452.12 Note NOTE: Sub. (4) is shown as affected by 2015 Wis. Acts 258 and 269 as merged by the legislative reference bureau under s. 13.92 (2) (i).
452.12(5) (5)Renewal.
452.12(5)(a)(a) Renewal applications for all licenses shall be submitted with the applicable renewal fee determined by the department under s. 440.03 (9) (a) on or before the applicable renewal date specified under s. 440.08 (2) (a). The department shall pay $10 of each renewal fee received under this paragraph to the Board of Regents of the University of Wisconsin System for research and educational, public outreach, and grant activities under s. 36.25 (34).
452.12(5)(b) (b) If an application for renewal of a license issued to an individual is not filed with the board on or before the renewal date with the proof required under par. (c) or if the renewal is not granted, the applicant may not engage in any of the activities covered by the license until the license is renewed or a new license is issued.
452.12(5)(bm) (bm) If an application for renewal of a license issued to a firm is not filed with the board on or before the renewal date or if the renewal is not granted, all of the following apply:
452.12(5)(bm)1. 1. The firm may not engage in any of the activities covered by the license until the license is renewed or a new license is issued.
452.12(5)(bm)2. 2. Any licensees associated with the firm may not engage in any of the activities covered by the firm's license on behalf of the firm until the firm's license is renewed or a new license is issued.
452.12(5)(bm)3. 3. A licensed individual broker or licensed broker business entity who is serving as a business representative for the firm shall notify each licensee associated with the firm that the firm's license was not renewed and, within 10 days after notifying a licensee, file with the department a notice of termination for each such licensee on a form prescribed by the department.
452.12(5)(c) (c) At the time of renewal, each broker or salesperson who is an individual shall submit proof of attendance at and successful completion of continuing education programs or courses approved under s. 452.05 (1) (g).
452.12(5)(d) (d) At the time of renewal, each broker or salesperson who is an individual shall complete the form under s. 452.05 (1) (i).
452.12 Cross-reference Cross-reference: See also chs. REEB 17, 23, and 25, Wis. adm. code.
452.13 452.13 Trust accounts.
452.13(1)(1)Definitions. In this section:
452.13(1)(a) (a) “Client funds" means all downpayments, earnest money deposits, or other money related to a conveyance of real estate that is received by a licensee on behalf of a firm or any other person. “Client funds" does not include promissory notes.
452.13(1)(b) (b) “Depository institution" means a bank, savings bank, savings and loan association or credit union that is authorized by federal or state law to do business in this state and that is insured by the federal deposit insurance corporation or by the national credit union share insurance fund.
452.13(2) (2)Interest-bearing common trust account.
452.13(2)(a)(a) A firm that holds client funds shall establish an interest-bearing common trust account in a depository institution. The interest-bearing common trust account shall earn interest at a rate not less than that applicable to individual accounts of the same type, size, and duration and for which withdrawals or transfers can be made without delay, subject to any notice period that the depository institution is required to observe by law or regulation.
452.13(2)(b) (b) Any firm that maintains an interest-bearing common trust account shall do all of the following:
452.13(2)(b)1. 1. Register with the department the name and address of the depository institution and the number of the interest-bearing common trust account.
452.13(2)(b)2. 2. Notify the department when any of the information required under subd. 1. is changed.
452.13(2)(b)3. 3. Furnish the department with a letter authorizing the department and the department of administration to examine and audit the interest-bearing common trust account whenever either department considers it necessary.
452.13(2)(bm) (bm) The department shall forward to the department of administration the information and documents furnished under par. (b).
452.13(2)(c) (c) A firm shall deposit all client funds in the interest-bearing common trust account.
452.13(2)(d) (d) The department of administration is the beneficial owner of the interest accruing to the interest-bearing common trust account, minus any service charges or fees.
452.13(2)(e) (e) For each interest-bearing common trust account, the firm shall direct the depository institution to do all of the following:
452.13(2)(e)1. 1. Annually, before February 1, remit to the department of administration the total interest or dividends, minus service charges or fees, earned on the average daily balance in the interest-bearing common trust account during the 12 months ending on the previous December 31. A depository institution is not required to remit any amount if the total interest or dividends for that period is less than $10 before any deduction for service charges or fees.
452.13(2)(e)2. 2. When the interest remittance is sent, furnish to the department of administration and to the firm maintaining the interest-bearing common trust account a statement that includes the name of the firm for whose account the remittance is made, the rate of interest applied, the amount of service charges or fees deducted, if any, and the account balance for the period that the statement covers.
452.13(2)(f) (f) A depository institution:
452.13(2)(f)1. 1. May not assess a service charge or fee that is due on an interest-bearing common trust account against any firm or, except as provided in subd. 3., against any other account, regardless of whether the same firm maintains the other account.
452.13(2)(f)2. 2. May not assess a service charge or fee for an interest-bearing common trust account against the department of administration.
452.13(2)(f)3. 3. May deduct a service charge or fee from the interest earned by an interest-bearing common trust account, and if a balance remains, may deduct the remaining charge or fee from the interest earned on any other interest-bearing common trust account maintained in that depository institution, before remitting interest to the department of administration.
452.13(2)(f)4. 4. May not deduct a service charge or fee from the principal of an interest-bearing common trust account.
452.13(3) (3)Deposit provisions. A firm that deposits client funds in an interest-bearing common trust account in compliance with this section may not be held liable to the owner or beneficial owner of the client funds for damages due to compliance with this section. A licensee that deposits client funds in an interest-bearing common trust account in compliance with this section on behalf of a firm is not required to disclose alternative depository arrangements that could be made by the parties or to disclose that a deposit will be made under this section.
452.13(4) (4)Trust account optional. This section does not require a firm to hold client funds or require a person to transfer client funds to a firm.
452.13(5) (5)Rules. In consultation with the department, the department of administration shall promulgate rules necessary to administer this section.
452.13 Cross-reference Cross-reference: See also chs. Adm 91 and REEB 18, Wis. adm. code.
452.13 Annotation Security deposits by a tenant usually create a debtor-creditor relationship. A broker retaining a deposit should deposit it in his or her trust account. 60 Atty. Gen. 1.
452.13 Annotation The Federal National Mortgage Association is exempt from the requirements of this section, but private mortgage bankers or mortgage brokers licensed as real estate brokers under ch. 452, and servicing mortgages for FNMA must deposit loan, insurance and tax escrow moneys in authorized trust account in a bank located in Wisconsin, subject to audit by the board. 60 Atty. Gen. 514.
452.132 452.132 Responsibilities of firms and licensees.
452.132(1) (1) A firm shall supervise the brokerage service activities of each licensee associated with the firm, including by doing all of the following:
452.132(1)(a) (a) Ensuring that a supervising broker for the firm complies with sub. (4).
452.132(1)(b) (b) Providing a licensee with reasonable access to a supervising broker for the purpose of consultation regarding real estate practice issues.
452.132(2) (2) A firm shall do all of the following:
452.132(2)(a) (a) Provide each licensee associated with the firm with a written statement of the procedures under which the firm and licensees associated with the firm must operate with respect to handling leases, agency agreements, offers to purchase, and other documents and records relating to transactions.
452.132(2)(b) (b) Notify each licensee associated with the firm where a copy of the rules promulgated by the board related to the conduct, ethical practices, and responsibilities of licensees may be obtained.
452.132(2)(c) (c) Before a licensee becomes associated with the firm and at the beginning of each biennial licensure period, ensure that the licensee holds a valid license.
Effective date note NOTE: Par. (c) is shown as amended eff. 12-14-16 by 2015 Wis. Act 258. Prior to 12-14-16 it reads:
Effective date text (c) Before a licensee becomes associated with the firm and at the beginning of each biennial licensure period, ensure that the licensee holds a valid license or registration.
452.132(3) (3) A firm shall be responsible for the custody and safety of all documents and records relating to transactions submitted to the firm as required under sub. (6) (b).
452.132(4) (4)
452.132(4)(a)(a) A supervising broker for a firm, as determined under sub. (5), shall review all of the following prior to the closing of a transaction in accordance with par. (b):
452.132(4)(a)1. 1. All agency agreements, offers to purchase, leases, and other documents that are executed by the parties and records relating to the transaction that are used by a licensee associated with the firm and submitted to the firm as required under sub. (6) (b).
452.132(4)(a)2. 2. All trust account records relating to the transaction.
452.132(4)(b) (b) The review under par. (a) shall be limited to confirming that a written disclosure statement to a customer or client has been provided by a licensee associated with the firm in accordance with s. 452.135, confirming that any applicable form approved by the board has been used and the forms have been completed by filling in the blanks in a manner consistent with the structure of the form, and communicating to the licensee any errors in how the forms were completed that are apparent on the face of the document and known to the person reviewing the document.
452.132(5) (5)
452.132(5)(a)(a) A firm that is a licensed broker business entity shall delegate the performance of the duty to supervise licensees associated with the firm to a supervising broker who is a licensed individual broker.
452.132(5)(b) (b) A firm that is not a licensed broker business entity may delegate the duty to supervise licensees associated with the firm to a supervising broker who is a licensed individual broker, but in the absence of a specific supervising broker delegation, the firm itself is deemed to be the supervising broker for that firm.
452.132(5)(c) (c) A delegation under par. (a) or (b) shall be written and signed by or on behalf of the delegating firm, identify the duty delegated, and be signed by the broker to whom the delegation is made.
452.132(5)(d) (d) A firm may delegate the duty to supervise licensees to more than one supervising broker.
452.132(6) (6)
452.132(6)(a)(a) A licensee associated with a firm shall be responsible for discussing with the party with whom the licensee is working with or representing any error communicated to the licensee as provided in sub. (4) (b), and the party shall determine whether to request any changes to address the error.
452.132(6)(b) (b) A licensee associated with a firm shall submit to the firm in a timely manner all agency agreements, offers to purchase, leases, and other documents that are executed by the parties and records related to the brokerage services provided on behalf of the firm and transactions that are used or received by the licensee.
452.132 History History: 2015 a. 258.
452.133 452.133 Duties of licensees.
452.133(1) (1)Duties to all parties to a transaction. A firm providing brokerage services to a party to a transaction owes all of the following duties to the party:
452.133(1)(a) (a) The duty to provide brokerage services honestly and fairly.
452.133(1)(b) (b) The duty to provide brokerage services with reasonable skill and care.
452.133(1)(c) (c) The duty to timely disclose in writing all material adverse facts that the firm knows and that the party does not know or cannot discover through reasonably vigilant observation, unless the disclosure of a material adverse fact is prohibited by law.
452.133(1)(d) (d) The duty to keep confidential any information given to the firm in confidence, or any information obtained by the firm that the firm knows a reasonable person would want to be kept confidential, unless the information must be disclosed by law or the person whose interests may be adversely affected by the disclosure specifically authorizes the disclosure of particular information. The firm shall continue to keep the information confidential after the transaction is complete and after the firm is no longer providing brokerage services to the party.
452.133(1)(e) (e) The duty to provide accurate information about market conditions that affect the transaction, within a reasonable time after a request for such information by the party, unless disclosure of the information is prohibited by law.
452.133(1)(f) (f) The duty to safeguard trust funds and other property held as required by rules promulgated under s. 452.13 (5).
452.133(1)(g) (g) When the firm is negotiating on behalf of a party, the duty to present contract proposals in an objective and unbiased manner and disclose the advantages and disadvantages of the proposals.
452.133(2) (2)Duties to clients. A firm providing brokerage services to a client owes the client the duties that the firm owes to a party under sub. (1) and all of the following additional duties:
452.133(2)(a) (a) The duty to loyally represent the client's interests by doing all of the following:
452.133(2)(a)1. 1. Placing the client's interests ahead of the interests of the firm.
452.133(2)(a)2. 2. Placing the client's interests ahead of the interests of persons in the transaction who are not the firm's clients by not disclosing to persons in the transaction other than the firm's clients information or advice the disclosure of which is contrary to the interests of a client of the firm, unless the disclosure is required by law.
452.133(2)(am) (am) The duty to provide, when requested by the client, information and advice to the client on matters that are material to the client's transaction and that are within the scope of the knowledge, skills, and training required under this chapter.
452.133(2)(b) (b) The duty to disclose to the client all information known by the firm that is material to the transaction and that is not known by the client or discoverable by the client through reasonably vigilant observation, except for confidential information under sub. (1) (d) and other information the disclosure of which is prohibited by law.
452.133(2)(c) (c) The duty to fulfill any obligation required by the agency agreement, and any order of the client that is within the scope of the agency agreement, that is not inconsistent with another duty that the firm has under this chapter or any other law.
452.133(2)(d) (d) The duty to negotiate on behalf of the client.
452.133(3) (3)Prohibited conduct. In providing brokerage services, a licensee may not do any of the following:
452.133(3)(a) (a) Accept any fee or compensation related to the transaction from any person other than the licensee's client, principal firm, or firm, without the prior written consent of all parties to the transaction.
452.133(3)(b) (b) Act in a transaction on the licensee's own behalf, on behalf of the licensee's immediate family if the firm is an individual, on behalf of the licensee's firm, or on behalf of any organization or business entity in which the licensee has an interest, without the prior written consent of all parties to the transaction. For the purpose of complying with this paragraph, a licensee shall obtain the written consent in the offer to purchase, option, lease, or other transaction contract.
452.133(3)(c) (c) Except as provided in s. 452.19 (1), refer, recommend, or suggest to a party to the transaction the services of an individual or entity from which the licensee may receive compensation for a referral or in which the licensee has an interest, unless the licensee has disclosed in writing the fact that the licensee may receive compensation or has disclosed in writing an interest in the individual or entity providing the services.
452.133(4) (4)Subagent's duties.
452.133(4)(a)(a) A subagent owes all parties to whom the subagent is providing brokerage services in a transaction the duties specified in sub. (1) but does not owe the clients of the principal firm the duties under sub. (2).
452.133(4)(b) (b) A subagent may not do any of the following:
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2013-14 Wisconsin Statutes updated through 2015 Wis. Act 392 and all Supreme Court and Controlled Substances Board Orders effective on or before November 21, 2016. Published and certified under s. 35.18. Changes effective after November 21, 2016 are designated by NOTES. (Published 11-21-16)