BILL NUMBER: AB 1356	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JANUARY 22, 2008
	AMENDED IN ASSEMBLY  JANUARY 7, 2008

INTRODUCED BY   Assembly Member Houston

                        FEBRUARY 23, 2007

   An act to amend Section 1695.17 of the Civil Code, relating to
real property.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1356, as amended, Houston. Real property: equity purchasers.
   (1) Under existing law, an equity purchaser is liable for all
damages resulting from any statement made  ,  or act
committed by  ,  the representative of the equity purchaser,
as defined, in any manner connected with the equity purchaser's
acquisition of a residence in foreclosure, receipt of any
consideration or property from or on behalf of the equity seller, or
the performance of certain prohibited acts. Existing law requires the
representative of the equity purchaser to provide a statement in
writing to all parties to the contract, under penalty of perjury, and
written proof of licensure and bonding to the equity seller, as
specified.
   This bill would instead require the representative of an equity
purchaser to provide to the parties to a contract written proof of
licensure, as specified. The bill would also require the
representative to provide a statement under penalty of perjury and
written proof  to the parties to the contract  that he or
she has either (1) satisfied a certain minimum professional liability
coverage requirement  or (2) met a certain minimum bonding
requirement  and has an unrestricted real estate license in
good standing, as described by the regulations of the Real Estate
Commissioner, that is not restricted pursuant to the Real Estate
Recovery Program, as specified  , or (2) met a certain minimum
bonding requirement  .  Because 
    Because  the bill would expand the scope of the existing
crime of perjury, it would impose a state-mandated local program.
   (2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 1695.17 of the Civil Code is amended to read:
   1695.17.  (a)  A representative, as defined in subdivision (b) of
Section 1695.15, deemed to be the agent or employee, or both the
agent and the employee of the equity purchaser is required to provide
written proof to the parties to the contract that the representative
has a valid current California Real Estate Sales License and that
the representative meets the financial responsibility requirement
described in subdivision (c).
   (b) The failure to comply with subdivision (a) shall at the option
of the equity seller render the equity purchase contract void and
the equity purchaser shall be liable to the equity seller for all
damages proximately caused by the failure to comply.
   (c) For purposes of this section, a representative shall
demonstrate financial responsibility by providing written proof
 of   to the parties to the contract  and a
statement under penalty of perjury that he or she has  obtained
 either of the following:
   (1) Professional liability coverage in an amount equal to 
at least twice the value of the property that is subject to the
contract, or  one million dollars ($1,000,000)  ,
whichever is less  ; and an unrestricted real estate license
in good standing as described by the regulations of the Real Estate
Commissioner pursuant to Chapter 6 (commencing with Section 2705) of
Title 10 of the California Code of Regulations, that is not
restricted under the Real Estate Recovery Program pursuant to Chapter
6.5 (commencing with Section 10470) of Part 1 of Division 4 of the
Business and Professions Code. 
   (2) A surety bond in an amount equal to at least twice the value
of the property that is subject to the contract.  
   (2) A surety bond for each contract in an amount equal to at least
one-third of the median home price, as published by the California
Association of Realtors, for the metropolitan area within which the
property is located or, if data for the metropolitan area is not
available, for the county in which the property is located. The bond
shall be executed by a corporate surety admitted to do business in
this state. The bond shall be made in favor of the homeowner or, if
the homeowner cannot be found, the State of California for the
benefit of a homeowner for damages resulting from any statement made,
or act committed by, the representative in any manner connected with
the equity purchaser's acquisition of a residence in foreclosure,
receipt of any consideration or property from or on behalf of the
equity seller, or the performance of any act prohibited by this
chapter. 
  SEC. 2.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.