An Act concerning real estate transactions; relating to agency relationships; repealing the brokerage relationships in real estate transactions act; amending K.S.A. 1995 Supp. 58- 3035, 58-3035, as amended by section 19 of this bill, 58-3036, 58-3037, 58-3042, 58- 3050, 58-3050, as amended by section 6 of this bill, 58-3062, 58-3062, as amended by section 7 of this bill, 58-3064, 58-3064, as amended by section 8 of this bill, 58-3065, 58-3065, as amended by section 9 of this bill, 58-3068, 58-3068, as amended by section 10 of this bill, 58-30,110, 74-4202 and 74-4202, as amended by section 11 of this bill, and repealing the existing sections; also repealing K.S.A. 1995 Supp. 58-3035a, 58-3039a and 58-30,101 through 58-30,112.

Be it enacted by the Legislature of the State of Kansas:

Section 1. K.S.A. 1995 Supp. 58-30,101 is hereby amended to read as follows: 58-30,101. (a) K.S.A. 1995 Supp. 58-30,101 through 58-30,112 shall be known and may be cited as the brokerage relationships in real estate transactions act.

(b) Any application of this act to transactions regarding the sale or lease of commercial or investment real estate property shall be suspended and shall not be enforceable on and after the effective date of this act. Commercial or investment real estate property means any real estate for which the present or intended use is other than one to four residential units.

(c) The provisions of K.S.A. 1995 Supp. 58-30,101 through 58-30,112 shall be and hereby are abolished on July 1, 1997.

New Sec. 2. (a) The chairperson of the real estate commission shall appoint a real estate task force for the purpose of studying the issues involved in the brokerage relationships in real estate transactions act, K.S.A. 1995 Supp. 58-30,101 through 58-30,112, and amendments thereto.

(b) The task force shall present its report and recommendations to the speaker of the house of representatives and the president of the senate on or before January 1, 1997.

(c) Task force members shall not be paid compensation, subsistence allowances, mileage or other expenses for serving on such task force.

Sec. 3. K.S.A. 1995 Supp. 58-3036 is hereby amended to read as follows: 58-3036. Unless exempt from this act under K.S.A. 58-3037 and amendments thereto, no person shall:

(a) Directly or indirectly engage in or conduct or represent that such person engages in or conducts the business of a broker, associate broker or salesperson within this state unless such person is licensed as such a broker, associate broker or salesperson in accordance with this act.

(b) Directly or indirectly act or represent that such person acts as a broker, associate broker or salesperson within this state unless such per- son is licensed as such a broker, associate broker or salesperson in accor- dance with this act.

(c) Perform or offer, attempt or agree to perform any act described in subsection (e) (f) of K.S.A. 58-3035 and amendments thereto, whether as a part of a transaction or as an entire transaction, unless such person is licensed pursuant to this act.

Sec. 4. K.S.A. 1995 Supp. 58-3037 is hereby amended to read as follows: 58-3037. The provisions of this act shall not apply to:

(a) Any person, other than a person licensed under this act, who di- rectly performs any of the acts within the scope of this act with reference to such person's own property.

(b) Any person who directly performs any of the acts within the scope of this act with reference to property that such person is authorized to transfer in any way by a power of attorney from the owner, provided that such person receives no commission or other compensation, direct or indirect, for performing any such act.

(c) Services rendered by an attorney licensed to practice in this state in performing such attorney's professional duties as an attorney.

(d) Any person acting as receiver, trustee in bankruptcy, administra- tor, executor or guardian, or while acting under a court order or under the authority of a will or a trust instrument or as a witness in any judicial proceeding or other proceeding conducted by the state or any govern- mental subdivision or agency.

(e) Any officer or employee of the federal or state government, or any political subdivision or agency thereof, when performing the official duties of the officer or employee.

(f) Any multiple listing service wholly owned by a nonprofit organi- zation or association of brokers.

(g) Any nonprofit referral system or organization of brokers formed for the purpose of referral of prospects for the sale or listing of real estate.

(h) Railroads or other public utilities regulated by the state of Kansas, or their subsidiaries, affiliated corporations, officers or regular employees, unless performance of any of the acts described in subsection (e) (f) of K.S.A. 58-3035 and amendments thereto is in connection with the sale, purchase, lease or other disposition of real estate or investment therein unrelated to the principal business activity of such railroad or other public utility or affiliated or subsidiary corporation thereof.

(i) The sale or lease of real estate by an employee of a corporation which owns or leases such real estate, if such employee owns not less than 5% of the stock of such corporation.

(j) The sale or lease of new homes by a person, partnership, associ- ation or domestic corporation who constructed such homes, but the pro- visions of this act shall apply to the sale or lease of any such homes by any employee of such person, partnership or association or by any em- ployee of such corporation who owns less than 5% of the stock of such corporation.

(k) The lease of real estate for agricultural purposes.

Sec. 5. K.S.A. 1995 Supp. 58-3042 is hereby amended to read as follows: 58-3042. (a) No real estate license shall give authority to any person other than the person to whom the license is issued.

(b) No license shall be granted to a corporation, partnership, associ- ation or limited liability company. Each person who is an officer of a corporation or a member of a partnership, association or limited liability company and who performs any act described in subsection (e) (f) of K.S.A. 58-3035 and amendments thereto shall be a licensed broker, and each person who is employed by or associated with a corporation, part- nership, association or limited liability company and who performs any act described in subsection (e) (f) of K.S.A. 58-3035 and amendments thereto shall be a licensed broker or licensed salesperson.

Sec. 6. K.S.A. 1995 Supp. 58-3050 is hereby amended to read as follows: 58-3050. (a) The license of any licensee may be revoked, sus- pended or restricted or a licensee may be censured, if:

(1) The commission finds that the license has been obtained by false or fraudulent representation or that the licensee has committed a viola- tion of this act or rules and regulations adopted hereunder, or the bro- kerage relationships in real estate transactions act or rules and regulations adopted thereunder as such act governs the sale or lease of real estate that is one to four residential units, whether the licensee acted as an agent or a principal in the real estate transaction;

(2) the licensee has entered a plea of guilty or nolo contendere to, or has been convicted of: (A) Forgery, embezzlement, obtaining money un- der false pretenses, larceny, extortion, conspiracy to defraud or any other similar offense; (B) a crime involving moral turpitude; or (C) any felony charge; or

(3) the licensee has been finally adjudicated and found to be guilty of violation of the federal fair housing act (42 U.S.C. 3601 et seq.) or K.S.A. 44-1015 through 44-1029, and amendments thereto.

(b) In addition to or in lieu of any other administrative, civil or crim- inal remedy provided by law, the commission, in accordance with the Kansas administrative procedure act and upon a finding that a licensee has violated a provision of this act or rules and regulations adopted here- under, or the brokerage relationships in real estate transactions act or rules and regulations adopted thereunder as such act governs the sale or lease of real estate that is one to four residential units, may impose on such licensee a civil fine not exceeding $500 for each violation.

(c) If a broker or salesperson has been declared disabled by a court of competent jurisdiction, the commission shall suspend the broker's or salesperson's license for the period of disability.

(d) No complaint alleging violation of this act or rules and regulations adopted hereunder, or the brokerage relationships in real estate trans- actions act or rules and regulations adopted thereunder as such act gov- erns the sale or lease of real estate that is one to four residential units, shall be commenced more than three years from the date of the occur- rence which is the subject of the complaint.

(e) All administrative proceedings pursuant to this section shall be conducted in accordance with the Kansas administrative procedure act.

(f) Notwithstanding any provision of this act or the brokerage rela- tionships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units, to the contrary, the commission may use emergency adjudicative proceedings, as provided by K.S.A. 77-536 and amendments thereto, to summarily suspend the license of any licensee if the commission has reasonable cause to believe that the licensee's trust account is in unsound condition or that the li- censee is misappropriating funds belonging to other persons.

(g) If a licensee has entered a plea of guilty or nolo contendere to, or has been convicted of, any felony charge, the commission may use emer- gency adjudicative proceedings, as provided by K.S.A. 77-536 and amend- ments thereto to suspend, revoke or restrict the licensee's license.

(h) When the real estate license of an individual is revoked and that individual's name is included in the trade or business name of a real estate brokerage business, the commission may deny continued use of the trade or business name if, in the opinion of the commission, it would be con- fusing or misleading to the public.

If the revocation of the individual's license is appealed to district court and a stay of the commission's order is granted by the court, the com- mission may not deny continued use of the trade or business name until such time as the district court upholds the order of the commission.

Sec. 7. K.S.A. 1995 Supp. 58-3062 is hereby amended to read as follows: 58-3062. (a) No licensee, whether acting as an agent or a prin- cipal, shall:

(1) Intentionally use advertising that is misleading or inaccurate in any material particular or that in any way misrepresents any property, terms, values, policies or services of the business conducted, or uses the trade name, collective membership mark, service mark or logo of any organization owning such name, mark or logo without being authorized to do so.

(2) Fail to account for and remit any money which comes into the licensee's possession and which belongs to others.

(3) Misappropriate moneys required to be deposited in a trust ac- count pursuant to K.S.A. 58-3061 and amendments thereto, convert such moneys to the licensee's personal use or commingle the money or other property of the licensee's principals with the licensee's own money or property, except that nothing herein shall prohibit a broker from having funds in an amount not to exceed $100 in the broker's trust account to pay expenses for the use and maintenance of such account.

(4) Accept, give or charge any rebate or undisclosed commission.

(5) Pay a referral fee to a person who is properly licensed as a broker or salesperson in another jurisdiction or who holds a corporate real estate license in another jurisdiction if the licensee knows that the payment of the referral fee will result in the payment of a rebate by the out-of-state licensee.

(6) Represent or attempt to represent a broker without the broker's express knowledge and consent.

(7) Act in a dual capacity of agent and undisclosed principal in any transaction regarding the sale or lease of commercial or investment real estate property.

(8) Guarantee or authorize any person to guarantee future profits that may result from the resale of real property.

(8) (9) Place a sign on any property offering it for sale or lease without the written consent of the owner or the owner's authorized agent.

(9) (10) Offer real estate for sale or lease without the knowledge and consent of the owner or the owner's authorized agent or on terms other than those authorized by the owner or the owner's authorized agent.

(10) (11) Induce any party to break any agency agreement or contract of sale or lease.

(12) Solicit a listing or negotiate a sale, exchange or lease of commer- cial or investment real estate property directly with an owner or lessor if the licensee knows that such owner or lessor has, with regard to the prop- erty, a written agency agreement granting an exclusive right to sell or lease to another broker.

(13) Solicit an agency agreement or negotiate a sale, exchange or lease of commercial or investment real estate property directly with a buyer or lessee if the licensee knows that such buyer or lessee has a written agency agreement granting exclusive representation to another broker.

(14) Except for a commercial or investment real estate property or any property owned by any agency of the federal government, fail to obtain a written agency agreement, including a fixed date of expiration, signed by the party to be represented and by the licensee or fail to furnish a copy of the agreement to the principal within a reasonable time. The licensee shall not assign, sell or otherwise transfer a written agency agree- ment to another broker without the express written consent of all parties to the original listing agreement.

(15) In any transaction regarding the sale of commercial or invest- ment real estate property if the licensee represents the seller, fail to dis- close to a prospective buyer that: (A) The licensee is or will be acting as agent of the seller with the duty to represent the seller's interest; (B) the licensee will not be the agent of the prospective buyer; and (C) information given to the licensee will be disclosed to the seller. The disclosure shall be made orally or in writing when the licensee agrees to assist the prospective buyer to locate and inspect property and shall be made in any contract for sale and in any lot reservation agreement.

(16) In any transaction regarding the sale of commercial or invest- ment real estate property if the licensee represents the buyer, fail to dis- close to a prospective seller or seller's agent that: (A) The licensee is or will be acting as agent of the buyer with the duty to represent the buyer's interest; (B) the licensee will not be the agent of the seller; and (C) infor- mation given to the licensee will be disclosed to the buyer. The disclosure shall be made orally or in writing no later than the first showing of the property and shall be made in any contract for sale and in any lot res- ervation agreement.

(17) In any transaction regarding the sale of commercial or invest- ment real estate property if the licensee represents both the buyer and seller, the licensee shall immediately disclose in writing: (A) That the li- censee is acting as agent for both buyer and seller; and (B) the compen- sation arrangement. The disclosure shall be signed by both the buyer and the seller. If the exclusive right to sell agreement and the buyer's agency agreement include the disclosure of the possibility of dual agency, the written disclosure, for each specific transaction, shall be signed by the buyer no later than the first showing of the property and by the seller no later than the presentation of the offer to purchase. In addition, the dis- closure of the agency relationship between all licensees involved and the principals shall be included in any contract for sale and in any lot res- ervation agreement.

(11) (18) Offer or give prizes, gifts or gratuities which are contingent upon an agency agreement or the sale, purchase or lease of real estate.

(19) Enter into a listing agreement on commercial or investment real estate property in which the broker's commission is based upon the dif- ference between the gross sales price and the net proceeds to the owner.

(12) (20) Fail to see that financial obligations and commitments be- tween the parties to an agreement to sell, exchange or lease real estate are in writing, expressing the exact agreement of the parties or to provide, within a reasonable time, copies thereof to all parties involved.

(13) (21) Procure a signature to a purchase contract which has no definite purchase price, method of payment, description of property or method of determining the closing date.

(14) (22) Include in any agency agreement an authorization to sign or initial any document on behalf of the licensee's principal in a commer- cial or investment real estate property transaction or authorization to act as attorney-in-fact for the principal. commit forgery or, unless authorized to do so by a duly executed power of attorney, sign or initial any contrac- tual agreement on behalf of another person in a real estate transaction.

(15) (23) Engage in fraud or make any substantial misrepresentation.

(16) (24) Represent to any lender, guaranteeing agency or any other interested party, either verbally or through the preparation of false doc- uments, an amount in excess of the true and actual sale price of the real estate or terms differing from those actually agreed upon.

(17) (25) Fail to make known to any purchaser or lessee any interest the licensee has in the real estate the licensee is selling or leasing or to make known to any seller or lessor any interest the licensee will have in the real estate the licensee is purchasing or leasing.

(18) (26) Fail to inform both the buyer, at the time an offer is made, and the seller, at the time an offer is presented, that certain closing costs must be paid and the approximate amount of such costs.

(19) (27) Fail without just cause to surrender any document or in- strument to the rightful owner.

(20) (28) Accept anything other than cash as earnest money unless that fact is communicated to the owner prior to the owner's acceptance of the offer to purchase, and such fact is shown in the purchase agree- ment.

(21) (29) Fail to deposit any check or cash received as an earnest money deposit or as a deposit on the purchase of a lot within five business days after the purchase agreement or lot reservation agreement is signed by all parties, unless otherwise specifically provided by written agreement of all parties to the purchase agreement or lot reservation agreement, in which case the licensee shall deposit the check or cash received on the date provided by such written agreement.

(22) (30) Fail in response to a request by the commission or the di- rector to produce any document, book or record in the licensee's posses- sion or under the licensee's control that concerns, directly or indirectly, any real estate transaction or the licensee's real estate business.

(31) In any transaction regarding the sale of commercial or invest- ment real estate property if the licensee represents the seller, fail to promptly submit any written offer to the licensee's principal when such offer is received prior to the closing of the sale or fail to promptly submit to the prospective buyer or buyer's agent any counteroffer made by the seller, including any back-up offers properly identified as such.

(32) In any transaction regarding the sale of commercial or invest- ment real estate property if the licensee represents the buyer, fail to promptly submit any written offer to the seller or seller's agent or fail to promptly submit to the licensee's principal any counteroffer made by the seller, including any back-up offers properly identified as such.

(23) (33) Refuse to appear or testify under oath at any hearing held by the commission.

(24) (34) Demonstrate incompetency to act as a broker, associate bro- ker or salesperson.

(35) In any transaction regarding the sale or lease of commercial or investment real estate property fail to disclose, or ascertain and disclose, to any person with whom the licensee is dealing, any material information which relates to the property with which the licensee is dealing and which such licensee knew or should have known.

(25) (36) Knowingly receive or accept, directly or indirectly, any re- bate, reduction or abatement of any charge, or any special favor or ad- vantage or any monetary consideration or inducement, involving the is- suance of a title insurance policy or contract concerning which the licensee is directly or indirectly connected, from a title insurance company or title insurance agent, or any officer, employee, attorney, agent or so- licitor thereof.

(26) (37) Engage in the purchase of one-, two-, three- or four-family dwellings, including condominiums and cooperatives, or the acquisition of any right, title or interest therein, including any equity or redemption interests, if:

(A) (i) At the time of such purchase, the dwellings are subject to a right of redemption pursuant to foreclosure of a mortgage on such dwell- ings; (ii) the licensee fails to give written notice of the purchase, within 20 days thereafter, to the mortgage holder or judgment creditor who held such mortgage; and (iii) the licensee, unless otherwise required by law or court order, fails to apply any rent proceeds from the dwellings to the judgment lien arising from the foreclosure of such mortgage, as payments become due under the loan, regardless of whether the licensee is obli- gated to do so;

(B) (i) the dwellings are subject to a loan which is secured by a mort- gage and which is in default at the time of such purchase or in default within one year after such purchase; (ii) the licensee fails to give written notice of the purchase, within 20 days thereafter, to the mortgage holder; and (iii) the licensee, unless otherwise required by law or court order, fails to apply any rent proceeds from the dwellings to the mortgage as the payments come due, regardless of whether the licensee is obligated on the loan; or

(C) the licensee fails to notify, at the time of rental, any person rent- ing any such dwelling of the extent and nature of the licensee's interest in such dwelling and the probable time until possession will be taken by the mortgage holder or judgment creditor.

(38) Commit forgery or, unless authorized to do so by a duly executed power of attorney, sign or initial any contractual agreement on behalf of another person in a real estate transaction.

(b) In any transaction regarding the sale or lease of commercial or investment real estate property failure to comply with any requirement of subsection (a)(14), (15), (16) or (17) or their corollary rules and reg- ulations shall not by itself render any agreement void or voidable nor shall it constitute a defense to any action to enforce such agreement or any action for breach of such agreement.

(c) The commission may provide suggested forms of agency disclosure and agency agreements and, by rules and regulations, provide such other prohibitions, limitations and conditions relating thereto as the commission may prescribe for transactions regarding the sale or lease of commercial or investment real estate property.

(d) No salesperson or associate broker shall:

(1) Accept a commission or other valuable consideration from anyone other than the salesperson's or associate broker's employing broker or the broker with whom the salesperson or associate broker is associated.

(2) Fail to place, as soon after receipt as practicable, any deposit money or other funds entrusted to the salesperson or associate broker in the custody of the broker whom the salesperson or associate broker rep- resents.

(c) (e) No broker shall:

(1) Pay a commission or compensation to any person for performing the services of an associate broker or salesperson unless such person is licensed under this act and employed by or associated with the broker, except that nothing herein shall prohibit the payment of a referral fee to a person who is properly licensed as a broker or salesperson in another jurisdiction relating to a transaction regarding the sale or lease of com- mercial or investment real estate property.

(2) Fail to deliver to the seller in every real estate transaction, at the time the transaction is closed, a complete, detailed closing statement showing all of the receipts and disbursements handled by the broker for the seller, or fail to deliver to the buyer a complete statement showing all money received in the transaction from such buyer and how and for what the same was disbursed, or fail to retain true copies of such state- ments in the broker's files, except that the furnishing of such statements to the seller and buyer by an escrow agent shall relieve the broker's re- sponsibility to the seller and the buyer.

(3) Fail to properly supervise the activities of an associated or em- ployed salesperson or associate broker.

(4) Lend the broker's license to a salesperson, or permit a salesperson to operate as a broker.

(5) Fail to provide to the principal a written report every 30 days, along with a final report, itemizing disbursements made by the broker from advance listing fees.

(d) (f) If a purchase agreement provides that the earnest money be held by an escrow agent other than a real estate broker, unless otherwise specifically provided by written agreement of all parties to the purchase agreement, no listing broker shall:

(1) Fail to deliver the purchase agreement and earnest money deposit to the escrow agent named in the purchase agreement within five business days after the purchase agreement is signed by all parties; or

(2) fail to obtain and keep in the transaction file a receipt from the escrow agent showing date of delivery of the purchase agreement and earnest money deposit.

(e) (g) Nothing in this section shall be construed to grant any person a private right of action for damages or to eliminate any right of action pursuant to other statutes or common law.

Sec. 8. K.S.A. 1995 Supp. 58-3064 is hereby amended to read as follows: 58-3064. Whenever any person has engaged in any act or practice that constitutes a violation of this act or rules and regulations adopted hereunder or the brokerage relationships in real estate transactions act or rules and regulations adopted thereunder as such act governs the sale or lease of real estate that is one to four residential units, the commission may institute an action in the district court of the county in which the person resides or in the district court in the county in which such act or practice occurred for an injunction to enforce compliance with the act or rules and regulations. The commission shall not be required to give any bond or pay any filing fee for initiating such action. Upon a showing that the person has engaged in any act or practice in violation of the act or rules and regulations, the court may enjoin all such acts or practices and may make any orders necessary to conserve, protect and disburse any funds involved.

Sec. 9. K.S.A. 1995 Supp. 58-3065 is hereby amended to read as follows: 58-3065. (a) Willful violation of any provision of this act or the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units, is a misdemeanor punishable by imprisonment for not more than 12 months or a fine of not less than $100 or more than $1,000, or both, for the first offense and imprisonment for not more than 12 months or a fine of not less than $1,000 or more than $10,000, or both, for a second or subse- quent offense.

(b) Nothing in this act or the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units, shall be construed as requiring the commis- sion or the director to report minor violations of the acts for criminal prosecution whenever the commission or the director believes that the public interest will be adequately served by other administrative action.

Sec. 10. K.S.A. 1995 Supp. 58-3068 is hereby amended to read as follows: 58-3068. (a) Moneys in the real estate recovery revolving fund shall be used in the manner provided by this act to reimburse persons who suffer monetary damages by reason of any of the following acts com- mitted in connection with any transaction involving the sale of real estate in this state by any broker or salesperson who was licensed under the laws of this state at the time the act was committed or by any unlicensed employee of such broker or salesperson:

(1) Violation of any of the following provisions of this act:

(A) K.S.A. 58-3061 and amendments thereto; or

(B) subsection (a)(2), (3), (15), (20) or (21) (23), (28) or (29) or sub- section (b)(2) (d)(2) of K.S.A. 58-3062 and amendments thereto; or

(2) violation of any provision of the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units; or

(3) obtaining money or property by any act which would constitute any crime defined by K.S.A. 21-3701, 21-3704, 21-3705, 21-3706, 21- 3707, 21-3710, 21-3711 or 21-3712, and amendments thereto.

(b) Any person may seek recovery from the real estate recovery re- volving fund under the following conditions:

(1) Such person has received final judgment in a court of competent jurisdiction of this state in any action wherein the cause of action was based on any of the acts described in subsection (a);

(2) the claim is made within two years after the date that final judg- ment is entered;

(3) such person has caused to be issued a writ of execution upon such judgment, and the officer executing the same has made a return showing that no personal or real property of the judgment debtor liable to be levied upon in satisfaction of the judgment could be found, or that the amount realized on the sale of the judgment debtor's property pursuant to such execution was insufficient to satisfy the judgment;

(4) such person has made all reasonable searches and inquiries to ascertain whether the judgment debtor is possessed of real or personal property or other assets, subject to being sold or applied in satisfaction of the judgment, and by such search such person has discovered no such property or assets, or that such person has discovered such property and assets and that such person has taken all necessary action and proceedings for the application thereof to the judgment and that the amount thereby realized was insufficient to satisfy the judgment;

(5) any amounts recovered by such person from the judgment debtor, or from any other source, has been applied to the damages awarded by the court; and

(6) such person is not a person who is precluded by subsection (c) from making a claim for recovery.

(c) A person shall not be qualified to make a claim for recovery from the real estate recovery revolving fund, if:

(1) The person is the spouse of the judgment debtor or a personal representative of such spouse;

(2) the person acted as principal or agent in the real estate transaction which is the subject of the claim and is a licensed broker or salesperson or is a partnership, association, limited liability company or corporation whose partners, members, officers and employees are licensed as pro- vided by subsection (b) of K.S.A. 58-3042 and amendments thereto; or

(3) such person's claim is based upon a real estate transaction in which the licensed broker or salesperson was acting on the broker's or salesperson's own behalf with respect to property owned or controlled by such broker or salesperson.

Sec. 11. K.S.A. 1995 Supp. 74-4202 is hereby amended to read as follows: 74-4202. (a) Within 30 days after the appointment of the mem- bers to be regularly appointed within any year, the commission shall meet in the city of Topeka for the purpose of organizing by selecting from its membership a chairperson and such other officers as the commission may deem necessary and appropriate. A majority of the members of the com- mission shall constitute a quorum for the exercise of the powers or au- thority conferred upon it.

(b) The commission shall receive applications for, and issue licenses to, brokers and salespersons, as provided in this act and shall administer the provisions of this act and the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units. The commission may do all things necessary and convenient for carrying into effect the provisions of the acts and may adopt rules and regulations not inconsistent with the acts. For the purpose of the acts, the commission shall make all necessary investigations, and every licensee shall furnish to the commission such evidence as the li- censee may have as to any violation the acts or any rules and regulations adopted under the acts. The commission may enforce any order by an action in the district court of the county where the alleged violator resides or where the violation allegedly occurred.

(c) Each member of the commission shall be paid compensation, sub- sistence allowances, mileage and other expenses as provided in K.S.A. 75- 3223 and amendments thereto.

(d) The commission shall hold meetings and hearings in the city of Topeka or at such places as it shall determine at such times as it may designate and on request of two (2) or more of its members.

(e) The commission shall maintain an office in the city of Topeka, and all files, records and property of the commission shall at all times be and remain therein.

(f) The commission shall adopt a seal by which it shall attest its pro- ceedings. Copies of all records and papers required by law or the com- mission to be filed in the office of the commission, when duly certified by the director, assistant director or chairperson of the commission and attested by the seal of the commission, shall be received in evidence in all courts of the state of Kansas equally and with like effect as the originals.

Sec./007006/On and after July 1, 1997, K.S.A. 1995 Supp. 58-3050, as amended by section 6 of this bill, is hereby amended to read as follows: 58-3050. (a) The license of any licensee may be revoked, suspended or restricted or a licensee may be censured, if:

(1) The commission finds that the license has been obtained by false or fraudulent representation or that the licensee has committed a viola- tion of this act or rules and regulations adopted hereunder, or the bro- kerage relationships in real estate transactions act or rules and regulations adopted thereunder as such act governs the sale or lease of real estate that is one to four residential units, whether the licensee acted as an agent or a principal in the real estate transaction;

(2) the licensee has entered a plea of guilty or nolo contendere to, or has been convicted of: (A) Forgery, embezzlement, obtaining money un- der false pretenses, larceny, extortion, conspiracy to defraud or any other similar offense; (B) a crime involving moral turpitude; or (C) any felony charge; or

(3) the licensee has been finally adjudicated and found to be guilty of violation of the federal fair housing act (42 U.S.C. 3601 et seq.) or K.S.A. 44-1015 through 44-1029, and amendments thereto.

(b) In addition to or in lieu of any other administrative, civil or crim- inal remedy provided by law, the commission, in accordance with the Kansas administrative procedure act and upon a finding that a licensee has violated a provision of this act or rules and regulations adopted here- under, or the brokerage relationships in real estate transactions act or rules and regulations adopted thereunder as such act governs the sale or lease of real estate that is one to four residential units, may impose on such licensee a civil fine not exceeding $500 for each violation.

(c) If a broker or salesperson has been declared disabled by a court of competent jurisdiction, the commission shall suspend the broker's or salesperson's license for the period of disability.

(d) No complaint alleging violation of this act or rules and regulations adopted hereunder, or the brokerage relationships in real estate trans- actions act or rules and regulations adopted thereunder as such act gov- erns the sale or lease of real estate that is one to four residential units, shall be commenced more than three years from the date of the occur- rence which is the subject of the complaint.

(e) All administrative proceedings pursuant to this section shall be conducted in accordance with the Kansas administrative procedure act.

(f) Notwithstanding any provision of this act or the brokerage rela- tionships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units, to the contrary, the commission may use emergency adjudicative proceedings, as provided by K.S.A. 77-536 and amendments thereto, to summarily suspend the license of any licensee if the commission has reasonable cause to believe that the licensee's trust account is in unsound condition or that the li- censee is misappropriating funds belonging to other persons.

(g) If a licensee has entered a plea of guilty or nolo contendere to, or has been convicted of, any felony charge, the commission may use emer- gency adjudicative proceedings, as provided by K.S.A. 77-536 and amend- ments thereto to suspend, revoke or restrict the licensee's license.

(h) When the real estate license of an individual is revoked and that individual's name is included in the trade or business name of a real estate brokerage business, the commission may deny continued use of the trade or business name if, in the opinion of the commission, it would be con- fusing or misleading to the public.

If the revocation of the individual's license is appealed to district court and a stay of the commission's order is granted by the court, the com- mission may not deny continued use of the trade or business name until such time as the district court upholds the order of the commission.

Sec./007006/On and after July 1, 1997, K.S.A. 1995 Supp. 58-3062, as amended by section 7 of this bill, is hereby amended to read as follows: 58-3062. (a) No licensee, whether acting as an agent or a principal, shall:

(1) Intentionally use advertising that is misleading or inaccurate in any material particular or that in any way misrepresents any property, terms, values, policies or services of the business conducted, or uses the trade name, collective membership mark, service mark or logo of any organization owning such name, mark or logo without being authorized to do so.

(2) Fail to account for and remit any money which comes into the licensee's possession and which belongs to others.

(3) Misappropriate moneys required to be deposited in a trust ac- count pursuant to K.S.A. 58-3061 and amendments thereto, convert such moneys to the licensee's personal use or commingle the money or other property of the licensee's principals with the licensee's own money or property, except that nothing herein shall prohibit a broker from having funds in an amount not to exceed $100 in the broker's trust account to pay expenses for the use and maintenance of such account.

(4) Accept, give or charge any rebate or undisclosed commission.

(5) Pay a referral fee to a person who is properly licensed as a broker or salesperson in another jurisdiction or who holds a corporate real estate license in another jurisdiction if the licensee knows that the payment of the referral fee will result in the payment of a rebate by the out-of-state licensee.

(6) Represent or attempt to represent a broker without the broker's express knowledge and consent.

(7) Act in a dual capacity of agent and undisclosed principal in any transaction regarding the sale or lease of commercial or investment real estate property.

(8) Guarantee or authorize any person to guarantee future profits that may result from the resale of real property.

(9) Place a sign on any property offering it for sale or lease without the written consent of the owner or the owner's authorized agent.

(10) Offer real estate for sale or lease without the knowledge and consent of the owner or the owner's authorized agent or on terms other than those authorized by the owner or the owner's authorized agent.

(11) Induce any party to break any agency agreement or contract of sale or lease.

(12) Solicit a listing or negotiate a sale, exchange or lease of com- mercial or investment real estate property directly with an owner or lessor if the licensee knows that such owner or lessor has, with regard to the property, a written agency agreement granting an exclusive right to sell or lease to another broker.

(13) Solicit an agency agreement or negotiate a sale, exchange or lease of commercial or investment real estate property directly with a buyer or lessee if the licensee knows that such buyer or lessee has a written agency agreement granting exclusive representation to another broker.

(14) Except for a commercial or investment real estate property or any property owned by any agency of the federal government, fail to obtain a written agency agreement, including a fixed date of expiration, signed by the party to be represented and by the licensee or fail to furnish a copy of the agreement to the principal within a reasonable time. The licensee shall not assign, sell or otherwise transfer a written agency agree- ment to another broker without the express written consent of all parties to the original listing agreement.

(15) In any transaction regarding the sale of commercial or invest- ment real estate property If the licensee represents the seller, fail to disclose to a prospective buyer that: (A) The licensee is or will be acting as agent of the seller with the duty to represent the seller's interest; (B) the licensee will not be the agent of the prospective buyer; and (C) in- formation given to the licensee will be disclosed to the seller. The disclo- sure shall be made orally or in writing when the licensee agrees to assist the prospective buyer to locate and inspect property and shall be made in any contract for sale and in any lot reservation agreement.

(16) In any transaction regarding the sale of commercial or invest- ment real estate property If the licensee represents the buyer, fail to disclose to a prospective seller or seller's agent that: (A) The licensee is or will be acting as agent of the buyer with the duty to represent the buyer's interest; (B) the licensee will not be the agent of the seller; and (C) information given to the licensee will be disclosed to the buyer. The disclosure shall be made orally or in writing no later than the first showing of the property and shall be made in any contract for sale and in any lot reservation agreement.

(17) In any transaction regarding the sale of commercial or invest- ment real estate property If the licensee represents both the buyer and seller, the licensee shall immediately disclose in writing: (A) That the licensee is acting as agent for both buyer and seller; and (B) the com- pensation arrangement. The disclosure shall be signed by both the buyer and the seller. If the exclusive right to sell agreement and the buyer's agency agreement include the disclosure of the possibility of dual agency, the written disclosure, for each specific transaction, shall be signed by the buyer no later than the first showing of the property and by the seller no later than the presentation of the offer to purchase. In addition, the dis- closure of the agency relationship between all licensees involved and the principals shall be included in any contract for sale and in any lot reser- vation agreement.

(18) Offer or give prizes, gifts or gratuities which are contingent upon an agency agreement or the sale, purchase or lease of real estate.

(19) Enter into a listing agreement on commercial or investment real estate property in which the broker's commission is based upon the dif- ference between the gross sales price and the net proceeds to the owner.

(20) Fail to see that financial obligations and commitments between the parties to an agreement to sell, exchange or lease real estate are in writing, expressing the exact agreement of the parties or to provide, within a reasonable time, copies thereof to all parties involved.

(21) Procure a signature to a purchase contract which has no definite purchase price, method of payment, description of property or method of determining the closing date.

(22) Include in any agency agreement an authorization to sign or initial any document on behalf of the licensee's principal in a commercial or investment real estate property transaction or authorization to act as attorney-in-fact for the principal.

(23) Engage in fraud or make any substantial misrepresentation.

(24) Represent to any lender, guaranteeing agency or any other in- terested party, either verbally or through the preparation of false docu- ments, an amount in excess of the true and actual sale price of the real estate or terms differing from those actually agreed upon.

(25) Fail to make known to any purchaser or lessee any interest the licensee has in the real estate the licensee is selling or leasing or to make known to any seller or lessor any interest the licensee will have in the real estate the licensee is purchasing or leasing.

(26) Fail to inform both the buyer, at the time an offer is made, and the seller, at the time an offer is presented, that certain closing costs must be paid and the approximate amount of such costs.

(27) Fail without just cause to surrender any document or instrument to the rightful owner.

(28) Accept anything other than cash as earnest money unless that fact is communicated to the owner prior to the owner's acceptance of the offer to purchase, and such fact is shown in the purchase agreement.

(29) Fail to deposit any check or cash received as an earnest money deposit or as a deposit on the purchase of a lot within five business days after the purchase agreement or lot reservation agreement is signed by all parties, unless otherwise specifically provided by written agreement of all parties to the purchase agreement or lot reservation agreement, in which case the licensee shall deposit the check or cash received on the date provided by such written agreement.

(30) Fail in response to a request by the commission or the director to produce any document, book or record in the licensee's possession or under the licensee's control that concerns, directly or indirectly, any real estate transaction or the licensee's real estate business.

(31) In any transaction regarding the sale of commercial or invest- ment real estate property If the licensee represents the seller, fail to promptly submit any written offer to the licensee's principal when such offer is received prior to the closing of the sale or fail to promptly submit to the prospective buyer or buyer's agent any counteroffer made by the seller, including any back-up offers properly identified as such.

(32) In any transaction regarding the sale of commercial or invest- ment real estate property If the licensee represents the buyer, fail to promptly submit any written offer to the seller or seller's agent or fail to promptly submit to the licensee's principal any counteroffer made by the seller, including any back-up offers properly identified as such.

(33) Refuse to appear or testify under oath at any hearing held by the commission.

(34) Demonstrate incompetency to act as a broker, associate broker or salesperson.

(35) In any transaction regarding the sale or lease of commercial or investment real estate property Fail to disclose, or ascertain and disclose, to any person with whom the licensee is dealing, any material information which relates to the property with which the licensee is dealing and which such licensee knew or should have known.

(36) Knowingly receive or accept, directly or indirectly, any rebate, reduction or abatement of any charge, or any special favor or advantage or any monetary consideration or inducement, involving the issuance of a title insurance policy or contract concerning which the licensee is di- rectly or indirectly connected, from a title insurance company or title insurance agent, or any officer, employee, attorney, agent or solicitor thereof.

(37) Engage in the purchase of one-, two-, three- or four-family dwellings, including condominiums and cooperatives, or the acquisition of any right, title or interest therein, including any equity or redemption interests, if:

(A) (i) At the time of such purchase, the dwellings are subject to a right of redemption pursuant to foreclosure of a mortgage on such dwell- ings; (ii) the licensee fails to give written notice of the purchase, within 20 days thereafter, to the mortgage holder or judgment creditor who held such mortgage; and (iii) the licensee, unless otherwise required by law or court order, fails to apply any rent proceeds from the dwellings to the judgment lien arising from the foreclosure of such mortgage, as payments become due under the loan, regardless of whether the licensee is obli- gated to do so;

(B) (i) the dwellings are subject to a loan which is secured by a mort- gage and which is in default at the time of such purchase or in default within one year after such purchase; (ii) the licensee fails to give written notice of the purchase, within 20 days thereafter, to the mortgage holder; and (iii) the licensee, unless otherwise required by law or court order, fails to apply any rent proceeds from the dwellings to the mortgage as the payments come due, regardless of whether the licensee is obligated on the loan; or

(C) the licensee fails to notify, at the time of rental, any person rent- ing any such dwelling of the extent and nature of the licensee's interest in such dwelling and the probable time until possession will be taken by the mortgage holder or judgment creditor.

(38) Commit forgery or, unless authorized to do so by a duly executed power of attorney, sign or initial any contractual agreement on behalf of another person in a real estate transaction.

(b) In any transaction regarding the sale or lease of commercial or investment real estate property Failure to comply with any requirement of subsection (a)(14), (15), (16) or (17) or their corollary rules and regu- lations shall not by itself render any agreement void or voidable nor shall it constitute a defense to any action to enforce such agreement or any action for breach of such agreement.

(c) The commission may provide suggested forms of agency disclo- sure and agency agreements and, by rules and regulations, provide such other prohibitions, limitations and conditions relating thereto as the com- mission may prescribe for transactions regarding the sale or lease of com- mercial or investment real estate property.

(d) No salesperson or associate broker shall:

(1) Accept a commission or other valuable consideration from anyone other than the salesperson's or associate broker's employing broker or the broker with whom the salesperson or associate broker is associated.

(2) Fail to place, as soon after receipt as practicable, any deposit money or other funds entrusted to the salesperson or associate broker in the custody of the broker whom the salesperson or associate broker rep- resents.

(e) No broker shall:

(1) Pay a commission or compensation to any person for performing the services of an associate broker or salesperson unless such person is licensed under this act and employed by or associated with the broker, except that nothing herein shall prohibit the payment of a referral fee to a person who is properly licensed as a broker or salesperson in another jurisdiction relating to a transaction regarding the sale or lease of com- mercial or investment real estate property.

(2) Fail to deliver to the seller in every real estate transaction, at the time the transaction is closed, a complete, detailed closing statement showing all of the receipts and disbursements handled by the broker for the seller, or fail to deliver to the buyer a complete statement showing all money received in the transaction from such buyer and how and for what the same was disbursed, or fail to retain true copies of such state- ments in the broker's files, except that the furnishing of such statements to the seller and buyer by an escrow agent shall relieve the broker's re- sponsibility to the seller and the buyer.

(3) Fail to properly supervise the activities of an associated or em- ployed salesperson or associate broker.

(4) Lend the broker's license to a salesperson, or permit a salesperson to operate as a broker.

(5) Fail to provide to the principal a written report every 30 days, along with a final report, itemizing disbursements made by the broker from advance listing fees.

(f) If a purchase agreement provides that the earnest money be held by an escrow agent other than a real estate broker, unless otherwise spe- cifically provided by written agreement of all parties to the purchase agreement, no listing broker shall:

(1) Fail to deliver the purchase agreement and earnest money deposit to the escrow agent named in the purchase agreement within five business days after the purchase agreement is signed by all parties; or

(2) fail to obtain and keep in the transaction file a receipt from the escrow agent showing date of delivery of the purchase agreement and earnest money deposit.

(g) Nothing in this section shall be construed to grant any person a private right of action for damages or to eliminate any right of action pursuant to other statutes or common law.

Sec./007006/On and after July 1, 1997, K.S.A. 1995 Supp. 58-3064, as amended by section 8 of this bill, is hereby amended to read as follows: 58-3064. Whenever any person has engaged in any act or practice that constitutes a violation of this act or rules and regulations adopted here- under or the brokerage relationships in real estate transactions act or rules and regulations adopted thereunder as such act governs the sale or lease of real estate that is one to four residential units, the commission may institute an action in the district court of the county in which the person resides or in the district court in the county in which such act or practice occurred for an injunction to enforce compliance with the act or rules and regulations. The commission shall not be required to give any bond or pay any filing fee for initiating such action. Upon a showing that the person has engaged in any act or practice in violation of the act or rules and regulations, the court may enjoin all such acts or practices and may make any orders necessary to conserve, protect and disburse any funds involved.

Sec./007006/On and after July 1, 1997, K.S.A. 1995 Supp. 58-3065, as amended by section 9 of this bill, is hereby amended to read as follows: 58-3065. (a) Willful violation of any provision of this act or the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units, is a misdemeanor punishable by imprisonment for not more than 12 months or a fine of not less than $100 or more than $1,000, or both, for the first offense and imprisonment for not more than 12 months or a fine of not less than $1,000 or more than $10,000, or both, for a second or subsequent offense.

(b) Nothing in this act or the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units, shall be construed as requiring the commis- sion or the director to report minor violations of the acts act for criminal prosecution whenever the commission or the director believes that the public interest will be adequately served by other administrative action.

Sec./007006/On and after July 1, 1997, K.S.A. 1995 Supp. 58-3068, as amended by section 10 of this bill, is hereby amended to read as follows: 58-3068. (a) Moneys in the real estate recovery revolving fund shall be used in the manner provided by this act to reimburse persons who suffer monetary damages by reason of any of the following acts committed in connection with any transaction involving the sale of real estate in this state by any broker or salesperson who was licensed under the laws of this state at the time the act was committed or by any unlicensed em- ployee of such broker or salesperson:

(1) Violation of any of the following provisions of this act:

(A) K.S.A. 58-3061 and amendments thereto; or

(B) subsection (a)(2), (3), (23), (28) or (29) or subsection (d)(2) of K.S.A. 58-3062 and amendments thereto; or

(2) violation of any provision of the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units; or

(3) obtaining money or property by any act which would constitute any crime defined by K.S.A. 21-3701, 21-3704, 21-3705, 21-3706, 21- 3707, 21-3710, 21-3711 or 21-3712, and amendments thereto.

(b) Any person may seek recovery from the real estate recovery re- volving fund under the following conditions:

(1) Such person has received final judgment in a court of competent jurisdiction of this state in any action wherein the cause of action was based on any of the acts described in subsection (a);

(2) the claim is made within two years after the date that final judg- ment is entered;

(3) such person has caused to be issued a writ of execution upon such judgment, and the officer executing the same has made a return showing that no personal or real property of the judgment debtor liable to be levied upon in satisfaction of the judgment could be found, or that the amount realized on the sale of the judgment debtor's property pursuant to such execution was insufficient to satisfy the judgment;

(4) such person has made all reasonable searches and inquiries to ascertain whether the judgment debtor is possessed of real or personal property or other assets, subject to being sold or applied in satisfaction of the judgment, and by such search such person has discovered no such property or assets, or that such person has discovered such property and assets and that such person has taken all necessary action and proceedings for the application thereof to the judgment and that the amount thereby realized was insufficient to satisfy the judgment;

(5) any amounts recovered by such person from the judgment debtor, or from any other source, has been applied to the damages awarded by the court; and

(6) such person is not a person who is precluded by subsection (c) from making a claim for recovery.

(c) A person shall not be qualified to make a claim for recovery from the real estate recovery revolving fund, if:

(1) The person is the spouse of the judgment debtor or a personal representative of such spouse;

(2) the person acted as principal or agent in the real estate transaction which is the subject of the claim and is a licensed broker or salesperson or is a partnership, association, limited liability company or corporation whose partners, members, officers and employees are licensed as pro- vided by subsection (b) of K.S.A. 58-3042 and amendments thereto; or

(3) such person's claim is based upon a real estate transaction in which the licensed broker or salesperson was acting on the broker's or salesperson's own behalf with respect to property owned or controlled by such broker or salesperson.

Sec./007006/On and after July 1, 1997, K.S.A. 1995 Supp. 74-4202, as amended by section 11 of this bill, is hereby amended to read as follows: 74-4202. (a) Within 30 days after the appointment of the members to be regularly appointed within any year, the commission shall meet in the city of Topeka for the purpose of organizing by selecting from its membership a chairperson and such other officers as the commission may deem nec- essary and appropriate. A majority of the members of the commission shall constitute a quorum for the exercise of the powers or authority conferred upon it.

(b) The commission shall receive applications for, and issue licenses to, brokers and salespersons, as provided in this act and shall administer the provisions of this act and the brokerage relationships in real estate transactions act, as such act governs the sale or lease of real estate that is one to four residential units. The commission may do all things necessary and convenient for carrying into effect the provisions of the acts act and may adopt rules and regulations not inconsistent with the acts act. For the purpose of the acts act, the commission shall make all necessary in- vestigations, and every licensee shall furnish to the commission such ev- idence as the licensee may have as to any violation the acts of the act or any rules and regulations adopted under the acts act. The commission may enforce any order by an action in the district court of the county where the alleged violator resides or where the violation allegedly oc- curred.

(c) Each member of the commission shall be paid compensation, sub- sistence allowances, mileage and other expenses as provided in K.S.A. 75- 3223 and amendments thereto.

(d) The commission shall hold meetings and hearings in the city of Topeka or at such places as it shall determine at such times as it may designate and on request of two or more of its members.

(e) The commission shall maintain an office in the city of Topeka, and all files, records and property of the commission shall at all times be and remain therein.

(f) The commission shall adopt a seal by which it shall attest its pro- ceedings. Copies of all records and papers required by law or the com- mission to be filed in the office of the commission, when duly certified by the director, assistant director or chairperson of the commission and attested by the seal of the commission, shall be received in evidence in all courts of the state of Kansas equally and with like effect as the originals.

Sec./007006/K.S.A. 1995 Supp. 58-30,110 is hereby amended to read as follows: 58-30,110. (a) (1) The commission shall adopt a rule and regu- lation prescribing the language which shall be included in a form entitled ``Disclosure of alternative agency relationships''.

(2) At the discretion of the broker, the disclosure of alternative agency relationships form may be either a separate document or may be contained in the agency agreement with the client.

(3) Except as provided in subsection (a)(4), a licensee shall furnish a prospective buyer or seller with a copy of the disclosure of alternative agency relationships form at the first occurrence of either of the following events regarding real estate transactions:

(A) A face-to-face meeting with the prospective buyer or seller; or

(B) a written communication from the licensee.

The licensee shall obtain the signature of the prospective buyer or seller, and the date of the signature, on the disclosure of alternative agency relationships form. If the buyer or seller refuses to sign the form, the licensee shall note that fact the furnishing of a copy of the disclosure on a copy of the form and shall sign and date the form. The signed or noted copy of the form shall be retained by the broker for three years the contract.

(4) A licensee is not required to provide a copy of the form to a prospective buyer or seller in the following instances:

(A) The licensee is acting solely as a principal and not as an agent for another;

(B) the written communication from the licensee is a solicitation of business;

(C) the face-to-face meeting occurs at an open house and there is no substantive discussion regarding a transaction; or

(D) the face-to-face meeting is a mere solicitation of business and there is no substantive discussion regarding a transaction.

(b) (1) Except for instances when a licensee is providing information through an advertisement or other form of public notice of the licensee's representation of a client, a licensee representing a client in a proposed real estate transaction shall disclose the representation at the time of every contact with another licensee representing the other party. The disclosure may be made orally or in writing.

(2) Each time a licensee is contacted by another licensee who re- quests permission to show property to a prospective buyer, the licensee shall inquire whether or not the licensee represents the buyer.

(c) The disclosure of the agency relationship between all licensees involved and the seller and buyer shall be included in any contract for sale or lease and in any lot reservation agreement.

Sec. 19. K.S.A. 1995 Supp. 58-3035 is hereby amended to read as follows: 58-3035. As used in this act, unless the context otherwise re- quires:

(a) ``Advance listing fee'' means any fee charged for services related to promoting the sale or lease of real estate and paid in advance of the rendering of such services, including any fees charged for listing, adver- tising or offering for sale or lease any real estate, but excluding any fees paid solely for advertisement or for listing in a publication issued for the sole purpose of promoting the sale or lease of real estate wherein inquiries are directed to the owner of the real estate or to real estate brokers and not to unlicensed persons who publish the listing.

(b) ``Agency agreement'' means a written agreement between the principal and the licensee setting forth the terms and conditions of the relationship.

(c) ``Associate broker'' means an individual who has a broker's license and who is employed by another broker or is associated with another broker as an independent contractor and participates in any activity de- scribed in subsection (f).

(d) ``Branch broker'' means an individual who has a broker's license and who has been designated to supervise a branch office and the activ- ities of salespersons and associate brokers assigned to the branch office.

(e) ``Branch office'' means a place of business other than the principal place of business of a broker.

(f) ``Broker'' means an individual, other than a salesperson, who ad- vertises or represents that such individual engages in the business of buy- ing, selling, exchanging or leasing real estate or who, for compensation, engages in any of the following activities as an employee of, or on behalf of, the owner, purchaser, lessor or lessee of real estate:

(1) Sells, exchanges, purchases or leases real estate.

(2) Offers to sell, exchange, purchase or lease real estate.

(3) Negotiates or offers, attempts or agrees to negotiate the sale, exchange, purchase or leasing of real estate.

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

(5) Auctions or offers, attempts or agrees to auction real estate or assists an auctioneer by procuring bids at a real estate auction.

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

(7) Assists or directs in the procuring of prospects calculated to result in the sale, exchange or lease of real estate.

(8) Assists in or directs the negotiation of any transaction calculated or intended to result in the sale, exchange or lease of real estate.

(9) Engages in the business of charging an advance listing fee.

(10) Provides lists of real estate as being available for sale or lease, other than lists provided for the sole purpose of promoting the sale or lease of real estate wherein inquiries are directed to the owner of the real estate or to real estate brokers and not to unlicensed persons who publish the list.

(g) ``Commercial or investment real estate property'' means any real estate for which the present or intended use is other than: (1) one to four residential units; or (2) for agricultural purposes.

(h) ``Commission'' means the Kansas real estate commission.

(i) ``Lease'' means rent or lease for nonresidential use.

(j) ``Licensee'' means any person licensed under this act as a broker or salesperson.

(k) ``Office'' means a broker's place of business, where records may be maintained and licenses displayed, whether or not it is the broker's principal place of business.

(l) ``Person'' means any individual or any foreign or domestic corpo- ration, partnership or association.

(m) ``Real estate'' means any interest or estate in land, including any leasehold or condominium, whether corporeal, incorporeal, freehold or nonfreehold and whether the real estate is situated in this state or else- where, but does not include oil and gas leases, royalties and other mineral interests, and rights of way and easements acquired for the purpose of constructing roadways, pipelines, conduits, wires and facilities related to these types of improvement projects for private and public utilities, mu- nicipalities, federal and state governments, or any political subdivision. For purpose of this act, any rights of redemption are considered to be an interest in real estate.

(n) ``Salesperson'' means an individual, other than an associate bro- ker, who is employed by a broker or is associated with a broker as an independent contractor and participates in any activity described in sub- section (f).

(o) ``Supervising broker'' means an individual, other than a branch broker, who has a broker's license and who has been designated as the broker who is responsible for the supervision of the primary office of a broker and the activities of salespersons and associate brokers who are assigned to such office and all of whom are licensed pursuant to subsec- tion (b) of K.S.A. 58-3042 and amendments thereto. ``Supervising broker'' also means a broker who operates a sole proprietorship and with whom associate brokers or salespersons are affiliated as employees or independ- ent contractors.

Sec. 20. On and after July 1, 1997, K.S.A. 1995 Supp. 58-3035, as amended by section 19 of this bill, is hereby amended to read as follows: 58-3035. As used in this act, unless the context otherwise requires:

(a) ``Advance listing fee'' means any fee charged for services related to promoting the sale or lease of real estate and paid in advance of the rendering of such services, including any fees charged for listing, adver- tising or offering for sale or lease any real estate, but excluding any fees paid solely for advertisement or for listing in a publication issued for the sole purpose of promoting the sale or lease of real estate wherein inquiries are directed to the owner of the real estate or to real estate brokers and not to unlicensed persons who publish the listing.

(b) ``Agency agreement'' means a written agreement between the principal and the licensee setting forth the terms and conditions of the relationship.

(c) ``Associate broker'' means an individual who has a broker's license and who is employed by another broker or is associated with another broker as an independent contractor and participates in any activity de- scribed in subsection (f).

(d) ``Branch broker'' means an individual who has a broker's license and who has been designated to supervise a branch office and the activ- ities of salespersons and associate brokers assigned to the branch office.

(e) ``Branch office'' means a place of business other than the principal place of business of a broker.

(f) ``Broker'' means an individual, other than a salesperson, who ad- vertises or represents that such individual engages in the business of buy- ing, selling, exchanging or leasing real estate or who, for compensation, engages in any of the following activities as an employee of, or on behalf of, the owner, purchaser, lessor or lessee of real estate:

(1) Sells, exchanges, purchases or leases real estate.

(2) Offers to sell, exchange, purchase or lease real estate.

(3) Negotiates or offers, attempts or agrees to negotiate the sale, exchange, purchase or leasing of real estate.

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

(5) Auctions or offers, attempts or agrees to auction real estate or assists an auctioneer by procuring bids at a real estate auction.

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

(7) Assists or directs in the procuring of prospects calculated to result in the sale, exchange or lease of real estate.

(8) Assists in or directs the negotiation of any transaction calculated or intended to result in the sale, exchange or lease of real estate.

(9) Engages in the business of charging an advance listing fee.

(10) Provides lists of real estate as being available for sale or lease, other than lists provided for the sole purpose of promoting the sale or lease of real estate wherein inquiries are directed to the owner of the real estate or to real estate brokers and not to unlicensed persons who publish the list.

(g) ``Commercial or investment real estate property'' means any real estate for which the present or intended use is other than: (1) One to four residential units; or (2) for agricultural purposes.

(h) ``Commission'' means the Kansas real estate commission.

(i) ``Lease'' means rent or lease for nonresidential use.

(j) ``Licensee'' means any person licensed under this act as a broker or salesperson.

(k) ``Office'' means a broker's place of business, where records may be maintained and licenses displayed, whether or not it is the broker's principal place of business.

(l) ``Person'' means any individual or any foreign or domestic corpo- ration, partnership or association.

(m) ``Real estate'' means any interest or estate in land, including any leasehold or condominium, whether corporeal, incorporeal, freehold or nonfreehold and whether the real estate is situated in this state or else- where, but does not include oil and gas leases, royalties and other mineral interests, and rights of way and easements acquired for the purpose of constructing roadways, pipelines, conduits, wires and facilities related to these types of improvement projects for private and public utilities, mu- nicipalities, federal and state governments, or any political subdivision. For purpose of this act, any rights of redemption are considered to be an interest in real estate.

(n) ``Salesperson'' means an individual, other than an associate bro- ker, who is employed by a broker or is associated with a broker as an independent contractor and participates in any activity described in sub- section (f).

(o) ``Supervising broker'' means an individual, other than a branch broker, who has a broker's license and who has been designated as the broker who is responsible for the supervision of the primary office of a broker and the activities of salespersons and associate brokers who are assigned to such office and all of whom are licensed pursuant to subsec- tion (b) of K.S.A. 58-3042 and amendments thereto. ``Supervising broker'' also means a broker who operates a sole proprietorship and with whom associate brokers or salespersons are affiliated as employees or independ- ent contractors.

Sec. 21. On and after the effective date of this act, K.S.A. 1995 Supp. 58-3035, 58-3035a, 58-3036, 58-3037, 58-3039a, 58-3042, 58-3050, 58- 3062, 58-3064, 58-3065, 58-3068, 58-30,110 and 74-4202 are hereby re- pealed.

Sec. 22. On and after July 1, 1997, K.S.A. 1995 Supp. 58-3035, as amended by section 19 of this bill, 58-3050, as amended by section 6 of this bill, 58-3062, as amended by section 7 of this bill, 58-3064, as amended by section 8 of this bill, 58-3065, as amended by section 9 of this bill, 58-3068, as amended by section 10 of this bill, 58-30,101 through 58-30,112, and 74-4202, as amended by section 11 of this bill, are hereby repealed.

Sec. 23. This act shall take effect and be in force from and after its publication in the Kansas register.

Approved May 11, 1996.

Published in the Kansas Register: May 23, 1996.