Connecticut Real Estate Salesperson State Portion

Key Concepts

Commission purpose, powers and duties - The Real Estate Commission has eight members appointed by the Governor: three licensed real estate brokers at the time of appointment, two licensed real estate salespersons, and three public members (CGS Sec. 20-311a(b)). Textbook adds: at least one member from each congressional district, not more than a bare majority from the same political party, members must be electors, serve without pay but are reimbursed for expenses, and a majority is a quorum (Real Estate License Law, pp. 137–138). - The commission must meet at least once in each three-month period, and may meet more often at the call of its chairman (Sec. 20-311b(e)). - It may act as a board of arbitration for disputes over commissions arising between brokers or salespersons that are voluntarily submitted by the parties (Sec. 20-311f). - It is part of the Department of Consumer Protection, approves prelicensing and continuing education schools and courses, and submits an annual report to the Governor (pp. 137–138).

Activities requiring a license / unlicensed activity - The commission may impose a fine of not more than $5,000 per violation on any person engaging in the real estate business without a required license (Sec. 20-312(d)). - An unlicensed person cannot use the state courts to collect a commission (p. 138). Willful misrepresentation on a license application may bring a fine up to $500, imprisonment up to six months, or both (p. 140).

Exemptions from licensure (Sec. 20-329) - Sec. 20-329(1): owners/lessors dealing with their own property, and the owner's regular employees who live at the property and work as on-site residential superintendents, janitors or custodians, when acts are in the regular course of managing the property. - Sec. 20-329(3): receivers, trustees in bankruptcy, administrators, executors and other fiduciaries acting in that capacity. - Sec. 20-329(11): persons employed by a broker for clerical services — provided they do not negotiate agreement terms, list property (unless on behalf of a licensee), open or be a signatory on a broker's escrow or trust account, or sell, buy or lease for another for compensation. - **Leasing…

Key Concepts

Broker/salesperson relationship - A broker is liable to a third party for a salesperson affiliated as an independent contractor "to the same extent as if the salesperson had been employed by the broker" (CGS Sec. 20-312a). - A supervising licensee is responsible for associate brokers "to the same extent that they would be responsible if the associate brokers were real estate salespersons affiliated with them" (CGS Sec. 20-312c(b)), and an associate broker may not engage in the business without the supervising licensee's knowledge and consent (CGS Sec. 20-312c(a)). - Termination of an associate broker's affiliation must be reported to the department not later than fourteen calendar days after termination, or upon affiliation with another supervising licensee, whichever occurs first (CGS Sec. 20-312c(c)). - A salesperson or associate broker transferring affiliation must register the transfer and pay a $25 fee (CGS Sec. 20-319a(a)). - A written independent contractor agreement must provide the licensee is paid a commission based on gross sales or leases, without deduction for taxes, directly related to sales, leases or other output (CGS Sec. 20-312b(2)). - Non-publicly traded entities: brokers must own or control at least 51 percent (CGS Sec. 20-312(b)(5)); change of designated broker reported within 30 days (CGS Sec. 20-312(c)).

Handling of deposits and other monies - A separate escrow or trust account, distinct from the broker's own account, in a bank doing business in this state (CGS Sec. 20-324k(a)); deposits within three banking days of signing by all necessary parties (CGS Sec. 20-324k(c)); commission may audit whenever it deems necessary (CGS Sec. 20-324k(b)). - Disputed deposits: on motion, the court may order the broker to deposit certified funds with the court and shall dismiss claims based solely on the broker's stakeholder role (CGS Sec. 20-324k(d)). Willful violation: fine not more than $1,000 or imprisonment not more than six months, or both (CGS Sec. 20-324k(e)).

Key Concepts

Agency runs from the broker. In Connecticut, only a broker can enter into an agency relationship with a client; all salespersons working for the broker are automatically agents of the broker's clients and owe those clients fiduciary duties. A salesperson cannot enter into an agency relationship independently (Ch. 1, pp. 1–2). A person the broker works with but does not represent is a customer, owed honest and fair dealing, and must be given the Real Estate Agency Disclosure Notice Given to Unrepresented Persons (Ch. 1, p. 2).

Disclosures at the first personal meeting (Sec. 20-325d(b)). Not later than the first personal meeting, a licensee shall disclose in writing to a prospective party (1) the types of agency relationships available and (2) that confidential information should not be shared until a written representation agreement is in place (Sec. 20-325d(b)(1)(B)). These disclosures may be delivered electronically. In residential transactions, the licensee must also provide information on fair housing discrimination, including a description of federal and state fair housing laws, protected classes, where to obtain additional information, and available resources (Sec. 20-325d(b)(2)).

Client identity (Sec. 20-325d(a)). A licensee representing a seller, lessor, prospective purchaser or lessee shall, upon request, disclose in writing the identity of the client to any party to the transaction who is not represented by another real estate licensee.

Prospective party (Sec. 20-311(24)). Any person that communicates with a licensee in contemplation of potential representation in a real estate transaction.

Confidential information (Sec. 20-311(7)). Includes facts about assets, expenses, income, liabilities, motivations, and previous offers. Excluded: information that is part of a public record or file to which access is authorized under Sec. 1-210.

Key Concepts

Land records & recording (Ch. 9 – Title Records) - Connecticut has no county recording system: documents affecting title are recorded in the municipal land records of the town where the property is located, and each of the 169 towns maintains those records through the town or city clerk. - Title passes on delivery and acceptance of the deed, not recording; recording gives others constructive notice and fixes priority. - Deeds must be recorded within a reasonable time of delivery (no specific minimum or maximum is set). - Records are indexed by grantor/grantee; recently recorded but unindexed documents appear in the day book. - A change of name or status of an individual or entity owner must be recorded with the town clerk within 60 days. - Connecticut does not recognize the Torrens system. Marketable record title = unbroken chain for 40 years (CGS Sections 47-33b–47-331). A certificate of title is a brief opinion on marketability; an abstract is more detailed; title insurance covers defects not found in the search.

Real property taxes (Ch. 6) - Municipal ad valorem tax; the state levies no real property tax. Assessments must reflect market value; statutory assessment ratio is 70%. Revaluation every five years; physical inspection revaluation every ten years. - Grand List assessment date October 1 of the preceding year; tax year July 1–June 30; taxes generally payable July 1 and January 1 with a 30-day grace period; bills issued at least 30 days before the first installment. - Municipal tax liens take precedence over all other liens (possible exception: an earlier federal tax lien); liens must be recorded within two years of the due date, 15-year maximum; redemption six months after a tax sale (as short as 60 days if abandoned). Mechanic's liens: recorded within 90 days after work ceases, extinguish in one year (CGS Sections 49-33–49-38).