BILL NUMBER: AB 2039	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 21, 2014

INTRODUCED BY   Assembly Member Muratsuchi

                        FEBRUARY 20, 2014

   An act to amend Section 2079.23 of the Civil Code, relating to
real property.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2039, as amended, Muratsuchi. Real property sales: auction
companies: liability.
   Existing law requires listing and selling agents, as defined, to
provide sellers and buyers in a residential real property transaction
with a disclosure form, as prescribed, containing general
information on real estate agency relationships. Existing law
authorizes a contract between a principal and agent, in this context,
to be modified to change the agency relationship at any time before
the performance of the act which is the object of the agency with the
written consent of the parties.
   This bill would  require   prohibit a lender
or  an auction company that is retained to control aspects of a
residential real property transaction  from requiring  , as
a condition of receiving a lender's approval of the transaction,
 to defend the listing agent for any liability alleged to
result from the auction company's actions and to indemnify the agent
for liability resulting from the auction company's actions 
 a homeowner or listing agent to defend or indemnify the lender
or auction company from any liability alleged to result from the
actions of the lender or auction company and would declare a clause,
provision, covenant, or agreement in violation of this prohibition to
be against public policy, void, and unenforceable  .
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


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

  SECTION 1.  Section 2079.23 of the Civil Code is amended to read:
   2079.23.  (a) A contract between the principal and agent may be
modified or altered to change the agency relationship at any time
before the performance of the act which is the object of the agency
with the written consent of the parties to the agency relationship.
   (b)  If   A lender or  an auction
company  is  retained  by a lender  to
control aspects of a transaction of real property subject to this
part, including validating the sales price,  shall not require,
 as a condition of receiving  a   the 
lender's approval of the transaction,  the auction company
shall defend the listing agent for any liability alleged to result
from the auction company's actions and shall indemnify the agent for
liability the agent suffers as a result of the auction company's
actions   the homeowner or listing agent to defend or
indemnify the lender or auction company from any liability  
alleged to result from the actions of the lender or auction company.
Any clause, provision, covenant, or agreement purporting to impose
an obligation to defend or indemnify a lender or an auction company
in violation of this subdivision is against public policy, void, and
unenforceable .