in- 25 struction. For the purpose of this section, attendance of one hour of 26 instruction shall mean 50 minutes of classroom instruction or the equiv- 27 alent thereof in nontraditional study as determined by the commission. 28 (j) Courses of instruction required by this section shall be courses 29 approved by the commission either before or after their completion. The 30 commission may give credit toward the 12 hours of additional instruction 31 required by subsection (c),(d), (e) or (f) to any licensee who submits an 32 application for course review obtained from the commission and pays the 33 fee prescribed by K.S.A. 58-3063 and amendments thereto if, in the judg- 34 ment of the commission, the course meets the objectives of continuing 35 education. 36 (k) The commission shall publish annually a list of educational insti- 37 tutions and entities and the courses offered by them in this state which 38 are approved by the commission. 39 (l) No license shall be issued or renewed unless the applicable 40 requirements set forth in this section are met within the time prescribed. 41 Sec. 11. On and after July 1, 1997, K.S.A. 1996 Supp. 58-3050 is 42 hereby revived to read as follows: 58-3050. (a) The license of any licensee 43 may be revoked, suspended or restricted or a licensee may be censured, HB 2264--Am. 17 1 if: 2 (1) The commission finds that the license has been obtained by false 3 or fraudulent representation or that the licensee has committed a viola- 4 tion of this act or rules and regulations adopted hereunder, or the bro- 5 kerage relationships in real estate transactions act or rules and regulations 6 adopted thereunder as such act governs the sale or lease of real estate 7 that is one to four residential units, whether the licensee acted as an agent 8 or a principal in the real estate transaction; 9 (2) the licensee has entered a plea of guilty or nolo contendere to, or 10 has been convicted of: (A) Forgery, embezzlement, obtaining money un- 11 der false pretenses, larceny, extortion, conspiracy to defraud or any other 12 similar offense; (B) a crime involving moral turpitude; or (C) any felony 13 charge; or 14 (3) the licensee has been finally adjudicated and found to be guilty 15 of violation of the federal fair housing act (42 U.S.C. 3601 et seq.) or 16 K.S.A. 44-1015 through 44-1029, and amendments thereto. 17 (b) In addition to or in lieu of any other administrative, civil or crim- 18 inal remedy provided by law, the commission, in accordance with the 19 Kansas administrative procedure act and upon a finding that a licensee 20 has violated a provision of this act or rules and regulations adopted here- 21 under, or the brokerage relationships in real estate transactions act or 22 rules and regulations adopted thereunder as such act governs the sale or 23 lease of real estate that is one to four residential units, may impose on 24 such licensee a civil fine not exceeding $500 for each violation. 25 (c) If a broker or salesperson has been declared disabled by a court 26 of competent jurisdiction, the commission shall suspend the broker's or 27 salesperson's license for the period of disability. 28 (d) No complaint alleging violation of this act or rules and regulations 29 adopted hereunder, or the brokerage relationships in real estate trans- 30 actions act or rules and regulations adopted thereunder as such act gov- 31 erns the sale or lease of real estate that is one to four residential units, 32 shall be commenced more than three years from the date of the occur- 33 rence which is the subject of the complaint. 34 (e) All administrative proceedings pursuant to this section shall be 35 conducted in accordance with the Kansas administrative procedure act. 36 (f) Notwithstanding any provision of this act or the brokerage rela- 37 tionships in real estate transactions act, as such act governs the sale or 38 lease of real estate that is one to four residential units, to the contrary, 39 the commission may use emergency adjudicative proceedings, as provided 40 by K.S.A. 77-536 and amendments thereto, to summarily suspend the 41 license of any licensee if the commission has reasonable cause to believe 42 that the licensee's trust account is in unsound condition or that the li- 43 censee is misappropriating funds belonging to other persons. HB 2264--Am. 18 1 (g) If a licensee has entered a plea of guilty or nolo contendere to, or 2 has been convicted of, any felony charge, the commission may use emer- 3 gency adjudicative proceedings, as provided by K.S.A. 77-536 and amend- 4 ments thereto to suspend, revoke or restrict the licensee's license. 5 (h) When the real estate license of an individual is revoked and that 6 individual's name is included in the trade or business name of a real estate 7 brokerage business, the commission may deny continued use of the trade 8 or business name if, in the opinion of the commission, it would be con- 9 fusing or misleading to the public. 10 If the revocation of the individual's license is appealed to district court 11 and a stay of the commission's order is granted by the court, the com- 12 mission may not deny continued use of the trade or business name until 13 such time as the district court upholds the order of the commission. 14 Sec. 12. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3050, 15 as revived by section 11 of this act, is hereby amended to read as follows: 16 58-3050. (a) The license of any licensee may be revoked, suspended or 17 restricted or a licensee may be censured, if: 18 (1) The commission finds that the license has been obtained by false 19 or fraudulent representation or that the licensee has committed a viola- 20 tion of this act or rules and regulations adopted hereunder, or the bro- 21 kerage relationships in real estate transactions act or rules and regulations 22 adopted thereunder as such act governs the sale or lease of real estate 23 that is one to four residential units, whether the licensee acted as an agent 24 or a principal in the real estate transaction; 25 (2) the licensee has entered a plea of guilty or nolo contendere to, or 26 has been convicted of: (A) Forgery, embezzlement, obtaining money un- 27 der false pretenses, larceny, extortion, conspiracy to defraud or any other 28 similar offense; (B) a crime involving moral turpitude; or (C) any felony 29 charge; or 30 (3) the licensee has been finally adjudicated and found to be guilty 31 of violation of the federal fair housing act (42 U.S.C. 3601 et seq.) or 32 K.S.A. 44-1015 through 44-1029, and amendments thereto. 33 (b) In addition to or in lieu of any other administrative, civil or crim- 34 inal remedy provided by law, the commission, in accordance with the 35 Kansas administrative procedure act and upon a finding that a licensee 36 has violated a provision of this act or rules and regulations adopted here- 37 under, or the brokerage relationships in real estate transactions act or 38 rules and regulations adopted thereunder as such act governs the sale or 39 lease of real estate that is one to four residential units, may impose on 40 such licensee a civil fine not exceeding $500 for each violation. 41 (c) If a broker or salesperson has been declared disabled by a court 42 of competent jurisdiction, the commission shall suspend the broker's or 43 salesperson's license for the period of disability. HB 2264--Am. 19 1 (d) No complaint alleging violation of this act or rules and regulations 2 adopted hereunder, or the brokerage relationships in real estate trans- 3 actions act or rules and regulations adopted thereunder as such act gov- 4 erns the sale or lease of real estate that is one to four residential units, 5 shall be commenced more than three years from the date of the occur- 6 rence which is the subject of the complaint. 7 (e) All administrative proceedings pursuant to this section shall be 8 conducted in accordance with the Kansas administrative procedure act. 9 (f) Notwithstanding any provision of this act or the brokerage rela- 10 tionships in real estate transactions act, as such act governs the sale or 11 lease of real estate that is one to four residential units, to the contrary, 12 the commission may use emergency adjudicative proceedings, as provided 13 by K.S.A. 77-536 and amendments thereto, to summarily suspend the 14 license of any licensee if the commission has reasonable cause to believe 15 that the licensee's trust account is in unsound condition or that the li- 16 censee is misappropriating funds belonging to other persons. 17 (g) If a licensee has entered a plea of guilty or nolo contendere to, or 18 has been convicted of, any felony charge, the commission may use emer- 19 gency adjudicative proceedings, as provided by K.S.A. 77-536 and amend- 20 ments thereto to suspend, revoke or restrict the licensee's license. 21 (h) When the real estate license of an individual is revoked and that 22 individual's name is included in the trade or business name of a real estate 23 brokerage business, the commission may deny continued use of the trade 24 or business name if, in the opinion of the commission, it would be con- 25 fusing or misleading to the public. 26 If the revocation of the individual's license is appealed to district court 27 and a stay of the commission's order is granted by the court, the com- 28 mission may not deny continued use of the trade or business name until 29 such time as the district court upholds the order of the commission. 30 Sec. 13. On and after July 1, 1997, K.S.A. 1996 Supp. 58-3062 is 31 hereby revived to read as follows: 58-3062. (a) No licensee, whether acting 32 as an agent or a principal, shall: 33 (1) Intentionally use advertising that is misleading or inaccurate in 34 any material particular or that in any way misrepresents any property, 35 terms, values, policies or services of the business conducted, or uses the 36 trade name, collective membership mark, service mark or logo of any 37 organization owning such name, mark or logo without being authorized 38 to do so. 39 (2) Fail to account for and remit any money which comes into the 40 licensee's possession and which belongs to others. 41 (3) Misappropriate moneys required to be deposited in a trust ac- 42 count pursuant to K.S.A. 58-3061 and amendments thereto, convert such 43 moneys to the licensee's personal use or commingle the money or other HB 2264--Am. 20 1 property of the licensee's principals with the licensee's own money or 2 property, except that nothing herein shall prohibit a broker from having 3 funds in an amount not to exceed $100 in the broker's trust account to 4 pay expenses for the use and maintenance of such account. 5 (4) Accept, give or charge any rebate or undisclosed commission. 6 (5) Pay a referral fee to a person who is properly licensed as a broker 7 or salesperson in another jurisdiction or who holds a corporate real estate 8 license in another jurisdiction if the licensee knows that the payment of 9 the referral fee will result in the payment of a rebate by the out-of-state 10 licensee. 11 (6) Represent or attempt to represent a broker without the broker's 12 express knowledge and consent. 13 (7) Act in a dual capacity of agent and undisclosed principal in any 14 transaction regarding the sale or lease of commercial or investment real 15 estate property. 16 (8) Guarantee or authorize any person to guarantee future profits that 17 may result from the resale of real property. 18 (9) Place a sign on any property offering it for sale or lease without 19 the written consent of the owner or the owner's authorized agent. 20 (10) Offer real estate for sale or lease without the knowledge and 21 consent of the owner or the owner's authorized agent or on terms other 22 than those authorized by the owner or the owner's authorized agent. 23 (11) Induce any party to break any agency agreement or contract of 24 sale or lease. 25 (12) Solicit a listing or negotiate a sale, exchange or lease of com- 26 mercial or investment real estate property directly with an owner or lessor 27 if the licensee knows that such owner or lessor has, with regard to the 28 property, a written agency agreement granting an exclusive right to sell 29 or lease to another broker. 30 (13) Solicit an agency agreement or negotiate a sale, exchange or lease 31 of commercial or investment real estate property directly with a buyer or 32 lessee if the licensee knows that such buyer or lessee has a written agency 33 agreement granting exclusive representation to another broker. 34 (14) Except for a commercial or investment real estate property or 35 any property owned by any agency of the federal government, fail to 36 obtain a written agency agreement, including a fixed date of expiration, 37 signed by the party to be represented and by the licensee or fail to furnish 38 a copy of the agreement to the principal within a reasonable time. The 39 licensee shall not assign, sell or otherwise transfer a written agency agree- 40 ment to another broker without the express written consent of all parties 41 to the original listing agreement. 42 (15) In any transaction regarding the sale of commercial or invest- 43 ment real estate property if the licensee represents the seller, fail to dis- HB 2264--Am. 21 1 close to a prospective buyer that: (A) The licensee is or will be acting as 2 agent of the seller with the duty to represent the seller's interest; (B) the 3 licensee will not be the agent of the prospective buyer; and (C) infor- 4 mation given to the licensee will be disclosed to the seller. The disclosure 5 shall be made orally or in writing when the licensee agrees to assist the 6 prospective buyer to locate and inspect property and shall be made in any 7 contract for sale and in any lot reservation agreement. 8 (16) In any transaction regarding the sale of commercial or invest- 9 ment real estate property if the licensee represents the buyer, fail to 10 disclose to a prospective seller or seller's agent that: (A) The licensee is 11 or will be acting as agent of the buyer with the duty to represent the 12 buyer's interest; (B) the licensee will not be the agent of the seller; and 13 (C) information given to the licensee will be disclosed to the buyer. The 14 disclosure shall be made orally or in writing no later than the first showing 15 of the property and shall be made in any contract for sale and in any lot 16 reservation agreement. 17 (17) In any transaction regarding the sale of commercial or invest- 18 ment real estate property if the licensee represents both the buyer and 19 seller, the licensee shall immediately disclose in writing: (A) That the 20 licensee is acting as agent for both buyer and seller; and (B) the com- 21 pensation arrangement. The disclosure shall be signed by both the buyer 22 and the seller. If the exclusive right to sell agreement and the buyer's 23 agency agreement include the disclosure of the possibility of dual agency, 24 the written disclosure, for each specific transaction, shall be signed by the 25 buyer no later than the first showing of the property and by the seller no 26 later than the presentation of the offer to purchase. In addition, the dis- 27 closure of the agency relationship between all licensees involved and the 28 principals shall be included in any contract for sale and in any lot reser- 29 vation agreement. 30 (18) Offer or give prizes, gifts or gratuities which are contingent upon 31 an agency agreement or the sale, purchase or lease of real estate. 32 (19) Enter into a listing agreement on commercial or investment real 33 estate property in which the broker's commission is based upon the dif- 34 ference between the gross sales price and the net proceeds to the owner. 35 (20) Fail to see that financial obligations and commitments between 36 the parties to an agreement to sell, exchange or lease real estate are in 37 writing, expressing the exact agreement of the parties or to provide, within 38 a reasonable time, copies thereof to all parties involved. 39 (21) Procure a signature to a purchase contract which has no definite 40 purchase price, method of payment, description of property or method 41 of determining the closing date. 42 (22) Include in any agency agreement an authorization to sign or 43 initial any document on behalf of the licensee's principal in a commercial HB 2264--Am. 22 1 or investment real estate property transaction or authorization to act as 2 attorney-in-fact for the principal. 3 (23) Engage in fraud or make any substantial misrepresentation. 4 (24) Represent to any lender, guaranteeing agency or any other in- 5 terested party, either verbally or through the preparation of false docu- 6 ments, an amount in excess of the true and actual sale price of the real 7 estate or terms differing from those actually agreed upon. 8 (25) Fail to make known to any purchaser or lessee any interest the 9 licensee has in the real estate the licensee is selling or leasing or to make 10 known to any seller or lessor any interest the licensee will have in the real 11 estate the licensee is purchasing or leasing. 12 (26) Fail to inform both the buyer, at the time an offer is made, and 13 the seller, at the time an offer is presented, that certain closing costs must 14 be paid and the approximate amount of such costs. 15 (27) Fail without just cause to surrender any document or instrument 16 to the rightful owner. 17 (28) Accept anything other than cash as earnest money unless that 18 fact is communicated to the owner prior to the owner's acceptance of the 19 offer to purchase, and such fact is shown in the purchase agreement. 20 (29) Fail to deposit any check or cash received as an earnest money 21 deposit or as a deposit on the purchase of a lot within five business days 22 after the purchase agreement or lot reservation agreement is signed by 23 all parties, unless otherwise specifically provided by written agreement of 24 all parties to the purchase agreement or lot reservation agreement, in 25 which case the licensee shall deposit the check or cash received on the 26 date provided by such written agreement. 27 (30) Fail in response to a request by the commission or the director 28 to produce any document, book or record in the licensee's possession or 29 under the licensee's control that concerns, directly or indirectly, any real 30 estate transaction or the licensee's real estate business. 31 (31) In any transaction regarding the sale of commercial or invest- 32 ment real estate property if the licensee represents the seller, fail to 33 promptly submit any written offer to the licensee's principal when such 34 offer is received prior to the closing of the sale or fail to promptly submit 35 to the prospective buyer or buyer's agent any counteroffer made by the 36 seller, including any back-up offers properly identified as such. 37 (32) In any transaction regarding the sale of commercial or invest- 38 ment real estate property if the licensee represents the buyer, fail to 39 promptly submit any written offer to the seller or seller's agent or fail to 40 promptly submit to the licensee's principal any counteroffer made by the 41 seller, including any back-up offers properly identified as such. 42 (33) Refuse to appear or testify under oath at any hearing held by 43 the commission. HB 2264--Am. 23 1 (34) Demonstrate incompetency to act as a broker, associate broker 2 or salesperson. 3 (35) In any transaction regarding the sale or lease of commercial or 4 investment real estate property fail to disclose, or ascertain and disclose, 5 to any person with whom the licensee is dealing, any material information 6 which relates to the property with which the licensee is dealing and which 7 such licensee knew or should have known. 8 (36) Knowingly receive or accept, directly or indirectly, any rebate, 9 reduction or abatement of any charge, or any special favor or advantage 10 or any monetary consideration or inducement, involving the issuance of 11 a title insurance policy or contract concerning which the licensee is di- 12 rectly or indirectly connected, from a title insurance company or title 13 insurance agent, or any officer, employee, attorney, agent or solicitor 14 thereof. 15 (37) Engage in the purchase of one-, two-, three- or four-family 16 dwellings, including condominiums and cooperatives, or the acquisition 17 of any right, title or interest therein, including any equity or redemption 18 interests, if: 19 (A) (i) At the time of such purchase, the dwellings are subject to a 20 right of redemption pursuant to foreclosure of a mortgage on such dwell- 21 ings; (ii) the licensee fails to give written notice of the purchase, within 22 20 days thereafter, to the mortgage holder or judgment creditor who held 23 such mortgage; and (iii) the licensee, unless otherwise required by law or 24 court order, fails to apply any rent proceeds from the dwellings to the 25 judgment lien arising from the foreclosure of such mortgage, as payments 26 become due under the loan, regardless of whether the licensee is obli- 27 gated to do so; 28 (B) (i) the dwellings are subject to a loan which is secured by a mort- 29 gage and which is in default at the time of such purchase or in default 30 within one year after such purchase; (ii) the licensee fails to give written 31 notice of the purchase, within 20 days thereafter, to the mortgage holder; 32 and (iii) the licensee, unless otherwise required by law or court order, 33 fails to apply any rent proceeds from the dwellings to the mortgage as the 34 payments come due, regardless of whether the licensee is obligated on 35 the loan; or 36 (C) the licensee fails to notify, at the time of rental, any person rent- 37 ing any such dwelling of the extent and nature of the licensee's interest 38 in such dwelling and the probable time until possession will be taken by 39 the mortgage holder or judgment creditor. 40 (38) Commit forgery or, unless authorized to do so by a duly executed 41 power of attorney, sign or initial any contractual agreement on behalf of 42 another person in a real estate transaction. 43 (b) In any transaction regarding the sale or lease of commercial or HB 2264--Am. 24 1 investment real estate property failure to comply with any requirement 2 of subsection (a)(14), (15), (16) or (17) or their corollary rules and regu- 3 lations shall not by itself render any agreement void or voidable nor shall 4 it constitute a defense to any action to enforce such agreement or any 5 action for breach of such agreement. 6 (c) The commission may provide suggested forms of agency disclo- 7 sure and agency agreements and, by rules and regulations, provide such 8 other prohibitions, limitations and conditions relating thereto as the com- 9 mission may prescribe for transactions regarding the sale or lease of com- 10 mercial or investment real estate property. 11 (d) No salesperson or associate broker shall: 12 (1) Accept a commission or other valuable consideration from anyone 13 other than the salesperson's or associate broker's employing broker or the 14 broker with whom the salesperson or associate broker is associated. 15 (2) Fail to place, as soon after receipt as practicable, any deposit 16 money or other funds entrusted to the salesperson or associate broker in 17 the custody of the broker whom the salesperson or associate broker rep- 18 resents. 19 (e) No broker shall: 20 (1) Pay a commission or compensation to any person for performing 21 the services of an associate broker or salesperson unless such person is 22 licensed under this act and employed by or associated with the broker, 23 except that nothing herein shall prohibit the payment of a referral fee to 24 a person who is properly licensed as a broker or salesperson in another 25 jurisdiction relating to a transaction regarding the sale or lease of com- 26 mercial or investment real estate property. 27 (2) Fail to deliver to the seller in every real estate transaction, at the 28 time the transaction is closed, a complete, detailed closing statement 29 showing all of the receipts and disbursements handled by the broker for 30 the seller, or fail to deliver to the buyer a complete statement showing 31 all money received in the transaction from such buyer and how and for 32 what the same was disbursed, or fail to retain true copies of such state- 33 ments in the broker's files, except that the furnishing of such statements 34 to the seller and buyer by an escrow agent shall relieve the broker's re- 35 sponsibility to the seller and the buyer. 36 (3) Fail to properly supervise the activities of an associated or em- 37 ployed salesperson or associate broker. 38 (4) Lend the broker's license to a salesperson, or permit a salesperson 39 to operate as a broker. 40 (5) Fail to provide to the principal a written report every 30 days, 41 along with a final report, itemizing disbursements made by the broker 42 from advance listing fees. 43 (f) If a purchase agreement provides that the earnest money be held HB 2264--Am. 25 1 by an escrow agent other than a real estate broker, unless otherwise spe- 2 cifically provided by written agreement of all parties to the purchase 3 agreement, no listing broker shall: 4 (1) Fail to deliver the purchase agreement and earnest money deposit 5 to the escrow agent named in the purchase agreement within five business 6 days after the purchase agreement is signed by all parties; or 7 (2) fail to obtain and keep in the transaction file a receipt from the 8 escrow agent showing date of delivery of the purchase agreement and 9 earnest money deposit. 10 (g) Nothing in this section shall be construed to grant any person a 11 private right of action for damages or to eliminate any right of action 12 pursuant to other statutes or common law. 13 Sec. 14. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3062, 14 as revived by section 13 of this act, is hereby amended to read as follows: 15 58-3062. (a) No licensee, whether acting as an agent or a principal, shall: 16 (1) Intentionally use advertising that is misleading or inaccurate in 17 any material particular or that in any way misrepresents any property, 18 terms, values, policies or services of the business conducted, or uses the 19 trade name, collective membership mark, service mark or logo of any 20 organization owning such name, mark or logo without being authorized 21 to do so. 22 (2) Fail to account for and remit any money which comes into the 23 licensee's possession and which belongs to others. 24 (3) Misappropriate moneys required to be deposited in a trust ac- 25 count pursuant to K.S.A. 58-3061 and amendments thereto, convert such 26 moneys to the licensee's personal use or commingle the money or other 27 property of the licensee's principals with the licensee's own money or 28 property, except that nothing herein shall prohibit a broker from having 29 funds in an amount not to exceed $100 in the broker's trust account to 30 pay expenses for the use and maintenance of such account. 31 (4) Accept, give or charge any rebate or undisclosed commission. 32 (5) Pay a referral fee to a person who is properly licensed as a broker 33 or salesperson in another jurisdiction or who holds a corporate real estate 34 license in another jurisdiction if the licensee knows that the payment of 35 the referral fee will result in the payment of a rebate by the out-of-state 36 licensee. 37 (6) Represent or attempt to represent a broker without the broker's 38 express knowledge and consent. 39 (7) Act in a dual capacity of agent and undisclosed principal in any 40 transaction regarding the sale or lease of commercial or investment real 41 estate property. 42 (8) Guarantee or authorize any person to guarantee future profits that 43 may result from the resale of real property. HB 2264--Am. 26 1 (9) (8) Place a sign on any property offering it for sale or lease without 2 the written consent of the owner or the owner's authorized agent. 3 (10) (9) Offer real estate for sale or lease without the knowledge and 4 consent of the owner or the owner's authorized agent or on terms other 5 than those authorized by the owner or the owner's authorized agent. 6 (11) (10) Induce any party to break any agency agreement or contract 7 of sale or lease. 8 (12) Solicit a listing or negotiate a sale, exchange or lease of com- 9 mercial or investment real estate property directly with an owner or lessor 10 if the licensee knows that such owner or lessor has, with regard to the 11 property, a written agency agreement granting an exclusive right to sell 12 or lease to another broker. 13 (13) Solicit an agency agreement or negotiate a sale, exchange or lease 14 of commercial or investment real estate property directly with a buyer or 15 lessee if the licensee knows that such buyer or lessee has a written agency 16 agreement granting exclusive representation to another broker. 17 (14) Except for a commercial or investment real estate property or 18 any property owned by any agency of the federal government, fail to 19 obtain a written agency agreement, including a fixed date of expiration, 20 signed by the party to be represented and by the licensee or fail to furnish 21 a copy of the agreement to the principal within a reasonable time. The 22 licensee shall not assign, sell or otherwise transfer a written agency agree- 23 ment to another broker without the express written consent of all parties 24 to the original listing agreement. 25 (15) In any transaction regarding the sale of commercial or invest- 26 ment real estate property if the licensee represents the seller, fail to dis- 27 close to a prospective buyer that: (A) The licensee is or will be acting as 28 agent of the seller with the duty to represent the seller's interest; (B) the 29 licensee will not be the agent of the prospective buyer; and (C) infor- 30 mation given to the licensee will be disclosed to the seller. The disclosure 31 shall be made orally or in writing when the licensee agrees to assist the 32 prospective buyer to locate and inspect property and shall be made in any 33 contract for sale and in any lot reservation agreement. 34 (16) In any transaction regarding the sale of commercial or invest- 35 ment real estate property if the licensee represents the buyer, fail to 36 disclose to a prospective seller or seller's agent that: (A) The licensee is 37 or will be acting as agent of the buyer with the duty to represent the 38 buyer's interest; (B) the licensee will not be the agent of the seller; and 39 (C) information given to the licensee will be disclosed to the buyer. The 40 disclosure shall be made orally or in writing no later than the first showing 41 of the property and shall be made in any contract for sale and in any lot 42 reservation agreement. 43 (17) In any transaction regarding the sale of commercial or invest- HB 2264--Am. 27 1 ment real estate property if the licensee represents both the buyer and 2 seller, the licensee shall immediately disclose in writing: (A) That the 3 licensee is acting as agent for both buyer and seller; and (B) the com- 4 pensation arrangement. The disclosure shall be signed by both the buyer 5 and the seller. If the exclusive right to sell agreement and the buyer's 6 agency agreement include the disclosure of the possibility of dual agency, 7 the written disclosure, for each specific transaction, shall be signed by the 8 buyer no later than the first showing of the property and by the seller no 9 later than the presentation of the offer to purchase. In addition, the dis- 10 closure of the agency relationship between all licensees involved and the 11 principals shall be included in any contract for sale and in any lot reser- 12 vation agreement. 13 (18) (11) Offer or give prizes, gifts or gratuities which are contingent 14 upon an agency agreement or the sale, purchase or lease of real estate. 15 (19) Enter into a listing agreement on commercial or investment real 16 estate property in which the broker's commission is based upon the dif- 17 ference between the gross sales price and the net proceeds to the owner. 18 (20) (12) Fail to see that financial obligations and commitments be- 19 tween the parties to an agreement to sell, exchange or lease real estate 20 are in writing, expressing the exact agreement of the parties or to provide, 21 within a reasonable time, copies thereof to all parties involved. 22 (21) (13) Procure a signature to a purchase contract which has no 23 definite purchase price, method of payment, description of property or 24 method of determining the closing date. 25 (22) Include in any agency agreement an authorization to sign or 26 initial any document on behalf of the licensee's principal in a commercial 27 or investment real estate property transaction or authorization to act as 28 attorney-in-fact for the principal. 29 (23) (14) Engage in fraud or make any substantial misrepresentation. 30 (24) (15) Represent to any lender, guaranteeing agency or any other 31 interested party, either verbally or through the preparation of false doc- 32 uments, an amount in excess of the true and actual sale price of the real 33 estate or terms differing from those actually agreed upon. 34 (25) (16) Fail to make known to any purchaser or lessee any interest 35 the licensee has in the real estate the licensee is selling or leasing or to 36 make known to any seller or lessor any interest the licensee will have in 37 the real estate the licensee is purchasing or leasing. 38 (26) (17) Fail to inform both the buyer, at the time an offer is made, 39 and the seller, at the time an offer is presented, that certain closing costs 40 must be paid and the approximate amount of such costs. 41 (27) (18) Fail without just cause to surrender any document or in- 42 strument to the rightful owner. 43 (28) (19) Accept anything other than cash as earnest money unless HB 2264--Am. 28 1 that fact is communicated to the owner prior to the owner's acceptance 2 of the offer to purchase, and such fact is shown in the purchase agree- 3 ment. 4 (29) (20) Fail to deposit any check or cash received as an earnest 5 money deposit or as a deposit on the purchase of a lot within five business 6 days after the purchase agreement or lot reservation agreement is signed 7 by all parties, unless otherwise specifically provided by written agreement 8 of all parties to the purchase agreement or lot reservation agreement, in 9 which case the licensee shall deposit the check or cash received on the 10 date provided by such written agreement. 11 (30) (21) Fail in response to a request by the commission or the di- 12 rector to produce any document, book or record in the licensee's posses- 13 sion or under the licensee's control that concerns, directly or indirectly, 14 any real estate transaction or the licensee's real estate business. 15 (31) In any transaction regarding the sale of commercial or invest- 16 ment real estate property if the licensee represents the seller, fail to 17 promptly submit any written offer to the licensee's principal when such 18 offer is received prior to the closing of the sale or fail to promptly submit 19 to the prospective buyer or buyer's agent any counteroffer made by the 20 seller, including any back-up offers properly identified as such. 21 (32) In any transaction regarding the sale of commercial or invest- 22 ment real estate property if the licensee represents the buyer, fail to 23 promptly submit any written offer to the seller or seller's agent or fail to 24 promptly submit to the licensee's principal any counteroffer made by the 25 seller, including any back-up offers properly identified as such. 26 (33) (22) Refuse to appear or testify under oath at any hearing held 27 by the commission. 28 (34) (23) Demonstrate incompetency to act as a broker, associate bro- 29 ker or salesperson. 30 (35) In any transaction regarding the sale or lease of commercial or 31 investment real estate property fail to disclose, or ascertain and disclose, 32 to any person with whom the licensee is dealing, any material information 33 which relates to the property with which the licensee is dealing and which 34 such licensee knew or should have known. 35 (36) (24) Knowingly receive or accept, directly or indirectly, any re- 36 bate, reduction or abatement of any charge, or any special favor or ad- 37 vantage or any monetary consideration or inducement, involving the is- 38 suance of a title insurance policy or contract concerning which the 39 licensee is directly or indirectly connected, from a title insurance company 40 or title insurance agent, or any officer, employee, attorney, agent or so- 41 licitor thereof. 42 (37) (25) Engage in the purchase of one-, two-, three- or four-family 43 dwellings, including condominiums and cooperatives, or the acquisition HB 2264--Am. 29 1 of any right, title or interest therein, including any equity or redemption 2 interests, if: 3 (A) (i) At the time of such purchase, the dwellings are subject to a 4 right of redemption pursuant to foreclosure of a mortgage on such dwell- 5 ings; (ii) the licensee fails to give written notice of the purchase, within 6 20 days thereafter, to the mortgage holder or judgment creditor who held 7 such mortgage; and (iii) the licensee, unless otherwise required by law or 8 court order, fails to apply any rent proceeds from the dwellings to the 9 judgment lien arising from the foreclosure of such mortgage, as payments 10 become due under the loan, regardless of whether the licensee is obli- 11 gated to do so; 12 (B) (i) the dwellings are subject to a loan which is secured by a mort- 13 gage and which is in default at the time of such purchase or in default 14 within one year after such purchase; (ii) the licensee fails to give written 15 notice of the purchase, within 20 days thereafter, to the mortgage holder; 16 and (iii) the licensee, unless otherwise required by law or court order, 17 fails to apply any rent proceeds from the dwellings to the mortgage as the 18 payments come due, regardless of whether the licensee is obligated on 19 the loan; or 20 (C) the licensee fails to notify, at the time of rental, any person rent- 21 ing any such dwelling of the extent and nature of the licensee's interest 22 in such dwelling and the probable time until possession will be taken by 23 the mortgage holder or judgment creditor. 24 (38) (26) Commit forgery or, unless authorized to do so by a duly 25 executed power of attorney, sign or initial any contractual agreement on 26 behalf of another person in a real estate transaction. 27 (b) In any transaction regarding the sale or lease of commercial or 28 investment real estate property failure to comply with any requirement 29 of subsection (a)(14), (15), (16) or (17) or their corollary rules and regu- 30 lations shall not by itself render any agreement void or voidable nor shall 31 it constitute a defense to any action to enforce such agreement or any 32 action for breach of such agreement. 33 (c) The commission may provide suggested forms of agency disclo- 34 sure and agency agreements and, by rules and regulations, provide such 35 other prohibitions, limitations and conditions relating thereto as the com- 36 mission may prescribe for transactions regarding the sale or lease of com- 37 mercial or investment real estate property. 38 (d) No salesperson or associate broker shall: 39 (1) Except as provided in paragraph (A) or (B), accept a commission 40 or other valuable consideration from anyone other than the salesperson's 41 or associate broker's employing broker or the broker with whom the sa- 42 lesperson or associate broker is associated. broker by whom the licensee 43 is employed or with whom the licensee is associated as an independent HB 2264--Am. 30 1 contractor. 2 (A) A salesperson or associate broker may accept a commission or 3 other valuable consideration from a licensee who employs the salesperson 4 or associate broker as a personal assistant provided that: (i) the licensee 5 and the salesperson or associate broker who is employed as a personal 6 assistant are licensed under the supervision of the same broker, and (ii) 7 the supervising broker agrees in writing that the personal assistant may 8 be paid by the licensee. 9 (B) If a salesperson or associate broker has (i) organized as a profes- 10 sional corporation pursuant to K.S.A. 17-2706 et seq., and amendments 11 thereto, (ii) incorporated under the Kansas general corporation code con- 12 tained in K.S.A. 17-6001 et seq., and amendments thereto, (iii) organized 13 under the Kansas limited liability company act contained in K.S.A. 17- 14 7601 et seq., and amendments thereto, or (iv) has organized as a registered 15 limited liability partnership as defined in K.S.A. 56-302 and amendments 16 thereto, the commission or other valuable consideration may be paid by 17 the licensee's broker to such professional corporation, corporation, limited 18 liability company or limited liability partnership. This provision shall not 19 alter any other provisions of this act. 20 (2) Fail to place, as soon after receipt as practicable, any deposit 21 money or other funds entrusted to the salesperson or associate broker in 22 the custody of the broker whom the salesperson or associate broker rep- 23 resents. 24 (e) (c) No broker shall: 25 (1) Pay a commission or compensation to any person for performing 26 the services of an associate broker or salesperson unless such person is 27 licensed under this act and employed by or associated with the broker, 28 except that nothing herein shall prohibit the payment of a referral fee to 29 a person who is properly licensed as a broker or salesperson in another 30 jurisdiction relating to a transaction regarding the sale or lease of com- 31 mercial or investment real estate property. 32 (2) Fail to deliver to the seller in every real estate transaction, at the 33 time the transaction is closed, a complete, detailed closing statement 34 showing all of the receipts and disbursements handled by the broker for 35 the seller, or fail to deliver to the buyer a complete statement showing 36 all money received in the transaction from such buyer and how and for 37 what the same was disbursed, or fail to retain true copies of such state- 38 ments in the broker's files, except that the furnishing of such statements 39 to the seller and buyer by an escrow agent shall relieve the broker's re- 40 sponsibility to the seller and the buyer. 41 (3) Fail to properly supervise the activities of an associated or em- 42 ployed salesperson or associate broker. 43 (4) Lend the broker's license to a salesperson, or permit a salesperson HB 2264--Am. 31 1 to operate as a broker. 2 (5) Fail to provide to the principal a written report every 30 days, 3 along with a final report, itemizing disbursements made by the broker 4 from advance listing fees. 5 (f) (d) (1) If a purchase agreement provides that the earnest money 6 be held by an escrow agent other than a real estate broker, unless oth- 7 erwise specifically provided by written agreement of all parties to the 8 purchase agreement, no listing broker shall: 9 (1) (A) Fail to deliver the purchase agreement and earnest money 10 deposit to the escrow agent named in the purchase agreement within five 11 business days after the purchase agreement is signed by all parties unless 12 otherwise specifically provided by written agreement of all parties to the 13 purchase agreement, in which case the broker shall deliver the purchase 14 agreement and earnest money deposit to the escrow agent named in the 15 purchase agreement on the date provided by such written agreement; or 16 (2) (B) fail to obtain and keep in the transaction file a receipt from 17 the escrow agent showing date of delivery of the purchase agreement and 18 earnest money deposit. 19 (2) If a purchase agreement provides that the earnest money be held 20 by an escrow agent other than a real estate broker and the property was 21 not listed with a broker, no broker for the buyer shall: 22 (A) Fail to deliver the purchase agreement and earnest money deposit 23 to the escrow agent named in the purchase agreement within five business 24 days after the purchase agreement is signed by all parties unless otherwise 25 specifically provided by written agreement of all parties to the purchase 26 agreement, in which case the broker shall deliver the purchase agreement 27 and earnest money deposit to the escrow agent named in the purchase 28 agreement on the date provided by such written agreement; or 29 (B) fail to obtain and keep in the transaction file a receipt from the 30 escrow agent showing date of delivery of the purchase agreement and 31 earnest money deposit. 32 (3) If a purchase agreement provides that the earnest money be held 33 by an escrow agent other than a real estate broker and neither the seller 34 not nor buyer is represented by a broker, no transaction broker shall: 35 (A) Fail to deliver the purchase agreement and earnest money deposit 36 to the escrow agent named in the purchase agreement within five business 37 days after the purchase agreement is signed by all parties unless otherwise 38 specifically provided by written agreement of all parties to the purchase 39 agreement, in which case the broker shall deliver the purchase agreement 40 and earnest money deposit to the escrow agent named in the purchase 41 agreement on the date provided by such written agreement; or 42 (B) fail to obtain and keep in the transaction file a receipt from the 43 escrow agent showing date of delivery of the purchase agreement and HB 2264--Am. 32 1 earnest money deposit. 2 The commission may adopt rules and regulations to require that any 3 such purchase agreement which provides that the earnest money be held 4 by an escrow agent other than a real estate broker include: (1) notification 5 of whether or not the escrow agent named in the purchase agreement 6 maintains a surety bond, and (2) notification that rules and regulations 7 statutes governing the disbursement of earnest money held in trust ac- 8 counts of real estate brokers do not apply to earnest money deposited with 9 the escrow agent named in the purchase agreement. 10 (g) (e) Nothing in this section shall be construed to grant any person 11 a private right of action for damages or to eliminate any right of action 12 pursuant to other statutes or common law. 13 Sec. 15. On and after October 1, 1997, K.S.A. 58-3063 is hereby 14 amended to read as follows: 58-3063. (a) The commission shall adopt rules 15 and regulations fixing the amounts of the fees provided for by this act, 16 subject to the following: 17 (1) For any examination required for licensure, a fee in an amount 18 equal to the actual cost of the examination and the administration thereof. 19 (2) For submission of an application for an original salesperson's li- 20 cense, an amount not exceeding $25. 21 (3) for submission of an application for an original broker's license, 22 an amount not exceeding $50. 23 (4) For an original salesperson's license, a prorated fee based on an 24 annual a two-year amount not exceeding $50 $100. 25 (5) For an original broker's license, a prorated fee based on an annual 26 a two-year amount not exceeding $75 $150. 27 (6) For renewal of a salesperson's license, a fee based on an annual 28 a two-year amount not exceeding $50 $100. 29 (7) For renewal of a broker's license, a fee based on an annual a two- 30 year amount not exceeding $75 $150. 31 (8) For reinstatement of a license which has been deactivated or 32 which has been canceled pursuant to subsection (d) of K.S.A. 58-3047 33 and amendments thereto, or by reason of termination of a salesperson, 34 an amount not exceeding $15. 35 (9) For reinstatement of all licenses canceled pursuant to subsection 36 (e) of K.S.A. 58-3047 and amendments thereto, an amount not exceeding 37 $7.50 for each license canceled. 38 (10) For issuance of a duplicate license, an amount not exceeding 39 $10. 40 (11) For certification of licensure to another jurisdiction, an amount 41 not exceeding $10. 42 (12) For approval of a course of instruction submitted by a course 43 provider pursuant to K.S.A. 58-3046a and amendments thereto, an HB 2264--Am. 33 1 amount not exceeding $75. 2 (13) For renewal of an approved course of instruction pursuant to 3 K.S.A. 58-3046a and amendments thereto, an amount not exceeding $15. 4 (14) For approval of a course of instruction submitted by any licensee 5 for credit toward the 12 hours of additional instruction required by K.S.A. 6 58-3046a and amendments thereto, an amount not less than $10 nor more 7 than $20, as determined by the commission. 8 (15) For a temporary salesperson's license, an amount not exceeding 9 $25. 10 (b) For each prorated fee, the commission shall establish a monthly 11 amount, rounded off to the nearest dollar, and shall compute the fee from 12 the last calendar day of the month in which the license is issued to the 13 expiration date of the license. 14 (b) (c) Subject to the limitations of this section, the commission shall 15 fix the fees provided for by this section in the amounts necessary to ad- 16 minister and enforce this act. 17 (c) (d) The fees provided for by this section shall be applicable re- 18 gardless of the type of license. 19 Sec. 16. On and after July 1, 1997, K.S.A. 1996 Supp. 58-3064 is 20 hereby revived to read as follows: 58-3064. Whenever any person has 21 engaged in any act or practice that constitutes a violation of this act or 22 rules and regulations adopted hereunder or the brokerage relationships 23 in real estate transactions act or rules and regulations adopted thereunder 24 as such act governs the sale or lease of real estate that is one to four 25 residential units, the commission may institute an action in the district 26 court of the county in which the person resides or in the district court in 27 the county in which such act or practice occurred for an injunction to 28 enforce compliance with the act or rules and regulations. The commission 29 shall not be required to give any bond or pay any filing fee for initiating 30 such action. Upon a showing that the person has engaged in any act or 31 practice in violation of the act or rules and regulations, the court may 32 enjoin all such acts or practices and may make any orders necessary to 33 conserve, protect and disburse any funds involved. 34 Sec. 17. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3064, 35 as revived by section 16 of this act, is hereby amended to read as follows: 36 58-3064. Whenever any person has engaged in any act or practice that 37 constitutes a violation of this act or rules and regulations adopted here- 38 under or the brokerage relationships in real estate transactions act or rules 39 and regulations adopted thereunder as such act governs the sale or lease 40 of real estate that is one to four residential units, the commission may 41 institute an action in the district court of the county in which the person 42 resides or in the district court in the county in which such act or practice 43 occurred for an injunction to enforce compliance with the act or rules HB 2264--Am. 34 1 and regulations. The commission shall not be required to give any bond 2 or pay any filing fee for initiating such action. Upon a showing that the 3 person has engaged in any act or practice in violation of the act or rules 4 and regulations, the court may enjoin all such acts or practices and may 5 make any orders necessary to conserve, protect and disburse any funds 6 involved. 7 Sec. 18. On and after July 1, 1997, K.S.A. 1996 Supp. 58-3065 is 8 hereby revived to read as follows: 58-3065. (a) Willful violation of any 9 provision of this act or the brokerage relationships in real estate trans- 10 actions act, as such act governs the sale or lease of real estate that is one 11 to four residential units, is a misdemeanor punishable by imprisonment 12 for not more than 12 months or a fine of not less than $100 or more than 13 $1,000, or both, for the first offense and imprisonment for not more than 14 12 months or a fine of not less than $1,000 or more than $10,000, or 15 both, for a second or subsequent offense. 16 (b) Nothing in this act or the brokerage relationships in real estate 17 transactions act, as such act governs the sale or lease of real estate that is 18 one to four residential units, shall be construed as requiring the commis- 19 sion or the director to report minor violations of the acts for criminal 20 prosecution whenever the commission or the director believes that the 21 public interest will be adequately served by other administrative action. 22 Sec. 19. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3065, 23 as revived by section 18 of this act, is hereby amended to read as follows: 24 58-3065. (a) Willful violation of any provision of this act or the brokerage 25 relationships in real estate transactions act, as such act governs the sale 26 or lease of real estate that is one to four residential units, is a misdemeanor 27 punishable by imprisonment for not more than 12 months or a fine of 28 not less than $100 or more than $1,000, or both, for the first offense and 29 imprisonment for not more than 12 months or a fine of not less than 30 $1,000 or more than $10,000, or both, for a second or subsequent offense. 31 (b) Nothing in this act or the brokerage relationships in real estate 32 transactions act, as such act governs the sale or lease of real estate that is 33 one to four residential units, shall be construed as requiring the commis- 34 sion or the director to report minor violations of the acts for criminal 35 prosecution whenever the commission or the director believes that the 36 public interest will be adequately served by other administrative action. 37 Sec. 20. On and after July 1, 1997, K.S.A. 1996 Supp. 58-3068 is 38 hereby revived to read as follows: 58-3068. (a) Moneys in the real estate 39 recovery revolving fund shall be used in the manner provided by this act 40 to reimburse persons who suffer monetary damages by reason of any of 41 the following acts committed in connection with any transaction involving 42 the sale of real estate in this state by any broker or salesperson who was 43 licensed under the laws of this state at the time the act was committed HB 2264--Am. 35 1 or by any unlicensed employee of such broker or salesperson: 2 (1) Violation of any of the following provisions of this act: 3 (A) K.S.A. 58-3061 and amendments thereto; or 4 (B) subsection (a)(2), (3), (23), (28) or (29) or subsection (d)(2) of 5 K.S.A. 58-3062 and amendments thereto; or 6 (2) violation of any provision of the brokerage relationships in real 7 estate transactions act, as such act governs the sale or lease of real estate 8 that is one to four residential units; or 9 (3) obtaining money or property by any act which would constitute 10 any crime defined by K.S.A. 21-3701, 21-3704, 21-3705, 21-3706, 21- 11 3707, 21-3710, 21-3711 or 21-3712, and amendments thereto. 12 (b) Any person may seek recovery from the real estate recovery re- 13 volving fund under the following conditions: 14 (1) Such person has received final judgment in a court of competent 15 jurisdiction of this state in any action wherein the cause of action was 16 based on any of the acts described in subsection (a); 17 (2) the claim is made within two years after the date that final judg- 18 ment is entered; 19 (3) such person has caused to be issued a writ of execution upon such 20 judgment, and the officer executing the same has made a return showing 21 that no personal or real property of the judgment debtor liable to be 22 levied upon in satisfaction of the judgment could be found, or that the 23 amount realized on the sale of the judgment debtor's property pursuant 24 to such execution was insufficient to satisfy the judgment; 25 (4) such person has made all reasonable searches and inquiries to 26 ascertain whether the judgment debtor is possessed of real or personal 27 property or other assets, subject to being sold or applied in satisfaction 28 of the judgment, and by such search such person has discovered no such 29 property or assets, or that such person has discovered such property and 30 assets and that such person has taken all necessary action and proceedings 31 for the application thereof to the judgment and that the amount thereby 32 realized was insufficient to satisfy the judgment; 33 (5) any amounts recovered by such person from the judgment debtor, 34 or from any other source, has been applied to the damages awarded by 35 the court; and 36 (6) such person is not a person who is precluded by subsection (c) 37 from making a claim for recovery. 38 (c) A person shall not be qualified to make a claim for recovery from 39 the real estate recovery revolving fund, if: 40 (1) The person is the spouse of the judgment debtor or a personal 41 representative of such spouse; 42 (2) the person acted as principal or agent in the real estate transaction 43 which is the subject of the claim and is a licensed broker or salesperson HB 2264--Am. 36 1 or is a partnership, association, limited liability company or corporation 2 whose partners, members, officers and employees are licensed as pro- 3 vided by subsection (b) of K.S.A. 58-3042 and amendments thereto; or 4 (3) such person's claim is based upon a real estate transaction in 5 which the licensed broker or salesperson was acting on the broker's or 6 salesperson's own behalf with respect to property owned or controlled by 7 such broker or salesperson. 8 Sec. 21. On and after October 1, 1997, K.S.A. 1996 Supp. 58-3068, 9 as revived by section 20 of this act, is hereby amended to read as follows: 10 58-3068. (a) Moneys in the real estate recovery revolving fund shall be 11 used in the manner provided by this act to reimburse persons who suffer 12 monetary damages by reason of any of the following acts committed in 13 connection with any transaction involving the sale of real estate in this 14 state by any broker or salesperson who was licensed under the laws of 15 this state at the time the act was committed or by any unlicensed em- 16 ployee of such broker or salesperson: 17 (1) Violation of any of the following provisions of this act: 18 (A) K.S.A. 58-3061 and amendments thereto; or 19 (B) subsection (a)(2), (3), (23), (28) or (29) (14), (19) or (20) or sub- 20 section (d)(2) (b)(2) of K.S.A. 58-3062 and amendments thereto; or 21 (2) violation of any provision of the brokerage relationships in real 22 estate transactions act, as such act governs the sale or lease of real estate 23 that is one to four residential units; or 24 (3) obtaining money or property by any act which would constitute 25 any crime defined by K.S.A. 21-3701, 21-3704, 21-3705, 21-3706, 21- 26 3707, 21-3710, 21-3711 or 21-3712, and amendments thereto. 27 (b) Any person may seek recovery from the real estate recovery re- 28 volving fund under the following conditions: 29 (1) Such person has received final judgment in a court of competent 30 jurisdiction of this state in any action wherein the cause of action was 31 based on any of the acts described in subsection (a); 32 (2) the claim is made within two years after the date that final judg- 33 ment is entered; 34 (3) such person has caused to be issued a writ of execution upon such 35 judgment, and the officer executing the same has made a return showing 36 that no personal or real property of the judgment debtor liable to be 37 levied upon in satisfaction of the judgment could be found, or that the 38 amount realized on the sale of the judgment debtor's property pursuant 39 to such execution was insufficient to satisfy the judgment; 40 (4) such person has made all reasonable searches and inquiries to 41 ascertain whether the judgment debtor is possessed of real or personal 42 property or other assets, subject to being sold or applied in satisfaction 43 of the judgment, and by such search such person has discovered no such HB 2264--Am. 37 1 property or assets, or that such person has discovered such property and 2 assets and that such person has taken all necessary action and proceedings 3 for the application thereof to the judgment and that the amount thereby 4 realized was insufficient to satisfy the judgment; 5 (5) any amounts recovered by such person from the judgment debtor, 6 or from any other source, has been applied to the damages awarded by 7 the court; and 8 (6) such person is not a person who is precluded by subsection (c) 9 from making a claim for recovery. 10 (c) A person shall not be qualified to make a claim for recovery from 11 the real estate recovery revolving fund, if: 12 (1) The person is the spouse of the judgment debtor or a personal 13 representative of such spouse; 14 (2) the person acted as principal or agent in the real estate transaction 15 which is the subject of the claim and is a licensed broker or salesperson 16 or is a partnership, association, limited liability company or corporation 17 whose partners, members, officers and employees are licensed as pro- 18 vided by subsection (b) of K.S.A. 58-3042 and amendments thereto; or 19 (3) such person's claim is based upon a real estate transaction in 20 which the licensed broker or salesperson was acting on the broker's or 21 salesperson's own behalf with respect to property owned or controlled by 22 such broker or salesperson. 23 Sec. 22. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,101 is 24 hereby revived and amended to read as follows: 58-30,101. (a) K.S.A. 25 1996 Supp. 58-30,101 through 58-30,112 shall be known and may be cited 26 as the brokerage relationships in real estate transactions act. 27 (b) Any application of this act to transactions regarding the sale or 28 lease of commercial or investment real estate property shall be suspended 29 and shall not be enforceable on and after the effective date of this act. 30 Commercial or investment real estate property means any real estate for 31 which the present or intended use is other than one to four residential 32 units. 33 (c) The provisions of K.S.A. 1996 Supp. 58-30,101 through 58-30,112 34 shall be and hereby are abolished on July 1, 1997. 35 Sec. 23. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,101, 36 as revived and amended by section 22 of this act, is hereby amended to 37 read as follows: 58-30,101. (a) K.S.A. 1996 Supp. 58-30,101 through 58- 38 30,112 This act shall be known and may be cited as the brokerage rela- 39 tionships in real estate transactions act. 40 (b) Any application of this act to transactions regarding the sale or 41 lease of commercial or investment real estate property shall be suspended 42 and shall not be enforceable on and after the effective date of this act. 43 Commercial or investment real estate property means any real estate for HB 2264--Am. 38 1 which the present or intended use is other than one to four residential 2 units. The provisions of the brokerage relationships in real estate trans- 3 actions act shall supersede the duties and responsibilities of the parties 4 under the common law, including fiduciary responsibilities of an agent to 5 a principal. 6 (c) Failure to comply with any requirement of K.S.A. 58-30,103 or 7 K.S.A. 58-30,110, and amendments thereto, or rules and regulations 8 adopted thereunder, shall not by itself render any agreement void or void- 9 able nor shall it constitute a defense to any action to enforce such agree- 10 ment or any action for breach of such agreement. 11 Sec. 24. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,102 is 12 hereby revived to read as follows: 58-30,102. As used in the brokerage 13 relationships in real estate transactions act, unless the context otherwise 14 requires: 15 (a) ``Affiliated licensee'' means any individual licensed as a salesper- 16 son or broker under the Kansas real estate brokers' and salespersons' 17 license act who is employed by a broker or affiliated with a broker as an 18 independent contractor. 19 (b) ``Agency'' means every relationship in which a broker acts for or 20 represents another, by the latter's express written authority, in a real es- 21 tate transaction. ``Agency'' also means the relationship in which a broker, 22 by verbal authorization pursuant to subsection (d)(2) of K.S.A. 1996 Supp. 23 58-30,103, acts for or represents any agency of the federal government 24 in the sale of property owned by the federal agency. 25 (c) ``Agency agreement'' means a written agreement setting forth the 26 terms and conditions of the relationship between a broker and the brok- 27 er's client. 28 (d) ``Broker'' means: (1) An individual who is licensed as a broker 29 under the Kansas real estate brokers' and salespersons' license act and 30 who has an agency with a seller, buyer, landlord or tenant; or (2) a cor- 31 poration, partnership, association or limited liability company, of which 32 the officers and members, or persons employed by or associated with the 33 corporation, partnership, association or limited liability company, are li- 34 censed pursuant to K.S.A. 58-3042 and amendments thereto and which 35 has an agency with a seller, buyer, landlord or tenant. The term ``broker'' 36 includes the broker's affiliated licensees except where the context would 37 otherwise indicate. If an individual broker is indicated by the context, the 38 term ``broker'' means the supervising broker as defined by K.S.A. 58- 39 3035 and amendments thereto. 40 (e) ``Brokerage firm'' means the business entity of a broker, whether 41 a proprietorship, partnership, corporation, association or limited liability 42 company. 43 (f) ``Buyer's agent'' means a broker who has an agency with a buyer. HB 2264--Am. 39 1 The term includes the broker's affiliated licensees. 2 (g) ``Client'' means a seller, landlord, buyer or tenant who has an 3 agency with a broker. 4 (h) ``Commission'' means the Kansas real estate commission. 5 (i) ``Confidential information'' means information made confidential 6 by statute, rule, regulation or instructions from the client unless the in- 7 formation is made public or becomes public by the words or conduct of 8 the client to whom the information pertains or from a source other than 9 the licensee. 10 (j) ``Customer'' means a seller, landlord, buyer or tenant in a real 11 estate transaction in which a broker is involved but who has not entered 12 into an agency with the broker. 13 (k) ``Designated agent'' means a licensee affiliated with a broker who 14 has been designated by the broker, or the broker's duly authorized rep- 15 resentative, to act as the agent of a broker's buyer client to the exclusion 16 of all other affiliated licensees. 17 (l) ``Disclosed dual agent'' means a broker who, with the written in- 18 formed consent of all parties to a contemplated real estate transaction, 19 has entered into an agency with and therefore represents both the seller 20 and buyer or both the landlord and tenant. The term includes the broker's 21 affiliated licensees. 22 (m) ``Landlord's agent'' means a broker who has entered into an 23 agency with a landlord. The term includes the broker's affiliated licensees. 24 (n) ``Licensee'' means any person licensed under the Kansas real es- 25 tate brokers' and salespersons' license act as a broker or salesperson. 26 (o) ``Seller's agent'' means a broker who has an agency with a seller. 27 The term includes the broker's affiliated licensees and subagents of the 28 broker. 29 (p) ``Statutory agent'' means a broker who is a seller's agent, a buyer's 30 agent, a landlord's agent, a tenant's agent or a disclosed dual agent in a 31 real estate transaction. 32 (q) ``Tenant's agent'' means a broker who has an agency with a pro- 33 spective tenant. The term includes the broker's affiliated licensees. 34 Sec. 25. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,102, 35 as revived by section 24 of this act, is hereby amended to read as follows: 36 58-30,102. As used in the brokerage relationships in real estate transac- 37 tions act, unless the context otherwise requires: 38 (a) ``Affiliated licensee'' means any individual licensed as a salesper- 39 son or broker under the Kansas real estate brokers' and salespersons' 40 license act who is employed by a broker or affiliated with a broker as an 41 independent contractor. 42 (b) ``Agency'' means every relationship in which a broker acts for or 43 represents another, by the latter's express written authority, in a real es- HB 2264--Am. 40 1 tate transaction. ``Agency'' also means the relationship in which a broker, 2 by verbal authorization pursuant to subsection (d)(2) of K.S.A. 1996 Supp. 3 58-30,103, and amendments thereto, acts for or represents any agency of 4 the federal government in the sale of property owned by the federal 5 agency. 6 (c) ``Agency agreement'' means a written agreement setting forth the 7 terms and conditions of the relationship between a broker and the brok- 8 er's client. 9 (d) ``Broker'' means: (1) An individual who is licensed as a broker 10 under the Kansas real estate brokers' and salespersons' license act and 11 who has an agency with a seller, buyer, landlord or tenant or acts as a 12 transaction broker; or (2) a corporation, partnership, association or lim- 13 ited liability company, of which the officers and members, or persons 14 employed by or associated with the corporation, partnership, association 15 or limited liability company, are licensed pursuant to K.S.A. 58-3042 and 16 amendments thereto and which has an agency with a seller, buyer, land- 17 lord or tenant or acts as a transaction broker. The term ``broker'' in- 18 cludes the broker's affiliated licensees except where the context would 19 otherwise indicate. If an individual broker is indicated by the context, the 20 term ``broker'' means the supervising broker as defined by K.S.A. 58- 21 3035 and amendments thereto. 22 (e) ``Brokerage firm'' means the business entity of a broker, whether 23 a proprietorship, partnership, corporation, association or limited liability 24 company. 25 (f) ``Buyer's agent'' means a broker who has an agency with a buyer. 26 The term includes the broker's affiliated licensees. 27 (g) ``Client'' means a seller, landlord, buyer or tenant who has an 28 agency with a broker. 29 (h) ``Commission'' means the Kansas real estate commission. 30 (i) ``Confidential information'' means information made confidential 31 by statute, rule, regulation or instructions from the client or personal 32 information about the client which might place the other party at an 33 advantage over the client unless the information is made public or be- 34 comes public by the words or conduct of the client to whom the infor- 35 mation pertains or from a source other than the licensee. 36 (j) ``Customer'' means a seller, landlord, buyer or tenant in a real 37 estate transaction in which a broker is involved but who has not entered 38 into an agency with the broker. 39 (k) ``Designated agent'' means a licensee affiliated with a broker who 40 has been designated by the broker, or the broker's duly authorized rep- 41 resentative, to act as the agent of a broker's buyer or seller client to the 42 exclusion of all other affiliated licensees. 43 (l) ``Disclosed dual agent'' means a broker who, with the written in- HB 2264--Am. 41 1 formed consent of all parties to a contemplated real estate transaction, 2 has entered into an agency with and therefore represents both the seller 3 and buyer or both the landlord and tenant. The term includes the broker's 4 affiliated licensees. 5 (m) ``Landlord's agent'' means a broker who has entered into an 6 agency with a landlord. The term includes the broker's affiliated licensees. 7 (n) (m) ``Licensee'' means any person licensed under the Kansas real 8 estate brokers' and salespersons' license act as a broker or salesperson. 9 (n) ``Ministerial acts'' means those acts that a licensee may perform 10 for a person that are informative in nature and do not rise to the level of 11 active representation on behalf of a person. Examples of these acts include, 12 but are not limited to: 13 (1) Responding to telephone inquiries by consumers as to the avail- 14 ability and pricing of brokerage services; 15 (2) responding to telephone inquiries from a person concerning the 16 price or location of property; 17 (3) attending an open house and responding to questions about the 18 property from a consumer; 19 (4) setting an appointment to view property; 20 (5) responding to questions of consumers walking into a licensee's 21 office concerning brokerage services offered on particular properties; 22 (6) accompanying an appraiser, inspector, contractor or similar third 23 party on a visit to a property; 24 (7) describing a property or the property's condition in response to a 25 person's inquiry; or 26 (8) referral to another broker or service provider. 27 (o) ``Seller's agent'' means a broker who has an agency with a seller. 28 The term includes the broker's affiliated licensees and subagents of the 29 broker. 30 (p) ``Qualified third party'' means a federal, state or local govern- 31 mental agency or any person whom the broker, the affiliated licensee or 32 a party to the real estate transaction reasonably believes has the expertise 33 necessary to meet the industry standards of practice for the type of in- 34 spection or investigation that has been conducted by the third party in 35 order to prepare a written report. 36 (q)``Statutory agent'' means a broker who is a seller's agent, a buyer's 37 agent, a landlord's agent, a tenant's agent or a disclosed dual designated 38 agent in a real estate transaction. 39 (q) (r) ``Tenant's agent'' means a broker who has an agency with a 40 prospective tenant. The term includes the broker's affiliated licensees. 41 (s) ``Transaction broker'' means a broker who assists one or more 42 parties with a real estate transaction without being an agent or advocate 43 for the interests of any party to such transaction. The term includes the HB 2264--Am. 42 1 broker's affiliated licensees. 2 Sec. 26. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,103 is 3 hereby revived to read as follows: 58-30,103. (a) A broker shall act only 4 as a statutory agent in any real estate transaction. A licensee may act as a 5 disclosed dual agent but shall not act as an undisclosed dual agent or in 6 a dual capacity of agent and undisclosed principal in any transaction. 7 (b) A broker may work with a single party in separate transactions 8 pursuant to different relationships, including, but not limited to, selling 9 one property as a seller's agent and working with that seller in buying 10 another property as a buyer's agent if the broker complies with this act 11 in establishing the relationships for each transaction. 12 (c) Before an agency agreement is signed, the broker or an affiliated 13 licensee shall advise the prospective buyer or seller of alternative agency 14 relationships pursuant to K.S.A. 1996 Supp. 58-30,110. 15 (d) (1) Except as provided in subsection (d)(2), an agency agreement 16 with a seller or landlord shall be signed prior to the licensee's engaging 17 in any of the activities enumerated in subsection (e) of K.S.A. 58-3035 18 58-3035a and amendments thereto as an employee of, or on behalf of, 19 the seller or landlord. 20 (2) If the real estate which is to be offered for sale is owned by any 21 agency of the federal government, a broker may, on behalf of the owner, 22 engage in activities enumerated in subsection (e) of K.S.A. 58-3035 58- 23 3035a and amendments thereto after obtaining verbal authorization from 24 the federal agency for which services are to be performed. 25 (e) An agency agreement with a buyer or tenant shall be signed at or 26 prior to the first showing of a property if the licensee is acting in the 27 capacity of a buyer's agent. If the first showing is an open house and the 28 buyer seeks representation from the licensee holding the open house: 29 (1) The licensee may obtain a written agency agreement with the 30 buyer and act as a disclosed dual agent pursuant to K.S.A. 1996 Supp. 31 58-30,108; or 32 (2) if the property was not listed by the licensee holding the open 33 house, the licensee may obtain a written agency agreement with the buyer 34 and act as a designated agent pursuant to K.S.A. 1996 Supp. 58-30,109. 35 (f) An agency agreement shall set forth the terms and conditions of 36 the relationship, including a fixed date of expiration, and shall specify the 37 duties and obligations pursuant to K.S.A. 1996 Supp. 58-30,106 or 58- 38 30,107, including, but not limited to, any duty of confidentiality and the 39 terms of compensation. The agreement shall be signed by the party to be 40 represented and by the broker or a licensee affiliated with the broker. A 41 copy of the agreement shall be furnished to the client at the time the 42 client signs the agreement. If, at the time the client signs the agreement, 43 the agreement is not signed by the broker or a licensee affiliated with the HB 2264--Am. 43 1 broker, the broker or a licensee affiliated with the broker shall furnish a 2 copy of the agreement to the client within a reasonable time after the 3 agreement is signed by the broker or a licensee affiliated with the broker. 4 (g) An agency agreement with a seller or landlord shall include any 5 potential for the seller's agent or landlord's agent to act as a disclosed 6 dual agent. 7 (h) An agency agreement with a buyer or tenant shall include any 8 potential for the buyer's agent or tenant's agent to act as a disclosed dual 9 agent or for an affiliated licensee to act as a designated agent. 10 (i) An agency agreement shall not contain an authorization for the 11 broker to sign or initial any document on behalf of the broker's client in 12 a real estate transaction or authorization for the broker to act as attorney- 13 in-fact for the client. 14 (j) An agency agreement with a seller shall not provide that the brok- 15 er's commission be based on the difference between the gross sales price 16 and the net proceeds to the owner. 17 (k) The broker shall not assign, sell or otherwise transfer a written 18 agency agreement to another broker without the express written consent 19 of all parties to the original agreement. 20 (l) A licensee shall not solicit an agency agreement from a seller or 21 landlord if the licensee knows that the seller or landlord has, with regard 22 to the property, an agency agreement granting an exclusive right to sell 23 or exclusive agency to another broker. 24 (m) A licensee shall not solicit an agency agreement from a buyer or 25 tenant if the licensee knows that the buyer or tenant has a written agency 26 agreement granting exclusive representation to another broker. 27 (n) A licensee shall not induce any party to break any agency agree- 28 ment. 29 (o) A licensee shall not negotiate a sale, exchange or lease of real 30 estate directly with a buyer or tenant if the licensee knows that the buyer 31 or tenant has an agency agreement granting exclusive representation to 32 another broker. 33 (p) A licensee shall not negotiate a sale, exchange or lease of real 34 estate directly with a seller or landlord if the licensee knows that the seller 35 or landlord has an agency agreement granting an exclusive right to sell or 36 exclusive agency to another broker. 37 Sec. 27. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,103, 38 as revived by section 26 of this act, is hereby amended to read as follows: 39 58-30,103. (a) Except when acting as a transaction broker or solely as a 40 seller, buyer, landlord or tenant, a broker shall act only as a statutory 41 agent in any real estate transaction. A licensee may act as a disclosed dual 42 agent but shall not act as an undisclosed dual agent or in a dual capacity 43 of agent and undisclosed principal in any transaction. HB 2264--Am. 44 1 (b) A broker may work with a single party in separate transactions 2 pursuant to different relationships, including, but not limited to, selling 3 one property as a seller's agent and working with that seller in buying 4 another property as a buyer's agent if the broker complies with this act 5 in establishing the relationships for each transaction. A broker who has 6 been working with a seller, landlord, buyer or tenant as a transaction 7 broker may act as an agent for the seller, landlord, buyer or tenant if the 8 broker complies with this act in establishing the agency relationship. 9 (c) Before an agency agreement is signed, the broker or an affiliated 10 licensee shall advise the prospective buyer or seller of alternative agency 11 relationships pursuant to K.S.A. 1996 Supp. 58-30,110. A broker may be 12 engaged as a transaction broker by oral or written agreement with the 13 seller, landlord, buyer or tenant. A broker shall be considered a transac- 14 tion broker unless: 15 (1) An agency relationship between the broker and the party to be 16 represented is established pursuant to this section; or 17 (2) a broker works with a buyer or tenant as a subagent of the seller 18 or landlord by accepting an offer of subagency. 19 (d) (1) Except as provided in subsection (d)(2), an agency agreement 20 with a seller or landlord shall be signed a broker intending to establish 21 an agency relationship with a seller or landlord shall enter into a written 22 agency agreement with the party to be represented prior to the licensee's 23 engaging in any of the activities enumerated in subsection (e) of K.S.A. 24 58-3035 and amendments thereto as an employee of, or on behalf of, the 25 seller or landlord. 26 (2) If the real estate which is to be offered for sale is owned by any 27 agency of the federal government, a broker may, on behalf of the owner, 28 engage in activities enumerated in subsection (e) of K.S.A. 58-3035 and 29 amendments thereto after obtaining verbal authorization from the federal 30 agency for which services are to be performed. 31 (e) An agency agreement with a buyer or tenant shall be signed at or 32 prior to the first showing of a property if the licensee is acting in the 33 capacity of a buyer's agent. If the first showing is an open house and the 34 buyer seeks representation from the licensee holding the open house: 35 (1) The licensee may obtain a written agency agreement with the 36 buyer and act as a disclosed dual agent pursuant to K.S.A. 1996 Supp. 37 58-30,108; or 38 (2) if the property was not listed by the licensee holding the open 39 house, the licensee may obtain a written agency agreement with the buyer 40 and act as a designated agent pursuant to K.S.A. 1996 Supp. 58-30,109. 41 To establish an agency relationship with a buyer or tenant, a broker shall 42 enter into a written agency agreement with the party to be represented 43 no later than the signing of an offer to purchase or lease. HB 2264--Am. 45 1 (f) An agency agreement shall set forth the terms and conditions of 2 the relationship, including a fixed date of expiration, any limitation on the 3 duty of confidentiality and the terms of compensation, and shall specify 4 refer to the duties and obligations pursuant to K.S.A. 1996 Supp. 58- 5 30,106 or 58-30,107, including, but not limited to, any duty of confiden- 6 tiality and the terms of compensation and amendments thereto. The 7 agreement shall be signed by the party to be represented and by the 8 broker or a licensee affiliated with the broker. A copy of the agreement 9 shall be furnished to the client at the time the client signs the agreement. 10 If, at the time the client signs the agreement, the agreement is not signed 11 by the broker or a licensee affiliated with the broker, the broker or a 12 licensee affiliated with the broker shall furnish a copy of the agreement 13 to the client within a reasonable time after the agreement is signed by 14 the broker or a licensee affiliated with the broker. 15 (g) An agency agreement with a seller or landlord shall include any 16 potential: 17 (1) for the seller's agent or landlord's agent to act as a disclosed dual 18 agent transaction broker; 19 (2) for an affiliated licensee to act as a designated agent for the buyer 20 and the designated agent's supervising broker or branch broker, and an 21 affiliated licensee if applicable, to act as a transaction broker; or 22 (3) for the broker to designate an affiliated licensee to act as the des- 23 ignated agent for the seller on the broker's personal listing pursuant to 24 subsection (b)(2) of K.S.A. 58-30,109 and amendments thereto. 25 (h) An agency agreement with a buyer or tenant shall include any 26 potential: 27 (1) For the buyer's agent or tenant's agent to act as a disclosed dual 28 agent transaction broker; or 29 (2) For an affiliated licensee to act as a designated agent for the seller 30 and the designated agent's supervising broker or branch broker, and an 31 affiliated licensee if applicable, to act as a transaction broker. 32 (i) An agency agreement shall not contain an authorization for the 33 broker to sign or initial any document on behalf of the broker's client in 34 a real estate transaction or authorization for the broker to act as attorney- 35 in-fact for the client. 36 (j) An agency agreement with a seller shall not provide that the brok- 37 er's commission be based on the difference between the gross sales price 38 and the net proceeds to the owner. 39 (k) The broker shall not assign, sell or otherwise transfer a written 40 agency agreement to another broker without the express written consent 41 of all parties to the original agreement. 42 (l) A licensee shall not solicit an agency agreement from a seller or 43 landlord if the licensee knows that the seller or landlord has, with regard HB 2264--Am. 46 1 to the property, an agency agreement granting an exclusive right to sell 2 or exclusive agency to another broker. 3 (m) A licensee shall not solicit an agency agreement from a buyer or 4 tenant if the licensee knows that the buyer or tenant has a written agency 5 agreement granting exclusive representation to another broker. 6 (n) A licensee shall not induce any party to break any agency agree- 7 ment. 8 (o) A licensee shall not negotiate a sale, exchange or lease of real 9 estate directly with a buyer or tenant if the licensee knows that the buyer 10 or tenant has an agency agreement granting exclusive representation to 11 another broker. If a licensee knows that a buyer or tenant has an agency 12 agreement granting exclusive representation to another broker, the li- 13 censee shall not contact the buyer or tenant and shall not initiate nego- 14 tiations for the sale, exchange or lease of real estate with the buyer or 15 tenant. The licensee may negotiate the sale, exchange or lease of real estate 16 directly with the buyer or tenant with the informed consent of the buyer 17 or tenant. The informed consent shall be evidenced by a consent agree- 18 ment signed by the buyer or tenant prior to any such direct negotiation. 19 The consent agreement shall acknowledge the buyer or tenant agency 20 agreement and that the buyer or tenant may be liable for compensation 21 under the terms of the agency agreement. The commission, by rules and 22 regulations, shall adopt a consent agreement to be used by licensees pur- 23 suant to this subsection. 24 (p) A licensee shall not negotiate a sale, exchange or lease of real 25 estate directly with a seller or landlord if the licensee knows that the seller 26 or landlord has an agency agreement granting an exclusive right to sell or 27 exclusive agency to another broker. A buyer's or tenant's agent or a sub- 28 agent may present an offer to the seller or landlord if the seller's or lan- 29 dlord's agent is present. 30 Sec. 28. On or after July 1, 1997, K.S.A. 1996 Supp. 58-30,104 is 31 hereby revived to read as follows: 58-30,104. (a) The relationships set 32 forth in K.S.A. 1996 Supp. 58-30,103 shall commence at the time that 33 the client engages the broker, and shall continue until: 34 (1) A transaction is closed according to the agreement of the parties; 35 or 36 (2) if a transaction is not closed according to the agreement of the 37 parties, the earlier of: 38 (A) Any date of expiration agreed upon by the parties in the agency 39 agreement or in any amendments thereto; or 40 (B) any authorized termination of the relationship. 41 (b) Except as otherwise agreed in writing, a broker owes no further 42 duties to the client after termination, expiration, or the closing of a trans- 43 action according to the agreement of the parties, except: HB 2264--Am. 47 1 (1) To account for all moneys and property relating to the engage- 2 ment; and 3 (2) to keep confidential all information received during the course of 4 the engagement which was made confidential by request or instructions 5 from the client, unless: 6 (A) The client permits the disclosure by subsequent word or conduct; 7 (B) such disclosure is required by law; or 8 (C) the information becomes public from a source other than the 9 broker. 10 Sec. 29. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,104, 11 as revived by section 28 of this act, is hereby amended to read as follows: 12 58-30,104. (a) (1) The agency relationships set forth in K.S.A. 1996 Supp. 13 58-30,103, and amendments thereto, shall commence at the time that the 14 client engages the broker, and shall continue until: 15 (1) (A) A transaction is closed according to the agreement of the 16 parties; or 17 (2) (B) if a transaction is not closed according to the agreement of 18 the parties, the earlier of: 19 (A) (i) Any date of expiration agreed upon by the parties in the agency 20 agreement or in any amendments thereto; or 21 (B) (ii) any authorized termination of the relationship. 22 (b) (2) Except as otherwise agreed in writing, a broker owes no fur- 23 ther duties to the client after termination, expiration, or the closing of a 24 transaction according to the agreement of the parties, except: 25 (1) (A) To account for all moneys and property relating to the en- 26 gagement; and 27 (2) (B) to keep confidential all confidential information received dur- 28 ing the course of the engagement which was made confidential by request 29 or instructions from the client, unless: 30 (A) (i) The client permits the disclosure by subsequent word or con- 31 duct; 32 (B) (ii) such disclosure is required by law; or 33 (C) (iii) the information becomes public from a source other than the 34 broker. 35 (b) (1) The relationship between a transaction broker and a seller, 36 landlord, buyer or tenant shall terminate when: 37 (A) A transaction is closed according to the agreement of the parties; 38 or 39 (B) if a transaction is not closed according to the agreement of the 40 parties, the earlier of: 41 (i) Any date of expiration agreed upon by the parties; or 42 (ii) any authorized termination of the relationship. 43 (2) Except as otherwise agreed in writing, a transaction broker owes HB 2264--Am. 48 1 no further duties to any party to the transaction after termination, expi- 2 ration or the closing of a transaction according to the agreement of the 3 parties, except: 4 (A) To account for all moneys and property relating to the engage- 5 ment; and 6 (B) to keep confidential all information received during the course of 7 the engagement which was made confidential by request of any party to 8 the transaction, unless: 9 (i) The party permits the disclosure by subsequent word or conduct; 10 (ii) such disclosure is required by law; or 11 (iii) the information becomes public from a source other than the 12 transaction broker. 13 Sec. 30. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,105 is 14 hereby revived to read as follows: 58-30,105. (a) Compensation is pre- 15 sumed to come from the transaction and shall be determined by agency 16 agreements entered into pursuant to K.S.A. 1996 Supp. 58-30,103. 17 (b) Payment of compensation by itself shall not establish an agency 18 between the party who paid the compensation and the broker or any 19 affiliated licensee. 20 (c) In any transaction, the broker's compensation may be paid by the 21 seller, the landlord, the buyer or the tenant. A broker may be compen- 22 sated by more than one party for services in a transaction if the parties 23 consent in writing to the multiple payments at or before the time of 24 entering into a contract to buy, sell or lease. 25 (d) A broker may: 26 (1) Pay a commission or compensation to any licensee affiliated with 27 the broker for performing services under this act; 28 (2) with the written agreement of the seller or landlord, share a com- 29 mission with another broker who acted as subagent of the seller or land- 30 lord; 31 (3) with the written agreement of the seller or landlord, share a com- 32 mission with a buyer's broker or a tenant's broker; and 33 (4) pay a referral fee to a person who is licensed as a broker under 34 the real estate brokers' and salespersons' license act or under the law of 35 another jurisdiction, provided that written disclosure is made to the client 36 of any financial interest that the broker has in the brokerage firm receiving 37 the referral fee. 38 Sec. 31. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,105, 39 as revived by section 30 of this act, is hereby amended to read as follows: 40 58-30,105. (a) Compensation is presumed to come from the transaction 41 and shall be determined by agency or transaction broker agreements en- 42 tered into pursuant to K.S.A. 1996 Supp. 58-30,103, and amendments 43 thereto. HB 2264--Am. 49 1 (b) Payment of compensation by itself shall not establish an agency 2 between the party who paid the compensation and the broker or any 3 affiliated licensee. 4 (c) In any transaction, the broker's compensation may be paid by the 5 seller, the landlord, the buyer or the tenant. A broker may be compen- 6 sated by more than one party for services in a transaction if the parties 7 consent in writing to the multiple payments at or before the time of 8 entering into a contract to buy, sell or lease. 9 (d) A broker may: 10 (1) Pay a commission or compensation to any licensee affiliated with 11 the broker for performing services under this act; 12 (2) with the written agreement of the seller or, landlord, buyer or 13 tenant share a commission with another broker who acted as subagent of 14 the seller or landlord; a transaction broker, a subagent or an agent of the 15 other party; and 16 (3) with the written agreement of the seller or landlord, share a com- 17 mission with a buyer's broker or a tenant's broker; and 18 (4) pay a referral fee to a person who is licensed as a broker under 19 the real estate brokers' and salespersons' license act or under the law of 20 another jurisdiction, provided that written disclosure is made to the client 21 of any financial interest that the broker has in the brokerage firm receiving 22 the referral fee. 23 Sec. 32. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,106 is 24 hereby revived to read as follows: 58-30,106. (a) A seller's agent or a 25 landlord's agent shall be a statutory agent with the duty and obligation 26 to: 27 (1) Perform the terms of the written agreement made with the client; 28 (2) exercise reasonable skill and care for the client; 29 (3) promote the interests of the client with the utmost good faith, 30 loyalty and fidelity, including: 31 (A) Seeking a price and terms which are acceptable to the client, 32 except that an agency agreement with a seller may provide that the broker 33 shall not be obligated to continue to market the property after an offer 34 has been accepted by the seller; 35 (B) presenting, in a timely manner, all written offers, counteroffers 36 and back-up offers to and from the client when such offer is received 37 prior to the closing of the sale unless the seller instructs the broker in the 38 agency agreement not to submit offers after an offer has been accepted 39 by the seller; 40 (C) disclosing to the client all adverse material facts actually known 41 by the licensee about the buyer or tenant; and 42 (D) advising the client to obtain expert advice as to material matters 43 about which the licensee knows but the specifics of which are beyond the HB 2264--Am. 50 1 expertise of the licensee; 2 (4) account in a timely manner for all money and property received; 3 (5) comply with all requirements of this act and rules and regulations 4 adopted hereunder; and 5 (6) comply with any applicable federal, state and local laws, rules and 6 regulations and ordinances, including fair housing and civil rights statutes 7 and rules and regulations. 8 (b) If pursuant to subsection (a)(3)(D), the licensee advised the client 9 to obtain expert advice as to material matters about which the licensee 10 knows but the specifics of which are beyond the expertise of the licensee, 11 no cause of action for any person shall arise against the licensee pertaining 12 to such material matters. 13 (c) A seller's or landlord's agent shall not disclose any confidential 14 information about the client unless disclosure is required by statute or 15 rule and regulation or failure to disclose the information would constitute 16 fraudulent misrepresentation. No cause of action for any person shall arise 17 against a licensee acting as a seller's or landlord's agent for making any 18 required or permitted disclosure. 19 (d) (1) A seller's or landlord's agent owes no duty or obligation to a 20 customer, except that a licensee shall disclose to any customer all adverse 21 material facts actually known by the licensee, including but not limited 22 to: 23 (A) Any environmental hazards affecting the property which are re- 24 quired by law to be disclosed; 25 (B) the physical condition of the property; 26 (C) any material defects in the property; 27 (D) any material defects in the title to the property; or 28 (E) any material limitation on the client's ability to perform under 29 the terms of the contract. 30 (2) A seller's or landlord's agent owes no duty to conduct an inde- 31 pendent inspection of the property for the benefit of the customer and 32 owes no duty to independently verify the accuracy or completeness of 33 any statement made by the client or any qualified third party. 34 (3) Except as provided in subsection (d)(4), a seller's or landlord's 35 agent is not required to disclose to a client or customer information re- 36 lating to the physical condition of the property if a written report regard- 37 ing the physical condition of the property has been prepared by a qualified 38 third party and provided to the client or customer. 39 (4) A licensee shall disclose to the client or customer any facts known 40 by the licensee that contradict any information included in a written re- 41 port described in subsection (d)(3). 42 (5) In performing an investigation or inspection and in making a dis- 43 closure in connection with a real estate transaction, a licensee shall ex- HB 2264--Am. 51 1 ercise the degree of care expected to be exercised by a reasonably prudent 2 person who has the knowledge, skills and training required for licensure 3 as a broker or salesperson. 4 For purpose of this subsection, ``qualified third party'' means a federal, 5 state or local governmental agency or any person whom the broker, af- 6 filiated licensee or a party to the real estate transaction reasonably be- 7 lieves has the expertise necessary to meet the industry standards of prac- 8 tice for the type of inspection or investigation that has been conducted 9 by the third party in order to prepare the written report. 10 (e) A seller's or landlord's agent may show alternative properties not 11 owned by the client to prospective buyers or tenants and may list com- 12 peting properties for sale or lease without breaching any duty or obliga- 13 tion to the client. 14 (f) A seller or landlord may agree in writing with a seller's or lan- 15 dlord's agent that the broker may offer subagency and pay compensation 16 to other brokers. 17 (g) A seller or landlord may agree in writing with a seller's or lan- 18 dlord's agent that the broker may offer to cooperate with a buyer's or 19 tenant's agent or to cooperate with and pay compensation to a buyer's or 20 tenant's agent. 21 (h) If the seller or landlord has authorized the broker to offer coop- 22 eration with other licensees pursuant to subsection (f) or (g), the broker 23 shall not refuse permission to another licensee to show, or to present an 24 offer to purchase, a listed property unless specifically instructed by the 25 seller in writing. The broker shall provide a copy of the written instruc- 26 tions to another licensee upon request. 27 (i) A seller's or landlord's agent shall not be liable for punitive or 28 exemplary damages for the licensee's failure to perform any of the duties 29 set forth in this section, unless such failure is shown by clear and con- 30 vincing evidence that the licensee acted toward the plaintiff with willful 31 conduct, wanton conduct, fraud or malice. 32 Sec. 33. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,106, 33 as revived by section 32 of this act, is hereby amended to read as follows: 34 58-30,106. (a) A seller's agent or a landlord's agent shall be a statutory 35 agent with the duty and obligation to: 36 (1) Perform the terms of the written agreement made with the client; 37 (2) exercise reasonable skill and care for the client; 38 (3) promote the interests of the client with the utmost good faith, 39 loyalty and fidelity, including: 40 (A) Seeking a price and terms which are acceptable to the client, 41 except that an agency agreement with a seller may provide that the broker 42 shall not be obligated to continue to market the property after an offer 43 has been accepted by the seller; HB 2264--Am. 52 1 (B) presenting, in a timely manner, all written offers, counteroffers 2 and back-up offers to and from the client when such offer is received 3 prior to the closing of the sale unless the seller instructs the broker in the 4 agency agreement not to submit offers after an offer has been accepted 5 by the seller, even when the property is subject to a contract sale when 6 such offer is received prior to the closing of the sale unless the 7 seller instructs the broker in the agency agreement not to submit 8 offers after an offer has been accepted by the seller; 9 (C) (B) disclosing to the client all adverse material facts actually 10 known by the licensee about the buyer or tenant; and 11 (D) (C) advising the client to obtain expert advice as to material mat- 12 ters about which the licensee knows but the specifics of which are beyond 13 the expertise of the licensee; 14 (4) (3) account in a timely manner for all money and property re- 15 ceived; 16 (5) (4) comply with all requirements of this act and rules and regu- 17 lations adopted hereunder; and 18 (6) (5) comply with any applicable federal, state and local laws, rules 19 and regulations and ordinances, including fair housing and civil rights 20 statutes and rules and regulations. 21 (b) If pursuant to subsection (a)(3)(D) (a)(2)(C), the licensee advised 22 the client to obtain expert advice as to material matters about which the 23 licensee knows but the specifics of which are beyond the expertise of the 24 licensee, no cause of action for any person shall arise against the licensee 25 pertaining to such material matters. 26 (c) A seller's or landlord's agent shall not disclose any confidential 27 information about the client unless disclosure is required by statute or 28 rule and regulation or failure to disclose the information would constitute 29 fraudulent misrepresentation. No cause of action for any person shall arise 30 against a licensee acting as a seller's or landlord's agent for making any 31 required or permitted disclosure. 32 (d) (1) A seller's or landlord's agent owes no duty or obligation to a 33 customer, except that a licensee shall disclose to any customer all adverse 34 material facts actually known by the licensee, including but not limited 35 to: 36 (A) Any environmental hazards affecting the property which are re- 37 quired by law to be disclosed; 38 (B) the physical condition of the property; 39 (C) any material defects in the property; 40 (D) any material defects in the title to the property; or 41 (E) any material limitation on the client's ability to perform under 42 the terms of the contract. 43 (2) A seller's or landlord's agent owes no duty to conduct an inde- HB 2264--Am. 53 1 pendent inspection of the property for the benefit of the customer and 2 owes no duty to independently verify the accuracy or completeness of 3 any statement made by the client or any qualified third party. 4 (3) Except as provided in subsection (d)(4), a seller's or landlord's 5 agent is not required to disclose to a client or customer information re- 6 lating to the physical condition of the property if a written report regard- 7 ing the physical condition of the property has been prepared by a qualified 8 third party and provided to the client or customer. 9 (4) A licensee seller's or landlord's agent shall disclose to the client 10 or customer any facts actually known by the licensee that were omitted 11 from or contradict any information included in a written report described 12 in subsection (d)(3). 13 (5) In performing an investigation or inspection and in making a dis- 14 closure in connection with a real estate transaction, a licensee shall ex- 15 ercise the degree of care expected to be exercised by a reasonably prudent 16 person who has the knowledge, skills and training required for licensure 17 as a broker or salesperson. 18 For purpose of this subsection, ``qualified third party'' means a federal, 19 state or local governmental agency or any person whom the broker, af- 20 filiated licensee or a party to the real estate transaction reasonably be- 21 lieves has the expertise necessary to meet the industry standards of prac- 22 tice for the type of inspection or investigation that has been conducted 23 by the third party in order to prepare the written report. 24 (e) A seller's or landlord's agent may provide assistance to the cus- 25 tomer by performing ministerial acts. Performing ministerial acts for the 26 customer shall not be construed as violating the brokerage firm's agency 27 with the seller or landlord and shall not be construed as forming an agency 28 with the customer. 29 (f) A seller's or landlord's agent may show alternative properties not 30 owned by the client to prospective buyers or tenants and may list com- 31 peting properties for sale or lease without breaching any duty or obliga- 32 tion to the client. 33 (f) (g) A seller or landlord may agree in writing with a seller's or 34 landlord's agent that the broker may offer subagency and pay compen- 35 sation to other brokers. 36 (g) (h) A seller or landlord may agree in writing with a seller's or 37 landlord's agent that the broker may offer to cooperate with a buyer's or 38 tenant's agent or to cooperate with and pay compensation to a buyer's or 39 tenant's agent. 40 (i) A seller or landlord may agree in writing with a seller's or lan- 41 dlord's agent that the broker may offer to cooperate with a transaction 42 broker or to cooperate with and pay compensation to a transaction broker. 43 (h) (j) If the seller or landlord has authorized the broker to offer HB 2264--Am. 54 1 cooperation with other licensees pursuant to subsection (f) or (g), (h) or 2 (i) the broker shall not refuse permission to another licensee to show, or 3 to present an offer to purchase, a listed property unless a listed property 4 or refuse to receive and transmit to the seller or landlord a written offer 5 or a listed property from another licensee specifically instructed by the 6 seller in writing. The broker shall provide a copy of the written instruc- 7 tions to another licensee upon request. 8 (i) (k) A seller's or landlord's agent shall not be liable for punitive or 9 exemplary damages for the licensee's failure to perform any of the duties 10 set forth in this section, unless such failure is shown by clear and con- 11 vincing evidence that the licensee acted toward the plaintiff with willful 12 conduct, wanton conduct, fraud or malice. 13 Sec. 34. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,107 is 14 hereby revived to read as follows: 58-30,107. (a) A buyer's or a tenant's 15 agent shall be a statutory agent with the following duty and obligation to: 16 (1) Perform the terms of the written agreement made with the client; 17 (2) exercise reasonable skill and care for the client; 18 (3) promote the interests of the client with the utmost good faith, 19 loyalty and fidelity, including: 20 (A) Seeking a price and terms which are acceptable to the client, 21 except that an agency agreement may provide that the licensee shall not 22 be obligated to seek other properties after the client enters into a pur- 23 chase contract; 24 (B) presenting, in a timely manner, all written offers, counteroffers 25 and back-up offers to and from the client when such offer is received 26 prior to the closing of the sale unless the buyer instructs the broker in 27 the agency agreement not to submit offers after the client enters into a 28 purchase contract; 29 (C) disclosing to the client all adverse material facts actually known 30 by the licensee; and 31 (D) advising the client to obtain expert advice as to material matters 32 about which the licensee knows but the specifics of which are beyond the 33 expertise of the licensee; 34 (4) account in a timely manner for all money and property received; 35 (5) comply with all requirements of this act and rules and regulations 36 adopted hereunder; and 37 (6) comply with any applicable federal, state and local laws, rules and 38 regulations and ordinances, including fair housing and civil rights statutes 39 or rules and regulations. 40 (b) If pursuant to subsection (a)(3)(D), the licensee advised the client 41 to obtain expert advice as to material matters about which the licensee 42 knows but the specifics of which are beyond the expertise of the licensee, 43 no cause of action for any person shall arise against the licensee pertaining HB 2264--Am. 55 1 to such material matters. 2 (c) A buyer's or tenant's agent shall not disclose any confidential in- 3 formation about the client unless disclosure is required by statute or rule 4 and regulation or failure to disclose the information would constitute 5 fraudulent misrepresentation. No cause of action for any person shall arise 6 against a licensee acting as a buyer's or tenant's agent for making any 7 required or permitted disclosure. 8 (d) (1) A buyer's or tenant's agent owes no duty or obligation to a 9 customer, except that the licensee shall disclose to any customer all ad- 10 verse material facts actually known by the licensee, including but not 11 limited to material facts concerning the client's financial ability to perform 12 the terms of the transaction. 13 (2) A buyer's or tenant's agent owes no duty to conduct an inde- 14 pendent investigation of the client's financial condition for the benefit of 15 the customer and owes no duty to independently verify the accuracy or 16 completeness of statements made by the client or any qualified third 17 party. 18 (3) Except as provided in subsection (d)(4), a buyer's or tenant's agent 19 is not required to disclose to a client or customer information relating to 20 the physical condition of the property if a written report regarding the 21 physical condition of the property has been prepared by a qualified third 22 party and provided to the client or customer. 23 (4) A licensee shall disclose to the client or customer any facts known 24 by the licensee that contradict any information included in a written re- 25 port described in subsection (d)(3). 26 (5) In performing an investigation or inspection and in making a dis- 27 closure in connection with a real estate transaction, a licensee shall ex- 28 ercise the degree of care expected to be exercised by a reasonably prudent 29 person who has the knowledge, skills and training required for licensure 30 as a broker or salesperson. 31 For purpose of this subsection, ``qualified third party'' means a federal, 32 state or local governmental agency or any person whom the broker, the 33 affiliated licensee or a party to the real estate transaction reasonably be- 34 lieves has the expertise necessary to meet the industry standards of prac- 35 tice for the type of inspection or investigation that has been conducted 36 by the third party in order to prepare the written report. 37 (e) A buyer's or tenant's agent may show properties in which the 38 client is interested to other prospective buyers or tenants without breach- 39 ing any duty or obligation to the client. This subsection is intended to 40 allow a buyer's or tenant's agent to show competing buyers or tenants the 41 same property and to assist competing buyers or tenants in attempting to 42 purchase or lease a particular property. 43 (f) Except as provided in subsection (e) of K.S.A. 1996 Supp. 58- HB 2264--Am. 56 1 30,103, a licensee may not act as a buyer's agent on any property shown 2 to the buyer while the licensee was acting as an agent or subagent of the 3 seller without the written agreement of the seller. If the licensee has 4 knowledge that another licensee affiliated with the broker showed the 5 property to the buyer while acting as an agent or subagent of the seller, 6 the licensee shall obtain the written agreement of the seller before acting 7 as the buyer's agent. 8 (g) A buyer or tenant may agree in writing with a buyer's or tenant's 9 agent that the agent may receive compensation from a seller's or lan- 10 dlord's agent. 11 (h) A buyer's or tenant's agent shall not be liable for punitive or ex- 12 emplary damages for the licensee's failure to perform any of the duties 13 set forth in this section, unless such failure is shown by clear and con- 14 vincing evidence that the licensee acted toward the plaintiff with willful 15 conduct, wanton conduct, fraud or malice. 16 Sec. 35. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,107, 17 as revived by section 34 of this act, is hereby amended to read as follows: 18 58-30,107. (a) A buyer's or a tenant's agent shall be a statutory agent with 19 the following duty and obligation to: 20 (1) Perform the terms of the written agreement made with the client; 21 (2) exercise reasonable skill and care for the client; 22 (3) promote the interests of the client with the utmost good faith, 23 loyalty and fidelity, including: 24 (A) Seeking a price and terms which are acceptable to the client, 25 except that an agency agreement may provide that the licensee shall not 26 be obligated to seek other properties after the client enters into a pur- 27 chase contract; 28 (B) Presenting, in a timely manner, all written offers, counteroffers 29 and back-up offers to and from the client when such offer is received 30 prior to the closing of the sale unless the buyer instructs the broker in 31 the agency agreement not to submit offers after the client enters into a 32 purchase contract when such offer is received prior to the closing of 33 the sale unless the buyer instructs the broker in the agency agree- 34 ment not to submit offers after the client enters into a purchase 35 contract; 36 (C) (B) disclosing to the client all adverse material facts actually 37 known by the licensee; and 38 (D) (C) advising the client to obtain expert advice as to material mat- 39 ters about which the licensee knows but the specifics of which are beyond 40 the expertise of the licensee; 41 (4) (3) account in a timely manner for all money and property re- 42 ceived; 43 (5) (4) comply with all requirements of this act and rules and regu- HB 2264--Am. 57 1 lations adopted hereunder; and 2 (6) (5) comply with any applicable federal, state and local laws, rules 3 and regulations and ordinances, including fair housing and civil rights 4 statutes or rules and regulations. 5 (b) If pursuant to subsection (a)(3)(D) (a)(2)(C), the licensee advised 6 the client to obtain expert advice as to material matters about which the 7 licensee knows but the specifics of which are beyond the expertise of the 8 licensee, no cause of action for any person shall arise against the licensee 9 pertaining to such material matters. 10 (c) A buyer's or tenant's agent shall not disclose any confidential in- 11 formation about the client unless disclosure is required by statute or rule 12 and regulation or failure to disclose the information would constitute 13 fraudulent misrepresentation. No cause of action for any person shall arise 14 against a licensee acting as a buyer's or tenant's agent for making any 15 required or permitted disclosure. 16 (d) (1) A buyer's or tenant's agent owes no duty or obligation to a 17 customer, except that the licensee shall disclose to any customer all ad- 18 verse material facts actually known by the licensee, including but not 19 limited to material facts concerning the client's financial ability to perform 20 the terms of the transaction. 21 (2) A buyer's or tenant's agent owes no duty to conduct an inde- 22 pendent investigation of the client's financial condition for the benefit of 23 the customer and owes no duty to independently verify the accuracy or 24 completeness of statements made by the client or any qualified third 25 party. 26 (3) Except as provided in subsection (d)(4), a buyer's or tenant's agent 27 is not required to disclose to a client or customer information relating to 28 the physical condition of the property if a written report regarding the 29 physical condition of the property has been prepared by a qualified third 30 party and provided to the client or customer. 31 (4) A licensee buyer's or tenant's agent shall disclose to the client or 32 customer any facts actually known by the licensee that were omitted from 33 or contradict any information included in a written report described in 34 subsection (d)(3). 35 (5) In performing an investigation or inspection and in making a dis- 36 closure in connection with a real estate transaction, a licensee shall ex- 37 ercise the degree of care expected to be exercised by a reasonably prudent 38 person who has the knowledge, skills and training required for licensure 39 as a broker or salesperson. 40 For purpose of this subsection, ``qualified third party'' means a federal, 41 state or local governmental agency or any person whom the broker, the 42 affiliated licensee or a party to the real estate transaction reasonably be- 43 lieves has the expertise necessary to meet the industry standards of prac- HB 2264--Am. 58 1 tice for the type of inspection or investigation that has been conducted 2 by the third party in order to prepare the written report. 3 (e) A buyer's or tenant's agent may provide assistance to the seller or 4 landlord by performing ministerial acts. Performing ministerial acts for 5 the seller or landlord shall not be construed as violating the brokerage 6 firm's agency with the buyer or tenant and shall not be construed as 7 forming an agency with the seller or landlord. 8 (f) A buyer's or tenant's agent may show properties in which the client 9 is interested to other prospective buyers or tenants without breaching any 10 duty or obligation to the client. This subsection is intended to allow a 11 buyer's or tenant's agent to show competing buyers or tenants the same 12 property and to assist competing buyers or tenants in attempting to pur- 13 chase or lease a particular property. 14 (f) Except as provided in subsection (e) of K.S.A. 1996 Supp. 58- 15 30,103, a licensee may not act as a buyer's agent on any property shown 16 to the buyer while the licensee was acting as an agent or subagent of the 17 seller without the written agreement of the seller. If the licensee has 18 knowledge that another licensee affiliated with the broker showed the 19 property to the buyer while acting as an agent or subagent of the seller, 20 the licensee shall obtain the written agreement of the seller before acting 21 as the buyer's agent. 22 (g) A buyer or tenant may agree in writing with a buyer's or tenant's 23 agent that the agent may receive compensation from a seller's or lan- 24 dlord's agent or from a transaction broker. 25 (h) A buyer's or tenant's agent shall not be liable for punitive or ex- 26 emplary damages for the licensee's failure to perform any of the duties 27 set forth in this section, unless such failure is shown by clear and con- 28 vincing evidence that the licensee acted toward the plaintiff with willful 29 conduct, wanton conduct, fraud or malice. 30 Sec. 36. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,108 is 31 hereby revived to read as follows: 58-30,108. (a) (1) A licensee may act 32 as a dual agent only with the informed consent of all parties to the trans- 33 action. The informed consent shall be evidenced by a dual agency consent 34 agreement which shall include, at a minimum, the duties and obligations 35 included in this section. 36 (2) If, pursuant to subsections (g) and (h) of K.S.A. 1996 Supp. 58- 37 30,103, the agency agreements include a potential for the seller's or lan- 38 dlord's agent and the buyer's or tenant's agent to act as a disclosed dual 39 agent, the dual agency consent agreement shall be signed by the buyer 40 or the tenant no later than the first showing of the property and by the 41 seller or the landlord no later than the presentation of the offer to pur- 42 chase or lease. If the agency agreements did not include a potential for 43 the seller's or landlord's agent and the buyer's or tenant's agent to act as HB 2264--Am. 59 1 a disclosed dual agent, the dual agency consent agreement shall be signed 2 by the buyer and seller or the tenant and landlord prior to the first show- 3 ing of the property. 4 (b) A disclosed dual agent shall be a statutory agent for both the seller 5 and buyer or the landlord and tenant. 6 (c) A disclosed dual agent shall not represent the interest of either 7 the buyer or the seller or the tenant or the landlord to the detriment of 8 the other. The buyer and seller or the tenant and landlord shall have the 9 responsibility of determining the price they will pay or accept, and they 10 may rely on information provided by the disclosed dual agent. The broker 11 shall cease to serve as either seller's or buyer's or landlord's or tenant's 12 sole and exclusive agent. 13 (d) The following information shall not be disclosed by a disclosed 14 dual agent without the informed consent of the client to whom the in- 15 formation pertains: 16 (A) That a buyer or tenant is willing to pay more than the purchase 17 price or lease rate offered for the property; 18 (B) that a seller or landlord is willing to accept less than the asking 19 price or lease rate for the property; 20 (C) what the motivating factors are for any client's buying, selling or 21 leasing the property; or 22 (D) that a client will agree to financing terms other than those of- 23 fered. 24 (e) A disclosed dual agent shall not disclose to one client any confi- 25 dential information or personal confidences about the other client which 26 might place one party at an advantage over the other party unless the 27 disclosure is required by statute or rule and regulation or failure to dis- 28 close the information would constitute fraudulent misrepresentation. 29 (f) No cause of action for any person shall arise against a disclosed 30 dual agent for making any required or permitted disclosure. 31 (g) By making any required or permitted disclosure, a disclosed dual 32 agent does not terminate the dual agency relationship. 33 (h) In a dual agency relationship, there shall be no imputation of 34 knowledge or information between any client and the disclosed dual agent 35 or among licensees within the brokerage firm engaged as a dual agent. 36 (i) In any transaction, a broker may without liability withdraw from 37 representing a client if either client does not consent to a disclosed dual 38 agency. Such withdrawal shall not prejudice the ability of the broker to 39 continue to represent the other client in the transaction, nor limit the 40 broker from representing the client in other transactions not involving a 41 dual agency. Such withdrawal shall not limit the ability of the broker to 42 receive a referral fee for referring a client to a broker of a different bro- 43 kerage firm. HB 2264--Am. 60 1 Sec. 37. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,109 is 2 hereby revived to read as follows: 58-30,109. (a) A broker may personally, 3 or through the broker's duly authorized licensed representative, specifi- 4 cally designate, in a written buyer agency agreement obtained pursuant 5 to K.S.A. 1996 Supp. 58-30,103, an affiliated licensee who will be acting 6 as legal agent of the buyer client to the exclusion of all other affiliated 7 licensees. After verbal notice has been given to the buyer client, another 8 affiliated licensee may be temporarily appointed as a designated agent. 9 (b) With the exception of a property listed by the designated agent, 10 a designated agent shall not act as an agent of any owner of property listed 11 with the broker when representing a specific buyer client. 12 (c) If a designated agent also acts as agent of the seller of property 13 listed by the designated agent, the agent and the broker shall be disclosed 14 dual agents pursuant to K.S.A. 1996 Supp. 58-30,108. 15 (d) If the broker performs any duty or obligation set forth in subsec- 16 tion (a)(3) of K.S.A. 1996 Supp. 58-30,106, the broker and the designated 17 agent or agents shall be disclosed dual agents pursuant to K.S.A. 1996 18 Supp. 58-30,108. 19 (e) The broker shall not be considered to be acting for more than 20 one party in the transaction provided that the broker is not a disclosed 21 dual agent pursuant to subsection (c) or (d). 22 (f) Unless acting as a disclosed dual agent pursuant to subsection (c) 23 or (d), a designated agent shall not be considered a dual agent nor shall 24 the licensee be liable for acting as an undisclosed dual agent merely by 25 performing licensed services in accordance with the provisions of this 26 section. 27 Sec. 38. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,109, 28 as revived by section 37 of this act, is hereby amended to read as follows: 29 58-30,109. (a) In the absence of designated agents appointed pursuant to 30 subsection (b), a brokerage firm may act as a transaction broker pursuant 31 to section 1, and amendments thereto, on an in-house transaction with 32 the informed consent of the seller client and the buyer client. The informed 33 consent shall be evidenced by a transaction broker addendum to the 34 agency agreements and shall be signed by the buyer prior to writing the 35 offer and by the seller prior to signing the contract. 36 (b) (1) A broker may personally, or through the broker's duly au- 37 thorized licensed representative, specifically designate, in a written buyer 38 agency agreement obtained pursuant to K.S.A. 1996 Supp. 58-30,103, an 39 affiliated licensee and amendments thereto, one or more affiliated licens- 40 ees who will be acting as legal agent of the buyer client or seller client to 41 the exclusion of all other affiliated licensees. After verbal notice has been 42 given to the buyer client, another affiliated licensee may be temporarily 43 appointed as a designated agent. HB 2264--Am. 61 1 (b) With the exception of a property listed by the designated agent, 2 a designated agent shall not act as an agent of any owner of property listed 3 with the broker when representing a specific buyer client. 4 (c) If a designated agent also acts as agent of the seller of property 5 listed by the designated agent, the agent and the broker shall be disclosed 6 dual agents pursuant to K.S.A. 1996 Supp. 58-30,108. 7 (d) If the broker performs any duty or obligation set forth in subsec- 8 tion (a)(3) of K.S.A. 1996 Supp. 58-30,106, the broker and the designated 9 agent or agents shall be disclosed dual agents pursuant to K.S.A. 1996 10 Supp. 58-30,108. 11 (e) The broker shall not be considered to be acting for more than 12 one party in the transaction provided that the broker is not a disclosed 13 dual agent pursuant to subsection (c) or (d). 14 (f) Unless acting as a disclosed dual agent pursuant to subsection (c) 15 or (d), a designated agent shall not be considered a dual agent nor shall 16 the licensee be liable for acting as an undisclosed dual agent merely by 17 performing licensed services in accordance with the provisions of this 18 section. 19 (2) If a buyer client of a designated agent wants to see a property 20 which was personally listed by the broker, the broker, with the written 21 consent of the seller, may specifically designate an affiliated licensee who 22 will act as legal agent of the seller client to the exclusion of all other 23 affiliated licensees. The written consent of the seller shall contain the name 24 of the prospective buyer and shall acknowledge that the broker shall act 25 as a transaction broker regarding any transaction with the buyer. The 26 written consent of the seller shall be signed prior to presentation of any 27 offer. 28 (3) A designated agent of a seller client shall have the duties and 29 obligations set forth in K.S.A. 58-30,106, and amendments thereto. A des- 30 ignated agent of a buyer client shall have the duties and obligations set 31 forth in K.S.A. 58-30,107, and amendments thereto. 32 (4) In any transaction involving a designated agent, the supervising 33 broker of the designated agent shall act as a transaction broker pursuant 34 to section 1, and amendments thereto, unless both buyer and seller are 35 represented by designated agents and the designated agents are super- 36 vised by the same branch broker. In that case, the branch broker shall 37 act as a transaction broker pursuant to section 1, and amendments 38 thereto. The supervising broker, or branch broker if applicable, may ap- 39 point an affiliated licensee to act in the transaction as a transaction broker 40 pursuant to section 1, and amendments thereto. 41 (5) A designated agent may disclose to the designated agent's super- 42 vising broker, or branch broker if applicable, and to an affiliated licensee 43 appointed as a transaction broker pursuant to paragraph (4), confidential HB 2264--Am. 62 1 information of a client for the purpose of seeking advice or assistance for 2 the benefit of the client in regard to a transaction. 3 (6) If a buyer client of a designated agent wants to see a property 4 owned by a seller client of the designated agent, the designated agent may 5 act as a transaction broker pursuant to section 1, and amendments 6 thereto, with the informed consent of the seller client and buyer client. 7 The informed consent shall be evidenced by a transaction broker adden- 8 dum to the agency agreements and shall be signed by the buyer prior to 9 writing the offer and by the seller prior to signing the contract. 10 (c) The commission, by rules and regulations, shall adopt a transac- 11 tion broker addendum form to be used by licensees pursuant to this sec- 12 tion. 13 Sec. 39. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,110 is 14 hereby revived to read as follows: 58-30,110. (a) (1) The commission shall 15 adopt a rule and regulation prescribing the language which shall be in- 16 cluded in a form entitled ``Disclosure of alternative agency relationships''. 17 (2) At the discretion of the broker, the disclosure of alternative 18 agency relationships form may be either a separate document or may be 19 contained in the agency agreement with the client. 20 (3) Except as provided in subsection (a)(4), a licensee shall furnish a 21 prospective buyer or seller with a copy of the disclosure of alternative 22 agency relationships form at the first occurrence of either of the following 23 events regarding real estate transactions: 24 (A) A face-to-face meeting with the prospective buyer or seller; or 25 (B) a written communication from the licensee. 26 The licensee shall note the furnishing of a copy of the disclosure on 27 the contract. 28 (4) A licensee is not required to provide a copy of the form to a 29 prospective buyer or seller in the following instances: 30 (A) The licensee is acting solely as a principal and not as an agent for 31 another; 32 (B) the written communication from the licensee is a solicitation of 33 business; 34 (C) the face-to-face meeting occurs at an open house and there is no 35 substantive discussion regarding a transaction; or 36 (D) the face-to-face meeting is a mere solicitation of business and 37 there is no substantive discussion regarding a transaction. 38 (b) (1) Except for instances when a licensee is providing information 39 through an advertisement or other form of public notice of the licensee's 40 representation of a client, a licensee representing a client in a proposed 41 real estate transaction shall disclose the representation at the time of 42 every contact with another licensee representing the other party. The 43 disclosure may be made orally or in writing. HB 2264--Am. 63 1 (2) Each time a licensee is contacted by another licensee who re- 2 quests permission to show property to a prospective buyer, the licensee 3 shall inquire whether or not the licensee represents the buyer. 4 (c) The disclosure of the agency relationship between all licensees 5 involved and the seller and buyer shall be included in any contract for 6 sale and in any lot reservation agreement. 7 Sec. 40. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,110, 8 as revived by section 39 of this act, is hereby amended to read as follows: 9 58-30,110. (a) (1) The commission shall adopt a rule and regulation pre- 10 scribing the language which shall be included in a form entitled ``Disclo- 11 sure of alternative agency relationships'' describes a seller's agent, a buy- 12 er's agent and a transaction broker for inclusion in a brochure entitled 13 ``real estate brokerage relationships''. 14 (2) At the discretion of the broker, the disclosure of alternative 15 agency relationships form may be either a separate document or may be 16 contained in the agency agreement with the client. 17 (3) Except as provided in subsection (a)(4) (a)(3), a licensee shall 18 furnish a prospective buyer or seller with a copy of the disclosure of 19 alternative agency relationships form at the first occurrence of either of 20 the following events regarding real estate transactions: 21 (A) A face-to-face meeting with the prospective buyer or seller; or 22 (B) a written communication from the licensee. 23 The licensee shall note the furnishing of a copy of the disclosure on 24 the contract the brochure at the first practical opportunity. 25 (4) (3) A licensee is not required to provide a copy of the form bro- 26 chure to a prospective buyer or seller in the following instances: 27 (A) The licensee is acting solely as a principal and not as an agent for 28 another; 29 (B) the written communication from the licensee is a solicitation of 30 business; 31 (C) the face-to-face meeting occurs at an open house and there is no 32 substantive discussion regarding a transaction; or transaction is regarding 33 the sale or lease of commercial property or the sale of residential property 34 of more than four units; 35 (D) the face-to-face meeting is a mere solicitation of business and 36 there is no substantive discussion regarding a transaction. transaction is 37 regarding the sale of property by public auction; 38 (E) the licensee is only performing ministerial acts; or 39 (F) the customer or client has already received the brochure from the 40 licensee's brokerage firm. 41 (4) Acknowledgment of receipt of the brochure by the seller and buyer 42 shall be included in any contract for sale. 43 (b) (1) Except for instances when a licensee is providing information HB 2264--Am. 64 1 through an advertisement or other form of public notice of the licensee's 2 representation of a client, a licensee representing a client in a proposed 3 real estate transaction shall disclose the representation at the time of 4 every the initial contact with another licensee representing the other 5 party. The disclosure may be made orally or in writing. 6 (2) Each time a licensee is contacted by another licensee who re- 7 quests permission to show property to a prospective buyer, the licensee 8 shall inquire whether or not the licensee represents the buyer. 9 (c) The disclosure of the agency brokerage relationship between all 10 licensees involved and the seller and buyer shall be included in any con- 11 tract for sale and in any lot reservation agreement. 12 Sec. 41. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,111 is 13 hereby revived to read as follows: 58-30,111. (a) A client shall not be 14 liable for a misrepresentation of the client's statutory agent arising out of 15 the agency agreement unless the client knew of the misrepresentation. 16 (b) A statutory agent shall not be liable for a misrepresentation of the 17 agent's client arising out of the agency agreement unless the licensee 18 knew of the misrepresentation. 19 (c) A statutory agent shall not be liable for an innocent misrepresen- 20 tation in information provided to the seller or landlord or to the buyer or 21 tenant if the licensee does not have personal knowledge of the error, 22 inaccuracy or omission that is the basis for the misrepresentation. 23 Sec. 42. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,111, 24 as revived by section 41 of this act, is hereby amended to read as follows: 25 58-30,111. (a) A client or customer shall not be liable for a misrepresen- 26 tation of or omission by the client's statutory agent or the transaction 27 broker arising out of the agency or transaction broker agreement unless 28 the client or customer knew of the misrepresentation or omission. 29 (b) A statutory agent or transmission transaction broker shall not be 30 liable for a misrepresentation of or omission by the agent's client or the 31 transaction broker's customer arising out of the agency or transaction 32 broker agreement unless the licensee knew of the misrepresentation or 33 omission. 34 (c) A statutory agent or transaction broker shall not be liable for an 35 innocent or negligent misrepresentation in information provided to the 36 seller or landlord or to the buyer or tenant if the licensee does not have 37 personal knowledge of the error, inaccuracy or omission that is the basis 38 for the claim of misrepresentation. 39 Sec. 43. On and after July 1, 1997, K.S.A. 1996 Supp. 58-30,112 is 40 hereby revived to read as follows: 58-30,112. The commission shall pro- 41 vide suggested forms of agency agreements and, by rules and regulations, 42 provide such other prohibitions, limitations and conditions relating 43 thereto as the commission may prescribe. HB 2264--Am. 65 1 Sec. 44. On and after October 1, 1997, K.S.A. 1996 Supp. 58-30,112, 2 as revived by section 43 of this act, is hereby amended to read as follows: 3 58-30,112. The commission shall provide suggested sample forms of 4 agency agreements and, by rules and regulations, provide such other pro- 5 hibitions, limitations and conditions relating thereto as the commission 6 may prescribe. 7 Sec. 45. On and after July 1, 1997, K.S.A. 1996 Supp. 74-4202 is 8 hereby revived to read as follows: 74-4202. (a) Within 30 days after the 9 appointment of the members to be regularly appointed within any year, 10 the commission shall meet in the city of Topeka for the purpose of or- 11 ganizing by selecting from its membership a chairperson and such other 12 officers as the commission may deem necessary and appropriate. A ma- 13 jority of the members of the commission shall constitute a quorum for 14 the exercise of the powers or authority conferred upon it. 15 (b) The commission shall receive applications for, and issue licenses 16 to, brokers and salespersons, as provided in this act and shall administer 17 the provisions of this act and the brokerage relationships in real estate 18 transactions act, as such act governs the sale or lease of real estate that is 19 one to four residential units. The commission may do all things necessary 20 and convenient for carrying into effect the provisions of the acts and may 21 adopt rules and regulations not inconsistent with the acts. For the purpose 22 of the acts, the commission shall make all necessary investigations, and 23 every licensee shall furnish to the commission such evidence as the li- 24 censee may have as to any violation the acts or any rules and regulations 25 adopted under the acts. The commission may enforce any order by an 26 action in the district court of the county where the alleged violator resides 27 or where the violation allegedly occurred. 28 (c) Each member of the commission shall be paid compensation, sub- 29 sistence allowances, mileage and other expenses as provided in K.S.A. 75- 30 3223 and amendments thereto. 31 (d) The commission shall hold meetings and hearings in the city of 32 Topeka or at such places as it shall determine at such times as it may 33 designate and on request of two or more of its members. 34 (e) The commission shall maintain an office in the city of Topeka, 35 and all files, records and property of the commission shall at all times be 36 and remain therein. 37 (f) The commission shall adopt a seal by which it shall attest its pro- 38 ceedings. Copies of all records and papers required by law or the com- 39 mission to be filed in the office of the commission, when duly certified 40 by the director, assistant director or chairperson of the commission and 41 attested by the seal of the commission, shall be received in evidence in 42 all courts of the state of Kansas equally and with like effect as the originals. 43 Sec. 46. On and after October 1, 1997, K.S.A. 1996 Supp. 74-4202, HB 2264--Am. 66 1 as revived by section 45 of this act, is hereby amended to read as follows: 2 74-4202. (a) Within 30 days after the appointment of the members to be 3 regularly appointed within any year, the commission shall meet in the city 4 of Topeka for the purpose of organizing by selecting from its membership 5 a chairperson and such other officers as the commission may deem nec- 6 essary and appropriate. A majority of the members of the commission 7 shall constitute a quorum for the exercise of the powers or authority 8 conferred upon it. 9 (b) The commission shall receive applications for, and issue licenses 10 to, brokers and salespersons, as provided in this act and shall administer 11 the provisions of this act and the brokerage relationships in real estate 12 transactions act, as such act governs the sale or lease of real estate that is 13 one to four residential units. The commission may do all things necessary 14 and convenient for carrying into effect the provisions of the acts and may 15 adopt rules and regulations not inconsistent with the acts. For the purpose 16 of the acts, the commission shall make all necessary investigations, and 17 every licensee shall furnish to the commission such evidence as the li- 18 censee may have as to any violation the acts or any rules and regulations 19 adopted under the acts. The commission may enforce any order by an 20 action in the district court of the county where the alleged violator resides 21 or where the violation allegedly occurred. 22 (c) Each member of the commission shall be paid compensation, sub- 23 sistence allowances, mileage and other expenses as provided in K.S.A. 75- 24 3223 and amendments thereto. 25 (d) The commission shall hold meetings and hearings in the city of 26 Topeka or at such places as it shall determine at such times as it may 27 designate and on request of two or more of its members. 28 (e) The commission shall maintain an office in the city of Topeka, 29 and all files, records and property of the commission shall at all times be 30 and remain therein. 31 (f) The commission shall adopt a seal by which it shall attest its pro- 32 ceedings. Copies of all records and papers required by law or the com- 33 mission to be filed in the office of the commission, when duly certified 34 by the director, assistant director or chairperson of the commission and 35 attested by the seal of the commission, shall be received in evidence in 36 all courts of the state of Kansas equally and with like effect as the originals. 37 Sec. 47. On and after July 1, 1997, K.S.A. 1995 Supp. 58-3035, as 38 amended by section 20 of chapter 212 of the 1996 Session Laws of Kansas, 39 58-3050, as amended by section 12 of chapter 212 of the 1996 Session 40 Laws of Kansas, 58-3062, as amended by section 13 of chapter 212 of the 41 1996 Session Laws of Kansas, 58-3064, as amended by section 14 of chap- 42 ter 212 of the 1996 Session Laws of Kansas, 58-3065, as amended by 43 section 15 of chapter 212 of the 1996 Session Laws of Kansas, 58-3068, HB 2264--Am. 67 1 as amended by section 16 of chapter 212 of the 1996 Session Laws of 2 Kansas, 74-4202, as amended by section 17 of chapter 212 of the 1996 3 Session Laws of Kansas, and K.S.A. 1996 Supp. 58-30,101, as revived 4 by section 22 of this act, and 74-4209 are hereby repealed. 5 Sec. 48. On and after October 1, 1997, K.S.A. 17-2707, 58-3045 and 6 58-3063 and K.S.A. 1996 Supp. 58-3035, as revived by section 3 of this 7 act, 58-3036, 58-3037, 58-3039, 58-3042, 58-3046a, 58-3050, as revived 8 by section 11 of this act, 58-3062, as revived by section 13 of this act, 58- 9 3064, as revived by section 16 of this act, 58-3065, as revived by section 10 18 of this act, 58-3068, as revived by section 20 of this act, 58-30,101, as 11 revived amended by section 22 of this act, 58-30,102, as revived by sec- 12 tion 24 of this act, 58-30,103, as revived by section 26 of this act, 58- 13 30,104, as revived by section 28 of this act, 58-30,105, as revived by sec- 14 tion 30 of this act, 58-30,106, as revived by section 32 of this act, 15 58-30,107, as revived by section 34 of this act, 58-30,108, as revived by 16 section 36 of this act, 58-30,109, as revived by section 37 of this act, 58- 17 30,110, as revived by section 39 of this act, 58-30,111, as revived by sec- 18 tion 41 of this act, 58-30,112, as revived by section 43 of this act, and 74- 19 4202, as revived by section 45 of this act, are hereby repealed. 20 Sec. 49. This act shall take effect and be in force from and after its 21 publication in the statute book.
What is a joint listing clause?
the provisions in a listing agreement that give additional authority to the broker and obligates the broker to distribute the listing to other brokers is a. A joint listing cause. .
Under what circumstances would a Kansas seller's agent disclose his client's confidential information?
(c) A seller's or landlord's agent shall not disclose any confidential information about the client unless disclosure is required by statute or rule and regulation or failure to disclose the information would constitute fraudulent misrepresentation.
What is a transaction broker in Kansas?
The transaction broker is responsible for performing the following duties: exercising reasonable skill and care. presenting all offers in a timely manner. advising the parties regarding the transaction. suggesting that the parties obtain expert advice.
Which of the following items must be disclosed by a transaction broker?
A transaction broker must disclose any adverse material facts which are actually know about the property.