74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
Enrolled
Senate Bill 166
Printed pursuant to Senate Interim Rule 213.28 by order of the
President of the Senate in conformance with presession filing
rules, indicating neither advocacy nor opposition on the part
of the President (at the request of Governor Theodore R.
Kulongoski for Real Estate Agency)
CHAPTER ................
AN ACT
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 Oregon:
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
Enrolled Senate Bill 166 (SB 166-INTRO) Page 1
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. + }
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Enrolled Senate Bill 166 (SB 166-INTRO) Page 2
Passed by Senate February 12, 2007
...........................................................
Secretary of Senate
...........................................................
President of Senate
Passed by House May 7, 2007
...........................................................
Speaker of House
Enrolled Senate Bill 166 (SB 166-INTRO) Page 3
Received by Governor:
......M.,............., 2007
Approved:
......M.,............., 2007
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2007
...........................................................
Secretary of State
Enrolled Senate Bill 166 (SB 166-INTRO) Page 4