Oregon Real Estate News-Journal July '06 by jrnbbyzbujktdafk


									                                              Oregon Real Estate
                                                          Official Publication of the Oregon Real Estate Agency
Vol. 60                                                July 2006, Salem, Oregon                                                           No. 2

                           Scott W. Taylor, Real Estate Commissioner

    n a recent issue, I asked for com-           the criteria to judge it, and certificate
     ments regarding our continuing              requirements. Hopefully, what follows
     education system. I received nu-            will address those issues.
merous comments from licensees. Ad-                  ORS 696.174 (1) states: “To qualify
ditionally, we received many comments            an active license for renewal, the real
on this subject in the recent focus              estate licensee must present evidence
groups held by the Agency around the             of attendance during the preceding two
state. Based upon the nature of these            license years at 30 clock-hours of real
comments, it appears there is senti-             estate-oriented continuing education
ment to pursue this subject further,             courses, of which a minimum of 15
and we expect to take up more discus-            clock-hours shall be in required course
sions about continuing education in              topics.”
the near future. For those licensees who             All licensees have been required to
contributed; thank you and you have              attend 30 hours of continuing educa-
not been forgotten.                              tion since 1996.
   I have also received feedback from                During a compliance review, Agency
Agency staff as a result of what they are        staff verifies that the certifying licensee
finding on compliance reviews.                   has retained copies of Certificates of                       Commissioner Scott Taylor
   The staff conducting compliance               Attendance for continuing education
reviews has reported that there are Prin-        courses.                                         peating the same course within the
cipal Brokers who believe they are ex-               The rules for continuing education           same two year period will not count as
empt from continuing education re-               courses can be found at OAR 863-015-             additional credit.
quirements. Principal Brokers are not            0055. These rules set out the topics                The rules further provide guidance
exempt from continuing education re-             for the 15 hours of required topics.             as to certification criteria [OAR 863-
quirements. Property Managers are not            They state that the minimum course               015-0055 (3)], advanced practices
exempt from continuing education re-             length shall be one clock hour, exclu-           courses for licensees in their first licens-
quirements. ORS 696.174 (1) is not               sive of meal breaks or rest breaks.              ing cycle [OAR 863-015-0055 (4)],
limiting. It speaks to all real estate lic-      Though routine luncheons and meet-               and alternate delivery [OAR 863-015-
ensees; “… the real estate licensee ….”          ings per se do not qualify as continuing         0055 (5)].
They further report confusion about              education courses, classes given in con-            Certificates of attendance must con-
what constitutes continuing education,           junction with them may qualify. Re-                CONTINUING EDUCATION: continued on page 2

                                                                 IN THIS ISSUE
   Staff Changes .................................................... 2 Home Inspections: Tips to Help Your Clients ..... 4
   New Landlord and Tenant Laws Book                                     The Business of Flipping Houses ........................ 5
    Offered by Legislative Counsel ........................ 2 Administrative Actions ....................................... 6
   Receive Rule Notices by Mail or E-Mail ............ 2 Foreign Investors in Agricultural Lands ............. 10
   Course Required for New and                                           The Condominium Form of Ownership
    Relicensed Brokers ........................................... 3       in Oregon ...................................................... 11
   Board Meeting to be Held in Bend .................... 3 Have Your License Issued More Quickly ........... 11
2             July 2006                                                                                      OREGON REAL ESTATE NEWS-JOURNAL

CONTINUING EDUCATION: continued from page 1
tain the following information: The
                                                                                                           STAFF CHANGES
licensee’s name, the course title and                                                   The Real Estate Agency has expe-     place Ms. Rush. Mr. Owens has
date of completion, the instructor’s                                                 rienced a number of personnel           worked in state government since
name and course location, method of                                                  changes in the second quarter of        1996, most recently for the Oregon
course delivery, and whether an exami-                                               2006.                                   Department of Energy. He comes
nation was administered [OAR 863-                                                       Kathleen Presley retired as an In-   to the Agency with solid experience
015-0055 (6)].                                                                       vestigator/Auditor in April. She was    in both state accounting and bud-
   Principal Brokers who are certifying                                              with the Agency for over nine years,    geting.
courses for their affiliated licensees                                               and spent a total of 25                                  Tami Schemmel
should pay particular attention to the                                               years in service with                                   joined the Agency in
certification criteria. It is ultimately                                             the state.      Ms.                                       May as a Customer
the certifying licensee’s decision as to                                             Presley plans to                                             Services Repre-
whether the course warrants certifica-                                               spend her time ex-                                           sentative. Ms.
tion. A Principal Broker, for example,                                               ploring the coun-                                           Schemmel has
is not required to certify continuing                                                try in her recently                                         over 20 years of
education hours for courses he or she                                                purchased motor                                            experience in state
does not feel meet the criteria for certi-                                           home.                                                     government. She
fication. Affiliated licensees should                                                   After 11 years                                        replaced Christina
verify with the Principal Broker as to                                               with the Agency,                                         Ulberg, who ac-
whether he or she will certify a par-                                                Larry Taylor retired as                                cepted a position
ticular course if in doubt.                                                          an Investigator/Audi-                                  with the Department
                                                                                     tor in May. Mr. Taylor                         of Human Services after two
                                                                                     will be keeping occupied with fish-     and one-half years with the Agency.
                      OREGON REAL ESTATE                                             ing trips and home improvement             Carmen Twenge left the Agency
                        NEWS-JOURNAL                                                 projects.                               in June to spend more time with her
                         (USPS 905-220)
                                                                                        Rita Rush begins retirement in       family. Ms. Twenge has been Edu-
                    Official Publication                                             June after more than four years with    cation Coordinator since December
                Oregon Real Estate Agency                                            the Agency as Administrative Services   2002, and worked previously at the
     1177 Center St. N.E. - Salem, Oregon 97301-2505
               Telephone: (503) 378-4170                                             Manager. After spending over 12         Agency from 1988 to 1996.
           Facsimile: (503) 378-2491 Licensing                                       years in state service, Ms. Rush will      The Agency welcomes Mr. Owens
               (503) 373-7153 Regulation
             (503) 378-2491 Administration                                           use her retirement years for travel-    and Ms. Schemmel, and thanks Ms.
             Web Page: http://www.rea.state.or.us                                    ing, spending time with family, and     Presley, Mr. Taylor, Ms. Rush, Ms.
                                                                                     volunteering.                           Ulberg, and Ms. Twenge for their
                Theodore R. Kulongoski, Governor
                                                                                        Dean Owens was selected to re-       contributions to the Agency.
                 Scott W. Taylor, Commissioner

                     REAL ESTATE BOARD
Michael Graeper, Chairperson .............................. Portland
                                                                                        NEW LANDLORD AND       RECEIVE RULE NOTICES
Troy Costales ............................................................ Keizer
Victor Kee ............................................................... Astoria   TENANT LAWS BOOK OFFERED BY MAIL OR E-MAIL
Arthur Kegler ................................................... Boardman
Robert La Du ...................................................... Portland
Maxine Ribera-Card ................................................. Bend
                                                                                       BY LEGISLATIVE COUNSEL does notOREN-J’s publication schedule
                                                                                                                       always provide for timely no-
Vada Salinas ............................................................. Salem
Marianne Wood ..................................................... Eugene              The publication 2006 Landlord        tification of changes to the Agency’s ad-
John Zupan ......................................................... Medford         and Tenant Laws of Oregon is now        ministrative rules. The Agency has a
                                                                                     available from the Legislative Coun-    rulemaking mailing list, and is in the
The Oregon Real Estate News-Journal is published four times                          sel. The book includes selected laws    process of creating an e-mail list.
a year by the Oregon Real Estate Agency as an educational                            relating to the Residential Landlord        The Agency encourages anyone in-
service to all real estate licensees in the state under the provi-
sions of Section 696.445 of the Oregon Revised Statutes.                             and Tenant Act, hotels and motels,      terested in receiving notices to send a
$4.00/biennium subscription fee included in real estate li-                          temporary and transitional housing,     postcard to the Agency with your
cense fee. All other subscriptions $2.00 per year. POSTMAS-
TER: Send address changes to Oregon Real Estate News-Jour-                           and farm labor housing. The cost is     name, address, e-mail address, and your
nal, 1177 Center St. N.E., Salem, OR 97301-2505.                                     $23. For information on ordering,       preference for regular mail or e-mail
                                                                                     contact the Legislative Counsel at      notification. You may also provide this
                Mesheal Heyman, Editor                                               (503)      986-1243,       or   visit   information by e-mail to Administra-
            Carmen Twenge, Associate Editor
VOL. 60-No. 2                                     July 2006
                                                                                     http://www.lc.state.or.us.              tive Rules Coordinator Laurie Skillman
        Periodicals postage paid at Salem, Oregon                                                                            at laurie.a.skillman@state.or.us.
OREGON REAL ESTATE NEWS-JOURNAL                                                                                       July 2006             3

  Yo u m u s t c o m p l e t e a n R e a l   license was issued in May 2006,                 contact           the       Agency            at
Estate Agency-approved Ad-                   and your birthday is in June, your              (503) 378-4170.
vanced Real Estate Practices                 l i c e n s e w o u l d re n e w Ju n e 3 0 ,      When affiliated brokers com-
course (AP) if you:                          2007.                                                 plete the AP course, the
                                                  If your li-                                             course certificate must be
• received your very first Oregon            cense is in-                                                    given to their princi-
   real estate broker license after          active at                                                          p a l b r o k e r. T h e
   July 1, 2002 (this does not               the time                          KEE                                  principal broker
   include licensees who were re-
   quired to take the Associate
                                             newal, you
                                                                             YOU P                                     signs             the
                                                                                                                       l i c e n s e e’s r e -
   Broker Transition Course) ; or            do not need                   LIC    R                                     newal form
                                             to take the                       ENS                                      stating that
• let a previous Oregon license              AP course                             E!                                   the          course
   expire (or otherwise lapse) and           until you reacti-                                                          has            been
   obtained a new broker license             vate your license.                                                      completed, and
   after July 1, 2002.                            Principal brokers, sole                                        then keeps the
                                             practitioner brokers and property               certificate                for              six
   The AP course is a specific 30-           managers are not required to take               years          as       required             by
hour course that must be com-                the AP course.                                  ORS 696.280(2) and (3).
pleted before your first active li-               Although the AP course re-                    A list of approved providers for
cense renewal. Your first license            quirement is separate from con-                 the AP course can be found in the
is valid from the date of issue for          tinuing education requirements,                 document called Approved Pre-
one year and then onto the last              a principal broker may let affili-              License and Post-License Real
day of the month of your birth-              ated brokers use the AP course to               Estate Education, which can be
day. This means your first re-               meet the continuing education                   o b t a i n e d f r o m t h e A g e n c y’s
newal date may be less than 13               requirements.                                   website at www.rea.state.or.us, or
months after obtaining your li-                   If you do not know if you need             by calling the Agency at (503)
cense. For example, if your first            to take the AP course, please                   378-4170.

                      BOARD MEETING TO BE HELD IN BEND
   The next regularly scheduled
Real Estate Board meeting will be
held in Bend on Monday, August                                     CURRENT REAL ESTATE BOARD MEMBERS
21 at 10 a.m. The Bend location
was not yet determined at the                   Michael Graeper, Chair          Portland       Windermere/Cronin & Caplan
time of printing. Meeting loca-                 Troy Costales                   Salem          Public Member
tion and additional information                 Victor Kee                      Astoria        Pete Anderson Realty
will be posted on the Real Estate               Arthur Kegler                   Boardman       American West Properties
A g e n c y’s    website        at              Robert LaDu                     Portland       Re/Max Equity Group, Inc.
www.rea.state.or.us as soon as it’s             Maxine Ribera-Card              Bend           COLM Commercial Real Estate
available. Board meetings are                                                                     Services
open to the public.
                                                Vada Salinas                    Salem          Public Member
   The Real Estate Board, consist-
ing of seven industry members                   Marianne Wood                   Eugene         Prudential Real Estate
and two public members, meets                                                                     Professionals
six times a year. Board members                 John Zupan                      Medford        Windermere VanVleet &
are appointed by the Governor for                                                                 Associates
four-year terms. Board duties in-
clude providing advice to the                viewing proposed rulemaking,                    cense examination process.
Real Estate Commissioner and                 approving experience waiver re-                 Please contact the Agency at
the Governor’s office regarding              quests of real estate licensing ap-             (503) 378-4170, extension 251,
real estate industry matters, re-            plicants, and overseeing the li-                if you have any questions.
4       July 2006                                                        OREGON REAL ESTATE NEWS-JOURNAL

                                 HOME INSPECTIONS:
                             TIPS TO HELP YOUR CLIENTS
    Editor’s Note: Real estate brokers of-    main structure.                            are the roof, plumbing system, elec-
ten recommend a home inspection in               An inspection is the purchase of        trical system, etc.) CCB can provide
an effort to protect the interests of their   an educated opinion, not a guarantee.      information on who in the business
clients. The following information from       Reports by seller’s and buyer’s in-        is an Oregon certified home inspec-
the Construction Contractors Board may        spectors sometimes differ.                 tor. Certification means the individual
help brokers assist their clients.               A report is not a warranty. It does     has passed a comprehensive test and
                                              not guarantee that the house is sound      must complete continuing education
      What is a home inspection?              or that the buyer will never encoun-       courses.
   An inspection is a general, visual         ter any problems.                             A few general contractors are ex-
inspection of the house and its ap-              Some deficiencies can only be           empt from certification and may per-
purtenances. An inspection report             found by tearing apart the structure,      form home inspections. If an inspec-
should cover the major systems of the         which inspectors do not do. Inspec-        tor is not certified, CCB can confirm
house: structural, plumbing, electric,        tors will not move furniture, rugs or      if he or she is allowed by law to per-
heating and cooling, general interior,        other obstacles. Inspectors will not       form inspections.
insulation, ventilation, siding, win-         inspect areas which are inaccessible
dows, doors, roofs and attached ga-           (wall interiors, wet crawl spaces, steep         How does my client find a
rages. A WDO or wood destroying               or wet roofs, etc.).                               qualified inspector?
organism report (sometimes called a                                                         The following are recommenda-
pest and dry rot) is sometimes in-                 How can my client check an            tions you can make to your clients:
cluded. Usually not included are sep-               inspector’s qualifications?
tic systems, wells, underground pip-           First, clients can check with the         • Suggest that your client ask friends,
ing, swimming pools and other items         Construction Contractors Board                 co-workers, neighbors, personal at-
that are not considered part of the         (CCB) to make sure the business is             torney or lender for recommenda-
                                                                properly licensed.         tions— someone with no vested in-
                                                                It is helpful if your      terest in which inspector is chosen.
    HOME INSPECTOR TRADE ASSOCIATIONS                           clients have the
                                                                CCB number for           • The inspector’s professional back-
                                                                the business be-           ground is important. Advise your
                                                                fore calling the           client to confirm that the inspec-
                American Institute of Inspectors                CCB. A license             tor is experienced in the building
              (800) 877-4770, www.inspection.org                means the busi-            trades.
             American Society of Home Inspectors                ness is insured and
                (800) 743-2744, www.ashi.com                    bonded—some fi-          • Recommend that potential home
           National Association of Home Inspectors              nancial protection         buyers contract for a separate in-
                (800) 448-3942, www.nahi.org                    if problems hap-           spection so the buyer can retain
                                                                pen later. Clients         Construction Contractors Board
                           Local                                can also check how         claim rights. In most instances,
                                                                long a business has        buyers will not be able to hold the
      Central Oregon Association of Real Estate Inspectors
                                                                been licensed and          seller’s inspector liable for deficien-
                                                                if it has had any          cies.
     Northwest Oregon Certified Home Inspectors Association     claims          filed
             (360) 574-5600, dbarkee@comcast.net                against it.              • Some inspectors may be members
          Oregon Association of Home Inspectors-ASHI                Anyone who per-        of a not-for-profit trade association.
                 (503) 233-2225, www.oahi.org                   forms home inspec-         There are associations, both in Or-
           Oregon Real Estate Inspectors Association            tions of two or more       egon and nationally, that many
                (503) 640-0607, www.oreia.net                   components also            companies belong to that provide
                                                                must be certified          standards of practice, codes of eth-
          Southern Oregon Certified Home Inspectors
                                                                with the CCB. (Ex-         ics and industry-specific training.
                        (800) 877-4770
                                                                amples of compo-           (See box, “Home Inspector Trade
                                                                nents of a house               HOME INSPECTION: continued on page 5
OREGON REAL ESTATE NEWS-JOURNAL                                                                            July 2006          5

                                                         THE BUSINESS OF
HOME INSPECTION: continued from page 4
   Associations.”) The three national
   associations require some or all of

                                                         FLIPPING HOUSES
   their members to pass written com-
   petency tests and take continuing
   education. All their members must
   adhere to standards of practices and       Editor’s Note: This article was pub-      install or arrange to have them
   a code of ethics. Your client may       lished at the request of the Construc-       installed. [ORS 701.010 (3)]
   also want to ask if the inspector be-   tion Contractors Board.
   longs to a local trade association.                                               • An owner can arrange for the
                                              “Renovation game pays in hot              work to be done by a licensed
         How can the CCB help                          market”                          contractor. But this exemption
              my client?                                     June 24, 2005              does not apply to a person who,
   The CCB provides consumer pro-                           Portland Tribune            in the pursuit of an independent
tection and regulates the home in-                                                      business, does the work them-
spection industry. When disagree-            “Remodeling pros tell how to               selves or arranges for the work
ments occur between consumers and                  ‘flip’ houses”                       with the intent of offering the
home inspection businesses, the                              May 13, 2006               structure for sale before, upon or
CCB may be able to help.                                     The Oregonian              after completion. It is considered
   A complaint may be filed with the                                                    prima facie evidence that it was
CCB against the licensed business if:         And, then there was the March             the intent to offer the structure
1) there is a direct contract between      23, 2006 article in The Oregonian’s          for sale if the owner does not
the client and the licensee or if the      Neighborhood section which told              occupy the structure after
client purchased real estate condi-        about a couple’s faith in a three and        completion. [ORS 701.010 (5)]
tioned upon the inspection; 2) the         a half inch statue of St. Joseph
client thinks the business has done        placed in the yard to sell the home.      • A person can perform work on
negligent or improper work or              In reading the story, it revealed the        property they own even if they
breached the contract; and 3) it’s         home was being “flipped”.                    do not live there. And an owner’s
been within one year from the time            Flipping* houses is the term used         employee can perform work.
the inspection was performed.              to buy a home, fix it up and then            [ORS 701.010 (6)]
   If your contract contains an arbi-      selling it for a profit. It’s big busi-
tration clause, a complaint can still      ness. And it is a business, a regu-       • A real estate licensee when per-
be filed but the CCB may suspend           lated business.                              forming work on the structure
its dispute process to allow arbitra-         The Construction Contractors              that the real estate licensee
tion to occur. The CCB may send a          Board (CCB) is the state agency              manages under contract.
mediator/investigator to the site to       which protects consumers by regu-            [ORS 701.010 (12)]
look at the complaint issues and try       lating the construction industry.
to resolve the dispute.                    Oregon law defines a contractor as           Contractors in the business of
   If the dispute continues, the Con-      a person who for compensation or          flipping homes can be licensed as a
struction Contractors Board offers a       with the intent to sell, arranges, un-    Licensed Developer as long as they
hearing process to determine the va-       dertakes, offers to undertake or sub-     do not perform any of the work
lidity of the complaint and whether        mits a bid to construct, alter, re-       themselves. For more information,
damages are due the complainant.           pair, or improve any building or          go to www.oregon.gov/CCB and
The inspection contract may include        structure attached to real property.      click on Licensing. You can also call
a clause that limits the inspector’s li-   Contractors must be licensed with         the CCB at (503) 378-4621.
ability. Read your contract carefully.     the CCB.
Complaints filed against unlicensed           Below are listed a few of the ex-          *The term flipping can also be used to
businesses or home inspection busi-        emptions from the licensing re-           describe the purchase of real estate, hold-
nesses using uncertified individuals       quirement:                                ing for a short time, even a matter of min-
to perform inspections are sent to the                                               utes, and reselling it for a profit because
CCB’s Enforcement Section, but will        • A person can work on their own          they either bought it below market value
probably not result in direct benefit        home. [ORS 701.010 (1)]                 or market value is appreciating so rapidly.
to the complainant.                                                                  If nothing is done to the real estate, this
   For more information, please visit      • A person who furnishes the ma-          action does not fall under the jurisdiction
CCB’s website at www.oregon.gov/             terials, supplies or equipment          of the CCB.
CCB or call (503) 378-4621.                  and does not for compensation,
6       July 2006                                                           OREGON REAL ESTATE NEWS-JOURNAL

                         ADMINISTRATIVE ACTIONSFebruary 1, 2006 through May 15, 2006
                       The Agency is required      erty, with 5% interest rate and a       failed to repay Seller R for money
                       by Oregon Real Estate       mortgage broker fee of 1%. Subse-       Seller R loaned Brady in conjunc-
                       License Law to publish      quently, Brady drafted an offer for     tion with a real estate transaction.
                       disciplinary actions. A     Buyer P to purchase property for        Brady entered into an agreement to
                       list of those actions, a    the price of $169,000. Brady stated     borrow $7,500 from Seller R so
                       brief description of the    on the offer that Buyer P was pre-      Brady could close a transaction
                       situation, and the          approved for a VA loan in the of-       where Brady was purchasing a prop-
grounds for the Commissioner’s action fol-         fered amount. Buyer P was not able      erty in Eugene. The agreement
lows. Please note there are 60 days after the      to obtain a loan and the transac-       stated that Brady would repay
order date to file an appeal, and some of the      tion failed. The sellers would not      Seller R from loan fees paid to her
orders listed may be within that appeal pe-        agree to give Buyer P the earnest       from her mortgage broker employer
riod. Please also note, there are individuals      money as the offer stated that Buyer    on the property loan and from an-
with real estate licenses that may have simi-      P was pre-approved. Buyer P filed       other property listing commission
lar or the same names as those listed herein,      a small claims action for the return    owed by another party. The agree-
or even work in the same market area. If you       of the earnest money. Brady prom-       ment further stated that should the
are in doubt if an individual listed here is       ised Buyer P that she would ac-         sale fall through that she was to re-
someone you know or with whom you are              company him to court and testify        ceive a commission, that Brady
dealing, please contact the Agency for verifi-     that Buyer P had made all reason-       would repay Seller R in the month
cation.                                            able efforts to obtain financing.       of June 2004. On June 22, 2004,
    Finally, please note that stipulated settle-   Brady did not follow through on         the Seller R sale closed escrow and
ments do not necessarily reflect all the fac-      her promise to Buyer P and did not      Brady received a $2,640 commis-
tual violations initially alleged by the           appear in court. The parties settled    sion. Brady did not repay Seller R
Agency, and the sanction(s) may have               outside court by dividing the ear-      from her commission as agreed in
been adjusted as part of the negotiation           nest money equally. During the in-      their loan agreement. Separate from
process. Such settlements may not, there-          vestigation into Buyer P’s com-         receipt of commission, on July 30
fore, directly compare in severity/sanc-           plaint, the Agency contacted Brady      2004, Brady paid Seller R $1,000.
tion with other cases.                             by letter requesting that Brady pro-    Seller R has received no additional
                                                   vide a complete copy of her broker      money from Brady in this matter.
            REVOCATIONS                            files for the subject transaction.      Seller R filed a complaint in Lane
   Brady, C. Elizabeth (Eugene)                    Brady responded that she did not        County regarding Brady’s failure to
Broker #960900200                                  represent Buyer P as a real estate      pay her promissory note. Brady did
Default order dated April 1, 2006,                 broker and the only document            not appear at the hearing and Seller
effective April 1, 2006. The order                 Brady provided was an earnest           R obtained a General Judgment
also levied a $500 civil penalty. The              money agreement. Brady stated she       against Brady for $7,097.10. The
Agency received two complaints re-                 had no other real estate documen-       Agency requested that Brady pro-
garding Brady. The first complaint                 tation in the matter other than the     vide documentation from this trans-
involved Brady acting as a real es-                real estate contract provided to her    action, and Brady failed to re-
tate broker and mortgage broker for                as a mortgage broker by Buyer P.        spond. Brady did not notify the
Buyer P. Buyer P gave Brady $1,000                 Brady claimed she did not locate        Agency of the adverse judgment se-
earnest money subject to terms of                  the property for Buyer P and had        cured by Seller R.
the contract, indicating that Buyer                no involvement in the transaction          Violations: ORS 696.301(1),
P had been pre-approved for a VA                   other than as a loan officer. The       (11) and (31), OAR 863-015-
loan sufficient to support his pur-                documents show that Brady con-          0175(1), (2) and (3); and
chase. Buyer P never received loan                 tinued to represent Buyer P as a        OAR 863-015-0180(3) (2001
approval and was forced to file ac-                real estate broker until August 2,      Edition)
tion in small claims court for the                 2004. Brady’s real estate license had
return of his earnest money. Buyer                 been suspended from July 23, 2004          Hamilton, Tina M. (Medford)
P worked with Brady as a real es-                  until April 22, 2005 and Brady was      Property Manager #200111019
tate broker looking for a property                 conducting professional real estate     Stipulated order dated February 3,
to purchase. Brady prepared a pro-                 activity without an active license.     2006, effective February 10, 2006.
forma loan estimate for Buyer P for                   The second complaint was filed       Complainants       alleged    that
the purchase of a $155,000 prop-                   by Seller R who stated that Brady       Hamilton was using client trust
OREGON REAL ESTATE NEWS-JOURNAL                                                                          July 2006          7

funds for Hamilton’s own personal            Shirk, Tonya M. (The Dalles)          the property showing the property
use. Hamilton signed the Stipu-           Broker #981000045)                       was For Sale By Owner. Even
lated Order of Revocation stipulat-       Default order dated May 9, 2006,         though Shirk was licensed at the
ing that the Agency had substan-          effective May 19, 2006. On Janu-         time, Shirk did not advertise the
tial evidence in its files to support,    ary 29, 2002, Shirk was found            subject property in the name of her
after hearing, findings of fact and       guilty of (a) Aggravated Theft in the    principal broker. Shirk removed the
conclusions of law that would re-         First Degree, a Class B Felony; (b)      flyers provided by the listing bro-
sult in the revocation of her license.    two counts of Theft in the First         ker (complainant) and replaced
                                          Degree, a Class C Felony; and (c)        them with the flyers that Shirk pre-
   Johannesen, Rosalie M. (Coos           Forgery in the First Degree, a Class     pared.
Bay) Broker #840200001                    C Felony. On April 29, 2002, Shirk          Violations: ORS 696.301(6),
Stipulated order dated April 11,          filed an appeal of her conviction        (16), (26) and (31), and OAR 863-
2006, effective April 11, 2006.           with the Court of Appeals. The           015-0175(1) (2001 Edition);
Buyer alleged that Johannesen mis-        Court of Appeals affirmed Shirk’s        ORS 696.301(3) (2005 Edition)
represented a lakefront property in       conviction. On May 26, 2004,
Lakeside that complainant at-             Shirk filed a Petition for Review                   SUSPENSIONS
tempted to buy. Buyer alleged that        with the Supreme Court. Shirk’s             Bellamy, Billy C. (Madras)
he gave Johannesen a check for            conviction was again affirmed. The       Broker #821200052
$1,900 and that Johannesen cashed         Agency wrote to Shirk twice re-          Stipulated order dated March 28,
the check and deposited the funds         minding her of the requirement to        2006 issuing a 30 day suspension
into her personal checking account.       report adverse decisions within 21       effective April 1, 2006. Buyer 1
Johannesen knew Buyer from pre-           days. Shirk responded that it had        submitted a complaint to the
vious real estate transactions and        been a very trying time and she of-      Agency regarding Bellamy. Buyer 1
knew that Buyer was interested in         fered to take a lie detector test to     and his wife made an offer to pur-
lakefront property. Johannesen con-       prove that she did nothing wrong.        chase property they were renting
tacted Buyer and represented to           Shirk has failed to provide the re-      from Sellers. Bellamy represented
Buyer that a lakefront property fac-      quested documentation. Shirk also        both Buyer 1 and Sellers. The Sell-
ing foreclosure was available for sale.   failed to notify the Agency of a         ers rejected Buyer 1’s offer and pro-
Johannesen alleged that the prop-         change to her address of record.         vided him with a first right of re-
erty could be purchased for back                                                   fusal in the form of a letter. Subse-
taxes only, which amounted to             The Agency also received a com-          quently, Bellamy was contacted by
$1,900, provided the owner did            plaint from a licensee stating that      a developer (Buyer 2) who was in-
not pay the back taxes timely.            Shirk interfered in a listing ob-        terested in the subject property.
Buyer gave Johannesen $1,900,             tained by the complainant. The           Another real estate agent prepared
which Johannesen deposited into           complainant stated that Shirk was        an offer for Buyer 2 to purchase the
her personal checking account. The        contacting the property owners for       subject property. Buyer 2’s offer
subject property had previously           the listed property, held an open        was accepted by the Sellers.
been listed by Johannesen’s princi-       house on the property without the        Bellamy did not inform Buyer 2 or
pal broker. Johannesen provided           listing broker’s knowledge or con-       Buyer 2’s agent about Buyer 1’s
Buyer with a title company report         sent, and placed her own flyers in       first right of refusal. When Bellamy
for the property. Johannesen did          the listing broker’s flyer box. Shirk    contacted Buyer 1 to schedule an
not have the consent or authoriza-        claimed that she had an arrange-         appointment for Buyer 2 to view
tion to market this property.             ment with the owners of record for       the property, Buyer 1 immediately
Johannesen did not advise her prin-       this property as well as others. Shirk   contacted Bellamy to exercise Buyer
cipal broker about the funds she          arranged for any work, cleanup, etc.     1’s first right of refusal. Bellamy
received from Buyer or about the          for the properties and then shared       instructed Buyer 1 to contact a loan
subject transaction. After several        in the net profit after the proper-      officer to get his documents in or-
months had passed and Buyer did           ties were sold. Shirk did not have a     der. Bellamy recorded nothing in
not have title to the property, Buyer     recorded interest in the subject         writing to document this discus-
discovered through his own re-            property. The recorded owner listed      sion. Buyer 1 contacted an attor-
search that the subject property was      the property with the complainant.       ney and obtained loan approval and
not for sale or in a foreclosure sta-     Shirk attempted to have the owner        qualification. The property subse-
tus and had never been in a fore-         cancel his listing with the com-         quently sold to Buyer 2. Bellamy
closure status.                           plainant in order to list with a bro-    also conducted property manage-
   Violations: ORS 696.301(1),            kerage where Shirk’s father was li-      ment activity between the Sellers
(10), (17), and (24) (2003 Edition)       censed. Shirk prepared a flyer for       ADMINISTRATIVE ACTIONS: continued on page 8
8       July 2006                                                        OREGON REAL ESTATE NEWS-JOURNAL

ADMINISTRATIVE ACTIONS: continued from page 7   pensation issues remained, Bird did      times prior to closing. After the
and Buyer 1 without benefit of a                not address the repairs in the new       Buyer’s third request, Culley in-
property management agreement.                  offer. The Buyer was again denied        formed the Buyer that he had taken
  Violations: ORS 696.301(10),                  a loan due to the condition of the       care of the problems cited in the
(24) and 696.805(2)(c); and OAR                 property. Seller cancelled her list-     report. Culley did not send a copy
863-015-0020(1) (2003 Editions)                 ing and the transaction was termi-       of the inspection report to the
                                                nated. After the transaction termi-      Buyer and did not review the find-
            REPRIMANDS                          nated, Buyer’s father told Bird that     ings of the report with the Buyer
   Bird, Wendy L. (McMinnville)                 he was going to put a lien on            or convey its contents to her. After
Broker #970700045                               Seller’s property. Buyer’s father con-   closing, the Buyer moved into the
   Stipulated order dated February              tacted Seller asking her to pay for      property and was dissatisfied with
3, 2006. Seller alleged that Bird               the new roof, which Seller refused.      specific conditions of the property,
failed to meet her obligations to her              Violations: OAR 863-015-              some of which had been noted in
client when Bird represented Seller.            0135(5); and ORS 696.805(2)(a)           the inspector’s report.
Seller alleged that Bird arranged for                                                       Violations: ORS 696.810(3)(a)
Seller’s property to be re-roofed                  Culley, Ronald C. (North Bend)        and (c)
without Seller’s authorization and              Broker #870600046
without including the roof repair                  Stipulated order dated April 11,         Smith, Julie Mansfield (Kim-
terms in the sale agreement. Bird               2006. Buyer alleged that Culley          berly) Broker #950300098
listed Seller’s property as a fixer.            failed to give her a copy of the home       Stipulated order dated April 13,
Buyer’s father contacted Bird on                inspection report prior to closing.      2006. Sellers complained that
behalf of Buyer as Buyer was out of             In July 2004, Buyer made a full-         Smith misrepresented a portion of
state. Buyer’s father, who was a li-            price offer, through Culley, on          the property that they were selling
censed general contractor, noticed              property located in Coos Bay, Or-        (8 acres adjoining property owned
that the property had worn out                  egon. Buyer lived in California.         by Smith) as “not for sale” and that
roofing. Buyer made an offer which              The offer included that a profes-        the property was improperly mar-
was accepted by Seller. Escrow was              sional home inspection be con-           keted. Sellers listed their property
opened and the earnest money                    ducted. The time requirements re-        in Kimberly, Oregon consisting of
promissory note was redeemed.                   garding home inspections and a           22 acres with Smith. The listed
Bird advised Buyer’s father that the            provision stating that a buyer’s         property was adjacent to property
lender could require the roof repairs           timely written disapproval of the        owned by Smith. Smith had been
be made before the Buyer could                  inspection report would automati-        in communication with the Sellers
obtain a loan. Buyer’s loan was de-             cally terminate the transaction were     before and during the period of the
nied as the property did not qualify            cited in the Professional Inspection     listing agreement regarding
for a loan due, in part, to the poor            Addendum. The addendum stated            Smith’s acquisition of 8 acres of the
roof condition. Buyer sought fi-                that the inspection would be com-        subject property. Sellers were aware
nancing from a second lender. One               pleted and the inspection report         of Smith’s wishes to purchase the 8
of the conditions of a loan was that            delivered to the buyer within 10         acres and orally authorized Smith
the roof needed to be repaired.                 business days after written accep-       to market and advertise only the
Buyer’s father volunteered to put a             tance of the offer. The Buyer’s offer    remaining 14 acres. Smith was told
new roof on the property. The Seller            was accepted with an October clos-       by the Sellers that she could pur-
vacated the property and Buyer’s                ing date. A home inspection was          chase the 8 acres. However, the en-
father replaced the roof. Seller was            not completed until October 4,           tire 22 acres was listed since it was
not aware that the roof was re-                 2004 and Culley did not prepare          legally described as such. Although
placed. Bird advised Buyer’s father             an addendum extending the in-            Smith verbally discussed her pur-
that the Seller had not agreed to               spection period. The inspector did       chase of the 8 acres from the Sell-
pay for a new roof. Buyer’s father              not send a copy of the report to the     ers, there was no written agreement
expected to be paid for labor and               Buyer, but did send one to Culley        to that effect between the parties
materials out of closing. Bird did              with a note from the inspector to        at the inception of the listing, nor
not address in writing the roof re-             send a copy of the report to the         was a listing price set on the entire
placement or who would pay for it.              Buyer. Culley did not consult with       22 acres. Smith informed potential
A new offer was written between the             his principal broker regarding the       purchasers that although the tax
parties on the recommendation of                inspector’s instruction. Culley in-      map showed 22 acres, she had an
the Buyer’s new lender. Despite                 formed Buyer that the inspection         oral agreement with the Sellers to
knowing that the Buyer’s father                 had been completed. Buyer asked          purchase 8 of those acres. The list-
had replaced the roof and that com-             Culley for a copy of the report three    ing expired and was not renewed.
OREGON REAL ESTATE NEWS-JOURNAL                                                                        July 2006           9

Smith subsequently entered into a        did not call the escrow company to     that the buyer was changing from
buyer-broker agreement with a            verify whether closing had occurred    the original Buyers to the builder,
third party for them to purchase         before he entered the property. The    which was incorrect. AmeriTitle
the entire 22 acres from the Sell-       transaction closed on September        faxed escrow instructions to the real
ers. Smith did not represent the         22, 2003.                              estate agent to obtain the Buyers’
Sellers in this offer. The transaction      Violations: ORS 696.810(2)(a)       signatures stating that the balance
closed on the entire 22 acres with       and ORS 696.301(28) (2001 Edi-         of the purchase price received was
the third party. Approximately ten       tion)                                  to be applied toward the buyer’s
months after the purchase, Smith                                                funds for the transaction between
acquired the 8 acres from the buyer              CIVIL PENALTIES                the Seller and the builder. The in-
through a property line adjustment.         Adams, Darwin L. (Idaho)            structions stated that the funds
   Violation ORS 696.805(3)(a)           Reciprocal Broker #200204235           were to be considered third-party
                                         Stipulated order dated April 4,        gift funds and that any refund shall
   Seymour, Richard A. (Gresham)         2006 issuing a $100 civil penalty.     be made payable to the builder.
Broker #941100199                        Adams failed to renew his real es-     The escrow instructions were signed
   Stipulated order dated April 11,      tate license for five months while     by the Buyers.
2006. Seller alleged that Seymour,       continuing to conduct professional        Violation: ORS 696.581(2)
who represented himself and his          real estate activity. Adams is a re-
wife as buyers in a transaction to       ciprocal broker and conducted only        Br yan, Donald P. (Por tland)
purchase property from Seller, en-       one transaction in Oregon during       Broker #891000167
tered the subject property to begin      the time he was unlicensed.            Stipulated order dated April 3,
remodeling work prior to the close          Violation: OAR 863-15-              2006 issuing a $100 civil penalty.
of the transaction without first ob-     0050(2).                               Bryan failed to renew his real es-
taining Seller’s permission.                                                    tate license for four months while
Seymour’s wife, through Seymour,            AmeriTitle (Bend) Escrow Agent      continuing to conduct professional
made an offer to purchase the sub-       #960300017                             real estate activity. Bryan works
ject property from Seller on August      Stipulated order dated February        with a forestry consulting firm
12, 2003, which was accepted on          22, 2006 issuing a $3,000 civil        which serves the forest products
August 17, 2003. The offer in-           penalty. A complaint was received      industry exclusively, and real estate
cluded a promissory note for             regarding a property transaction.      sales transactions are not its pri-
$1,000 which was to be redeemed          The property being purchased was       mary function. Bryan was involved
three days after mutual acceptance       a portion of a larger parcel. The      in only one real estate transaction
and then deposited into escrow.          Seller was unable to have the prop-    during the time he was unlicensed.
Seymour was later added as a buyer.      erty surveyed and partitioned be-         Violation: OAR 863-15-
Seymour’s wife did not redeem her        fore the closing date. The parties     0050(2).
promissory note timely. The earnest      decided to transfer the entire par-
money was not deposited into es-         cel to the builder, so the builder        Courtney, Christopher S. (Eu-
crow. Seymour did not notify             could obtain a building permit and     gene) Broker #200003150
Seller’s broker that the promissory      commence construction for the          Stipulated order dated April 3,
note had not been redeemed or that       Buyers. Prior to the open of escrow,   2006 issuing a $100 civil penalty.
the earnest money was not depos-         an addendum was executed by the        Courtney failed to renew his real
ited into escrow. The Seymours           parties which stated that at closing   estate license for one month while
signed closing documents on Sep-         title was to be placed in the          continuing to conduct professional
tember 18, 2003. Seymour ex-             builder’s name. The intent of the      real estate activity.
pected the transaction to close the      addendum was not to make the              Violation: OAR 863-15-
following day upon funding of the        builder the buyer, but only to al-     0050(2).
transaction. On September 19,            low the builder to obtain a build-
2003, Seymour entered the subject        ing permit. The Buyers remained           Eggers, Robert A. (Bend)
property and removed some carpet-        as the actual buyers of the prop-      Broker #200111054
ing, a stove and some cabinets. The      erty. Escrow was opened at             Stipulated order dated April 11,
transaction had not yet closed be-       AmeriTitle and AmeriTitle received     2006 issuing a $2,600 civil pen-
cause funding had not been               the Buyers’ earnest money deposit.     alty. Eggers failed to renew his real
achieved. Seymour did not obtain         AmeriTitle also received a check       estate license for six months while
permission from the seller or the        from the Buyers for the balance of     continuing to conduct professional
seller’s broker to enter the subject     the purchase price. Based on the       real estate activity.
property prior to closing. Seymour       addendum, AmeriTitle assumed            ADMINISTRATIVE ACTIONS: continued on page 10
10      July 2006                                                         OREGON REAL ESTATE NEWS-JOURNAL

ADMINISTRATIVE ACTIONS: continued from page 9   failed to renew her real estate license   denying a real estate broker’s license
   Violation: OAR 863-15-0050(2).               for a period of time while continu-       application. On July 6, 2005, Mor-
                                                ing to conduct professional real es-      gan completed his application and
   Herring, Jackie D. (Bend) Broker             tate activity.                            disclosed that he had pled guilty to
#840300066                                          Violation: OAR 863-15-0050(2).        2 counts of Misdemeanor Sex Abuse.
Stipulated order dated April 11,                                                          The Agency’s background investiga-
2006 issuing a $600 civil penalty.                 Volk, Michael E. (Portland)            tion disclosed that Morgan was in-
Herring failed to renew his real es-            Broker #930400182                         dicted on 3 counts of Sexual Abuse
tate license for two months while               Stipulated order dated March 27,          in the Second Degree and pled guilty
continuing to conduct professional              2006 issuing a $100 civil penalty.        to 2 counts on March 3, 2002.
real estate activity.                           Volk failed to renew his real estate         Violations: ORS 696.022(5),
   Violation: OAR 863-15-0050(2).               license for ten months while continu-     696.301(25) (2003 Edition)
                                                ing to conduct professional real es-
   Schaeffer, Michael R. (Portland)             tate activity. Volk works with a for-        Timberlake, Charles Wayne
Property Manager #780700020                     estry consulting firm which serves the    (Washington)             Applicant
Stipulated order dated May 12,                  forest products industry exclusively,     #200505287
2006 issuing a $100 civil penalty.              and real estate sales transactions are    Default order dated March 30, 2006
Schaeffer failed to renew his real es-          not its primary function. Bryan was       denying a membership camping con-
tate license for a period of time while         involved in only one real estate trans-   tract registration application.
continuing to conduct professional              action during the time he was unli-       Timberlake completed his applica-
real estate activity.                           censed.                                   tion and disclosed that he had pled
   Violation: OAR 863-15-0050(2).                  Violation: OAR 863-15-0050(2).         guilty of embezzlement of pension
                                                                                          funds in 1994. Timberlake is still
   Stone, Susan E. (Beaverton)                                 OTHER                      paying restitution.
Broker #900200277                                 Morgan, Glenn Alan (Sherwood)              Violation: ORS 94.980(3)(a)(c)
Stipulated order dated May 3, 2006              Applicant #200507263
issuing a $100 civil penalty. Stone             Hearing order dated April 28, 2006

          Editor’s Note: The following information was              could result in civil penalties of up to 25% of
      provided by the Farm Service Agency (FSA) of                  the fair market value of the property. The FSA
      the United State Department of Agriculture                    asks real estate licensees to remind clients who
      (USDA). For more information, contact the                     might fall into this category of these report-
      Washington/Columbia County FSA office at                      i n g r e q u i r e - ments.
      (503) 648-3174, extension 2, or visit
          The Agricultural Foreign Investment Dis-
      closure Act (AFIDA) requires all foreign per-
      sons who acquire, transfer, or hold interest in
      U.S. agricultural land to report their holdings
      to the Secretary of Agriculture
      within 90 days of the closing..
      This law includes corporations
      if 10% or more of their stock
      is held by foreign investors.
      Reporting is done by com-
      pleting an FSA-153 form,
      which is available at any FSA
      o f f i c e . Fa i l u re t o r e p o rt
OREGON REAL ESTATE NEWS-JOURNAL                                                                           July 2006       11

   A “condominium” is a special form        the common elements to which each         Act under ORS Chapter 90.
of property ownership which is cre-         has access, as well as a copy of the         Under the Oregon Condominium
ated and governed in Oregon by stat-        bylaws must be recorded simulta-          Act, the developer must provide resi-
ute (ORS 100.005 to 100.910 and             neously with the declaration.             dential purchasers with a condo-
100.990), known as the “Oregon                 The Oregon Condominium Act,            minium disclosure statement and a
Condominium Act.” A typical con-            the declaration and the bylaws con-       unit sales agreement, in addition to
dominium is a combination of two            trol the rights and obligations of the    a number of other documents. In
kinds of ownership. The owner of a          unit owners with respect to each          addition to statutory provisions un-
condominium unit holds title to his         other, the common elements and            der the Act, sales of condominiums
individual unit together with an un-        their respective units. The provisions    are also governed by the Real Estate
divided interest in common with all         of these documents are intended to        Licensing statutes under ORS Chap-
unit owners in the “common ele-             be, and in most cases are, enforceable    ter 696 and the Conveyancing stat-
ments,” that is, the land and those         in a court of law. The Oregon Con-        utes under ORS Chapter 93.
parts of the building or buildings          dominium Act requires that the con-          The State of Oregon Real Estate
intended for common use such as the         dominium association be organized         Agency reviews and approves all con-
foundations, framing, siding, roofs,        to serve as a means through which         dominiums. A condominium filing
stairways, utility services and the like,   the unit owners may take action with      with the state is extensive and in-
and may also include other facilities       regard to the administration, man-        cludes, but is not limited to, the fol-
intended to be used by all unit own-        agement and operation of the con-         lowing documents: declaration, by-
ers such as landscaping and parking         dominium. Each unit owner is au-          laws, disclosure statement, unit sales
areas. Each unit owner is entitled to       tomatically a member of the associa-      agreement, title report, condo-
the exclusive ownership and posses-         tion.                                     minium filing forms and a plat. The
sion of his unit. The undivided in-            A condominium may have resi-           county in which the property is lo-
terest in the common elements is in-        dential or commercial units or both       cated also reviews and approves the
separable from the ownership of the         (mixed-use). A condominium may            plat and approves the declaration for
individual unit.                            be new construction or an existing        conformance to the plat.
   A condominium is created by re-          building may be converted to the             Due to the legal complexity of a
cording a condominium declaration           condominium form of ownership.            condominium filing, these docu-
in the office of the recording officer      Condominium conversions require           ments are typically filed by experi-
of the county in which the property         the developer to follow statutory pro-    enced condominium attorneys. A
is located. A plat of the property          cedures under the Oregon Condo-           condominium filing package may be
showing the vertical and horizontal         minium Act that protect the rights        obtained by contacting the Oregon
boundaries of each unit in a build-         of existing tenants, in addition to the   Real Estate Agency at (503) 378-
ing including unit designation, loca-       complying with the Landlord Tenant        4170, ext. 239.
tion and dimensions of each unit and

                            HAVE YOUR LICENSE ISSUED MORE QUICKLY
       What is the secret to have a license issued (or renewed, transferred, changed) quickly? It is simple: Use
    the proper form, make sure the form is complete including all necessary signatures, include any required
    documents, and ensure proper payment is enclosed (if paying by check it must be for the correct amount,
    signed and made payable to the Real Estate Agency). Additionally, sending all documents, forms and
    payment in one package will also help expedite your transaction.
       We encourage submitting Background Check Applications early, as they can take two to three months
    to process. If there is an issue which requires review and further investigation, it will take even longer to
    complete the process. Background Check Applications are considered incomplete if all the required docu-
    mentation (e.g. detailed written explanation, employment history, reference letters, official documents)
    are not included, which further delays the process until the required documentation is submitted.
       Please help us to better serve you by following the above steps. If you have any questions, call the
    Licensing Section at (503) 378-4170, selection 0.
       This article is adapted from an article published by the State of Alabama Real Estate Commission.
12   July 2006                                 OREGON REAL ESTATE NEWS-JOURNAL
                            Periodicals Postage Paid at Salem, Oregon

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