REPRESENTATIVES G. Smith, Williams, Cates, Clancy, Kilbane, Collier, Husted, Goodman, Evans, Flowers, Blasdel, Carmichael, Schaffer, Schmidt, Seitz, Lendrum, Brinkman, Olman, Carano, Rhine

To amend sections 4735.01, 4735.02, 4735.10, 4735.12,

1

4735.14, and 4735.18 and to enact section 4735.022

2

of the Revised Code to allow a real estate broker

3

licensed in another state to transact business on

4

commercial property in Ohio in cooperation with an

5

Ohio licensed real estate broker and to implement

6

a three-year license and renewal system for real

7

estate salespersons and brokers not later than

8

January 1, 2005.

9

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 4735.01, 4735.02, 4735.10, 4735.12,	10
4735.14, and 4735.18 be amended and section 4735.022 of the	11
Revised Code be enacted to read as follows:	12

Sec. 4735.01.  As used in this chapter:

13

(A) "Real estate broker" includes any person, partnership,	14
association, limited liability company, limited liability	15
partnership, or corporation, foreign or domestic, who for another,	16
whether pursuant to a power of attorney or otherwise, and who for	17
a fee, commission, or other valuable consideration, or with the	18
intention, or in the expectation, or upon the promise of receiving	19
or collecting a fee, commission, or other valuable consideration	20
does any of the following:	21

(1) Sells, exchanges, purchases, rents, or leases, or	22
negotiates the sale, exchange, purchase, rental, or leasing of any	23
real estate;	24

(2) Offers, attempts, or agrees to negotiate the sale,	25
exchange, purchase, rental, or leasing of any real estate;	26

(3) Lists, or offers, attempts, or agrees to list, or	27
auctions, or offers, attempts, or agrees to auction, any real	28
estate;	29

(4) Buys or offers to buy, sells or offers to sell, or	30
otherwise deals in options on real estate;	31

(5) Operates, manages, or rents, or offers or attempts to	32
operate, manage, or rent, other than as custodian, caretaker, or	33
janitor, any building or portions of buildings to the public as	34
tenants;	35

(6) Advertises or holds self out as engaged in the business	36
of selling, exchanging, purchasing, renting, or leasing real	37
estate;	38

(7) Directs or assists in the procuring of prospects or the	39
negotiation of any transaction, other than mortgage financing,	40
which does or is calculated to result in the sale, exchange,	41
leasing, or renting of any real estate;	42

(8) Is engaged in the business of charging an advance fee or	43
contracting for collection of a fee in connection with any	44
contract whereby the broker undertakes primarily to promote the	45
sale, exchange, purchase, rental, or leasing of real estate	46
through its listing in a publication issued primarily for such	47
purpose, or for referral of information concerning such real	48
estate to brokers, or both, except that this division does not	49
apply to a publisher of listings or compilations of sales of real	50
estate by their owners;	51

(9) Collects rental information for purposes of referring	52
prospective tenants to rental units or locations of such units and	53
charges the prospective tenants a fee.	54

(B) "Real estate" includes leaseholds as well as any and	55
every interest or estate in land situated in this state, whether	56
corporeal or incorporeal, whether freehold or nonfreehold, and the	57
improvements on the land, but does not include cemetery interment	58
rights.	59

(C) "Real estate salesperson" means any person associated	60
with a licensed real estate broker to do or to deal in any acts or	61
transactions set out or comprehended by the definition of a real	62
estate broker, for compensation or otherwise.	63

(D) "Institution of higher education" means either of the	64
following:	65

(1) A nonprofit institution as defined in section 1713.01 of	66
the Revised Code that actually awards, rather than intends to	67
award, degrees for fulfilling requirements of academic work beyond	68
high school;	69

(2) An institution operated for profit that otherwise	70
qualifies under the definition of an institution in section	71
1713.01 of the Revised Code and that actually awards, rather than	72
intends to award, degrees for fulfilling requirements of academic	73
work beyond high school.	74

(E) "Foreign real estate" means real estate not situated in	75
this state and any interest in real estate not situated in this	76
state.	77

(F) "Foreign real estate dealer" includes any person,	78
partnership, association, limited liability company, limited	79
liability partnership, or corporation, foreign or domestic, who	80
for another, whether pursuant to a power of attorney or otherwise,	81
and who for a fee, commission, or other valuable consideration, or	82
with the intention, or in the expectation, or upon the promise of	83
receiving or collecting a fee, commission, or other valuable	84
consideration, does or deals in any act or transaction specified	85
or comprehended in division (A) of this section with respect to	86
foreign real estate.	87

(G) "Foreign real estate salesperson" means any person	88
associated with a licensed foreign real estate dealer to do or	89
deal in any act or transaction specified or comprehended in	90
division (A) of this section with respect to foreign real estate,	91
for compensation or otherwise.	92

(H) Any person, partnership, association, limited liability	93
company, limited liability partnership, or corporation, who, for	94
another, in consideration of compensation, by fee, commission,	95
salary, or otherwise, or with the intention, in the expectation,	96
or upon the promise of receiving or collecting a fee, does, or	97
offers, attempts, or agrees to engage in, any single act or	98
transaction contained in the definition of a real estate broker,	99
whether an act is an incidental part of a transaction, or the	100
entire transaction, shall be constituted a real estate broker or	101
real estate salesperson under this chapter.	102

(I) The terms "real estate broker," "real estate	103
salesperson," "foreign real estate dealer," and "foreign real	104
estate salesperson" do not include a person, partnership,	105
association, limited liability company, limited liability	106
partnership, or corporation, or the regular employees thereof, who	107
perform any of the acts or transactions specified or comprehended	108
in division (A) of this section, whether or not for, or with the	109
intention, in expectation, or upon the promise of receiving or	110
collecting a fee, commission, or other valuable consideration:	111

(1) With reference to real estate situated in this state or	112
any interest in it owned by such person, partnership, association,	113
limited liability company, limited liability partnership, or	114
corporation, or acquired on its own account in the regular course	115
of, or as an incident to the management of the property and the	116
investment in it;	117

(2) As receiver or trustee in bankruptcy, as guardian,	118
executor, administrator, trustee, assignee, commissioner, or any	119
person doing the things mentioned in this section, under authority	120
or appointment of, or incident to a proceeding in, any court, or	121
as a public officer, or as executor, trustee, or other bona fide	122
fiduciary under any trust agreement, deed of trust, will, or other	123
instrument creating a like bona fide fiduciary obligation;	124

(3) As a public officer while performing the officer's	125
official duties;	126

(4) As an attorney at law in the performance of the	127
attorney's duties;	128

(5) As a person who engages in the brokering of the sale of	129
business assets, not including the negotiation of the sale, lease,	130
exchange, or assignment of any interest in real estate;	131

(6) As a person who enages in the sale of manufactured homes	132
as defined in division (C)(4) of section 3781.06 of the Revised	133
Code, or of mobile homes as defined in division (O) of section	134
4501.01 of the Revised Code, provided the sale does not include	135
the negotiation, sale, lease, exchange, or assignment of any	136
interest in real estate;	137

(7) As a person who engages in the sale of commercial real	138
estate as defined in division (R) of this section pursuant to the	139
requirements of section 4735.022 of the Revised Code.	140

(J) "Physically handicapped licensee" means a person	141
licensed pursuant to this chapter who is under a severe physical	142
disability which is of such a nature as to prevent the person from	143
being able to attend any instruction lasting at least three hours	144
in duration.	145

(K) "Division of real estate" may be used interchangeably	146
with, and for all purposes has the same meaning as, "division of	147
real estate and professional licensing."	148

(L) "Superintendent" or "superintendent of real estate"	149
means the superintendent of the division of real estate and	150
professional licensing of this state. Whenever the division or	151
superintendent of real estate is referred to or designated in any	152
statute, rule, contract, or other document, the reference or	153
designation shall be deemed to refer to the division or	154
superintendent of real estate and professional licensing, as the	155
case may be.	156

(M) "Inactive license" means the license status in which a	157
salesperson's license is in the possession of the division,	158
annually renewed as required under this chapter, and not	159
associated with a real estate broker.	160

(N) "Broker's license on deposit" means the license status	161
in which a broker's license is in the possession of the division	162
of real estate and professional licensing and annually renewed as	163
required under this chapter.	164

(O) "Suspended license" means the license status that	165
prohibits a licensee from providing services that require a	166
license under this chapter for a specified interval of time.	167

(P) "Reactivate" means the process prescribed by the	168
superintendent of real estate and professional licensing to remove	169
a license from an inactive, suspended, or broker's license on	170
deposit status to allow a licensee to provide services that	171
require a license under this chapter.	172

(Q) "Revoked" means the license status in which the license	173
is void and not eligible for reactivation.	174

(R) "Commercial real estate" means any parcel of real estate	175
in this state other than real estate containing one to four	176
residential units. "Commercial real estate" does not include	177
single-family residential units such as condominiums, townhouses,	178
manufactured homes, or homes in a subdivision when sold, leased,	179
or otherwise conveyed on a unit-by-unit basis, even when those	180
units are a part of a larger building or parcel of real estate	181
containing more than four residential units.	182

(S) "Out of state commercial broker" includes any person,	183
partnership, association, limited liability company, limited	184
liability partnership, or corporation that is licensed to do	185
business as a real estate broker in a jurisdiction other than	186
Ohio.	187

(T) "Out of state commercial salesperson" includes any	188
person affiliated with an out of state commercial broker who is	189
not licensed as a real estate salesperson in Ohio.	190

Sec. 4735.02.  No Except as provided in section 4735.022 of	191
the Revised Code, no person, partnership, association, limited	192
liability company, limited liability partnership, or corporation	193
shall act as a real estate broker or real estate salesperson, or	194
advertise or assume to act as such, without first being licensed	195
as provided in this chapter. No person, partnership, association,	196
limited liability company, limited liability partnership, or	197
corporation shall provide services that require a license under	198
this chapter if the licensee's license is inactive, suspended, or	199
a broker's license on deposit, or if the license has been revoked.	200
Nothing contained in this chapter shall be construed as	201
authorizing a real estate broker or salesperson to perform any	202
service constituting the practice of law.	203

No partnership, association, limited liability company,	204
limited liability partnership, or corporation holding a real	205
estate license shall employ as an officer, director, manager, or	206
principal employee any person previously holding a license as a	207
real estate broker, real estate salesperson, foreign real estate	208
dealer, or foreign real estate salesperson, whose license has been	209
placed in inactive status, suspended, or revoked and who has not	210
thereafter reactivated the license or received a new license.	211

Sec. 4735.022. (A) An out of state commercial broker, for a	212
fee, commission, or other valuable consideration, or in the	213
expectation, or upon the promise of receiving or collecting a fee,	214
commission, or other valuable consideration, may perform those	215
acts that require a license under this chapter, with respect to	216
commercial real estate, provided that the out of state commercial	217
broker does all of the following:	218

(1) Works in cooperation with real estate broker who holds a	219
valid, active license issued under this chapter;	220

(2) Enters into a written agreement with the Ohio real	221
estate broker that includes the terms of cooperation and	222
compensation and a statement that the out of state commercial	223
broker and its agents will agree to adhere to the laws of Ohio;	224

(3) Furnishes the Ohio real estate broker with a copy of	225
the out of state commercial broker's current certificate of good	226
standing from any jurisdiction where the out of state commercial	227
broker maintains an active real estate license;	228

(4) Files an irrevocable written consent with the Ohio real	229
estate broker that legal actions arising out of the conduct of the	230
out of state commercial broker or its agents may be commenced	231
against the out of state commercial broker in the court of proper	232
jurisdiction of any county in Ohio where the cause of action	233
arises or where the plaintiff resides;	234

(5) Includes the name of the Ohio real estate broker on all	235
advertising in accordance with section 4735.16 of the Revised	236
Code;	237

(6) Deposits all escrow funds, security deposits, and other	238
money received by either the out of state commercial broker or	239
Ohio real estate broker in accordance with the account	240
specifications set forth in divisions (A)(26) and (27) of section	241
4735.18 of the Revised Code in accounts maintained by the Ohio	242
real estate broker;	243

(7) Deposits all documentation required by this section and	244
records and documents related to the transaction with the Ohio	245
real estate broker who maintains those documents and records in	246
accordance with the requirements set forth in division (A)(24) of	247
section 4735.18 of the Revised Code.	248

(B) An out of state commercial salesperson may perform	249
those acts that require a real estate salesperson license under	250
this chapter with respect to commercial real estate, provided that	251
the out of state commercial salesperson meets all of the following	252
requirements:	253

(1) Is licensed with and works under the direct supervision	254
of the out of state commercial broker;	255

(2) The out of state commercial broker with whom the	256
salesperson is associated meets all of the requirements of	257
division (A) of this section;	258

(3) Provides the Ohio real estate broker with a copy of the	259
commercial salesperson's current certificate of good standing from	260
the jurisdiction where the out of state commercial salesperson	261
maintains an active real estate license in connection with the out	262
of state commercial broker;	263

(4) Only collects money, including commissions, deposits,	264
payments, rentals, or otherwise, in the name of and with the	265
consent of the out of state commercial broker under whom the out	266
of state commercial salesperson is licensed.	267

(C) By filing a consent-to-jurisdiction document as	268
described under division (A)(4) of section 4735.022 of the Revised	269
Code, the person giving the consent makes and constitutes the	270
secretary of state as an agent for service of process in this	271
state including summonses and subpoenas. Service of process upon	272
any such person may be initiated by leaving with the secretary of	273
state or an assistant secretary of state four copies of the	274
process, together with an affidavit stating the address of the	275
person given on the consent-to-jurisdiction document and a fee of	276
five dollars. Upon receipt of the process, affidavit, and fee,	277
the secretary of state immediately shall give notice to the person	278
at the address given in the affidavit and forward to that address	279
by certified mail, return receipt requested, a copy of the	280
process. Service is considered to be complete upon the mailing of	281
the notice and copy of process in accordance with this division.	282

(D) A person, partnership, association, limited liability	283
company, limited liability partnership, or corporation licensed in	284
a jurisdiction where there is no legal distinction between a real	285
estate broker license and a real estate salesperson license must	286
meet the requirements of division (A) of this section before	287
engaging in any activity that requires a real estate broker	288
license in this state.	289

Sec. 4735.10.  (A)(1) The Ohio real estate commission may	290
adopt reasonable rules in accordance with Chapter 119. of the	291
Revised Code, necessary for implementing the provisions of this	292
chapter relating, but not limited to, the following:	293

(a) The form and manner of filing applications for license;

294

(b) Times and form of examination for license;

295

(c) Placing an existing broker's license on deposit or a	296
salesperson's license on an inactive status for an indefinite	297
period.	298

(2) The commission shall adopt reasonable rules in	299
accordance with Chapter 119. of the Revised Code, for implementing	300
the provisions of this chapter relating to the following:	301

(a) The issuance, renewal, suspension, and revocation of	302
licenses, other sanctions that may be imposed for violations of	303
this chapter, the conduct of hearings related to these actions,	304
and the process of reactivating a license;	305

(b) By not later than January 1, 2005, a three-year license	306
and a three-year license renewal system;	307

(c) Standards for the approval of courses of study required	308
for licenses, or offered in preparation for license examinations,	309
or required as continuing education for licenses. The rules shall	310
specify that no standard for the approval of a course of study	311
required as continuing education for licensees shall require that	312
licensees pass an examination as a condition for the successful	313
completion of a continuing education requirement. A person	314
providing a continuing education course may administer	315
examinations for the purpose of evaluating the effectiveness of	316
the course.	317

(c)(d) Guidelines to ensure that continuing education	318
classes are open to all persons licensed under this chapter. The	319
rules shall specify that an organization that sponsors a	320
continuing education class may offer its members a reasonable	321
reduction in the fees charged for the class.	322

(d)(e) Requirements for trust accounts and property	323
management accounts. The rules shall specify that:	324

(i) Brokerages engaged in the management of property for	325
another may, pursuant to a written contract with the property	326
owner, exercise signatory authority for withdrawals from property	327
management accounts maintained in the name of the property owner.	328
The exercise of authority for withdrawals does not constitute a	329
violation of any provision of division (A) of section 4735.18 of	330
the Revised Code.	331

(ii) The interest earned on property management trust	332
accounts maintained in the name of the property owner or the	333
broker shall be payable to the property owner unless otherwise	334
specified in a written contract.	335

(e)(f) Annual notice of renewal forms and filing deadlines;

336

(f)(g) Special assessments under division (A) of section	337
4735.12 of the Revised Code.	338

(B) The commission may adopt rules in accordance with	339
Chapter 119. of the Revised Code establishing standards and	340
guidelines with which the superintendent of real estate shall	341
comply in the exercise of the following powers:	342

(1) Appointment and recommendation of ancillary trustees	343
under section 4735.05 of the Revised Code;	344

(2) Rejection of names proposed to be used by partnerships,	345
associations, limited liability companies, limited liability	346
partnerships, and corporations, under division (A) of section	347
4735.06 of the Revised Code;	348

(3) Acceptance and rejection of applications to take the	349
broker and salesperson examinations and licensure, with	350
appropriate waivers pursuant to division (E) of section 4735.07	351
and section 4735.09 of the Revised Code;	352

(4) Approval of applications of brokers to place their	353
licenses on deposit and to become salespersons under section	354
4735.13 of the Revised Code;	355

(5) Appointment of hearing examiners under section 119.09 of	356
the Revised Code;	357

(6) Acceptance and rejection of applications to take the	358
foreign real estate dealer and salesperson examinations and	359
licensure, with waiver of examination, under sections 4735.27 and	360
4735.28 of the Revised Code;	361

(7) Qualification of foreign real estate under section	362
4735.25 of the Revised Code.	363

If at any time there is no rule in effect establishing a	364
guideline or standard required by this division, the	365
superintendent may adopt a rule in accordance with Chapter 119. of	366
the Revised Code for such purpose.	367

(C) The commission or superintendent may hear testimony in	368
matters relating to the duties imposed upon them, and the	369
president of the commission and superintendent may administer	370
oaths. The commission or superintendent may require other proof	371
of the honesty, truthfulness, and good reputation of any person	372
named in an application for a real estate broker's or real estate	373
salesperson's license before admitting the applicant to the	374
examination or issuing a license.	375

Sec. 4735.12.  (A) The real estate recovery fund is hereby	376
created in the state treasury, to be administered by the	377
superintendent of real estate. Amounts collected by the	378
superintendent as prescribed in this section and interest earned	379
on the assets of the fund shall be credited by the treasurer of	380
state to the fund. The amount of money in the fund shall be	381
ascertained by the superintendent as of the first day of July of	382
each year.	383

The commission, in accordance with rules adopted under	384
division (A)(2)(f)(g) of section 4735.10 of the Revised Code,	385
shall impose a special assessment not to exceed ten dollars	386
annually on each licensee filing a notice of renewal under section	387
4735.14 of the Revised Code if the amount available in the fund is	388
less than one million dollars on the first day of July preceding	389
that filing. The commission may impose a special assessment not	390
to exceed five dollars annually if the amount available in the	391
fund is greater than one million dollars, but less than two	392
million dollars on the first day of July preceding that filing.	393
The commission shall not impose a special assessment if the amount	394
available in the fund exceeds two million dollars on the first day	395
of July preceding that filing.	396

(B)(1) Any person who obtains a final judgment in any court	397
of competent jurisdiction against any broker or salesperson	398
licensed under this chapter, on the grounds of conduct that is in	399
violation of this chapter or the rules adopted under it, and that	400
is associated with an act or transaction that only a licensed real	401
estate broker or licensed real estate salesperson is authorized to	402
perform as specified in division (A) or (C) of section 4735.01 of	403
the Revised Code, may file a verified application, as described in	404
division (B)(3) of this section, in any court of common pleas for	405
an order directing payment out of the real estate recovery fund of	406
the portion of the judgment that remains unpaid and that	407
represents the actual and direct loss sustained by the applicant.	408

(2) Punitive damages, attorney's fees, and interest on a	409
judgment are not recoverable from the fund. In the discretion of	410
the superintendent of real estate, court costs may be recovered	411
from the fund, and, if the superintendent authorizes the recovery	412
of court costs, the order of the court of common pleas then may	413
direct their payment from the fund.	414

(3) The application shall specify the nature of the act or	415
transaction upon which the underlying judgment was based, the	416
activities of the applicant in pursuit of remedies available under	417
law for the collection of judgments, and the actual and direct	418
losses, attorney's fees, and the court costs sustained or incurred	419
by the applicant. The applicant shall attach to the application a	420
copy of each pleading and order in the underlying court action.	421

(4) The court shall order the superintendent to make such	422
payments out of the fund when the person seeking the order has	423
shown all of the following:	424

(a) The person has obtained a judgment, as provided in this	425
division;	426

(b) All appeals from the judgment have been exhausted and	427
the person has given notice to the superintendent, as required by	428
division (C) of this section;	429

(c) The person is not a spouse of the judgment debtor, or	430
the personal representative of such spouse;	431

(d) The person has diligently pursued the person's remedies	432
against all the judgment debtors and all other persons liable to	433
the person in the transaction for which the person seeks recovery	434
from the fund;	435

(e) The person is making the person's application not more	436
than one year after termination of all proceedings, including	437
appeals, in connection with the judgment.	438

(5) Divisions (B)(1) to (4) of this section do not apply to	439
any of the following:	440

(a) Actions arising from property management accounts	441
maintained in the name of the property owner;	442

(b) A bonding company when it is not a principal in a real	443
estate transaction;	444

(c) A person in an action for the payment of a commission or	445
fee for the performance of an act or transaction specified or	446
comprehended in division (A) or (C) of section 4735.01 of the	447
Revised Code;	448

(d) Losses incurred by investors in real estate if the	449
applicant and the licensee are principals in the investment.	450

(C) A person who applies to a court of common pleas for an	451
order directing payment out of the fund shall file notice of the	452
application with the superintendent. The superintendent may	453
defend any such action on behalf of the fund and shall have	454
recourse to all appropriate means of defense and review, including	455
examination of witnesses, verification of actual and direct	456
losses, and challenges to the underlying judgment required in	457
division (B)(4)(a) of this section to determine whether the	458
underlying judgment is based on activity only a licensed broker or	459
licensed salesperson is permitted to perform. The superintendent	460
may move the court at any time to dismiss the application when it	461
appears there are no triable issues and the application is without	462
merit. The motion may be supported by affidavit of any person	463
having knowledge of the facts and may be made on the basis that	464
the application, including the judgment referred to in it, does	465
not form the basis for a meritorious recovery claim; provided,	466
that the superintendent shall give written notice to the applicant	467
at least ten days before such motion. The superintendent may,	468
subject to court approval, compromise a claim based upon the	469
application of an aggrieved party. The superintendent shall not	470
be bound by any prior compromise or stipulation of the judgment	471
debtor.	472

(D) Notwithstanding any other provision of this section, the	473
liability of the fund shall not exceed forty thousand dollars for	474
any one licensee. If a licensee's license is reactivated as	475
provided in division (E) of this section, the liability of the	476
fund for the licensee under this section shall again be forty	477
thousand dollars, but only for transactions that occur subsequent	478
to the time of reactivation.	479

If the forty-thousand-dollar liability of the fund is	480
insufficient to pay in full the valid claims of all aggrieved	481
persons by whom claims have been filed against any one licensee,	482
the forty thousand dollars shall be distributed among them in the	483
ratio that their respective claims bear to the aggregate of valid	484
claims or in such other manner as the court finds equitable.	485
Distribution of moneys shall be among the persons entitled to	486
share in it, without regard to the order of priority in which	487
their respective judgments may have been obtained or their claims	488
have been filed. Upon petition of the superintendent, the court	489
may require all claimants and prospective claimants against one	490
licensee to be joined in one action, to the end that the	491
respective rights of all such claimants to the fund may be	492
equitably adjudicated and settled.	493

(E) If the superintendent pays from the fund any amount in	494
settlement of a claim or toward satisfaction of a judgment against	495
a licensed broker or salesperson, the license of the broker or	496
salesperson shall be automatically suspended upon the date of	497
payment from the fund. The superintendent shall not reactivate	498
the suspended license of that broker or salesperson until the	499
broker or salesperson has repaid in full, plus interest per annum	500
at the rate specified in division (A) of section 1343.03 of the	501
Revised Code, the amount paid from the fund on the broker's or	502
salesperson's account. A discharge in bankruptcy does not relieve	503
a person from the suspension and requirements for reactivation	504
provided in this section unless the underlying judgment has been	505
included in the discharge and has not been reaffirmed by the	506
debtor.	507

(F) If, at any time, the money deposited in the fund is	508
insufficient to satisfy any duly authorized claim or portion of a	509
claim, the superintendent shall, when sufficient money has been	510
deposited in the fund, satisfy such unpaid claims or portions, in	511
the order that such claims or portions were originally filed, plus	512
accumulated interest per annum at the rate specified in division	513
(A) of section 1343.03 of the Revised Code.	514

(G) When, upon the order of the court, the superintendent	515
has paid from the fund any sum to the judgment creditor, the	516
superintendent shall be subrogated to all of the rights of the	517
judgment creditor to the extent of the amount so paid, and the	518
judgment creditor shall assign all the judgment creditor's right,	519
title, and interest in the judgment to the superintendent to the	520
extent of the amount so paid. Any amount and interest so	521
recovered by the superintendent on the judgment shall be deposited	522
in the fund.	523

(H) Nothing contained in this section shall limit the	524
authority of the superintendent to take disciplinary action	525
against any licensee under other provisions of this chapter; nor	526
shall the repayment in full of all obligations to the fund by any	527
licensee nullify or modify the effect of any other disciplinary	528
proceeding brought pursuant to this chapter.	529

(I) The superintendent shall collect from the fund a service	530
fee in an amount equivalent to the interest rate specified in	531
division (A) of section 1343.03 of the Revised Code multiplied by	532
the annual interest earned on the assets of the fund, to defray	533
the expenses incurred in the administration of the fund.	534

Sec. 4735.14.  (A) Each license issued under this chapter,	535
shall be valid without further recommendation or examination until	536
placed in an inactive status, revoked, suspended, or such license	537
expires by operation of law.	538

(B) Each licensed broker, brokerage, or salesperson shall	539
file, on or before the date the Ohio real estate commission has	540
adopted by rule for that licensee in accordance with division	541
(A)(2)(e)(f) of section 4735.10 of the Revised Code, a notice of	542
renewal on a form prescribed by the superintendent of real estate.	543
The licensee shall indicate on the form whether the licensee	544
wishes to maintain the licensee's license in an active or inactive	545
status. The notice of renewal shall be mailed by the	546
superintendent to the most current personal residence address of	547
each broker or salesperson as filed with the superintendent by the	548
licensee and the place of business address of the brokerage two	549
months prior to the filing deadline.	550

(C) The license of any real estate broker, brokerage, or	551
salesperson that fails to file a notice of renewal on or before	552
the filing deadline of each ensuing year shall be suspended	553
automatically without the taking of any action by the	554
superintendent. A suspended license may be reactivated within	555
twelve months of the date of suspension, provided that the renewal	556
fee plus a penalty fee of fifty per cent of the renewal fee is	557
paid to the superintendent. Failure to reactivate the license as	558
provided in this division shall result in automatic revocation of	559
the license without the taking of any action by the	560
superintendent. No person, partnership, association, corporation,	561
limited liability company, or limited partnership shall engage in	562
any act or acts for which a real estate license is required while	563
that entity's license is placed in an inactive status, suspended,	564
or revoked. The commission shall adopt rules in accordance with	565
Chapter 119. of the Revised Code to provide to licensees notice of	566
suspension or revocation or both.	567

(D) Each licensee shall notify the commission of a change in	568
personal residence address. A licensee's failure to notify the	569
commission of a change in personal residence address does not	570
negate the requirement to file the license renewal by the required	571
deadline established by the commission by rule under division	572
(A)(2)(e)(f) of section 4735.10 of the Revised Code.	573

(E) The superintendent shall not renew a license if the	574
licensee is not in compliance with this chapter.	575

Sec. 4735.18.  (A) Subject to section 4735.32 of the Revised	576
Code, the superintendent of real estate, upon the superintendent's	577
own motion, may investigate the conduct of any licensee. Subject	578
to section 4735.32 of the Revised Code, the Ohio real estate	579
commission shall, pursuant to section 4735.051 of the Revised	580
Code, impose disciplinary sanctions upon any licensee who, whether	581
or not acting in the licensee's capacity as a real estate broker	582
or salesperson, or in handling the licensee's own property, is	583
found to have been convicted of a felony or a crime of moral	584
turpitude, and shall, pursuant to section 4735.051 of the Revised	585
Code, impose disciplinary sanctions upon any licensee who, in the	586
licensee's capacity as a real estate broker or salesperson, or in	587
handling the licensee's own property, is found guilty of:	588

(1) Knowingly making any misrepresentation;

589

(2) Making any false promises with intent to influence,	590
persuade, or induce;	591

(3) A continued course of misrepresentation or the making of	592
false promises through agents, salespersons, advertising, or	593
otherwise;	594

(4) Acting for more than one party in a transaction except	595
as permitted by and in compliance with section 4735.71 of the	596
Revised Code;	597

(5) Failure within a reasonable time to account for or to	598
remit any money coming into the licensee's possession which	599
belongs to others;	600

(6) Dishonest or illegal dealing, gross negligence,	601
incompetency, or misconduct;	602

(7)(a) By final adjudication by a court, a violation of any	603
municipal or federal civil rights law relevant to the protection	604
of purchasers or sellers of real estate or, by final adjudication	605
by a court, any unlawful discriminatory practice pertaining to the	606
purchase or sale of real estate prohibited by Chapter 4112. of the	607
Revised Code, provided that such violation arose out of a	608
situation wherein parties were engaged in bona fide efforts to	609
purchase, sell, or lease real estate, in the licensee's practice	610
as a licensed real estate broker or salesperson;	611

(b) A second or subsequent violation of any unlawful	612
discriminatory practice pertaining to the purchase or sale of real	613
estate prohibited by Chapter 4112. of the Revised Code or any	614
second or subsequent violation of municipal or federal civil	615
rights laws relevant to purchasing or selling real estate whether	616
or not there has been a final adjudication by a court, provided	617
that such violation arose out of a situation wherein parties were	618
engaged in bona fide efforts to purchase, sell, or lease real	619
estate. For any second offense under this division, the	620
commission shall suspend for a minimum of two months or revoke the	621
license of the broker or salesperson. For any subsequent offense,	622
the commission shall revoke the license of the broker or	623
salesperson.	624

(8) Procuring a license under this chapter, for the licensee	625
or any salesperson by fraud, misrepresentation, or deceit;	626

(9) Having violated or failed to comply with any provision	627
of sections 4735.51 to 4735.74 of the Revised Code or having	628
willfully disregarded or violated any other provisions of this	629
chapter;	630

(10) As a real estate broker, having demanded, without	631
reasonable cause, other than from a broker licensed under this	632
chapter, a commission to which the licensee is not entitled, or,	633
as a real estate salesperson, having demanded, without reasonable	634
cause, a commission to which the licensee is not entitled;	635

(11) Having paid commissions or fees to, or divided	636
commissions or fees with, anyone not licensed as a real estate	637
broker or salesperson under this chapter or anyone not operating	638
as an out of state commercial real estate broker or salesperson	639
under section 4735.022 of the Revised Code;	640

(12) Having falsely represented membership in any real	641
estate professional association of which the licensee is not a	642
member;	643

(13) Having accepted, given, or charged any undisclosed	644
commission, rebate, or direct profit on expenditures made for a	645
principal;	646

(14) Having offered anything of value other than the	647
consideration recited in the sales contract as an inducement to a	648
person to enter into a contract for the purchase or sale of real	649
estate or having offered real estate or the improvements on real	650
estate as a prize in a lottery or scheme of chance;	651

(15) Having acted in the dual capacity of real estate broker	652
and undisclosed principal, or real estate salesperson and	653
undisclosed principal, in any transaction;	654

(16) Having guaranteed, authorized, or permitted any person	655
to guarantee future profits which may result from the resale of	656
real property;	657

(17) Having placed a sign on any property offering it for	658
sale or for rent without the consent of the owner or the owner's	659
authorized agent;	660

(18) Having induced any party to a contract of sale or lease	661
to break such contract for the purpose of substituting in lieu of	662
it a new contract with another principal;	663

(19) Having negotiated the sale, exchange, or lease of any	664
real property directly with an owner, purchaser, lessor, or tenant	665
knowing that such owner, purchaser, lessor, or tenant had a	666
written outstanding contract granting exclusive agency in	667
connection with such property to another real estate broker;	668

(20) Having offered real property for sale or for lease	669
without the knowledge and consent of the owner or the owner's	670
authorized agent, or on any terms other than those authorized by	671
the owner or the owner's authorized agent;	672

(21) Having published advertising, whether printed, radio,	673
display, or of any other nature, which was misleading or	674
inaccurate in any material particular, or in any way having	675
misrepresented any properties, terms, values, policies, or	676
services of the business conducted;	677

(22) Having knowingly withheld from or inserted in any	678
statement of account or invoice any statement that made it	679
inaccurate in any material particular;	680

(23) Having published or circulated unjustified or	681
unwarranted threats of legal proceedings which tended to or had	682
the effect of harassing competitors or intimidating their	683
customers;	684

(24) Having failed to keep complete and accurate records of	685
all transactions for a period of three years from the date of the	686
transaction, such records to include copies of listing forms,	687
earnest money receipts, offers to purchase and acceptances of	688
them, and records of receipts and disbursements of all funds	689
received by the licensee as broker and incident to the licensee's	690
transactions as such, and any other instruments or papers related	691
to the performance of any of the acts set forth in the definition	692
of a real estate broker;	693

(25) Failure of a real estate broker or salesperson to	694
furnish all parties involved in a real estate transaction true	695
copies of all listings and other agreements to which they are a	696
party, at the time each party signs them;	697

(26) Failure to maintain at all times a special or trust	698
bank account in a depository located in this state. The account	699
shall be noninterest-bearing, separate and distinct from any	700
personal or other account of the broker, and, except as provided	701
in division (A)(27) of this section, shall be used for the deposit	702
and maintenance of all escrow funds, security deposits, and other	703
moneys received by the broker in a fiduciary capacity. The name,	704
account number, if any, and location of the depository wherein	705
such special or trust account is maintained shall be submitted in	706
writing to the superintendent. Checks drawn on such special or	707
trust bank accounts are deemed to meet the conditions imposed by	708
section 1349.21 of the Revised Code.	709

(27) Failure to maintain at all times a special or trust	710
bank account in a depository in this state, to be used exclusively	711
for the deposit and maintenance of all rents, security deposits,	712
escrow funds, and other moneys received by the broker in a	713
fiduciary capacity in the course of managing real property. This	714
account shall be separate and distinct from any other account	715
maintained by the broker. The name, account number, and location	716
of the depository shall be submitted in writing to the	717
superintendent. This account may earn interest, which shall be	718
paid to the property owners on a pro rata basis.	719

Division (A)(27) of this section does not apply to brokers	720
who are not engaged in the management of real property on behalf	721
of real property owners.	722

(28) Having failed to put definite expiration dates in all	723
written agency agreements to which the broker is a party;	724

(29) Having an unsatisfied final judgment in any court of	725
record against the licensee arising out of the licensee's conduct	726
as a licensed broker or salesperson;	727

(30) Failing to render promptly upon demand a full and	728
complete statement of the expenditures by the broker or	729
salesperson of funds advanced by or on behalf of a party to a real	730
estate transaction to the broker or salesperson for the purpose of	731
performing duties as a licensee under this chapter in conjunction	732
with the real estate transaction;	733

(31) Failure within a reasonable time, after the receipt of	734
the commission by the broker, to render an accounting to and pay a	735
real estate salesperson the salesperson's earned share of it;	736

(32) Performing any service for another constituting the	737
practice of law, as determined by any court of law;	738

(33) Having been adjudicated incompetent for the purpose of	739
holding the license by a court, as provided in section 5122.301 of	740
the Revised Code. A license revoked or suspended under this	741
division shall be reactivated upon proof to the commission of the	742
removal of the disability.	743

(34) Having authorized or permitted a person to act as an	744
agent in the capacity of a real estate broker, or a real estate	745
salesperson, who was not then licensed as a real estate broker or	746
real estate salesperson under this chapter or who was not then	747
operating as an out of state commercial real estate broker or	748
salesperson under section 4735.022 of the Revised Code;	749

(35) Having knowingly inserted or participated in inserting	750
any materially inaccurate term in a document, including naming a	751
false consideration;	752

(36) Having failed to inform the licensee's client of the	753
existence of an offer or counter offer or having failed to present	754
an offer or counter offer in a timely manner, unless otherwise	755
instructed by the client, provided the instruction of the client	756
does not conflict with any state or federal law.	757

(B) Whenever the commission, pursuant to section 4735.051 of	758
the Revised Code, imposes disciplinary sanctions for any violation	759
of this section, the commission also may impose such sanctions	760
upon the broker with whom the salesperson is affiliated if the	761
commission finds that the broker had knowledge of the	762
salesperson's actions that violated this section.	763

(C) The commission shall, pursuant to section 4735.051 of	764
the Revised Code, impose disciplinary sanctions upon any foreign	765
real estate dealer or salesperson who, in that capacity or in	766
handling the dealer's or salesperson's own property, is found	767
guilty of any of the acts or omissions specified or comprehended	768
in division (A) of this section insofar as the acts or omissions	769
pertain to foreign real estate. If the commission imposes such	770
sanctions upon a foreign real estate salesperson for a violation	771
of this section, the commission also may suspend or revoke the	772
license of the foreign real estate dealer with whom the	773
salesperson is affiliated if the commission finds that the dealer	774
had knowledge of the salesperson's actions that violated this	775
section.	776

(D) The commission may suspend, in whole or in part, the	777
imposition of the penalty of suspension of a license under this	778
section.	779

(E) The commission immediately shall notify the real estate	780
appraiser board of any disciplinary action taken under this	781
section against a licensee who also is a state-certified real	782
estate appraiser under Chapter 4763. of the Revised Code.	783

Section 2. That existing sections 4735.01, 4735.02, 4735.10,	784
4735.12, 4735.14, and 4735.18 of the Revised Code are hereby	785
repealed.	786