Office of the Revisor of Statutes
Minnesota Session Laws - 2001, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 208-S.F.No. 1541
An act relating to commerce; regulating currency
exchanges, real estate brokers, real property
appraisers, subdivided land sales licenses,
residential contractors, notaries public, and
collection agencies; modifying certain continuing
education requirements; regulating certain fees,
costs, duties, rights, and penalties; regulating
nonprofit corporations; requiring a study;
appropriating money; amending Minnesota Statutes 2000,
sections 45.0295; 53A.081, subdivision 2; 58.10,
subdivision 1, by adding a subdivision; 60K.19,
subdivision 8; 72B.04, subdivisions 6, 7; 80B.03,
subdivision 4a; 82.195, subdivision 2; 82.196,
subdivision 2; 82.197, subdivisions 1, 4, by adding a
subdivision; 82.22, subdivision 13; 82.24, subdivision
8; 82.27, subdivision 3; 82.34, subdivision 15, by
adding a subdivision; 82B.14; 83.25, subdivision 1;
317A.203; 326.91, subdivision 1; 326.975, subdivision
1; 332.41; 359.02; 507.45, subdivision 3.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 2000, section 45.0295, is
amended to read:
45.0295 [FEES.]
(a) The following fees shall be paid to the commissioner:
(1) for each hour or fraction of one hour of education
course approval for continuing education sought, $10; and
(2) for each continuing education course coordinator
approval, $100.
(b) All fees paid to the commissioner under this section
are nonrefundable, except that an overpayment of a fee shall be
returned upon proper application.
Sec. 2. Minnesota Statutes 2000, section 53A.081,
subdivision 2, is amended to read:
Subd. 2. [INVESTIGATION.] The commissioner may at any time
and shall at least once in each year investigate the currency
exchange business of any licensee and of every person,
partnership, association, and corporation engaged in the
business of operating a currency exchange in the manner provided
under section 45.027.
Sec. 3. Minnesota Statutes 2000, section 58.10,
subdivision 1, is amended to read:
Subdivision 1. [AMOUNTS.] The following fees must be paid
to the commissioner:
(1) for an initial residential mortgage originator license,
$800 $850, $50 of which is credited to the consumer education
account in the special revenue fund;
(2) for a renewal license, $400 $450, $50 of which is
credited to the consumer education account in the special
revenue fund;
(3) for an initial residential mortgage servicer's license,
$1,000;
(4) for a renewal license, $500; and
(5) for a certificate of exemption, $100.
Sec. 4. Minnesota Statutes 2000, section 58.10, is amended
by adding a subdivision to read:
Subd. 3. [CONSUMER EDUCATION ACCOUNT; MONEY CREDITED AND
APPROPRIATED.] (a) The consumer education account is created in
the special revenue fund. Money credited to this account may be
appropriated to the commissioner for the purpose of making
grants to programs and campaigns designed to help consumers
avoid being victimized by unscrupulous lenders and mortgage
brokers. Preference shall be given to programs and campaigns
designed by coalitions of public sector, private sector, and
nonprofit agencies, institutions, companies, and organizations.
(b) A sum sufficient is appropriated annually from the
consumer education account to the commissioner to make the
grants described in paragraph (a).
Sec. 5. Minnesota Statutes 2000, section 60K.19,
subdivision 8, is amended to read:
Subd. 8. [MINIMUM EDUCATION REQUIREMENT.] Each person
subject to this section shall complete a minimum of 30 credit
hours of courses accredited by the commissioner during each
24-month licensing period. Any person whose initial licensing
period extends more than six months shall complete 15 hours of
courses accredited by the commissioner during the initial
license period. Any person teaching or lecturing at an
accredited course qualifies for 1-1/2 three times the number of
credit hours that would be granted to a person completing the
accredited course. No more than 15 credit hours per licensing
period may be credited to a person for courses sponsored by,
offered by, or affiliated with an insurance company or its
agents. Courses sponsored by, offered by, or affiliated with an
insurance company or agent may restrict its students to agents
of the company or agency.
Sec. 6. Minnesota Statutes 2000, section 72B.04,
subdivision 6, is amended to read:
Subd. 6. [EXCEPTIONS.] A person who on January 1, 1972,
meets all of the qualifications specified in subdivision 2 with
regard to the class of license applied for and, if experience is
one of the requisites, has gained the experience within the
three years next preceding January 1, 1972, shall be eligible
for the issuance of a license without taking an examination.
A person who has held a license of any given class or in
any field or fields within three years prior to the application
shall be entitled to a renewal of the license in the same class
or in the same fields without taking an examination.
A person applying for a license as a crop hail adjuster
shall not be required to comply with the requirements of
subdivision 5.
The commissioner may issue a license under sections 72B.01
to 72B.14 without an examination, if the applicant presents
sufficient and satisfactory evidence of having passed a similar
examination in another state and if the commissioner, with the
advice of the advisory board, has determined that the standards
of such other state are equivalent to those in Minnesota for the
class of license applied for. Any applicant who presents
sufficient and satisfactory evidence of having successfully
completed all six parts of the insurance institute of America
program in adjusting or other programs approved by the
commissioner shall be entitled to an adjuster's license without
taking the examination prescribed in subdivision 5.
Sec. 7. Minnesota Statutes 2000, section 72B.04,
subdivision 7, is amended to read:
Subd. 7. [LICENSE TERM.] Every adjuster's and public
adjuster solicitor's license shall be for a term expiring on
October 31 next following the date of its issuance, and may be
renewed for the ensuing calendar year upon the timely filing of
an application for renewal. (a) Initial licenses issued under
this section are valid for a period not to exceed two years.
Each initial license must expire on October 31 of the expiration
year assigned by the commissioner.
(b) Licenses issued under this section may be renewed upon
the timely filing of an application for renewal. Every renewal
license is valid for a period of 24 months.
Sec. 8. Minnesota Statutes 2000, section 80B.03,
subdivision 4a, is amended to read:
Subd. 4a. Within three calendar business days of the date
of filing of the registration statement, the commissioner may by
order summarily suspend the effectiveness of the takeover offer
if the commissioner determines that the registration statement
does not contain all of the information specified in
subdivisions 2 and 6 or that the takeover offer materials
provided to offerees do not provide full disclosure to offerees
of all material information concerning the takeover offer. The
suspension shall remain in effect only until the determination
following a hearing held pursuant to subdivision 5.
Sec. 9. Minnesota Statutes 2000, section 82.195,
subdivision 2, is amended to read:
Subd. 2. [CONTENTS.] All listing agreements must be in
writing and must include:
(1) a definite expiration date;
(2) a description of the real property involved;
(3) the list price and any terms required by the seller;
(4) the amount of any compensation or commission or the
basis for computing the commission;
(5) a clear statement explaining the events or conditions
that will entitle a broker to a commission;
(6) information regarding an override clause, if
applicable, including a statement to the effect that the
override clause will not be effective unless the licensee
supplies the seller with a protective list within 72 hours after
the expiration of the listing agreement;
(7) the following notice in not less than ten point
boldface type immediately preceding any provision of the listing
agreement relating to compensation of the licensee:
"NOTICE: THE COMMISSION RATE COMPENSATION FOR THE SALE,
LEASE, RENTAL, OR MANAGEMENT OF REAL PROPERTY SHALL BE
DETERMINED BETWEEN EACH INDIVIDUAL BROKER AND ITS THE BROKER'S
CLIENT.";
(8) for residential property listings, the following "dual
agency" disclosure statement:
If a buyer represented by broker wishes to buy your
property, a dual agency will be created. This means that broker
will represent both you and the buyer(s), and owe the same
duties to the buyer(s) that broker owes to you. This conflict
of interest will prohibit broker from advocating exclusively on
your behalf. Dual agency will limit the level of representation
broker can provide. If a dual agency should arise, you will
need to agree that confidential information about price, terms,
and motivation will still be kept confidential unless you
instruct broker in writing to disclose specific information
about you. All other information will be shared. Broker cannot
act as a dual agent unless both you and the buyer(s) agree to
it. By agreeing to a possible dual agency, you will be giving
up the right to exclusive representation in an in-house
transaction. However, if you should decide not to agree to a
possible dual agency, and you want broker to represent you, you
may give up the opportunity to sell your property to buyers
represented by broker.
Seller's Instructions to Broker
Having read and understood this information about dual
agency, seller(s) now instructs broker as follows:
....... Seller(s) will agree to a dual agency
representation and will consider offers made
by buyers represented by broker.
....... Seller will not agree to a dual agency
representation and will not consider offers
made by buyers represented by broker.
......................... .........................
Seller Broker
......................... By: ....................
Seller Salesperson
Date: ..................;
(9) a notice requiring the seller to indicate in writing
whether it is acceptable to the seller to have the licensee
arrange for closing services or whether the seller wishes to
arrange for others to conduct the closing. The notice must also
include the disclosure of any controlled business arrangement,
as the term is defined in United States Code, title 12, section
2602, between the licensee and the real estate closing agent
through which the licensee proposes to arrange closing services;
and
(10) for residential listings, a notice stating that after
the expiration of the listing agreement, the seller will not be
obligated to pay the licensee a fee or commission if the seller
has executed another valid listing agreement pursuant to which
the seller is obligated to pay a fee or commission to another
licensee for the sale, lease, or exchange of the real property
in question. This notice may be used in the listing agreement
for any other type of real estate.
Sec. 10. Minnesota Statutes 2000, section 82.196,
subdivision 2, is amended to read:
Subd. 2. [CONTENTS.] All buyer's broker agreements must be
in writing and must include:
(1) a definite expiration date;
(2) the amount of any compensation or commission, or the
basis for computing the commission;
(3) a clear statement explaining the services to be
provided to the buyer by the broker, and the events or
conditions that will entitle a broker to a commission or other
compensation;
(4) a provision for cancellation of the agreement by either
party upon terms agreed upon by the parties; a clear statement
explaining if the agreement may be canceled and the terms under
which the agreement may be canceled;
(5) information regarding an override clause, if
applicable, including a statement to the effect that the
override clause will not be effective unless the licensee
supplies the buyer with a protective list within 72 hours after
the expiration of the buyer's broker agreement;
(6) the following notice in not less than ten point bold
face type immediately preceding any provision of the buyer's
broker agreement relating to compensation of the licensee:
"NOTICE: THE COMMISSION RATE COMPENSATION FOR THE
PURCHASE, LEASE, RENTAL, OR MANAGEMENT OF REAL PROPERTY IS
NEGOTIABLE AND SHALL BE DETERMINED BETWEEN EACH INDIVIDUAL
BROKER AND ITS THE BROKER'S CLIENT.";
(7) the following "dual agency" disclosure statement:
If you choose to purchase a property listed by broker, a
dual agency will be created. This means that broker will
represent both you and the seller(s), and owe the same duties to
the seller(s) that broker owes to you. This conflict of
interest will prohibit broker from advocating exclusively on
your behalf. Dual agency will limit the level of representation
broker can provide. If a dual agency should arise, you will
need to agree that confidential information about price, terms,
and motivation will still be kept confidential unless you
instruct broker in writing to disclose specific information
about you. All other information will be shared. Broker cannot
act as a dual agent unless both you and the seller(s) agree to
it. By agreeing to a possible dual agency, you will be giving
up the right to exclusive representation in an in-house
transaction. However, if you should decide not to agree to a
possible dual agency, and you want broker to represent you, you
may give up the opportunity to purchase the properties listed by
broker.
Buyer's Instructions to Broker
....... Buyer(s) will agree to a dual agency representation
and will consider properties listed by broker.
....... Buyer will not agree to a dual agency
representation and will not consider
properties listed by broker.
......................... .........................
Buyer Broker
......................... By: ....................
Buyer Salesperson
Date: ...................; and
(8) for buyer's broker agreements which involve residential
real property, a notice stating that after the expiration of the
buyer's broker agreement, the buyer will not be obligated to pay
the licensee a fee or commission if the buyer has executed
another valid buyer's broker agreement pursuant to which the
buyer is obligated to pay a fee or commission to another
licensee for the purchase, lease, or exchange of real property.
Sec. 11. Minnesota Statutes 2000, section 82.197,
subdivision 1, is amended to read:
Subdivision 1. [AGENCY DISCLOSURE.] A real estate broker
or salesperson shall provide to a consumer in the sale and
purchase of a residential real property transaction at the first
substantive contact with the consumer an agency disclosure form
in substantially the form set forth in subdivision 4. The
agency disclosure form shall be intended to provide a
description of available options for agency and nonagency
relationships, and a description of the role of a licensee under
each option. The agency disclosure form shall provide a
signature line for acknowledgment of receipt by the consumer.
Sec. 12. Minnesota Statutes 2000, section 82.197,
subdivision 4, is amended to read:
Subd. 4. [AGENCY DISCLOSURE FORM.] The agency disclosure
form shall be in substantially the form set forth below:
AGENCY RELATIONSHIPS IN REAL ESTATE TRANSACTIONS
Minnesota law requires that early in any relationship, real
estate brokers or salespersons discuss with consumers what type
of agency representation or relationship they desire.(1) The
available options are listed below. This is not a contract.
This is an agency disclosure form only. If you desire
representation, you must enter into a written contract according
to state law (a listing contract or a buyer representation
contract). Until such time as you choose to enter into a
written contract for representation or assistance, you will be
treated as a customer of the broker or salesperson and not
represented by the brokerage and will not receive any
representation from the broker or salesperson. The broker or
salesperson would then will be acting as a Seller's broker
Facilitator (see paragraph I V below), or as a nonagent (see
paragraph IV below) unless the broker or salesperson is
representing another party as described below.
ACKNOWLEDGMENT: I/We acknowledge that I/We have been
presented with the below-described options. I/We understand
that until I/We have signed a representation contract, I/We are
not represented by the broker/salesperson and information given
to the broker/salesperson may be disclosed. I/We understand
that written consent is required for a dual agency
relationship. THIS IS A DISCLOSURE ONLY, NOT A CONTRACT FOR
REPRESENTATION.
............... ..........
Signature Date
............... ..........
Signature Date
I.
Seller's Broker: A broker who lists a property, or a
salesperson who is licensed to the listing broker,
represents the Seller and acts on behalf of the Seller. A
broker or salesperson working with a Buyer may also act as
a subagent of the Seller, in which case the Buyer is the
broker's customer and is not represented by that broker. A
Seller's broker owes to the Seller the fiduciary duties
described below.(2) The broker must also disclose to the
Buyer any material facts as defined in Minnesota Statutes,
section 82.197, subdivision 6, of which the broker is aware
that could adversely and significantly affect the Buyer's
use or enjoyment of the property. If a broker or
salesperson who is working with a Buyer as a customer and
is representing the Seller and to whom any information is
disclosed, he or she must act in the Seller's interests
best interest and must tell the Seller the any information
disclosed to him or her, except confidential information
acquired in a facilitator relationship (see paragraph V
below). In that case, the Buyer will not be represented
and will not receive advice and counsel from the broker or
salesperson.
II.
Subagent: A broker or salesperson who is working with a
Buyer but represents the Seller. In this case, the Buyer
is the broker's customer and is not represented by that
broker. If a broker or salesperson working with a Buyer as
a customer is representing the Seller, he or she must act
in the Seller's best interest and must tell the Seller any
information that is disclosed to him or her. In that case,
the Buyer will not be represented and will not receive
advice and counsel from the broker or salesperson.
III.
Buyer's Broker: A Buyer may enter into an agreement for
the broker or salesperson to represent and act on behalf of
the Buyer. The broker may represent the Buyer only, and
not the Seller, even if the broker he or she is being paid
in whole or in part by the Seller. A Buyer's broker owes
to the Buyer the fiduciary duties described below.(2) The
broker must disclose to the Buyer any material facts as
defined in Minnesota Statutes, section 82.197, subdivision
6, of which the broker is aware that could adversely and
significantly affect the Buyer's use or enjoyment of the
property. If a broker or salesperson working with a Seller
as a customer is representing the Buyer, he or she must act
in the Buyer's best interest and must tell the Buyer any
information disclosed to him or her, except confidential
information acquired in a facilitator relationship (see
paragraph V below). In that case, the Seller will not be
represented and will not receive advice and counsel from
the broker or salesperson.
III. IV.
Dual Agency-Broker Representing both Seller and Buyer:
Dual agency occurs when one broker or salesperson
represents both parties to a transaction, or when two
salespersons licensed to the same broker each represent a
party to the transaction. Dual agency requires the
informed consent of all parties, and means that the broker
and salesperson owe the same duties to the Seller and the
Buyer. This role limits the level of representation the
broker and salespersons can provide, and prohibits them
from acting exclusively for either party. In a dual
agency, confidential information about price, terms, and
motivation for pursuing a transaction will be kept
confidential unless one party instructs the broker or
salesperson in writing to disclose specific information
about the party writing him or her. Other information will
be shared. Dual agents may not advocate for one party to
the detriment of the other.(3)
Within the limitations described above, dual agents owe to
both Seller and Buyer the fiduciary duties described
below.(2) Dual agents must disclose to Buyers any material
facts as defined in Minnesota Statutes, section 82.197,
subdivision 6, of which the broker is aware that could
adversely and significantly affect the Buyer's use or
enjoyment of the property.
IV. V.
Nonagent Facilitator: A broker or salesperson may perform
who performs services for either party as a nonagent, if
that party signs a nonagency services agreement a Buyer, a
Seller, or both but does not represent either in a
fiduciary capacity as a Buyer's Broker, Seller's Broker, or
Dual Agent. As a nonagent the broker or salesperson
facilitates the transaction, but does not act on behalf of
either party. THE NONAGENT FACILITATOR BROKER OR
SALESPERSON DOES NOT OWE ANY PARTY ANY OF THE FIDUCIARY
DUTIES LISTED BELOW, EXCEPT CONFIDENTIALITY, UNLESS THOSE
DUTIES ARE INCLUDED IN THE WRITTEN NONAGENCY FACILITATOR
SERVICES AGREEMENT. The nonagent facilitator broker or
salesperson owes only the duty of confidentiality to the
party but owes no other duty to the party except those
duties required by law or contained in the a written
nonagency facilitator services agreement, if any. In the
event a facilitator broker or salesperson, working with a
Buyer, shows a property listed by the facilitator broker or
salesperson, then the facilitator broker or salesperson
must act as a Seller's Broker (see paragraph I above). In
the event a facilitator broker or salesperson, working with
a Seller, accepts a showing of the property by a Buyer
being represented by the facilitator broker or salesperson,
then the facilitator broker or salesperson must act as a
Buyer's Broker (see paragraph III above).
ACKNOWLEDGMENT: I/We acknowledge that I/We have been presented
with the above-described options. I/We understand that Buyers
who have not signed a Buyer representation contract or nonagency
services agreement are not represented by the broker/salesperson
and information given to the broker/salesperson will be
disclosed to the Seller. I/We understand that written consent
is required for a dual agency relationship. This is a
disclosure only, NOT a contract for representation.
......................... ........................
Seller Date Buyer Date
......................... ........................
Seller Date Buyer Date
****************************************************************
(1) This disclosure is required by law in any transaction
involving property occupied or intended to be occupied by one to
four families as their residence.
(2) The fiduciary duties mentioned above are listed below
and have the following meanings:
Loyalty-broker/salesperson will act only in client(s)' best
interest.
Obedience-broker/salesperson will carry out all client(s)'
lawful instructions.
Disclosure-broker/salesperson will disclose to client(s)
all material facts of which broker/salesperson has knowledge
which might reasonably affect the client's rights and interests.
Confidentiality-broker/salesperson will keep client(s)'
confidences unless required by law to disclose specific
information (such as disclosure of material facts to Buyers).
Reasonable Care-broker/salesperson will use reasonable care
in performing duties as an agent.
Accounting-broker/salesperson will account to client(s) for
all client(s)' money and property received as agent.
(3) If Seller(s) decides not to agree to a dual agency
relationship, Seller(s) may give up the opportunity to sell the
property to Buyers represented by the broker/salesperson. If
Buyer(s) decides not to agree to a dual agency relationship,
Buyer(s) may give up the opportunity to purchase properties
listed by the broker.
Sec. 13. Minnesota Statutes 2000, section 82.197, is
amended by adding a subdivision to read:
Subd. 6. [MATERIAL FACTS.] (a) Licensees shall disclose to
any prospective purchaser all material facts of which the
licensees are aware, which could adversely and significantly
affect an ordinary purchaser's use or enjoyment of the property,
or any intended use of the property of which the licensees are
aware.
(b) It is not a material fact relating to real property
offered for sale and no regulatory action shall be brought
against a licensee for failure to disclose in any real estate
transaction the fact or suspicion that the property:
(1) is or was occupied by an owner or occupant who is or
was suspected to be infected with human immunodeficiency virus
or diagnosed with acquired immunodeficiency syndrome; or
(2) was the site of an accidental death, natural death, or
perceived paranormal activity.
(c) A licensee or employee of the licensee has no duty to
disclose information regarding an offender who is required to
register under section 243.166, or about whom notification is
made under that section, if the broker or salesperson, in a
timely manner, provides a written notice that information about
the predatory offender registry and persons registered with the
registry may be obtained by contacting local law enforcement
where the property is located or the department of corrections.
(d) A licensee is not required to disclose, except as
otherwise provided in paragraph (e), information relating to the
physical condition of the property or any other information
relating to the real estate transaction, if a written report
that discloses the information has been prepared by a qualified
third party and provided to the person. For the purposes of
this paragraph, "qualified third party" means a federal, state,
or local governmental agency, or any person whom the broker,
salesperson, or a party to the real estate transaction
reasonably believes has the expertise necessary to meet the
industry standards of practice for the type of inspection or
investigation that has been conducted by the third party in
order to prepare the written report and who is acceptable to the
person to whom the disclosure is being made.
(e) A licensee shall disclose to the parties to a real
estate transaction any facts known by the broker or salesperson
that contradict any information included in a written report, if
a copy of the report is provided to the licensee, described in
paragraph (d).
Sec. 14. Minnesota Statutes 2000, section 82.22,
subdivision 13, is amended to read:
Subd. 13. [CONTINUING EDUCATION.] (a) After their first
renewal date, all real estate salespersons and all real estate
brokers shall be required to successfully complete 30 hours of
real estate continuing education, either as a student or a
lecturer, in courses of study approved by the commissioner,
during each 24-month license period. At least 15 of the 30
credit hours must be completed during the first 12 months of the
24-month licensing period. Salespersons and brokers whose
initial license period extends more than 12 months are required
to complete 15 hours of real estate continuing education during
the initial license period. Those licensees who will receive a
12-month license on July 1, 1995, because of the staggered
implementation schedule must complete 15 hours of real estate
continuing education as a requirement for renewal on July 1,
1996. Licensees may not claim credit for continuing education
not actually completed as of the date their report of continuing
education compliance is filed.
(b) The commissioner shall adopt rules defining the
standards for course and instructor approval, and may adopt
rules for the proper administration of this subdivision. The
commissioner may not approve a course which can be completed by
the student at home or outside the classroom without the
supervision of an instructor approved by the department of
commerce. The commissioner has discretion to establish a pilot
program to explore delivery of except accredited courses using
new delivery technology, including interactive technology, and
the Internet. This pilot program expires on August 1,
2001. Courses in motivation, salesmanship, psychology, or time
management shall not be approved by the commissioner for
continuing education credit.
(c) Any program approved by Minnesota continuing legal
education shall be approved by the commissioner of commerce for
continuing education for real estate brokers and salespeople if
the program or any part thereof relates to real estate.
(d) As part of the continuing education requirements of
this section, the commissioner shall require that all real
estate brokers and salespersons receive:
(1) at least two hours one hour of training during each
license period in courses in laws or regulations on agency
representation and disclosure; and
(2) at least two hours one hour of training during each
license period in courses in state and federal fair housing
laws, regulations, and rules, or other antidiscrimination laws,
or courses designed to help licensees to meet the housing needs
of immigrant and other underserved populations.
Clause Clauses (1) does and (2) do not apply to real estate
salespersons and real estate brokers engaged solely in the
commercial real estate business who file with the commissioner a
verification of this status along with the continuing education
report required under paragraph (a).
(e) The commissioner is authorized to establish a procedure
for renewal of course accreditation.
(f) Approved courses may be sponsored or offered by a
broker of a real estate company and may be held on the premises
of a company licensed under this chapter. All course offerings
must be open to any interested individuals. Access may be
restricted by the sponsor based on class size only. Courses
must not be approved if attendance is restricted to any
particular group of people. A broker must comply with all
continuing education rules prescribed by the commissioner.
(g) No more than one-half of the credit hours per licensing
period, including continuing education required under
subdivision 6, may be credited to a person for attending any
combination of courses either:
(1) sponsored by, offered by, or affiliated with a real
estate company or its agents; or
(2) offered using new delivery technology, including
interactive technology, and the Internet.
Sec. 15. Minnesota Statutes 2000, section 82.24,
subdivision 8, is amended to read:
Subd. 8. [ACCRUED INTEREST.] (a) Each broker shall
maintain a pooled interest-bearing trust account for deposit of
client funds. The interest accruing on the trust account, less
reasonable transaction costs, must be paid to the state
treasurer for deposit in the housing trust fund account created
under section 462A.201 unless otherwise specified pursuant to an
expressed written agreement between the parties to a transaction.
(b) For an account created under paragraph (a), each broker
shall direct the financial institution to:
(1) pay the interest, less reasonable transaction costs,
computed in accordance with the financial institution's standard
accounting practice, at least quarterly, to the state treasurer;
and
(2) send a statement to the state treasurer showing the
name of the broker for whom the payment is made, the rate of
interest applied, the amount of service charges deducted, and
the account balance for the period in which the report is made.
The state treasurer shall credit the amount collected under
this subdivision to the housing trust fund account established
in section 462A.201.
(c) The financial institution must promptly notify the
commissioner if a draft drawn on the account is dishonored. A
draft is not dishonored if a stop payment order is requested by
an issuer who has a good faith defense to payment on the draft.
Sec. 16. Minnesota Statutes 2000, section 82.27,
subdivision 3, is amended to read:
Subd. 3. [ORDER TO SHOW CAUSE.] The commissioner shall
issue an order requiring a licensee or applicant for a license
to show cause why the license should not be revoked or
suspended, or the licensee censured, or the application denied.
The order shall be calculated to give reasonable notice of the
time and place for hearing thereon, and shall state the reasons
specific statute or rule that has been violated for the entry of
the order. The commissioner may by order summarily suspend a
license pending final determination of any order to show cause.
If a license is suspended pending final determination of an
order to show cause, a hearing on the merits shall be held
within 30 days of the issuance of the order of suspension. All
hearings shall be conducted in accordance with the provisions of
chapter 14. After the hearing, the commissioner shall enter an
order making such disposition of the matter as the facts
require. If the licensee or applicant fails to appear at a
hearing after having been duly notified of it, such person shall
be deemed in default, and the proceeding may be determined
against the licensee or applicant upon consideration of the
order to show cause, the allegations of which may be deemed to
be true.
Sec. 17. Minnesota Statutes 2000, section 82.34, is
amended by adding a subdivision to read:
Subd. 7a. [ACCELERATED CLAIMS PAYMENT.] (a) The
commissioner shall pay claims from the recovery portion of the
fund that do not exceed the jurisdiction limits for conciliation
court matters as specified in section 491A.01 on an accelerated
basis if all of the requirements in subdivision 7 and paragraphs
(b) to (f) have been satisfied.
(b) When any aggrieved person as defined in subdivision 7
obtains a judgment in any court of competent jurisdiction,
regardless of whether the judgment has been discharged by a
bankruptcy court against a licensee on grounds specified in
subdivision 7, the aggrieved person may file a verified
application with the commissioner for payment out of the
recovery portion of the fund of the amount of actual and direct
out-of-pocket loss in the transaction, but excluding any
attorney fees, interest on the loss, and on any judgment
obtained as a result of the loss, up to the conciliation court
jurisdiction limits, of the amount unpaid upon the judgment.
For purposes of this section, persons who are joint tenants or
tenants in common are deemed to be a single claimant.
(c) The commissioner shall send the licensee a copy of the
verified application by first-class mail to the licensee's
address as it appears in the records of the department of
commerce with a notice that the claim will be paid 15 days from
the date of the notice unless the licensee notifies the
commissioner before that date of the commencement of an appeal
of the judgment, if the time for appeal has not expired, and
that payment of the claim will result in automatic suspension of
the licensee's license.
(d) If the licensee does not notify the commissioner of the
commencement of an appeal, the commissioner shall pay the claim
at the end of the 15-day period.
(e) If an appeal is commenced, the payment of the claim is
stayed until the conclusion of the appeal.
(f) The commissioner may pay claims which total no more
than $50,000 against the licensee under this accelerated
process. The commissioner may prorate the amount of claims paid
under this subdivision if claims in excess of $50,000 against
the licensee are submitted. Any unpaid portions of these claims
must be satisfied in the manner set forth in subdivision 7.
Sec. 18. Minnesota Statutes 2000, section 82.34,
subdivision 15, is amended to read:
Subd. 15. Any sums received by the commissioner pursuant
to any provisions of this section shall be deposited in the
state treasury, and credited to the real estate education,
research and recovery fund, and said sums shall be allocated
exclusively for the purposes provided in this section. All
moneys in the fund are appropriated annually to the commissioner
for the purposes of this section.
All money credited to the fund under section 462A.201 may
only be used for purposes under subdivision 6, clause (g).
Beginning in 1990, the commissioner must, on February 1 of each
year, review the amount of money spent or allocated for uses
under subdivision 6, clause (g), for the previous calendar
year. If the amount spent or allocated is less than the amount
credited to the fund under section 462A.201 during the same
calendar year, the difference must be transferred from the fund
to the housing trust fund account established in section
462A.201. If the fund balance exceeds $4,000,000, the
commissioner may suspend the fee imposed under subdivision 3.
Sec. 19. Minnesota Statutes 2000, section 82B.14, is
amended to read:
82B.14 [EXPERIENCE REQUIREMENT.]
(a) As a prerequisite for licensing as a registered real
property appraiser or licensed real property appraiser, an
applicant must present evidence satisfactory to the commissioner
that the person has obtained 2,000 hours of experience in real
property appraisal.
As a prerequisite for licensing as a certified residential
real property appraiser, an applicant must present evidence
satisfactory to the commissioner that the person has obtained
2,500 hours of experience in real property appraisal.
As a prerequisite for licensing as a certified general real
property appraiser, an applicant must present evidence
satisfactory to the commissioner that the person has obtained
3,000 hours of experience in real property appraisal. At least
50 percent, or 1,500 hours, must be in nonresidential appraisal
work.
(b) Each applicant for license under section 82B.11,
subdivision 3, 4, or 5, shall give under oath a detailed listing
of the real estate appraisal reports or file memoranda for which
experience is claimed by the applicant. Upon request, the
applicant shall make available to the commissioner for
examination, a sample of appraisal reports that the applicant
has prepared in the course of appraisal practice.
(c) Applicants may not receive credit for experience
accumulated while unlicensed, if the experience is based on
activities which required a license under this section.
Sec. 20. Minnesota Statutes 2000, section 83.25,
subdivision 1, is amended to read:
Subdivision 1. No person shall offer or sell in this state
any interest in subdivided lands without having obtained:
(1) a license under chapter 82; and
(2) an additional license to offer or dispose of subdivided
lands. This license may be obtained by submitting an
application in writing to the commissioner upon forms prepared
and furnished by the commissioner. Each application shall be
signed and sworn to by the applicant and accompanied by a
license fee of $10 per year. The commissioner may also require
an additional examination for this license. This clause expires
July 1, 2003.
Sec. 21. Minnesota Statutes 2000, section 317A.203, is
amended to read:
317A.203 [NUMBER.]
A board of directors must consist of three or more
individuals, with the number specified in or fixed in accordance
with the articles or bylaws, except that if the corporation has
either one or two members with voting rights, the number of
directors may be less than three but not less than the number of
members with voting rights.
Sec. 22. Minnesota Statutes 2000, section 326.91,
subdivision 1, is amended to read:
Subdivision 1. [CAUSE.] The commissioner may by order
deny, suspend, or revoke any license or may censure a licensee,
and may impose a civil penalty as provided for in section
45.027, subdivision 6, if the commissioner finds that the order
is in the public interest, and that the applicant, licensee, or
affiliate of an applicant or licensee, or other agent, owner,
partner, director, governor, shareholder, member, officer,
qualifying person, or managing employee of the applicant or
licensee or any person occupying a similar status or performing
similar functions:
(1) has filed an application for a license which is
incomplete in any material respect or contains any statement
which, in light of the circumstances under which it is made, is
false or misleading with respect to any material fact;
(2) has engaged in a fraudulent, deceptive, or dishonest
practice;
(3) is permanently or temporarily enjoined by any court of
competent jurisdiction from engaging in or continuing any
conduct or practice involving any aspect of the business;
(4) has failed to reasonably supervise employees, agents,
subcontractors, or salespersons, or has performed negligently or
in breach of contract, so as to cause injury or harm to the
public;
(5) has violated or failed to comply with any provision of
sections 326.83 to 326.98 or any rule or order under sections
326.83 to 326.98;
(6) has been shown to be incompetent, untrustworthy, or
financially irresponsible;
(7) has been convicted of a violation of the State Building
Code or, in jurisdictions that do not enforce the State Building
Code, has refused to correct a violation of the State Building
Code when the violation has been certified by a Minnesota
licensed structural engineer;
(8) has failed to use the proceeds of any payment made to
the licensee for the construction of, or any improvement to,
residential real estate, as defined in section 326.83,
subdivision 17, for the payment of labor, skill, material, and
machinery contributed to the construction or improvement,
knowing that the cost of any labor performed, or skill,
material, or machinery furnished for the improvement remains
unpaid;
(9) has not furnished to the person making payment either a
valid lien waiver as to any unpaid labor performed, or skill,
material, or machinery furnished for an improvement, or a
payment bond in the basic amount of the contract price for the
improvement conditioned for the prompt payment to any person or
persons entitled to payment;
(10) has engaged in conduct which was the basis for a
contractor's recovery fund payment pursuant to section 326.975,
which payment has not been reimbursed;
(11) has engaged in bad faith, unreasonable delays, or
frivolous claims in defense of a civil lawsuit arising out of
their activities as a licensee under this chapter;
(12) has had a judgment entered against them for failure to
make payments to employees or subcontractors, and all appeals of
the judgment have been exhausted or the period for appeal has
expired;
(13) if unlicensed, has obtained a building permit by the
fraudulent use of a fictitious license number or the license
number of another, or, if licensed, has knowingly allowed an
unlicensed person to use the licensee's license number for the
purpose of fraudulently obtaining a building permit; or
(14) has made use of forged mechanics' lien waivers under
chapter 514.
Sec. 23. Minnesota Statutes 2000, section 326.975,
subdivision 1, is amended to read:
Subdivision 1. [GENERALLY.] (a) In addition to any other
fees, each applicant for a license under sections 326.83 to
326.98 shall pay a fee to the contractor's recovery fund. The
contractor's recovery fund is created in the state treasury and
must be administered by the commissioner in the manner and
subject to all the requirements and limitations provided by
section 82.34 with the following exceptions:
(1) each licensee who renews a license shall pay in
addition to the appropriate renewal fee an additional fee which
shall be credited to the contractor's recovery fund. The amount
of the fee shall be based on the licensee's gross annual
receipts for the licensee's most recent fiscal year preceding
the renewal, on the following scale:
Fee Gross Receipts
$100 under $1,000,000
$150 $1,000,000 to $5,000,000
$200 over $5,000,000
Any person who receives a new license shall pay a fee based on
the same scale;
(2) the sole purpose of this fund is to compensate any
aggrieved owner or lessee of residential property located within
this state who obtains a final judgment in any court of
competent jurisdiction against a licensee licensed under section
326.84, on grounds of fraudulent, deceptive, or dishonest
practices, conversion of funds, or failure of performance
arising directly out of any transaction when the judgment debtor
was licensed and performed any of the activities enumerated
under section 326.83, subdivision 19, on the owner's residential
property or on residential property rented by the lessee, or on
new residential construction which was never occupied prior to
purchase by the owner, or which was occupied by the licensee for
less than one year prior to purchase by the owner, and which
cause of action arose on or after April 1, 1994;
(3) nothing may obligate the fund for more than $50,000 per
claimant, nor more than $50,000 $75,000 per licensee; and
(4) nothing may obligate the fund for claims based on a
cause of action that arose before the licensee paid the recovery
fund fee set in clause (1), or as provided in section 326.945,
subdivision 3.
(b) Should the commissioner pay from the contractor's
recovery fund any amount in settlement of a claim or toward
satisfaction of a judgment against a licensee, the license shall
be automatically suspended upon the effective date of an order
by the court authorizing payment from the fund. No licensee
shall be granted reinstatement until the licensee has repaid in
full, plus interest at the rate of 12 percent a year, twice the
amount paid from the fund on the licensee's account, and has
obtained a surety bond issued by an insurer authorized to
transact business in this state in the amount of at least
$40,000.
Sec. 24. Minnesota Statutes 2000, section 332.41, is
amended to read:
332.41 [APPEALS.]
Subdivision 1. [FILING OF APPEAL.] In the rejection of an
application for a license or the renewal thereof filed under
sections 332.31 to 332.45 or of the suspension or revocation of
a license granted under sections 332.31 to 332.45 the applicant
or licensee may within 90 days after receipt of notice of such
rejection, suspension, or revocation, file an appeal and
thereafter prosecute the appeal in accordance with the
provisions of the statutes governing appeal from, or review of,
decisions of administrative agencies in this state.
Subd. 2. [SUPERSEDEAS.] The filing of an appeal from an
order of the commissioner of commerce rejecting an application
for a license by a collection agency engaged in business as of
July 1, 1969, or rejecting an application for the renewal of a
license, or suspending or revoking a license within 60 days
after the date of such order, shall operate as a supersedeas
which shall continue pending final determination of such appeal.
Appeal from a denial, suspension, revocation, or censure of
a license must be made according to chapter 14.
Sec. 25. Minnesota Statutes 2000, section 359.02, is
amended to read:
359.02 [TERM.]
A notary commissioned under section 359.01 holds office for
five years, unless sooner removed by the governor or the
district court, or by action of the commissioner. Within seven
months 60 days before the expiration of the commission a notary
may be reappointed apply for reappointment for a new term to
commence and to be designated in the new commission as beginning
upon the day immediately following the date of the
expiration. A notary whose commission expires on January 1,
2005, may apply for reappointment six months before the
expiration date. The reappointment takes effect and is valid
although the appointing governor may not be in the office of
governor on the effective day.
(a) All notary commissions issued before January 31, 1995,
will expire on January 31, 1995.
(b) All notary commissions issued after January 31, 1995,
will expire at the end of the licensing period, which will end
every fifth year following January 31, 1995.
(c) All notary commissions issued during a licensing period
expire at the end of that period as set forth in this
section expire on January 31 of the fifth year following the
year of issue.
Sec. 26. Minnesota Statutes 2000, section 507.45,
subdivision 3, is amended to read:
Subd. 3. [REQUIREMENTS FOR REAL ESTATE PERSONNEL.] If the
closing services are to be provided by a real estate broker,
real estate salesperson, or real estate closing agent, the
following regulations shall apply.
(a) The written contract for closing services shall state
in at least 10-point type that the real estate broker, real
estate salesperson, or real estate closing agent has not and,
under applicable state law, may not express opinions regarding
the legal effect of the closing documents or of the closing
itself.
(b) No closing fee may be charged in connection with the
transfer of the legal or equitable ownership of a property if a
closing is performed without either a mortgagee's or owner's
title insurance commitment or a legal opinion regarding the
status of title.
Sec. 27. [STUDY; FAIR HOUSING TRAINING.]
The commissioner of commerce shall examine the issue of
whether licensed occupations under the jurisdiction of the
department and related to the purchase or financing of
residential housing, including, but not limited to, appraisers,
and employees of licensed mortgage originators and servicers,
should be required to attend continuing education courses in
state and federal fair housing law, and other antidiscrimination
laws, in order to further consumer protection. The commissioner
shall report the results of the examination to the commerce
committees of the legislature by February 1, 2002.
Sec. 28. [APPROPRIATION.]
Up to $1,000,000 is appropriated from the real estate
education, research, and recovery fund established under
Minnesota Statutes, section 82.34, to the department of commerce
for an educational campaign aimed at fair housing and
housing-related antidiscrimination initiatives. The
appropriation must be used for educating real estate licensees
and for a public information campaign across the state on
consumer's rights under current fair housing laws. The
educational campaign may include, but is not limited to,
television and radio advertisements and printed material. The
materials used for the public information campaign may be
prepared in multiple languages if necessary.
Sec. 29. [EFFECTIVE DATE.]
Sections 1 to 8, 13, 19, and 26 are effective the day
following final enactment. Section 14 is effective July 1, 2001.
Section 21 is effective July 1, 2001, and applies to nonprofit
corporations formed on or after that date. Section 23 is
effective January 1, 2001, and applies to claims arising from
incidents or conduct occurring on or after that date.
Presented to the governor May 25, 2001
Signed by the governor May 29, 2001, 11:28 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes