Twentieth Northern Marianas Commonwealth Legislature Real Estate Law.pdf · 6 § 100112. Salesman....

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Twentieth Northern Marianas Commonwealth Legislature IN THE HOUSE OF REPRESENTATIVES Session, 2017 ------ H.B. 20-"/ A BILL FOR AN ACT To establish a Real Estate Code in the Commonwealth to regulate the industry. BE IT ENACTED BY THE TWENTIETH NORTHERN MARIANAS COMMONWEAL TH LEGISLATURE: 1 Section 1. Findings. The economy of the Commonwealth is presently 2 enjoying a period of growth and it is clear that one of the most critical aspects of 3 the growing economy deals with real estate. While Article 12 of the CNMI 4 Constitution limits land alienation, the Legislature finds that there is a great deal 5 of land being bought and sold, leased and subleased. Presently, the real estate 6 industry is largely unchecked and unregulated. As to the industry, there are no 7 laws. No rules. No regulations. The time has come to establish a regulatory 8 framework to safeguard the industry and encourage honest real estate transactions. 9 Although development is positive and good, real estate laws must be established 10 to protect land owners and prospective buyers. 11 This legislation, pattered on the Guam real estate statutes that are close to 12 50 years old, offers the CNMI a practical and clear framework that is well- 13 established. 14 Section 1. Enactment. The following is hereby enacted subject to 15 codification by the Commonwealth Law Revision Commission:

Transcript of Twentieth Northern Marianas Commonwealth Legislature Real Estate Law.pdf · 6 § 100112. Salesman....

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Twentieth Northern Marianas Commonwealth Legislature

IN THE HOUSE OF REPRESENTATIVES

Session, 2017 ------ H.B. 20-"/

A BILL FOR AN ACT

To establish a Real Estate Code in the Commonwealth to regulate the industry.

BE IT ENACTED BY THE TWENTIETH NORTHERN MARIANAS COMMONWEAL TH LEGISLATURE:

1 Section 1. Findings. The economy of the Commonwealth is presently

2 enjoying a period of growth and it is clear that one of the most critical aspects of

3 the growing economy deals with real estate. While Article 12 of the CNMI

4 Constitution limits land alienation, the Legislature finds that there is a great deal

5 of land being bought and sold, leased and subleased. Presently, the real estate

6 industry is largely unchecked and unregulated. As to the industry, there are no

7 laws. No rules. No regulations. The time has come to establish a regulatory

8 framework to safeguard the industry and encourage honest real estate transactions.

9 Although development is positive and good, real estate laws must be established

10 to protect land owners and prospective buyers.

11 This legislation, pattered on the Guam real estate statutes that are close to

12 50 years old, offers the CNMI a practical and clear framework that is well-

13 established.

14 Section 1. Enactment. The following is hereby enacted subject to

15 codification by the Commonwealth Law Revision Commission:

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"CHAPTER 100 GENERAL PROVISIONS

§ 100101. Short Title.

§ 100102. Applicability of Definitions.

§ 100103. Commission.

§ 100104. Member.

§ 100105. Commissioner.

§ 100106. Department.

§ 100107. Person.

§ 100108. Provisions of this Division relating to Real Estate.

§ 100109. Provisions relating to Hearings.

§ 100110. Licensee.

§ 100111. Broker.

§ 100112. Salesman.

§ 100113. Real Estate Licensee.

§ 100114. Real Estate Broker.

§ 100115. Real Estate Salesman.

§ 100116. Advance Fee.

§ 100117. Listing.

§ 100101. Short Title. This Division may be cited as the Real Estate

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1 § 100102. Applicability of Definitions. The definitions in this Chapter

2 apply to the provisions of this Division only and do not affect any other provision

3 of this Code.

4 § 100103. Commission. Commission refers to the Real Estate

5 Commission.

6 § 100104. Member. Member refers to a member of the Real Estate

7 Commission.

8 § 100105. Commissioner. Commissioner refers to the Real Estate

9 Commissioner.

10 § 100106. Department. Department refers to the Department of

11 Commerce.

12 § 100107. Person. Person includes co-partnership, corporation, company

13 and firm.

14 § 100108. Provisions of this Division relating to Real Estate. Provisions

15 of this Title relating to real estate refers to the provisions of Chapters 100 [ this

16 Chapter -General Provisions], 102 [Administration], and 104 [Real Estate

17 Licenses] of this Division.

18 § 100109. Provisions relating to Hearings. Provisions of this Division

19 relating to hearings refers to the provisions of Article 3 of Chapter 102 of this

20 Title.

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1 § 100110. Licensee. 'Licensee, when used without modification, refers to a

2 person, whether broker or salesman, licensed under any of the provisions of this

3 Division.

4 § 100111. Broker. Broker, when used without modification, refers to a

5 person licensed as a broker under any of the provisions of this Division.

6 § 100112. Salesman. Salesman, when used without modification, refers to

7 a person licensed as a salesman under any of the provisions of this Division.

8 § 100113. Real Estate Licensee. Real Estate Licensee refers to a person,

9 whether broker or salesman, licensed under Chapter 104 (Real Estate Regulations)

10 of this Division.

11 § 100114. Real Estate Broker. Real Estate Broker refers to a person

12 licensed as a broker under Chapter 104 (Real Estate Regulations) of this Division.

13 § 100115. Real Estate Salesman. Real Estate Salesman refers to a person

14 licensed as a salesman under Chapter 104 (Real Estate Regulations) of this

15 Division.

16 § 100116. Advance Fee. The term Advance fee as used in this Division is

1 7 a fee claimed, demanded, charged, received, collected, or contracted for a listing,

18 advertisement, or offer to sell or lease property, other than in a newspaper of

19 general circulation, issued primarily for the purpose of promoting the sale or lease

20 of business opportunities or real estate or for referral to business opportunity or

21 real estate brokers or salesmen, or both, or soliciting borrowers or lenders for, or

22 to negotiate loans on, business opportunities or real estate.

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1 § 100117. Listing. The term listing as used in this Division includes, but

2 is not limited to:

3 (a) A name, or a list of the names, of the owners, landlords, exchangers, or

4 lessors, or the location or locations, or property, or of an interest in property,

5 offered for rent, sale, lease or exchange.

6 (b) A name, or a list of the names, or the location or locations at which

7 prospective or potential purchasers, buyers, lessees, tenants or changers of

8 property may be found or contacted.

9 ( c) An agreement by which a person who is engaged in the business of

10 promoting the sale or lease of business opportunities or real estate agrees to render

11 to an owner or lessee of such property any services, to promote the sale or lease of

12 said property.

13 ( d) An agreement by which a person who is engaged in the business of

14 finding, locating or promoting the sale or lease of business opportunities or real

15 estate, agrees to circularize, notify or refer business opportunities or real estate

16 brokers or salesmen, or both, to said property which is offered for sale or lease.

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CHAPTER 102 ADMINISTRATION

Article I.Real Estate Commission.

Article 2. Real Estate Commissioner.

Article 3.Hearings

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1 ARTICLE 1

2 REAL ESTATE COMMISSION

3 § 102101. Commissioner Designated.

4 § 102102. Commission Recognized; Number and Appointment of

5 Members

6 § 102103. Terms of Commissioners; vacancies.

7 § 102104. Qualifications of Appointees.

8 § 102105. Residence Requirements for Commissioners

9 § 102106. Compensation & Expenses.

10 § 102107. Meetings of the Commission: Place: Notice.

11 § 102108. Chairman of the Commission. [Reserved]

12 § 102109. Quorum; effect of vacancy; act of majority.

13 § 102110. Commission Meetings to be Open and Public Exception.

14 § 102111. Functions of Commission.

15 § 102112. Commission Records Open to Public Inspection.

16 § 102101. Commissioner Designated. The Director of Revenue &

17 Taxation is the Real Estate Commissioner. If there is no Director, the Secretary of

18 the Department of Commerce shall designate the Real Estate Commissioner.

19 § 102102. Commission Recognized; Number and Appointment of

20 Members. There is a Real Estate Commission which consists of seven (7)

21 members. All members of the Commission shall be appointed by the Governor by

22 and with the consent of the Legislature. The terms of the first three (3) members

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1 appointed after the effective date of this Act shall expire January 15, 2021. The

2 terms of other appointees shall be such terms as established by § 102103 of this

3 Chapter. The members shall elect from among their number a Chairman and a

4 Vice-Chairman.

5 § 102103. Terms of Commissioners; vacancies. Members of the

6 Commission shall be appointed for a term of four years and they shall hold office

7 until the appointment and qualification of their successors, the terms of the

8 members first appointed hereunder ( excluding the Commissioner) shall expire as

9 follows: one member, January 15, 2020; one member, January 15, 2021 ; and two

10 members, January 15, 2022. Vacancies from any cause shall be filled by the

11 Governor for the unexpired term.

12 § 102104. Qualifications of Appointees. Four (4) members of the

13 Commission shall be real estate brokers actively engaged in business in the

14 Commonwealth of the Northern Mariana Islands ("CNMI") for five (5) years.

15 One ( 1) member of the Commission shall be an attorney licensed to practice in the

16 CNMI. One ( 1) member of the Commission shall be chosen from the general

17 public. One (1) member of the Commission shall be designated by the Real Estate

18 Commissioner from among the classified employees of the Real Estate Licensing

19 Division of the Department of Revenue and Taxation and shall be the Executive

20 Secretary of the Commission.

21 § 102105. Residence Requirements for Commissioners. All members of

22 the Commission shall be residents of the CNMI as defined by law.

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§ 102106. Compensation & Expenses. Each member of the Commission,

except for the Commissioner, shall receive compensation at the rate of Fifty

Dollars ($50) per day for each day on which the Commission meets, such

compensation not to exceed One Hundred Dollars ($100) per month.

§ 102107. Meetings of the Commission: Place: Notice. The

Commission shall meet together for the transaction of business at least once each

quarter-year, but the Chairman may call a meeting of the Commission at his/her

discretion or upon written request of two or more members of the Commission.

Each meeting of the Commission shall be held only after notice of the time, date

and place of such meeting has been given to each Commission member.

§ 102108. Chairman of the Commission. [Reserved]

§ 102109. Quorum; effect of vacancy; act of majority. A majority of the

Commission constitutes a quorum for the transaction of any business, for the

performance of any duty, or for the exercise of any power or authority of the

Commission. A vacancy on the Commission does not impair the right of the

remaining members to perform all the duties and exercise all the power and

authority of the Commission. The act of the majority of the Commission, when in

session as a commission, is the act of the Commission.

§ 102110. Commission Meetings to be Open and Public: Exception.

All meetings of the Commission shall be open to the public, except that the

Commission may hold executive sessions to prepare, approve, grade or administer

examinations. The Commissioner shall assign a secretary who shall keep record of

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1 all the proceedings, transactions, communications and official acts of the

2 Commission; be custodian of all the records of the Commission; and perform such

3 other duties as the Commission may require.

4 § 102111. Functions of Commission. (a) The Commission may adopt

5 rules and regulations relating to the administration of but not inconsistent with the

6 provisions of this Division. (b) The Commission shall adopt a seal, which may be

7 either an engraved or ink stamp seal, with the words "Commonwealth of the

8 Northern Mariana Islands Real Estate Commission," and such device as the

9 Commission may desire included thereon, by which the acts of the Commission

10 shall be authenticated. Copies of all records and papers in the office of the

11 Commission, certified by the signature of the Chairman and the seal of the

12 Commission, shall be received in evidence in all cases equally and with like effect

13 as the originals. ( c) The Attorney General shall render to the CNMI Real Estate

14 Commission, opinions on all questions of law relating to the interpretation of this

15 Act or arising in the administration thereof, and shall act as attorney for the

16 Commission in all actions and proceedings brought by or against it under or

17 pursuant to any of the provisions of this Act. ( d) The Commission may make such

18 recommendation and suggestions of policy to the Commissioner as the

19 Commission deems beneficial and proper for the welfare and progress of the real

20 estate licensees and of the public and of the real estate business in the CNMI.

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1 § 102112. Commission Records Open to Public Inspection. All records

2 of the Commission shall be open to inspection by the public during regular office

3 hours, except as otherwise provided by law.

4 ARTICLE 2

5 REAL ESTATE COMMISSIONER

6 § 102201. Enforcement powers.

7 § 102202. Commissioner & Deputies May Not Act In Real Estate

8 Business.

9 § 102203. Seal: Use As Evidence. [Reserved]

1 O § 102204. Attorney General: Opinions, Advice. [Reserved]

11 § 102205. Rules & Regulations. [Reserved]

12 § 102206. Employment of Credit Reporting Agency.

13 § 102207. Injunctions Against Violations.

14 § 102208. Directory of Licensees.

15 § 102209. Bulletins: Other Regular Publications.

16 § 102210. Cease & Desist Order.

17 § 102211. Notice Of Violations: Withdrawal of Objections.

18 § 102212. Power of Commissioner to Require Advance Approval.

19 § 102201. Enforcement Powers. The Commissioner shall enforce the

20 provisions of this Division. He has full power to regulate and control the issuance

21 and revocation, both temporary and permanent, of all licenses to be issued under

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1 the provisions of this Division, and to perform all other acts and duties provided

2 in this Division and necessary for their enforcement.

3 § 102202. Commissioner & Deputies May Not Act In Real Estate

4 Business. After qualifying as such, neither the Commissioner nor any of the

5 deputies, or employees of the department shall be interested in any real estate

6 brokerage firm, as director, stockholder, officer, member, agent, or employee, or

7 act as a broker or salesman, or act as a copartner or agent for any broker or

8 brokers, salesman or salesmen.

9 § 102203. [Reserved]

10 § 102204. [Reserved]

11 § 102205. [Reserved]

12 § 102206. Employment of Credit Reporting Agency. The Commissioner

13 may secure a credit or investigation report of any applicant for a license under this

14 Division from an agency engaged in the business of furnishing credit reports.

15 § 102207. Injunctions Against Violations. Whenever the Commissioner

16 believes from evidence satisfactory to him that any person has violated or is about

17 to violate any of this Division, or any order, license, permit, decision, demand or

18 requirement, or any part or provision thereof he may bring an action in the name

19 of the people of the Commonwealth of the Northern Mariana Islands, in the

20 Superior Court of CNMI against such person to enjoin such person from

21 continuing such violation or engaging therein or doing any act or acts in

22 furtherance thereof. In this action an order or judgment may be entered awarding

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1 such preliminary or final injunction as may be proper, but no preliminary

2 injunction or temporary restraining order shall be granted without at least five

3 days' notice to the opposite party.

4 § 102208. Directory of Licensees. The Commissioner may publish or

5 cause to be published at appropriate intervals a directory or list of licensed brokers

6 and salesmen and may publish therewith such matter as he may deem pertinent to

7 this Division. He shall furnish one copy of such director to each licensed broker

8 upon his request and payment of an appropriate charge based upon cost of

9 publication. Such directory may contain copies of this Division, other applicable

10 territorial laws, and the Rules and Regulations of the Real Estate Commissioner.

11 § 102209. Bulletins: Other Regular Publications. The Commissioner

12 may periodically issue a bulletin continuing matter relating to the provisions of

13 this Division, and the administration thereof, and may publish the same character

14 of matter in any established periodical published in the CNMI which in his

15 opinion would be most likely to disseminate such matter and information to

16 licensees under this Division.

17 § 102210. Cease & Desist Order. Whenever in the opm10n of the

18 Commissioner any person has or is violating, or is about to violate, any of the

19 provisions of this Division, the Commissioner may order the person to desist and

20 refrain from doing so. If, after such order is made, a request for hearing is filed in

21 writing and hearing is not held within sixty (60) days thereafter, the order is

22 rescinded.

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1 § 102211. Notice of Violations: Withdrawal of Objections.

2 No person shall engage in any activity after receiving a notice in writing

3 from the Commissioner that in the opinion of the Commissioner such activity

4 violates a provision of this Division, unless the Commissioner subsequently, in

5 writing, withdraws his objections to the activity.

6 § 102212. Power of Commissioner to Require Advance Approval. The

7 Commissioner may require that any or all materials used in obtaining advance fee

8 agreements, including but not limited to the contract forms, letters or cards used to

9 solicit prospective sellers, and radio, newspaper, and television advertising be

10 submitted to him at least five days before they are used. Should the Commissioner

11 determine that any matter, when used alone or with any other matter, would tend

12 to mislead, he may within five days of the date he receives same, order that it not

13 be used, disseminated, nor published. Any person using, disseminating, or

14 publishing any matter which the Commissioner has ordered, pursuant to this

15 Section, not be used, published or disseminated shall be guilty of a petty

16 misdemeanor. The Commissioner may determine the form of the advance fee

1 7 agreements, and all material used in soliciting prospective owners and sellers shall

18 be used in the form and manner which he determines is necessary to carry out the

19 purposes and intent of this Division. Any violation of any of the provisions of this

20 Division or of the rules, regulations, orders or requirements of the Commissioner

21 thereunder shall constitute grounds for disciplinary action against a licensee, or for

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1 proceedings under this Section, or both. The sanctions are in addition to the

2 criminal proceedings hereinbefore provided.

3 ARTICLE 3

4 HEARINGS

5 § 102301. Prescribed Procedure: Powers of Commissioner.

6 § 102302. Time for Filing Accusation.

7 § 102303. Proceeding with Investigation After Lapse or Suspension.

8 § 102304. Transcript of Papers: Demand: Fees.

9 § 102301. Prescribed Procedure: Powers of Commissioner. Before

10 denying, suspending, or revoking any license issuable or issued under the

11 provisions of this Division, the Commissioner shall proceed as prescribed by the

12 Administrative Adjudication Law, and the Commissioner shall have all the

13 powers granted therein.

14 § 102302. Time for Filing Accusation. The accusation provided for by

15 the relevant provisions shall be filed not later than three years from the occurrence

16 of the grounds for revocation or suspension with which the respondent is charged.

17 § 102303. Proceeding with Investigation After Lapse or Suspension.

18 The lapsing or suspension of a license by operation of law or by order or decision

19 of the Commissioner or a court of law, or the voluntary surrender of a license by a

20 licensee shall not deprive the Commissioner of jurisdiction to proceed with any

21 investigation or action or disciplinary proceeding against such licensee, or to

22 render a decision suspending or revoking such license.

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1 § 102304. Transcript of Papers: Demand: Fees. Any party aggrieved by

2 the decision of the Commissioner may make a demand in writing for a certified

3 transcript of all the papers on file in his office affecting or relating to such

4 decision and all the evidence taken on the hearing. The fee for a certified

5 transcript is twenty-five cents ($0.25) per page.

6 CHAPTER 104

7 REAL ESTATE REGULATIONS

8 ARTICLE 1

9 SCOPE OF REGULATIONS

10 § 104101. Engaging In Business or Acting without License:

11 Enforcement.

12 § 104102. Real Estate Broker Defined.

13 § 104103. Real Estate Salesman Defined.

14 § 104104. Real Estate Salesman Further Defined.

15 § 104105. Division Inapplicable to Persons Dealing with Persons Own

16 Property.

17 § 104106. One Act Constitute Doing Business as Licensee.

18 §104107. One Act: Securing Promissory Notes.

19 § 104108. Lease or Leasing Includes Any Lease.

20 § 104109. Proof Needed Before Bringing Action for Compensation.

21 § 104110. Employment of Unlicensed Persons Prohibited.

22 § 104111. Paying or Compensating Person Not a Licensee.

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1 § 104112. Acting as Broker or Salesman without License: Punishment.

2 § 104113. Publication of False Statement: Prohibited.

3 § 104114. Requirements of Publications of Offerings, etc.

4 § 104115. Information to Seller & Purchaser.

5 § 104116. Delivery of Agreement of Authority.

6 § 104117. Rental or Rental Information.

7 § 104118. Report on Assistance to Licensees in Filing Applications for

8 Territorial or Federal Lands.

9 § 104119. Power of Commissioner to Prescribe Information in

10 Assistance Agreements.

11 § 104120. Trust Accounts.

12 § 104121. Trust Accounts: Penalty.

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14 § 104101. Engaging In Business or Acting without License:

15 Enforcement. It is unlawful for any person to engage in the business, act in the

16 capacity of, advertise or assume to act as a real estate broker or a real estate

1 7 salesman within the CNMI without first obtaining a real estate license from the

18 Department. The Commissioner may prefer a complaint for a violation of this

19 Section before the Superior Court, and the Commissioner and deputies or

20 assistants may assist in presenting the facts at the trial. It is the duty of the

21 Attorney General to prosecute all violations of this Section.

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1 § 104102. Real Estate Broker Defined. (a) Broker means an individual,

2 other than a salesman, who, for another and for compensation:

3 ( 1) Sells, exchanges, purchases, rents or leases real estate;

4 (2) Offers to sell, exchange, purchase rent or lease real estate;

5 (3) Negotiates, offers, attempts or agrees to negotiate the sale, exchange,

6 purchase, rental or leasing of real estate;

7 ( 4) Lists, offers, attempts or agrees to list real estate for sale, lease or

8 exchange; (5) Auctions, offers, attempts or agrees to auction real estate;

9 ( 6) Buys, sells, offers to buy or sell or otherwise deals in options on real

10 estate;

11 (7) Collects, offers, attempts or agrees to collect rent for the use of real

12 estate;

13 (8) Advertises or holds himself out as being engaged in the business of

14 buying, selling, exchanging, renting or leasing real estate;

15 (9) Assists or directs in the procuring of prospects calculated to result in

16 the sale, exchange, leasing or rental of real estate;

1 7 ( 10) Assists or directs in the negotiation of any transaction calculated or

18 intended to result in the sale, exchange, leasing or rental of real estate;

19 ( 11) Engages in the business of charging an advance fee in connection

20 with any contract whereby he undertakes to promote the sale of real estate either

21 through its listing in a publication issued for such purpose or for referral of

22 information concerning such real estate to brokers or both;

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1 (12) Assists or directs in the procurement of, or arrangement for, mortgage

2 financing on real property while not acting in the capacity of a licensed mortgagee

3 or his agent, or of a mortgagee or his agent who is authorized to make real

4 property loans under state or Federal authority and supervision;

5 (13) Performing any of the foregoing acts as an employee of, or on behalf

6 of, the owner of real estate, or interest therein, or improvements affixed thereon,

7 for compensation.

8 (b) After the effective date of this Act, it shall be unlawful for any person,

9 directly or indirectly, to engage in or conduct, or to advertise or hold himself out

10 as engaging in or conducting the business or acting in the capacity of a real estate

11 broker, associate broker or real estate salesman within the CNMI without first

12 obtaining a license as such broker, associate broker or salesman, as provided in

13 this Act, unless he is exempted from obtaining a license under Subsection ( d) of

14 this Section. (c) Any person who, directly or indirectly for another, with the

15 intention or upon the promise of receiving any valuable consideration, offers,

16 attempts or agrees to perform, or performs any single act described in Subsection

17 (a) of this Chapter, whether as a part of a transaction, or as an entire transaction,

18 shall be deemed a broker, associate broker or salesman within the meaning of this

19 Division. The commission of a single such act by a person required to be licensed

20 under this Division and not so licensed shall constitute a violation of this

21 Division. ( d) Except as to the requirements with respect to the subdivision of land,

22 the provisions of this Division shall not apply to:

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1 ( 1) Any person, partnership or corporation who as owner or lessor shall

2 perform any of the acts described in Subsection (a) of this Act with reference to

3 property owned or leased by them, or to the regular employees thereof, with

4 respect to the property so owned or leased, where such acts are performed in the

5 regular course of or as an incident to the management, sale or other disposition of

6 such property and the investment therein; provided, that such regular employees

7 shall not perform any of the acts described in Subsection (a) of this Act in

8 connection with a vocation of selling or leasing any real estate or the

9 improvements thereon; provided, that this provision shall not apply to any person,

10 partnership or corporation in the business of purchasing unimproved land for

11 development and subdivision purposes; (2) An attorney in fact under a duly

12 executed and recorded power of attorney to convey real estate from the owner or

13 lessor or the services rendered by any attorney- at-law in the performance of his

14 duty as such attorney at law; (3) Any person acting as receiver, trustee in

15 bankruptcy, administrator, executor or guardian, or while acting under a court

16 order or under the authority of a will or of a trust instrument; (4) Any person

1 7 acting as the resident manager for the owner or an employee acting as the resident

18 manager for a broker managing an apartment building, duplex, apartment complex

19 or court, when such resident manager resides on the premises and is engaged in

20 the leasing of property in connection with his employment; (5) Any officer or

21 employee of a Federal agency in the conduct of his official duties; ( 6) Any officer

22 or employee of the CNMI government or any political subdivision thereof

23 performing his official duties; (7) Any multiple listing service wholly owned by a - 19 -

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1 non-profit organization or association or real estate brokers; (8) Any non-profit

2 referral system or organization of real estate brokers for the purpose of referrals of

3 prospects for the sale or listing of real estate.

4 § 104104. Real Estate Salesman Further Defined. A real estate salesman

5 within the meaning of this Division includes a natural person who for

6 compensation is employed by a licensed real estate broker to sell a promissory

7 note secured by a lien on real property, unless such note is sold to an underwriter

8 or is one of a series of notes.

9 § 104105. Division Inapplicable to Persons Dealing with Person's Own

10 Property. Anyone who directly performs any of the acts within the scope of this

11 Division with reference to his own property or, in the case of a corporation which,

12 through its regular officers receiving no special compensation therefor, performs

13 any of the acts with reference to the corporation's own property. The exemption

14 granted hereunder shall not however, extend to any person, natural or legal, who is

15 engaged in the buying, selling, leasing or development of real property of its own.

16 Such a person shall be subject to all applicable provisions of this Division.

17 § 104106. One Act Constitute Doing Business as Licensee.

18 One act of buying or selling real estate of or for another for a

19 compensation or in expectation of a compensation, or offering for another to buy

20 or sell or exchange real estate, or negotiating the purchase or sale or exchange of,

21 or listing or soliciting prospective purchasers ofreal estate, or soliciting borrowers

22 or lenders for or negotiating a loan on or leasing or renting or placing for rent real

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1 estate, or collecting rent therefrom, or, as other than an officer or employee of the

2 CNMI or Federal Government, assisting or offering to assist another or others, for

3 compensation or in expectation of compensation, in filing an application for the

4 purchase or lease of, or in locating or entering upon, lands owned by the CNMI or

5 Federal Government, constitutes the person performing such act a real estate

6 broker or real estate salesman within the meaning of this Division.

7 § 104107. One Act: Securing Promissory Notes. One act, for a

8 compensation, of selling or offering to sell, buying or offering to buy, or

9 negotiating the purchase or sale or exchange of a promissory note secured by a

10 lien on real property, when such note is not sold to an underwriter or is not one of

11 a series of notes, constitutes the person making such offer, sale, purchase or

12 exchange a real estate broker or real estate salesman within the meaning of this

13 Division.

14 § 104108. Lease or Leasing Includes Any Lease. When a lease or

15 leasing is referred to in this Article, it includes any lease, whether such lease is the

16 sole transaction involved, or the principal or an incidental part of the transaction

1 7 involved.

18 § 104109. Proof Needed Before Bringing Action for Compensation. No

19 person engaged in the business or acting in the capacity of a real estate broker or a

20 real estate salesman within the CNMI shall bring or maintain any action in the

21 courts of The CNMI for the collection of compensation for the performance of

22 any of the acts mentioned in this Article without alleging and proving that he was

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1 a duly licensed real estate broker or real estate salesman at the time the alleged

2 cause of action arose.

3 § 104110. Employment of Unlicensed Persons Prohibited. It is unlawful

4 for any licensed real estate broker to employ or compensate, directly or indirectly,

5 any person for performing any of the acts within the scope of this Chapter who is

6 not a licensed real estate broker, or a real estate salesman licensed under the

7 broker employing or compensating him; provided, however, that a licensed real

8 estate broker may pay a commission to a broker or another territory or state. No

9 real estate salesman shall be employed by or accept compensation from any

10 person other than the broker under whom he is at the time licensed. It is unlawful

11 for any licensed real estate salesman to pay any compensation for performing any

12 of the acts within the scope of this Chapter to any real estate licensee except

13 through the broker under whom he is at the time licensed. For a violation of any of

14 the provisions of this section, the Commissioner may temporarily suspend or

15 permanently revoke the license of the real estate licensee, in accordance with the

16 provisions of this Division relating to hearings.

17 § 104111. Paying or Compensating Person Not a Licensee. It is a

18 violation, punishable by a fine of not exceeding $50 for each offense, for any

19 person whether obligor, escrow holder or otherwise, to pay or deliver to anyone a

20 compensation for performing any of the acts within the scope of this Chapter, who

21 is not known to be or who does not present evidence to such payer that he is a

22 regularly licensed real estate broker at the time such compensation is earned. For

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1 violation of any of the prov1s10ns of this section, the Commissioner may

2 temporarily suspend or permanently revoke the license of the real estate licensee

3 in accordance with the provisions of this Division relating to Hearings.

4 § 104112. Acting as Broker or Salesman without License: Punishment.

5 Any person acting as a real estate broker or real estate salesman without a license

6 or who advertises using words indicating that he is a real estate broker without

7 being so licensed shall, upon conviction thereof, if a natural person, be guilty of a

8 petty misdemeanor; or if a corporation, be guilty of a violation and subject to a

9 fine not to exceed Five Thousand Dollars ($5,000).

10 § 104113. Publication of False Statement: Prohibited. Every officer,

11 agent or employee of any company, and every other person who knowingly

12 authorizes, directs or aids in the publication, advertisement, distribution or

13 circularization of any false statement or representation concerning any land or

14 subdivision thereof, offered for sale or lease, or, if the land is owned by the CNMI

15 or Federal government, which such person offers to assist another or others to file

16 an application for the purchase or lease of, or to locate or enter upon, and every

17 person who, with knowledge that any advertisement, pamphlet, prospectus or

18 letter concerning any said land or subdivision, contains any written statement that

19 is false or fraudulent, issues, circulates, publishes or distributes the same, or

20 causes the same to be issued, circulated, published or distributed, or who, in any

21 other respect, willfully violates or fails to comply with any of the provisions of

22 this Section, or who in any other respect willfully violates or fails, omits or

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1 neglects to obey, observe or comply with any order, permit, decision, demand or

2 requirement of the Commissioner under this Section, is guilty of a felony, and

3 shall be punished by a fine not exceeding Twenty Five Thousand Dollars

4 ($25,000), or by imprisonment, and, if a real estate licensee, he shall be given a

5 hearing by a Commissioner for a suspension or revocation of his license, as

6 provided in the provisions of this Title relating to hearings. The Attorney General

7 shall prosecute all violations of the provisions of this Section.

8 § 104114. Requirements of Publications of Offerings, etc. Each

9 advertisement or other statement which is published by a real estate broker or

10 salesman offering to assist persons to file applications for the purchase or lease of,

11 or to locate or to enter upon, lands owned by the CNMI or Federal Government

12 shall, when published, indicate the name of the broker for whom it is published

13 and state that he is licensed as a real estate broker by the CNMI.

14 § 104115. Information to Seller & Purchaser.

15 Within one month after the closing of a transaction in which title to real

16 property is conveyed from a seller to a purchaser through a licensed real estate

1 7 broker, such broker shall inform or cause the information to be given to the seller

18 and purchaser in writing of the selling price thereof and in the event an exchange

19 or real property is involved, such information shall include a description of said

20 !property and amount of added money consideration, if any. If the transaction is

21 closed through escrow and the escrow holder renders a closing statement which

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1 reveals such information, that shall be deemed compliance with this section on the

2 part of the broker.

3

4 § 104116. Delivery of Agreement of Authority. When a licensee

5 prepares or has prepared an agreement authorizing or employing such licensee to

6 perform any of the acts for which he is required to hold a license, or when such

7 licensee secures the signature of any person to any contract pertaining to such

8 services or transactions, he shall deliver a copy of the agreement to the person

9 signing it at the time the signature is obtained.

10

11 § 104117. Rental or Rental Information. Every real estate licensee who

12 attempts to negotiate a rental or who furnishes rental information to a prospective

13 tenant for a fee paid by said prospective tenant shall give every such prospective

14 tenant a contract or receipt, and in such contract or receipt shall undertake to repay

15 any amount over and above the sum of $10.00 service charge to the prospective

16 tenant if the prospective tenant does not obtain a rental. A demand from the

1 7 prospective tenant for the return of the fee, or any part of it, shall be made within

18 10 days following the final day on which the real estate licensee has contracted to

19 !Perform services to the prospective tenant. In the event that rental information is

20 not current or accurate in regard to the type of rental desired, the full fee shall be

21 repaid to the tenant. Such contract or receipt shall also conform to the regulations

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I 1 adopted by the Commissioner in order to effect disclosure of material information

2 regarding the service to be provided to the prospective tenant.

3 § 104118. Report on Assistance to Licensees in Filing Applications for

4 Territorial or Federal Lands.

5 Any real estate broker who assists another or others, or whose real estate

6 salesmen assist another or others, for a compensation, in filing an application for

7 the purchase or lease of, or in locating or entering upon, lands owned by the

8 CNMI or Federal Government shall report to the Commissioner the names and

9 addresses of all persons he or his salesmen have assisted in filing applications for

10 land owned by the CNMI or Federal Government and the amount of

11 compensation received from such persons. The report shall be filed quarterly

12 within 10 days after the end of each calendar quarter.

13

14 § 104119. Power of Commissioner to Prescribe Information in

15 Assistance Agreements. The Commissioner may prescribe by regulation the

16 information which shall be contained in contracts or other agreements by a real

17 estate broker, or a real estate salesman, to assist another or others in filing an

18 application for the purchase or lease of, or in locating or entering upon, lands

19 owned by the CNMI or Federal Government, including, but not limited to,

20 information with regard to the services agreed to be performed and information

21 with regard to the hazards which may prevent the person to be assisted in filing an

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I 1

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application with the CNMI or Federal Government from ever receiving any CNMI

or Federal Land under the application.

4 § 104120. Trust Accounts.

5 (a) Each broker shall maintain a separate bank checking account in the

6 CNMI which shall be designated a trust account in which all down payments,

7 earnest money deposits, or other trust funds received by him, his associate brokers

8 or his salesmen on behalf of his principal or any other person shall be deposited.

9 (b) Each broker shall notify the Commissioner of the name of the bank or

10 banks in which the trust account is maintained and also the name of the account

11 on forms provided therefore.

12 (c) Each broker shall authorize the Commissioner to examine such trust

13 account by a duly authorized representative of the Commissioner.

14 Such examination shall be made at such times as the Commissioner may

15 direct.

16 ( d) A broker may maintain more than one trust account if the Commission

17 is advised of such account as required in Subsection (b) of this Section. ( e) In the

18 event a branch office maintains a separate trust account, a separate bookkeeping

19 system shall be maintained by the branch office. (f) A broker shall not be entitled

20 to any part of the earnest money or other money paid to him in connection with

21 any real estate transaction as part or all of his commission or fee until the

22 transaction has been consummated or terminated, unless agreed in writing by all

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1 § 104121. Trust Accounts: Penalty. Each broker, associate broker, or

2 salesman that violates the provisions of§ 104120 of this Chapter, or commingles

3 funds that should be in trust funds with other funds , or fails to deposit into a trust

4 account any down payment, earnest money deposit, or other funds that should be

5 held within a trust account, shall pay a penalty of One Hundred Dollars ($100.00)

6 for each violation.

7

8 ARTICLE 2

9 REAL ESTATE LICENSES

10 § 104201. Broker's License Application.

11 § 104202. Original Licenses to U.S. Citizens Only.

12 § 104203. Condition Precedent to Issuance of Original Real Estate

13 Broker's License.

14 § 103204. Application for Salesman's License.

15 § 104205. Requirement of Other Proof Before Authorizing License;

16 Hearing.

17 § 104206. Written Examination.

18 § 104207. Original Real Estate Licenses: Term.

19 § 104208. Continuing Education Requirement for Broker's Renewal

20 § 104209. Continuing Education Requirement for Salesperson

21 Renewal.

22 § 104210. [Reserved].

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1 § 104211. Substitution of Continuing Education Requirement.

2 § 104212. Limited Real Estate Salesman's License: Issuance:

3 Requirements. §104213. Same: Rights and Limitations Under Limited

4 License.

5 § 104214. Waiver of Examination.

6 § 104215. Right to Continue Operating Under Existing License.

7 § 104216. Persons to Whom Issuance of Restricted License Is

8 Authorized.

9 § 104217. Same: Methods of Restriction.

10 § 104218. Same: Rights Conferred: Revocation: Necessity Forbearing.

11 § 104219. Same: Requiring Filing of Bond.

12 § 104220. License Authority Limited to Persons Licensed.

13 § 104221. Corporation and Partnership Licenses.

14 § 104222. Same: Officer or Member Licensed Only to Act for

15 Corporation or Partnership. § 104223. Issuance of License Under Fictitious

16 Name.

17 § 104224. Display and Possession of Licenses.

18 § 104225. Return and Cancellation of Salesman's License Upon

19 withdrawal from Broker's Employ: Reinstatement.

20 § 104226. Reinstatement of License After End of Service In Public

21 Office.

22 § 104227. Inactivation of License.

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1 § 104229. Additional Licenses for Branch Offices.

2 § 104230. Signs: Requirement for: Regulations.

3 § 104231. Suspension or Revocation of License for Violation of

4 Provisions.

5 § 104201. Broker's License Application. Application for license as a real

6 estate broker shall be made in writing to the Commissioner. The application shall

7 be accompanied by the original real estate broker's license fee and by the

8 recommendation of two real estate owners on The CNMI, certifying that the

9 applicant is honest, truthful and of good reputation, and recommending that a real

10 estate broker's license be granted to him.

11 § 104202. Original Licenses to U.S. Citizens Only. The Commissioner

12 shall not grant an original real estate broker=s license to any person who is not a

13 citizen of the United States. This section shall not affect the rights of a non-citizen

14 now (6/30/72) holding a real estate broker=s license to renewal or reinstatement of

15 his license in accordance with the provisions of this Chapter.

16 § 104203. Condition Precedent to Issuance of Original Real Estate

17 Broker's License. The Real Estate Commission shall not issue a real estate

18 broker's license to any person who has not held an original real estate salesman's

19 license for at least two (2) years prior to the date of his application for the broker's

20 license, and during such time was not actively engaged in the business of real

21 estate salesman on The CNMI and has not passed the appropriate examination and

22 satisfied the other requirements of the Article.

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1 § 104204. Application for Salesman's License. Application for License

2 As a Real Estate Salesman Shall Be Made In Writing to the Commissioner.

3 The applications shall be signed by the applicant, and shall be accompanied by the

4 real estate salesman=s license fee; and by the recommendation of the broker, who

5 is to be the applicant's employer, certifying that the applicant is honest, truthful

6 and of good reputation and evidence of satisfactory completion of the basic real

7 estate fundamental course prescribed and approved by the Commissioner, of at

8 least thirty (30) classroom hours, or its equivalent.

9 § 104205. Requirement of Other Proof Before Authorizing License;

1 O Hearing. The Commissioner may require such other proof as the Commissioner

11 may deem advisable concerning the honesty, truthfulness and good reputation of

12 any applicant for a real estate license, or of the officers of any corporation, or of

13 the members of any co-partnership making such application, before authorizing

14 the issuance of a real estate license. For this purpose the Commissioner may call

15 a hearing in accordance with the provisions of this Division relating to hearings.

16 § 104206. Written Examination. In addition to the proof of honesty,

17 truthfulness and good reputation required of any applicant for a real estate license,

18 the Commissioner shall ascertain by written examination that the applicant, and in

19 case of a co-partnership or corporation applicant, for a real estate broker's license

20 that each officer, agent or member thereof through whom it proposes to act as a

21 real estate licensee, has: (a) appropriate knowledge of the English language,

22 including reading, writing, and spelling and of elementary arithmetic; (b) a fair

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1 understanding of the rudimentary principles of real estate conveyancing, the

2 general purposes and general legal effects of deeds, mortgages, land contracts of

3 sale and leases, and of the elementary principles of land economics and appraisals;

4 ( c) a general and fair understanding of the obligations between principal and

5 agent, of the principles of real estate practice and the canons of business ethics

6 pertaining thereto, as well as the relevant provision of the CNMI Constitution and

7 the CNMI Covenant, relating to real estate; and ( d) have satisfactorily completed a

8 real estate course prescribed and approved by the Commissioner of at least thirty

9 (30) classroom hours, or its equivalent, of instructions in a real estate school

10 certified by the Commissioner.

11 § 104207. Original Real Estate License Term. All original real estate

12 licenses issued by the Commissioner shall be for a period of two (2) years and the

13 holder thereof shall not become eligible for a renewal real estate license until one

14 has successfully completed the Continuing Education Requirement outlined in §

15 104209 of this Chapter.

16 § 104208. Continuing Education Requirement for Broker's Renewal.

17 (a) Any time prior to renewal of an original broker's license, the broker must

18 satisfactorily furnish the evidence of successful completion of an additional ninety

19 (90) classroom hours of study selected among the following: (1) real estate

20 practice; (2) real estate appraisal; .(3) property management; (4) real estate finance;

21 ( 5) legal aspect of real estate; ( 6) real estate office administration; (7) general

22 accounting; (8) business law; (9) escrow; (10) real estate contracts; or (11) any

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1 real estate-oriented study area. (b) Of the ninety (90) classroom hours, eighteen

2 ( 18) classroom hours must be in the consumer protection area of study: ( 1) land

3 use regulation; (2) consumer disclosure; (3) agency relationship; (4) fair practices;

4 (5) environmental regulation and considerations; (6) taxation (real estate

5 transaction); and (7) probate. (c) Thereafter, all brokers' renewal shall be for a

6 period of four (4) years, with a continuing education requirement of sixteen (16)

7 hours every two (2) years. Should the broker acquire more than the sixteen (16)

8 hours during the two (2) year period, the excess hours may be credited to future

9 renewal requirements. ( d) Any of the ninety (90) classroom hours of study as

10 outlined in this Section may be fulfilled by the completion of courses approved by

11 the CNMI Association of Realtors.

12 § 104209. Continuing Education Requirement for Salesperson

13 Renewal. Any time prior to renewal of an original license the salesperson must

14 satisfactorily furnish evidence of successful completion of an additional forty-five

15 (45) classroom hours of study in§ 104208 (a)(l) or (2). Thereafter, all salesperson

16 renewals should be for a period of four (4) years with a continuing education ,

17 requirement of twelve (12) hours every two (2) years. Should a salesperson

18 acquire more than the minimum of twelve (12) hours during the two (2) year

19 period, the excess hours may be credited to future renewal requirements.

20 § 104210. Reserved.

21 § 104211. Substitution of Continuing Education Requirement. The

22 Real Estate Commissioner may allow for substitution of the clock hour

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1 requirements, if the Commissioner makes a determination that the individual is

2 otherwise and similarly qualified by reason of completion of equivalent

3 educational coursework in any accredited institution of higher learning or any

4 degree granting accredited institution.

5 § 104212. Limited Real Estate Salesman's License: Issuance:

6 Requirements. Upon the making of a written application and the payment of the

7 fee for a limited real estate salesman's license, the Commissioner may issue the

8 license to the applicant before completing his investigation into the applicant's

9 honesty. truthfulness and good reputation when the applicant has demonstrated by

10 written examination that he has (i) appropriate knowledge of the English

11 language, including reading, writing and spelling, and of elementary arithmetic,

12 and (ii) a fair understanding of the obligations between principal and agent and the

13 provisions of this Division relating to real estate.

14 § 104213. Same: Rights and Limitations Under Limited License.

15 A limited real estate salesman's license does not confer any property right in the

16 privileges to be exercised thereunder, and the Commissioner may revoke or

1 7 suspend such license without a hearing. Such license shall be issued for a period

18 not to exceed one hundred twenty (120) days. Such license shall not be renewed;

19 and it shall not be transferred without the consent of the Commissioner. The

20 holder of a limited real estate salesman's license may not sign any contract or

21 agreement on behalf of the broker with whom he is employed.

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§ 104214. Waiver of Examination. The Commissioner may, in his

discretion, waive the examination of any applicant for a real estate broker's license

who held an unrevoked or unsuspended renewal real estate broker's license, within

the one-year period immediately preceding the date of the application for such

renewal license, as individual broker, an officer of a corporation or a member of a

co-partnership. The Commissioner may, in his discretion, waive the examination

of any applicant for a real estate salesman's license who held an unrevoked or

unsuspended renewal real estate salesman's license, within the one-year period

immediately preceding the date of the application for such renewal license.

§ 104215. Right to Continue Operating Under Existing License. An

application on the form prescribed by the Commissioner for the renewal of a

license, filed before midnight of the last day of the period for which a previous

renewal license was issued, or midnight of the expiration date of an original

license under which the bolder has been notified that he is eligible for a renewal

license, accompanied by the applicable renewal fee, entitles the applicant to

continue operating under his existing license after its specified expiration date, if

not previously suspended or revoked, and until such date as he is notified m

writing that the application has been granted or denied.

§ 104216. Persons to Whom Issuance of Restricted License Is

1

Authorized. The Commissioner may issue a restricted license to a person who is

applying for a license under this Chapter, who has met the examination and

experience requirements, but who has been found by the Commissioner after a

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hearing not to have made a satisfactory showing that be meets all of the other

requirements for the license applied for, where such failure would justify the

denial of the license applied for.

§ 104217. Same: Methods of Restriction. A restricted license issued

pursuant to § 104216 as the Commissioner in his discretion finds advisable in the

public interest may be restricted: (a) By term. (b) To employment by a particular

real estate broker, if a salesman. ( c) By conditions to be observed in the exercise

of the privileges granted.

§ 104218. Same: Rights Conferred: Revocation: Necessity Forbearing.

A restricted license issued pursuant to § 104216 does not confer any property right

in the privileges to be exercised thereunder, and the bolder of a restricted license

does not have the right to renewal of such license. The Commissioner may

without hearing issue an order suspending the licensee's right to further exercise

any privileges granted under a restricted license pending final determination made

after formal hearing.

§ 104219. Same: Requiring Filing of Bond. As one of the conditions to

the issuance of a restricted license authorized by § 104216 the Commissioner may

1require the filing of surety bonds in such form and condition as be may require in

f espect to the restricted licensee for the protection of persons or classes of persons

!with whom said licensee may deal.

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1 § 104220. License Authority Limited to Persons Licensed. No real

2 estate license gives authority to do any act specified in this Chapter to any person,

3 other than the person to whom the license is issued.

4 § 104221. Corporation and Partnership Licenses. When a real estate

5 license is issued to a corporation, if it desires any of its officers other than the

6 officer designated by it, to act under its license as a real estate broker, it shall

7 procure an additional license to so employ each of such additional officers. When

8 a real estate license is granted to a co-partnership, if it desires any of its members

9 other than the one or ones through whom it is already licensed to act as a real

10 estate broker, it shall procure an additional license to so employ each of such

11 additional members.

12 § 104222. Same: Officer or Member Licensed Only to Act for

13 Corporation or Partnership. Each officer of a corporation through whom it is

14 licensed to act as a real estate broker, and each member of a co-partnership

15 through whom it is licensed to act as a real estate broker, is, while so employed

16 under such license, a licensed real estate broker, but licensed only to act as such

17 for and on behalf of the corporation or the co-partnership, as officer or member,

18 respectively.

19 § 104223. Issuance of License Under Fictitious Name. Every person

20 applying for a license under this Chapter who desires to have such license issued

21 under a fictitious name shall file with his application a certified copy of the entry

22 of the Director made pursuant to the applicable provisions.

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1 § 104224. Display and Possession of Licenses. The real estate licenses of

2 both broker and salesman shall be prominently displayed in the office of the real

3 estate broker.

4 The real estate salesman's license shall remain in the possession of the

5 licensed real estate broker employer until canceled or until the salesman leaves the

6 employ of the broker.

7 § 104225. Return and Cancellation of Salesman's License Upon

8 Withdrawal From Broker's Employ: Reinstatement. Immediately upon the

9 real estate salesman's withdrawal from the employ of the real estate broker, the

10 real estate broker shall return the real estate salesman's license to the

11 Commissioner for cancellation. A license canceled but not suspended or revoked

12 may be reinstated at any time during the period for which the license was issued,

13 upon receipt of application therefor and the fee for the reinstatement of his

14 license.

15 § 104226. Reinstatement of License After End of Service In Public

16 Office. When the holder of a real estate broker's or salesman's license relinquishes

17 his license to assume an office in the territorial or Federal government, he may

18 have it reinstated at any time within six (6) months of termination of his service in

19 !office upon payment of the appropriate renewal fee.

20 § 104227. Inactivation of License. A licensed real estate broker or

21 salesman may request that his license be inactivated. The Commissioner shall

22 thereupon issue to such person an inactive license certificate. This inactive license

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1 certificate may consist of the license itself with an endorsement stating that it is

2 inactive and does not permit the holder to transact business under it. An inactive

3 license which is not suspended or revoked may be reinstated at any time during

4 the period for which the license was issued, and may he renewed each four ( 4)

5 year period upon the making of application therefor and the payment of the

6 appropriate fee. The holder of an inactive broker license need not maintain a place

7 of business or a sign as required by 104228 and 104230. The holder of an inactive

8 license shall not be entitled to act in any capacity for which the license is required

9 until the license has been reinstated.

10 § 104228. Maintenance of Place of Business. Every licensed real estate

11 broker shall have and maintain a definite place of business in the CNMI which

12 shall serve as his office for the transaction of business. This office shall be the

13 place where his license is displayed and where personal consultations with clients

14 are held. Notice in writing shall be given the Commissioner of change of business

15 location of a real estate broker, whereupon the Commissioner shall issue a new

16 license for the unexpired period. No real estate license authorizes the licensee to

1 7 do business except from the location stipulated in the real estate license.

18 § 104229. Additional Licenses for Branch Offices. If the applicant for a

19 real estate broker's license maintains more than one place of business within the

20 CNMI he shall apply for and procure an additional license for each branch office

21 so maintained by him. Every such application shall state the name of the person

22 and the location of the place or places of business for which such license is

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1 desired. The Commissioner may determine whether or not a real estate broker is

2 doing a real estate brokerage business at or from any particular location which

3 requires him to have a branch office license.

4 § 104230. Signs: Requirement for: Regulations. Each real estate broker

5 shall erect and maintain a sign in a conspicuous place on the premises to indicate

6 that he is a licensed real estate broker and his name shall be clearly shown

7 thereon. The size and place of the sign shall conform to regulations that may be

8 adopted by the Commissioner.

9 § 104231. Suspension or Revocation of License for Violation of

10 Provisions. for a violation of any of the provisions of§ 104214, 104215, 104218,

11 and 104230, the Commissioner may temporarily suspend or permanently revoke

12 the license of the real estate licensee in accordance with the provisions of this

13 Division relating to hearing.

14 ARTICLE 3

15 DISCIPLINARY ACTIONS

16 § 104301. Revocation or Suspension of Licenses.

17 § 104302. Investigations: Grounds for Action.

18 § 104303. Additional Grounds for License Suspension or Revocation.

19 § 104304. Discipline when Judgment is for Fraud or Misrepresentation or

20 Deceit. § 104305. Action on Commitment for or Adjudication of Insanity or

21 Incompetency.

22 § 104306. Broker to Report Dismissal of Salesman.

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1 § 104307. Knowledge of Violation by Salesman or Employee.

2 § 104308. Denial, Suspension or Revocation of Officer's or Partner's

3 License.

4 § 104309. Conditions of License Reinstatement.

5 § 104310. Inspection & Audit of Brokers & Salesmen.

6 § 104301. Revocation or Suspension of Licenses. Upon grounds

7 provided in this Article and the other Articles of this Chapter, the license of any

8 real estate licensee may be revoked or suspended in accordance with the

9 provisions of this Chapter relating to hearings.

1 O § 104302. Investigations: Grounds for Action. The Commissioner may,

11 upon his own motion, and shall, upon the verified complaint in writing of any

12 person, investigate the actions of any person engaged in the business or acting in

13 the capacity of a real estate licensee within the CNMI, and he may temporarily

14 suspend or permanently revoke a real estate license at any time where the licensee,

15 while a real estate licensee, in performing or attempting to perform any of the acts

16 within the scope of this Chapter has been guilty of any of the following:

17 (a) Making any substantial misrepresentation.

18 (b) Making any false promises of a character likely to influence, persuade

19 or induce.

20 ( c) A continued and flagrant course of misrepresentation or making of

21 false promises through real estate agents or salesmen.

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1 ( d) Acting for more than one party in a transaction without the knowledge

2 or consent of all parties thereto.

3 ( e) Commingling with its own money or properly the money or other

4 property of others which is received and held by him.

5 (f) Claiming, demanding, or receiving a fee, compensation or commission

6 under any exclusive agreement authorizing or employing a licensee to sell, buy or

7 exchange real estate for compensation or commission where such agreement does

8 not contain a definite, specified date of final and complete termination.

9 (g) The claiming or taking by licensee of any secret or undisclosed amount

1 O of compensation, commission, or profit or the failure of a licensee to reveal to the

11 employer of such licensee the full amount of such licensee=s compensation,

12 commission or profit under any agreement authorizing or employing such licensee

13 to do any acts for which a license is required under this Chapter for compensation

14 or commission prior to or coincident with the signing of an agreement evidencing

15 the meeting of the minds of the contracting parties, regardless of the form of such

16 agreement, whether evidenced by documents in an escrow or by any other or

17 different procedure.

18 (h) The use by a licensee of any provision allowing the licensee the option

19 to purchase in an agreement authorizing or employing such licensee to sell, buy or

20 exchange real estate for compensation or commission, except when such licensee

21 prior to or coincident with election to exercise such option to purchase reveals in

22 writing to the employer the full amount of licensee's profit and obtains the written

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1 (i) Any other conduct, whether of the same or a different character than

2 specified in this section, which constitutes fraud or dishonest dealing.

3 § 104303. Additional Grounds for License Suspension or Revocation.

4 The Commissioner may suspend or revoke the license of any real estate

5 licensee, or may deny the issuance of a license to an applicant, who has done any

6 of the following:

7 (a) Procured, or attempted to procure, a real estate license for himself or

8 any salesman, by fraud, misrepresentation or deceit, or by making any material

9 misstatement of fact in an application for a real estate license.

10 (b) Entered a plea of guilty of nolo contendere to, or been found guilty of,

11 or been convicted of, a felony or a crime involving moral turpitude, and the time

12 of appeal has elapsed or the judgment of conviction has been affirmed on appeal,

13 irrespective of an order granting probation following such conviction, suspending

14 the imposition of sentence, or setting aside the verdict of guilty, or dismissing the

15 accusation or information.

16 ( c) Knowingly, authorized, directed, connived at or aided in the

1 7 publication, advertisement, distribution, or circulation of any material false

18 statement or representation concerning his business or any land or subdivision

19 offered for sale.

20 ( d) Willfully disregarded or violated any of the provisions of the Real

21 Estate Law or the rules and regulations of the Commissioner for the

22 administration and enforcement of the Real Estate Law.

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1 (e) Willfully used the term Realtor or any trade name or insignia of

2 membership in any real estate organization of which the licensee is not a member.

3 (f) Acted or conducted himself in a manner which would have warranted

4 the denial of his application for a real estate license.

5 (g) Demonstrated negligence or incompetence in performing any act for

6 which he is required to hold a license.

7 (h) If, as a broker licensee, failed to exercise reasonable supervision over

8 the activities of his salesmen.

9 (i) Failed to pay when due a monetary penalty or forfeiture assessed by the

10 Commissioner.

11 (j) Has used his employment by a governmental agency in a capacity

12 giving access to records, other than public records, in such manner as to violate

13 the confidential nature of such records.

14 (k) Any other conduct, whether of the same or of a different character than

15 specified in this section, which constitutes fraud or dishonest dealing.

16 § 104304. Discipline when Judgment is for Fraud or

17 Misrepresentation or Deceit. When a final judgment is obtained in a civil action

18 against any real estate licensee upon grounds of fraud, misrepresentation, or deceit

19 with reference to any transaction for which a license is required under this

20 Division, the Commissioner may, after hearing in accordance with the provisions

21 of this Division relating to hearings, suspend or revoke the license of such real

22 estate licensee.

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1 § 104305. Action on Commitment for or Adjudication of Insanity or

2 Incompetency. The Commissioner may revoke or suspend the license of a real

3 estate licensee committed or adjudged insane, mentally ill or incompetent under

4 the laws of the CNMI or by any federal court of competent jurisdiction, at any

5 time until a subsequent adjudication of competence or restoration to capacity.

6 § 104306. Broker to Report Dismissal of Salesman. When any real

7 estate salesman is discharged by his employer for a violation of any of the

8 provisions of this Article prescribing a ground for disciplinary action, a certified

9 written statement of the facts with reference thereto shall be filed forthwith with

1 O the Commissioner by the employer and if the employer fails to notify the

11 Commissioner as required by this section, the Commissioner may temporarily

12 suspend or permanently revoke the real estate license of the employer, in

13 accordance with the provisions of this Division relating to hearings.

14 § 104307. Knowledge of Violation by Salesman or Employee. No

15 violation of any of the provisions of this Division relating to real estate by any real

16 estate salesman or employee of any licensed real estate broker shall cause the

1 7 revocation or suspension of the license of the employer of the salesman or

18 employee unless it appears on a hearing by the Commissioner that the employer

19 has guilty knowledge of such violation.

20 § 104308. Denial, Suspension or Revocation of Officer's or Partner's

21 License. The Commissioner may deny, suspend, or revoke the real estate license

22 of a corporation as to any officer or agent acting under its license, and the real

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1 estate license of a co-partnership as to any member acting under its license,

2 without revoking the license of the corporation or of the co-partnership.

3 § 104309. Conditions of License Reinstatement. As a condition to the

4 reinstatement of a revoked or suspended license, the Commissioner may require

5 the applicant to take and pass a qualifying examination.

6 § 104310. Inspection & Audit of Brokers & Salesmen. All records,

7 books and accounts of a real estate broker or salesman as defined in this Division

8 whether or not actually so licensed shall, upon the appearance of sufficient cause,

9 be subject to inspection and audit by the Commissioner or his designated

10 representative.

11 ARTICLE 4

12 FEES

13 § 104401. License Fees: Expiration Date.

14 § 104402. License Renewals.

15 § 104403. Definitions Of Limited Application.

16 § 104404. Definitions: Original Real Estate Broker's License.

17 § 104405. Definitions: Renewal Real Estate Broker's License.

18 § 104406. Definitions: Original Real Estate Salesman's License.

19 § 104407. Definitions: Renewal Real Estate Salesman's License.

20 § 104408. Period of Effectiveness of Licenses.

21 § 104409. Amount of Fees Fixed: Fee Not Refundable.

22 § 104410. License Fee.

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1 § 104411. License Fee: When Payable: Failure of Examination:

2 Additional Examination Fee.

3 § 104412. Same: Restricted Broker's License Fee.

4 § 104413. Renewal Broker's License Fee.

5 § 104414. License Issued to Corporation: Effect: Fee for Other

6 Officers.

7 § 104415. Renewal License to Partnership: Rights Granted: Fee for

8 Other Members.

9 § 104416. Original Salesman's License Fee.

10 § 104417. Same: When Payable: Failure of Examination: Additional

11 Fee.§ 104418. Same: Restricted License Fee.

12 § 104419. Renewal Salesman's License Fee.

13 § 104420. Limited Salesman's License Fee.

14 § 104421. Branch Office Broker's License Fee.

15 § 104422. Change of Name or Address Fee.

16 § 104423. Salesman's License Transfer Fee.

1 7 § 104424. Duplicate License Fee.

18 § 104425. Reinstatement of License: Fee.

19 § 104426. [Reserved]

20 § 104427. Authorization for Appropriations.

21

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1 § 104401. License Fees: Expiration Date. All real estate license fees

2 shall be payable in advance of issuing the licenses and at the time of filing the

3 application. Unless otherwise provided, all licenses expire at midnight of the last

4 day of the period for which issued.

5 § 104402. License Renewals. Notwithstanding any other provision of this

6 Division, the holder of a renewal license who fails to renew it prior to the

7 expiration of the period for which it was issued and who has otherwise qualified

8 for such license, may renew it within two years from such expiration upon proper

9 application and the payment of a late renewal fee in an amount equal to one and

10 one-half times the regular renewal fee. Notwithstanding any other provision of

11 this Division, if a person who is or has been licensed under the provisions of this

12 Chapter complies with all of the requirements for a renewal license except that the

13 application is not filed within the time prescribed, the Commissioner may issue an

14 renewal license if he finds the delay was due to mistake, inadvertence, surprise or

15 excusable neglect; provided, however, that any applicable late renewal fee shall be

16 charged.

1 7 § 104403. Definitions of Limited Application. The definitions contained

18 in this Article are solely for the purposes of this Article.

19 § 104404. Definitions: Original Real Estate Broker's License. An

20 original real estate broker's license is a real estate license issued to a person who

21 did not have a renewal real estate broker's license within the one-year period

22 immediately preceding the date of the application for such license, or who had

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1 failed to become eligible for a renewal license under a previous original real estate

2 broker's license.

3 § 104405. Definitions: Renewal Real Estate Broker's License. A

4 renewal real estate broker's license is a real estate license issued to a person who

5 had a renewal real estate broker's license, unrevoked or unsuspended, within the

6 one-year period immediately preceding the date of the application for such

7 renewal license, or who had become eligible for a renewal license, during the

8 preceding three (3) months, under an original real estate broker's license.

9 § 104406. Definitions: Original Real Estate Salesman's License. An

10 original real estate salesman's license is a real estate license issued to a person

11 who did not have a renewal real estate salesman's license within the one-year

12 period immediately preceding the date of the application for such license, or who

13 had failed to become eligible for a renewal license under a previous original real

14 estate salesman's license.

15 § 104407. Definitions: Renewal Real Estate Salesman's License. A

16 renewal real estate salesman's license is a real estate license issued to a person ( 1)

17 who had a renewal real estate salesman's license or a renewal broker's license

18 unrevoked or unsuspended within the one-year period immediately preceding the

19 date of the application for such renewal license, or (2) who had become eligible

20 for a renewal license during the preceding three (3) months under an original real

21 estate salesman's license, or (3) who had failed to qualify for a renewal real estate

22 broker's license during the preceding three (3) months under an original real estate

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1 broker's license, but who has satisfied all the requirements for a renewal

2 salesman's license pursuant to the provisions of§ 104208.

3 § 104408. Period of Effectiveness of Licenses. All renewal real estate

4 broker's licenses and renewal real estate salesman's licenses shall he issued for

5 periods of four ( 4) years.

6 § 104409. Amount of Fees Fixed: Fee Not Refundable. The amount of

7 the real estate fees prescribed for a license under this Chapter is that fixed by the

8 following provisions of this Article. No part of any fee paid in accordance with

9 the provisions of this Chapter is refundable. It is deemed earned by the department

10 upon its receipt.

11 § 104410. License Fee. The original real estate broker's license fee is Two

12 Hundred Dollars ($200.00) for a two (2) year period.

13 § 104411. License Fee: When Payable: Failure of Examination:

14 Additional Examination Fee. The original real estate broker's license fee is

15 payable at the time of the filing of an application for an original real estate

16 broker's license. If the applicant fails to pass the required written examination, he

1 7 may be permitted to take another examination upon filing a request to the

18 Department and upon the payment of a fee which shall be determined by the

19 Director and which shall consist of the actual examination cost including costs to

20 administer the examination. If an applicant fails to qualify for an original real

21 estate broker's license within three (3) years from the date of filing his

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1 application, said application shall thereupon lapse and no further proceedings

2 thereon shall be taken.

3 § 104412. Same: Restricted Broker's License Fee.

4 The restricted broker's license fee is One Hundred Dollars ($100.00) for a

5 one ( 1) year period.

6 § 104413. Renewal Broker's License Fee. The renewal real estate

7 broker's license fee is Four Hundred Dollars ($400.00) for a four (4) year period.

8 § 104414. License Issued to Corporation: Effect: Fee for Other

9 Officers. If the licensee is a corporation, the license issued to it entitles one

10 officer thereof, on behalf of the corporation, to engage in the business of real

11 estate broker without the payment of any further fee, such officer to be designated

12 in the application of the corporation for a license. for each officer other than the

13 officer so designated, through whom it engages in the business of real estate

14 broker, the appropriate original or renewal fee is to be paid in addition to the fee

15 paid by the corporation.

16 § 104415. Renewal License to Partnership: Rights Granted: Fee for

1 7 Other Members. If the licensee is a co-partnership, the license issued to it entitles

18 one member only of the co-partnership to engage on behalf of the co-partnership

19 in the business of real estate broker, which member shall be designated in the

20 application of the co-partnership for a license. for each other member of the co-

21 partnership who on behalf of the co-partnership engages in the business of real

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1 estate broker the appropriate original or renewal fee is to be paid in addition to the

2 fee paid by the co-partnership.

3 § 104416. Original Salesman's License Fee. The original real estate

4 salesman's license fee is One Hundred Dollars ($100.00) for a two (2) year

5 period.

6 § 104417. Same: When Payable: Failure of Examination: Additional

7 Fee. An original real estate salesman's license fee is payable on filing an

8 application for an original real estate salesman's license. If the applicant fails to

9 pass the required written examination, he may be permitted to take another

10 examination upon filing a request to the Department and upon the payment of a

11 fee which shall be determined by the Director and which shall consist of the actual

12 examination cost, including costs to administer the examination. If an applicant

13 fails to qualify for an original real estate salesman's license within three (3) years

14 from the date of filing his application, said application shall thereupon lapse and

15 no further proceedings thereon shall be taken.

16 § 104418. Same: Restricted License Fee. The restricted salesman's

17 license fee is Fifty Dollars ($50.00) for a one (1) year period.

18 § 104419. Renewal Salesman's License Fee. The renewal real estate

19 salesman's license fee is Two Hundred Dollars ($200.00) for a four (4) year

20 period.

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1 § 104420. Limited Salesman's License Fee. The limited real estate

2 salesman's license fee is Fifty Dollars ($50.00) for a one hundred twenty (120)

3 day period.

4 § 104421. Branch Office Broker's License Fee. For a branch office

5 broker's license the fee is Fifty Dollars ($50.00).

6 § 104422. Change of Name or Address Fee. For change of name or of

7 address of license on the records of the Department, the fee is Twenty-five Dollars

8 ($25 .00).

9 § 104423. Salesman's License Transfer Fee. For transfer of a salesman's

10 license on change of employer, the fee is Twenty-five Dollars ($25 .00).

11 § 104424. Duplicate License Fee. For a duplicate license the fee 1s

12 Twenty-five Dollars ($25.00).

13 § 104425. Reinstatement of License: Fee. For reinstatement of a license

14 within a licensing period or at the time of renewal the fee is Twenty-five Dollars

15 ($25.00). As used in this Section, reinstatement of a license means the reissuance

16 of a canceled or inactivated real estate broker's license or the reissuance of a real

17 estate salesman's license, which was canceled or inactivated during the period for

18 which it was issued upon the salesman's withdrawal from the employ of a real

19 estate broker.

20 § 104426. [Reserved]

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1 § 104427. Authorization for Appropriations. There are hereby

2 authorized to be appropriated such sums as are necessary for the

3 implementation of the provisions of this Act."

4 Section 3. Severability. If any provisions of this Act or the application

5 of any such provision to any person or circumstance should be held invalid by a

6 bourt of competent jurisdiction, the remainder of this Act or the application of its

7 /Provisions to persons or circumstances other than those to which it is held invalid

8 shall not be affected thereby.

9 Section 4. Savings Clause. This Act and any repealer contained herein

10 shall not be construed as affecting any existing right acquired under contract or

11 acquired under statutes repealed or under any rule, regulation, or order adopted

12 under the statutes. Repealers contained in this Act shall not affect any proceeding

13 instituted under or pursuant to prior law. The enactment of the Act shall not have

14 the effect of terminating, or in any way modifying, any liability, civil or criminal,

15 which shall already be in existence on the date this Act becomes effective.

16 Section 5. Effective Date. This Act shall take effect 24 months after its

17 approval by the Governor, or its becoming law without such approval.

Pr,,fr'l.u/. : ~ /tL~/ 11 ~at-t- : '? I 27; / , 7

~ ~ Introduced By: ~ ----..J

Rep.Janet U. Maratita

Reviewed for introduction purposes only:

rS _?

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