REQUIRES TWO THIRDS MAJORITY VOTE (§ 4)                 

                                            (REPRINTED WITH ADOPTED AMENDMENTS)

 

Senate Bill No. 418–Senator Schneider

 

March 19, 2001

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Makes various changes to provisions governing sale of real property. (BDR 54‑159)

 

FISCAL NOTE:            Effect on Local Government: No.

                                    Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to real property; clarifying the duties owed by a real estate salesman, broker-salesman and broker; establishing renewal requirements for the licensure of such real estate licensees; limiting the time for bringing certain civil actions; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1    Section 1.  NRS 645.252 is hereby amended to read as follows:

1-2    645.252  A licensee who acts as an agent in a real estate transaction:

1-3    1.  Shall disclose to each party to the real estate transaction as soon as

1-4  is practicable:

1-5    (a) Any material and relevant facts, data or information which he

1-6  knows, or which by the exercise of reasonable care and diligence he should

1-7  have known, relating to the property which is the subject of the transaction.

1-8    (b) Each source from which he will receive compensation as a result of

1-9  the transaction.

1-10    (c) That he is a principal to the transaction or has an interest in a

1-11  principal to the transaction.

1-12    (d) Except as otherwise provided in NRS 645.253, that he is acting for

1-13  more than one party to the transaction. If a licensee makes such a

1-14  disclosure, he must obtain the written consent of each party to the

1-15  transaction for whom he is acting before he may continue to act in his

1-16  capacity as an agent. The written consent must include:

1-17      (1) A description of the real estate transaction.

1-18      (2) A statement that the licensee is acting for two or more parties to

1-19  the transaction who have adverse interests and that in acting for these

1-20  parties, the licensee has a conflict of interest.

1-21      (3) A statement that the licensee will not disclose any confidential

1-22  information for 1 year after the revocation or termination of any brokerage

2-1  agreement entered into with a party to the transaction, unless he is required

2-2  to do so by a court of competent jurisdiction or he is given written

2-3  permission to do so by that party.

2-4       (4) A statement that a party is not required to consent to the licensee

2-5  acting on his behalf.

2-6       (5) A statement that the party is giving his consent without coercion

2-7  and understands the terms of the consent given.

2-8    (e) Any changes in his relationship to a party to the transaction.

2-9    2.  Shall exercise reasonable skill and care with respect to all parties to

2-10  the real estate transaction.

2-11    3.  Shall provide to each party to the real estate transaction the

2-12  appropriate form prepared by the division pursuant to NRS 645.193.

2-13    4.  Unless otherwise agreed upon in writing, owes no duty to:

2-14    (a) Independently verify the accuracy of a statement made by a source

2-15  reasonably believed by the licensee to be reliable.

2-16    (b) Conduct an independent inspection of the financial condition of a

2-17  party to a real estate transaction.

2-18    Sec. 2.  NRS 645.257 is hereby amended to read as follows:

2-19    645.257  1.  [A] Except as otherwise provided in subsection 4, a

2-20  person who has suffered damages as the proximate result of a licensee’s

2-21  failure to perform any duties required by NRS 645.252, 645.253 or

2-22  645.254 or the regulations adopted to carry out those sections may bring an

2-23  action against the licensee for the recovery of his actual damages.

2-24    2.  In such an action, any knowledge of the client of the licensee of

2-25  material facts, data or information relating to the real property which is the

2-26  subject of the real estate transaction may not be imputed to the licensee.

2-27    3.  In an action brought by a person against a licensee pursuant to

2-28  subsection 1, the standard of care owed by a licensee is the degree of care

2-29  that a reasonably prudent real estate licensee would exercise and is

2-30  measured by the degree of knowledge required to be obtained by a real

2-31  estate licensee pursuant to NRS 645.343 and 645.345.

2-32    4.  An action brought to enforce the provisions of this section must be

2-33  commenced not later than 1 year after the date of recordation, the date of

2-34  the close of escrow or the date of occupancy, whichever occurs first.

2-35    Sec. 3.  NRS 645.259 is hereby amended to read as follows:

2-36    645.259  A licensee may not be held liable for [a] :

2-37    1.  A misrepresentation made by his client unless the licensee:

2-38    [1.] (a) Knew his client made the misrepresentation; and

2-39    [2.] (b) Failed to inform the person to whom the client made the

2-40  misrepresentation that the statement was false.

2-41    2.  The failure of the seller to make the disclosures required by NRS

2-42  113.130 and 113.135 if:

2-43    (a) The client engaged the services of an inspector certified pursuant

2-44  to chapter 645D of NRS or another appropriate licensed or certified

2-45  expert; or

2-46    (b) The information that would have been disclosed pursuant to NRS

2-47  113.130 and 113.135 is a public record which is readily available to the

2-48  client.

 

3-1    Sec. 4.  NRS 645.490 is hereby amended to read as follows:

3-2    645.490  1.  Upon satisfactorily passing the written examination and

3-3  upon complying with all other provisions of law and conditions of this

3-4  chapter, a license shall thereupon be granted by the division to the

3-5  successful applicant therefor as a real estate broker, broker-salesman or

3-6  salesman, and the applicant upon receiving the license may conduct the

3-7  business of a real estate broker, broker-salesman or salesman in this state.

3-8    2.  The division shall issue licenses as real estate broker, broker-

3-9  salesman or salesman to all applicants who qualify and comply with all

3-10  provisions of law and all requirements of this chapter.

3-11    3.  A real estate broker, broker-salesman or salesman shall renew his

3-12  license with the division within 1 year immediately after initial licensing

3-13  and thereafter shall renew his license every 2 years.

3-14    Sec. 5.  NRS 645.575 is hereby amended to read as follows:

3-15    645.575  1.  The commission shall prescribe standards for the

3-16  continuing education of persons licensed pursuant to this chapter by

3-17  adopting regulations which include:

3-18    (a) For renewal of a license which is on active status, a requirement for

3-19  the hours of attendance at any approved educational course, seminar or

3-20  conference of:

3-21      (1) Thirty hours within the [2-year period] first year immediately

3-22  after initial licensing; and

3-23      (2) Fifteen hours within each subsequent 2-year period before

3-24  renewal.

3-25  For each period, at least 6 of the hours must be devoted to ethics,

3-26  professional conduct or the legal aspects of real estate.

3-27    (b) For reinstatement of a license which has been placed on inactive

3-28  status, a requirement for total attendance at any approved educational

3-29  course, seminar or conference of:

3-30      (1) Thirty hours if the license was on inactive status for 2 years or

3-31  less during the initial license period;

3-32      (2) Fifteen hours if the license was on inactive status for a period of 2

3-33  years or less, no part of which was during the initial license period;

3-34      (3) Forty-five hours if the license was on inactive status for a period

3-35  of more than 2 years, part of which was during the initial license period; or

3-36      (4) Thirty hours if the license was on inactive status for a period of

3-37  more than 2 years, no part of which was during the initial

3-38  license period.

3-39  For each period, at least 6 of the hours must be devoted to ethics,

3-40  professional conduct or the legal aspects of real estate.

3-41    (c)A basis and method of qualifying educational programs and

3-42  certifying attendance which will satisfy the requirements of this section.

3-43    (d) A procedure for the evaluation of petitions based on a claim of

3-44  equivalency with the requirements of paragraph (a) or (b).

3-45    (e) A system of controlling and reporting qualifying attendance.

3-46    (f) A statement of the conditions for which an extension of time may be

3-47  granted to comply with the continuing education requirements as well as a

3-48  method of applying and qualifying for an extension.

4-1    2.  The standards prescribed in subsection 1 must permit alternatives of

4-2  subject material, taking cognizance of specialized areas of practice and

4-3  alternatives in sources of programs considering availability in area and

4-4  time. The standards must include, where qualified, generally accredited

4-5  educational institutions, private vocational schools, educational programs

4-6  and seminars of professional societies and organizations, other organized

4-7  educational programs on technical subjects, or equivalent offerings. The

4-8  commission shall qualify only those educational courses that it determines

4-9  address the appropriate subject matter and are given by an accredited

4-10  university or community college. Subject to the provisions of this section,

4-11  the commission has exclusive authority to determine what is an appropriate

4-12  subject matter for qualification as a continuing education course.

4-13    3.  Except as otherwise provided in this subsection, the license of a

4-14  broker, broker-salesman or salesman must not be renewed or reinstated

4-15  unless the administrator finds that the applicant for the renewal license or

4-16  for reinstatement to active status has completed the continuing education

4-17  required by this chapter. Any amendment or repeal of a regulation does not

4-18  operate to prevent an applicant from complying with this section for the

4-19  next licensing period following the amendment or repeal.

4-20    Sec. 6.  NRS 645.635 is hereby amended to read as follows:

4-21    645.635  The commission may take action pursuant to NRS 645.630

4-22  against any person subject to that section who is guilty of:

4-23    1.  Offering real estate for sale or lease without the knowledge and

4-24  consent of the owner or his authorized agent or on terms other than those

4-25  authorized by the owner or his authorized agent.

4-26    2.  Negotiating a sale, exchange or lease of real estate directly with [an

4-27  owner or lessor] a client if he knows that the [owner] client has a

4-28  brokerage agreement in force in connection with the property granting an

4-29  exclusive agency or an exclusive right to sell to another broker, unless

4-30  permission in writing has been obtained from the other broker.

4-31    3.  Failure to deliver within a reasonable time a completed copy of any

4-32  purchase agreement or offer to buy or sell real estate to the purchaser or to

4-33  the seller.

4-34    4.  Failure to deliver to the seller in each real estate transaction, within

4-35  10 business days after the transaction is closed, a complete, detailed

4-36  closing statement showing all of the receipts and disbursements handled by

4-37  him for the seller, failure to deliver to the buyer a complete statement

4-38  showing all money received in the transaction from the buyer and how and

4-39  for what it was disbursed, or failure to retain true copies of those

4-40  statements in his files. The furnishing of those statements by an escrow

4-41  holder relieves the broker’s, broker-salesman’s or salesman’s responsibility

4-42  and must be deemed to be compliance with this provision.

4-43    5.  Representing to any lender, guaranteeing agency or any other

4-44  interested party, verbally or through the preparation of false documents, an

4-45  amount in excess of the actual sale price of the real estate or terms differing

4-46  from those actually agreed upon.

4-47    6.  Failure to produce any document, book or record in his possession

4-48  or under his control, concerning any real estate transaction under

4-49  investigation by the division.

5-1    7.  Failure to reduce a bona fide offer to writing where a proposed

5-2  purchaser requests that it be submitted in writing.

5-3    8.  Failure to submit all written bona fide offers to a seller when the

5-4  offers are received before the seller accepts an offer in writing and until the

5-5  broker has knowledge of that acceptance.

5-6    9.  Refusing because of race, color, national origin, sex or ethnic group

5-7  to show, sell or rent any real estate for sale or rent to qualified purchasers

5-8  or renters.

5-9    10.  Knowingly submitting any false or fraudulent appraisal to any

5-10  financial institution or other interested person.

5-11    Sec. 7.  NRS 113.140 is hereby amended to read as follows:

5-12    113.140  1.  NRS 113.130 does not require a seller to disclose a defect

5-13  in residential property of which he is not aware.

5-14    2.  A completed disclosure form does not constitute an express or

5-15  implied warranty regarding any condition of residential property.

5-16    3.  Neither this chapter nor chapter 645 of NRS relieves a buyer or

5-17  prospective buyer of the duty to exercise reasonable care to protect

5-18  himself, including, without limitation, those facts which are known to or

5-19  are within the diligent attention and observation of the buyer or

5-20  prospective buyer.

5-21    Sec. 8.  1.  This section and sections 1, 2, 3, 5, 6 and 7 of this act

5-22  become effective on October 1, 2001.

5-23    2.  Section 4 of this act becomes effective on July 1, 2002.

 

5-24  H