BILL ANALYSIS Ó
AB 685
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Date of Hearing: April 7, 2015
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Susan Bonilla, Chair
AB 685
(Irwin) - As Introduced February 25, 2015
SUBJECT: Real estate: licensees.
SUMMARY: Requires the California Bureau of Real Estate (CalBRE)
to deny a license to an applicant with an unpaid fine, and
authorizes the CalBRE to sanction a licensee for the surrender
of another license and revoke a license issued in error. The
bill also requires a licensee to report the filing of a criminal
complaint charging a felony against the licensee and makes other
technical changes.
EXISTING LAW
1)Provides for the licensure and regulation of real estate
brokers and real estate salespersons by the Bureau of Real
Estate headed by the Real Estate Commissioner (Commissioner).
(Business and Professions Code (BPC) § 10000 - 10580)
2)Authorizes the Commissioner to issue a citation to someone
engaged in activities requiring a real estate license if the
Commissioner has cause to believe the person does not have a
license. (BPC § 10080.9)
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3)Prohibits the Commissioner from renewing the license of a
person who has failed to comply with the terms of a citation
or pay an outstanding fine. (BPC § 10080.9)
4)Authorizes the Commissioner to suspend or revoke the license
of a real estate licensee, or deny the issuance of a license
to an applicant, if he or she has engaged in specific
activities or has had a license issued by another agency,
another state, or the federal government revoked or suspended
for engaging in those activities. (BPC § 10177)
5)Requires licensees to report the bringing of an indictment or
information charging a felony against the licensee. A willful
or knowing violation of this requirement is punishable by a
fine and imprisonment. (BPC § 10186.2, 10185)
THIS BILL
1)Prohibits the Commissioner from issuing a license to an
applicant that has not complied with the terms of a citation
or paid an outstanding fine.
2)Authorizes the Commissioner to suspend or revoke the license
of a licensee, or deny the issuance of a license to an
applicant, who surrendered a license issued by another agency,
another state, or the federal government.
3)Authorizes the Commissioner to suspend or revoke the license
of a licensee, or deny the issuance of a license to an
applicant, for failure to surrender a license that was issued
in error or by mistake.
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4)Requires a licensee to report the filing of a criminal
complaint charging a felony against the licensee to CalBRE.
5)Makes other nonsubstantive changes.
FISCAL EFFECT: Unknown. This bill is keyed fiscal by the
Legislative Counsel.
COMMENTS
1)Purpose. This bill is sponsored by the California Realtor's
Association. According to the Author, "AB 685 is a cleanup of
the Real Estate Law intended to provide greater clarity as
well as remove any redundancy. The measure will, for example,
(1) allow CalBRE to deny the issuance of a license due to
unpaid fine, (2) allow CalBRE to discipline a licensee for
actions taken against another state license if the behavior
that resulted in that action would have resulted in the
discipline of a real estate licensee, and (3) make it clear
that licensees must report any information regarding the
charging of a felony to CalBRE. These are changes that will
allow CalBRE to better oversee the licensure and discipline of
real estate licensees."
2)Background. Currently, there are several loopholes in CalBRE's
enforcement statute. First, CalBRE cannot deny an applicant a
license if the licensee has an outstanding fine, for instance
if fined for unlicensed activity.
Second, while CalBRE can suspend, revoke, or delay the renewal
of a license for a licensee, or deny the issuance of a license
to an applicant that has had a license suspended or revoked by
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another agency, it cannot do so if the license was voluntarily
surrendered.
Third, CalBRE is not expressly authorized to revoke a license
issued by mistake. This bill proposes to close the loopholes
by adding language authorizing CalBRE to perform the above
actions.
Reporting of criminal complaints. Current law requires a
licensee to report the "bringing of an indictment or
information charging a felony against a licensee." The failure
to report the filed pleadings is punishable by a fine and
imprisonment (BPC §10185). This bill would amend the language
to require a licensee to report the "bringing of an indictment
or information, or the filing of a criminal complaint,
charging a felony against a licensee." As worded, the bill
likely makes the failure to report the filing of a criminal
complaint charging a felony also punishable by fine or
imprisonment.
The sponsors state, "As it is unclear what was meant by
"information," the proposed amendment would clarify this
section by adding the filing of a criminal complaint charging
a felony to the list of disciplinary activities licensees must
report to the bureau." However, the new language is
ambiguous-it is unclear what the clause "or the filing of a
criminal complaint" is doing.
A complaint is the pleading used to bring charges in a felony
or misdemeanor criminal action (California Penal Code (CPC) §
949). Complaints are also the pleading used to prosecute a
misdemeanor and infraction (CPC § 740). They cannot be used to
prosecute felonies (CPC § 682).
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Information and indictments are the pleadings used to
prosecute felonies (CPC § 737). An information is the pleading
that is filed when felony charges are brought with a complaint
(CPC § 738-739). An indictment is a pleading that is presented
by a grand jury to the court, and charges a public offense-no
complaint is needed (CPC § 889). Therefore, while criminal
complaint, indictment, and information are often used
interchangeably, they are actually three distinct accusatory
pleadings under California criminal procedure (CPC § 959.1).
3)Related legislation. SB 146 (Galgiani) of 2015 revises the
definition of "responsible broker's identity" to mean a name
under which the responsible broker operates or conducts
business in general for the real estate firm as a whole and
that does not include a fictitious business name or a team
name owned or used solely by a salesperson or group of
salespersons, and would provide that a responsible broker's
identity may include divisions of the real estate firm
registered with the Bureau of Real Estate under the broker, as
specified. (STATUS: This bill is currently pending in the
Senate Business, Professions and Economic Development
Committee)
4)Previous legislation. SB 875 (Price), Chapter 380, Statutes of
2012, among other things, authorized CalBRE to use additional
procedures when denying a license and deleted an obsolete
provision dealing with the issuing of conditional licenses.
SB 706 (Price), Chapter 712, Statutes of 2011, made
enforcement enhancements to the Department of Real Estate
(DRE) and the Office of Real Estate Appraisers (OREA);
transferred OREA into DRE; required DRE to appoint a Real
Estate Advisory Commission; required licensing boards to post
information about licensees on the Internet, as specified; and
made updating and conforming changes.
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5)SUGGESTED AUTHOR'S AMENDMENT. The sponsors have noted that
they wish to include the requirement that licensees report
criminal complaints. Therefore, the author should amend the
bill to ensure the language is clear as to the requirement.
On page 7, lines 17 - 18, strike "an indictment or
information, or the filing of a criminal complaint," and
insert "a criminal complaint, information, or indictment."
REGISTERED SUPPORT / OPPOSITION:
Support
California Association of Realtors (sponsor)
Opposition
None on file.
Analysis Prepared by:Vincent Chee / B. & P. / (916) 319-3301
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