May 2015 Classification of Licensees as Independent Contractors: Is There a Storm on the Horizon? By John A. Kauerauf, Sorling Northrup Attorneys Several national industry publications have recently alerted broker managers to pending litigation filed by or on behalf of agent/licensees who claim that they ought to be classified for labor and tax law purposes as employees rather than as independent contractors. Those publications go on to pose the question—could these lawsuits signal the beginning of a movement away from the traditional broker/independent contractor relationship which has been a staple of the real estate industry for decades? Fortunately, the regulatory environment in Illinois remains conducive to maintaining the broker/independent contractor relationship, as long as the broker remains sensitive to the essential features which justify the classification of an agent as an independent contractor rather than an employee. The Gathering Storm So what’s causing all this commotion? Cases currently pending in California and Massachusetts and known by the names Bararsani v. Coldwell Banker, Cruz v. Redfin, and Monnell v. Boston Pads have caught the industry’s attention. In the Bararsani litigation, filed in 2012, an agent claims that even though he signed an independent contractor agreement with Coldwell Banker he is in fact an employee and that therefore Coldwell Banker violated California labor law by refusing to reimburse to him reasonable expenses he incurred on behalf of his “employer.” The case remains pending in California Superior Court. The Cruz case, filed in 2013, is similar in nature. Cruz was a Redfin “field agent,” classified by Redfin as an independent contractor. Redfin paid its field agents a flat fee “per event” attended such as home inspections and open houses. Cruz claims that Redfin maintained such complete control over its field agents that they were in fact employees and have been denied wages and benefits available to Redfin employees. This case remains pending in U.S. District Court in California. Across the country from California in Massachusetts, the Massachusetts Supreme Court is currently considering the claim of six real estate agents who claim that a Massachusetts’ law classifies them as employees rather than independent contractors. A lower court judge disagreed noting that the state’s real estate licensing law specifically authorizes brokers and agents to maintain independent contractor relationships, and that therefore the licensing act trumped the more general independent contractor law. D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws D.R. Legal News is published six times a year as an online publication of the Illinois Association of REALTORS® sent by e-mail to the Designated REALTOR® (D.R.) member real estate offices statewide. P a ge 1 D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 2 The Massachusetts Supreme Court heard an appeal of the lower court’s decision in December and should issue an opinion in the coming months. If agents secure a victory in any of these cases, copycat cases will surely pop up in other jurisdictions over time. The lure of a steady paycheck, overtime, potential insurance, and other benefits reserved for employees will continue to entice disgruntled agents to look to the courts to improve their financial standing. Could such a claim stay afloat in Illinois? The Safe Harbors of Illinois Illinois brokers can take comfort in the fact that several existing Illinois laws specifically address the real estate licensee as an independent contractor and bless that relationship to the extent that issue is addressed in that legislation. For example, the Illinois Unemployment Insurance Act, which generally views an independent contractor for unemployment tax purposes quite narrowly, specifically exempts from its definition of the term “employment” real estate salespersons to the extent the services performed are compensated by commission. The Illinois Workers Compensation Act also excludes from its definition of employees those persons performing services as a real estate broker, broker salesman, or salesman when such persons are paid by commission only. In addition, while not specifically mentioning real estate sales personnel, the Illinois Minimum Wage Act, exempts from its coverage “outside salesmen” which that Act defines as those who are regularly engaged in making sales where a majority of those individuals’ duties are performed away from their employers’ places of business. In 2008 the Illinois Employee Classification Act became law with the stated purpose of addressing “the practice of misclassifying employees as independent contractors.” Despite this broadly stated objective, the legislation in fact limited itself to the construction industry, and thus passed on an opportunity to be more global in addressing independent contractor classification issues in Illinois. Perhaps most importantly the Illinois Real Estate License Act continues to specifically recognize that licensees can be under the supervision of a broker when acting either as an employee of a broker or as an independent contractor to a broker, subject to a written agreement that clearly establishes and states that relationship. Illinois law thus recognizes the long standing practice of treating licensees as independent contractors. The prosecution of a Barasani, Cruz, or Monnell type claim in Illinois would therefore face choppy waters and have to navigate around these legislature pronouncements in order to have success. The likelihood of that happening should be only remote, as long as Illinois brokers don’t torpedo themselves. Don’t Rock the Boat! Cases such as those filed by Barasani, Cruz, and Monnell often arise when a broker loses sight of the core features of an independent contractor relationship and instead treats the contractor more like an employee than a contractor. While the facts in all three of these cases have yet to be fully explored by the courts, allegations made in these lawsuits suggest that some level of broker overreaching might be able to be established. For example, in Cruz, the field agents were allegedly required to obtain specific equipment © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 3 such as a smartphone, laptop, and GPS. In Monnell, the agents allege that they were subject to a dress code, subjected to disciplinary action if productivity goals were not met, had to take mandatory desk duty at the broker’s office, and even had to help clean office bathrooms. All of these requirements, due to their specificity and restrictions on the contractor’s right to control when and how he or she does business, can be asserted as being more consistent with one who is an employee rather than one who is an independent contractor. While each broker-agent relationship will be unique, and thus will require a written contract that addresses those unique aspects of that relationship, brokers should not lose sight of the following essential features of the independent contractor relationship in Illinois. 1. Payments should be commission based. 2. Payments should be for sales, not hours worked. 3. Licensees should file their own tax returns and pay their own taxes. 4. Licensees should be responsible for acquiring their own tools of the trade and bear the expenses of doing business. 5. Licensees should be free to use their own methods of doing business (subject to relevant professional regulatory and ethical rules). 6. Mandatory broker office based work should be kept to a minimum. 7. The broker-licensee relationship should have a defined termination mechanism within the written agreement. This is typically a termination upon notice clause. The notice clause distinguishes a contractor from an at will employee who is free to quit at any time without notice. The more of these features imbedded in a broker’s relationship with his or her independent contractors, the more likely the broker will face smooth sailing in the face of a classification lawsuit. As a reminder, a model sponsoring broker-sponsored licensee contract can be found under the Legal Services tab of the IAR’s website. As with any form, the form should be reviewed with the broker’s legal counsel for modification as necessary to meet the unique aspects of the broker’s business. © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 4 LegalCase Studies Research and analysis by Lisa Harms Hartzler, Sorling Northrup Attorneys Professional licensing board not immune from anti-trust violations. In North Carolina State Board of Dental Examiners v. Federal Trade Commission, 135 S.Ct. 110 (February 25, 2015), a state board licensing dentists had received complaints about non-dentists performing teeth whitening. Although there were no allegations or complaints that these services were harmful (but many complaints from dentists about the low prices being charged), the Board began issuing cease-and-desist orders asserting or implying that the non-dentists’ services constituted the unlawful practice of dentistry. As a consequence, non-dentists ceased offering teeth whitening in North Carolina. The FTC filed an administrative complaint against the Board, alleging that the Board’s concerted action to exclude non-dentists from the market for teeth whitening services constituted an anticompetitive and unfair method of competition under the Federal Trade Commission Act. The Board asserted that it was a state agency immune from anti-trust laws. The United States Supreme Court found that, while a state acting in its sovereign capacity was immune from anti-trust statutes, “a state board on which a controlling number of decision makers are active market participants in the occupation the board regulates” did not necessarily have such immunity. To assert immunity, such a state board had to meet a two-part test: (1) the state must have articulated a clear policy to allow the anticompetitive conduct as consistent with its policy goals; and (2) the state must have provided active supervision of the anti-competitive conduct. The FTC did not challenge that North Carolina evidenced a clear policy to allow the anticompetitive conduct of restricting the practice of dentistry to persons meeting certain educational requirements and qualifications and regulating that practice through an appointed board. However, the Court found that the North Carolina Board failed the second part of the test. It failed because there were no review mechanisms providing realistic assurance that the Board’s anticompetitive conduct promoted state policy, rather than merely the individual interests of the Board’s members, who were practicing dentists. The Court’s guidance on what appropriate supervisory mechanisms would satisfy its test included requiring a supervisor who was not “an active market participant” and who (a) could review the substance of an anticompetitive decision, not just the procedures followed to reach it, and (b) have the power to veto or modify particular decisions to conform to state policy. Justices Alito, Scalia, and Thomas dissented from the opinion not only because they believed the majority’s opinion misinterpreted prior case law on state immunity, but also because it left too many terms undefined, i.e., what is a market participant? What is the market? What is a controlling number? Could it be something other than a simple majority? As most professional state licensing boards are now composed of members of the profession being regulated, this case may have a significant impact on future appointments and how their decisions are implemented. © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 5 California broker enjoined from listing Nebraska properties on the Internet. In Young v. Ricketts, -- F.Supp.3d --, 2015 WL 401314 (D. Neb., January 28, 2015), a licensed California real estate broker sued the State of Nebraska and its Real Estate Commission for violating her Free Speech rights to advertise via the Internet. The Commission had issued “cease and desist” letters to the broker and threatened fines of $1,000 per day if she persisted in her conduct in Nebraska. That conduct consisted of posting Nebraska properties on the broker-only MLS database, which listings were then picked up by www.realtor.com. She also posted listings to www.forsalebyowner.com and operated the internet website www.elist.me. The broker contracted with Nebraska residents to list their homes on these sites and received a flat $95 fee, but no commission, for doing so. She did not show homes in person, did not negotiate terms of purchases and sales, did not answer questions about properties for sale, and did not handle earnest money or client funds. The broker contended that what she offered was merely an advertising service for persons wanting to sell their homes without engaging a real estate broker or agent and that the Commission’s restriction on her listings on the internet was a prior restraint on her right to free speech. The federal district court in Nebraska disagreed with the broker. First, the court found that the California broker did on some occasions communicate with Nebraska residents and provide services or advice. The websites and her own communications referred to her as “Advertising Broker” or “Email Agent,” and mentioned “Agent’s Other Real Estate Listings.” She also responded to her “clients” on several occasions with answers to questions or advice. Thus, the court found that she acted and held herself out as an unlicensed broker in Nebraska. Second, the court held that Nebraska’s regulations licensing real estate brokers and agents regulated conduct, not speech, so that the First Amendment’s right of freedom of speech was not implicated. The regulations were “content neutral” and were applied without regard to speech on any particular topic or viewpoint. “A person may list his or her own property for sale on the internet without a license. A licensed broker may list a client’s property for sale on the internet. However, an unlicensed broker who describes herself as a ‘broker’ may not list a client’s property or hold herself out as a ‘broker’ without a license.” The court held the door open to Internet listings that were truly just advertising without any representations as broker or agent and without provision of any advice; however, those simple facts were not present in this case. The court enjoined the California broker from further violations of Nebraska’s licensing laws and regulations. Auctioneer had no duty to supply Illinois Residential Real Property Disclosure Act form to trustee for delivery to successful bidder. In Hawkins v. Voss, 2015 IL App (5th) 140001 (April 9, 2015), the defendant auction company orally agreed to auction the plaintiff’s residence and to provide an auction contract and “other documents reasonably incident thereto in order to effect the sale of such real estate” if a successful bidder was procured. The plaintiff seller in this case was trustee of her own grantor’s revocable trust and was the sole primary beneficiary. Her children were contingent beneficiaries. A bidder was successful at the auction and signed a contract with the plaintiff that was supplied by the defendant auctioneer. The defendant did not supply a Residential Real Property Disclosure Act form for plaintiff seller to complete and give to the buyer. When the buyer reneged on the purchase before closing based on the failure of the plaintiff to provide an Illinois Residential Real Property Disclosure Act form, © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 6 the plaintiff sued the auctioneer, asserting that the auctioneer should have included the form in the documents needed to complete the sale. The auctioneer, however, argued that the plaintiff was exempt from the statute requiring delivery of the form and, therefore, it had no duty to supply it. The court agreed with the defendant auction company. Even though the plaintiff met the definition of a “seller” because she was a beneficiary of her own revocable trust, the Illinois Residential Real Property Disclosure Act, Section 15, explicitly exempts transfers by a fiduciary in the course of the administration of a trust. A trustee of a trust is a fiduciary and is plainly exempt from compliance with the Act. Even if a trustee who is also the sole beneficiary of the trust cannot owe a fiduciary duty to herself (which the court did not decide), in this case there were contingent beneficiaries to whom the trustee owed a fiduciary duty and was, therefore, an exempt fiduciary. Since the plaintiff trustee had no statutory duty to provide a disclosure form, the defendants also had no duty to provide a disclosure form to the plaintiff trustee. The court affirmed judgment for the defendant auction company. Liability insurance held not applicable to claim of negligent supervision against real estate broker. Castrejon v. United States Liability Insurance Company, 2015 WL 1423455 (unpublished opinion, California 4th Dist. Ct. App., March 27, 2015). In this case a couple signed a listing agreement with Century Mortgage to market their house. Century’s real estate broker of record and a real estate agent subsequently reported to the sellers that the house had been sold. The broker and agent had actually obtained a loan using the house as collateral and diverted the proceeds to a company controlled by the agent. The sellers sued the agent, broker and Century for fraud and conversion. Century tendered defense of the suit to its insurance company, which declined to defend the suit because its policy with Century did not cover fraudulent conduct. The plaintiffs argued that the policy should cover the sellers’ claim against Century for negligent supervision of the broker and the agent, but the court agreed with the insurance company. The policy stated that it would not apply to nor would the company defend or pay loss for any claim arising out of any actual or alleged criminal, fraudulent, or dishonest conduct. The court held that this language applied to a particular class of acts rather than to particular actors or insureds, so that it excluded coverage not only for claims against the actual perpetrators of a fraud but also for derivative claims against their supervisors or employers based on a theory of negligent supervision. The insurance company did not have to take up the case. Notice of challenge to re-zoning must be accomplished strictly according to statute. Scott v. City of Chicago, 2015 IL App. (1st) 140570 (March 13, 2015), involved a suit brought by neighbors against the City and the owner of a rezoned property challenging the City’s decision to rezone the property from retail to a planned development. The development would transform a parking lot and former gas station into a 13-story mixed use building including 267 multifamily residential units, parking, and ground floor commercial space. The neighbors filed suit to declare the rezoning invalid because the changes would unjustifiably diminish property values and were arbitrary and capricious. The property owner filed a motion to dismiss the neighbors’ suit because of non-compliance with the statutory notice requirements contained in the Illinois Municipal Code. When a plaintiff seeks to declare a zoning ordinance invalid, the Illinois Municipal Code applicable to municipalities of 500,000 or more requires that plaintiff to give notice to owners of all property within © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 7 250 feet in each direction of the location of the rezoned property, excluding streets, alleys and other public ways. The owners are to be determined as recorded in the office of the recorder of deeds or the registrar of titles of the county and as appear from the authentic tax records of such county. In this case, the plaintiffs failed to give notice to 19 properties listed as exempt in the Cook County Treasurer’s office and, because they based their search on a single property address rather than on the three PIN numbers comprising the subject property, did not notify a number of property owners with properties within the required 250-foot radius. The plaintiffs argued that they made a bona fide effort to notify all required property owners and substantially complied with the statute. The court did not buy those arguments. The purpose of the notice requirement is to give all property owners affected by a lawsuit a chance to support or to work against either side. Substantial compliance does not serve the purpose of the notice requirement. Further, the plaintiffs’ efforts in this case were woefully inadequate. First, they searched only the Cook County Treasurer’s records when the records of the Cook County Clerk and the Assessor also play a role in record-keeping and collection and should have been searched. In addition, the statute requires a search of the records of the Recorder of Deeds. Searching all of these data bases would have caught exempt owners and new owners who may not yet turn up in the Treasurer’s tax collection records. Finally, starting the owner search from a common address instead of the three Property Identification Numbers comprising the subject property doomed the notice process by not reaching all owners with property within 250 feet of the subject property. Based on these multiple errors, the court determined that the plaintiffs had not strictly complied with the notice required to challenge a zoning ordinance. It affirmed the dismissal of the plaintiffs’ challenge. © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 8 IAR Legal Hotline: Teams & Advertising By Betsy Urbance, Sorling Northrup Attorneys IAR Legal Hotline IAR recently instituted a pilot process entitled “IAR Ethics Citation Program.” For more information on this program, visit this page on the IAR website: http://www.illinoisrealtor.org/disputes. Advertising has emerged as one of the “hot topics” in this abbreviated complaint process. Quite a few violations involve a lack of the complete sponsoring brokerage company name in the advertisement. The REALTOR® Code of Ethics (the Code) requires REALTORS® to include their company name on ads in a “readily apparent manner.” In many cases the sponsoring brokerage company name is missing completely or is very well hidden within the ad. Statements made by REALTORS® on social media sites, like Facebook©, often exclude or hide the company name. When REALTORS® employ the use of social media in their businesses; the regulations governing their practices apply in this environment too. Another “popular” transgression emerging in the Ethics Citation Program involves misleading team names. Teams are typically functional units within a brokerage office operating in a team-like manner. If a team uses a name to identify itself, it should not be misleading in any way, and the sponsoring broker’s company name must still appear in the ad. If the team name appears to be a company name in its own right, this is problematic and is very likely to be misleading to the public. Generally speaking, a team name can’t be used instead of the sponsoring broker’s company name. In order for a team to use its name in lieu of the sponsoring broker’s company name, the sponsoring company would have to register that team name as an assumed corporate name with the appropriate agency or office, i.e. the Illinois Secretary of State’s Office for assumed corporate names and at the local court house for sole proprietorships. This is not allowed at all in the case of franchise operations. Did you miss IAR’s Fair Housing Month Legal Webinar? Download the audio podcast or full webinar at your convenience. Next Webinar: June 2015. © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 9 Missed the April 30 Managing Broker Renewal Deadline? If you missed the April 30, 2015 Managing Broker Renewal deadline, you will be unable to practice until your renewal is complete. Your license will remain in non-renewed status until your continuing education hours are complete and you have submitted your renewal application to the Illinois Department of Financial and Professional Regulation (IDFPR) and paid applicable penalty fees. IAR is here to help. Visit the Illinois Association of REALTORS® (IAR) website and the IAR REALTOR® Store for state-approved continuing education courses. http://www.illinoisrealtor.org/2015managingbrokerrenewal. Or call the IAR Licensing & Training Center at 1-800-523-5077. Here are some Q&A’s to keep in mind: Q: If I have completed my CE, my Broker Management CE, paid the fee and submitted the renewal form on or before April 30th but have not received my renewed license, may I practice now? The IDFPR website may not have been updated with your new license renewal date, but you may continue to practice so long as you are able to provide documentation that you completed the required CE hours and submitted your renewal application and timely payment of the fee, which may include a copy of the check, or if you renewed online, a screenshot of your renewal confirmation. You may also want to include a screen shot of your License Lookup on IDFPR's website for proof of an "active" status. This documentation will serve as your evidence of renewal until you receive a copy of the new license and the IDFPR website is updated with your new license renewal date. Q: Can I still practice real estate as a Managing Broker after April 30 if I have not completed all the required CE and/or completed the renewal application and paid the fee to the Illinois Department of Financial and Professional Regulation? No. Contact the Illinois Department of Financial & Professional Regulation to learn your options: IDFPR 1-800-560-6420 or FPR.realestate@illinois.gov. You should not renew your license until you have met the renewal requirements which does include continuing education. If you renew without completing the required CE you could face a monetary penalty of up to $75 per 3 hour course, or $25 per credit hour, that you were deficient (e.g., deficient 3 hours, $75 penalty). Link here to review the CE requirements for the 2015 Managing Broker license renewal: http://www.illinoisrealtor.org/2015managingbrokerrenewal. © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 10 IAR’s Unprecedented Level of Support for Local Candidates By Mike Scobey, IAR Assistant Director, Advocacy & Local Issues On April 7, 2015, Illinois REALTORS® went to the polls to elect candidates for local offices who understand and appreciate real property rights. IAR, through RPAC donations and independent expenditures, was involved in races throughout the state. Result: 71 percent of the candidates with support from IAR WON. IAR’s involvement in this year’s municipal elections was unprecedented in terms of the amount of support. In addition to direct RPAC contributions (given to 21 candidates), IAR also provided “Independent Expenditure” (IE) support to 32 candidates. This is support that is not coordinated with the candidate’s campaign and usually takes the form of direct mail to voters. Twenty of these candidates won their races. These candidates were from all over Illinois—from Chicago to Carbondale. Another form of support, known as the “Opportunity Race,” was given to 13 candidates. This is direct mail sent to REALTORS® in the candidate’s jurisdiction. Four Home Rule Defeats Also on April 7th, voters in Broadview (Cook County), McLean (McLean County), Shiloh (St. Clair County), and New Baden (Clinton and St. Clair counties) overwhelmingly voted down Home Rule initiatives in their municipalities. IAR and local associations campaigned to inform voters about the potential for communities to layer on additional taxes and regulations — without voter approval — with Home Rule powers. In addition a proposed $5 per thousand real estate transfer tax was defeated in Midlothian (Cook County). IAR sent direct mail to voters urging a NO vote on this referendum. © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 11 © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 12 Real Estate Disciplines Following are recent disciplinary actions taken by the Real Estate Division of the Illinois Department of Financial and Professional Regulation, http://www.idfpr.com/News/Disciplines/DiscReports.asp • • • • • • • • • • • • • A real estate managing broker license was placed on probation for one year and fined $1,000 for failing to disclose information to the Department on an application. A real estate managing broker license was revoked for violating the terms of a Consent Order. A licensed real estate leasing agent student license was revoked and fined $2,500 for repeatedly violating his "refuse to renew" status and for identifying himself falsely in order to wrongfully take a security deposit. A real estate broker license and real estate broker partnership license were reprimanded, ordered to cease and desist unlicensed practice (non-renewed) of real estate, and fined $1,000 owed jointly and severally. A real estate broker license fined $1,000 and ordered to complete coursework for failing to complete his continuing education for the May 1, 2009 to April 30, 2012, renewal period on time and also for failing to complete his continuing education for the period of May 1, 2012 to respondent's late renewal on December 3, 2014. A property inspection business was ordered to cease and desist the unlicensed practice of real estate. A real estate managing broker license was placed on probation for 12 months and fined $1,000 for errors and omissions in the escrow and business records in his control. A real estate broker license was revoked and fined $2,500 for engaging in misrepresentation and submitting false and fraudulent documents in connection with rental transactions. A real estate broker license was revoked pursuant to the judgment paid out of the Real Estate Recovery Fund on behalf of the licensee. A real estate managing broker license was placed in refuse to renew status for being more than 30 days delinquent in the payment of child support. A real estate broker license was reprimanded and fined $1,500 for entering into several listing agreement modifications without the written authorization of one of the property owners; omitting other required information, such as a termination date for the agreement and a listing price; marketing the property with no valid listing agreement; and submitting a Mutual Cancelation Agreement to her sponsoring broker which was signed by only one of her seller clients. A real estate broker license was fined $500 for his violations of Illinois license law. A real estate broker license was placed on indefinite probation for a minimum of two years for failing to obtain a written listing agreement and a written dual agency agreement in a real estate transaction. © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 13 The Illinois spring housing market got off to a strong start in March with sharp gains in year-over-year home sales and median prices. According economist Dr. Geoffrey J.D. Hewings, Director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois: “March was an excellent month for the housing market with robust growth in both sales and prices. When adjusted for inflation, median home prices have recovered to 79 percent of their 2008 levels in Illinois and 74 percent of the prior levels in the Chicago PMSA. A further one to three years is anticipated for full recovery in the PMSA.” Get the latest REAL forecast and IAR home sales report, plus the FastStats clickable State Map here: http://www.illinoisrealtor.org/membermarketstats. IAR Calendar Find event details at http://www.illinoisrealtor.org/events • May 6-7 - IAR Spring Conference & Expo, Collinsville • May 11-16 - REALTOR® Legislative Meetings & Expo, Washington D.C. • June 15-16 - IAR Business Meetings, Hilton Springfield • June 16 - REALTOR® of the YEAR, Springfield • October 5-6 - IAR Business Meetings, Oak Brook Hills Resort-Hilton • October 6 - IAR Inaugural Gala, Oak Brook Hills Resort-Hilton • December 2-3 – Illinois Graduate REALTOR® Institute, Peoria © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube D . R . L e g a l Ne w s | w ww. i l l i noi s r eal to r. or g/ DRl eg al n e ws P a ge 14 TRID-RESPA Webinar May 4 Register for this free IAR webinar tailored for the Illinois Managing Broker. Register here: http://bit.ly/1OeWytu © Co p yri gh t Il l i noi s A s s oc i a ti on o f RE A LT O RS ® 5 22 S o uth Fi ft h S tr e et, P . O. B o x 1 94 51, S p ri ng fi el d, Il l i noi s 6 27 94 -9 45 1 | 21 7 /52 9 -2 60 0 | F A X 2 17 /5 29 -3 904 www.illinoisrealtor.org | www.IARlicenselaw.org | www.YourIllinoisHome.com | www.IARbuzz.com W E ’ D L I K E T O H E AR F R O M Y O U ! Send comments and story ideas to iarnews@iar.org Find us onFacebook.com | Twitter.com/ILREALTOR | LinkedIn.com | YouTube
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