The following questions and answers are provided by Florida Realtors, the state's real estate association. Questions about these opinions should be directed to the association's legal department at (407) 436-1409.
Q: I work as an agent for Brokerage A. I want to take on a second job as an administrative assistant for a broker at Brokerage B. Is that OK?
A: This is a situation that requires extremely detailed consideration, especially with regard to the actions you'll be performing at Brokerage B, the restrictions in your independent contractor agreement with Broker A and the sizable probability of misconception and confusion by members of the public in their view of your authority and position in these different roles.
For this reason, we don't recommend such employment relationships with different real estate companies, even though it's technically possible (although extremely difficult to perform, in a practical sense) to envision a scenario that would not violate Florida law.
Technically speaking, if you're not practicing any real estate activity at Brokerage B, there's nothing prohibiting this type of arrangement in your agreement or office policy with Brokerage A. If you're able to create a clear understanding with members of the public as to what unique capacities you're engaged in with regarding each employer, you would not be in violation of Florida law for this activity.
Q: I am hosting an open house for local real estate professionals to become acquainted with a new residential development and would like to have participants drop their business cards into a fishbowl and then randomly draw names from the bowl and award prizes. Is this permissible?
A: No. This activity would be considered a "game of chance" and would violate Chapter 849, Florida Statutes, which deals with gambling; however, prizes may be awarded based on the results of a "game of skill."
Q: Do referral fees have to flow through a brokerage company, or can they be paid directly to an associate?
A: Referral fees should flow through the brokerage company to the associate, in accordance with Section 475.42(1)(d), Florida Statutes. Although FREC says that an associate may be paid directly at closing if a broker instructs the closing agent (in a specific writing) to authorize direct payment, FREC has not expanded this to include other situations.
Q: May I share a referral fee with someone who doesn't hold a real estate license?
A: Section 475.25(1)(h), Florida Statutes, prohibits a Florida licensee from paying a fee or compensating someone who doesn't hold a real estate license in Florida or another state.
However, there's a very limited finder's fee exception in Section 475.011(13), Florida Statutes that permits a property management firm or the landlord personally to pay up to $50 per transaction to an apartment tenant who refers another tenant to live in the same complex.
Q: I became licensed as a sales associate by the DBPR just over a year ago. One of my older colleagues at the office says that makes me eligible to get licensed as a broker. Is this true?
A: No. While that would have been true in 2007, the law was changed in 2008. Section 475.17(2)(b)1, Florida Statutes, now provides that to become licensed as a broker, a person must have held an active real estate sales associate's license for at least 24 months during the preceding five years.
Q: I waited until the last minute to do the required postlicensure education. Unfortunately, I failed to complete it prior to the expiration date. My license is now null and void. Is it possible to obtain an extension of time?
A: Perhaps. The Florida Real Estate Commission may allow an additional six-month period to complete the postlicensure education if you were unable, due to "individual physical hardship," to complete the course within the required time. Individual physical hardship is defined as a case where the licensee cannot, by reason of a physical disability, attend the place where the classes are conducted. FREC requires the extension request to be in writing and supported by statements of doctors and other persons having knowledge of the facts.
Q: I'm a sales associate, and a seller wants me to list her property. We've decided to enter into a 12-month listing agreement, with a provision that it will renew automatically for an additional six months if the seller doesn't cancel it in writing. May the listing agreement renew automatically?
A: No. Section 475.25(1)(r), Florida Statutes, provides that it's a violation of real estate licensing law if a real estate licensee "has failed in any written listing agreement to include a definite expiration date, description of the property, price and terms, fee or commission, and a proper signature of the principal(s); and has failed to give the principal(s) a legible, signed, true and correct copy of the listing agreement within 24 hours of obtaining the written listing agreement. The written listing agreement shall contain no provision requiring the person signing the listing to notify the broker of the intention to cancel the listing after such definite expiration date."
Q: I am a recently married sales associate. I've decided to legally change my name to my married name. Am I required to change my name on my sales associate license?
A: Yes. Rule 61J2-9.007, Florida Administrative Code, provides that when there's been a legal name change, the licensee shall file a request for the real estate license to be reissued in the new name. For a new license to be reissued, a copy of the legal document that legally changed the name (marriage license in this case) must be included in this request.
Q: I'm a sales associate and want to set up a company using my team name so that my broker can pay my commissions to this separate company. May I do this?
A: No. Pursuant to Section 475.161, Florida Statutes, a sales associate or broker associate must use his or her legal name as it appears on his or her real estate license when incorporating as a limited liability company (LLC), professional corporation (PA) or professional limited liability company (PLLC).
Q: May a sales associate be paid directly for conducting a broker price opinion?
A: No. Section 475.42(1)(d), Florida Statutes, does not allow sales associates to collect any money in connection with a real estate brokerage transaction, whether as commission or other payment, except in the name of their employer—the broker. BPOs fall within the defi nition of real estate brokerage activity— "appraising" property—as per Section 475.01, Florida Statutes.
Q: I am a real estate broker and an appraiser. I just entered a plea of nolo contendere to DUI (a misdemeanor). Is there a duty to report this misdemeanor to the Florida Real Estate Commission or the Florida Real Estate Appraisal Board?
A: Yes. As of Oct. 1, 2009, Section 455.227(1)(t), Florida Statutes, requires you to report this misdemeanor to the FREC and the FREAB within 30 days after the plea or after being found guilty. Prior to Oct. 1, 2009, real estate licensees and appraisers had a duty to report only felonies to the FREC and the FREAB.
Q: I'm a sales associate and I want to open a real estate corporation. May I be an officer or director of this real estate corporation?
A: A sales associate may be a shareholder of a real estate corporation; however, he or she may not be an officer or director of that corporation as per Chapter 61J2-5.016, Florida Administrative Code. Furthermore, the corporation must have a qualifying broker registered with the Department of Business and Professional Regulation. The qualifying broker of the corporation must be an officer or director of the real estate corporation.
Q: I'm a real estate licensee with a listing. I've been contacted by a sales associate who has a buyer interested in making an offer on my seller's property. However, I've discovered that this sales associate's license is inactive, and that this person is not currently working for a broker. May I still pay the cooperating agent a commission?
A: No. Section 475.25(1)(h), Florida Statutes, provides that a real estate licensee may not share commission with a person not properly licensed as a broker, broker-associate or sales associate.
Further, since the cooperating agent's license is inactive, he or she is in violation of Section 475.42(1)(a), Florida Statutes, which is a felony of the third degree. If the agent's license is inactive, the agent may not receive compensation.