Illinois General Assembly - Full Text of SB1440
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Full Text of SB1440  99th General Assembly


Sen. John M. Sullivan

Filed: 3/10/2015





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2    AMENDMENT NO. ______. Amend Senate Bill 1440 by replacing
3everything after the enacting clause with the following:
4    "Section 5. The Real Estate License Act of 2000 is amended
5by changing Sections 1-10 and 5-32 as follows:
6    (225 ILCS 454/1-10)
7    (Section scheduled to be repealed on January 1, 2020)
8    Sec. 1-10. Definitions. In this Act, unless the context
9otherwise requires:
10    "Act" means the Real Estate License Act of 2000.
11    "Address of Record" means the designated address recorded
12by the Department in the applicant's or licensee's application
13file or license file as maintained by the Department's
14licensure maintenance unit. It is the duty of the applicant or
15licensee to inform the Department of any change of address, and
16those changes must be made either through the Department's



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1website or by contacting the Department.
2    "Advisory Council" means the Real Estate Education
3Advisory Council created under Section 30-10 of this Act.
4    "Agency" means a relationship in which a real estate broker
5or licensee, whether directly or through an affiliated
6licensee, represents a consumer by the consumer's consent,
7whether express or implied, in a real property transaction.
8    "Applicant" means any person, as defined in this Section,
9who applies to the Department for a valid license as a real
10estate broker, real estate salesperson, or leasing agent.
11    "Blind advertisement" means any real estate advertisement
12that does not include the sponsoring broker's business name and
13that is used by any licensee regarding the sale or lease of
14real estate, including his or her own, licensed activities, or
15the hiring of any licensee under this Act. The broker's
16business name in the case of a franchise shall include the
17franchise affiliation as well as the name of the individual
19    "Board" means the Real Estate Administration and
20Disciplinary Board of the Department as created by Section
2125-10 of this Act.
22    "Branch office" means a sponsoring broker's office other
23than the sponsoring broker's principal office.
24    "Broker" means an individual, partnership, limited
25liability company, corporation, or registered limited
26liability partnership other than a real estate salesperson or



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1leasing agent who, whether in person or through any media or
2technology, for another and for compensation, or with the
3intention or expectation of receiving compensation, either
4directly or indirectly:
5        (1) Sells, exchanges, purchases, rents, or leases real
6    estate.
7        (2) Offers to sell, exchange, purchase, rent, or lease
8    real estate.
9        (3) Negotiates, offers, attempts, or agrees to
10    negotiate the sale, exchange, purchase, rental, or leasing
11    of real estate.
12        (4) Lists, offers, attempts, or agrees to list real
13    estate for sale, lease, or exchange.
14        (5) Buys, sells, offers to buy or sell, or otherwise
15    deals in options on real estate or improvements thereon.
16        (6) Supervises the collection, offer, attempt, or
17    agreement to collect rent for the use of real estate.
18        (7) Advertises or represents himself or herself as
19    being engaged in the business of buying, selling,
20    exchanging, renting, or leasing real estate.
21        (8) Assists or directs in procuring or referring of
22    leads or prospects, intended to result in the sale,
23    exchange, lease, or rental of real estate.
24        (9) Assists or directs in the negotiation of any
25    transaction intended to result in the sale, exchange,
26    lease, or rental of real estate.



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1        (10) Opens real estate to the public for marketing
2    purposes.
3        (11) Sells, leases, or offers for sale or lease real
4    estate at auction.
5        (12) Prepares or provides a broker price opinion or
6    comparative market analysis as those terms are defined in
7    this Act, pursuant to the provisions of Section 10-45 of
8    this Act.
9    "Brokerage agreement" means a written or oral agreement
10between a sponsoring broker and a consumer for licensed
11activities to be provided to a consumer in return for
12compensation or the right to receive compensation from another.
13Brokerage agreements may constitute either a bilateral or a
14unilateral agreement between the broker and the broker's client
15depending upon the content of the brokerage agreement. All
16exclusive brokerage agreements shall be in writing.
17    "Broker price opinion" means an estimate or analysis of the
18probable selling price of a particular interest in real estate,
19which may provide a varying level of detail about the
20property's condition, market, and neighborhood and information
21on comparable sales. The activities of a real estate broker or
22managing broker engaging in the ordinary course of business as
23a broker, as defined in this Section, shall not be considered a
24broker price opinion if no compensation is paid to the broker
25or managing broker, other than compensation based upon the sale
26or rental of real estate.



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1    "Client" means a person who is being represented by a
3    "Comparative market analysis" is an analysis or opinion
4regarding pricing, marketing, or financial aspects relating to
5a specified interest or interests in real estate that may be
6based upon an analysis of comparative market data, the
7expertise of the real estate broker or managing broker, and
8such other factors as the broker or managing broker may deem
9appropriate in developing or preparing such analysis or
10opinion. The activities of a real estate broker or managing
11broker engaging in the ordinary course of business as a broker,
12as defined in this Section, shall not be considered a
13comparative market analysis if no compensation is paid to the
14broker or managing broker, other than compensation based upon
15the sale or rental of real estate.
16    "Compensation" means the valuable consideration given by
17one person or entity to another person or entity in exchange
18for the performance of some activity or service. Compensation
19shall include the transfer of valuable consideration,
20including without limitation the following:
21        (1) commissions;
22        (2) referral fees;
23        (3) bonuses;
24        (4) prizes;
25        (5) merchandise;
26        (6) finder fees;



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1        (7) performance of services;
2        (8) coupons or gift certificates;
3        (9) discounts;
4        (10) rebates;
5        (11) a chance to win a raffle, drawing, lottery, or
6    similar game of chance not prohibited by any other law or
7    statute;
8        (12) retainer fee; or
9        (13) salary.
10    "Confidential information" means information obtained by a
11licensee from a client during the term of a brokerage agreement
12that (i) was made confidential by the written request or
13written instruction of the client, (ii) deals with the
14negotiating position of the client, or (iii) is information the
15disclosure of which could materially harm the negotiating
16position of the client, unless at any time:
17        (1) the client permits the disclosure of information
18    given by that client by word or conduct;
19        (2) the disclosure is required by law; or
20        (3) the information becomes public from a source other
21    than the licensee.
22    "Confidential information" shall not be considered to
23include material information about the physical condition of
24the property.
25    "Consumer" means a person or entity seeking or receiving
26licensed activities.



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1    "Continuing education school" means any person licensed by
2the Department as a school for continuing education in
3accordance with Section 30-15 of this Act.
4    "Coordinator" means the Coordinator of Real Estate created
5in Section 25-15 of this Act.
6    "Credit hour" means 50 minutes of classroom instruction in
7course work that meets the requirements set forth in rules
8adopted by the Department.
9    "Customer" means a consumer who is not being represented by
10the licensee but for whom the licensee is performing
11ministerial acts.
12    "Department" means the Department of Financial and
13Professional Regulation.
14    "Designated agency" means a contractual relationship
15between a sponsoring broker and a client under Section 15-50 of
16this Act in which one or more licensees associated with or
17employed by the broker are designated as agent of the client.
18    "Designated agent" means a sponsored licensee named by a
19sponsoring broker as the legal agent of a client, as provided
20for in Section 15-50 of this Act.
21    "Dual agency" means an agency relationship in which a
22licensee is representing both buyer and seller or both landlord
23and tenant in the same transaction. When the agency
24relationship is a designated agency, the question of whether
25there is a dual agency shall be determined by the agency
26relationships of the designated agent of the parties and not of



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1the sponsoring broker.
2    "Employee" or other derivative of the word "employee", when
3used to refer to, describe, or delineate the relationship
4between a real estate broker and a real estate salesperson,
5another real estate broker, or a leasing agent, shall be
6construed to include an independent contractor relationship,
7provided that a written agreement exists that clearly
8establishes and states the relationship. All responsibilities
9of a broker shall remain.
10    "Escrow moneys" means all moneys, promissory notes or any
11other type or manner of legal tender or financial consideration
12deposited with any person for the benefit of the parties to the
13transaction. A transaction exists once an agreement has been
14reached and an accepted real estate contract signed or lease
15agreed to by the parties. Escrow moneys includes without
16limitation earnest moneys and security deposits, except those
17security deposits in which the person holding the security
18deposit is also the sole owner of the property being leased and
19for which the security deposit is being held.
20    "Electronic means of proctoring" means a methodology
21providing assurance that the person taking a test and
22completing the answers to questions is the person seeking
23licensure or credit for continuing education and is doing so
24without the aid of a third party or other device.
25    "Exclusive brokerage agreement" means a written brokerage
26agreement that provides that the sponsoring broker has the sole



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1right, through one or more sponsored licensees, to act as the
2exclusive designated agent or representative of the client and
3that meets the requirements of Section 15-75 of this Act.
4    "Grandfathered auctioneer" means a person who is exempt
5from holding a license under paragraph (13) of Section 5-20 of
6this Act.
7    "Inoperative" means a status of licensure where the
8licensee holds a current license under this Act, but the
9licensee is prohibited from engaging in licensed activities
10because the licensee is unsponsored or the license of the
11sponsoring broker with whom the licensee is associated or by
12whom he or she is employed is currently expired, revoked,
13suspended, or otherwise rendered invalid under this Act.
14    "Interactive delivery method" means delivery of a course by
15an instructor through a medium allowing for 2-way communication
16between the instructor and a student in which either can
17initiate or respond to questions.
18    "Leads" means the name or names of a potential buyer,
19seller, lessor, lessee, or client of a licensee.
20    "Leasing Agent" means a person who is employed by a real
21estate broker to engage in licensed activities limited to
22leasing residential real estate who has obtained a license as
23provided for in Section 5-5 of this Act.
24    "License" means the document issued by the Department
25certifying that the person named thereon has fulfilled all
26requirements prerequisite to licensure under this Act.



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1    "Licensed activities" means those activities listed in the
2definition of "broker" under this Section.
3    "Licensee" means any person, as defined in this Section,
4who holds a valid unexpired license as a real estate broker,
5real estate salesperson, or leasing agent.
6    "Listing presentation" means a communication between a
7real estate broker or salesperson and a consumer in which the
8licensee is attempting to secure a brokerage agreement with the
9consumer to market the consumer's real estate for sale or
11    "Managing broker" means a broker who has supervisory
12responsibilities for licensees in one or, in the case of a
13multi-office company, more than one office and who has been
14appointed as such by the sponsoring broker.
15    "Medium of advertising" means any method of communication
16intended to influence the general public to use or purchase a
17particular good or service or real estate.
18    "Ministerial acts" means those acts that a licensee may
19perform for a consumer that are informative or clerical in
20nature and do not rise to the level of active representation on
21behalf of a consumer. Examples of these acts include without
22limitation (i) responding to phone inquiries by consumers as to
23the availability and pricing of brokerage services, (ii)
24responding to phone inquiries from a consumer concerning the
25price or location of property, (iii) attending an open house
26and responding to questions about the property from a consumer,



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1(iv) setting an appointment to view property, (v) responding to
2questions of consumers walking into a licensee's office
3concerning brokerage services offered or particular
4properties, (vi) accompanying an appraiser, inspector,
5contractor, or similar third party on a visit to a property,
6(vii) describing a property or the property's condition in
7response to a consumer's inquiry, (viii) completing business or
8factual information for a consumer on an offer or contract to
9purchase on behalf of a client, (ix) showing a client through a
10property being sold by an owner on his or her own behalf, or
11(x) referral to another broker or service provider.
12    "Office" means a real estate broker's place of business
13where the general public is invited to transact business and
14where records may be maintained and licenses displayed, whether
15or not it is the broker's principal place of business.
16    "Person" means and includes individuals, entities,
17corporations, limited liability companies, registered limited
18liability partnerships, and partnerships, foreign or domestic,
19except that when the context otherwise requires, the term may
20refer to a single individual or other described entity.
21    "Personal assistant" means a licensed or unlicensed person
22who has been hired for the purpose of aiding or assisting a
23sponsored licensee in the performance of the sponsored
24licensee's job.
25    "Pocket card" means the card issued by the Department to
26signify that the person named on the card is currently licensed



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1under this Act.
2    "Pre-license school" means a school licensed by the
3Department offering courses in subjects related to real estate
4transactions, including the subjects upon which an applicant is
5examined in determining fitness to receive a license.
6    "Pre-renewal period" means the period between the date of
7issue of a currently valid license and the license's expiration
9    "Proctor" means any person, including, but not limited to,
10an instructor, who has a written agreement to administer
11examinations fairly and impartially with a licensed
12pre-license school or a licensed continuing education school.
13    "Real estate" means and includes leaseholds as well as any
14other interest or estate in land, whether corporeal,
15incorporeal, freehold, or non-freehold, including timeshare
16interests, and whether the real estate is situated in this
17State or elsewhere.
18    "Regular employee" means a person working an average of 20
19hours per week for a person or entity who would be considered
20as an employee under the Internal Revenue Service eleven main
21tests in three categories being behavioral control, financial
22control and the type of relationship of the parties, formerly
23the twenty factor test.
24    "Salesperson" means any individual, other than a real
25estate broker or leasing agent, who is employed by a real
26estate broker or is associated by written agreement with a real



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1estate broker as an independent contractor and participates in
2any activity described in the definition of "broker" under this
4    "Secretary" means the Secretary of the Department of
5Financial and Professional Regulation, or a person authorized
6by the Secretary to act in the Secretary's stead.
7    "Sponsoring broker" means the broker who has issued a
8sponsor card to a licensed salesperson, another licensed
9broker, or a leasing agent.
10    "Sponsor card" means the temporary permit issued by the
11sponsoring real estate broker certifying that the real estate
12broker, real estate salesperson, or leasing agent named thereon
13is employed by or associated by written agreement with the
14sponsoring real estate broker, as provided for in Section 5-40
15of this Act.
16(Source: P.A. 98-531, eff. 8-23-13; 98-1109, eff. 1-1-15.)
17    (225 ILCS 454/5-32)
18    (Section scheduled to be repealed on January 1, 2020)
19    Sec. 5-32. Real estate auction certification.
20    (a) An auctioneer licensed under the Auction License Act
21who does not possess a valid and active broker's or managing
22broker's license under this Act, or who is not otherwise exempt
23from licensure, may not engage in the practice of auctioning
24real estate, except as provided in this Section.
25    (b) The Department shall issue a real estate auction



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1certification to applicants who:
2        (1) possess a valid auctioneer's license under the
3    Auction License Act;
4        (2) successfully complete a real estate auction course
5    of at least 30 hours approved by the Department, which
6    shall cover the scope of activities that may be engaged in
7    by a person holding a real estate auction certification and
8    the activities for which a person must hold a real estate
9    license, as well as other material as provided by the
10    Department;
11        (3) provide documentation of the completion of the real
12    estate auction course; and
13        (4) successfully complete any other reasonable
14    requirements as provided by rule.
15    (c) The auctioneer's role shall be limited to establishing
16the time, place, and method of the real estate auction, placing
17advertisements regarding the auction, and crying or calling the
18auction; any other real estate brokerage activities must be
19performed by a person holding a valid and active real estate
20broker's or managing broker's license under the provisions of
21this Act or by a grandfathered auctioneer a person who is
22exempt from holding a license under paragraph (13) of Section
235-20 who has a certificate under this Section. A grandfathered
24auctioneer must only be certified under this Section if the
25grandfathered auctioneer sells or leases real estate at auction
26in a transaction in which a licensed auctioneer with a real



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1estate certification is providing the limited services
2provided for in this subsection (c).
3    (d) An auctioneer who conducts any real estate auction
4activities in violation of this Section is guilty of unlicensed
5practice under Section 20-10 of this Act.
6    (e) The Department may revoke, suspend, or otherwise
7discipline the real estate auction certification of an
8auctioneer who is adjudicated to be in violation of the
9provisions of this Section or Section 20-15 of the Auction
10License Act.
11    (f) Advertising for the real estate auction must contain
12the name and address of the licensed real estate broker,
13managing broker, or a licensed auctioneer under paragraph (13)
14of Section 5-20 of this Act who is providing brokerage services
15for the transaction.
16    (g) (Blank). The requirement to hold a real estate auction
17certification shall not apply to a person exempt from this Act
18under the provisions of paragraph (13) of Section 5-20 of this
19Act, unless that person is performing licensed activities in a
20transaction in which a licensed auctioneer with a real estate
21certification is providing the limited services provided for in
22subsection (c) of this Section.
23    (h) Nothing in this Section shall require a person licensed
24under this Act as a real estate broker or managing broker to
25obtain a real estate auction certification in order to auction
26real estate.



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1    (i) The Department may adopt rules to implement this
3(Source: P.A. 98-553, eff. 1-1-14; 98-756, eff. 7-16-14.)
4    Section 99. Effective date. This Act takes effect upon
5becoming law.".