Chapter 224
AN ACT
SB 166
Relating to client trust accounts maintained
by real estate licensees; creating new provisions; and amending ORS 696.241.
Be It Enacted by the People of
the State of
SECTION 1. ORS 696.241 is amended to read:
696.241. (1) Each sole
practitioner and each principal real estate broker shall maintain in this state
one or more separate bank accounts that shall be designated a Clients’ Trust
Account in which all trust funds received or handled by the sole practitioner
or broker and the real estate licensees subject to the supervision of the
broker on behalf of any other person shall be deposited unless, pursuant to
written agreement of all parties having an interest in the trust funds, the
trust funds are immediately placed in a neutral escrow depository in this
state.
(2) Each sole
practitioner or principal real estate broker shall file with the Real Estate
Agency, on forms approved by the Real Estate Commissioner, a statement
identifying the name of the bank or banks, account number or account numbers,
and name of account or accounts for each Clients’
Trust Account maintained.
(3) Each sole
practitioner or principal real estate broker shall authorize the agency, by a
form approved by the commissioner, to examine any Clients’ Trust Account, by a
duly authorized representative of the agency. The examination shall be made at
such times as the commissioner may direct.
(4) If a sole
practitioner or principal real estate broker maintains a separate Clients’ Trust
Account in a branch office, a separate bookkeeping system shall be maintained
in the branch office, provided a copy of the records required by the provisions
of ORS 696.280 are maintained in the main office of the sole practitioner or
broker.
(5) Trust funds received
by a sole practitioner or principal real estate broker may be placed by the
sole practitioner or broker in a federally insured interest-bearing bank
account, designated a Clients’ Trust Account, but only with the prior written
approval of all parties having an interest in the trust funds. The earnings of
such interest-bearing account shall not inure to the benefit of the sole
practitioner or principal real estate broker unless expressly approved in
writing before deposit of the trust funds by all parties having an interest in
the trust funds.
(6) With prior written
notice to all parties who have an interest in the trust funds, a sole
practitioner or principal real estate broker may place trust funds received by
the sole practitioner or principal real estate broker in a federally insured
interest-bearing bank account that is designated a Clients’ Trust Account and
the earnings of which inure to the benefit of a public benefit corporation, as
defined in ORS 65.001, for distribution to organizations and individuals for
first-time homebuying assistance and for development of affordable housing. The
sole practitioner or principal real estate broker shall select a qualified
public benefit corporation to receive the interest earnings.
(7) A sole practitioner
or principal real estate broker is not entitled to any part of any interest
earnings on trust funds deposited under subsection (5) of this section or to
any part of the earnest money or other money paid to the sole practitioner or
broker in connection with any real estate transaction as part or all of the
sole practitioner’s or broker’s commission or fee until the transaction has
been completed or terminated. The question of the disposition of forfeited
earnest money shall be negotiated between the sole practitioner or principal
real estate broker and the seller at the time of executing any listing
agreement or earnest money agreement. The result of such negotiation shall be
filled in on the agreement form at the time of signing by the seller and either
separately initialed by the seller or placed immediately above the signature of
the seller.
(8) Clients’ Trust
Account funds are not subject to execution or attachment on any claim against a
sole practitioner or principal real estate broker.
(9) No person shall
knowingly keep or cause to be kept any funds or money in any bank under the
heading of Clients’ Trust Account or any other name designating such funds or
money as belonging to the clients of any sole
practitioner or principal real estate broker, except actual trust funds
deposited with the sole practitioner or broker.
(10) The agency by rule
shall establish [a procedure for
disbursal of disputed funds] an optional procedure by which a sole
practitioner or a principal real estate broker may elect to disburse disputed
funds held in relation to the sale, exchange or purchase of real estate
from a Clients’ Trust Account to the person who delivered the funds to the sole
practitioner or principal real estate broker. The procedure shall allow disbursal
not more than 20 days after a request is made for the disbursal. [Any] A disbursal pursuant to the
procedure does not affect the claim of any other person to the funds.
(11) The agency may
provide by rules for other records to be maintained and for the manner in which
trust funds are deposited, held and disbursed.
SECTION 2. The Real Estate Agency shall adopt the rules
required by the amendments to ORS 696.241 by section 1 of this 2007 Act within
one year after the effective date of this 2007 Act.
Approved by the Governor May 30, 2007
Filed in the office of Secretary of State May 31, 2007
Effective date January 1, 2008
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