Law - Arizona Real Estate Lawbook

Arizona Real Estate Law Book 2008
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The online PDF version of the law book is updated to reflect changes   enacted by the 49th Legislature, 2nd Regular Session 2010  ______________________________________________________________________________ vii 32-2101. Definitions In this chapter, unless the context otherwise requires: 1. "Acting in concert" means evidence of collaborating to pursue a concerted plan. 2. "Advertising" means the attempt by publication, dissemination, exhibition, solicitation or circulation, oral or written, or for broadcast on radio or television to induce directly or indirectly any person to enter into any obligation or acquire any title or interest in lands subject to this chapter including the land sales contract to be used and any photographs, drawings or artist's presentations of physical conditions or facilities existing or to exist on the property. Advertising does not include: (a) Press releases or other communications delivered to newspapers, periodicals or other news media for general information or public relations purposes if no charge is made by the newspapers, periodicals or other news media for the publication or use of any part of these communications. (b) Communications to stockholders as follows: (i) Annual reports and interim financial reports. (ii) Proxy materials. (iii) Registration statements. (iv) Securities prospectuses. (v) Applications for listing of securities on stock exchanges. (vi) Prospectuses. (vii) Property reports. (viii) Offering statements. 3. "Affiliate" means a person who, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with the person specified. 4. "Associate broker" means a licensed broker employed by another broker. Unless otherwise specifically provided, an associate broker has the same license privileges as a salesperson. 5. "Barrier" means a natural or man-made geographical feature that prevents parcels of land from being practicably, reasonably and economically united or reunited and that was not caused or created by the owner of the parcels. 6. "Blanket encumbrance" means any mortgage, any deed of trust or any other encumbrance or lien securing or evidencing the payment of money and affecting more than one lot or parcel of subdivided land, or an agreement affecting more than one lot or parcel by which the subdivider holds the subdivision under an option, contract to sell or trust agreement. Blanket encumbrance does not include taxes and assessments levied by public authority. 7. "Board" means the state real estate advisory board. 8. "Broker", when used without modification, means a person who is licensed as a broker under this chapter or who is required to be licensed as a broker under this chapter. 9. "Business broker" means a real estate broker who acts as an intermediary or agent between sellers or buyers, or both, in the sale or purchase, or both, of businesses or business opportunities where a lease or sale of real property is either a direct or incidental part of the transaction. 10. "Camping site" means a space designed and promoted for the purpose of locating any trailer, tent, tent trailer, pickup camper or other similar device used for camping. 11. "Cemetery" or "cemetery property" means any one, or a combination of more than one, of the following in a place used, or intended to be used, and dedicated for cemetery purposes: (a) A burial park, for earth interments. (b) A mausoleum, for crypt or vault entombments. (c) A crematory, or a crematory and columbarium, for cinerary interments. (d) A cemetery plot, including interment rights, mausoleum crypts, niches and burial spaces. 12. "Cemetery broker" means a person other than a real estate broker or real estate salesperson who, for another, for compensation: (a) Sells, leases or exchanges cemetery property or interment services of or for another, or on the person's own account. (b) Offers for another or for the person's own account to buy, sell, lease or exchange cemetery property or interment services. (c) Negotiates the purchase and sale, lease or exchange of cemetery property or interment services. (d) Negotiates the purchase or sale, lease or exchange, or lists or solicits, or negotiates a loan on or leasing of cemetery property or interment services. 13. "Cemetery salesperson" means a natural person who acts on the person’s own behalf or through and on behalf of a professional limited liability company or a professional corporation engaged by or on behalf of a licensed cemetery or real estate broker, or through and on behalf of a corporation, partnership or limited liability company that is licensed as a cemetery or real estate broker, to perform any act or transaction included in the definition of cemetery broker. 14. "Commissioner" means the state real estate commissioner. 15. "Common promotional plan" means a plan, undertaken by a person or a group of persons acting in concert, to offer lots for sale or lease. If the land is offered for sale by a person or group of persons acting in concert, and the land is contiguous or is known, designated or advertised as a common unit or by a common name, the land is presumed, without regard to the number of lots covered by each individual offering, as being offered for sale or lease as part of a common promotional plan. Separate subdividers selling lots or parcels in separately platted subdivisions within a master planned community shall not be deemed to be offering their combined lots for sale or lease as part of a common promotional plan. 16. "Compensation" means any fee, commission, salary, money or other valuable consideration for services rendered or to be rendered as well as the promise of consideration whether contingent or not. 17. "Contiguous" means lots, parcels or fractional interests that share a common boundary or point. Lots, parcels or fractional interests are not contiguous if they are separated by either of the following: (a) A barrier. (b) A road, street or highway that has been established by this state or by any agency or political subdivision of this state, that has been designated by the federal government as an interstate highway or that has been regularly maintained by this state or by any agency or political subdivision of this state and has been used continuously by the public for at least the last five years. 18. "Control" or "controlled" means a person who, through ownership, voting rights, power of attorney, proxy, management rights, operational rights or other rights, has the right to make decisions binding on an entity, whether a corporation, a partnership or any other entity. 19. "Corporation licensee" means a lawfully organized corporation that is registered with the Arizona corporation commission and that has an officer licensed as the designated broker pursuant to section 32-2125. 20. "Department" means the state real estate department. 21. "Designated broker" means the natural person who is licensed as a broker under this chapter and who is either: (a) Designated to act on behalf of an employing real estate, cemetery or membership camping entity. (b) Doing business as a sole proprietor. 22. "Developer" means a person who offers real property in a development for sale, lease or use, either immediately or in the future, on the person's own behalf or on behalf of another person, under this chapter. Developer does not include a person whose involvement with a development is limited to the listing of property within the development for sale, lease or use. 23. "Development" means any division, proposed division or use of real property that the department has authority to regulate, including subdivided and unsubdivided lands, cemeteries, condominiums, timeshares, membership campgrounds and stock cooperatives. 24. "Employing broker" means a person who is licensed or is required to be licensed as a: (a) Broker entity pursuant to section 32-2125, subsection (b) Sole proprietorship if the sole proprietor is a broker licensed pursuant to this chapter. 25. "Fractional interest" means an undivided interest in improved or unimproved land, lots or parcels of any size created for the purpose of sale or lease and evidenced by any receipt, certificate, deed or other document conveying the interest. Undivided interests in land, lots or parcels created in the names of a husband and wife as community property, joint tenants or tenants in common, or in the names of other persons who, acting together as part of a single transaction, acquire the interests without a purpose to divide the interests for present or future sale or lease shall be deemed to constitute only one fractional interest. 26. "Improved lot or parcel" means a lot or parcel of a subdivision upon which lot or parcel there is a residential, commercial or industrial building or concerning which a contract has been entered into between a subdivider and a purchaser that obligates the subdivider directly, or indirectly through a building contractor, to complete construction of a residential, commercial or industrial building on the lot or parcel within two years from the date on which the contract of sale for the lot is entered into. 27. "Inactive license" means a license issued pursuant to article 2 of this chapter to a licensee who is on inactive status during the current license period and who is not engaged by or on behalf of a broker. 28. "Lease" or "leasing" includes any lease, whether it is the sole, the principal or any incidental part of a transaction. 29. "License" means the whole or part of any agency permit, certificate, approval, registration, public report, charter or similar form of permission required by this chapter. 30. "License period" means the two year period beginning with the date of original issue or renewal of a particular license and ending on the expiration date, if any. 31. "Licensee" means a person to whom a license for the current license period has been granted under any provision of this chapter, and, for purposes of section 32-2153, subsection A, shall include original license applicants. 32. "Limited liability company licensee" means a lawfully organized limited liability company that has a member or manager who is a natural person and who is licensed as the designated broker pursuant to section 32-2125. 33. "Lot reservation" means an expression of interest by a prospective purchaser in buying at some time in the future a subdivided or unsubdivided lot, unit or parcel in this state. In all cases, a subsequent affirmative action by the prospective purchaser must be taken to create a contractual obligation to purchase. 34. "Master planned community" means a development that consists of two or more separately platted subdivisions and that is either subject to a master declaration of covenants, conditions or restrictions, is subject to restrictive covenants sufficiently uniform in character to clearly indicate a general scheme for improvement or development of real property or is governed or administered by a master owner's association. 35. "Member" means a member of the real estate advisory board. 36. "Membership camping broker" means a person, other than a salesperson, who, for compensation: (a) Sells, purchases, lists, exchanges or leases membership camping contracts. (b) Offers to sell, purchase, exchange or lease membership camping contracts. (c) Negotiates or offers, attempts or agrees to negotiate the sale, purchase, exchange or lease of membership camping contracts. (d) Advertises or holds himself out as being engaged in the business of selling, buying, exchanging or leasing membership camping contracts or counseling or advising regarding membership camping contracts. (e) Assists or directs in the procuring of prospects calculated or intended to result in the sale, purchase, listing, exchange or lease of membership camping contracts. (f) Performs any of the foregoing acts as an employee or on behalf of a membership camping operator or membership contract owner. 37. "Membership camping contract" means an agreement offered or sold in this state evidencing a purchaser's right or license to use the camping or outdoor recreation facilities of a membership camping operator and includes a membership that provides for this use. 38. "Membership camping operator" means an enterprise, other than one that is tax exempt under section 501(c)(3) of the internal revenue code of 1986, as amended, that solicits membership paid for by a fee or periodic payments and has as one of its purposes camping or outdoor recreation including the use of camping sites primarily by members. Membership camping operator does not include camping or recreational trailer parks that are open to the general public and that contain camping sites rented for a per use fee or a mobile home park. 39. "Membership camping salesperson" means a natural person who acts on the person’s own behalf or through and on behalf of a professional limited liability company or a professional corporation engaged by or on behalf of a licensed membership camping or real estate broker, or by or on behalf of a corporation, partnership or limited liability company that is licensed as a membership camping or real estate broker, to perform any act or participate in any transaction in a manner included in the definition of membership camping broker. 40. "Partnership licensee" means a partnership with a managing general partner who is licensed as the designated broker pursuant to section 32-2125. 41. "Permanent access", as required under article 4 of this chapter, means permanent access from the subdivision to any federal, state or county highway. 42. "Perpetual or endowed-care cemetery" means a cemetery wherein lots or other burial spaces are sold or transferred under the representation that the cemetery will receive "perpetual" or "endowed" care as defined in this section free of further cost to the purchaser after payment of the original purchase price for the lot, burial space or interment right. 43. "Perpetual-care" or "endowed-care" means the maintenance and care of all places where interments have been made of the trees, shrubs, roads, streets and other improvements and embellishments contained within or forming a part of the cemetery. This shall not include the maintenance or repair of monuments, tombs, copings or other man-made ornaments as associated with individual burial spaces. 44. "Person" means any individual, corporation, partnership or company and any other form of multiple organization for carrying on business, foreign or domestic. 45. "Private cemetery" means a cemetery or place that is not licensed under article 6 of this chapter, where burials or interments of human remains are made, in which sales or transfers of interment rights or burial plots are not made to the public and in which not more than ten interments or burials occur annually. 46. "Promotion" or "promotional practice" means advertising and any other act, practice, device or scheme to induce directly or indirectly any person to enter into any obligation or acquire any title or interest in or use of real property subject to this chapter, including meetings with prospective purchasers, arrangements for prospective purchasers to visit real property, travel allowances and discount, exchange, refund and cancellation privileges. 47. "Real estate" includes leasehold-interests and any estates in land as defined in title 33, chapter 2, articles 1 and 2, regardless of whether located in this state. 48. "Real estate broker" means a person, other than a salesperson, who, for another and for compensation: (a) Sells, exchanges, purchases, rents or leases real estate, businesses and business opportunities or timeshare interests. (b) Offers to sell, exchange, purchase, rent or lease real estate, businesses and business opportunities or timeshare interests. (c) Negotiates or offers, attempts or agrees to negotiate the sale, exchange, purchase, rental or leasing of real estate, businesses and business opportunities or timeshare interests. (d) Lists or offers, attempts or agrees to list real estate, businesses and business opportunities or timeshare interests for sale, lease or exchange. (e) Auctions or offers, attempts or agrees to auction real estate, businesses and business opportunities or timeshare interests. (f) Buys, sells, offers to buy or sell or otherwise deals in options on real estate, businesses and business opportunities or timeshare interests or improvements to real estate, businesses and business opportunities or timeshare interests. (g) Collects or offers, attempts or agrees to collect rent for the use of real estate, businesses and business opportunities or timeshare interests. (h) Advertises or holds himself out as being engaged in the business of buying, selling, exchanging, renting or leasing real estate, businesses and business opportunities or timeshare interests or counseling or advising regarding real estate, businesses and business opportunities or timeshare interests. (i) Assists or directs in the procuring of prospects, calculated to result in the sale, exchange, leasing or rental of real estate, businesses and business opportunities or timeshare interests. (j) Assists or directs in the negotiation of any transaction calculated or intended to result in the sale, exchange, leasing or rental of real estate, businesses and business opportunities or timeshare interests. (k) Incident to the sale of real estate, businesses and business opportunities negotiates or offers, attempts or agrees to negotiate a loan secured or to be secured by any mortgage or other encumbrance upon or transfer of real estate, businesses and business opportunities or timeshare interests subject to section 32-2155, subsection C. This subdivision does not apply to mortgage brokers as defined in and subject to title 6, chapter 9, article 1. (l) Engages in the business of assisting or offering to assist another in filing an application for the purchase or lease of, or in locating or entering upon, lands owned by the state or federal government. (m) Claims, demands, charges, receives, collects or contracts for the collection of an advance fee in connection with any employment enumerated in this section, including employment undertaken to promote the sale or lease of real property by advance fee listing, by furnishing rental information to a prospective tenant for a fee paid by the prospective tenant, by advertisement or by any other offering to sell, lease, exchange or rent real property or selling kits connected therewith. This shall not include the activities of any communications media of general circulation or coverage not primarily engaged in the advertisement of real estate or any communications media activities that are specifically exempt from applicability of this article under section 32-2121. (n) Engages in any of the acts listed in subdivisions (a) through (m) of this paragraph for the sale or lease of other than real property if a real property sale or lease is a part of, contingent on or ancillary to the transaction. (o) Performs any of the acts listed in subdivisions (a) through (m) of this paragraph as an employee of, or in behalf of, the owner of real estate, or interest in the real estate, or improvements affixed on the real estate, for compensation. (p) Acts as a business broker. 49. "Real estate sales contract" means an agreement in which one party agrees to convey title to real estate to another party upon the satisfaction of specified conditions set forth in the contract. 50. "Real estate salesperson" means a natural person who acts on the person’s own behalf or through and on behalf of a professional limited liability company or a professional corporation engaged by or on behalf of a licensed real estate broker, or by or on behalf of a limited liability company, partnership or corporation that is licensed as a real estate broker, to perform any act or participate in any transaction in a manner included in the definition of real estate broker subject to section 32-2155. 51. "Sale" or "lease" includes every disposition, transfer, option or offer or attempt to dispose of or transfer real property, or an interest, use or estate in the real property, including the offering of the property as a prize or gift if a monetary charge or consideration for whatever purpose is required. 52. "Salesperson", when used without modification, means a natural person who acts on the person’s own behalf or through and on behalf of a professional limited liability company or a professional corporation licensed under this chapter or any person required to be licensed as a salesperson under this chapter. 53. "School" means a person or entity that offers a course of study towards completion of the education requirements leading to licensure or renewal of licensure under this chapter. 54. "Stock cooperative" means a corporation to which all of the following apply: (a) The corporation is formed or used to hold title to improved real property in fee simple or for a term of years. (b) All or substantially all of the shareholders of the corporation each receive a right of exclusive occupancy in a portion of the real property to which the corporation holds title. (c) The right of occupancy may only be transferred with the concurrent transfer of the shares of stock in the corporation held by the person having the right of occupancy. 55. "Subdivider" means any person who offers for sale or lease six or more lots, parcels or fractional interests in a subdivision or who causes land to be subdivided into a subdivision for the subdivider or for others, or who undertakes to develop a subdivision, but does not include a public agency or officer authorized by law to create subdivisions. 56. "Subdivision" or "subdivided lands": (a) Means improved or unimproved land or lands divided or proposed to be divided for the purpose of sale or lease, whether immediate or future, into six or more lots, parcels or fractional interests. (b) Includes a stock cooperative, lands divided or proposed to be divided as part of a common promotional plan and residential condominiums as defined in title 33, chapter 9. (c) Does not include: (i) Leasehold offerings of one year or less. (ii) The division or proposed division of land located in this state into lots or parcels each of which is or will be thirty-six acres or more in area including to the centerline of dedicated roads or easements, if any, contiguous to the lot or parcel. (iii) The leasing of agricultural lands or apartments, offices, stores, hotels, motels, pads or similar space within an apartment building, industrial building, rental recreational vehicle community, rental manufactured home community, rental mobile home park or commercial building. (iv) The subdivision into or development of parcels, plots or fractional portions within the boundaries of a cemetery that has been formed and approved pursuant to this chapter. 57. "Timeshare" or "timeshare property" means real property ownership or right of occupancy in real property pursuant to article 9 of this chapter. For the purposes of this chapter, a timeshare is not a security unless it meets the definition of a security under section 44-1801. 58. "Trustee" means: (a) A person designated under section 32-2194.27 to act as a trustee for an endowment-care cemetery fund. (b) A person holding bare legal title to real property under a subdivision trust. A trustee shall not be deemed to be a developer, subdivider, broker or salesperson within this chapter. 59. "Unimproved lot or parcel" means a lot or parcel of a subdivision that is not an improved lot or parcel. 60. "Unsubdivided lands" means land or lands divided or proposed to be divided for the purpose of sale or lease, whether immediate or future, into six or more lots, parcels or fractional interests and the lots or parcels are thirty-six acres or more each but less than one hundred sixty acres each, or that are offered, known or advertised under a common promotional plan for sale or lease, except that agricultural leases shall not be included in this definition. Recent legislative year: Laws 2010, Ch 20 §1 32-2108. Powers and duties of commissioner to make investigations and require information A. The commissioner on the commissioner’s own motion may, and upon a verified complaint in writing shall, investigate the actions of any natural person or entity engaged in the business or acting in the capacity of a broker, salesperson or developer and may at any time examine the books and records used in connection with the business insofar as the commissioner reasonably believes the books or records pertain to the transfer, sale, rental, lease, use or management of real property. In connection with an investigation, the commissioner or the commissioner's representative may take testimony and may examine and copy documents and other physical evidence that relate to the investigation. If necessary, the commissioner or the commissioner's representative may issue subpoenas to compel the testimony of witnesses and the production of documents and other evidence. If a person refuses to comply with a subpoena, the commissioner or the commissioner’s representative may apply to the superior court for an order to compel compliance. B. The commissioner shall establish a certification and enforcement unit that is charged with investigative duties relevant to the rules of the commissioner and the laws of this state, including applications for certification, investigations and enforcement and other duties as the commissioner prescribes. C. The commissioner may require any additional information and documents that are reasonably necessary to determine the good moral character of an applicant for or holder of a license or public report or renewal or amendment of a license or public report. For the purposes of this subsection, "applicant" or "holder" means a person and, if an entity, any officer, director, member, manager, partner, owner, trust beneficiary holding ten per cent or more beneficial interest, stockholder owning ten per cent or more stock and person exercising control of the entity. The information may include: 1. Prior criminal records. 2. A valid fingerprint clearance card issued pursuant to section 41-1758.03. 3. An affidavit setting out whether the applicant or holder has: (a) Been convicted of a felony or a misdemeanor. (b) Had any business or professional license denied, suspended or revoked or had any other disciplinary action taken or administrative order entered against the applicant or holder by any regulatory agency. (c) Had a public report denied or suspended. (d) Been permanently or temporarily enjoined by order, judgment or decree from engaging in or continuing any conduct or practice in connection with the sale or purchase of real estate, cemetery property, time-share intervals, membership camping campgrounds or contracts or securities or involving consumer fraud or the racketeering laws of this state. (e) Had any adverse decision or judgment entered against the applicant or holder arising out of the conduct of any business in or involving a transaction in real estate, cemetery property, time-share intervals or membership camping campgrounds or contracts involving fraud, dishonesty or moral turpitude. (f) Filed, or is subject to, a petition under any chapter of the federal bankruptcy act. (g) Participated in, operated or held an interest or exercised control in any entity to which subdivision (b), (c), (d), (e) or (f) applies. Recent legislative year: Laws 2010, Ch 20 §1 D. This section does not affect the department's authority to otherwise issue, deny, cancel, terminate, suspend or revoke a license. E. For the purposes of this section, "license applicant" means: 1. Each original real estate, cemetery and membership camping salesperson and broker applicant pursuant to article 2 of this chapter. 2. Each natural person, or for an entity applicant, any person exercising control of the entity, who applies for an original certificate of approval to operate a real estate school, or for a renewal certificate, any natural person or person exercising control who has not previously submitted a fingerprint card to the department. 3. Any natural person, or for an entity applicant, any person exercising control of the entity, on whom the department has evidence of a criminal record that has not been previously reviewed or evaluated by the department and who applies for a: (a) License renewal pursuant to section 32-2130. (b) Public report to: (i) Sell or lease subdivided lands pursuant to article 4 of this chapter. (ii) Sell or lease unsubdivided lands pursuant to article 7 of this chapter. (iii) Sell or lease time-share estates pursuant to article 9 of this chapter. (iv) Sell membership camping contracts pursuant to article 10 of this chapter. (c) Certificate of authority to sell cemetery lots pursuant to article 6 of this chapter. Recent legislative year: Laws 2010, Ch 20 §1 32-2108.01. License applicants; fingerprint clearance cards; definition A. Before receiving and holding a license issued pursuant to this chapter, each license applicant shall obtain a valid fingerprint clearance card issued pursuant to section 41-1758.03. B. The license applicant is responsible for providing the department with a valid fingerprint clearance card. C. The department shall not issue a license to an original license applicant before receiving a valid fingerprint clearance card pursuant to this section. However, the department shall suspend the license if the fingerprint clearance card is determined to be invalid and an applicant who was issued a license fails to submit a new valid fingerprint clearance card within ten days after being notified by the department. 32-2123. Application for license as broker or salesperson A. Every application for an original license shall be either submitted in writing and signed by the applicant or submitted electronically and contain an electronic or digital identifier that the commissioner deems appropriate. The application shall be accompanied by all applicable fees. B. An application for an original license as a broker or salesperson shall set forth: 1. The legal name and residence address of the applicant. 2. The applicant's employers and employment history for the immediately preceding ten years and any experience in real estate sales, appraisals, transfers or similar business in which the applicant previously engaged, if the commissioner determines that this information is needed to reasonably evaluate the good moral character of the applicant. 3. The name and place of business of the applicant's present employer, if any. 4. Whether the applicant has ever been convicted of a felony and, if so, the nature of the felony, where and when committed and the disposition of the conviction, or whether the applicant has been disbarred or suspended from the practice of law. 5. Whether the applicant has ever been refused a broker's or salesperson's license or any other occupational license in this or any other state, whether the applicant's license as a broker or salesperson has been revoked or suspended in this or any other state or whether the applicant has had any other occupational or professional license, certificate or registration revoked or suspended in this or any other state. 6. The name of any corporation, company or partnership that is or ever has been licensed by the department in which the applicant exercised any control. 7. If the applicant is a natural person, the applicant's social security number. If the applicant, due to bona fide religious convictions or other bona fide reasons that the applicant documents on the application to the satisfaction of the commissioner, does not have a social security number, the applicant may provide the applicant's federal tax identification number with the application. The state real estate department shall use the applicant's social security number or federal tax identification number to aid the department of economic security in locating noncustodial parents or the assets of noncustodial parents, and for no other purpose. C. An application for a license as a broker additionally shall set forth: 1. The name under which the business is to be conducted. 2. The situs and mailing address of the applicant's place of business, or if more than one, the situs and mailing addresses of each. D. An applicant for a broker's or salesperson's license shall provide information that the commissioner determines is reasonably necessary to establish the character of the applicant. The information may include but shall not be limited to: 1. Prior criminal records. 2. A valid fingerprint clearance card issued pursuant to section 41-1758.03. 3. An affidavit setting out whether the applicant has participated in, operated or held an interest in any land development company which has filed, or is subject to, a petition under any chapter of the federal bankruptcy act. E. Each person licensed pursuant to this article, whether the license is active or inactive, shall have available for the licensee's use a current copy of the department's statutes, rules and annotations pertaining to real estate laws. Failure to comply with this requirement shall not be deemed grounds for a civil penalty or for denial, suspension or revocation of a license. Recent legislative year: Laws 2010, Ch 20 §2 32-2129. Advance payment of license fees A. All license fees shall be paid in advance and shall be the same regardless of the time of the year the license is issued. B. If the license fees or other fees that relate to licensure are paid with a check that is not honored by the financial institution on which it is written, the department may deny or cancel the license. C. An original license shall be for a period of two years up to and including the last day of the month in which the license was granted. A renewal license shall be effective as of the date of issuance, but no earlier than the first day after the expiration of the previous license. Regardless of the date of issuance, the renewed license is for a two year period beginning on the first day after the expiration of the previous license. D. License applicants shall pay fees as specified in this chapter. Recent legislative year: Laws 2010, Ch 20 §2 32-2130. Renewal requirements of licenses; education A. A license may be renewed in a timely manner by filing an application for renewal in the manner prescribed by the commissioner, by paying the renewal fee specified in this chapter and by presenting evidence of attendance at a school certified by the commissioner during the preceding license period of twenty-four credit hours, or a lesser number of credit hours prescribed by the commissioner, of real estate oriented continuing education courses prescribed and approved by the commissioner. The total number of credit hours shall be accrued at a rate of twenty-four credit hours during each twenty-four month period of licensure. The department shall maintain a current list of approved courses. The commissioner may waive all or a portion of the continuing education requirement for good cause shown. The commissioner shall determine by rule the content of the twenty-four renewal credit hours. The twenty-four renewal credit hours may include the commissioner's current topics, including short sales. (L10, Ch. 156, sec. 1 & Ch. 166, sec. 6. Eff. 1/1/11) For the purposes of this subsection, "short sales" means real estate transactions in which the sales price is insufficient to pay the loan encumbering the property in addition to the costs of sale and the seller is unable to pay the difference. B. If an applicant is renewing a license within one year after it expired, the applicant may apply continuing education hours completed after the expiration toward the continuing education required for renewal. C. Each renewal application shall contain, as applicable, the same information required in an original application pursuant to section 32-2123. D. Cemetery brokers and salespersons and membership camping brokers and salespersons are exempt from the educational requirements of this section. E. Nothing in this section requires a licensee to attend department produced or sponsored courses if approved courses are otherwise available. F. Between the expiration date of the license and the date of renewal of the license, the rights of the licensee under the license expire. While the license is expired it is unlawful for a person to act or attempt or offer to act in a manner included in the definition of a real estate, cemetery or membership camping broker or salesperson. If the license of an employing broker expires under this subsection, the licenses of persons who are employed by the employing broker shall be severed from the employing broker on the license expiration date of the employing broker. These persons may be rehired on renewal of the employing broker's license. The department shall terminate a license that has been expired for more than one year. G. Except as provided in section 32-4301, no more than one year after the license expiration date, the department shall renew a license without requiring the applicant to submit to an examination if the applicant held a license that was not canceled or suspended at the time of expiration. Except as provided in section 32-4301, the license period for a license renewed pursuant to this subsection commences the day after the expiration date of the expired license. Except as provided in section 32-2131, subsection A, paragraph 4 or 6, an applicant whose license has been terminated or revoked does not qualify for license renewal. H. Any employee or immediate family member of any employee of this state who, pursuant to section 32-2110 or any other law, rule or requirement, is prohibited from using a license issued under this chapter shall have, on the request of the employee or family member, the license placed on inactive status, shall have the right to renew the license and shall not be required to pay further fees until the employee or family member is again eligible to use the license. Renewal fees for the license shall not be required for only as long as the employee or family member is prohibited from using the license. I. The department shall not renew the license of a person who has been convicted of a felony offense and who is currently incarcerated for the conviction, paroled or under community supervision and under the supervision of a parole or community supervision officer or who is on probation as a result of the conviction. This subsection does not limit the commissioner's authority and discretion to deny the renewal for any other reason pursuant to this chapter. Recent legislative year: Laws 2010, Ch 20 §2 32-2137. Cancellation of active license On request of an active licensee, the department may cancel that person's license if both of the following are true: 1. The licensee is not presently under investigation by the department. 2. The department has not commenced any disciplinary proceeding against the licensee. Recent legislative year: Laws 2010, Ch 20 §2 license occurs not less than ten days prior to a hearing under this section. After the acceptance of a voluntary surrender of a license under this section the department shall not thereafter issue a license under this chapter to the licensee. B. If the commissioner finds that the public health, safety or welfare imperatively requires emergency action, and incorporates a finding to that effect in the commissioner's order, summary suspension of a license or sales may be ordered. Grounds for issuance of an order of summary suspension include the violation of any of the provisions of section 32-2153 and the termination of a license pursuant to section 32-2188, subsection I. A licensee, owner, operator, agent or developer may request a hearing pursuant to title 41, chapter 6, article 10. A summary suspension shall be deemed to be final if a request for a hearing is not received within thirty days as provided by section 41-1092.03. C. The department may issue a summary suspension when the department receives notice that a person licensed pursuant to this chapter has been convicted of a felony offense and is currently incarcerated for the conviction, paroled or under the supervision of a parole or community supervision officer or is on probation as a result of the conviction. This subsection does not limit the commissioner's authority to seek revocation of a license or other disciplinary action pursuant to this chapter. Recent legislative year: Laws 2010, Ch 20 §3 32-2157. Written notice of charges; summary suspension; hearing; voluntary surrender of license A. Except as provided in subsections B and C of this section, before suspending, revoking or denying the renewal or the right of renewal of any license, or issuing any order prohibiting the sale or lease of property or the sale of cemetery lots or membership camping contracts as provided by this chapter, the commissioner shall present the licensee, owner, operator, agent or developer with written notice of the charges filed against the person, or reasons for prohibiting the sale or lease, and shall afford the person an opportunity for a hearing pursuant to title 41, chapter 6, article 10. Within twenty days after service of a notice of hearing, the respondent shall appear by filing a written answer to the complaint. A licensee against whom the department has commenced a disciplinary proceeding under this chapter may voluntarily surrender to the department the license if the surrender of the 32-2163. Unlawful acts; out-of-state broker; cooperation agreement A. It is unlawful for any licensed broker in this state to employ or compensate, directly or indirectly, any person for performing any of the acts within the scope of this chapter if the person is not also a licensed broker in this state, or a salesperson licensed under the broker employing or compensating him, except that a licensed broker in this state may pay compensation to and receive compensation from a broker lawfully operating in another state. B. Notwithstanding that pursuant to subsection A of this section a licensed broker in this state may pay to and receive compensation from an out-of-state broker, this authority shall not be construed to permit an out-of-state broker to conduct activity in this state that would otherwise require a broker's license issued by the department. C. A licensed broker in this state may cooperate with an out-of-state broker who would otherwise require licensure in this state if: 1. The licensed broker and the out-of-state broker enter into a written cooperation agreement before the out-of-state broker conducts any activity otherwise requiring a broker's license pursuant to this chapter. The cooperation agreement shall include the following: (a) A list of the real estate activities to be conducted by the out-of-state broker. (b) A statement that the out-of-state broker agrees to fully comply with the laws of this state and submit to the regulatory jurisdiction of the department for activities subject to real estate broker licensure pursuant to this chapter. (c) A statement that the licensed broker in this state understands and accepts responsibility for the acts of the out-of-state broker. 2. All negotiations in this state or with people who own property in this state are conducted through the licensed broker in this state. 3. The licensed broker in this state assumes all responsibility for the acts of the out-of-state broker. 4. All principal funds handled by either the licensed broker in this state or the out-of-state broker are subject to the deposit and handling requirements of section 32-2151. D. The offering of real estate brokerage services specified by section 32-2101, paragraph 48 for compensation or any other thing of value pertaining to real property located in this state through an internet web site constitutes activity that requires a broker's license issued by the department. E. This section does not allow an out-of-state broker who is not licensed in this state to list, market or advertise in this state real property located in this state for sale, lease or exchange. F. Signs shall not be placed on real property in this state by an out-of-state broker. An out-of-state broker shall not use a cooperation agreement as authority to sell, lease, rent, exchange or attempt to sell, lease, rent or exchange real property to a resident of this state. Recent legislative year: Laws 2010, Ch 20 §3 32-2176. Payment of finder fees to apartment tenants; limits; prohibited activities; civil penalty; definitions A. Notwithstanding sections 32-2155, 32-2163 and 32-2165 or any other provision of this chapter, a property management firm or a property owner may: 1. Pay a finder fee to an unlicensed person who is a tenant in an apartment complex managed by the firm or owned by the owner. 2. Authorize a residential leasing agent or manager to deliver a finder fee to an unlicensed person who is a tenant in an apartment complex managed by the residential leasing agent or manager. A residential leasing agent or manager may not receive a finder fee. This prohibition does not affect the ability of a residential leasing agent or manager to receive a bonus pursuant to section 32-2121, subsection A, paragraph 6. B. A finder fee paid pursuant to this section shall not exceed a two hundred dollar credit toward or reduction in the tenant's monthly rent. A tenant may receive multiple finder fees pursuant to this section up to five times in any twelve month period. C. A tenant shall limit the tenant's activities pursuant to this section to referring prospective lessees to the owner or the owner's agent and shall not do any of the following: 1. Show a residential dwelling unit to a prospective lessee. 2. Discuss terms or conditions of leasing a dwelling unit with a prospective lessee. 3. Participate in the negotiation of the leasing of a dwelling unit. D. Nothing in this section permits an unlicensed person to advertise or otherwise promote the person's services in procuring or assisting to procure prospective lessors or tenants of apartment units. E. For a licensee who pays a finder fee in violation of this section, for each violation the department may suspend or revoke the licensee's license or impose a civil penalty pursuant to section 32-2153. F. For the purposes of this section: 1. "Finder fee" means a fee paid to a person for introducing or arranging an introduction between the parties to a transaction involving the rental of an apartment unit. 2. "Property owner" means a person who is exempt from the licensing requirements of this chapter pursuant to section 32-2121, subsection A, paragraph 1. 3. "Residential leasing agent or manager" has the same meaning prescribed in section 32-2121, subsection A, paragraph 6. Recent legislative year: Laws 2010, Ch 20 §3.1 32-2181.02. Exempt sales and leases A. The following are exempt under this article: 1. The sale or lease in bulk of six or more lots, parcels or fractional interests to one buyer in one transaction. 2. The sale or lease of lots or parcels of one hundred sixty acres or more. B. The following are exempt from section 32-2181, subsection A and section 32-2183, subsection A: 1. The sale or lease of parcels, lots, units or spaces that are zoned and restricted to commercial or industrial uses. 2. The sale or lease of lots or parcels located in a single platted subdivision by a subdivider if: (a) A public report has been issued within the past two years pursuant to this article on the subdivision lots or parcels. (b) The subdivision meets all current requirements otherwise required of a subdivision under this article. (c) The method of sale or lease of lots or parcels meets all current requirements under this article. (d) The lots or parcels are included on a recorded subdivision plat that is approved by a municipal or county government. (e) All roads within the subdivision, all utilities to the lots or parcels being offered for sale or lease and all other required improvements within the subdivision, other than a residence to be built, are complete, paid for and free of any blanket encumbrances. (f) The roads, utilities or other improvements are not complete, but the completion of all improvements is assured pursuant to section 32-2183, subsection F. (g) Except for matters relating to ownership, there have been no material changes to the information set forth in the most recent public report issued for the subdivision lots that would require an amendment to the public report. (h) No owner of a ten per cent or greater interest, subdivider, director, partner, agent, officer or developer of the subdivision has: (i) Been convicted of a felony or any crime involving theft, dishonesty, violence against another person, fraud or real estate, regardless of whether the convictions were subsequently expunged. (ii) Had a civil judgment entered against the person in a case involving allegations of misrepresentation, fraud, breach of fiduciary duty, misappropriation, dishonesty or, if the subject matter involved real property, securities or investments. (iii) Had a business or professional license, including a real estate license, denied, suspended or revoked or voluntarily surrendered a business or professional license during the course of an investigative or disciplinary proceeding or other disciplinary action taken in this state or any other state. (i) The sale of the subdivided lands violates no laws or ordinances of any governmental authority. (j) Before the buyer's or lessee's execution of a purchase contract or lease, the subdivider has provided the buyer or lessee with a copy of the most recent public report on the lot and has taken a receipt from the buyer for the copy. (k) The subdivider has provided to the buyer or lessee, along with the public report, a signed statement that the subdivider has reviewed and is in compliance with the terms of the exemption provided in this paragraph. (l) Before sale or lease, the subdivider has notified the commissioner, on a form provided by the department, of the subdivider's intent to sell or lease lots or parcels pursuant to this paragraph. The notice shall include: (i) The name, address and telephone number of the subdivider. (ii) The name, address and telephone number of any real estate broker retained by the subdivider to make sales or leases of the lots. (iii) The name and location of the subdivision. (iv) The most recent subdivision public report reference number on the lots. (v) The completion status of subdivision improvements. 3. The conveyance to a person who previously conveyed the lot to a home builder for the purpose of constructing a dwelling for the person. 4. The sale or lease by a person of individual lots or parcels that were separately acquired by the person from different persons and that were not acquired for the purpose of development if: (a) The lots or parcels are not located in a platted subdivision. (b) Each lot or parcel bears the same legal description that it bore when the lot or parcel was acquired by the person. (c) The seller or lessor is in compliance with all other applicable state and local government requirements. 5. The sale of an improved lot in a subdivision that is located outside of this state if: (a) The subdivision is located within the United States and the sale is exempt from the interstate land sales full disclosure act (P.L. 90-448; 82 Stat. 590; 15 United States Code sections 1701 through 1720). (b) The subdivider is required by the state where the subdivision is located to deliver a public report or equivalent disclosure document to prospective purchasers and the subdivider delivers the report or equivalent disclosure document. 6. The sale of an improved lot in a subdivision located in this state where five or more sales were previously made by the seller if: (a) The sale is the seller's first or second sale in the subdivision within the previous twelve month period. (b) The subdivision is located within the corporate limits of a town or city. (c) Electricity and telephone service are complete and available to the improved lot. (d) Water and sewage service is complete and available to the improved lot. (e) Streets and roads located outside of the subdivision provide permanent access to the subdivision and are complete and maintained by the county, town or city, or by a legally created and operational property owners' association. (f) Streets within the subdivision are dedicated, provide permanent access to the lot, are complete to town or city standards and are maintained by the town or city or, in the case of private streets, a legally created and operational property owners' association accepts the responsibility of perpetual maintenance. (g) All subdivision common area improvements, including landscaping, recreational facilities and other jointly used and maintained improvements, are complete and maintained by a legally created and operational property owners' association. (h) The purchaser's down payment, earnest money, deposit or other advanced money is placed and held in a neutral escrow depository in this state until escrow closes and the deed is delivered to the purchaser. (i) Within the previous twelve months the seller has not had an ownership interest in more than two lots in the subdivision, including an interest by option, an agreement for sale, a beneficial interest under a trust or a purchase contract. C. Nothing in this section shall be construed to increase, decrease or otherwise affect any rights or powers granted the commissioner under this chapter. D. This section does not apply to lands on which the commissioner has issued orders pursuant to sections 32-2154 and 32-2157 and section 32-2183, subsection M unless the commissioner has issued a public report on those lands subsequent to the date of the orders. E. Nothing in this section shall be construed to increase, to decrease or to otherwise affect any rights or powers granted to political subdivisions of this state with respect to their jurisdictions. Recent legislative year: Laws 2010, Ch 20 §4 32-2197.21. Payment of finder fees; limits; prohibited activities; records; definition A. Notwithstanding sections 32-2155, 32-2163 and 32-2165 or any other provision of this chapter, a developer or managing entity may pay a finder fee to a person who is not licensed pursuant to this chapter and who owns a timeshare interest in the developer’s timeshare plan or in the timeshare plan managed by that managing entity. B. A finder fee paid pursuant to this section shall not exceed one thousand dollars in credit or nonmonetary compensation during any twelve month period. C. This section does not permit a person who is not licensed pursuant to this chapter to advertise or promote the person’s services in procuring or assisting to procure prospective timeshare interest purchasers. D. The developer or managing entity shall keep records of all finder fees paid pursuant to this section for three years after the payment is made. E. For purposes of this section, "finder fee" means credit or nonmonetary compensation paid to a person who is not licensed pursuant to this chapter, who owns a timeshare interest and who provides the name and address of a prospective purchaser to the developer or managing entity of the timeshare plan in which the owner previously purchased a timeshare interest. Recent legislative year: Laws 2010, Ch 20 §3 83 REAL ESTATE 32-2197.22 B. A person is exempt from this article if any of the following applies: 1. The person is either an owner of a timeshare interest or a real estate broker who represents an owner of a timeshare interest if the owner acquired the timeshare interest for the owner’s own use and occupancy and offers it for resale. 2. The person is a managing entity or an association or a designated agent of a managing entity or association if all of the following apply: (a) The entity or association is not a developer of a timeshare plan. (b) The person solely acts as an association or is under a contract with an association to offer or sell a timeshare interest transferred to the association through foreclosure, deed or gratuitous transfer if done in the regular course of, or incident to, the management of the association for the management’s account in the timeshare plan. (c) The managing entity or the association provides to each purchaser who is not an existing owner in the timeshare plan, the following disclosures before execution of the purchase agreement: (i) The name and address of the timeshare plan and of the managing entity of the timeshare plan. (ii) The following statement in conspicuous type located before the disclosure required by item (vi) of this subdivision: The current year’s assessment for common expenses allocable to the timeshare interest you are purchasing is $ . This assessment, which may be increased periodically by the managing entity of the timeshare plan, is payable in full each year on or before . This assessment (includes/ does not include) yearly ad valorem real estate taxes that (are/are not) billed and collected separately. (iii) If ad valorem real property taxes are not included in the current year’s assessment for common expenses, the following statement must be in conspicuous type located immediately after the disclosure required by item (ii) of this subdivision: The most recent annual assessment for ad valorem real estate taxes for the timeshare interest you are purchasing is $ . (iv) If there are any delinquent assessments for common expenses or ad valorem taxes outstanding with respect to the timeshare interest in question, the following statement must be in conspicuous type located immediately after the disclosure required by items (ii) and (iii) of this subdivision: A delinquency in the amount of $ for unpaid common expenses or ad valorem taxes currently exists with respect to the timeshare interest you are purchasing, together with a per diem charge of $ for interest and late charges. (v) The following statement in conspicuous type located immediately after the disclosure required by items (ii), (iii) and (iv) of this subdivision: Each owner is personally liable for the payment of the owner’s assessments for common expenses, and failure to timely pay these assessments may result in restriction or loss of your use and ownership rights. There are many important documents relating to the timeshare plan that you should review before purchasing a timeshare interest, copies of which are available from the association or the managing entity on request, including the declaration of condominium or covenants and restrictions, the association articles and bylaws, the current year’s operating and reserve budgets and any rules affecting the use of timeshare plan accommodations and facilities. (vi) The year in which the purchaser will first be entitled to occupancy or use of a timeshare period associated with the timeshare interest that is the subject of the resale purchase agreement. 3. The person offers a timeshare plan in a national publication or by electronic media, as determined by the commissioner or as provided by rule, that is not directed to or targeted to any individual located in the state. For purposes of this paragraph, ‘‘national publication’’ or ‘‘electronic media’’ means publications or media circulated, distributed and broadcast on a regional or national basis to residents of the United States and foreign countries. National publication or electronic media includes radio, newspapers, television, the internet and other media that is not intentionally directed to or targeted to individuals located in this state. The sending of a direct solicitation or electronic mail message to the internet address of an individual known to be located in this state is not an offer through a national publication or electronic media. 4. The person has acquired twelve or more timeshare interests in one or more voluntary or involuntary transactions and subsequently conveys, assigns or transfers twelve or more of the timeshare interests received to a single purchaser in a single transaction during the preceding twelve month period. C. The following are exempt communications from the provisions of this article: 1. Any stockholder communication including an annual report or interim financial report, proxy material, a registration statement, a securities prospectus, a registration, a property report or other material required to be delivered to a prospective purchaser by an agency of any state or the federal government. 2. Any oral or written statement disseminated by a developer to broadcast or print media, other than paid advertising or promotional material, regarding plans for the acquisition or development of timeshare property. Any rebroadcast or any other dissemination of such oral statements to a prospective purchaser by a seller in any manner or any distribution of copies of 32-2197.23 PROFESSIONS AND OCCUPATIONS 84 newspaper or magazine articles or press releases or any other dissemination of written statements to a prospective purchaser by a seller in any manner constitutes an advertisement and is not an exempt communication. 3. Any advertisement or promotion in any medium to the general public if the advertisement or promotion clearly states that it is not an offer in any jurisdiction in which any applicable registration requirements have not been fully satisfied. 4. Any audio, written or visual publication or material relating to the availability of any accommodations for transient rental if a sales presentation is not a requirement for the availability of the accommodations and if the failure of any transient renter to take a tour of a timeshare property or attend a sales presentation does not result in any reduction in the level of services that would otherwise be available to the transient renter. 5. Any billboard or other sign that is affixed to real or personal property and that is not disseminated by other than visual means to any prospective purchaser and that does not suggest or invite any action on the part of the prospective purchaser. D. The following communications are exempt from this article if the communications are delivered to any person who has previously executed a contract for the purchase of or is an existing owner of a timeshare interest in a timeshare plan: 1. Any communication addressed to and relating to the account of any person who has previously executed a contract for the sale or purchase of a timeshare interest in a timeshare plan relating to the communication. 2. Any audio, written or visual publication or material relating to an exchange company or exchange program provided to an existing member of the exchange company or exchange program. 3. Any communication by a developer to encourage a person who has previously acquired a timeshare interest from the developer to acquire additional use or occupancy rights or benefits or additional time2001 share interests offered by the same developer. Recent legislative year: Laws 2001, Ch. 170, § 22. 32-2197.24. Applicability of article A. This article applies to all of the following: 1. A timeshare property located in this state. 2. Timeshare plans with an accommodation or component site in this state if those timeshare plans are sold or offered to be sold to any individual located in this state. 3. Timeshare plans without an accommodation or component site in this state if the timeshare plans are sold or offered to be sold to any individual located in this state. B. This article does not apply to the following: 1. An exchange program except as provided in Subsection C. 2. Timeshare plans consisting of fewer than twelve timeshare interests whether or not an accommodation is located in this state. 3. Timeshare plans the use of which extends over any period of less than three years. 4. Timeshare plans, whether or not an accommodation is located in this state, under which the prospective purchaser’s total financial obligation will be less than one thousand five hundred dollars during the entire term of the timeshare plan. C. A method, arrangement or procedure that meets the definition of an exchange program pursuant to section 32-2197 shall be regulated as a timeshare plan in accordance with this article if the purchaser’s total contractual financial obligation exceeds three thousand dollars for any individual, recurring timeshare period. 2001 Recent legislative year: Laws 2001, Ch. 170, § 24. ARTICLE 10. MEMBERSHIP CAMPING 32-2198. Unlawful offer or sale of membership camping contract It is unlawful for any person to offer to sell or to sell within or from this state a membership camping contract unless a final membership camping public report has been issued by the commissioner. Any sale of a membership camping contract before the issuance of the final public report is voidable by the purchaser. 1989 32-2197.23. Power of commissioner to exempt timeshare plans A. The commissioner may by special order exempt from the provisions of this article timeshare plans upon written petition and upon a showing by the petitioner, satisfactory to the commissioner, that compliance with the provisions of this article is not essential to the public interest or for the protection of purchasers by reason of the special characteristics of the timeshare plan. B. Special orders issued pursuant to this section shall relate to specific timeshare plans. C. A petition filed under this section shall be accompanied by an initial fee of three hundred dollars. A fee is not returnable irrespective of the nature of the action upon the petition. 2001 Recent legislative year: Laws 2001, Ch. 170, § 23. 32-2198.01. Application for membership camping public report; signature; amendment A. An application for a membership camping public report shall contain the following documents and information: 1. The name and address of the membership camping operator. 2. A copy of the articles of incorporation, partnership agreement or joint venture agreement and the camping club association bylaws as contemplated or currently in effect. 3. A list of all officers and directors or persons occupying a similar status of the membership camping operator including their names, addresses and occupations during the last five years. 4. A list of material affiliates of the membership camping operator, including the names and addresses 85 REAL ESTATE 32-2198.01 of partners, officers, directors and persons with a direct or indirect interest of ten per cent or more in the membership camping operator. 5. A list of all owners of over ten per cent of the voting stock of the membership camping operator, except that this list is not required if the membership camping operator is a reporting company under the securities and exchange act of 1934. 6. Copies of forms of all advertisements intended to be used in connection with the offer or sale of membership camping contracts within this state. 7. A copy of each type of membership camping contract to be sold, a description of the purchase price of each type and, if the price varies, the reason for the variance. 8. A copy of any conditional use permit or any other major use permits indicating approval of the project by this state or a political subdivision of this state for each of the membership camping operator’s camping projects located in this state. If the membership camping operator has no projects in this state, the same documents shall be provided for all out of state projects for which membership contracts are to be sold or offered for sale in this state. 9. The financial statements of the membership camping operator prepared in accordance with generally accepted accounting principles and audited by an independent certified public accountant. 10. A statement of the total number of membership camping contracts intended to be sold in this state and the method used to determine this number including a statement of commitment that this total number will not be exceeded unless it is disclosed by an amendment to the registration. 11. If membership camping contracts are sold with different privileges or durations, a list of each type of membership camping contract and the approximate number of each type to be sold. 12. A copy of the agreement, if any, between the operator and any person owning, controlling or managing the campground. 13. The names of any other states or foreign countries in which an application for registration of the membership camping operator or the membership camping contract or any similar document has been filed. 14. Complete information concerning any adverse order, judgment or decree involving forgery, theft, extortion, conspiracy to defraud, a crime of moral turpitude or any other like conduct which has been entered by a court or administrative agency in connection with a campground or other business operated by the applicant or in which the applicant has or had an interest at the time of the acts which led to the order, judgment or decree. 15. A current title report which is signed and dated not more than thirty days before receipt by the commissioner and which provides a true statement of the condition of the title to the campground property, including all encumbrances on the property. 16. A statement on the provisions that have been made for permanent access and provisions, if any, for health department approved sewage and solid waste collection and disposal and public utilities, if any, in the proposed campground, including water, electricity, gas and telephone facilities. 17. A statement of the provisions, if any, limiting the use or occupancy of the campground, together with copies of any restrictive covenants affecting all or part of the campground. 18. A true statement of the approximate amount of indebtedness which is a lien on the campground or any part of the campground and which was incurred to pay for the construction of any on-site or off-site improvement or any community or recreational facility. 19. A true statement or reasonable estimate, if applicable, of the amount of any indebtedness which has been or is proposed to be incurred by an existing or proposed special district, entity, taxing area or assessment district within the boundaries of which the campground or any part of the campground is located, and which is to pay for the construction or installation of any improvement or to furnish community or recreational facilities to the campground, and which amounts are to be obtained by ad valorem tax or assessment, or by a special assessment or tax on the campground or any part of the campground. 20. A true statement as to the approximate amount, if any, of annual taxes, special assessments or fees to be paid by the membership camping contract owner for the proposed annual maintenance of common facilities in the campground. 21. A true statement of assurances for the installation of improvements, such as roads and utilities, and approval by the political subdivision having authority. 22. A true statement of provisions made for financing any community, recreational or other facilities to be included in the offering or represented as being in the offering. The statement shall include a trust agreement or other evidence of assurances for delivery of such facilities and a statement of the provisions, if any, for the continued maintenance of the facilities. 23. A true statement of the nature of any improvements to be installed or represented to be installed, the estimated schedule for completion and the estimated costs related to these improvements which will be borne by membership camping contract owners in the campground. 24. A true statement of the membership camping operator’s experience in the membership camping business, including the number of years the operator has been in the membership camping business. 25. A true statement of the nature of the purchaser’s right or license to use the membership camping operator’s property or facilities. 26. The location of each of the membership camping operator’s parks and a brief description for each park of the significant facilities then available for use by purchasers and those which are represented to purchasers as being planned, together with a brief description of any significant facilities that are or will 32-2198.02 PROFESSIONS AND OCCUPATIONS 86 be available to nonpurchasers or nonmembers. As used in this paragraph ‘‘significant facilities’’ includes campsites, swimming pools, tennis courts, recreation buildings, rest rooms and showers, laundry rooms and trading posts or grocery stores. 27. A true statement of the membership camping operator’s ownership of or other right to use the camping properties represented to be available for use by purchasers, together with the duration of any lease, license, franchise or reciprocal agreement entitling the membership camping operator to use the property, and any material provisions of any agreements which restrict a purchaser’s use of the property. 28. A copy of the rules, restrictions or covenants regulating the purchaser’s use of the membership camping operator’s properties, including a statement of whether and how the rules, restrictions or covenants may be changed. 29. A description of any restraints on the transfer of the membership camping contract. 30. A true statement of the policies relating to the availability of camping sites and whether reservations are required. 31. A true statement of any grounds for forfeiture of a purchaser’s membership camping contract. 32. Any other information, documents and certificates as the commissioner may reasonably require to clarify or ascertain the accuracy of the information required by this section. B. The application shall be signed by the membership camping operator, an officer or general partner of the membership camping operator or by another person holding a power of attorney for this purpose from the membership camping operator. If the application is signed pursuant to a power of attorney, a copy of the power of attorney or the resolution authorizing the signature shall be included with the application. C. The application must be submitted on a form prescribed by the commissioner with the application fee. D. An application for registration to offer to sell or sell membership camping contracts shall be amended when a material change to the information previously 1989 filed occurs. 32-2198.02. Issuance of public report; representations prohibited A. On examination of a membership campground, the commissioner, unless there are grounds for denial, shall issue to the owner or operator a public report authorizing the sale in or from this state of membership camping contracts. The report shall contain the data obtained in accordance with section 32-2198.01 and any other information which the commission determines is necessary to implement the purposes of this article. The commissioner shall require the owner or operator to reproduce the report and furnish each purchaser with a copy, taking a receipt. The owner and licensed broker shall each retain a receipt for at least five years from the date of its taking. B. The issuance of a public report is not deemed to be an endorsement by the commissioner of the membership camping contract, the operator or the campground. It is unlawful for a person to make or use any statement or promotional device which tends to indicate that issuance constitutes an endorsement. 1989 32-2198.03. Exemptions A. The following transactions are exempt from the provisions of section 32-2198: 1. An offer, sale or transfer by any one person of not more than one membership camping contract in any twelve month period any agent for the person, participating in more than one transaction in a twelvemonth period is not exempt from registration as a membership camping salesperson under this chapter if he receives a commission or similar payment for the sale or transfer. 2. An offer or sale by a government or subdivision of a government agency. 3. An offer, sale or transfer by a membership camping operator of a membership camping contract previously authorized if the offer, sale or transfer constitutes a transfer to an owner other than the original owner of the contract. B. The commissioner may by special order exempt from the provisions of section 32-2198 the offer for sale or the sale of membership camping contracts on written petition and a showing by the petitioner satisfactory to the commissioner that compliance with this chapter is not essential to the public interest or 1989 for the protection of purchasers. 32-2198.04. Examination of project by commissioner The commissioner, pursuant to an investigation conducted under section 32-2108 or an application for public report pursuant to section 32-2198.01, may examine any membership campground project offered or sold in this state and make his findings public. The total cost of travel and subsistence expenses incurred by the department in the examination shall be borne by the owner of the project on the basis of the actual cost to the department. 1989 32-2198.05. Contracts; cancellation A membership camping contract may be cancelled by a resident purchaser for any reason at any time before midnight of the third business day after the purchaser has signed and received a copy of the contract. A membership camping contract may be cancelled by a nonresident purchaser for any reason at any time before midnight of the seventh calendar day after the purchaser has signed and received a copy of the contract. To cancel a contract the purchaser may notify the campground operator of the cancellation in writing, by certified mail return receipt requested, or personal delivery, to an address in this state as specified in the contract. Proof of timely cancellation is satisfied if the certified letter is postmarked on or before midnight of the seventh day. All monies paid pursuant to the cancelled contract shall be fully refunded within thirty days of receipt of the notice of cancellation. If the purchaser executed any 87 REAL ESTATE 32-2198.08 credit or loan agreement through the campground operator to pay all or part of the camping services, the debt and security instruments shall also be returned within thirty days. The contract shall contain a conspicuous notice printed in at least ten point bold-faced type as follows: NOTICE TO PURCHASER You are entitled to a copy of this contract at the time you sign it. You may cancel this contract at any time, if a resident of this state, before midnight of the third business day or if a nonresident of this state before midnight of the seventh calendar day after receiving a signed copy of this contract. If you choose to cancel this contract, you must either: 1. Send a signed and dated written notice of cancellation by certified mail, return receipt requested. 2. Personally deliver a signed and dated written notice of cancellation to: (Name of Campground) (Address of Campground) If you cancel this contract within the time periods set forth above, you are entitled to a full refund of your money. If the last day for giving notice falls on a Sunday or holiday, notice is timely given if it is mailed or delivered as specified on the next business day. Refunds must be made within thirty days of receipt of the cancellation notice by the campground operator. 1989 32-2198.06. Execution of notes; assignment; purchaser’s defenses retained A. A membership camping contract shall not require the execution of any note or series of notes by the purchaser which if separately negotiated would terminate as to third parties any right of action or defense which the customer has against the campground operator. B. A right of action or defense arising out of a membership camping contract which the customer has against the campground operator shall not be terminated by assignment of the contract whether or not the assignee acquires the contract in good faith and for value. 1989 32-2198.08. Denial, suspension or revocation of a public report A. The commissioner may order that a public report be denied, suspended or revoked or an application for a public report be denied if he finds that the order is necessary for the protection of purchasers or owners of membership camping contracts and that any of the following is true: 1. The membership camping operator’s advertising, sales techniques or trade practices have been or are deceptive, false or misleading under section 441522. 2. The membership camping operator has failed to comply with any provision of this article or the rules pertaining to this article. 3. The membership camping operator is not financially responsible or has insufficient capital to warrant its offering or selling membership camping contracts or to complete proposed amenities. 4. The membership camping operator’s offering of membership camping contracts has worked or would work a fraud on purchasers or owners of membership camping contracts. 5. The membership camping operator’s application or any amendment to the application is incomplete in any material respect. 6. The membership camping operator has represented or is representing to purchasers in connection with the offer or sale of a membership camping contract that any property, facility, campsite or other development is planned without reasonable grounds to believe that the property, facility, campsite or other development will be completed within a reasonable time. 7. The membership camping operator has withdrawn from use all or any substantial portion of any campground, the rights of all purchasers at the affected location have not expired and no adequate provision has been made to provide a substitute campground of comparable quality and attraction in the same general area within a reasonable time after the withdrawal. 8. The membership camping operator or its agent made a representation which is false or misleading in any application, document or statement filed with the commissioner. 9. The membership camping operator has disseminated or caused to be disseminated any false or misleading promotional materials in connection with a campground. 10. The membership camping operator or any of his agents has failed to comply with any representation in the final public report or membership camping contract. 11. The owner, operator, agent, officer, director or partner, trust beneficiary holding ten per cent or more beneficial interest or, if a corporation, any stockholder owning ten per cent or more of the stock in such corporation has: (a) Been convicted of a felony or misdemeanor involving fraud, dishonesty, moral turpitude or any like offense, or involving a transaction in real estate, cemetery property, time-share intervals or membership camping campgrounds or contracts. (b) Been permanently or temporarily enjoined by order, judgment or decree from engaging in or continuing any conduct or practice in connection with the sale or purchase of real estate or cemetery property, time-share intervals, membership camping contracts or campgrounds, or securities or involving consumer fraud or the racketeering laws of this state. (c) Had an administrative order entered against him by a real estate regulatory agency or security regulatory agency. (d) Had an adverse decision or judgment entered against him involving fraud or dishonesty or involving the conduct of any business in or a transaction in 32-2198.09 PROFESSIONS AND OCCUPATIONS 88 real estate, cemetery property, time-share intervals or membership camping campgrounds or contracts. (e) Disregarded or violated any of the provisions of this chapter or the rules of the commissioner pertaining to this chapter. (f) Participated in, operated or held an interest in any entity to which subdivision (b), (c), (d) or (e) applies. B. Within thirty days after receipt of the order of denial, an applicant objecting to the denial of a public report may file a written request for a hearing. The commissioner shall hold the hearing within twenty days thereafter unless the party requesting the hearing has requested a postponement. If the hearing is not held within twenty days after a request for a hearing is received, plus the period of any postponement, or if a proposed decision is not rendered within forty-five days after submission, the order of denial shall be rescinded and a public report issued. C. The commissioner, on his own motion or if he has received a complaint and has satisfactory evidence that grounds exist as provided in subsection A of this section or that any person has deviated from the provisions of the public report, may conduct an investigation of such matter, may issue a summary order as provided in section 32-2157 or may hold a public hearing and, after the hearing, may issue such order or orders as he deems necessary to protect the public interest and ensure compliance with the law, the rules or the public report, or the commissioner may bring an action in any court of competent jurisdiction against the person to enjoin the person from continuing the violation, engaging the violation or doing any act in furtherance of the violation. The court may make such orders or judgments, including the appointment of a receiver, as may be necessary to prevent the use or employment by a person of any unlawful practices, or which may be necessary to restore to any person in interest any monies or property, real or personal, which may have been acquired by means of any practice in this article declared to be unlawful. D. If the commissioner has reasonable cause to believe that a person has engaged or is engaging in a practice declared to be unlawful by this article and that the person is concealing assets or self or has made arrangements to conceal assets or is about to leave this state and that the public health, safety or welfare so requires, the commissioner may apply to the superior court, ex parte, for an order appointing a receiver of the assets of the person or for a writ of ne exeat, or both. E. The court, on receipt of an application for the appointment of a receiver or for a writ of ne exeat, or both, shall examine the verified application of the commissioner and any other evidence that the commissioner may present the court. If satisfied that the interests of the public require the appointment of a receiver or the issuance of a writ of ne exeat without notice, the court shall issue an order appointing the receiver or issue the writ, or both. Unless the court determines that the interests of the public will be harmed by the giving of notice, the court shall set a time for a hearing and require that such notice be given as the court deems satisfactory. F. If the court appoints a receiver without notice, the court shall further direct that a copy of the order appointing a receiver be served on the person alleged to have engaged or to be engaging in a practice declared to be unlawful under this article by delivering the order to the last address of the person which is on file with the department. The order shall inform the person that he has the right to request a hearing within ten days of the date of the order and, if requested, that the hearing shall be held within twenty days from the date of the order. G. If the commissioner determines that the managing camp operator is not financially responsible or has insufficient capital, the commissioner may require a surety bond or if one is unobtainable, other evidence of financial assurances in accordance with generally accepted accounting principles and generally accepted commercial standards of financial responsibility satisfactory to the commissioner to assure the financial responsibility and sufficient capitalization of the membership camping operator or to assure the completion of proposed amenities. 1989 32-2198.09. Fees A. Each application for a membership camping public report shall be accompanied by a fee of five hundred dollars. B. Each application for amendment or renewal of a public report shall be accompanied by a fee of three hundred dollars. C. Each application for a special order of exemption shall be accompanied by a fee of one hundred 1989 dollars. 32-2198.10. Advertising plans; disclosures; lotteries and drawings A. Any advertising, communication or sales literature, including oral statements by salespersons or any other person, shall not contain: 1. Any untrue statement of material fact or any omission of material fact which would make the statements misleading in light of the circumstances under which such statements were made. 2. Any statement or representation that the membership camping contracts are offered without risk or that loss is impossible. 3. Any statement or representation or pictorial presentation of proposed improvements or nonexistent scenes without clearly indicating that the improvements are proposed and the scenes do not exist. B. It is unlawful for any owner, developer, agent or employee of any membership camping project or other person with intent directly or indirectly to sell membership camping contracts to authorize, use, direct or aid in any advertising, communication, sales literature or promotional practice which violates this section. C. This section does not apply to the owner or publisher of a newspaper or magazine or to any other publication of printed matter in which an advertise- 89 REAL ESTATE 32-2198.14 ment appears or to the owner or operator of a radio or television station which disseminates an advertisement if the owner, publisher or operator has no knowledge of the intent, design or purpose of the advertiser. D. The commissioner may adopt rules permitting lotteries and drawings for the purpose of inducing prospective buyers to attend a sales presentation or to take a campground tour and establishing requirements and conditions for lotteries and drawings. These requirements and conditions shall include that: 1. No membership camping operator may hold a lottery or drawing who does not also have pursuant to section 32-2198.14 a recorded nondisturbance agreement, a bond or irrevocable letter of credit or some other financial assurance acceptable to the commissioner. The commissioner may require the campground operator to provide an independent auditor’s report by a certified public accountant or other expert concerning the campground operator’s financial condition. 2. No lottery or drawing may be held unless approved in advance by the commissioner. 3. The membership camping operator shall submit an application for approval of a lottery or drawing on a form approved by the commissioner and a fee of at least one hundred dollars and not more than two hundred fifty dollars. 4. The department shall require the applicant to pay all costs of field inspections to audit or oversee the operation of any drawing or lottery, including mileage, lodging and time spent in the field inspections and any experts employed to assist the department. 5. The deed, title, cash amount or other prize or guarantee of the prize shall be held by the department or in a neutral escrow by a disinterested third party approved by the department, pending the award of the prize to the lottery or drawing winner. 6. Any lottery or drawing shall be limited in time, scope and geographic location. The estimated odds of winning and terms of the lottery or drawing shall be disclosed in writing to participants. 7. No fee may be charged to any person who participates in a lottery or drawing. 8. The commissioner may deny or revoke any authorization to conduct a lottery or drawing to any person if the campground operator or broker or a salesperson violates any statute or rule adopted or order issued by the commissioner. 9. Violations of any requirements or conditions set forth in this section or by rule shall be grounds for the commissioner to deny future applications to hold lotteries or drawings. 10. The membership camping broker is responsible at all times for the lawful and proper conduct of any lottery or drawing. E. No campground facility may be advertised or promoted in any way that appears to guarantee the unimpeded use of or access to campground properties, if a blanket encumbrance exists on the properties, unless a nondisturbance or other acceptable agreement has been recorded, filed and accepted by the department pursuant to section 32-2198.14. 1993 32-2198.11. Purchaser’s remedies A. A membership camping contract entered into in substantial reliance on any false, fraudulent or misleading information, representation, notice or advertisement of the campground operator or its agents is voidable at the option of the purchaser. Reasonable attorney fees shall be awarded to the prevailing party in any action under this chapter. B. Any waiver of the provisions of this article by the purchaser is void. C. A purchaser who is injured by a violation of this article may bring an action for the recovery of damages, reasonable attorney fees and, if the violation is wilful, punitive damages in the amount of five thou1989 sand dollars per violation. 32-2198.13. Construction of this article The provisions of this article are in addition to all other causes of action, remedies and penalties avail1989 able to this state or to the purchaser. 32-2198.14. Advertising availability of campgrounds to campground members; blanket encumbrances A. No membership campground may be advertised or promoted in any way that guarantees the unimpeded use of or access to the campground’s properties unless the membership camping operator applies for and receives approval by filing information satisfactory to the department guaranteeing that the purchasers of membership camping contracts cannot be denied access to and use of campground properties pursuant to the membership camping contracts. The department may require the applicant to pay for any costs of experts hired by the department to evaluate the application, nondisturbance clause or financial condition of the applicant. No lien or encumbrance may be construed to deny access and use. B. The applicant shall include satisfactory evidence that purchasers of campground memberships acquire an unimpeded and irrevocable right of access to and use of campground properties by means acceptable to the department, including: 1. A duly recorded nondisturbance agreement from each holder of a lien or encumbrance on a membership campground that provides minimally for: (a) Enforcement of the agreement by individual campground members. (b) Effectiveness of the agreement notwithstanding insolvency, bankruptcy of the membership campground operator or sale of the campground. (c) Binding successors in interest of both the campground membership operator and each holder of a lien or encumbrance. (d) Alternative means to continue operation of the campground if the campground operator, holder of a lien or encumbrance or purchaser who obtains title or possession of the campground ceases to act as operator. 2. A bond or irrevocable letter of credit posted by the membership camping operator in an aggregate principal amount sufficient to cover the indebtedness remaining under any lien or encumbrance. 32-2198.14 PROFESSIONS AND OCCUPATIONS 90 3. Other financial assurances reasonably acceptable to the department. 1993 Arizona Administrative Code Editor’s Note. — The rules contained in this publication were provided to LexisNexis by the Public Services Division of the Office of the Secretary of State. Though accurate at the time of publication, the rules contained herein are for reference purposes and may not contain all changes and additions. For update information, call the Public Services Division at (602) 542-4086. TITLE 4 PROFESSIONS AND OCCUPATIONS CHAPTER 28 STATE REAL ESTATE DEPARTMENT Authority: A.R.S. § 32-2107 ARTICLE 1. GENERAL PROVISIONS Section R4-28-101. R4-28-102. R4-28-103. R4-28-104. Table 1. Definitions Document Filing; Computation of Time Licensing Time-frames Development Inspection Fee Time-frames ARTICLE 2. REPEALED R4-28-201. Repealed ARTICLE 3. LICENSURE R4-28-301. R4-28-302. R4-28-303. R4-28-304. R4-28-305. R4-28-306. General License Requirements; Non-resident License Employing Broker’s License; Non-resident Broker License Renewal; Reinstatement Changes in Personal Information, License, or License Status; Professional Corporation or Professional Limited Liability Company Licensure; Administrative Severance Branch Office; Branch Office Manager Temporary License; Certificate of Convenience Unlawful License Activity ARTICLE 4. EDUCATION R4-28-401. R4-28-402. R4-28-403. R4-28-404. R4-28-405. Prelicensure Education Requirements; Waiver Continuing Education Requirements; Waiver; Distance Learning License Examinations Real Estate School Requirements, Course and Instructor Approval Business Brokerage Specialist Designation ARTICLE 5. ADVERTISING R4-28-501. R4-28-502. R4-28-503. R4-28-504. Repealed Advertising by a Licensee Promotional Activities Development Advertising ARTICLE 6. REPEALED Article 6, consisting of Section R4-28-601, repealed effective February 28, 1995. ARTICLE 7. COMPENSATION R4-28-701. Commission Sharing Disclosure ARTICLE 8. DOCUMENTS R4-28-801. R4-28-802. R4-28-803. R4-28-804. Repealed Conveyance Documents Contract Disclosures Rescission of Contract 91 TITLE 4. PROFESSIONS AND OCCUPATIONS Section R4-28-805. Public Report Receipt 92 ARTICLE 9. REPEALED Article 9, consisting of Sections R4-28-901 and R4-28-902, repealed effective February 28, 1995. ARTICLE 10. REPEALED Article 10, consisting of Section R4-28-1001, repealed by final rulemaking at 11 A.A.R. 506, effective March 5, 2005. R4-28-1001. R4-28-1002. Repealed Expired ARTICLE 11. PROFESSIONAL CONDUCT R4-28-1101. R4-28-1102. R4-28-1103. Duties to Client Property Negotiations Broker Supervision and Control ARTICLE 12. DEVELOPMENTS R4-28-1201. R4-28-1202. R4-28-1203. R4-28-1204. Renumbered Repealed Renumbered Repealed PART A. APPLICATION FOR PUBLIC REPORT, CERTIFICATE OF AUTHORITY, OR SPECIAL ORDER OF EXEMPTION R4-28-A1201. R4-28-A1202. R4-28-A1203. R4-28-A1204. R4-28-A1205. R4-28-A1206. R4-28-A1207. R4-28-A1208. R4-28-A1209. R4-28-A1210. R4-28-A1211. R4-28-A1212. R4-28-A1213. R4-28-A1214. R4-28-A1215. R4-28-A1216. R4-28-A1217. R4-28-A1218. R4-28-A1219. R4-28-A1220. R4-28-A1221. R4-28-A1222. R4-28-A1223. Development Name; Lot Sales; Applicant Development Map; Location; Land Characteristics Flood and Drainage; Land Uses; Adverse Conditions Utilities Water Supply Sewage Disposal Streets and Access Flood Protection and Drainage Improvements Common, Community, or Recreational Improvements Master Planned Community Assurances For Completion and Maintenance of Improvements Schools and Services Property Owners’ Association Development Use Development Sales Title Report and Encumbrances ADEQ Approval Registrations in Other Jurisdictions Condominium Developments Foreign Developments Cemetery Developments Membership Camping Developments Affidavit PART B. GENERAL INFORMATION R4-28-B1201. R4-28-B1202. R4-28-B1203. R4-28-B1204. R4-28-B1205. R4-28-B1206. R4-28-B1207. R4-28-B1208. R4-28-B1209. R4-28-B1210. R4-28-B1211. Expedited Registration For Improved Subdivision Lots and Unsubdivided Lands Conditional Sales Exemption Material Change; Public Report Amendments Cemetery Notice; Amendments Contiguous Parcels Filing with HUD Subsequent Owner Public Report Correction Options; Blanket Encumbrances; Releases Earnest Money Recordkeeping ARTICLE 13. ADMINISTRATIVE PROCEDURES R4-28-1301. R4-28-1302. R4-28-1303. R4-28-1304. R4-28-1305. R4-28-1306. R4-28-1307. R4-28-1308. R4-28-1309. R4-28-1310. R4-28-1311. R4-28-1312. Repealed Service of Pleadings Subsequent to Complaint and Notice Information Obtained in an Investigation Response; Default Notice of Appearance of Counsel Repealed Expired Repealed Repealed Rehearing or Review of Decision; Response; Decision Repealed Repealed 93 Section R4-28-1313. CHAPTER 28. STATE REAL ESTATE DEPARTMENT Correction of Clerical Mistakes R4-28-101 ARTICLE 14. REPEALED Former Article 14, consisting of Section R4-28-1401, repealed effective November 27, 1987. ARTICLE 1. GENERAL PROVISIONS R4-28-101. Definitions In addition to the definitions listed in A.R.S. § 32-2101 the following terms apply to this Chapter: ‘‘Active license’’ or ‘‘active status license’’ means a current license issued by the Department to a broker or salesperson that states the name of the broker that employs the broker or salesperson and the location at which the salesperson or broker is employed. If referring to an employing broker, it means a currently licensed employing broker with a currently licensed designated broker of record. ‘‘ADEQ’’ means the Arizona Department of Environmental Quality. ‘‘ADWR’’ means the Arizona Department of Water Resources. ‘‘Closing’’ means the final step of a real estate transaction, such as when the consideration is paid, all documents relating to the transaction are executed and recorded, or the deed is delivered or placed in escrow. ‘‘Credit hour’’ means 50 minutes of instruction. ‘‘Course’’ means a class, seminar, or presentation. ‘‘D.b.a.’’ means ‘doing business as’ and is a name, other than a person’s legal name, authorized by the Department for a licensee’s use in conducting business. ‘‘Distance learning course’’ means a course of instruction outside a traditional classroom situation consisting of computer-based interactive instructional material, requiring completion in the credit hours specified. A course that requires a student to read text, listen to audio tapes, or view video material without student participation, feedback, and remedial instruction is not a distance learning course. ‘‘Immediate family’’ means persons related to an individual by blood, marriage, or adoption, including spouse, siblings, parents, grandparents, children, and grandchildren. ‘‘Individual’’ means a natural person. ‘‘Material change’’ means any significant change in the size or character of the development, development plan, or interest being offered, or a change that has a significant effect on the rights, duties, or obligations of the developer or purchaser, or use and enjoyment of the property by the purchaser. ‘‘Non-resident license’’ means a license authorized under the provisions of 32-2122(A) issued to a person who has been domiciled in this state for less than one year and who does not meet any of the following: Has an Arizona driver’s license; Has an Arizona motor vehicle registration; Has been employed in Arizona; Has an Arizona voter registration; Has transferred banking services to Arizona; Has changed permanent address on all pertinent records; Is a domestic corporation or limited liability company; Has filed an Arizona income tax return with the Department of Revenue during the previous or current tax year; or Has received benefits from any Arizona public service department or agency, such as welfare, food stamps, unemployment benefits, or worker’s compensation. ‘‘Property interest’’ means a person’s ownership or control of a lot, parcel, unit, share, use in a development, including any right in a subdivided or unsubdivided land, a cemetery plot, a condominium, a time-share interval, a membership camping contract, or a stock cooperative. Historical Note Former Section R4-28-01 repealed, new Section R4-28-01 adopted effective May 1, 1980 (Supp. 80-3). Amended effective August 1, 1986 (Supp. 86-4). Former Section R4-28-01 renumbered without change as Section R4-28-101 (Supp. 87-1). Former Section R4-28-101 renumbered to R4-28-102, new Section R4-28-101 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final R4-28-102 TITLE 4. PROFESSIONS AND OCCUPATIONS 94 rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 8 A.A.R. 3640, effective August 6, 2002 (Supp. 02-3). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-102. Document Filing; Computation of Time A. All documents shall be considered filed on the date received by the Department. An original or renewal application postmarked on or before the end of the application or renewal deadline shall be considered timely. B. In computing any period of time allowed by these rules or by an order of the Commissioner, the day of the act, event, or default from which the designated period of time begins to run is not included. The last day of the period is included unless it is Saturday, Sunday, or a legal holiday in which event the period runs until the end of the next day that is not a Saturday, Sunday, or legal holiday. Unless the time period is specified as calendar days, when the period of time allowed is less than 11 days, intermediate Saturdays, Sundays, and legal holidays are excluded from the computation. Historical Note Former Section R4-28-02 repealed, new Section R4-28-02 adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Former Section R4-28-02 renumbered without change as Section R4-28-102 (Supp. 87-1). Former Section R4-28-102 repealed, new Section R4-28-102 renumbered from R4-28-101 and amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-103. Licensing Time-frames A. Overall time-frame. The Department shall issue or deny a license within the overall time-frames listed in Table 1 after receipt of a complete application. The overall time-frame is the total of the number of days provided for in the administrative completeness review and the substantive review. B. Administrative completeness review. 1. The applicable administrative completeness review time-frame established in Table 1 begins on the date the Department receives the application. The Department shall notify the applicant in writing within the administrative completeness review time-frame whether the application is incomplete. The notice shall specify what information is missing. If the Department does not provide notice to the applicant, the license application shall be considered complete. 2. An applicant with an incomplete license application shall supply the missing information within the completion request period established in Table 1. The administrative completeness review time-frame is suspended from the date the Department mails the notice of missing information to the applicant until the date the Department receives the information. 3. If the applicant fails to submit the missing information before expiration of the completion request period, the Department shall close the file, unless the applicant requests an extension in writing from the Department before expiration of the Response to Completion Request period in Table 1. The Department shall grant the applicant one extension for the number of days identified as the Response to Completion Request period for the type of license. An applicant whose file has been closed may obtain a license by submitting a new application. C. Substantive review. The substantive review time-frame established in Table 1 begins after the application is administratively complete. 1. The Department may schedule an inspection. 2. If the Department makes a comprehensive written request for additional information, the applicant shall submit the additional information identified by the request within the additional information period provided in Table 1. The substantive review time-frame is suspended from the date the Department mails the request until the information is received by the Department. If the applicant fails to provide the information identified in the written request the Department shall consider the application withdrawn unless the applicant requests in writing an extension from the Department before expiration of the Response to Additional Information period in Table 1. The Department shall grant the applicant one extension for the number of days identified in the Response to Additional Information period for the type of license. 3. If the application is denied, the Department shall send the applicant written notice explaining the reason for the denial with citations to supporting statutes or rules, the applicant’s right to seek a fair hearing, and the time period for appealing the denial. D. Renewals. If an applicant for renewal of a salesperson’s or broker’s license submits a complete renewal application: 1. Before the expiration date and there are no changes in the applicant’s license or qualifications pursuant to R4-28-301(A), the Department shall send the applicant notice that the license is renewed; 2. After the expiration date, or if a substantive review is required because the applicant wishes to make changes to or has answered in the affirmative any question on the license questionnaire, the Department shall process the application as a modified or amended application. Historical Note Amended as an emergency effective June 20, 1975 (Supp. 75-1). Former Section R4-28-03 repealed, new Section R4-28-03 adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-03 renumbered without change as Section R4-28-103 (Supp. 87-1). Former Section R4-28-103 95 CHAPTER 28. STATE REAL ESTATE DEPARTMENT Table repealed, new Section R4-28-103 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-104. Development Inspection Fee A fee shall be charged for a development site inspection pursuant to A.R.S. §§ 32-2182, 32-2194.02, 32-2195.02, 32-2197.05, and 32-2198.04, before or after issuance of a public report. Multiple inspections and fees may be required based on development circumstances. Historical Note New Section R4-28-104 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 8 A.A.R. 4917, effective January 5, 2003 (Supp. 02-4). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). Table 1. Time-frames (Calendar Days) R4-28-201 TITLE 4. PROFESSIONS AND OCCUPATIONS 96 Historical Note New Table 1 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). ARTICLE 2. REPEALED R4-28-201. Repealed Historical Note Former Section R4-28-04 repealed, new Section R4-28-04 adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Amended effective August 1, 1986 (Supp. 86-4). Former Section R4-28-04 renumbered and amended as R4-28-201 effective February 28, 1987 (Supp. 87-1). Amended effective February 28, 1995 (Supp. 95-1). Section R4-28-201 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). ARTICLE 3. LICENSURE R4-28-301. General License Requirements; Non-resident License A. An applicant for any Department-issued license or license renewal including, if an entity, any officer, director, member, manager, partner, owner, trust beneficiary holding 10% or more beneficial interest, 97 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-301 stockholder owning 10% or more stock, or other person exercising control of the entity, shall submit the following information to the Department: 1. A signed original licensure or renewal questionnaire, as applicable, disclosing any: a. Conviction for a misdemeanor or felony, or deferral of a judgment or sentencing for a misdemeanor or felony; b. Order, judgment, or adverse decision entered against the applicant involving fraud or dishonesty, or involving the conduct of any business or transaction in real estate, cemetery property, time-share intervals, membership camping contracts, or campgrounds; c. Restriction, suspension, or revocation of a professional or occupational license, or registration currently or previously held by the applicant in any state, district, or possession of the United States or under authority of any federal or state agency; any civil penalty imposed under the license, or any denial of a license; or d. Order, judgment, or decree permanently or temporarily enjoining the applicant from engaging in or continuing any conduct or practice in connection with the sale or purchase of real estate or cemetery property, time-share intervals, membership camping contracts, campgrounds, securities, or involving consumer fraud or violation of the racketeering laws by the applicant, or payment from a recovery fund or fund of last resort due to the applicant’s action or inaction. 2. If the applicant discloses information under subsection (A)(1), the applicant shall provide all of the following written documentation: a. A signed written statement describing in detail the circumstances surrounding the matter disclosed; b. A certified copy of any police report and court record that pertains to each crime for which the applicant has been convicted or for which sentencing or judgment has been deferred. If the applicant is unable to provide documents for each crime, the applicant shall provide written documentation from the court or agency having jurisdiction, stating the reason the records are unavailable. c. Three written and dated references from individuals, 18 years or older and not related by blood or marriage to the applicant, who have known the applicant for at least one year before the date of the Department’s receipt of the application. Each reference shall be dated no more than one year from the date the application is submitted to the Department and include the writer’s name, address, and telephone number; d. A 10-year work history, stating each employer’s name and address, supervisor’s name and telephone number, position held, and dates of employment, specifying any periods of unemployment; e. A certified copy of all documents pertaining to every reprimand, censure or sanction, order assessing a civil penalty, or denying, suspending, restricting, or revoking any professional or occupational license currently held or held by the applicant within the last 10 years; f. A certified copy of any civil judgment awarded by a court of competent jurisdiction against the applicant that included findings of fraud or dishonest dealings by the applicant; g. A certified copy of any document evidencing a payment of a judgment on behalf of the applicant by any recovery fund administered by any state or professional or occupational licensing board, or repayment by the applicant as a judgment debtor to any recovery fund administered by any state or professional or occupational licensing board. If an Arizona real estate or subdivision recovery fund matter, a written disclosure of the file number, approximate date, and approximate amount of payment and current repayment status satisfies this requirement. h. A certified copy of any temporary or permanent order of injunction entered against the applicant; i. Any other documentation that the applicant believes supports the applicant’s qualifications for licensure. 3. A full set of fingerprints as prescribed in A.R.S. § 32-2108.01; 4. The appropriate license application and fee; and 5. Social security number, if the applicant is an individual. B. In addition to the information required in subsection (A), an applicant for a salesperson’s or broker’s license shall provide information showing the person meet the qualifications listed in A.R.S. § 32-2124, A.A.C. R4-28-401, and R4-28-403. If disclosing censure, sanction, disciplinary action, or other order against any professional or occupational license currently or previously held by the applicant, the applicant shall submit a certified license history from each state in which the applicant holds, or has held, a professional or occupational license within the five years before the application. C. The Department shall not issue a broker’s license to any person who holds an active salesperson’s license in this state. An active-status salesperson applying for broker’s license may simultaneously submit a severance signed by the designated broker on behalf of the salesperson’s employing broker under R4-28-303(E)(10) or may request to be administratively severed under R4-28-303(G). D. The Department shall issue to a qualified person a license bearing the legal name of the licensee and any additional nickname, corporate, or dba name that the Commissioner finds is not detrimental to the public R4-28-302 TITLE 4. PROFESSIONS AND OCCUPATIONS 98 interest. A professional corporation or professional limited liability company licensed under A.R.S. § 32-2125(B) shall not adopt a dba name. E. Every salesperson and broker holding a current license shall file with the Commissioner both the address of the salesperson’s or broker’s principal place of business, if any, and a current residence address. F. Each salesperson, broker, school owner, director, administrator, and instructor shall, within 10 days of each occurrence, notify the Commissioner in writing of any change in information provided under subsection (A)(1)(a) through (d) and provide documentation listed in subsection (A)(2). G. A licensee shall, within 14 calendar days or a later date determined by the Department, respond to a request from the Commissioner or the Commissioner’s representative for any documents, electronic files, written statements, or other information required as a part of a complaint investigation, regardless of whether the licensee is named in the complaint. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Amended effective August 1, 1986 (Supp. 86-4). Former Section R4-28-05 renumbered without change as Section R4-28-301 (Supp. 87-1). Amended subsection (C) effective May 3, 1988 (Supp. 88-2). Amended subsection (J) effective February 28, 1989 (Supp. 89-1). Amended effective February 28, 1995 (Supp. 95-1). Amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-302. Employing Broker’s License; Non-resident Broker A. A person applying for an employing broker’s license shall provide the following information: 1. The name, business address, telephone number, fax number and e-mail address, if any, and designated broker’s name, license number and expiration date, and the signature of the designated broker; 2. Whether the broker is an individual, a sole proprietorship, corporation, partnership, limited liability company, professional corporation or professional limited liability company; 3. The mailing address, if different than the business address; 4. The d.b.a. name, if applicable; 5. The bank name and location of each of the broker’s trust accounts, if any; and 6. The name and number of the trust account. B. Partnership. 1. When the applicant is a partnership, the applicant shall name a broker to serve as designated broker: a. The designated broker shall be a partner of the general partner if the general partner is a partnership. b. The designated broker shall be a corporate officer of the corporate partner if the general partner is a corporation. c. The designated broker shall be a member of the member-managed limited liability company or manager of the manager-managed limited liability company if the general partner is a limited liability company. d. A limited partner of a partnership shall not be designated broker for the partnership. 2. In addition to the information provided in subsection (A), an applicant for an employing broker’s license as a partnership shall, if applicable, provide: a. The name and address of each partner, and the name of any other person with a beneficial or membership interest in the partnership; b. An agreement signed by all partners, stating the name of the partner appointed to act as the designated broker for the partnership; c. A written statement signed by the designated broker stating that: i. The partnership has applied for a broker’s license in Arizona; ii. Each partner has read the complete application on the named partnership as submitted to the Department; iii. All the information contained in the application is true; iv. Each general partner is qualified to do business in Arizona; and v. The name of the partnership complies with A.R.S. § 29-245 and subsections (H) and (I), and is not likely to be misleading or confusing; d. A copy of the partnership agreement and any amendments; e. A copy of the application for partnership registration stamped ‘‘Received and Filed’’ by the Arizona Secretary of State; and f. Any other information required by the Department to verify the applicant’s qualifications. C. Corporation. In addition to the information provided in subsection (A), an applicant for an employing broker’s license for a corporation shall provide: 1. The name and address of each officer and director, and the name and address of each shareholder controlling or holding more than 10% of the issued and outstanding common shares, or 10% of any other proprietary, beneficial, or membership interest in the corporation; 99 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-302 2. A copy of the Articles of Incorporation and any amendments stamped ‘‘Received and Filed’’ by the Arizona Corporation Commission. If more than one year has elapsed between the date the Articles were stamped ‘‘Filed’’ by the Arizona Corporation Commission and the application for the corporate license, a Certificate of Good Standing from the Arizona Corporation Commission is required; 3. A corporate resolution stating that the designated broker was elected or appointed as a corporate officer, naming the office held, and stating that the individual was appointed to act as designated broker for the corporation; 4. A written statement signed by the designated broker stating that: a. The corporation has applied for a broker’s license in Arizona; b. Each officer and director has read the complete application on the named corporation as submitted to the Department; c. All the information contained in the application is true; d. The name of the corporation complies with A.R.S. § 10-401 and 4 A.A.C. 28, Article 10, and is not likely to be misleading or confusing; and e. Each corporation is qualified to do business in Arizona; and 5. Any other information required by the Department to verify the applicant’s qualifications. D. Limited liability company. In addition to the information provided in subsection (A), an applicant for an employing broker’s license for a limited liability company shall provide: 1. The name and address of each member and manager, and the name and address of any person controlling or holding more than 10% of the membership interest in the limited liability company; 2. A copy of the Articles of Organization and any amendments stamped ‘‘Received and Filed’’ by the Arizona Corporation Commission. If more than one year has elapsed between the date the Articles were stamped ‘‘Filed’’ by the Arizona Corporation Commission and the application for the limited liability company license, a Certificate of Good Standing from the Arizona Corporation Commission is required; 3. A company resolution signed by all members stating whether management of the limited liability company is established as manager-controlled or member-controlled and the name of the member or manager appointed to act as the designated broker; 4. A written statement signed by the designated broker stating that: a. The limited liability company has applied for a broker’s license in Arizona; b. Each member and manager has read the complete application on the limited liability company as submitted to the Department; c. All of the information contained in the application is true; d. The name of the limited liability company complies with A.R.S. § 29-602 and 4 A.A.C. 28, Article 10, and is not likely to be misleading or confusing; and e. The limited liability company is qualified to do business in Arizona. 5. A copy of the operating agreement and any amendments; and 6. Any other information required by the Department to verify the applicant’s qualifications. E. Foreign entity. In addition to the requirements in this Section, the Department may require any of the following information from an entity applying for a broker’s license if a partner, member, officer, or director of the entity is domiciled in another state: 1. The agreement and plan of merger; 2. The Certificate of Good Standing; 3. The Certificate of Merger on file in the state in which the applicant is domiciled; 4. The Certificate of Merger on file with the Arizona Corporation Commission; 5. A filed and stamped Articles of Merger; 6. A filed and stamped application for registration of the foreign limited liability company, foreign corporation, or partnership; 7. Any other information required by the Department to verify the applicant’s qualifications. F. Self-employed broker. In addition to the information provided in subsection (A), any person applying as a self-employed broker shall provide a sworn statement attesting that the applicant is the sole proprietor of the business. G. If any information prescribed in subsections (A) through (F) changes, the designated broker shall, within 10 days after the change, file a supplemental statement in writing with the Department listing the change and include the appropriate fee, if any. H. The Department shall not license an employing broker or authorize an employing broker to do business under a dba name similar to that of any employing broker already licensed if the name would cause uncertainty or confusion to the public. If there is a conflict of names between two employing brokers, the Commissioner shall require the employing broker seeking licensure to supplement or otherwise modify the broker’s name. I. The Department shall not license an employing broker under more than one dba name and a person shall not conduct or promote real estate business under any name other than the name under which the person is licensed. R4-28-303 TITLE 4. PROFESSIONS AND OCCUPATIONS 100 J. A broker shall not employ a salesperson or associate broker and allow the salesperson or associate broker to establish and carry on a brokerage business if the broker’s only interest is the receipt of a fee for the use of the license and the broker does not exercise supervision over the salesperson or associate broker. K. Change of designated broker. 1. To resign as an employing broker’s designated broker a broker shall submit to the Department a copy of the broker’s letter of resignation and shall return the licenses issued to the designated broker and the employing broker to the Department. 2. A licensed entity may remove its designated broker by submitting to the Department a copy of the partnership agreement, corporate or company resolution removing the broker and returning to the Department the licenses issued to the employing broker and designated broker. 3. The employing broker whose designated broker has resigned or been removed shall cease conducting business until the employing broker has complied with subsection (K)(4). 4. An employing broker whose designated broker has resigned or been removed may continue business without interruption if the incoming designated broker on the same day as, or the next business day following, the departure or removal of the outgoing designated broker: a. Completes, signs, and submits the Change Form as prescribed in R4-28-303; and b. If the entity is a corporation or limited liability company, submits a resolution appointing the new broker to act on its behalf; or c. If the entity is a partnership, submits an amendment to the partnership agreement naming the new broker to act on its behalf. L. Non-resident employing broker. 1. An employing broker that holds a non-resident license and maintains a principal office outside this state shall: a. Maintain a trust account or licensed escrow account situated in Arizona for monies received from Arizona transactions; b. Maintain, in Arizona, copies of all documents pertaining to any Arizona transactions handled by the broker; c. Provide a written statement to the Department identifying the name, address, and telephone number of the person residing in Arizona, such as a statutory agent or attorney, who has possession of the records; and d. Identify the physical location of the records. 2. An employing broker that holds a non-resident license and employs a licensed salesperson or broker within the state shall: a. Establish an office in Arizona and appoint a branch manager; and b. Provide a statement describing how the licensed employee shall be supervised. 3. An employing broker who holds a non-resident license shall notify the Department within 10 days of any change to any information required under this Section. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Correction, Supp. 80-3 should read Adopted effective May 1, 1980 (Supp. 83-3). Amended subsection (B) effective August 1, 1986 (Supp. 86-4). Former Section R4-28-06 renumbered without change as Section R4-28-302 (Supp. 87-1). Amended effective February 28, 1995 (Supp. 95-1). Former Section R4-28-302 repealed, new Section R4-28-302 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-303. License Renewal; Reinstatement; Changes of Personal Information, License, or License Status; Professional Corporation or Professional Limited Liability Company Licensure; Administrative Severance A. Renewal. 1. If a salesperson or broker makes a timely and sufficient application for license renewal or a new license with reference to any activity of a continuing nature, the existing license does not expire until the application has been finally determined by the Department, and, in case the application is denied or the terms of the new license limited, until the last day for seeking review of the Commissioner’s order or a later date fixed by order of the reviewing court. 2. Any salesperson or broker applying for a license renewal shall submit the following information on the Application for License Renewal form: a. Any change or correction to the applicant’s licensing information; b. Whether the renewal application is late; c. If the renewal is for an active license and is filed in paper format, the Department shall require the application to include the date and signature of the designated broker, authorized branch office manager, or authorized designee under A.R.S. § 32-2127(D). If signed by a branch manager or designee, the branch manager or designee shall attach a copy of the authorization or designation; d. The signature of the applicant, attesting to the truthfulness of the application information; 101 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-303 B. C. D. E. e. A completed certification questionnaire, providing details and supporting documents for any affirmative response not previously disclosed in writing to the Department concerning judgments, orders, professional licenses, or convictions, as required under R4-28-301(A). f. To renew as designated broker for an employing broker, the designated broker shall complete and submit a signed Broker Supervision & Control Audit Declaration for the sole proprietorship or entity on whose behalf the broker acts as designated broker. The completed declaration shall: i. Be dated and filed before or with the broker’s renewal application, and submitted to the Department no earlier than 90 days before the broker’s license expiration date; ii. Be in the form prescribed by the Department; iii. State the broker’s compliance or non-compliance with, or the non-applicability of, specified statutes and rules; and iv. Identify all of the broker’s property management and trust accounts. Late renewal. In addition to the information required in subsection (A), any person applying for renewal after the date of license expiration shall specify whether the person conducted unlawful license activities as described in R4-28-306. Reinstatement. 1. Any salesperson or broker applying for license reinstatement under A.R.S. § 32-2131 shall, in addition to the requirements in R4-28-301(A), submit the following information on the Application For Reinstatement form: a. The type of license and status requested; b. The applicant’s legal name, business address, and telephone number; c. Whether the license was suspended, canceled, terminated, or revoked, and the date of and reason for the action; d. The license number of the applicant; e. The mailing address, if different than the business address; f. The name, address, and telephone number of the employing broker, if applicable; g. The employer’s trade or d.b.a. name, if any; h. The date of the application; and i. The signature of the applicant attesting to the above information and that the applicant is aware of the provisions in A.R.S. §§ 32-2131, 32-2153, and 32-2160.01. 2. If the license was active at the time of suspension, cancellation, revocation, or termination, the applicant shall provide the information required under R4-28-306. A salesperson or broker shall notify the Department in writing within 10 days of any change in the individual’s personal information or qualifications. The salesperson or broker shall include in the notice the individual’s name, signature, license number, and: 1. If disclosing information required under R4-28-301, such as a criminal conviction, adverse judgment, denial or restriction of or disciplinary action against a professional or occupational license, or recovery fund payment on the person’s behalf, a written statement providing detailed information and, upon request by the Department, the supporting documentation identified in R4-28-301(A)(2); 2. If requesting a change of personal name, written notice stating the prior name and new name, supporting documentation for the change, and applicable fee; 3. If changing residence address or residential mailing address, written notice stating the prior address, new address and the date of the change; 4. If changing residence telephone number or providing an additional telephone number or e-mail address, written notice of the prior and current number or e-mail address; or 5. If becoming licensed as a professional corporation or professional limited liability company, or changing licensure as a professional corporation or professional limited liability company, the information required under subsection (F). A designated broker shall notify the Department in writing within 10 days of any change in the employing broker’s qualifications under R4-28-301, and shall provide notice of any proposed change in the employing broker’s business information under this Section. An employing broker shall not conduct business under information described in subsections (E)(2), (3), (7), (9), (12), or (13) until the change is approved by the Department. The designated broker shall include in the notice the designated broker’s name and signature, the employing broker’s legal name, and: 1. If disclosing information required under R4-28-301 such as an adverse judgment, denial, or restriction of or disciplinary action against a professional or occupational license, or recovery fund payment on the person’s own behalf or on behalf of any officer, director, member, manager, partner, owner, trust beneficiary holding 10 percent or more beneficial interest, stockholder owning 10 percent or more stock, or other person exercising control of the employing broker, file with the Department a written statement within 10 days of the occurrence, providing detailed information and, upon request by the Department, the supporting documentation identified in R4-28-301(A)(2); 2. If changing the employing broker’s legal name, written notice stating the current name and proposed name, supporting documentation, and applicable fee; R4-28-303 TITLE 4. PROFESSIONS AND OCCUPATIONS 102 3. If changing the employing broker’s dba name, written notice stating the current dba name, if any, the proposed dba name, and applicable fee; 4. If changing the employing broker’s physical address, changing or adding a business mailing address, or changing the address of any branch office, written notice within 10 days of the change stating the prior address and new address, return all current licenses issued to the former address, and pay the applicable fee; 5. If changing business telephone number, written notice within 10 days of the change, providing the prior and current number. The broker may provide additional telephone numbers or e-mail addresses; 6. If changing the structure or membership of the employing broker as provided in A.R.S. § 32-2125 (G), written notice within 10 days of the change including supporting documentation identified in R4-28-302; 7. If changing branch office managers at an established branch office of the employing broker, or changing the authority delegated to the branch office manager, the application form, applicable fee, and letter of authority that identifies the person appointed and specifies the duties delegated as provided by R4-28-304; 8. If closing a branch office, a written statement informing the Department within 10 days of the closure, accompanied by the branch office license and Department form severing the employment of or transferring to another branch office each employee at the branch; 9. If hiring a salesperson or broker, or transferring a salesperson or broker employed by the employing broker to another office of the employing broker, a change form that includes the name, license number, signature of the employee, and the branch office address where the employee will work, and applicable fee; 10. If severing a licensee employed by the employing broker, written notice and return of the employee’s license within 10 days of the severance; 11. If opening or closing a broker’s trust account, written notice within 10 days of the opening or closing that provides the name of the account, the account number, and the name and address of the bank where the account is located. If relocating or changing the name of a trust account, the designated broker shall include the information for the previous and new accounts; 12. If appointing a temporary broker, submit the information specified in R4-28-305 and in accordance with provisions of A.R.S. §§ 32-2127 or 32-2133, as applicable; or 13. If an employing broker is changing designated brokers, the information and documentation provided in R4-28-302(K). F. In addition to the applicant’s name, signature, license number, the name and address of the employing broker’s office where the employee will work, and the change fee, a salesperson or broker shall submit the following information to be licensed as a professional corporation or professional limited liability company, to add or remove members of a licensed professional corporation or professional limited liability company, or to change the name of a licensed professional corporation or professional limited liability company: 1. Professional corporation. a. The name of the professional corporation that includes the full or last name of each officer, director, and shareholder of the professional corporation as it appears in the Articles of Incorporation; b. The name and business address of each officer, director, and shareholder in the corporation and a written statement that each holds a current and active real estate license; c. A copy of the Articles of Incorporation, as amended, stamped ‘‘Received and Filed’’ by the Arizona Corporation Commission; i. The Articles of Incorporation shall state that the corporation’s sole purpose is to provide professional real estate, cemetery, or membership camping services, or real estate, cemetery, and membership camping services. ii. If more than one year has elapsed between the date the Articles of Incorporation were stamped ‘‘Filed’’ by the Arizona Corporation Commission and the date of the application for a license as a professional corporation, the Department shall require the salesperson or associate broker to submit a Certificate of Good Standing from the Arizona Corporation Commission; and d. Evidence that membership in the professional corporation is limited to the designated broker and does not include any other person if the applicant for licensure as a professional corporation is licensed as a designated broker; 2. Professional limited liability company. a. The name of the professional limited liability company which includes the full or last name of each member of the professional limited liability company as it appears in the Articles of Organization; b. The name and address of each member and manager in the limited liability company and a written statement that each holds a current and active real estate license; c. A copy of the Articles of Organization, as amended, stamped ‘‘Received and Filed’’ by the Arizona Corporation Commission: 103 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-304 i. The Articles of Organization shall state that the limited liability company’s sole purpose is to provide professional real estate, cemetery, or membership camping services, or real estate, cemetery, and membership camping services. ii. If more than one year has elapsed between the date the Articles of Organization were stamped ‘‘Filed’’ by the Arizona Corporation Commission and the date of the application for a license as a professional limited liability company, the Department shall require the salesperson or associate broker to submit a certificate of Good Standing from the Arizona Corporation Commission. d. A copy of the operating agreement, as amended; and e. Evidence that membership in the professional limited liability company is limited to the designated broker and does not include any other person if the applicant for licensure as a professional limited liability company is licensed as a designated broker. 3. To return a license from professional corporation or professional limited liability company status to individual status: a. The name, license number, and dated signature of the salesperson or broker; b. A written statement that the salesperson or broker no longer wishes to be licensed as a professional corporation or professional limited liability company; and c. The change fee. G. Administrative severance. 1. A salesperson or broker may request that the Department sever the salesperson’s or broker’s license from the employing broker. The salesperson or broker shall provide the following information on a form or in the manner prescribed by the Department: a. The name, license number, and dated signature of the salesperson or broker seeking the severance; and b. The name of the employing broker from whom the license is being severed. 2. Upon receipt of the written request for severance as provided in subsection (G)(1)(a), the Department shall administratively sever the license and provide written notice to the employing broker, who shall return the severed person’s license to the Department under subsection (E)(10). Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Amended effective August 1, 1986 (Supp. 86-4). Former Section R4-28-07 renumbered without change as Section R4-28-303 (Supp. 87-1). Amended by adding a new subsection (K) effective May 3, 1988 (Supp. 88-2). Amended effective February 28, 1995 (Supp. 95-1). Former Section R4-28-303 repealed, new Section R4-28-303 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Subsection (F) amended to correct a manifest clerical error, filed in the Office of the Secretary of State March 29, 1999 (Supp. 99-3). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-304. Branch Office; Branch Office Manager A. To obtain a branch office license, the designated broker shall submit to the Department before operating the branch office the following information for each branch office of the employing broker on the Application for Branch Office form: 1. The name, date, and signature of the designated broker; 2. The license number and license expiration date of the employing broker; 3. The name, address, telephone, and license number of the main office; 4. The type of employing broker’s license; 5. The employing broker’s dba name, if applicable; 6. The address, telephone number, and fax number, if any, of the branch office; and 7. The name and license status of the salesperson or broker who is the branch office manager and the authority granted to the branch office manager, including any designation of authority under subsection (B). B. Branch office manager. A designated broker may authorize in writing an associate broker or salesperson to act as a branch office manager to perform any of the following duties of the designated broker at the branch office. This designation does not relieve the designated broker from any responsibilities. Upon change of the branch manager, the designated broker shall submit a new authorization to the Department within 10 days of the change and shall retain a copy in the broker’s main office for five years. 1. If the branch manager is an associate broker, the associate broker may, when dealing with branch office transactions: a. Review and initial contracts, b. Supervise the activity of salespersons and associate brokers, c. Hire or sever a salesperson or associate broker, d. Sign compensation checks, e. Be a signer on the branch office trust account and property management trust account, f. Write checks from the broker’s trust accounts, and R4-28-305 TITLE 4. PROFESSIONS AND OCCUPATIONS 104 g. Be responsible for the handling of all trust account funds administered by the branch manager. 2. If the branch manager is a salesperson, the salesperson may, when dealing with branch office transactions: a. Perform office management tasks that are not statutory duties of the employing broker, and b. Be a signer on the broker’s trust account and property management trust account. C. Temporary office. An additional license is not required for a temporary office established for the original onsite sale of properties within the immediate area of a subdivision or unsubdivided land. 1. The broker named in the application for public report shall supervise operation of the temporary office to sell or lease the subdivided or unsubdivided land. 2. The broker shall display the subdivision or unsubdivided land name and the licensed name of the employing broker marketing the development in a prominent manner at the entrance to the temporary office. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended subsection (A) effective June 23, 1983 (Supp. 83-3). Amended subsection (A)(4) effective August 1, 1986 (Supp. 86-4). Former Section R4-28-08 renumbered and amended as Section R4-28-304 effective February 28, 1987 (Supp. 87-1). Former Section R4-28-304 repealed, new Section R4-28-304 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-305. Temporary License, Certificate of Convenience A. Any individual applying for a temporary cemetery salesperson’s license, a temporary broker’s license, or a membership camping salesperson’s certificate of convenience shall submit the following information and applicable fee to the Department: 1. The type of license requested; 2. The name, address, telephone number, and date of birth of the applicant; 3. The mailing address if different from the address in subsection (A)(2); 4. The name, business address, telephone number, fax number, if any, and license number of the employing broker; and 5. The branch office number, address, telephone number, and fax number, if any, where employed, if different than the employing broker in subsection (A)(4). B. The designated broker shall submit an affidavit under A.R.S. § 32-2134 or 32-2134.01 for: 1. An applicant for temporary cemetery license stating that the applicant has been trained in cemetery and contract law; or 2. An applicant for a membership camping certificate of convenience stating that the applicant will be trained in membership camping and contract laws. C. In addition to the information required in subsection (A), an applicant for a temporary broker’s license pursuant to A.R.S. § 32-2133 shall submit the following information to the Department: 1. A copy of the death certificate or notice, if applicable, or a letter advising the Department of the broker’s illness or disability; and 2. A letter from the surviving spouse, an attorney representing the broker or the broker’s family, personal representative, or other responsible party, appointing an individual to serve as a temporary broker for 90 days. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended subsection (A) effective June 23, 1983 (Supp. 83-3). Amended subsection (A)(4) and (5) effective August 1, 1986 (Supp. 86-4). Former Section R4-28-09 renumbered without change as Section R4-28-305 (Supp. 87-1). Former Section R4-28-305 repealed, new Section R4-28-305 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-306. Unlawful License Activity A. Unlawful license activity is: 1. The performance of acts requiring a license under A.R.S. § 32-2122 by a person who does not hold a current and active license; 2. The performance of acts requiring a license by a person on behalf of a broker other than the person’s employing broker; or 3. A broker’s employment of a person as a salesperson or broker if the person does not hold a current and active license issued to the person under that employing broker. B. A person who conducts unlawful license activity shall submit to the Department, as soon as the person becomes aware that the activity has occurred, the following: 1. A written explanation of why the unlawful license activity occurred; 2. A signed statement from the person that the person will not conduct activities requiring licensure under A.R.S. § 32-2122 unless the person holds a current and active license to perform those acts; 3. A signed statement from the employing broker’s designated broker, identifying all unlawful activity by the person on behalf of the employing broker; 105 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-401 4. Upon request by the Department: a. A copy of all listing and employment agreements, offers or contract to buy, sell, lease, exchange, transfer, or manage real estate, cemetery property, or membership camping contracts prepared, negotiated or executed by the person while the person was not properly licensed under the employing broker; b. Documentation listing all compensation received or to be received by the person based on transactions that occurred while the person was not properly licensed; c. Documentation listing all compensation received or to be received by the person’s employing broker and designated broker, if any, resulting from transactions that occurred while the person was not properly licensed if not provided in response to subsection (B)(4)(b); and d. A signed statement from the person stating that the information provided under subsection (B)(4) is true and complete and that the copies provided are true copies of all contracts, agreements, statements, and leases and no relevant documents are omitted. C. A person who has no prior history of engaging in unlawful license activity under this Section, who conducted unlawful license activity for not more than 30 days and against whom there are no pending complaints may apply to renew the person’s license or for license change to active status. The Department shall not delay processing the application based on the unlawful licensed activity. The Department shall issue an Advisory Letter of Concern to the person. D. The Commissioner may take disciplinary action under A.R.S. § 32-2153 against a person who engages in unlawful license activity under this Section for longer than 30 days, has previously conducted unlawful license activity, or is the subject of a pending complaint. Historical Note New Section made by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). ARTICLE 4. EDUCATION R4-28-401. Prelicensure Education Requirements; Waiver A. Any individual applying for a real estate license shall either: 1. Complete the required 90-hour prelicensure education as prescribed in A.R.S. § 32-2124; or 2. Except for the 27-hour Arizona-specific course, apply for and be granted a waiver of the prelicensure courses. B. If the waiver request is based on prior education, the applicant shall submit a letter to the Commissioner that includes or demonstrates: 1. The name, mailing, and business address, daytime telephone number, and signature of the applicant; 2. The type of license sought; 3. The name and address of the school; 4. The course description or curriculum, including credit hours; and 5. Completion of one or more real estate courses. Acceptable evidence includes; a. A signed letter from a school representative or official transcript from a college or university, which indicates: i. The starting and ending dates of the course; ii. The number of semesters, quarters, and credit hours awarded per course; and iii. Whether the course examination was passed. b. Evidence of course completion provided as part of a certified license history from a state in which the applicant is currently or was previously licensed. C. If the waiver request is based on experience, or education and experience, the applicant shall submit a letter to the Commissioner that includes: 1. A detailed resume covering the previous 10 years, indicating duties performed and the name and telephone number for each employer; and 2. An original certified license history, including disciplinary action if any, from the real estate regulatory agency in each state in which the applicant is currently licensed and from any other state in which the applicant was licensed during the preceding 10 years; and 3. One or more of the following: a. Completion of one or more real estate courses. Acceptable evidence includes a signed letter from a school representative, or official transcript from a college or university, which identifies: i. The starting and ending dates of the course; ii. The number of semesters, or quarters, and credit hours awarded per course; iii. Whether the course examination was satisfactorily passed. b. Evidence of more than five years’ experience in a real estate related field; or c. Evidence of course completion provided as part of a certified license history from a state in which the applicant is currently or was previously licensed. R4-28-402 TITLE 4. PROFESSIONS AND OCCUPATIONS 106 D. The Department shall provide a copy of the prelicensure course content to any person requesting it. E. A person shall not receive credit for more than 10 hours of prelicensure education classes per day. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended subsections (F) and (G) effective March 13, 1981 (Supp. 81-2). Former Section R4-28-10 renumbered without change as Section R4-28-401 (Supp. 87-1). Amended by adding a new subsection (E) and renumbering accordingly effective March 7, 1988 (Supp. 88-1). Amended subsection (G) effective June 6, 1989 (Supp. 89-2). Amended effective February 28, 1995 (Supp. 95-1). Section R4-28-401 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-402. Continuing Education Requirements; Waiver; Distance Learning A. Continuing education requirements. 1. To be eligible for license renewal, a real estate salesperson or broker shall complete continuing education courses approved by the Department under R4-28-404, presented by a real estate school approved under R4-28-404, and taken since the salesperson’s or broker’s original licensure or effective date of the preceding license, whichever is later. 2. A real estate salesperson or associate broker applying for renewal shall submit proof of satisfactory completion of 24 credit hours of continuing education courses in the categories specified in subsection (A)(5). The renewal applicant shall complete a minimum of three hours in each of the mandatory categories under subsections (A)(5)(a) through (A)(5)(f). The renewal applicant shall take additional courses in the mandatory categories, or shall take courses in the business brokerage or general real estate categories described in subsection (A)(5)(g) and (A)(5)(h) to fulfill the required 24 credit hours. 3. A real estate designated broker applying for renewal shall submit proof of satisfactory completion of 24 credit hours of continuing education courses. The renewal applicant shall complete a minimum of three hours in each of the mandatory categories under subsections (A)(5)(a) through (A)(5)(f) and shall complete a Broker Management Clinic under A.R.S. 32-2136 approved in the Commissioner’s Standards category under subsection (A)(5)(c). The renewal applicant shall take additional courses in the mandatory categories, or shall take courses in the business brokerage or general real estate categories described in subsection (A)(5)(g) and (A)(5)(h) to fulfill the required 24 credit hours. 4. A salesperson renewing for the first time may include credit for attendance at the Contract Writing class taken under A.R.S. § 32-2124(L) if taken within one year before the date of the salesperson’s original licensure. A broker renewing for the first time may include credit for attendance at the Broker Management Clinic under A.R.S. § 32-2136 taken before the broker’s original licensure date. 5. The categories for real estate continuing education courses are: a. Agency law. The majority of class material concerns agency relationships and disclosure. b. Contract law. The majority of class material concerns the contract formation and implementation, or the results of contract use, including: i. Various contract forms and clauses, fundamentals, updates, options, offers, counter offers, first right of refusal, and exchanges; ii. Contract writing; iii. Required disclosures, problem-solving, and law and rule requirements; iv. Recent court decisions and case law studies; v. Breach of contract issues; vi. Legal, ethical and agency considerations, procedures, and disclosures; vii. Accommodating current financing procedures, requirements, and options. c. Commissioner’s standards. The majority of class material relates to license laws, including: i. Article 26 of the Arizona Constitution; ii. A.R.S. Title 32, Chapter 20, and A.A.C. Title 4, Chapter 28, which includes trust accounts, recordkeeping, license requirements, exemptions to licensure, commission payments, recovery fund provisions, development requirements, processes for public reports for and sale of subdivided and unsubdivided land, membership campgrounds and time-shares, cemetery regulations, and grounds for disciplinary action and hearings. iii. A.R.S. Title 44, Chapter 10, Article 3.1, Trade Names and Business Practices. d. Real estate legal issues. The majority of class material concerns existing real estate law, including: i. Sources of real estate law (constitutions, statutes, zoning, common), and the legal system; ii. Land and its elements (air, mineral rights, real and personal property); iii. Land, title, and interests in land, homestead, encumbrances, and the Landlord and Tenant Act; iv. Easements, fixtures, land descriptions, ownership, deeds, and building restrictions; v. Escrow procedures, financing documents, and lending laws and regulations, including Regulation Z; vi. Wills and estates, taxes, bankruptcy law, securities laws, title insurance, and appraisal law; vii. Case law studies, real estate fraud, disclosure law, interstate and international real estate; viii. Commission issues and forms of business ownership; 107 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-402 ix. Homeowners Association regulations; x. Real Estate Settlement Procedures Act (RESPA); and xi. Environmental issues. e. Fair housing. The majority of class material concerns equal opportunities in housing, including: i. Americans with Disabilities Act, ADA architectural designs (construction and development), and pertinent court cases; ii. Arizona and federal fair housing laws, including advertising, marketing, information, and enforcement; iii. Housing developments, deed restrictions, affordable housing, elder housing, zoning, local ordinances, and disclosures; iv. Commercial and residential concerns; and v. Administrative procedures and business practices. f. Disclosure. The majority of class material concerns the following: i. Licensee’s disclosure obligations to client and others; ii. Seller’s and buyer’s disclosure obligations to each other; iii. Common material facts warranting disclosure, and liability for failure to disclose; iv. Avoiding inadvertent non-disclosures; v. Transaction documents that should be reviewed; vi. Common ‘‘red flags’’ in a real estate transaction; vii. Homeowner associations and buyers’ obligations to homeowner associations; and viii. Advising buyers and sellers of common ‘‘red flags.’’ g. Business brokerage. The majority of class material concerns business brokerage including: i. Business brokerage basics including introducing licensees to business brokerage, associated terminology, marketing, prospecting, listing, pricing, closing practices, the use of contracts related to and unique to business brokerage, and the application of business brokerage contracts; ii. Business valuations and appraisals, and establishing an in-depth review of proper business valuation techniques for small, medium, and large businesses; iii. Tax structure and considerations, tax law, and policy including subjects such as financing tools available, options available, and tax implications; iv. Accounting for business brokers; v. Agency in business brokerages, the use of contracts related to and unique to business brokerage, and the application of business brokerage contracts; and vi. Disclosure issues in business brokerage, including common ‘‘red flags’’ in a business opportunity transaction, and advising buyers and sellers of common ‘‘red flags.’’ h. General real estate. The majority of class material concerns real estate, but does not fall within any of the categories listed in subsections (A)(5)(a) through (A)(5)(g), including: i. Appraisal methodology; ii. General finance, use of financial calculators, mathematics, and managing cash flow; iii. History of development in metropolitan areas; and iv. Introduction to property management. 6. The Department may require an individual applying for renewal to obtain credit hours based upon significant current issues in the real estate community. The Department shall notify licensees of a new requirement by written notice published in printed or electronic format. 7. The Department may grant continuing education credit for a course that does not have a certificate of approval under R4-28-404 if the applicant demonstrates to the satisfaction of the Commissioner that the course meets the requirements prescribed in R4-28-404 and the course content requirements of this Section. 8. An applicant may substitute subject matter hours within a 90-hour broker’s prelicensure course that meet the criteria for credit under subsections (A)(5)(a) through (A)(5)(h), if taken since the last license renewal, for the continuing education credit required in subsection (A)(2) or (3). 9. If any change in the continuing education course requirements occurs during a renewal applicant’s license period and the applicant has fully complied with the continuing education requirement in effect before the change occurs, the Department shall consider the renewal applicant to be in compliance with the continuing education requirements for the license period. B. Continuing education waiver. Under A.R.S. § 32-2130, the Commissioner may waive all or a portion of the continuing education requirement or grant additional time to complete a continuing education requirement when a salesperson or broker submits a written request to the Commissioner and shows good cause for the waiver or additional time. 1. Good cause may include: a. A person employed by the state or political subdivision establishes to the satisfaction of the Commissioner that the person’s employment during the prior license period involved real estate-related matters; R4-28-403 TITLE 4. PROFESSIONS AND OCCUPATIONS 108 b. Any officer or employee of the state whose license is on an inactive status due to a possible conflict of interest or other employment requirement; c. The person demonstrates successful completion of a course on topics specifically related to the person’s field of real estate practice; d. An approved real estate instructor requests a waiver for a course the instructor has taught; e. The salesperson or broker demonstrates other extraordinary circumstances. 2. A salesperson or broker is granted additional time by the Commissioner to complete the continuing education requirement for license renewal shall complete the continuing education hours by the deadline or be subject to disciplinary action. C. The Department shall not grant a person credit for more than nine hours of continuing education per day. D. Distance learning. 1. Only a school holding a Certificate of Approval shall offer a distance learning course. The school shall obtain course approval from the Department before advertising the course as approved by the Department for credit hours and before issuing Department credit hours for the course to students. 2. The Department shall not approve a distance learning course unless it contains: a. Individual modules of instruction for delivery on a computer or other interactive program; b. At least one learning objective for each module of instruction. The learning objective shall ensure that if all the objectives are met, the entire content of the course is understood; c. A structured learning method to enable the student to attain each learning objective; d. A diagnostic assessment of the student’s performance during each module of instruction; i. The assessment shall measure what the student learned throughout the module of instruction, and ii. Assess the comprehension of each concept covered in the module; e. Remediation. i. Repetition of a module if a student is deficient in a diagnostic assessment; and ii. Continuous repetition of the module until the student understands the content material. 3. An approved instructor shall teach and an approved instructor or the school director shall grade distance learning courses. The instructor or school director shall: a. Provide the student with assistance, if required; b. Obtain a signed certification statement from the student indicating that the student has completed each assignment of instruction; and c. Certify the student as completing a distance learning course only if the student: i. Completes all required instructional modules, ii. Attends any required hours of live instruction or testing, or both, for a given course; and iii. Passes a final examination. 4. As part of its application for approval of a distance learning course, a school shall file a plan with the Department describing how the school will deal with hardware and software failure. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended subsection (F) effective March 13, 1981 (Supp. 81-2). Former Section R4-28-11 renumbered without change as Section R4-28-402 (Supp. 87-1). Amended by deleting subsections (C) and (E) and renumbering accordingly effective March 7, 1988 (Supp. 88-1). Former Section R4-28-402 renumbered to Section R4-28-403, new Section R4-28-402 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-403. License Examinations A. The Department shall hold, or contract for, at least one state licensing examination each week. B. A state license examination shall not be returned to the applicant. The applicant shall be notified in person of the results of the examination by the words ‘‘passed’’ or ‘‘did not pass.’’ The results notification for an applicant who did not pass the examination shall also show the score for the examination and the relative score for each content area. C. Qualifying to take or passing a license examination does not constitute a waiver of the Commissioner’s right to deny issuance of a license if grounds exist pursuant to A.R.S. § 322153 or any other applicable statute. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-12 repealed, new Section R4-28-12 adopted effective August 28, 1986 (Supp. 86-4). Former Section R4-28-12 renumbered without change as Section R4-28-403 (Supp. 87-1). Amended effective February 28, 1995 (Supp. 95-1). Former Section R4-28-403 renumbered to R4-28-404, new Section R4-28-403 renumbered from R4-28-402 and amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-404. Real Estate School Requirements, Course and Instructor Approval A. Certificate of School Approval. Except for a community college or university accredited by the Council on Post Secondary Accreditation or the U.S. Department of Education offering courses in real estate, any school offering a course of study for original or renewal licensure of a real estate applicant shall apply for 109 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-404 and possess a Certificate of School Approval from the Department. The school’s authorized representative shall provide the following information on or with the Certificate of School Approval form: 1. The name, address, telephone number, and fax number, if any, of the school; 2. The name of the owner and d.b.a. name, if any; 3. Whether the owner is a sole proprietorship, partnership, trust, limited liability company, or corporation; 4. The name, address, telephone number, and percentage ownership of each person, entity, or beneficiary holding or controlling 10% or more financial interest in the school; 5. The name of each individual authorized to act on behalf of the school and sign continuing education certificates or prelicensure verifications, or both; 6. The name, business address, and telephone number of all current and prospective administrators, directors, and instructors; 7. In addition to the information required in R4-28-301(A), each school owner, administrator, director, and instructor shall provide a statement of the individual’s: a. Education, b. Teaching experience, and c. Employment history. 8. If the owner is a partnership, a copy of the partnership agreement naming the partner authorized to act on its behalf; 9. If the owner is a corporation or limited liability company, a copy of: a. A corporate or company resolution or operating agreement naming the officer, member, or manager authorized to execute the Certificate of Approval form; b. A current Certificate of Good Standing from the Arizona Corporation Commission; c. The latest annual report on file with the Arizona Corporation Commission; d. The Articles of Incorporation or Organization, as amended. 10. The location of school registration and licensing certification records. B. Certificate of Course Approval. Any school offering a course of study for original or renewal licensure of a real estate applicant shall apply for and possess a Certificate of Course Approval for each course offered by the school. The school’s authorized representative shall submit the following information: 1. The school name, address, telephone number, and fax number, if any; 2. The authorized representative’s name, title, and signature; 3. The title of the course; 4. A detailed outline of course material content that clearly lists the subject matter to be covered; 5. The date, time, and location of the anticipated presentation, if known; 6. The number of credit hours requested. The time allocated by a school for examination shall not be included in calculating credit hours if the examination is used for overall evaluation. 7. The category of approval requested; 8. A definition of segments if the course is to be offered in part and in its entirety; 9. If video or audio tapes will be used as instructional aids, the percentage of the class they will comprise; 10. The name of every instructor who will teach the course; and 11. The date of the application. C. Instructor approval. Any person wishing to teach an approved real estate course shall apply for an instructors approval, and shall have at least one of the following in the proposed subject area: 1. A bachelor’s or master’s degree in an area traditionally associated with real estate, such as business, law, economics, marketing, and finance; 2. An award of a generally-recognized professional real estate designation, such as Certified Commercial Investment Member, Graduate Realtor Institute, Certified Residential Specialist, Independent Fee Appraiser, or Member of the Appraisal Institute, and two years of postsecondary education from an accredited institution; 3. Experience in real estate, and a bachelor’s degree in education with a valid certificate issued within 15 years of the date of application for instructor approval; 4. A real estate salesperson’s or broker’s license, and is an employee or former employee of a regulatory agency; 5. A Distinguished Real Estate Instructor designation, with credentials in the specific subject; 6. At least three years real estate or specific subject experience; or 7. Other education or experience determined by the Commissioner to qualify the applicant as an instructor. D. The school shall maintain a record for five years of each student attending the school. The record shall include: 1. The name of each student; 2. The dates of attendance; 3. The title of each course taken; 4. The course number, category, and credit hours awarded; R4-28-405 TITLE 4. PROFESSIONS AND OCCUPATIONS 110 5. The final grade or score in each prelicensure course; and 6. The original signature roster for each course or course segment taught. E. The prospective student shall sign an agreement or application to enroll, presented to the student by the school representative, that includes the following, in bold type and capital letters: 1. The course or course segment title within a curriculum, 2. The total credit hours applicable for licensure or renewal, 3. The cost of each course, 4. A statement of the refund policy, and 5. A statement of any job placement service. F. The Department does not consider lists of employers given to graduates to be a placement service. The school may advertise job placement services only if: 1. Student referrals result from direct contact between the school placement service and prospective employers, 2. Documented evidence of student referrals is maintained and includes: a. The number of referrals to prospective employers per student, b. Results of referrals, c. Final placement or other disposition. G. Complaints. The Commissioner may, and upon a verified complaint in writing shall, investigate and observe the classes of any school, owner, administrator, director, or instructor acting on behalf of the school and may examine the books and records of the school in connection with the offering of approved courses. H. Change in school, course, or instructor. Each school owner, operator, director, and instructor shall: 1. Provide a written notice and supporting documentation within 10 days of any: a. Change of personal name or address, b. Change of business address, c. Change of business mailing address, d. School closing, or e. Disclosure of certification information pursuant to R4-28-301(A), 2. Provide a written notice and supporting documentation within 30 days after any change in structure of a licensed entity, including any change of a: a. Director, officer, or person holding or controlling 10% or more of the shares, if a corporation; b. Partner, if a partnership; c. Member or manager, if a limited liability company. 3. Obtain approval from the Commissioner before conducting business when: a. Changing a business name, b. Establishing a school location, c. Changing the course content, d. Changing the course length, or e. Offering a new course. 4. Provide written notice as soon as practical of a last minute change of instructor due to illness or emergency. Historical Note Section R4-28-404 renumbered from R4-28-403 and amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-405. Business Brokerage Specialist Designation A. The Department shall award the business brokerage specialist designation under A.R.S. § 32-2124(N) to a real estate salesperson or broker or an applicant for licensure as a real estate salesperson or broker who submits to the Department satisfactory proof that the licensee or applicant completed 24 credit hours of courses on business brokerage, approved by the Department under R4-28-404, as follows: 1. Either two 12-hour courses or three eight-hour courses that contain instruction on business brokerage practices, review and analysis of financial statements, including recasting, and business valuation; and 2. The applicant passes an examination on each course. B. A real estate salesperson or broker may request the designation from the Department by submitting to the Department satisfactory proof from the International Business Broker Association of having taken the courses and passed the course examinations described in subsection (A) within the five years before the request. Historical Note New Section made by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). 111 CHAPTER 28. STATE REAL ESTATE DEPARTMENT ARTICLE 5. ADVERTISING R4-28-503 R4-28-501. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-13 renumbered without change as Section R-28-501 (Supp. 87-1). Former Section R4-28-501 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-502. Advertising by a Licensee A. A salesperson or broker acting as an agent shall not advertise property in a manner that implies that no salesperson or broker is taking part in the offer for sale, lease, or exchange. B. Any salesperson or broker advertising the salesperson’s or broker’s own property for sale, lease, or exchange shall disclose the salesperson’s or broker’s status as a salesperson or broker, and as the property owner by placing the words ‘‘owner/agent’’ in the advertisement. C. A salesperson or broker shall ensure that all advertising contains accurate claims and representations, and fully states factual material relating to the information advertised. A salesperson or broker shall not misrepresent the facts or create misleading impressions. D. A school shall include its name, address and telephone number in all advertising of Department-approved courses. The school owner, director, or administrator shall supervise all advertising. The school owner shall ensure that the school’s advertising is accurate. E. A salesperson or broker shall ensure that all advertising identifies in a clear and prominent manner the employing broker’s legal name or the dba name contained on the employing broker’s license certificate. F. A licensee who advertises property that is the subject of another person’s real estate employment agreement shall display the name of the listing broker in a clear and prominent manner. G. The designated broker shall supervise all advertising, for real estate, cemetery, or membership camping brokerage services. H. A licensee shall not use the term ‘‘acre,’’ either alone or modified, unless referring to an area of land representing 43,560 square feet. I. Before placing or erecting a sign giving notice that specific property is being offered for sale, lease, rent, or exchange, a salesperson or broker shall secure the written consent of the property owner, and the sign shall be promptly removed upon request of the property owner. J. The provisions of subsections (E) and (G) do not apply to advertising that does not refer to specific property. K. Trade Names. 1. Any broker using a trade name owned by another person on signs displayed at the place of business shall place the broker’s name, as licensed by the Department on the signs; 2. The broker shall include the following legend, ‘‘Each (TRADE NAME or FRANCHISE) office is independently owned and operated,’’ or a similar legend approved by the Commissioner, in a manner to attract the attention of the public. L. The use of an electronic medium, such as the Internet or web site technology, that targets residents of this state with the offering of a property interest or real estate brokerage services pertaining to property located in this state constitutes the dissemination of advertising as defined in A.R.S. § 32-2101(2). Historical Note Former Section R4-28-14 repealed, new Section R4-28-14 adopted effective May 1, 1980 (Supp. 80-3). Amended subsection (D) effective August 1, 1986 (Supp. 86-4). Former Section R4-28-14 renumbered without change as Section R4-28-502 (Supp. 87-1). Section R4-28-502 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-503. Promotional Activities A. A licensee shall not describe a premium offered at no cost or reduced cost to promote sales or leasing as an ‘‘award,’’ or ‘‘prize,’’ or use a similar term. B. A licensee shall clearly disclose to a person in writing the terms, costs, conditions, restrictions, and expiration date of an offer of a premium before the person participates in the offer. C. Unless otherwise provided by law, a person shall not solicit, sell, or offer to sell an interest in a development by conducting a lottery contest, drawing, or game of chance. D. A subdivider, time-share developer, or membership camping operator may apply for approval to conduct a lottery, contest, drawing, or game of chance, or award a premium under A.R.S. § 32-2197.17(J), by submitting to the Department the information under A.R.S. §§ 32-2183.01(I), 32-2197.17(J) or 322198.10(D), the applicable fee, if any, and: 1. The name, address, telephone number, and fax number, if any, of the subdivider, time-share developer, or operator; 2. The legal name of the broker; 3. The public report number; R4-28-504 TITLE 4. PROFESSIONS AND OCCUPATIONS 112 4. The time and location for collecting entries for the lottery, contest, or drawing; 5. The date, time, and site for selection of a winner; and 6. The conditions and restrictions to enter, if any. Historical Note Former Section R4-28-15 repealed, new Section R4-28-15 adopted effective May 1, 1980 (Supp. 80-3). Amended effective August 1, 1986 (Supp. 86-4). Former Section R4-28-15 renumbered without change as Section R4-28-503 (Supp. 87-1). Section R4-28-503 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-504. Development Advertising A. If a developer obtains a conditional sales exemption, under R4-28-B1202, or registers a notice of intent with the Department to accept lot reservations under A.R.S. § 32-2181.03, the developer shall disclose on all advertising that only reservations or conditional sales contracts will be taken until the public report has been issued. B. Only a developer or the developer’s authorized representative shall file advertising for a development under A.R.S. §§ 32-2183.01(A), 32-2194.05(A), 32-2195.05(A), 32-2197.17(A) or 32-2198.01(A)(6) with the Department. C. A developer shall ensure that advertisement of property in a development includes the name of the development as registered with the Department. The Commissioner may waive application of this subsection if the Commissioner determines that the public interest is not affected. D. A developer shall not advertise a monthly payment, total price, or interest rate that is not available to all prospective purchasers or is restricted, unless the lack of availability or the restriction is conspicuously disclosed to all prospective purchasers within the advertisement. E. A developer shall not advertise proposed or incomplete improvements unless the following requirements are met: 1. The estimated date of completion is specified or, if there is no estimated date of completion, the developer includes a prominent disclosure in the advertisement that the improvement is proposed only and no warranty is given or implied that the improvement will be completed; and 2. If a completion date is specified, the developer has submitted to the Department evidence to satisfactorily demonstrate to the Department that the completion and operation of the facilities are assured and that completion will be within the time represented in the advertisement or promotional material. F. The developer shall not reference a proposed public facility or project that purports to effect the value or utility of an interest in a development without disclosing in writing the existing status of the proposed facility. The developer shall base the disclosure upon information supplied or verified by the authority responsible for the public facility or project and shall forward the information to the Department. G. Pictorial or illustrative depictions, other than unmodified photographs of the property being offered, shall bear a prominent disclosure identifying the nature of the depiction, such as an artist’s conception, and shall identify those improvements that are proposed and not in existence. H. When a pictorial representation is used in an advertisement for a specific development and is not an actual or accurate representation of the property, a statement within the advertisement shall prominently disclose the distance of the pictorial representation from the advertised property. I. If a map or diagram is used to show the location of the development in relation to other facilities, actual road miles from each facility to the development shall be shown on the map or diagram. J. A developer shall not expressly state or imply that a facility is available for the exclusive use of purchasers of lots or interests if a public right of access or public use of the facility exists. K. A developer shall not refer to availability for use of private clubs or facilities in which the owner will not acquire a proprietary interest through purchase of an interest in the development unless a disclosure is made in the advertisement. The disclosure shall affirmatively state the existence of the facilities and that availability for use by owners of an interest in the development is at the pleasure of the owners of the facility. L. When a standing body of water is described as a feature of a development, all advertising shall indicate the average surface area of the body of water. If a standing body of water or a flowing waterway described as a feature of a development is not permanent, or fluctuates substantially in size or volume, the developer shall disclose this fact in all advertisements describing the feature. M. At the time an incentive is offered to visit any place where a sales presentation for a development is to be made and before the recipient of the incentive makes the trip, the developer shall disclose in writing all conditions, limitations, or recipient qualifications that will be applied. N. A developer shall not include in advertising testimonials or endorsements that contain statements that a salesperson or broker would be precluded by law from making on the salesperson’s or broker’s behalf. Historical Note Editorial correction new language subsection (D)(2) (Supp. 75-1). Former Section R4-28-16 repealed, new Section R4-28-16 adopted effective May 1, 1980 (Supp. 80-3). Amended by adding subsection (T) effective March 13, 1981 (Supp. 81-2). Amended subsection (F) effective June 9, 113 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-803 1982 (Supp. 82-3). Amended effective August 1, 1986 (Supp. 86-4). Former Section R4-28-16 renumbered without change as Section R4-28-504 (Supp. 87-1). Section R4-28-504 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). ARTICLE 6. REPEALED R4-28-601. Repealed Historical Note Former Section R4-28-17 repealed, new Section R4-28-17 adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-17 renumbered without change as Section R4-28-601 (Supp. 87-1). Repealed effective February 28, 1995 (Supp. 95-1). ARTICLE 7. COMPENSATION R4-28-701. Compensation Sharing Disclosure A real estate broker shall disclose to all the parties in a transaction, in writing before closing, the name of each employing broker who represents a party to the transaction and who will receive compensation from the transaction. Historical Note Former Section R4-28-18 repealed, new Section R4-28-18 adopted effective May 1, 1980 (Supp. 80-3). Amended by adding subsection (B) effective March 13, 1981 (Supp. 81-2). Former Section R4-28-18 renumbered without change as Section R4-28-701 (Supp. 87-1). Section R4-28-701 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 8 A.A.R. 3640, effective August 6, 2002 (Supp. 02-3). ARTICLE 8. DOCUMENTS R4-28-801. Repealed Historical Note Former Section R4-28-19 repealed, new Section R4-28-19 adopted effective May 1, 1980 (Supp. 80-3). Amended effective August 28, 1986 (Supp. 86-4). Former Section R4-28-19 renumbered without change as Section R4-28-801 (Supp. 87-1). Amended subsection (A) effective November 27, 1987 (Supp. 87-4). Correction to subsection (D), from ‘‘...management shall...’’ to ‘‘...management agreement shall...’’ as certified effective August 28, 1986. Amended subsections (A), (C) and (D) effective June 6, 1989 (Supp. 89-2). Amended effective February 28, 1995 (Supp. 95-1). Former Section R4-28-801 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-802. Conveyance Documents A. Upon execution of any transaction document a salesperson or broker shall, as soon as practical, deliver a legible copy of the signed document and final agreement to each party signing the document. B. During the term of a listing agreement, a salesperson or broker shall promptly submit to the salesperson’s or broker’s client all offers to purchase or lease the listed property. Upon receiving permission from the seller or lessor, the salesperson or broker acting on behalf of the seller or lessor may disclose to all offerors or their agents the existence and terms of all additional offers on the listed property. The salesperson or broker shall submit to the client all offers made prior to closing and is not released from this duty by the client’s acceptance of an offer unless the client instructs the salesperson or broker in writing to cease submitting offers or unless otherwise provided in the listing agreement, lease, or purchase contract. The salesperson or broker may voluntarily submit offers to the seller or lessor regardless of any limitations contained in the listing agreement and may submit offers after the listing agreement is terminated. C. Transaction statements. In addition to the requirements of A.R.S. §§ 32-2151.01 and 32-2174, the broker shall retain true copies of all receipts and disbursements, or copies of the executed and delivered escrow closing statements that evidence all receipts and disbursements in the transaction. Historical Note Former Section R4-28-20 repealed, new Section R4-28-20 adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Former Section R4-28-20 renumbered without change as Section R4-28-802 (Supp. 87-1). Amended effective February 28, 1995 (Supp. 95-1). Section R4-28-802 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 8 A.A.R. 3640, effective August 6, 2002 (Supp. 02-3). R4-28-803. Contract Disclosures A. A developer or the developer’s agent shall ensure that any agreement or contract for the sale or lease of a property interest in a development that requires a public report contains substantially the following language in bold print or print larger than the other print used in the document above the signature portion of the document: R4-28-804 TITLE 4. PROFESSIONS AND OCCUPATIONS 114 THE DEVELOPER SHALL GIVE A PROSPECTIVE PURCHASER A COPY OF THE PUBLIC REPORT AND AN OPPORTUNITY TO READ AND REVIEW IT BEFORE THE PROSPECTIVE PURCHASER SIGNS THIS DOCUMENT. B. A developer or the developer’s agent shall ensure that any agreement or contract for the sale or lease of a property interest in a development conspicuously discloses the nature of the document at or near the top of the document. C. The contract shall indicate where the earnest money or down payment, if any, will be deposited and shall include the name of the title company, the name of the broker’s trust account, or other depository. D. Any agreement or contract for the sale or lease of a property interest in a development where a down payment, earnest money deposit, or other advanced money, if any, is paid directly to the seller and not placed in a neutral escrow depository, shall conspicuously disclose this fact within the document, and the purchaser shall sign or initial this provision indicating approval in the space adjacent to or directly below the disclosure in the purchase contract or agreement of sale. The following disclosure shall be written in large or bold print and shall be included in the public report, purchase contract, and agreement of sale. Prospective purchasers are advised that earnest money deposits, down payments, and other advanced money will not be placed in a neutral escrow. This money will be paid directly to the seller and may be used by the seller. This means the purchaser assumes a risk of losing the money if the seller is unable or unwilling to perform under the terms of the purchase contract. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended Exhibit effective March 13, 1981 (Supp. 81-2). Former Section R4-28-21 renumbered without change as Section R4-28-803 (Supp. 87-1). Section R4-28-803 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-804. Rescission of Contract A. Any agreement or contract for the purchase or lease of an unimproved subdivided lot, or any unsubdivided land, shall contain substantially the following language in bold print or print larger than the other print used in the document above the signature portion of the document: The purchaser or lessee has the legal right to rescind (cancel) this agreement without cause or reason of any kind, and to the return of any money or other consideration by sending or delivering a written notice of rescission to the seller or lessor by midnight of the seventh calendar day following the day the purchaser or lessee executed the agreement. If the purchaser or lessee does not inspect the lot or parcel before the execution of the agreement, the purchaser or lessee shall have six months to inspect the lot or parcel, and at the time of inspection shall have the right to unilaterally rescind the agreement. B. Any agreement or contract for the purchase or lease of a time-share interval shall contain substantially the following language in bold print or print larger than the other print used in the document above the signature portion of the document: The purchaser or lessee has the legal right to rescind (cancel) this agreement without cause or reason of any kind by sending or delivering a written notice of rescission to the seller or lessor by midnight of the seventh calendar day following the day the purchaser or lessee executed the agreement. C. An opportunity to exercise the seven-day right of rescission shall be provided by conspicuously disclosing the complete current name, address, and telephone number of the seller on the face of all agreements and contracts. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-22 renumbered without change as Section R4-28-804 (Supp. 87-1). Section R4-28-804 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). R4-28-805. Public Report Receipt When a public report is required, the developer shall complete the following public report receipt and obtain the purchaser’s signature to verify that the prospective purchaser has received a copy of the public report: PUBLIC REPORT RECEIPT The developer shall furnish you, as a prospective customer, with a copy of the public report required by the Arizona Department of Real Estate. It is recommended that you read the report before you make any written offer to purchase or lease an interest in the development and before you pay any money or other consideration toward the purchase or lease of an interest in the development. FOR YOUR PROTECTION, DO NOT SIGN THIS RECEIPT UNTIL YOU HAVE RECEIVED A COPY OF THE REPORT AND HAVE HAD THE OPPORTUNITY TO READ IT. BY SIGNING THIS RECEIPT, THE 115 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-1101 BUYER HAS ACCEPTED THE PUBLIC REPORT AND ACKNOWLEDGES THE INFORMATION IT CONTAINS. Public Report Registration No. Development Name and Lot No. I understand the report is not a recommendation or endorsement of the development by the Arizona Department of Real Estate, but is for information only. Buyer’s Name Address Date Historical Note New Section R4-28-805 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). ARTICLE 9. REPEALED R4-28-901. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended by adding subsection (E) effective August 28,1986 (Supp. 864). Former Section R4-28-23 renumbered without change as Section R4-28-901 (Supp. 87-1). Repealed effective February 28, 1995 (Supp. 95-1). R4-28-902. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 90-3). Amended effective March 13, 1981 (Supp. 81-2). Former Section R4-28-24 renumbered without change as Section R4-28-902 (Supp. 87-1). Repealed effective February 28, 1995 (Supp. 95-1). ARTICLE 10. REPEALED R4-28-1001. Repealed Historical Note Adopted effective May 31, 1980 (Supp. 80-3). Amended subsection (A) effective August 1, 1986 (Supp. 864). Former Section R4-28-26 renumbered without change as Section R4-28-1001 (Supp. 87-1). Section R4-28-1001 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Section repealed by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-1002. Expired Historical Note New Section R4-28-1002 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Section expired under A.R.S. § 41-1056(E) at 10 A.A.R. 1893, effective February 29, 2004 (Supp. 04-2). ARTICLE 11. PROFESSIONAL CONDUCT R4-28-1101. Duties to Client A. A licensee owes a fiduciary duty to the client and shall protect and promote the client’s interests. The licensee shall also deal fairly with all other parties to a transaction. B. A licensee participating in a real estate transaction shall disclose in writing to all other parties any information the licensee possesses that materially or adversely affects the consideration to be paid by any party to the transaction, including: 1. Any information that the seller or lessor is or may be unable to perform; 2. Any information that the buyer or lessee is, or may be, unable to perform; 3. Any material defect existing in the property being transferred; and 4. The existence of a lien or encumbrance on the property being transferred. R4-28-1102 TITLE 4. PROFESSIONS AND OCCUPATIONS 116 C. A licensee shall expeditiously perform all acts required by the holding of a license. A licensee shall not delay performance, either intentionally or through neglect. D. A licensee shall not allow a controversy with another licensee to jeopardize, delay, or interfere with the initiation, processing, or finalizing of a transaction on behalf of a client. This prohibition does not obligate a licensee to agree to alter the terms of any employment or compensation agreement or to relinquish the right to maintain an action to resolve a controversy. E. A real estate salesperson or broker shall not act directly or indirectly in a transaction without informing the other parties in the transaction, in writing and before the parties enter any binding agreement, of a present or prospective interest or conflict in the transaction, including that the: 1. Salesperson or broker has a license and is acting as a principal; 2. Purchaser or seller is a member of the salesperson’s, broker’s, or designated broker’s immediate family; 3. Purchaser or seller is the salesperson’s or broker’s employing broker, or owns or is employed by the salesperson’s or broker’s employing broker; or 4. Salesperson or broker, or a member of the salesperson’s or broker’s immediate family, has a financial interest in the transaction other than the salesperson’s or broker’s receipt of compensation for the real estate services. F. A salesperson or broker shall not accept compensation from or represent more than one party to a transaction without the prior written consent of all parties. G. A salesperson or broker shall not accept any compensation, including rebate or other consideration, directly or indirectly, for any goods or services provided to a person if the goods or services are related to or result from a real estate transaction, without that person’s prior written acknowledgement of the compensation. This prohibition does not apply to compensation paid to a broker by a broker who represents a party in the transaction. H. The services that a salesperson or broker provides to a client or a customer shall conform to the standards of practice and competence recognized in the professional community for the specific real estate discipline in which the salesperson or broker engages. A salesperson or broker shall not undertake to provide professional services concerning a type of property or service that is outside the salesperson’s or broker’s field of competence without engaging the assistance of a person who is competent to provide those services, unless the salesperson’s or broker’s lack of expertise is first disclosed to the client in writing and the client subsequently employs the salesperson or broker. I. A salesperson or broker shall exercise reasonable care in ensuring that the salesperson or broker obtains information material to a client’s interests and relevant to the contemplated transaction and accurately communicates the information to the client. A salesperson or broker is not required to have expertise in subject areas other than those required to obtain the salesperson’s or broker’s license. A salesperson or broker shall take reasonable steps to assist a client in confirming the accuracy of information relevant to the transaction. J. A salesperson or broker shall not: 1. Permit or facilitate occupancy in a person’s real property by a third party without prior written authorization from the person; or 2. Deliver possession prior to closing unless expressly instructed to do so by the owner of the property or property interest being transferred. K. A salesperson or broker shall recommend to a client that the client seek appropriate counsel from insurance, legal, tax, and accounting professionals regarding the risks of pre-possession or post-possession of a property. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-27 renumbered without change as Section R4-28-1101 (Supp. 87-1). Section R4-28-1101 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 8 A.A.R. 3640, effective August 6, 2002 (Supp. 02-3). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-1102. Property Negotiations Except for owner listed properties, negotiations shall be conducted exclusively through the principal’s broker or the broker’s representative unless: 1. The principal waives this requirement in writing, and 2. No licensed representative of the broker is available for 24 hours. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-28 renumbered without change as Section R4-28-1102 (Supp. 87-1). Section R4-28-1102 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1103. Broker Supervision and Control A. An employing broker and a designated broker shall exercise reasonable supervision and control over the activities of brokers, salespersons, and others in the employ of the broker. Reasonable supervision and control includes the establishment and enforcement of written policies, procedures, and systems to: 117 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-1203 1. Review and manage: a. Transactions requiring a salesperson’s or broker’s license; and b. Use of disclosure forms and contracts and, if a real estate broker, real estate employment agreements under A.R.S. § 32-2151.02; 2. Manage: a. Filing, storing, and maintaining documents pertaining to transactions under subsection (A)(5)(a); b. Handling of trust funds; and c. Use of unlicensed assistants by a salesperson or broker; 3. Oversee delegation of authority to others to act on behalf of the broker; 4. Familiarize salespersons and associate brokers with the requirements of federal, state, and local laws relating to the practice of real estate, or the sale of cemetery property or membership camping contracts; and 5. Review and inspect: a. Documents that may have a material effect upon the rights or obligations of a party to a transaction; and b. Advertising and marketing by the broker and by salespersons, brokers, and others in the broker’s employ. B. A designated broker shall establish a system for monitoring compliance with statutes, rules, and the employing broker’s policies, procedures, and systems. C. A designated broker shall supervise associate brokers, salespersons, and employees of the employing broker and shall exercise reasonable supervision and control over activities by the employing broker for which a license is required. D. An employing broker is responsible for the acts of all associate brokers, salespersons, and other employees acting within the scope of their employment. E. A designated broker may use the services of employees to assist in administering the provisions of this Section but shall not relinquish overall responsibility for supervision and control of the acts of the employing broker’s employees. F. A designated broker who, upon learning of a violation of real estate statutes or rules by a salesperson or associate broker under the broker’s supervision, immediately reports the violation to the Department is not subject to disciplinary action by the Department for failure to supervise the salesperson or broker. G. If an employing broker maintains one office and employs a designated broker, no more than one other licensed person, and no more than one unlicensed person, the employing broker and designated broker are not required to develop and maintain written policies, procedures, and systems as described in subsection (A). Historical Note New Section made by final rulemaking at 8 A.A.R. 3640, effective August 6, 2002 (Supp. 02-3). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). Amended by final rulemaking at 11 A.A.R. 1496, effective June 4, 2005 (Supp. 05-2). ARTICLE 12. DEVELOPMENTS R4-28-1201. Renumbered Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended subsection (B) effective June 9, 1982 (Supp. 82-3). Former Section R4-28-29 renumbered without change as Section R4-28-1201 (Supp. 87-1). Former Section R4-28-1201 renumbered to R4-28-B1205 by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1202. Repealed Historical Note Former Section R4-28-30 repealed effective May 1, 1980, new Section R4-28-30 adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Former Section R4-28-30 renumbered without change as Section R4-28-1202 (Supp. 87-1). Repealed effective February 28, 1995 (Supp. 95-1). R4-28-1203. Renumbered Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-31 renumbered without change as Section R4-28-1203 (Supp. 87-1). Former Section R4-28-1203 renumbered to R4-28-B1203 by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1204 R4-28-1204. Repealed TITLE 4. PROFESSIONS AND OCCUPATIONS 118 Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-32 renumbered without change as Section R4-28-1204 (Supp. 87-1). Section R4-28-1204 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). PART A. APPLICATION FOR PUBLIC REPORT, CERTIFICATE OF AUTHORITY, OR SPECIAL ORDER OF EXEMPTION R4-28-A1201. Development Name; Lot Sales; Applicant A. Any person may submit a development application for a public report, a certificate of authority, or a special order of exemption, provided the applicant has a recorded ownership interest in the land, such as a deed, option, beneficial interest in a trust, or other recorded interest approved by the Commissioner. The application for a public report or certificate of authority shall contain the following information, as applicable: 1. The name of the development or cemetery, as shown on the recorded map, and the marketing name if one will be used; 2. The list of the lots to be offered, including the description of the sales offering; 3. The name, address, telephone number, and fax number, if any, of the applicant; and 4. The applicable information in this Article, Parts A and B. B. If the applicant is a corporation, the application shall contain the following information: 1. A Certificate of Good Standing from the Arizona Corporation Commission, dated no earlier than one year from the date of the application; 2. A corporate resolution, authorizing the person signing the application on behalf of the corporation; and 3. The name and address of each officer, director, and shareholder controlling or holding more than 10% of the issued and outstanding common shares, or 10% of any other proprietary, beneficial, or membership interest in the entity. C. If the applicant is a partnership, the application shall contain the following information: 1. A copy of all partnership agreements; 2. Proof of registration with the Secretary of State if any partnership is a limited partnership, foreign or domestic; 3. If the general partner is a corporation, the information requested in subsection (B); 4. If the general partner is a limited liability company, the information requested in subsection (D); and 5. The name and address of each partner in the partnership. D. If the applicant is a limited liability company, the application shall contain the following information: 1. A copy of the Articles of Organization, stamped ‘‘Received and Filed’’ by the Arizona Corporation Commission. If more than one year has elapsed between the original filing with the Arizona Corporation Commission and the filing date of the development application, a Certificate of Good Standing from the Arizona Corporation Commission is required; 2. A copy of the operating agreement and any amendments; 3. If not included in the operating agreement or Articles of Organization, a copy of the company resolution signed by all members stating whether management of the limited liability company is established as manager-controlled or member-controlled and the name of the member or manager appointed to act on behalf of the company and sign the application; 4. The name and address of each member, manager, and managerial employee, and the name and address of any person controlling or holding more than 10% of the membership interest in the limited liability company; 5. If a member is a corporation, the information requested in subsection (B); 6. If a member is a partnership, the information requested in subsection (C). E. If the applicant is a trust, the application shall contain the name and address of each trustee, beneficiary, and anyone in control of the trust. F. If the applicant is a subsidiary corporation, the application shall contain the name and address of the parent corporation. Historical Note Section R4-28-A1201 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1202. Development Map; Location; Land Characteristics A. The applicant shall submit a legible copy, no larger than 11 x 17 , of the recorded development map showing, as applicable: 1. The county recorder’s recording information, including the book and page of maps and recording date; 2. County or city approval; 3. Applicable dedications; 119 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-A1204 4. Monuments, distances, and bearings; and 5. Registered land surveyor certification. B. The applicant shall identify the location of the development, including the street, city, county, and state, and: 1. The miles and direction from the nearest city or town, if applicable; and 2. The most direct route for getting to the development from a federal, state, county, or city road. C. The application shall include a description of the physical characteristics of the land and any unusual factors that may affect it, such as if it has level or hilly terrain, rocky, loose, or alkaline soil, and 1. The gross acreage of the development; 2. The total number of lots within the development, including a description of phasing, if applicable; and 3. Whether and how lots are permanently or temporarily staked or marked for easy location. Historical Note Section R4-28-A1202 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1203. Flood and Drainage; Land Uses; Adverse Conditions The applicant shall state, or include as applicable: 1. Whether the development is subject to any known flooding or drainage problems and a letter bearing the signature and seal of a professional civil, city, and county engineer, or county flood district detailing the drainage conditions and flood hazards. The letter shall include the effect of any flood plain and its location, the effect of a 100 year frequency storm, and whether flood insurance is required. 2. Whether the development lots are subject to subsidence or expansive soils. If subsidence or expansive soils exist, a professional engineer’s letter addressing the effects of the condition, remedies, and a buyer’s on-going responsibilities in plain language; 3. A description of the existing and proposed land uses in the vicinity of the development that may cause a nuisance or adversely affect lot owners, such as freeways, airports, sewer plants, railroads, and canals, including: a. Any unusual safety factors within or near the development, and b. A description of all current and proposed adjacent land uses. 4. Whether the development is affected by any unusual or unpleasant odors, noises, pollutants, or other nuisances; 5. A description of any agricultural activity or condition in the area that may adversely affect a lot owner, including any odors, cultivation and related dust, agricultural burning, application of pesticides, or irrigation and drainage; 6. Whether the development lots are subject to any known geological or environmental condition that would or may be detrimental to a purchaser’s health, safety, or welfare; or 7. Whether the development lots are located within the boundary of a federal, designated Superfund site or a state designated Water Quality Assurance Revolving Fund site. Historical Note Section R4-28-A1203 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1204. Utilities The applicant shall include information about electrical, telephone, and natural gas utilities available to the development, including: 1. The names, addresses, and telephone numbers of the electrical, telephone, and natural gas company that will provide service; 2. The location of existing electrical, telephone, and natural gas utilities in relation to the development; 3. The name of each person responsible for extending each utility to the lot lines; 4. The estimated completion date for extending each utility to the lot lines; 5. If the developer will only install conduit, a description of the arrangement made to complete operational utilities to lot lines; 6. The estimated cost a lot purchaser will be required to pay for completion of each utility to the purchaser’s lot line, and, if the offer is for unimproved lots, the estimated costs to provide service from the lot line to the dwelling; 7. Upon completion of the utilities, other costs or requirements that must be addressed before the lot purchaser receives service, including the current service charges, hookup fees, turn-on fees, meter fees, and fees for pulling wire through conduit; 8. If propane gas will be used, a letter from the supplier stating that it will be providing service to the development, with a description of requirements to be met and costs to be paid by the lot purchaser for receiving the service; and R4-28-A1205 TITLE 4. PROFESSIONS AND OCCUPATIONS 120 9. If street lights will be available, the person responsible for completion, the estimated completion date and the person who will pay for the electricity. Historical Note Section R4-28-A1204 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1205. Water Supply An applicant shall include information about any water supply to the development, including: 1. The type of water provider such as a municipal system, improvement district, public utility, private water company, co-operative, irrigation district, private well, water hauler, or other source; 2. The name, address, and telephone number of the water provider; 3. The compliance status of the water provider with federal and state environmental laws, as of the date of the application. If in noncompliance, provide an explanation; 4. The location of the water lines closest to the development; 5. The name of the person responsible for extending the water lines to the lot lines; 6. The estimated completion date for extending the water lines to the lot lines; 7. The estimated cost a lot purchaser will be required to pay for completion of the water lines to the purchaser’s lot line; 8. The estimated cost a lot purchaser will pay for completion of water lines from the lot line to a dwelling; 9. Other costs or requirements before the lot purchaser receives water service, including the current service charges, hookup fees, turn-on fees, meter fees, and development fees; 10. The name of the person responsible for maintenance of the water lines within the development, other than from lot line to dwelling; 11. The name of the person who is or will be responsible for maintenance of the water lines outside the development; 12. If a private well will be used, a description of the requirements and costs involved to install an operational domestic water system; 13. If the source of water is a private well and domestic water cannot be obtained from a private well, whether the purchaser will be offered a refund of the purchase price and if so, an explanation of any condition or restriction involving the refund; 14. The name and location of the water provider if domestic water will be transported or hauled by the lot purchaser. A cost estimate computed on a monthly basis for a four-member family, including the cost of water, cistern, and other holding tanks, pumps, or any other costs necessary to install an operational water system; 15. A water adequacy report from ADWR if the development is a subdivision or part of a subdivision located outside of a groundwater active management area; 16. A water availability report from ADWR if the development is unsubdivided land. A copy of the report or a brief summary of the report, approved by the Department, shall be displayed in all promotional material and contracts for sale; and 17. If a water provider is a public service corporation, whether a Certificate of Convenience and Necessity from the Arizona Corporation Commission has been issued and, if not, an explanation of why a Certificate has not been issued. Historical Note Section R4-28-A1205 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). R4-28-A1206. Sewage Disposal The applicant shall include information about sewage disposal for the development, including: 1. Whether the sewage disposal will be provided by a municipality, improvement district, public utility, private company, or individual sewage disposal system; 2. The name, address, and telephone number of the sewage disposal company; 3. The compliance status of the sewage disposal provider with the ADEQ as of the date of the application. If in noncompliance, provide an explanation; 4. The name of the person responsible for extending the sewage disposal utility to the lot lines; 5. The estimated completion date for extending the utility to the lot lines; 6. The estimated cost the lot purchaser will be required to pay for completion of the utility to the purchaser’s lot line; 7. If offering an unimproved lot, the estimated cost a lot purchaser will pay for completion of the utility from the lot line to the dwelling; 8. Upon completion of the utility, other costs or requirements that must be addressed before the lot purchaser receives service, including the service charge, hookup fees, tap-in fees, and development fees; 121 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-A1207 9. The name of the person responsible for maintenance of the sewage disposal utility within the development, other than from lot line to dwelling; 10. The name of the person who is or will be responsible for maintenance of the sewage disposal utility outside the development; 11. What cost, if any, will the lot purchaser pay toward maintenance of the sewage disposal utility; 12. If a sewage disposal provider is a for-profit public service corporation, whether a Certificate of Convenience and Necessity from the Arizona Corporation Commission has been issued, and if not, an explanation of why a Certificate has not been issued; 13. A description of the type of individual sewage disposal system the lot purchaser will be required to install in accordance with the standards and requirements of ADEQ or its designee; 14. A description of all requirements and costs involved to install an operational individual sewage disposal system, including any cost for governmental licensing and permitting, equipment, and other installation, maintenance, and operation costs; 15. If an operational individual sewage disposal system cannot be installed, will the lot purchaser be offered a refund of the purchase price, and if so, an explanation of any condition or restriction involving the refund; and 16. If a dry sewer system will be installed for future connection to a future provider, the name of the future provider, all requirements and costs for lot purchasers, and the estimated connection date. Historical Note Section R4-28-A1206 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1207. Streets and Access A. The applicant shall include a statement attesting that: 1. Exterior streets providing access are private; or federal, state, and county highways; or municipal streets; 2. The interior streets are public or private; and a. If any streets are private, a description of what provisions have been made to assure purchasers of a legal right to use the private streets; b. Whether the streets are completed; c. The standards to which the streets will be or are constructed; d. If the streets are not completed, the person responsible for completion and the estimated completion date; e. The type of existing and proposed surfacing; f. The cost, if any, the lot purchaser will pay toward street completion; g. The name of the person responsible for exterior and interior street maintenance; h. Whether a city or county is responsible for maintaining the streets and the approximate date when streets will be accepted for maintenance; and i. The cost, if any, the lot purchaser will pay toward street maintenance. B. The applicant shall demonstrate that there is permanent access to the land over terrain that may be traversed by conventional 2-wheel drive automobiles and emergency vehicles by providing any of the following information or documents necessary to make the demonstration: 1. A statement from a title insurance company, signed by an authorized title officer, affirming that legal access exists to the development and lots within the development. The statement shall: a. Describe the legal access by listing all recorded instruments which establish legal access, b. Be accompanied by a map on which legal access is shown with accurate references to the recorded instruments, c. Be accompanied by a legible copy of each recorded instrument listed in the statement. 2. A statement bearing the seal and signature of a registered land surveyor or professional engineer, affirming that legal access to and within the development, as described in the title insurance company legal access statement, is over terrain that can be traversed by conventional 2-wheel drive automobiles and emergency vehicles. The statement shall affirm that: a. The legal access corresponds with the actual physical access to the development and to the lots, b. The legal access is permanent and describe how that permanence is assured. 3. The recorded subdivision map which shows approval by the applicable city or county officials. 4. Recorded easements or road dedications whether public or private. If private, the applicant shall ensure that development lot owners, emergency vehicles, and utility service providers have access rights. 5. Land, on which easements and roads are provided, is traversable by conventional 2-wheel drive automobiles and emergency vehicles. 6. Road maintenance programs that assure permanent access. Road maintenance programs include those administered by city or county governments, city or county improvement districts, or private property owner associations. R4-28-A1208 TITLE 4. PROFESSIONS AND OCCUPATIONS 122 7. Recorded documentation that establishes legal and permanent access for development lot owners through federal or state lands. Historical Note Section R4-28-A1207 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1208. Flood Protection and Drainage Improvements The applicant shall include with the application the following information about flood protection and drainage improvement: 1. A description of any current or proposed improvement; 2. The name of the person responsible for completion of the improvement; 3. The estimated completion date of the improvement; 4. The cost, if any, the lot purchaser will pay for completion of the improvement; 5. The name of the person responsible for the continuing maintenance and expense of the improvement; 6. If a city or county is responsible for maintenance, the approximate date when the improvement will be accepted for maintenance; and 7. The cost, if any, the lot purchaser will pay toward completion and maintenance of the improvement. Historical Note Section R4-28-A1208 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1209. Common, Community, or Recreational Improvements The applicant shall provide with the application a list of all common, community, or recreational improvements, located within the development, and include the following information: 1. The name of the person responsible for completion of each improvement; 2. The estimated completion date of each improvement; 3. The estimated cost a lot purchaser will be required to pay for the completion of each improvement; 4. The name of the person responsible for the continuing maintenance and expense of each improvement; and 5. The cost, if any, the lot purchaser will be responsible for paying toward the maintenance of each improvement. Historical Note Section R4-28-A1209 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1210. Master Planned Community The applicant shall include the following information about a master planned community: 1. A list of all improvements located outside the development, but included in the development offering, including all common, community and recreational improvements; 2. The name of the person responsible for completing each improvement; 3. The estimated completion date of each improvement; 4. The name of the person responsible for the continuing maintenance and expense of each improvement; and 5. The cost, if any, the lot purchaser will pay toward the completion and maintenance of each improvement. Historical Note Section R4-28-A1210 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1211. Assurances for Completion and Maintenance of Improvements A. The applicant shall identify: 1. Whether arrangements have been made to assure the completion, delivery, and continued maintenance of the improvements listed in subsections R4-28-A1204 through R4-28-A1210; and 2. Whether the assurances to complete and deliver the improvements have been approved by the county or city, where applicable, and if so, submit a copy of the county or city approval; B. An applicant shall provide one or more of the following assurances for completion: 1. A surety or completion bond from an insurance company licensed in Arizona with a rating of good or higher from a rating agency and a copy of the rating. The bond shall specify which improvements are included and shall: a. Be stipulated by and payable to a third party who is not the developer; b. Be accepted and signed by all parties; 123 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-A1211 2. 3. 4. 5. 6. 7. c. Include an expiration date not less than 90 days beyond the last improvement estimated completion date; d. State when and how the third party may draw on the funds; e. Be in an amount 10% greater than the estimated amount to complete all improvements; and f. Include a registered engineer’s, architect’s, or contractor’s cost estimate to complete the improvements. An irrevocable letter of credit from a financial institution licensed to do business in Arizona. The irrevocable letter of credit shall specify which improvements are included and shall: a. Be stipulated by and payable to a third party who is not the developer; b. Be accepted and signed by all parties; c. Include an expiration date not less than 90 days beyond the last improvement estimated completion date; d. State when and how the third party may draw on the funds; e. Be in an amount 10% greater than the estimated amount to complete all improvements; f. Include a registered engineer’s, architect’s, or contractor’s cost estimate to complete the improvements; g. State that repayment is the responsibility of the developer and not of the third party; and h. State that the irrevocable letter of credit is noncancelable. A loan commitment and agreement from a lender licensed in Arizona. The loan commitment and agreement shall specify which improvements are included and shall: a. Be stipulated by and payable to a third party who is not the developer; b. Be accepted and signed by all parties; c. Include an expiration date not less than 90 days beyond the last improvement estimated completion date; d. State when and how the third party may draw on the funds; e. Be in an amount 10% greater than the estimated amount to complete all improvements; f. Include a registered engineer’s, architect’s, or contractor’s cost estimate to complete the improvements; and g. State that repayment is the responsibility of the developer and not of the third party even if the third party draws on the funds. A trust or escrow account with a financial institution or escrow company licensed in Arizona. The trust or escrow account shall specify which improvements are included and shall: a. Be stipulated by and payable to a third party who is not the developer; b. Be accepted and signed by all parties; c. Include an expiration date not less than 90 Days beyond the last improvement estimated completion date; d. State when and how the third party may draw on the funds; e. Be in an amount 10% greater than the estimated amount to complete all improvements; f. Include a registered engineer’s, architect’s, or contractor’s cost estimate to complete the improvements; and g. Directly pay for the improvements completed or release funds to the developer upon written verification from a registered engineer that the improvements have been completed in accordance with the plan. City and county trust agreement. A municipal or county government may enter into an assurance agreement with a trustee to hold a lot conveyance until improvements are completed: a. The trustee is an escrow company licensed in Arizona, and b. The agreement is recorded. Written escrow agreement. A developer may enter into a written escrow agreement with a title insurance company or escrow company to escrow all funds and prohibit close of escrow until all improvements are complete. The agreement shall contain the following stipulations: a. The funds are not released nor the purchaser’s deed or other relevant documents recorded until the developer’s architect or engineer certifies to the Department and the escrow agent that the project is complete, ready for occupancy, and in compliance with all city and county requirements; b. If the completion date is not met: i. The developer will give purchasers notice that completion dates were not met and an updated completion schedule, ii. A purchaser may, within 30 days of receiving the notice specified in subsection (B)(6)(b)(i), cancel and receive a full refund by sending written notice to the escrow agent, iii. The public report is invalid and all sales are suspended; and iv. The Department considers the public report valid if improvements are completed at a later date and the public report is complete and accurate. Subdivision assurances. The municipal or county government shall prohibit occupancy and an subdivider shall not close escrow on lots sold in a subdivision until all proposed or promised subdivision improvements are complete. R4-28-A1212 TITLE 4. PROFESSIONS AND OCCUPATIONS 124 a. The subdivider shall submit an agreement or copy of the ordinance from the city or county prohibiting occupancy until all proposed or promised subdivision improvements are complete. b. If improvements are completed in phases, the subdivider shall submit complete details of the phasing program, including approval of the phasing by the city or county and the completion schedule for the phases to the Department. c. The subdivider shall submit a written statement that no escrow will close on any lot until all subdivision improvements are complete. If a lot is within a phase of the subdivision where all improvements are complete and can be used and maintained separately from the improvements required for the entire subdivision the escrow may be closed. d. The subdivider shall submit a copy of the subdivider’s purchase contract containing in large or bold print the condition that escrow will not close until the city or county issues its occupancy clearance and all subdivision improvements are complete. e. Any improvement offered or promised to a purchaser that is scheduled for completion in a later phase of completion shall have its completion assured by an alternative method of assurance listed in this Section. f. If the subdivider’s sales include unimproved (vacant) lots, the subdivider shall deposit all earnest money into a neutral escrow depository until escrow closes. 8. Any other assurance satisfactory to the Department that is not listed in subsections (B)(1) through (B)(7). C. If the construction of any improvement is completed in phases, the applicant shall provide a description of the phased schedule of completion, including the lots in each phase and estimated completion dates. Historical Note Section R4-28-A1211 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). R4-28-A1212. Schools and Services A. The applicant shall include the following information about schools: 1. The location of and distance to the nearest public elementary, junior, and high schools and whether school bus or other transportation is available; 2. The type and location of any other school located within a 1/2 mile radius of the exterior boundaries of the development. B. The applicant shall include the following information about services: 1. Community shopping. The location and distance from the development of the nearest community shopping area where food, drink, and medical supplies may be purchased; 2. Public transportation. The type, provider, location, and distance to the nearest access point to public transportation for the development; 3. Medical facility. The type, provider, location, and distance to the nearest medical facility; 4. Fire protection. Whether fire protection is available to the development, the name of the provider and the cost to the lot purchaser; 5. Ambulance service. Whether ambulance service is available to the development and whether the development is in a 911 service area. If 911 service is not available, the name, address, and telephone number of the ambulance service. 6. Police service. Whether police service is available to the development, and the name of the provider; 7. Refuse collection. Whether provisions have been made for refuse collection, the name of the service provider, and the cost to the lot purchaser. If no provisions have been made, what a buyer will do to dispose of refuse. Historical Note Section R4-28-A1212 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1213. Property Owners’ Association The applicant shall provide the following information about a property owner’s association: 1. The name of the association, if any; 2. The name of the master property owners’ association, if any; 3. The amount of the association assessment that property owners will be required to pay, and how it will be paid; 4. Whether the association is legally formed and operational; 5. When and under what conditions control of the association will be released to lot purchasers; 6. When and under what conditions title to the common areas will be transferred to the association; 7. Whether the common areas are subject to any lien or encumbrance. If yes, explain how purchasers’ use and enjoyment of common areas will be protected in the event of default; 125 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-A1216 8. Whether all lot owners will be required to be members of the association. If not, explain; 9. Whether nonmembers will be liable for payments to the association; and 10. A copy of the Articles of Incorporation and Bylaws in effect. Historical Note Section R4-28-A1213 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1214. Development Use The applicant shall provide the following information about development use: 1. Whether unimproved (vacant) lots or improved (with building) lots will be sold or leased; 2. The use for which development lots will be offered and an identification of the lots and their proposed use if more than one use is contemplated; 3. Whether the development or any lot is subject to adult occupancy or age restrictions; a. If yes, explain the restriction; b. If yes, explain whether this restriction is in compliance with the Federal Fair Housing Act. 4. Whether all or any portion of the development is located in an open range or area in which livestock may roam at large under the laws of this State and what provisions, if any, have been made for the fencing of the development to prevent livestock from roaming within the development and on a purchaser’s lot. If land is located in an open range or area in which livestock may roam at large, the purchase contract shall contain: a. Any provisions for the fencing of the development to prevent livestock from roaming within the development; and b. Any fencing requirements for the buyers to prevent livestock from roaming on their property. 5. Whether mineral rights are, or will be, reserved from the development lots and what the effect will be on lot owners if the minerals are extracted from the development; and 6. A full written disclosure of any condition or provision not specified in subsections (1) through (5) that may limit the use or occupancy of the property. Historical Note Section R4-28-A1214 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1215. Development Sales The applicant shall provide a description of the sales offering and: 1. A description of how sales or leases will be made and the manner by which title, right, or other interest is to be conveyed to the purchaser, including copies of sales and lease transaction documents; 2. Indicate whether cash sales are allowed and when the purchaser takes title; 3. Indicate where the purchaser’s deposit and earnest monies will be deposited and held; 4. If the deposit monies are available for use by the seller, when and under what conditions the monies will be refunded; 5. Indicate when the lot purchaser will be permitted to use and occupy the lot; 6. An explanation if the purchaser will not receive title free and clear of all liens; 7. The estimated average sales price for the lots; 8. Indicate whether any of the property will be leased, and if so; a. Provide a description of any provision for increase of rental payments during the term of the lease and any provisions in the lease prohibiting assignment or subletting, or both; b. Indicate whether the lease prohibits the lessee from mortgaging or otherwise encumbering the leasehold; and c. Indicate whether the lessee is permitted to remove an improvement when the lease expires. 9. The name, address, and telephone number of the Arizona broker who will be responsible for sales. If none, explain why; 10. The name and telephone number of the custodian of the development records and the physical location where the records will be kept; 11. Indicate whether the property has been or will be offered for sale before the date of the development application. If yes, explain; and 12. Indicate whether the sales documents contain all contract disclosures required by rule and statute. Historical Note Section R4-28-A1215 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-A1216. Title Reports and Encumbrances The applicant shall provide the following information concerning title reports and encumbrances: 1. Copies of any unrecorded liens or encumbrances against the property; R4-28-A1217 TITLE 4. PROFESSIONS AND OCCUPATIONS 126 2. A title report showing: a. An effective date not more than 30 days before Department receipt. The Department may request that the applicant update the title report so that it is not more than 30 days old when the public report is issued; b. A legal description based upon a recorded map, condominium or timeshare declaration. Metes and bounds legal descriptions shall be used only for membership camping application title reports; c. The applicant’s interest in the property; d. The name and telephone number of the person who prepared the title report; e. A requirement page, if applicable; and f. The following statement after the title exceptions: ‘‘There are no further matters of record affecting the land.’’ 3. Legible copies of all recorded and unrecorded documents reflected by the title report, or known to applicant, such as restrictions, easements, liens, encumbrances, trust agreements, options, and maps. Historical Note Section R4-28-A1216 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1217. ADEQ Approval The applicant shall obtain subdivision approval from ADEQ or its designee. Historical Note Section R4-28-A1217 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1218. Property Registrations in Other Jurisdictions The applicant shall provide a list of the jurisdictions where a property registration was filed with or accepted by another department of real estate or similar regulatory agency. Historical Note Section R4-28-A1218 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1219. Condominium Developments The applicant shall provide the following information about condominium developments: 1. A copy of the recorded condominium declaration, map, and amendments in effect, and 2. An opinion letter from an attorney licensed to practice in Arizona, stating that the condominium plat and declaration of condominium are in compliance with the requirements of A.R.S. §§ 33-1215 and 33-1219. Historical Note Section R4-28-A1219 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1220. Foreign Developments A. Unless exempt pursuant to A.R.S. § 32-2181.02, an applicant shall ensure that any development located outside the state that is advertised, promoted, or sold within the state complies with all Arizona laws and rules as if the land was located in the state. B. Any law or rule that is specific to Arizona may be waived by the Department, or the Department may request and accept the domicile state or country’s equivalent form of documentation. C. The applicant shall provide evidence that the domicile state or country has authorized the sale of lots and that the development is in compliance and good standing. If the domicile state or country issues a public report or equivalent, the application shall include the report. Historical Note Section R4-28-A1220 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1221. Cemetery Developments The applicant shall provide the following information about cemetery developments: 1. A statement that there are no liens on the cemetery property, 2. An accounting of the endowment care fund for an existing perpetual care cemetery, and 3. A financial statement of the applicant. Historical Note Section R4-28-A1221 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). 127 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-B1202 R4-28-A1222. Membership Camping Developments The applicant shall provide the following information about a membership camping development: 1. If the interest of the operator is evidenced by a lease, license, franchise, or a reciprocal agreement, a copy of the document and any amendments; 2. A description of any lakes or streams available for recreational use; and 3. A description of any exchange network and the responsibilities, obligations, and rights of the operator and purchaser, and copies of all exchange network documents. Historical Note Section R4-28-A1222 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-A1223. Affidavit The applicant shall sign an affidavit attesting that the information found in the application is true and correct. Historical Note Section R4-28-A1223 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). PART B. GENERAL INFORMATION R4-28-B1201. Expedited Registration For Improved Subdivision Lots and Unsubdivided Lands A. A developer may use the expedited public report registration by preparing the public report and submitting the appropriate application documents and fees established in A.R.S. §§ 32-2183(B) or 32-2195.03(B) to the Department. The Department shall assign a registration number to each application and verify the following: 1. The correct application form has been used and is two-hole punched at the top in standard placement. The application is placed on a two-prong AACO-type fastener in a file folder and delivered to the Department in an expanding file folder. Maps may be left off the fastener, folded, and placed in the expanding file. The application shall include: a. The Expedited Registration Request letter signed by the applicant; and b. The completed Department checklist for administrative completeness which indicates inclusion of the documents required by A.R.S. Title 32, Chapter 20, Article 4 and 4 A.A.C. 28, Article 12, Part A. 2. The filing fees have been included with the application; 3. All application questions have been answered; 4. The application signature page has been properly executed; 5. All required documents have been submitted; and 6. A complete and accurate public report in the Department’s published format on a computer diskette, formatted in a word processing program compatible with the Department’s current computer operating system and word processing software, has been submitted and all exhibits used for disclosure have been included on the diskette. (The developer may obtain a diskette containing the public report template from the Department upon request.) B. The Department may allow the applicant to correct a deficiency within the administrative completeness time-frame provided in A.R.S. §§ 32-2183(B) and 32-2195.03(B), in which case the overall 15 business day limitation is suspended until the applicant corrects the deficiency. Historical Note Section R4-28-B1201 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-B1202. Conditional Sales Exemption A. Any developer applying for a special order of exemption authorizing the offer for sale of a subdivision lot or unsubdivided land before issuance of a public report shall provide the following information to the Department: 1. The completed and executed Petition for Conditional Sales Exemption; 2. The completed and executed subdivision or unsubdivided land application for a public report; 3. The purchase contract containing all required contract disclosures and the Conditional Sales Addendum; 4. A current title report showing the ownership interest of the developer and acceptable condition of title; 5. A copy of the recorded development map, or if not recorded, a copy of the unrecorded map; 6. A copy of the Condominium Declaration, if applicable; 7. A Certificate of Assured Water Supply, or a letter from the ADWR or other evidence that the property is located in an area designated as having an assured water supply, if the property is located in a groundwater active management area; R4-28-B1203 TITLE 4. PROFESSIONS AND OCCUPATIONS 128 8. A water adequacy report from the ADWR or evidence that the property is located in an area designated as having an adequate water supply, if the property is located outside of a groundwater active management area; and 9. Any other information revealed necessary after preliminary review. B. The conditional sales exemption shall expire upon issuance or denial of the public report, or upon issuance of an order to summarily suspend sales, to cease and desist, or a voluntary suspension of sales by the developer or owner. Historical Note Section R4-28-B1202 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-B1203. Material Change; Public Report Amendments A. The developer shall notify the Department of all material changes in the information required by A.R.S. Title 32, Chapter 20, Articles 4, 7, 9, and 10, or 4 A.A.C. 28, Article 12, Part A. B. According to material changes reported in subsection (A), the Department may require the developer to amend the public report. C. Completion Date Extension. 1. A developer may apply to the Department for an amendment to a public report to extend the completion date of any improvement by providing an affidavit from the developer attesting that each purchaser, owner, and the city or county officials responsible for improvements were provided written notice of the completion status of the improvement, including a list of all people who were provided notice. 2. The Department may deny the application to extend the completion date beyond the first extension if a purchaser, owner, or city or county official opposes issuance of an amended public report to extend a completion date. 3. If an extension is denied, the developer shall provide the Department with a written agreement to suspend sales until the improvement is complete or the Department may issue a summary suspension order as provided in A.R.S. § 32-2157(B). D. To amend a public report, a developer shall submit payment of the applicable amendment fee and the following information: 1. The name and registration number of the development; 2. The name and signature of the developer; 3. A list of the changes to the development and sales offering or in the information previously provided to the Department; 4. Status of sales as prescribed in subsections (C) and (E); and 5. A purchase contract addendum, to be signed and dated by both seller and purchaser, acknowledging that the sale is conditioned upon issuance of the amended public report and purchaser’s receipt and acceptance of the amended public report. E. Suspension of sales. 1. If necessary for the protection of purchasers, the Department may suspend approval to sell or lease pending amendment of the report. 2. In lieu of issuing a suspension order under A.R.S. § 32-2157, the Department may accept a developer’s written agreement to suspend sales until the amended public report has been issued by the Department. F. If the Department determines that a suspension of sales is not necessary for the protection of purchasers and approves the proposed disclosure of the change, sales may continue if the prospective purchaser is provided a copy of the current public report and disclosure of all changes before signing a contract. Completion of sales is conditioned upon the developer obtaining and delivering to each purchaser under contract the amended public report. G. Upon obtaining the amended report, the developer shall provide a copy to prospective purchasers in place of the earlier public report and obtain a receipt for the amended public report. H. If an application to amend a public report is denied, the Department shall notify the developer in writing of the statutory basis for the denial and of the developer’s right to a fair hearing. Historical Note Section R4-28-B1203 renumbered from R4-28-1203 and amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). R4-28-B1204. Cemetery Notice; Amendments A change to information required pursuant to the provisions of Title 32, Chapter 20, Article 6, R4-28-301(A), or any other Section, requires amendment of the notice filed pursuant to A.R.S. 32-2194.01. Historical Note Section R4-28-B1204 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). 129 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-B1209 R4-28-B1205. Contiguous Parcels Except for lots in a platted subdivision, if two or more contiguous parcels of land are acquired by a single owner, the Department shall classify the lots as a single parcel for purposes of subdivision laws. Historical Note Section R4-28-B1205 renumbered from R4-28-1201 and amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-B1206. Filing with HUD If the subdivider requests that a subdivision public report be certified by the Department for filing with HUD, the subdivider shall comply with the terms, conditions, and requirements of the HUD certification agreement. Historical Note Section R4-28-B1206 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-B1207. Subsequent Owner A. Except as provided in A.R.S. § 32-2181.02, any developer who is a successor in interest to six or more lots within a subdivision on which the Department previously issued a public report shall file an application for and obtain a new public report before offering or selling any lot. B. Any developer who is a successor in interest to six or more parcels within an unsubdivided land development on which the Department previously issued a public report shall file an application for and obtain a new public report before offering or selling any parcel. C. Any developer who is a successor in interest to 12 or more time-share intervals within a time-share project on which the Department previously issued a public report shall file an application for and obtain a new public report, before offering or selling any interval. D. The Department shall not issue a new public report to a subsequent owner of a development if the previous developer failed to complete proposed improvements in accordance with estimated completion dates specified in the previously issued public report until one of the following occurs: 1. The subsequent owner makes financial arrangements, as described in R4-28-A1211, in favor of the local governmental authority and for the benefit of purchaser, securing the owner’s promise to complete the previously proposed improvements by a designated date; or 2. The subsequent owner becomes obligated to place all sales funds in a neutral escrow depository until the Department is furnished satisfactory evidence that all proposed improvements have been completed or accepted by the city or county; or 3. Permission is obtained by all previous purchasers in the development for completion of the proposed improvements by the new designated date for completion; or 4. The subsequent owner establishes to the satisfaction of the Department that adequate financial arrangements have been made to assure completion of the proposed improvements by the new designated date for completion. E. A developer who is a new owner of property that is the subject of a pending application for a public report shall not replace or be substituted for the applicant of the pending application. Historical Note Section R4-28-B1207 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 6 A.A.R. 1886, effective May 2, 2000 (Supp. 00-2). R4-28-B1208. Public Report Correction If the public report contains an error, the Department shall correct the report at its own expense. Additional or changed information that was known to the developer before issuance of the report is not an error. The Department shall not correct the public report after it has been in effect for 10 days. After 10 days, the developer shall change the report through the development amendment process, established in R4-28-B1203, with payment of the applicable amendment fee. Historical Note Section R4-28-B1208 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-B1209. Options; Blanket Encumbrances; Releases A. The Department shall not issue or amend a public report for any lot held under option or subject to a blanket encumbrance if a condition precedent to the optionee’s right to acquire the lot or to release from the blanket encumbrance shows that the lot shall: 1. Be acquired or released in a particular sequence, 2. Be acquired or released only after one or more additional lots have been acquired or released, or R4-28-B1210 TITLE 4. PROFESSIONS AND OCCUPATIONS 130 3. Not be released if the encumbrance is in default because of a cross-default provision contained in the encumbrance, B. The developer may require payment of a premium to permit the acquisition or release of the lot. C. When a blanket encumbrance clouds title to a development, the developer shall place a written statement from the holder of the blanket encumbrance in the public report application, quoting the provisions that enable a buyer to acquire title to a lot, free of the blanket encumbrance. Historical Note Section R4-28-B1209 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-B1210. Earnest Money The developer shall deposit earnest money and down payments in a neutral depository if: 1. The seller is in bankruptcy; 2. The sale is conditional pursuant to R4-28-B1202; or 3. The Department perceives a risk to the buyer. Historical Note Section R4-28-B1210 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-B1211. Recordkeeping If real property in a development is sold or leased by a developer without the services of a listing or selling broker, the developer shall keep all records as required by A.R.S. § 32-2151.01(A) and (C). Historical Note Section R4-28-B1211 adopted by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). ARTICLE 13. ADMINISTRATIVE PROCEDURES R4-28-1301. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Former Section R4-28-33 renumbered without change as Section R4-28-1301 (Supp. 87-1). Section R4-28-1301 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1302. Service of Pleadings Subsequent to Complaint and Notice A. Service of pleadings subsequent to complaint and notice of hearing shall be made by personal service or by mail to the last known address of record of the party or the party’s counsel. If service is made by mail, response time shall be increased by five days. Service by mail is complete upon mailing. B. Any person filing a pleading or brief with the Department shall also file with the Attorney General. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-34 renumbered without change as Section R4-28-1302 (Supp. 87-1). Section R4-28-1302 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1303. Information Obtained in an Investigation A. The Department shall ensure that information and documents in open audits and investigations remain confidential. Officers and employees of the Department shall not make confidential information or documents available to anyone other than the Attorney General or the Attorney General’s representative, or authorized employees of the Department, unless the Commissioner authorizes disclosure of the information or production of documents as being in the public interest. B. Upon request, the Department shall disclose the existence of and make available for review audit and investigative files that were closed within five years of the request for the information, subject to redaction of confidential or privileged information such as date of birth, social security number, bank and trust account numbers, home address and telephone number of active-status licensees, criminal history reports, attorney-client privileged communications, work product, and information regarding settlement negotiations. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-35 renumbered without change as Section R4-28-1303 (Supp. 87-1). Section R4-28-1303 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). 131 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-1309 R4-28-1304. Response; Default A. A response shall specifically admit, deny, or state that the party does not have, or is unable to obtain, sufficient information to admit or deny each allegation in the complaint. A statement of a lack of information shall have the effect of a denial. Any allegation not denied is deemed to be admitted. When a party intends in good faith to deny only a part of an allegation, the party shall admit so much of it as is true and shall deny the remainder. B. If the party fails to file a response or after being served notice, fails to appear at a hearing within the time provided by the statute under which the hearing is commenced, the Department may file an Affidavit of Default against the party, and proceed to take action against the party based upon the allegations of the charges. This action may be taken before the hearing date established in the Notice of Hearing. The party may file a motion to vacate the default and any action taken by the Commissioner within 15 days after receiving a copy of the default and the action or order by the Commissioner. For good cause, the Commissioner may vacate a default and any action taken and reschedule a hearing. C. Every response filed pursuant to this Section shall be signed by the filing party or by at least one attorney, in the attorney’s individual name, who represents the party, and shall be verified. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-36 renumbered without change as Section R4-28-1304 (Supp. 87-1). Amended subsection (D) effective November 27, 1987 (Supp. 87-4). Section R4-28-1304 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1305. Notice of Appearance of Counsel A. A party may participate in the party’s own behalf or be represented by a member of the State Bar of Arizona. B. Any person intending to appear at a contested case hearing or appealable agency action as counsel or representative of a party shall file a Notice of Appearance which shall advise the Department of the person’s intent to appear on behalf of a party. The notice shall be filed with the Office of Administrative Hearings and served on all parties and shall contain: 1. The title of the case, 2. The name of the agency ordering the hearing, 3. The current address and telephone number of the person appearing, and 4. The name of the party for whom the person is appearing. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-37 renumbered without change as Section R4-28-1305 (Supp. 87-1). Amended subsections (B) and (C) effective November 27, 1987 (Supp. 87-4). Section R4-28-1305 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1306. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-38 renumbered without change as Section R4-28-1306 (Supp. 87-1). Amended subsections (A), (B), and (C) effective November 27, 1987 (Supp. 87-4). Section R4-28-1306 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1307. Expired Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended subsection (E) effective March 13, 1981 (Supp. 81-2). Former Section R4-28-39 renumbered without change as Section R4-28-1307 (Supp. 87-1). Amended effective November 27, 1987 (Supp. 87-4). Section R4-28-1307 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Section expired under A.R.S. § 41-1056(E) at 10 A.A.R. 1893, effective February 29, 2004 (Supp. 04-2). R4-28-1308. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Former Section R4-28-40 renumbered without change as Section R4-28-1308 (Supp. 87-1). Amended effective November 27, 1987 (Supp. 87-4). Section R4-28-1308 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1309. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective June 23, 1983 (Supp. 83-3). Former Section R4-28-41 renumbered without change as Section R4-28-1309 (Supp. 87-1). Amended effective November 27, 1987 (Supp. 87-4). Section R4-28-1309 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1310 TITLE 4. PROFESSIONS AND OCCUPATIONS 132 R4-28-1310. Rehearing or Review of Decision; Response; Decision A. Unless otherwise provided by statute or rule, any party to a hearing before the Office of Administrative Hearings who is aggrieved by a decision rendered in a case may, pursuant to A.R.S. § 41-1092.09, file with the Commissioner a written motion for rehearing or review of the decision. The motion shall specify the particular grounds for rehearing or review. The moving party shall serve copies upon all other parties. A motion for rehearing or review under this Section may be amended at any time before the Commissioner rules upon the motion. B. A rehearing or review of the decision may be granted for any one of the following causes that materially affect the moving party’s rights: 1. Irregularity in the proceedings or any order or abuse of discretion by the administrative law judge that deprived a party of a fair hearing; 2. Misconduct by the Department, administrative law judge, or the prevailing party; 3. Accident or surprise that could not have been prevented by ordinary prudence; 4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing; 5. Excessive or insufficient penalties; 6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding; 7. That the findings of fact or decision is arbitrary, capricious, or an abuse of discretion; 8. That the findings of fact or decision is not supported by the evidence or is contrary to law. C. Presenting specific grounds for rehearing or review, affidavits and relief sought. 1. Each party filing a motion for rehearing or review shall specify in the motion which of the grounds listed in subsection (B) the motion is based upon and shall set forth specific facts and law in support of the rehearing or review. The party may cite relevant portions of testimony by reference to pages or lines of the reporter’s transcript of the hearing or to the date and time range of the Office of Administrative Hearings audio record, and may cite hearing exhibits by reference to the exhibit number. 2. When a party files a motion for rehearing or review based upon an affidavit, the person shall attach the affidavit to the motion before filing the motion unless leave for later filing of an affidavit is granted by the Commissioner. The leave may be granted ex parte. 3. Each party filing a motion for rehearing or review shall specify the specific relief sought by the motion, such as a different decision or penalty, a new hearing, a dismissal of the complaint, or other relief. A party may seek multiple forms of relief, in the alternative. D. Any party may file a written response to the motion. An affidavit may be attached to and filed with the response and shall not be later filed unless leave for later filing of affidavits is granted by the Commissioner. The original response shall be filed with the Department pursuant to R4-28-102, within 15 days after the date the motion for rehearing or review is filed, and a copy shall be served upon all other parties to the hearing. E. Within 30 days after a decision is rendered, the Commissioner may, on the Commissioner’s own initiative, order a rehearing or review of a decision for any reason for which a motion for rehearing or review might have been granted. The Commissioner shall specify the grounds for rehearing or review in the order. F. Upon review of a motion for rehearing or review of the decision, and any response, the Commissioner shall issue a ruling granting or denying the motion. If granted, the Commissioner may modify the decision or grant a rehearing. An order granting a rehearing shall specify with particularity the grounds on which the rehearing is granted, and the rehearing shall cover only those matters specified. All parties to the hearing may participate as parties at any rehearing. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective March 13, 1981 (Supp. 81-2). Amended effective June 23, 1983 (Supp. 83-3). Former Section R4-28-42 renumbered without change as Section R4-28-1310 (Supp. 87-1). Amended subsections (B), (C), and (D) effective November 27, 1987 (Supp. 87-4). Section R4-28-1310 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 11 A.A.R. 506, effective March 5, 2005 (Supp. 05-1). R4-28-1311. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended effective June 23, 1983 (Supp. 83-3). Former Section R4-28-43 renumbered without change as Section R4-28-1311 (Supp. 87-1). Amended subsections (A), (B), and (C) effective November 27, 1987 (Supp. 87-4). Section R4-28-1311 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). R4-28-1312. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Amended subsection (B) effective March 13, 1981 (Supp. 81-2). Amended effective June 23, 1983 (Supp. 83-3). Former Section R4-28-44 renumbered without change as Section R4-28-1312 (Supp. 87-1). Section R4-28-1312 repealed by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). 133 CHAPTER 28. STATE REAL ESTATE DEPARTMENT R4-28-1401 R4-28-1313. Correction of Clerical Mistakes Clerical mistakes in opinions, orders, rulings, any process issued by the Department, or other parts of the record, and errors arising from oversight or omission, may be corrected by the administrative law judge before transmission of the Department hearing file to the Commissioner, or by the Commissioner after transmission of the file, either upon the initiative of the administrative law judge or Commissioner, or upon motion of any party. Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-45 renumbered without change as Section R4-28-1313 (Supp. 87-1). Amended effective November 27, 1987 (Supp. 87-4). Section R4-28-1313 amended by final rulemaking at 5 A.A.R. 650, effective February 3, 1999 (Supp. 99-1). ARTICLE 14. REPEALED R4-28-1401. Repealed Historical Note Adopted effective May 1, 1980 (Supp. 80-3). Former Section R4-28-46 renumbered without change as Section R4-28-1401 (Supp. 87-1). Repealed effective November 27, 1987 (Supp. 87-4). Appendix Arizona Department of Real Estate 2008 Directory of Substantive Policy Statements revised: 2/2008 No. 2008.06 rev Short Title: Preventing Mortgage Fraud through Disclosure Description: Procedure: Effective Date: June 18, 2008. No. 2008.05 rev Short Title: Continuing Education Requirements for Renewal of 4-Year License Description: Procedure: Effective Date: June 6, 2008. No. 2008.04 rev Short Title: Business Brokers; License Requirement Clarification Description: Procedure: Effective Date: April 4, 2008. No. 2008.03 rev Short Title: Acceptable Forms of Payment Description: Procedure: Effective Date: February 8, 2008. No. 2008.02 rev Short Title: Subsequent Owners/Subdivision Diclosure Reports (Public Reports) Description: Practice/Procedure: Effective Date: February 8, 2008; Revised November 5, 2008. No. 2008.01 rev Short Title: Pre-License Education Waiver Description: Procedure: Effective Date: February 8, 2008. No. 2007.18 rev Short Title: Real Estate Licensee Advertising Description: Clarifies the Commissioner’s Rules on advertising to reduce unsubstantiated complaints and the backlog of investigations from such complaints regarding telephone and address requirements for advertising by a licensee. Effective Date: February 1, 2007; Revised 2/12/2007. No. 2007.17 Short Title: Electronic License Certificate Complies with Statutory Requirement Description: The Department of Real Estate will deem a printout of data contained in the ADRE Public Database, or an electronic file of such data that can be recreated electronically or on paper upon request, to be a license certificate. Effective Date: February 1, 2007. No. 2006.16 rev Repealed. No. 2005.15 Short Title: Broker Home Office Description: Describes the circumstances when the Department will not require compliance with the signage requirement. Effective Date: December 28, 2005. 135 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2005.14 Short Title: Fair Housing Course Substitute Description: Description of Practice/Procedure: Effective Date: August 9, 2005; Revised Novemeber 5, 2008. No. 2005.13 Short Title: Agent Responsibility to Client Description: Interprets the duties of a licensee set out in revised Commissioners Rules. Effective Date: Revised 6/1/2001, Revised & Renumbered 5/28/04, Revised & Renumbered 4/8/05. 136 No. 2005.12 Short Title: Continuing Education, Residential Resale Purchase Contract Description: Interprets the requirement for ‘‘other education or experience’’ for a real estate instructor to be qualified to teach an class on the 2005 Arizona Association of Realtors Residential Resale Purchase Contract. Effective Date: April 1, 2005. No. 2005.11 Short Title: Subdivision Public Report Application Form, Changes Description: Frequency of changes to the Applications for Subdivision Public Report and provision for comment by stakeholders. Effective Date: April 1, 2005. No. 2005.10 Short Title: Electronic Signatures Description: Acceptance of a broker’s electronic signature on contracts and agreements. Effective Date: November 5, 2004, Renumbered 4/01/05. No. 2005.09 rev Short Title: Non-commercial Requests to Inspect Records and Fees for Copies Description: Availability of Department’s records and the estimated time for production. Effective Date: June 18, 1999, Revised & Renumbered May 28, 2004, Renumbered April 1, 2005, Revised August 21, 2006. No. 2005.08 Short Title: Payment of Commission after License Expiration or Transfer of Employment Description: Department’s position concerning payment of a commission to a licensee after the Licensee has changed employing brokers or the license has expired. Effective Date: June 18, 1999, Revised & Renumbered 5/28/04, Renumbered 4/1/05. No. 2005.07 Short Title: Department investigation of Cases Involving Civil Litigation Description: Investigation of complaints and pursuit of civil remedies. Effective Date: June 18, 1999, Revised & Renumbered 5/28/04, Renumbered 4/1/05. No. 2005.06 Short Title: Electronic Record Keeping Description: Conditions under which brokers may keep required records electronically. Effective Date: August 15, 2000, Revised & Renumbered 5/28/04, Renumbered 4/1/05. No. 2005.05 Short Title: Access to Arizona Real Estate Law Book on the World Wide Web Description: Unrestricted access to the Arizona Real Estate Law Book on the Department’s Web-Site meets the requirement of statute. Effective Date: December 6, 1999, Renumbered 5/28/04, Renumbered 4/1/05. No. 2005.04 Short Title: Unlicensed Assistants Description: Clarification of tasks that can be delegated to an unlicensed assistant. Effective Date: June 18, 1999, Revised & Renumbered 5/28/04, Renumbered 4/1/05. No. 2005.03 Short Title: Disclosure of Licensee’s Home Address Description: Circumstances under which a licensee’s home address must be disclosed. Effective Date: June 18, 1999, Revised & Renumbered 5/28/04, Renumbered 4/1/05. 137 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2008.05 No. 2005.02 Short Title: Attendance Requirements for Credit & Enforcement Description: Circumstances when a licensee is entitled to credit for a class. Effective Date: June 18, 1999, Revised & Renumbered 5/28/04, Renumbered 4/1/05. No. 2005.01 Short Title: Acceptable Forms of Payment Description: Methods of payment accepted by the Department. Effective Date: June 18, 1999, Revised & Renumbered 5/28/04, Revised & Renumbered 4/1/05. No. 2008.06 rev. Short Title: Preventing Mortgage Fraud through Disclosure This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: 1. This policy statement applies to real estate transactions with financing. 2. The Department considers a conviction under A.R.S. § 13-2320 to warrant disciplinary action under A.R.S. § 32-2153(B). The Department recommends that a licensee who provides a premium, credit, or rebate in a real estate transaction disclose the premium, credit, or rebate to all parties in the transaction, including the lender and third-party service providers, such as appraisers, in the purchase agreement and the HUD-1 statement (or other writing if no HUD-1 is required). 3. A licensee is in violation of Title 32 Chapter 20 and AAC Title 4 Chapter 28 if: a. The licensee gives a premium, credit or rebate or otherwise pays an individual and is convicted of A.R.S. § 13-2320 (Residential Mortgage Fraud). b. The licensee gives a credit, rebate, premium or otherwise pays an individual in violation of 12 U.S.C. § 2607 et seq. (RESPA’s prohibitions against kickbacks, fee splitting, and unearned fees), Fannie Mae, Freddie Mac, FHA, VA, other federal and state requirements. Authority: A.R.S. §§ 32-2151.01(A), 32-2153(A), 32-2155(A)(B), 32-2163, 32-2176, and R4-28-1101(B). A.R.S. § 32-2102 provides that the department of Real Estate, under the direction of the Real Estate Commissioner, shall administer Title 32 Chapter 20. Policy Program: Regulation Effective Date: 6-18-2008 No. 2008.06 No. 2008.05 rev. Short Title: Continuing Education Requirements for Renewal of 4-Year License This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: 1. An agent or broker (licensee) who has a four-year license must receive 24 hours of continuing education credit (CE) in the first 24 months of the license period and 24 hours of CE in the second 24 months of the license period in order to be eligible for renewal. Each 24 hours of CE must fulfill the requirements established by rule. 2. Prior to the end of each 24-month period, licensees shall provide the following information to the Department: No. 2008.05 a. The course name APPENDIX: SUBSTANTIVE POLICY STATEMENTS 138 b. The course number c. The date the course was completed 3. Licensees shall utilize the Department’s online license system to provide this information. 4. As a courtesy, if a licensee has not reported this information, the Department will send a 90-, 60-, and 30-day email notice to the licensee prior to the expiration of the first 24-month period and prior to the license expiration date. If the licensee has an employing broker, the employing broker will also receive the 90-, 60-, and 30-day email notice. If the licensee and/or employing broker do not have an email address in their online licensee ADRE account, the licensee and/or employing broker will not receive these courtesy notices. 5. If a licensee does not comply with and report the CE information via the online license system to the Department by the end of the first 24 months, the licensee (and the employing broker, if applicable) will receive notice that CE requirements are not met by the licensee and evidence of completion must be submitted as prescribed by the commissioner. A licensee is not eligible to renew if the licensee is not compliant with continuing education requirements. In addition, the Department may take disciplinary action against licensees for non-compliance with the continuing education requirements. 6. The Department will consider that an employing broker has provided reasonable supervision of a licensee who is not in compliance with the CE requirement if either of the following occur within 30 days after the licensee is out of compliance: a. The licensee attends the required CE and submits the required evidence of CE to the Department as prescribed by the commissioner; or b. The employing broker severs the licensee and reports the action to the Department. Authority: A.R.S. § 32-2130(A), A.R.S. § 32-2153, A.R.S. § 32-2160.01(A), R4-28-402 Policy Program: Licensing/Regulation Effective Date: 6-6-2008 No. 2008.05 No. 2008.04 rev. Short Title: Business Brokers; License Requirement Clarification This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: A Business Broker is a person who acts as an intermediary between sellers and buyers of businesses or business opportunities. A Business Broker must have a real estate license if either of the following apply: 1. The transaction directly involves the sale or lease of real property. 2. A real property sale or lease is part of, contingent on, or ancillary to the transaction. Authority: A.R.S. § 32-2101(47)(N) Policy Program: Licensure/Regulation Effective Date: 4-4-2008 No. 2008.04 No. 2008.03 rev. Short Title: Acceptable Forms of Payment This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional 139 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2008.01 requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: The Department will only accept payment for fees and for any other purposes when made by credit card, cash, check, or money order. Acceptable checks include pre-printed personal or business account checks or drafts, either in-state or out-of-state. Two-party checks, counter checks or any check not pre-printed with the name and address of the account holder, the name of the subject financial institution and the account number are considered unacceptable forms of payment. Payment of a civil penalty shall be by credit card, money order, certified check, cashier’s check or cash. If an individual or entity has an outstanding ‘‘bad check,’’ no further checks or payment of any other kind for any purpose will be accepted by the Department from that individual or entity until the outstanding check is redeemed, using a credit card, cashier’s check, money order, certified check or cash. The Department will accept one form of payment per transaction. Authority: A.R.S. §§ 32-2125.01, -2129, -2130, -2186, -2194.02, -2195.02, -2196, -2197.05 and -2198.09 authorize the Commissioner to assess fees and prescribe the amounts to be charged. A.R.S. § 35-142(l) authorizes state agency acceptance of credit card payments pursuant to § 35-515. Policy Program: Commissioner’s Office Effective Date: 2-8-2008 No. 2008.03 No. 2008.02 rev. Short Title: Subsequent Owners/Subdivision Disclosure Reports (Public Reports) This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: A subsequent owner of 6 or more lots located within an existing platted subdivision for which a Subdivision Disclosure Report was previously issued may qualify for a Special Order of Exemption from the requirement to obtain a new Subdivision Disclosure Report if: 1) The subsequent owner has satisfied all provisions and requirements of A.R.S. § 32-2181.02(B)(2), except for the requirement of § 32-2181.02(B)(2)(a) that the Subdivision Disclosure Report must have been issued within the past two years. 2) The subsequent owner demonstrates compliance with the assured water supply requirement described in A.R.S. § 32-2181(C). Authority: A.R.S. § 32-2181(B) and § 32-2181.01. A.R.S. § 32-2102 provides that the Department of Real Estate, under the direction of the Real Estate Commissioner, shall administer Title 32, Chapter 20. Policy Program: Developments (Subdivisions) Effective Date: 2-8-2008; Revised November 5, 2008. No. 2008.02 No. 2008.01 rev. Short Title: Pre-license Education Waiver This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional No. 2008.01 APPENDIX: SUBSTANTIVE POLICY STATEMENTS 140 requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: No waiver will be granted for the mandated ninety-classroom hours for real estate salesperson or broker pre-licensure curriculum. Authority: A.R.S. § 32-2124(B), (C), (J), (L), A.A.C. § R4-28-301 (B). A.R.S. § 32-2102 provides that the Department of Real Estate, under the direction of the Real Estate Commissioner, shall administer Title 32, Chapter 20. Policy Program: Education/Regulation Effective Date: 2-8-2008 No. 2008.01 No. 2007.18 rev. Short Title: Real Estate Licensee Advertising This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: To reduce unsubstantiated complaints and the backlog of investigations from such complaints regarding telephone and address requirements for advertising by a licensee, the following clarifies the Commissioner’s Rules on advertising. There is no statute or rule that states which telephone number (employing broker’s or licensee’s) or address must appear in an advertisement. R4-28-502 (E) requires that the (legal or dba) name of the EMPLOYING BROKER (the corporation, partnership, limited liability company or sole proprietor) appears in all advertising in ‘‘a clear and prominent manner.’’ R4-28-502 also addresses other requirements for advertising not addressed in this Substantive Policy Statement. Authority: A.R.S. § 32-2102 provides that the Department of Real Estate, under the direction of the Real Estate Commissioner, shall administer Title 32, Chapter 20. A.R.S. § 32-2153(A)(3) provides that violation of the Commissioner’s Rules is subject to disciplinary action. Policy Program: Regulation Effective Date: Revised, effective 2-12-2007 No. 2007.17 Short Title: Electronic License Certificate Complies with Statutory Requirement This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: The Department of Real Estate will deem a printout of data contained in the ADRE Public Database, or an electronic file of such data that can be recreated electronically or on paper upon request, to be a license 141 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2005.14 certificate. This will increase efficiencies and enhance the timelines of issuing license certificates to real estate, cemetery and membership camping salespersons and brokers. A broker may comply with the statutory requirement that the broker retain and have the certificates available for inspection by accessing the licensed employee’s record in the Public Database at www.azre.gov and printing a copy showing current and active licensure to the employing broker or having this data available electronically. Employing broker and designated broker license certificates must still be displayed. An acceptable form is a printout of data contained in the ADRE Public Database. Authority: A.R.S. § 32-2102 provides that the Department of Real Estate, under the direction of the Real Estate Commissioner, shall administer Title 32, Chapter 20. A.R.S. § 32-2128 requires designated brokers and, where applicable, employing brokers, to prominently display their licenses in the office of the broker. Designated brokers are also required to have the licenses of salespersons and associate brokers licensed to the broker available and retained by the broker until or unless the license is returned to the Department due to license expiration, sever of employment, cancellation, suspension, termination or a change of employment information. A.A.C. R4-28-303. A.R.S. § 32-2151.01 requires the employing broker to maintain in the broker’s files a copy of employment status for all current and former employees for a period of at least 5 years from the date of the termination of employment. Policy Program: Licensure/Regulation Effective Date: Feb 1, 2007 No. 2006.16 rev. REPEALED No. 2005.15 Short Title: Broker Home Office This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: This policy is to describe the circumstances when the Department will not require compliance with the signage requirement. Some brokers retain their licenses on active status but do little or no real estate related activity and do not maintain an office outside their home. A.R.S. § 32-2126(B) provides, in part, that ‘‘Each designated broker and, if applicable, each employing broker shall cause a sign to be affixed at the entrance to the broker’s place of business, in a place and position clearly visible to all entering the place of business, with the name of the broker, the name under which the broker is doing business if other than the broker’s given name, . . .’’ The Department will not consider a broker to be in violation of the signage requirement under the provisions of A.R.S. § 32-2126(B) when the broker: • maintains a home office in the broker’s PRIMARY RESIDENCE, • handles FEWER THAN 3 transactions a year (0, 1, or 2), and • has no real estate related employees (licensed or unlicensed) The broker shall clearly and obviously display the broker’s real estate license in the home office, and comply with all other applicable statutory and rule requirements to hold a broker’s license. Authority: A.R.S. § 32-2102 provides that the Department of Real Estate, under the direction of the Real Estate Commissioner, shall administer Title 32, Chapter 20, Ariz. Rev. Stat. Policy Program: Licensing/Enforcement/Auditing Effective Date: December 28, 2005 No. 2005.14 Short Title: Fair Housing Course Substitute This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional No. 2005.13 APPENDIX: SUBSTANTIVE POLICY STATEMENTS 142 requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: Fair Housing Issues is a mandatory category for real estate license renewal: Real estate licensees must take a minimum of three credit hours in the six mandatory categories, and a total of twenty-four credit hours of Department-approved courses to apply for renewal of their real estate licenses. Some licensees engage exclusively in specialties in which Fair Housing is not an issue, for instance, farm and ranch sales, business brokerage and commercial sales/leasing. These licensees who deal exclusively in real estate specialty areas have requested an accommodation to allow them to substitute a class applicable to their area of specialization instead of taking a course in Fair Housing. 1. A real estate renewal applicant who is engaged in a specialty that does not include residential transactions may substitute an additional class that has been approved for a minimum of three credit hours in place of the mandatory Fair Housing course when all of the following apply: a. The licensee’s business is exclusively in a specialty field in which the fair housing law does not apply; b. The licensee provides proof (or has previously provided proof) of attendance at a Department-approved fair housing course in the past; c. The substitute course proposed is relevant to the licensee’s real estate activities. 2. To request the course substitution, the licensee shall submit an email to [email protected] prior to initiating the license renewal application process that specifically states the licensee’s compliance with the criteria listed in 1 above. 2. The Education Division will approve or deny the requested replacement class and inform the licensee of the decision. If approved the licensee may proceed with the renewal process using the substitute course. Authority: A.R.S. § 32-2130(A), A.R.S. § 32-2130; A.A.C. R4-28-402 (A)(5), A.A.C. R4-28-402(B). Policy Program: Education Effective Date: August 9, 2005; Revised November 5, 2008 No. 2005.13 Short Title: Agent Responsibility to Client This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: A licensee is a real estate professional with a fiduciary duty to his or her client to act in the client’s best interests as described in R4-28-1101(I). Reasonable care or competence may include recommending that a client seek professional or technical advice when the matter is beyond the expertise of the agent. Licensees are expected to take reasonable steps to assist their clients in confirming or verifying information under circumstances in which a reasonably prudent real estate professional has reason to question the accuracy of the information being provided in a transaction, or where the client has questioned the accuracy of the information. These considerations are intended to provide a reasonable standard for licensees to follow in complying with their duties and obligations under statute and rule. Authority: Commissioner’s Rule R4-28-1101 describes a licensee’s ‘‘professional duties’’ and A.R.S. § 322153(A)(3) and (22) identify violation of rules and negligence as grounds for disciplinary action against a licensee. Policy Program: Enforcement Effective Date: Revised 6/1/2001; revised and renumbered 5/28/04, revised and renumbered 4/8/2005. 143 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2005.11 No. 2005.12 Short Title: Continuing Education and the Residential Resale Purchase Contract This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: Course Approval: A school seeking approval of a Continuing Education Course in the Contract Law Category in which the majority of the material relates to the creation, fulfillment, and use of the 2005 Arizona Association of REALTORS (AAR) Residential Resale Purchase Contract must apply for a Certificate of Course Approval at least thirty days prior to holding the course. Schools must include a copy of the certification given to an instructor as documentation that the instructor has complied with the Instructor Approval requirements delineated below. Additionally, the provisions of the rules regarding course criteria content and approvals apply. Instructor Approval: An instructor seeking approval to teach a Continuing Education Course in the Contract Law Category in which the majority of the class material relates to the use of the revised 2005 AAR Residential Resale Purchase Contract shall have attended one of the AAR ‘‘Train-the-Trainer’’ Instructor Development Workshops (IDWs) or shall have attended a course taught by an instructor who had previously attended one of AAR’s ‘‘Train-the-Trainer’’ IDWs on the new 2005 Contract form. All other existing laws, regulations, and SPSs relating to instructors, waivers, and course approvals apply. Authority: The Department has the authority to approve or disapprove courses pursuant to A.R.S. 32-2135.A. and E., as well as pursuant to A.A.C. R4-28-404.B. Course content criteria are established in A.A.C. R4-28-402. The Department has the authority to set the criteria for instructor approval pursuant to A.R.S. 32-2135.E and A.A.C. R4-28-404.C.7. Program: Education Effective Date: April 1, 2005 — March 31, 2006 No. 2005.11 Short Title: Subdivision Public Report Application Form, Changes This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: The Application for Subdivision Public Report may be updated on a quarterly basis to insure proper and full disclosure to prospective purchasers. This is subject to public health, safety, and welfare issues which may result in an immediate change to the subdivision application form. A. Prior to publication of the updated application form, a draft will be provided to stakeholders for review. Stakeholders will be provided no less than ten (10) business days to provide comment to the Department. B. After receiving and reviewing stakeholder comments, the updated application form will be published and placed on the Department website for download by applicants. Authority: A.R.S. § 32-2181 provides the Commissioner authority to create and modify the application form for public report. Policy Program: Subdivisions. Effective Date: April 1, 2005. 2005.10 No. 2005.10 APPENDIX: SUBSTANTIVE POLICY STATEMENTS 144 Short Title: Electronic Signatures This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: A broker may use an electronic signature to indicate the broker’s approval of contracts and agreements as required by statute. The following elements or requirements must be met and will be the basis for any Broker Audit of that aspect of the broker’s practice: A. System must meet the criteria under A.R.S. § 44-7031: A signature is a secure electronic signature if, through the application of a security procedure, it can be demonstrated that the electronic signature at the time the signature was made was all of the following: 1. Unique to the person using it. 2. Capable of verification. 3. Under the sole control of the person using it. 4. Linked to the electronic record to which it relates in such a manner that if the record were changed the electronic signature would be invalidated. B. The brokerage must have and enforce a written internal policy regarding personal computer security and, at a minimum, require that any person with electronic signature authority and capability locks or signs off his/her computer every time they walk away from their computer. C. The brokerage must have a back-up system defined for when the computers are down for an extended period of time. (i.e. how and when contracts and agreements will be manually reviewed) D. The system must have the ability to create a secure history log of all activity for electronic signatures which can be reviewed by Department auditors and investigators. Authority: A.R.S. § 32-2151.01 identifies Arizona Licensed Broker requirements for record keeping. Subsection G requires the designated broker to review each listing agreement, purchase or lease agreement or similar instrument within 5 days of the date the parties executed the document, and to place the broker’s initials and date of review on the same page as the parties’ signatures. Commissioner’s Rule R4-28-1103 describes a broker’s professional duties and requirement for written policy manual. Policy Program: Enforcement/Auditing Effective Date: 11/5/2004; Renumbered 4/01/05. No. 2005.09 rev. Short Title: Non-commercial Requests to Inspect Department Records & Fees for Copies This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: Arizona’s public record statute, A.R.S. § 39-121, provides: ‘‘Public records and other matters in the office of any officer at all times during office hours shall be open to inspection by any person.’’ Contact the Custodian of Records, Arizona Department of Real Estate, 2910 N. 44th Street, Suite 110, Phoenix, AZ 85018, to request an appointment to review, or in writing to request copies of, any file of record at The Department. If the request is for numerous files or a requested file is stored off-site, additional time may be required. Fees charged to ADRE for retrieval will be passed on to the requesting party. The charge for photocopies of records is published in the ADRE Fee Schedule available on the ADRE web site: www.azre.gov, for non-commercial use, except in response to any Subpoena Duces Tecum. Fees for certification of copies, fees for employment histories, and other similar services are also published in that Schedule. The following sets out the minimum number of days typically required for files to be retrieved and any restricted information to be redacted: 145 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2005.08 3-5 day advance notice for: salesperson, broker, school, instructor or course file. 3-5 days advance notice for: audit inspection or hearing/disciplinary file. 5-7 days advance notice for: recovery fund files; public report files (for: subdivisions, time-shares, membership campgrounds, & unsubdivided land); cemetery applications; and closed investigative files. The Department will deny public inspection of a particular document if: 1) the document is made confidential by statute; 2) the document involves the privacy interests of persons; 3) disclosure would be detrimental to the best interests of the state; 4) it is correspondence between the Attorney General’s Office and the Department, or any other document, that contains information protected under attorney/client privilege; 5) it is criminal history record information; or 6) it is a written offer to settle or compromise, or is correspondence related to settlement of administrative actions by the Department; 7) it is an internal memorandum regarding regulated parties and case strategy; and 8) it is an instrument of the internal deliberative process. The Department will deny public inspection or reproduction of information and documents in open (active or pending) audits and investigations, unless the Commissioner authorizes disclosure of the information or production of documents as being in the public interest. Such open files remain confidential until the matter is final, a notice of hearing is issued, or the matter is settled by consent order. The following information shall be redacted: a licensee’s date of birth and Social Security Number; and in some circumstances, the residence address of a licensee. Authority: The authority to charge a fee for copying is at A.R.S § 39-121.03. Fees for copies required by a Subpoena Duces Tecum are set by Arizona Rules of Civil Procedure. The authority to withhold specific documents from the Department’s public record is cited for the following types of documents: correspondence between the Attorney General’s Office and the Department as well as advice given to the Department from the Attorney General’s Office pursuant to A.R.S. § 12-2234; criminal history record information pursuant to A.R.S. § 41-1740; written offers to settle or compromise administrative actions by the Department; all correspondence related to settlement negotiations pursuant to Rule 408, Arizona Rules of Evidence; and memoranda, both interoffice & intra-office, to the Commissioner, either directly or through the supervisory chain of command, of an advisory or consultative nature pursuant to the deliberative process privilege. The authority to keep confidential all information and documents in an open audit file or investigation file is found at A.A.C. R4-28-1303. The authority to redact certain data from the Department’s records before they are produced includes: dates of birth pursuant to Scottsdale Unified School District v. KPNX, 191 Ariz. 297, 955 P.2d 534 (1998); Social Security Numbers pursuant to 42 USC § 405 (c)(2)(C)(viii)(I). See S.P.S. 2005.03 relative to restricted release of home addresses. Policy Program: Administration; Administrative Actions; Education & Licensing; Investigations & Audits; Subdivision Compliance. Effective Date: 6/18/1999; Revised & Renumbered 5/28/04; Renumbered 4/01/2005; Revised 8/21/2006. No. 2005.08 Short Title: Payment of Commission to Salesperson After License Expiration or Transfer of Employment This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: When a real estate licensee has rightfully earned a commission while in the employ of a broker, and in accordance with their agreement, that broker shall pay the licensee, even though the licensee may have left the employ of that broker. The same finding applies to similar circumstances for an associate broker. Authority: A.R.S. § 32-2155 Policy Program: Enforcement Effective Date: 6/18/99; Revised & Renumbered 5/28/04; Renumbered 4/01/05. No. 2005.07 No. 2005.07 APPENDIX: SUBSTANTIVE POLICY STATEMENTS 146 Short Title: Department Investigation of Cases Involving Civil Litigation This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: A Complainant’s filing of a civil suit has no bearing on whether the Department will pursue an alleged violation of a statute or rule within the Department’s jurisdiction. The Department shall commit the appropriate resources to investigate possible violations. The Department monitors and regulates real estate licensees, but does not determine a licensee’s civil liability to third parties. A finding by the Department that a violation warranting administrative action did or did not occur, is not dispositive of liability and does not create any presumption regarding whether or not civil liability exists. The Department’s investigations shall not be utilized for the purpose of circumventing the Arizona Rules of Civil Procedure or as a means of discovery of evidence for use in civil litigation. The Department will not intentionally place itself in the position of providing discovery and building a prima facie case for a Complainant, only to have the Complainant use the Department’s investigative file as evidence in a civil suit. It is not the Department’s role to assist a Complainant to develop a case that will assist them pursuing damages. The Department shall not delay an investigation to await the outcome of a civil court proceeding. Such a delay may discourage or financially inhibit a Complainant’s pursuit of a civil cause of action. Such a delay might also encourage a licensee to assert the Department’s inaction as an argument in the licensee’s favor. Authority: The Department’s authority to investigate alleged or perceived violations of Arizona Revised Statutes Title 32, Chapter 20, and Title 4, Chapter 28 of the Arizona Administrative Code, is found at A.R.S. § 32-2108. Policy Program: Enforcement. Effective Date: 6/18/99; Revised & Renumbered 5/28/04; Renumbered 4/01/05. No. 2005.06 Short Title: Electronic Record Keeping This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: Licensees of the Department (brokers, property management companies and cemetery owners) are required to retain copies of transactions.1 Brokers and management companies are also required to keep employment records.2 Records pertaining to trust accounts, if kept electronically, must be able to be reconstructed ‘‘. . . in the event of destruction of electronic data.’’ A licensee may retain the required transaction and employment records by electronic means, providing that all of the following conditions are met: The records are maintained in a manner allowing reconstruction in the event of destruction of electronic data. The records can be produced, at the broker’s expense, in legible, written form (‘‘hard copy’’) upon request by the Commissioner, or the Commissioner’s representative, for auditing, inspection, or investigation purposes. The electronic records are exact duplicates of the original. The stored records are legible. Authority: Brokers are required to retain records pursuant to A.R.S. §§ 32-2151(B)(2), 32-2151.01(A), 32-2151.01(H), 32-2175(A), 32-2175(B) and 32-2194.06(A) and (B). A.R.S. § 32-2151(B)(2) requires that trust 147 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2005.04 account records that are maintained electronically be able to be reconstructed. A.R.S. § 32-2194.03(E) requires a cemetery owner or the owner’s agent to keep and maintain records of all sales transactions and monies received, and authorizes examination of the books and records of the cemetery owner or agent. A.R.S. §§ 32-2108(A), 32-2175(H) and 32-2194.06 (B) authorize the Commissioner to examine the books and records of any natural person or entity engaged in the business or acting in the capacity of a broker, salesperson or developer. Pursuant to A.R.S. § 32-2107, the Commissioner is authorized to administer the Department and the provisions under its jurisdiction. Policy Program: Licensing Effective Date: 8/15/2000; Revised & Renumbered 5/28/04; Renumbered 4/01/05. 1 Transaction records, referenced herein, include records of all real estate, cemetery, time-share and membership camping transactions handled by or through a broker, property management firm, or cemetery owner or agent, including contracts and addenda, earnest money receipts, closing statements showing all receipts, disbursements and adjustments, lease contracts, employment agreements (including property management, listing, and buyer-broker agreements), residential and nonresidential leasing or rental agreements. Employment records include forms evidencing hiring, severing (terminating), or license renewal of employed licensees. 2 No. 2005.05 Short Title: Access to Arizona Real Estate Law Book on the World Wide Web This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: A.R.S. § 32-2123(E) states, in part: ‘‘Each person licensed pursuant to this article, whether the license is active or inactive, shall have available for the licensee’s use a current copy of the department’s statutes, rules and annotations pertaining to real estate laws.’’ The Commissioner considers unrestricted access to the World Wide Web, and thus to the on-line edition of the Arizona Real Estate Law Book on the Department’s Web site at http://www.re.state.az.us, to satisfy the requirements of this statute. ‘‘Unrestricted access’’ is defined as access to the Department Web Site at any time without the permission or assistance of others. Authority: Pursuant to A.R.S. § 32-2107, the Commissioner has charge of the Department and authority to administer the laws and rules adopted pursuant to Arizona Revised Statutes, Title 32, Chapter 20. Policy Program: Education Effective Date: December 6, 1999; Renumbered 5/28/04; Renumbered 4/01/05. No. 2005.04 Short Title: Unlicensed Assistants This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: In looking at the issue of unlicensed assistants, various aspects must be considered, including what activities the individual will perform and how the individual is paid. If an unlicensed assistant is paid on any basis that relies on the ultimate sale of a property, then that person must be licensed. An unlicensed assistant in the employ of a licensed real estate broker may: Perform telephone duties, to include calls to: No. 2005.03 APPENDIX: SUBSTANTIVE POLICY STATEMENTS 148 1) collect demographic information 2) solicit interest in engaging the services of a licensee or brokerage 3) set or confirm appointments (with no other discussion) for: A licensee to list or show property A buyer with a loan officer A property inspector to inspect a home A repair/maintenance person to perform repairs/maintenance An appraiser to appraise property 4) mortgage and/or title companies to track the status of a file, check daily interest rates and points, whether buyer has been qualified, confirm closing appointment for licensee, and so forth Assist a licensee at an open house Unlock a home for a licensee so that licensee can show a buyer the property or preview the property (no discussion about the property) Deliver documents (as a mail or delivery service only) An unlicensed assistant shall not perform the following activities: Hold/host an open house without an agent being present Perform a walk-through inspection Answer questions relating to a transactional document Give instructions to inspectors, appraisers or maintenance/repair people. Because these instructions are part of the licensee’s regular duties and there is a direct relationship to the (potential) transaction, a license is required in order to give instructions to inspectors appraisers or repair/maintenance people Authority: A.R.S. § 32-2101(46) defines the activities of a real estate broker, for which licensure is required pursuant to A.R.S. § 32-2122. See also A.R.S. § 32-2121. Policy Program: Enforcement Effective Date: Revised April 3, 2000; Revised & Renumbered 5/28/04; Renumbered 4/01/05. No. 2005.03 Short Title: Disclosure of Licensee’s Home Address This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: Only the business addresses and telephone numbers of active-status licensees are disclosed to the public. Requests for the residential address and telephone number of an active status licensee shall be denied, except in the cases of those self-employed brokers whose business and residential addresses are the same. State law requires the Department to make available to the public the residential address and telephone number of an inactive licensee unless the inactive licensee provides the Department with a current and valid alternative mailing address and alternative telephone number. A licensee who has obtained an Order of Protection may provide the Department with a current and valid alternative mailing address and alternative telephone number. All licensees are required to provide and maintain their current residential address on file with the Department. All licensees are required to notify the Department within 10 days of any changes to their personal licensing data, including personal (residence) address. Authority: A.R.S. § 32-3801, adopted April 4, 1997, states that a licensee’s residential address and telephone number shall not be available unless that is the only address on file. At the Department, a business address is available when the license held is current and an employing broker employs the licensee. This law superseded the 1996 provision that authorizes the Commissioner to keep confidential a licensee’s home address and telephone number for good cause upon a request by the licensee. A.R.S. § 32-2123 requires an applicant to provide the applicant’s residential address. A.A.C. R4-28-301 (E) & R4-28-303 require the residential address be kept current. 149 APPENDIX: SUBSTANTIVE POLICY STATEMENTS No. 2005.01 Policy Program: Licensing Effective Date: Revised 12/6/01; Revised & Renumbered 5/28/04; Renumbered 4/01/05. No. 2005.02 Short Title: Attendance Requirements for Credit & Enforcement This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: A.R.S. § 32-2124(B) and (C) and § 32-2130(A) require licensees to attend a prescribed amount of time in pre-licensure and continuing education classes. Tardiness may preclude a student from receiving credit for the course. Commissioner’s Rule R4-28-101(3) defines ‘‘credit hour’’ as a fifty minute period of instruction, which allows students a 10-minute break for each sixty minutes and still receive an ‘‘hour’’ of credit for each 50 minutes spent under instruction. When a course sponsor schedules a class, the customary practice is to schedule just enough time to cover breaks and meet the ‘‘fifty-minutes-of-instruction’’ definition (standard) to award each approved credit hour. The course instructor and the real estate school providing the course are responsible for enforcing the above standard. Authority: The authority to approve or disapprove courses and course sponsors exists in A.R.S. § 32-2135 and Title 4, Chapter 28, Article 4 of the Arizona Administrative Code. Attendance is required in order for Department-approved credit is issued pursuant to A.R.S. §§ 32-2124 (B) and (C), 32-2130 and A.A.C. R4-28-101. Policy Program: Education Effective Date: June 18, 1999; Revised & Renumbered 5/28/04; Renumbered 4/01/05. No. 2005.01 Short Title: Acceptable Forms of Payment This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona Administrative Procedure Act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under ARS 41-1033 for a review of the statement. Description of Practice/Procedure: The Department will only accept payment for fees and for any other purposes when made by cash, check or money order, or by acceptable credit card for specified on-line transactions. Acceptable checks include pre-printed personal or business account checks or drafts, either in-state or out-of-state. The Department will not accept two-party checks, counter checks or any check not pre-printed with the name and address of the account holder, the name of the subject financial institution and the account number. Payment of a civil penalty shall be paid by money order, certified check, cashier’s check or cash.1 If an individual or entity has an outstanding ‘‘bad check,’’ no further checks or payment of any other kind for any purpose will be accepted by the Department from that individual or entity until the outstanding check is redeemed, including returned check costs, using a cashier’s check, money order, certified check or cash. On-Line transactions, including license renewals, hire or sever requests, and transfers of employment, may be paid using a Discover, Visa, MasterCard or American Express credit card at the conclusion of the on-line session, after the user has been automatically redirected to a secure website. Authority: A.R.S. §§ 32-2125.01, -2129, -2130, -2186, -2194.02, -2195.02, -2196, -2197.05 and -2198.09 authorize the Commissioner to assess fees and prescribe the amounts to be charged. A.R.S. § 35-142(I) authorizes state agency acceptance of credit card payments pursuant to § 35-315. No. 2005.01 APPENDIX: SUBSTANTIVE POLICY STATEMENTS 150 Policy Program: Business Office/Administration Effective Date: June 18, 1999; Renumbered 5/28/04; Revised and Renumbered 4/01/05. 1 Cash normally may be accepted only at the front counter, not through the mail; however, if cash is received by mail, it shall be accepted and receipted. The licensee assumes all risk for transmitting cash by mail. Index A ABANDONED CEMETERY PLOT, §32-2194.33. ACCESS TO LAND. Public report. Application. Information about, R4-28-A1207. Subdivisions. Permanent access, §32-2185.02. Unsubdivided lands. Permanent access required, §32-2195. ACCIDENT INCREASE POTENTIAL. Military airport and ancillary military facility. Disclosure for property located within territory in vicinity. Duty of commissioner to execute and record, §32-2113. ACCOUNTING. Property management. Final accounting. Termination of agreement, firm to provide, time, §32-2173. ACTING IN CONCERT. Defined, §32-2101. ACTIONS. Cemeteries. Advertising, §32-2194.05. Violations. Administrative penalties, recovery, §32-2194.08. Civil liabilities, §32-2194.09. Collection of compensation earned. Brokers or salespersons, §32-2152. Condominium recovery fund. Actions for judgments payable from fund. Statute of limitations, §32-2193.34. Membership camping. Contracts. Defenses and rights of action of purchasers retained, §32-2198.06. Remedies of purchasers, §32-2198.11. Public reports. Denial, suspension, or revocation, §32-2198.08. Real estate recovery fund, §§32-2186 to 32-2193.02. See REAL ESTATE RECOVERY FUND. Recovery of civil penalty assessed. Brokers or salespersons, §32-2160.01. ACTIONS —Cont’d Sale or lease of subdivided lands. Civil penalty, imposition, suspension or revocation of license. Limitation of action, §32-2185.09. Rescission of contract, §32-2183. Sale or lease of unsubdivided lands. Action to void transaction. Limitation of action, §32-2195.03. Unlawful sales or leases, §32-2195.06. Timeshares. Enjoining violations, §32-2197.14. Escrow or trust accounts. Disputed money, §32-2197.05. Fraudulent practices, §32-2197.19. Penalties, civil, §32-2197.20. Rescission, §32-2197.09. Violation of chapter. Complaint filed by commissioner, §32-2160. ADDRESS OF BROKER OR SALESPERSON LICENSEE. Confidentiality of home address. Signed statement requesting, §32-2125.03. ADMINISTRATIVE PENALTIES. Cemeteries, §32-2194.08. ADMINISTRATIVE PROCEDURES. Admissions. Allegations not denied admitted, R4-28-1304. Correction of clerical mistakes, R4-28-1313. Default. Failure to file response, R4-28-1304. Notice of appearance of counsel, R4-28-1305. Person filing pleading or brief with department. Filing with attorney general, R4-28-1303. Rehearing or review of decision, R4-28-1310. Responses, R4-28-1304. Service of pleadings subsequent to complaint and notice, R4-28-1302. ADMISSIONS. Administrative procedures. Allegations not denied admitted, R4-28-1304. ADULT OCCUPANCY RESTRICTIONS. Public report. Application requirement, R4-28-A1214. ADVERTISING. Advertising real estate defined, §32-2101. Cemeteries, §32-2194.05. Endowment-care fund. Deposit as prerequisite, §32-2194.26. Trust fund required, §32-2194.25. Communications media or representatives engaged in real estate activities. Inapplicability of licensing provision, §32-2121. Development, R4-28-504. False statements or publications. Criminal penalty, §32-2161. Job placement services. Real estate schools, R4-28-404. Licensed brokers or salespersons, R4-28-502. Membership camping. Contracts, §32-2198.10. Availability of campgrounds, §32-2198.14. Disclosure in public report applications, §32-2198.01. Public reports. Denial, suspension, or revocation. Grounds, §32-2198.08. Promotional activities, R4-28-503. Real estate schools, R4-28-502. Sale or lease of subdivided lands. Advertising material, filing with commissioner, prohibitions, §32-2183.01. Sale or lease of unsubdivided lands. Advertising material, §32-2195.05. Attachment to notice of intent, §32-2195. Timeshares. Approval of material by commissioner, §32-2197.17. Supervisory duties of developers, §32-2197.11. AFFILIATES. Membership camping operators. Public reports, applications, §32-2198.01. AGE REQUIREMENT. Broker or salesperson license, §32-2124. AGE RESTRICTIONS. Public report. Application, information required, R4-28-A1214. 151 INDEX AGRICULTURAL ACTIVITIES. Public report. Application. Description of activities in vicinity of development, R4-28-A1203. AIDS. Disclosures in real property transfers. Owner or occupier of property subject to transfer diagnosed as having. Failure to disclose not grounds for termination or rescission, §32-2156. AMBULANCE SERVICE. Public report. Application. Information about services, R4-28-A1212. APPEALS. Condominium recovery fund. Denial of claim, §32-2193.39. Final decision of commissioner, §32-2159. Real estate recovery fund. Denial of claim by commissioner, §32-2188.05. APPEARANCE OF COUNSEL. Notice. Administrative procedures, R4-28-1305. ARTICLES OF INCORPORATION. Membership camping club associations. Public reports, applications, §32-2198.01. ASSIGNMENT. Condominium recovery fund. Subrogation and assignment of rights, §32-2193.42. Membership camping contracts, §32-2198.06. Timeshares. Reservation of timeshare interests. Transfer of rights prohibited without seller’s consent, §32-2197.10. ATTORNEY GENERAL. Legal advisor and representative of commissioner, §32-2111. Person filing pleading or brief with department. Filing with attorney general, R4-28-1303. ATTORNEYS. Appearance of counsel. Notice. Administrative procedures, R4-28-1305. Exemption from broker or salesperson licensing provision, §32-2121. ATTORNEYS’ FEES. Cemeteries. Civil liabilities, §32-2194.09. ATTORNEYS’ FEES —Cont’d Cemeteries —Cont’d Voidable sales, §32-2194.03. Membership camping contracts. Purchasers’ remedies, §32-2198.11. Real estate recovery fund. Payment by fund, §32-2186. Sale or lease of subdivided lands. Action for violations, §32-2183.03. Action to rescind, §32-2183. Sale or lease of unsubdivided lands. Action to void transaction, §32-2195.03. Unlawful sales or leases, §32-2195.06. Timeshares. Actions for rescission of the sale or lease of timeshare interests, §32-2197.09. AUDITS. Membership camping operators. Lotteries and drawings. Requirements, §32-2198.10. Property management firms, §32-2175. AWARDS. Promoting sales or leasing as, R4-28-503. B BACKGROUND INFORMATION. Character of applicant for license. Information to establish, §32-2123. Criminal history record checks, §32-2108.01. BILLS OF SALE. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. BOARD. Real estate advisory board, §§32-2104, 32-2105. BOND. Cemetery brokers. Commissioner may require, §32-2193.02. Membership camping operators. Encumbrances or liens, §32-2198.14. Lotteries and drawings. Requirements, §32-2198.10. Public reports. Denial, suspension, or revocation, §32-2198.08. Public report. Application. Assurances for completion, R4-28-A1211. Real estate brokers. Commissioner may require, §32-2193.02. BOND —Cont’d Real estate recovery fund. Surety bond by licensee. Commissioner may require, §32-2193.02. Subdividers, surety bond, §32-2183.04. Timeshares. Escrow or trust accounts, alternatives, §32-2197.05. 152 BRANCH OFFICES MAINTAINED BY BROKER. Additional license for each office, §32-2127. Branch office manager, R4-28-304. Broker’s license fee or renewal, §32-2132. Information required by designated broker, R4-28-304. Managed by broker or licensed salesperson, §32-2127. Temporary office. Onsite sale of properties, R4-28-304. BROKER MANAGEMENT CLINICS, §32-2136. BROKERS AND SALESPERSONS. Act in consideration or expectation of compensation. Deemed person performing act of broker or salesperson, §32-2122. Action for collection of compensation earned, §32-2152. Address of licensee. Confidentiality of home address. Signed statement requesting, §32-2125.03. Advertising, R4-28-502. Promotional activities, R4-28-503. Associate broker. Defined, §32-2101. Branch offices maintained by broker. Additional license for each office, §32-2127. Branch office manager, R4-28-304. Broker’s license fee or renewal, §32-2132. Information required, R4-28-304. Managed by broker or licensed salesperson, §32-2127. Temporary office. Onsite sale of properties, R4-28-304. Broker defined, §32-2101. Broker management clinics, §32-2136. Business sales brokerage specialists. Continuing education requirement. Renewal of license, §32-2130. Instruction requirement, §32-2124, R4-28-405. 153 BROKERS AND SALESPERSONS —Cont’d Cash, checks or other items of value received. Licensees to place in care of designated broker, §32-2151.01. Cease and desist orders. Authority of commissioner to issue, hearing, §32-2154. Cemetery brokers. Generally. See CEMETERY BROKERS. Cemetery salespersons. Generally. See CEMETERY SALESPERSONS. Change of business location. Notice to commissioner, §32-2126. Cancellation of license, notice of change not given, §32-2126. Chronological log or other system. Real estate contracts and lease kept in, §32-2151.01. Civil penalties, §32-2160.01. Compensation. Collection of compensation earned. Action for, §32-2152. From more than one person. Accepting, R4-28-1101. Goods and services provided, R4-28-1101. Through licensed brokers only, §32-2155. Confidentiality. Licensee’s home address and home phone number. Signed statement by licensee requesting, §32-2125.03. Social security number of licensee, §32-2125.03. Consent orders. Authority of commissioner to grant, §32-2153.01. Continuing education requirement. Renewal of license, §32-2130, R4-28-402. Certificate of course attendance, filing, §32-2135. Distance learning courses, approval, R4-28-402. Waiver, R4-28-402. Copies of transaction statements. Duty of broker to retain, R4-28-802. Corporations. Licensed as broker or salesperson. Subject to provisions of chapter when acting as broker or salespersons, §32-2122. Criminal history records checks. License applicants, §32-2108.01. Delay in performing acts, R4-28-1101. Delivery of possession prior to closing, R4-28-1101. INDEX BROKERS AND SALESPERSONS —Cont’d Delivery of signed transaction document. Each party signing document, R4-28-802. Designated brokers. Cash, checks or other items of value received. Licensees to place in care of designated broker, §32-2151.01. Change, R4-28-302. Corporations, limited liability companies and partnerships. Designation required, §32-2125. Defined, §32-2101. Display of license, §32-2128. Licensing information required, R4-28-302. Responsibilities, R4-28-302. Review of listing agreements, purchase or nonresidential lease agreement, §32-2151.01. Sign at place of business, §32-2126. Supervision and control, duties, R4-28-1103. Temporary absence. Designation of licensee to act, §32-2127. Development inspection fee, R4-28-104. Discipline. Appeal of final decision, §32-2159. Authorized punishments, §32-2153. False statements or publications. Criminal penalty, suspension of license, §32-2161. Grounds, §32-2153. Service of process by commissioner, §32-2158. Summary suspension, §32-2157. Witnesses at hearing. Right of attendance of witnesses, §32-2158. Written notice of charges, §32-2157. Disclosures in real estate transactions. Information material and adversely affecting consideration, R4-28-1101. Property site of death, owned or occupied by person with AIDS or HIV, or in vicinity of sex offender. Failure to disclose not grounds for termination or rescission, §32-2156. Duties to client, R4-28-1101. Earnest money received. Type, statement in contract, agreement or receipt, §32-2151.01. Education requirements for licensure, R4-28-401. Continuing education requirement. Certificate of course attendance, filing, §32-2135. BROKERS AND SALESPERSONS —Cont’d Education requirements for licensure —Cont’d Continuing education requirement —Cont’d Renewal of license, §32-2130, R4-28-402. Distance learning courses, approval, R4-28-402. Waiver, R4-28-402. Real estate brokers or salespersons, §32-2124. Waiver of prelicensure courses, R4-28-401. Employing brokers. Administrative severance of licensee from, R4-28-303. Defined, §32-2101. Display of license, §32-2128. Expiration of license. Licenses of employees severed from broker, §32-2130. Inspection of records, §32-2151.01. Licensing information required, R4-28-302. Place of business. Definite place requirement, change of location, notice, failure to give, §32-2126. Sign, requirements, §32-2126. Real estate licensee. Cemetery and membership camping salespersons and associate brokers. Employment without being separately licensed, §32-2125.01. Number licensee allowed, categories, §32-2125.01. Records, §32-2151.01. Responsibilities, R4-28-302. Supervision and control, duties, R4-28-1103. Employment records. Employing brokers, requirements, §32-2151.01. Employment through licensed brokers only, §32-2155. Enjoining person from continuing violation. Authority of commissioner, §32-2154. Expeditious performance of acts, R4-28-1101. False statements or publications. Criminal penalty, suspension of license, §32-2161. Fee schedule, §32-2132. Fiduciary duty to client, R4-28-1101. Fingerprints. License applicants, §32-2108.01. Grounds for discipline, §32-2153. Inspection of records by commissioner. Records open for, §32-2151.01. INDEX BROKERS AND SALESPERSONS —Cont’d Internet web site. Offering of real estate brokerage services by. Activity requiring broker’s license, §32-2163. Letters of concern. Issuance, grounds, §32-2153. License fees. Payment, §32-2129. Schedule, §32-2132. Licensing, §§32-2121 to 32-2136. Administrative completeness review. Timeframe, R4-28-103. Administrative severance of license, R4-28-303. Age requirement, §32-2124. Applicability of article, §32-2122. Application for license, §32-2123. Additional information, request by department, time, R4-28-103. Completeness review, timeframe, R4-28-103. Incomplete application. Time for supplying information, R4-28-103. Renewal of license, §32-2130. Requirements, R4-28-301. Automatic cancellation of license. Change or abandonment of location without notice, §32-2126. Availability of certificates, §32-2128. Branch offices maintained by broker. Additional license for each office, §32-2127. Information required, R4-28-304. Temporary office. Onsite sale of properties, R4-28-304. Business brokerage. Continuing education requirement. Renewal of license, specialization in business sales, §32-2130. Instruction requirement. License applicant specializing in business sales, §32-2124, R4-28-405. Cancellation of license. Change or abandonment of location without notice, §32-2126. Reinstatement of license, §32-2131. Cemetery brokers. Article applicable to, §32-2122. Cemetery salespersons. Article applicable to, §32-2122. Certification questionnaire, R4-28-301. Changes. Information required, R4-28-303. BROKERS AND SALESPERSONS —Cont’d Licensing —Cont’d Character of applicant. Information commissioner may require to establish, §32-2123. Continuing education requirement. Certificate of course attendance, filing, §32-2135. Renewal of license, §32-2130, R4-28-402. Distance learning courses, approval, R4-28-402. Waiver, R4-28-402. Corporations, limited liability companies or partnerships, §32-2125. Information required, R4-28-302. Criminal background investigations of applicants, §32-2108.01. Definitions, §32-2101. Denial of license. Appeal of final decision, §32-2159. Grounds, §32-2153. Service of process by commissioner, §32-2158. Witnesses at hearing. Right of attendance of witnesses, §32-2158. Written notice of charges, §32-2157. Designating brokers. Information required, R4-28-302. Display of designated broker’s or employing broker’s license, §32-2128. Duplicates. Fee, §32-2132. Duration of license, §32-2129. Education requirements, R4-28-401. Continuing education requirement. Certificate of course attendance, filing, §32-2135. Renewal of license, §32-2130, R4-28-402. Distance learning courses, approval, R4-28-402. Waiver, R4-28-402. Real estate brokers or salespersons, §32-2124. Waiver of prelicensure courses, R4-28-401. Electronic submission of license application, §32-2123. Employing brokers. Administrative severance of license from, R4-28-303. Information required, R4-28-302. Examination, R4-28-403. Fee, §32-2132. Requirement, exemption, §32-2124. 154 BROKERS AND SALESPERSONS —Cont’d Licensing —Cont’d Examination —Cont’d Time period for license after passing, §32-2125.01. Exemptions from provisions, §32-2121. Timeshare telemarketers, §32-2197.17. Experience requirements. Original broker’s license, §32-2124. Expiration of license, §32-2130. Reinstatement of license, §32-2131. Fees, payment, §32-2129. Fees, schedule, §32-2132. Fingerprinting license applicants, §32-2108.01. Inactive status. Change to, information, R4-28-303. Inactive license defined, §32-2101. Renewal of license, §32-2130. Incomplete application. Time for supplying information, R4-28-103. Information required on application, §32-2123, R4-28-301. Issuance of license, §32-2125.01. License defined, §32-2101. Licensee defined, §32-2101. License period defined, §32-2101. License required, §32-2122. Membership camping brokers. Article applicable to, §32-2122. Generally. See MEMBERSHIP CAMPING BROKERS. Membership camping salespersons. Article applicable to, §32-2122. Generally. See MEMBERSHIP CAMPING SALESPERSONS. Multiple licenses, §32-2125.01. Name and place on license certificate, R4-28-301. Nonresidents. Course specific to state’s statutes, rules and regulations. Completion required, §32-2125.02. Foreign entity applying for license. Information required, R4-28-302. Service of process on, §32-2125.02. Appointment of commissioner as agent or attorney in fact for acceptance, §32-2125.02. 155 BROKERS AND SALESPERSONS —Cont’d Licensing —Cont’d Possession of salesperson’s or associate broker’s license. Employer to possess, §32-2128. Prisoners, parolees or persons under community supervision. License not issued to, §32-2124. Renewal of license prohibited, §32-2130. Provisional license. Issuance, grounds, §32-2153. Qualifications of applicant for license, §32-2124. Real estate brokers. Article applicable to, §32-2122. Real estate salespersons. Article applicable to, §32-2122. Reinstatement of license, §32-2131. Fee, §32-2132. Information required, R4-28-303. Renewal of license, §32-2130. Course requirement, real estate brokers and salespersons, §32-2124. Duration of license, §32-2129. Fee, §32-2132. Information required, R4-28-303. Timeframe for department action, R4-28-103. Requirements generally, R4-28-301. Self-employed brokers. Information required, R4-28-302. Severance from employing broker. Required for issuing broker’s license to salesperson, R4-28-301. Substantive review timeframes, R4-28-103. Summary suspension, §32-2157. Suspension or revocation. Appeal of final decision, §32-2159. False statements or publications, §32-2161. Grounds, §32-2153. Reinstatement of license, §32-2131. Service of process by commissioner, §32-2158. Summary suspension, §32-2157. Witnesses at hearing. Right of attendance of witnesses, §32-2158. Written notice of charges, §32-2157. Temporary license. Broker’s license, §32-2133. Cemetery salesperson’s license, §32-2134. Fees, §32-2132. Information required, R4-28-305. Termination of license. License expired for more than one year, §32-2130. INDEX BROKERS AND SALESPERSONS —Cont’d Licensing —Cont’d Termination of license —Cont’d Reinstatement of license, §32-2131. Timeframes for issuing or denying, R4-28-103. Time period for getting license after examination, §32-2125.01. Unlawful license activity, R4-28-306. Winding up existing or pending business. Temporary broker’s license, §32-2133. Membership camping brokers. Generally. See MEMBERSHIP CAMPING BROKERS. Membership camping salespersons. Generally. See MEMBERSHIP CAMPING SALESPERSONS. Negotiations, conducting, R4-28-1102. Nonresidents. Cooperation with out-of-state brokers. Brokers licensed in state, §32-2163. Course specific to state’s statutes, rules and regulations. Completion required by license applicants, §32-2125.02. Employment or compensation, §32-2125.02. Foreign entity applying for license. Information required, R4-28-302. Payment to and receipt of compensation from out-of-state brokers, §32-2163. Records. Maintained in state, address records kept, notice to commissioner, §32-2125.02. Trusts account, R4-28-302. Service of process on, §32-2125.02. Appointment of commissioner as agent or attorney in fact for acceptance, §32-2125.02. Signs placed on property by out-of-state brokers. Prohibition, §32-2163. Unlicensed out-of-state brokers listing, marketing or advertising real estate. Prohibition, §32-2163. Offers to purchase or lease property. Submission of all offers during listing period and prior to closing, R4-28-802. Pending business. Temporary broker’s license, §32-2133. BROKERS AND SALESPERSONS —Cont’d Place of business. Change of business location. Notice to commissioner, §32-2126. Cancellation of license, notice of change not given, §32-2126. Employing broker to maintain, §32-2126. Sign at place of business. Requirements, removal upon removal of business, §32-2126. Pocket card identification issued to licensee. Return. Cancellation, termination, suspension or revocation of licensee, §32-2128. Prisoners. Performing acts requiring license while incarcerated. Criminal penalty, §32-2166. Promotional activities. Advertising, R4-28-503. Property management generally. Rental property, §§32-2171 to 32-2176. See PROPERTY MANAGEMENT. Provisional license. Issuance, grounds, §32-2153. Real estate brokers. Generally. See REAL ESTATE BROKERS. Real estate recovery fund, §§32-2186 to 32-2193.02. See REAL ESTATE RECOVERY FUND. Real estate salespersons. Generally. See REAL ESTATE SALESPERSONS. Reasonable care, duty of, R4-28-1101. Records. Employing brokers, §32-2151.01. Real estate brokers, §32-2151. Rejected offers to purchase real property. Evidence of, retention, time period, §32-2151.01. Rental property. Property management generally, §§32-2171 to 32-2176. See PROPERTY MANAGEMENT. Representing more than one person, R4-28-1101. Restitution. Ordering person to make. Authority of commissioner, §32-2154. Review of listing agreements, purchase or nonresidential lease agreement. Designated brokers, §32-2151.01. INDEX BROKERS AND SALESPERSONS —Cont’d Risks of pre-possession and post-possession of property. Recommendation that client seek counsel, R4-28-1101. Salesperson defined, §32-2101. Sales transaction folders. Content requirements, §32-2151.01. Sign at place of business. Affixed to place of business, requirements, removal upon removal of business, §32-2126. Social security number. Confidentiality, §32-2125.03. Standards of practice and competence recognized in professional community. Services provided to conform to, R4-28-1101. Summary suspension of license, §32-2157. Supervision and control. Employing brokers or designated brokers, R4-28-1103. Telephone number of licensee. Confidentiality of home phone number. Signed statement requesting, §32-2125.03. Temporary absence of designated broker. Designation of licensee to act, §32-2127. Temporary license. Broker’s license, §32-2133. Fee, §32-2132. Information required, R4-28-305. Trade names. Advertising by brokers using, R4-28-502. Unlicensed persons. Criminal penalties. Performing acts or activities requiring license, §32-2165. Employment by licensed broker or payment of compensation. Unlawful, §§32-2155, 32-2163. Information required by. Persons conducting activities requiring license, R4-28-303. Winding up existing business. Temporary broker’s license, §32-2133. BUSINESS SALES BROKERAGE. Continuing education requirement. Renewal of license, specialization in business sales, §32-2130. Instruction requirement. License applicant specializing in business sales, §32-2124, R4-28-405. BYLAWS. Membership camping club associations. Public reports, applications, §32-2198.01. C CAMPGROUNDS. Membership camping generally, §§32-2198 to 32-2198.14. See MEMBERSHIP CAMPING. CANCELLATION. Brokers’ and salespersons’ licenses. Change or abandonment of location without notice, §32-2126. Reinstatement of license, §32-2131. Membership camping contracts, §32-2198.05. Timeshares. Pre-sales, §32-2197.02. Purchase agreements, §32-2197.03. Refunds, §32-2197.05. Reservations of timeshare interests, §32-2197.10. CD-ROM. Timeshares. Public reports. Format, §32-2197.08. Reservations of timeshare interests. Notice of intent to accept. Format, §32-2197.10. CEASE AND DESIST ORDERS. Real estate commissioner. Authority to issue, hearing, §32-2154. CEMETERIES. Abandoned cemetery plot, §32-2194.33. Advertising, §32-2194.05. Endowment-care fund. Deposit as prerequisite, §32-2194.26. Trust fund required, §32-2194.25. Amendment of notice. Change to required information, R4-28-B1204. Fees, §32-2194.10. Applicability of provisions. Crematories, §32-2194.31. Exceptions, §32-2194. Burial places. Opening and closing, §32-2194.32. Cemetery or cemetery property. Defined, §32-2101. Change to required information. Amendment of notice filed, R4-28-B1204. Contract disclosures and disclaimers, §32-2194.04. Declarations of dedication. Filing, §32-2194.22. Endowment-care fund. Deposits from sales, §32-2194.28. Funds, restrictions on use, §32-2194.30. Irrevocable trust fund. Contents and restrictions, §32-2194.27. 156 CEMETERIES —Cont’d Endowment-care fund —Cont’d Irrevocable trust fund —Cont’d Establishment and deposits required, §32-2194.26. Examination by commissioner, §32-2194.02. Fees. Deposit, §32-2194.13. Development inspection fee, R4-28-104. Examination, §32-2194.02. Modification of plans. Amendment of notice of intention to sell property, §32-2194.10. Investigations by commissioner, §32-2194.03. Jurisdiction of commissioner, §32-2194.15. Maps and plats, §32-2194.21. Filing, §32-2194.22. Modifications to plan after approval by commissioner, §32-2194.10. Notice of intention to sell property, §32-2194.01. Advertising consistent with, §32-2194.05. Amendment. Change to required information, R4-28-B1204. Fees, §32-2194.10. False statements, civil liability for, §32-2194.09. Penalties, administrative, §32-2194.08. Perpetual or endowed-care cemetery. Defined, §32-2101. Private cemetery. Defined, §32-2101. Inapplicability of provisions, §32-2194. Property owners. Abandoned cemetery plot, §32-2194.33. Address notification reclamation, §32-2194.33. Public report. Application for cemetery development, R4-28-A1221. Purchasers. Appearance and testimony before public bodies, §32-2194.01. Civil liabilities, limitation of actions, §32-2194.09. Voidable sales, §32-2194.03. Recordation of commissioner’s actions, §32-2194.07. Records, §32-2194.06. Sales and money received, §32-2194.03. Rule against perpetuities. Inapplicability, §32-2194.23. Rulemaking authority, §32-2194.20. Sale of cemetery lots. Certificate of authority required, §32-2194.03. 157 CEMETERIES —Cont’d Sale of cemetery lots —Cont’d Clear title, delivery, §32-2194.11. Contract disclosures and disclaimers, §32-2194.04. Endowment-care fund. Deposits of proceeds, §32-2194.28. Irrevocable trust fund, establishment as prerequisite to sales, §32-2194.26. Notice of intention to sell, §32-2194.01. Permanent access required, §32-2194.12. Records, §32-2194.03. Speculation, §32-2162. Suspension, commissioner’s order. Appeal of final decision, §32-2159. Service of process by commissioner, §32-2158. Summary suspension of sales, §32-2157. Witnesses at hearing. Right of attendance of witnesses, §32-2158. Written notice of charges, §32-2157. Undeveloped cemetery property, §32-2194.16. Voidable sales, §32-2194.03. Signs, posting, §32-2194.29. Speculation. Sales of property for, §32-2162. Survey of property, §32-2194.21. Transaction of business, authorization. Applications, §32-2194.18. Investigation of applicants, §32-2194.19. Certificate of authority. Issuance or denial, §32-2194.03. Trust fund required, §32-2194.24. Corporations permitted, §32-2194.17. Trust funds. Advertising. Prerequisites, §32-2194.25. Certificate of authority. Prerequisites, §32-2194.24. Violations. Administrative penalties, §32-2194.08. Civil liabilities, §32-2194.09. CEMETERY BROKERS. Bond. Commissioner may require, §32-2193.02. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Cemeteries generally. See CEMETERIES. Continuing education requirement. Renewal of license. Exemption, §32-2130. INDEX CEMETERY BROKERS —Cont’d Defined, §32-2101. Discipline generally. See BROKERS AND SALESPERSONS. Disclosures, §32-2194.14. Licensing. Brokers and salespersons generally. Statutes and regulations. See BROKERS AND SALESPERSONS. Continuing education requirement. Renewal of license. Exemption, §32-2130. Examination, §32-2124. Experience requirement, §32-2124. Suspension or revocation. See BROKERS AND SALESPERSONS. Real estate recovery fund, §§32-2186 to 32-2193.02. See REAL ESTATE RECOVERY FUND. Records. Maintenance, §32-2194.06. Violations. Administrative penalties, §32-2194.08. Civil liabilities, §32-2194.09. CEMETERY SALESPERSONS. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Cemeteries generally. See CEMETERIES. Continuing education requirement. Renewal of license. Exemption, §32-2130. Defined, §32-2101. Discipline generally. See BROKERS AND SALESPERSONS. Licensing. Brokers and salespersons generally. Statutes and regulations. See BROKERS AND SALESPERSONS. Continuing education requirement. Renewal of license. Exemption, §32-2130. Examination, §32-2124. Suspension or revocation. See BROKERS AND SALESPERSONS. Temporary license, §32-2134. Fee, §32-2132. Information required, R4-28-305. Real estate recovery fund, §§32-2186 to 32-2193.02. See REAL ESTATE RECOVERY FUND. Temporary license, §32-2134. Fee, §32-2132. Information required, R4-28-305. CEMETERY SALESPERSONS —Cont’d Violations. Administrative penalties, §32-2194.08. Civil liabilities, §32-2194.09. CERTIFICATE OF AUTHORITY. Generally. See PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. CERTIFICATE OF CONVENIENCE. Membership camping salespersons, §32-2134.01. Fee, §32-2132. Information required, R4-28-305. CERTIFICATE OF COURSE ATTENDANCE. Continuing education requirement. Renewal of broker or salesperson license, §32-2135. CERTIFICATION OF REAL ESTATE SCHOOLS. Approval to operate, course approval, withdrawal or denial, §32-2135, R4-28-404. CERTIFIED COPIES OF DEPARTMENT RECORDS. Evidence, §32-2112. CHANGE OF PLACE OF BROKER’S BUSINESS LOCATION. Notice to commissioner, §32-2126. CHARITABLE NONPROFIT CORPORATIONS. Exemption from broker or salesperson licensing provisions. Commissioner granting, §32-2121. CITY TRUST AGREEMENT. Public report, certificate of authority or general order of exemption. Application. Assurances for completion, R4-28-A1211. CIVIL PENALTIES. Assessment, action to recover, §32-2160.01. Brokers and salespersons, §32-2160.01. Sale or lease of subdivided lands, §32-2185.09. Assessment, action to recover, §32-2160.01. Timeshares, §32-2197.20. CLINICS. Broker management clinics, §32-2136. CLOSING. Defined, R4-28-101. INDEX CLOSING —Cont’d Timeshares, §32-2197.03. Provision of information to purchasers beforehand, §32-2197.08. Supervisory duties of developers, §32-2197.11. COLLECTION OF COMPENSATION EARNED. Action for, brokers and salespersons, §32-2152. COMMISSIONER. See REAL ESTATE COMMISSIONER. COMMON INTEREST DEVELOPMENTS. Reservation or money. Persons soliciting, arranging or accepting for occupancies. Inapplicability of broker or salesperson licensing provisions, §32-2121. COMMON PROMOTIONAL PLAN. Defined, §32-2101. Presumption. Land offered for sale or lease as, §32-2101. COMMUNITY SUPERVISION, PERSONS ON. Broker or salesperson license. Not issued to, §32-2124. Renewal, prohibited, §32-2130. COMPLAINT FOR VIOLATION OF CHAPTER. Real estate commissioner. Filing, §32-2160. COMPLETION BOND. Public report. Application. Assurances for completion, R4-28-A1211. COMPUTATION OF TIME, R4-28-102. CONCEALING ASSETS. Cemeteries, §32-2194.03. Membership camping public reports. Denial, suspension, or revocation, §32-2198.08. Timeshares, §32-2197.15. CONDITIONAL SALES EXEMPTION, R4-28-B1202. CONDOMINIUM DEVELOPMENTS. Public report. Application, R4-28-A1219. CONDOMINIUM RECOVERY FUND, §§32-2193.31 to 32-2193.43. Actions for judgments payable from fund. Time limitations, §32-2193.34. Appeal of denial, §32-2193.39. CONDOMINIUM RECOVERY FUND —Cont’d Application for payment, §32-2193.34. Correction of deficiencies, §32-2193.36. Approval of payment. Contents of notice, §32-2193.38. Assignment of rights, §32-2193.42. Award limits, §32-2193.32. Commissioner, standing on behalf of fund, §32-2193.41. Deficiencies in application, §32-2193.36. Definitions, §32-2193.31. Denial of application. Contents of notice, §32-2193.38. Right of appeal, §32-2193.39. Effect of payment, §32-2193.34. Exemptions from liability, §32-2193.32. Final decision and order on claim, §32-2193.38. Investigation and discovery regarding applications, §32-2193.37. Investment of funds, §32-2193.40. Limitation of actions. Actions for judgments payable from fund, §32-2193.34. Losses payable, §32-2193.32. Management of fund, §32-2193.40. Notice of claim on judgment debtor, §32-2193.35. Notice of final decision and order on claim, §32-2193.38. Payments to fund, §32-2193.33. Proration proceedings, §32-2193.34. Purpose of fund, §32-2193.32. Response by judgment debtor, §32-2193.35. Response to appeal, §32-2193.39. Service of process on subdivider, §32-2193.34. Service of verified claim on appeal, §32-2193.39. Settlement of claim, §32-2193.39. Statute of limitations. Actions for judgments payable from fund, §32-2193.34. Subrogation of rights, §32-2193.42. Waiver of rights by failure to comply, §32-2193.43. CONFIDENTIALITY. Home address and home phone number of broker or salesperson licensee. Signed statement by licensee requesting, §32-2125.03. Social security number of broker or salesperson licensee, §32-2125.03. CONFLICTS OF INTEREST. Real estate department employees or officers. Interest in real estate company or real estate brokerage firm. Prohibition, §32-2110. 158 CONSENT ORDERS. Real estate commissioner. Authority to grant, §32-2153.01. CONTINUING EDUCATION REQUIREMENT. Renewal of broker or salesperson license, §32-2130, R4-28-402. Certificate of course attendance, filing, §32-2135. Distance learning courses, approval, R4-28-402. Waiver, R4-28-402. CONTRACTS. Cemeteries. Disclosure and disclaimers required, §32-2194.04. Membership camping. See MEMBERSHIP CAMPING. Property management agreements. Content requirements, §32-2173. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. Real estate employment agreements, §32-2151.02. Rescission. Contract language, R4-28-804. Sale or lease of subdivided lands, §32-2183. Sale without permanent access, §32-2185.02. Unimproved lot or parcel, §32-2185.01. Sale or lease of unsubdivided lands, §32-2195.04. Sale or lease of property interest in development. Disclosures, R4-28-803. Subdivided lands. Sale or lease generally. See SUBDIVISIONS. Timeshares. Purchase agreements. Rescission, §32-2197.03. Escrow or trust accounts for money received during rescission or construction period, §32-2197.05. Pre-sales cancellation, §32-2197.02. Reservations of timeshare interests, §32-2197.10. Supervisory duties of developers, §32-2197.11. Unsubdivided lands. Sale or lease generally. See UNSUBDIVIDED LANDS. CONTRIBUTION. Cemeteries. Violations. Civil liabilities, §32-2194.09. CONVICTION FOR FELONY. Application for broker or salesperson license. Information required, §32-2123. 159 CONVICTION FOR FELONY —Cont’d Cemeteries. Certificate of authority. Denial, grounds, §32-2194.03. Membership camping public reports. Denial, suspension, or revocation. Grounds, §32-2198.08. Renewal of broker of salesperson license. Prohibited, §32-2130. Timeshares. Investigations by real estate commissioner, §32-2197.14. Public reports. Denial, suspension, or revocation. Grounds, §32-2197.08. COPIES OF DEPARTMENT RECORDS. Evidence, certified copies, §32-2112. CORPORATIONS. Broker’s license. Designated broker. Designation of officer holding broker’s license to act as, §32-2125. Information required, R4-28-302. Exemption from broker or salesperson licensing, §32-2121. Licensing brokers and salespersons generally, §§32-2121 to 32-2136. See BROKERS AND SALESPERSONS. Professional corporations, §32-2125. Termination, §32-2125. Suspension, revocation or denial of renewal, §32-2125. Cemeteries. Transaction of business, authorization, §32-2194.17. Applications, §32-2194.18. Investigations, §32-2194.19. Change in officers, directors, articles, organization or control. Report to department by licensed corporation, §32-2125. Exemption from broker or salesperson licensing, §32-2121. Professional corporations. Broker’s license, §32-2125. Termination, §32-2125. Changes in license, information required, R4-28-303. Salespersons and associate brokers. Employing broker may engage services of, §32-2125. Public report. Application. Information required, R4-28-A1201. INDEX CORPORATIONS —Cont’d Real estate brokers generally. See REAL ESTATE BROKERS. Report to department by licensed corporation. Change in officers, directors, articles, organization or control, §32-2125. Subject to provisions of chapter when acting as broker or salespersons. Licensed as broker or salesperson, §32-2122. COUNTY TRUST AGREEMENT. Public report. Application. Assurances for completion, R4-28-A1211. COURT COSTS. Real estate recovery fund. Payment by fund, §32-2186. COVENANTS. Discriminatory restrictions and covenants. Disclaimer of validity. Real estate commissioner, duty to execute and record, §32-2107.01. Membership camping public reports. Applications, §32-2198.01. CREMATORIES. Applicability of provisions regarding cemeteries, §32-2194.31. Cemeteries generally. See CEMETERIES. CRIMINAL HISTORY RECORDS CHECKS. License applicants, §32-2108.01. CRIMINAL PENALTY. False statements or publications, §32-2161. Performing acts requiring license while incarcerated, §32-2166. Unlicensed persons. Performing acts or activities requiring license, §32-2165. CRIMINAL RECORDS. Character of applicant for license. Information to establish, §32-2123. D DAMAGES. Cemeteries. Violations. Civil liabilities, §32-2194.09. Membership camping contracts. Purchasers’ remedies, §32-2198.11. Real estate recovery fund. Limit on recovery, §32-2186. DAMAGES —Cont’d Sale or lease of unsubdivided lands. Suit for unlawful sales or leases, §32-2195.06. Subdivided land sales or leases. Unlawful practices, §32-2183.03. Timeshares. Fraudulent practices. Civil liabilities, §32-2197.19. DEATH ON PROPERTY SITE SUBJECT OF TRANSFER. Failure to disclose not grounds for termination or rescission, §32-2156. DECLARATIONS OF DEDICATION. Cemeteries. Filing, §32-2194.22. Timeshares. Contents, §32-2197.06. Public report applications, inclusion with, §32-2197.02. DEEDS. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. DEFAULT. Administrative procedures. Failure to file response, R4-28-1304. DEFINED TERMS. Accommodation. Timeshares, §32-2197. Acting in concert, §32-2101. Active license, R4-28-101. Active license status, R4-28-101. ADEQ, R4-28-101. Advertisement. Timeshares, §32-2197. Advertising, §32-2101. ADWR, R4-28-101. Affiliate, §32-2101. Applicant holder, §32-2108. Assessment. Timeshares, §32-2197. Associate broker, §32-2101. Association. Timeshares, §32-2197. Barrier, §32-2101. Blanket encumbrance, §32-2101. Broker, §32-2101. Camping site, §32-2101. Cemetery broker, §32-2101. Cemetery or cemetery property, §32-2101. Cemetery salesperson, §32-2101. Closing, R4-28-101. Common promotional plan, §32-2101. Compensation, §32-2101. Complaint. Real estate recovery fund, §32-2188. Comply substantially. Condominium recovery fund, §32-2193.36. INDEX DEFINED TERMS —Cont’d Component site. Timeshares, §32-2197. Condominium. Condominium recovery fund, §32-2193.31. Conscientiously and in good faith, §32-2188. Contiguous, §32-2101. Control or controlled, §32-2101. Corporation licensee, §32-2101. Course, R4-28-101. Credit hour, R4-28-101. D.b.a., R4-28-101. Deposit. Condominium recovery fund, §32-2193.31. Designated broker, §32-2101. Developer, §32-2101. Timeshares, §32-2197. Development, §32-2101. Dispose. Timeshares, §32-2197. Disposition. Timeshares, §32-2197. Distance learning course, R4-28-101. Employing broker, §32-2101. Exchange company. Timeshares, §32-2197. Exchange program. Timeshares, §32-2197. Finder fee. Timeshares, §32-2197.21. Fractional interest, §32-2101. Immediate family, R4-28-101. Improved lot or parcel, §32-2101. Inactive license, §32-2101. Individual, R4-28-101. Judgment. Condominium recovery fund, §32-2193.31. Real estate recovery fund, §32-2186. Judgment debtor. Condominium recovery fund, §32-2193.31. Real estate recovery fund, §32-2186. Lease or leasing, §32-2101. Letter of concern, §32-2153. License, §32-2101. Licensee, §32-2101. License period, §32-2101. Limited liability company licensee, §32-2101. Lot reservation, §32-2101. Managing entity. Timeshares, §32-2197. Master planned community, §32-2101. Material change, R4-28-101. Membership camping broker, §32-2101. Membership camping contract, §32-2101. Membership camping operator, §32-2101. DEFINED TERMS —Cont’d Membership camping salesperson, §32-2101. Multisite timeshare plan. Timeshares, §32-2197. Nonresident license, R4-28-101. Nonspecific timeshare interest. Timeshares, §32-2197. Offer. Timeshares, §32-2197. Offering. Timeshares, §32-2197. Partnership licensee, §32-2101. Permanent access, §32-2101. Perpetual-care or endowed care, §32-2101. Perpetual or endowed-care cemetery, §32-2101. Person, §32-2101. Timeshares, §32-2197. Premium. Timeshares, §32-2197. Principal. Cemeteries, §32-2194.01. Subdivisions, §32-2181. Timeshares, §32-2197.02. Unsubdivided lands, §32-2195. Private cemetery, §32-2101. Promotion, §32-2101. Timeshares, §32-2197. Promotional practice, §32-2101. Property interest, R4-28-101. Property management firm, §32-2171. Provisional license, §32-2153. Purchase agreement. Timeshares, §32-2197. Purchaser. Timeshares, §32-2197. Real estate, §32-2101. Real estate broker, §32-2101. Real estate employment agreements, §32-2151.02. Real estate sales contract, §32-2101. Real estate salesperson, §32-2101. Redemption certificate. Timeshares, §32-2197. Rental agreement. Property management firm, §32-2171. Reservation system. Timeshares, §32-2197. Residential leasing agents or on-site managers, §32-2121. Sale, §32-2101. Sales agent. Timeshares, §32-2197. Salesperson, §32-2101. School, §32-2101. Single site timeshare plan, §32-2197. Specific timeshare interest, §32-2197. Stock cooperative, §32-2101. Subdivider, §32-2101. Subdivision or subdivided lands, §32-2101. Timeshare, §32-2101. 160 DEFINED TERMS —Cont’d Timeshare estate, §32-2197. Timeshare instrument, §32-2197. Timeshare interest, §32-2197. Timeshare period, §32-2197. Timeshare plan, §32-2197. Timeshare property, §32-2101. Timeshares, real estate, §32-2197. Timeshare use, §32-2197. Trustee, §32-2101. Unimproved lot or parcel, §32-2101. Unsubdivided lands, §32-2101. DEPARTMENT. See REAL ESTATE DEPARTMENT. DEPOSITS. Earnest money, R4-28-B1210. Timeshares. Purchase agreements, §32-2197.05. Reservations of timeshare interests, §32-2197.10. DESIGNATED BROKERS. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Cash, checks or other items of value received. Licensees to place in care of designated broker, §32-2151.01. Change, R4-28-302. Corporations, limited liability companies and partnerships. Designation required, §32-2125. Defined, §32-2101. Display of license, §32-2128. Licensing of broker and sales persons generally. See BROKERS AND SALESPERSONS. Responsibilities, R4-28-302. Review of listing agreements, purchase or nonresidential lease agreement, §32-2151.01. Sign at place of business, §32-2126. Supervision and control, duties, R4-28-1103. Temporary absence. Designation of licensee to act, §32-2127. DEVELOPERS. Defined, §32-2101. Development fees, R4-28-104. Earnest money. Deposit by developer, R4-28-B1210. Public report receipt. Completion required, form, R4-28-805. Record requirements. Sale or lease of property without services of broker, §32-2151.01, R4-28-B1211. Suspension of sale or lease of property, commissioner’s order. Appeal of final decision, §32-2159. 161 DEVELOPERS —Cont’d Suspension of sale or lease of property, commissioner’s order —Cont’d Service of process by commissioner, §32-2158. Summary suspension of sales, §32-2157. Witnesses at hearing. Right of attendance of witnesses, §32-2158. Written notice of charges, §32-2157. DEVELOPMENT FEES, R4-28-104. DEVELOPMENT MAP. Public report. Application. Submission of legal copy, size restrictions, content requirements, R4-28-A1202. DEVELOPMENTS. Advertising, R4-28-504. Defined, §32-2101. Development fees, R4-28-104. Disclosures. Contracts for sale or lease of property in, R4-28-803. Public report. Generally. See PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. Subdivisions. Generally, §§32-2181 to 32-2185.09. See SUBDIVISIONS. DISCIPLINE OF BROKERS OR SALESPERSONS. Appeal of final decision, §32-2159. Authorized punishments, §32-2153. False statements or publications. Criminal penalty, suspension of license, §32-2161. Grounds, §32-2153. Service of process by commissioner, §32-2158. Summary suspension, §32-2157. Witnesses at hearing. Right of attendance of witnesses, §32-2158. Written notice of charges, §32-2157. DISCLAIMER. Validity of discriminatory restrictions and covenants. Real estate commissioner. Duty to execute and record, §32-2107.01. DISCLOSURES IN REAL ESTATE TRANSACTIONS. Information material and adversely affecting consideration, R4-28-1101. INDEX DISCLOSURES IN REAL ESTATE TRANSACTIONS —Cont’d Property site of death, owned or occupied by person with AIDS or HIV, or in vicinity of sex offender. Failure to disclose not grounds for termination or rescission, §32-2156. DISCOVERY. Condominium recovery fund. Investigation and discovery regarding applications, §32-2193.37. Real estate recovery fund. Application for payment from fund, §32-2188.03. DISCRIMINATORY RESTRICTIONS AND COVENANTS. Disclaimer of validity. Real estate commissioner. Duty to execute and record, §32-2107.01. DRAINAGE IMPROVEMENTS. Public report. Application, R4-28-A1208. DRAINAGE PROBLEMS. Public report. Application. Letter included, R4-28-A1203. E EARNEST MONEY. Deposit by developer, R4-28-B1210. Receipts. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. Type received. Broker to state in contract, agreement or receipt, §32-2151.01. EDUCATION REQUIREMENTS. Licensure of brokers and salespersons, R4-28-401. Continuing education requirement. Certificate of course attendance, filing, §32-2135. Renewal of license, §32-2130, R4-28-402. Distance learning courses, approval, R4-28-402. Waiver, R4-28-402. Real estate brokers or salespersons, §32-2124. Waiver of prelicensure courses, R4-28-401. ELECTRICITY. Public report. Application. Utilities available to development, R4-28-A1204. ELECTRONIC FORMAT. Timeshares. Public reports. Format, §32-2197.08. Reservations of timeshare interests. Notice of intent to accept. Format, §32-2197.10. EMPLOYING BROKERS. Administrative severance of license from, R4-28-303. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Defined, §32-2101. Display of license, §32-2128. Expiration of license. Licenses of employees severed from broker, §32-2130. Inspection of records, §32-2151.01. Licensing of brokers and salespersons generally. See BROKERS AND SALESPERSONS. Place of business. Definite place requirement, change of location, notice, failure to give, §32-2126. Sign, requirements, §32-2126. Real estate licensee. Cemetery and membership camping salespersons and associate brokers. Employment without being separately licensed, §32-2125.01. Number licensee allowed, categories, §32-2125.01. Responsibilities, R4-28-302. Supervision and control, duties, R4-28-1103. EMPLOYMENT AGREEMENTS. Real estate employment agreements, §32-2151.02. ENDOWMENT-CARE FUND. Cemeteries. Deposits from sales, §32-2194.28. Reclaimed lots, §32-2194.33. Funds, restrictions on use, §32-2194.30. Irrevocable trust fund. Contents and restrictions, §32-2194.27. Establishment and deposits required, §32-2194.26. ESCROW AGREEMENT. Public report. Application. Assurances for completion, R4-28-A1211. ESCROW OR TRUST ACCOUNTS. Timeshares. Rescission or construction period, money received during, §32-2197.05. INDEX ESCROW OR TRUST ACCOUNTS —Cont’d Timeshares —Cont’d Reservations of timeshare interests, §32-2197.10. Trust accounts generally. See TRUST ACCOUNTS. EVIDENCE. Certified copies of department records, §32-2112. Membership camping contracts. Cancellation, §32-2198.05. Timeshares. Construction, completion, §32-2197.05. Deposit of money into escrow or trust account during rescission or construction period, §32-2197.05. Reservation of timeshare interests. Notices sent by mail, §32-2197.10. EXAMINATION. Broker or salesperson license applicants, §32-2124, R4-28-403. Cemeteries, §32-2194.02. Books and records, §32-2194.03. Development inspection fee, R4-28-104. Membership camping projects, §32-2198.04. Development inspection fee, R4-28-104. Power of real estate commissioner. Books and records of licensees, §32-2108. Subdivision offered for sale or lease, §32-2182. Development inspection fee, R4-28-104. Timeshare plans, §32-2197.07. EXECUTION OF NOTES. Membership camping contracts, §32-2198.06. EX PARTE ORDERS. Timeshares. Writ of ne exeat and appointment of receivers, §32-2197.15. EXPEDITED PUBLIC REPORT REGISTRATION, R4-28-B1201. EXPENSES. Cemeteries. Development inspection fee, R4-28-104. Examination, §32-2194.02. Membership camping. Lotteries and drawings. Field inspections, §32-2198.10. Project examinations. Travel and food, §32-2198.04. Timeshares. Investigations. Travel and food, §32-2197.14. Plan examinations. Travel and food, §32-2197.07. F FAIR HOUSING VIOLATIONS. Department, no jurisdiction over, §32-2160. FALSE STATEMENTS OR PUBLICATIONS. Cemeteries. Notice of intention. Civil liabilities, §32-2194.09. Criminal penalty, suspension of license, §32-2161. Timeshares. Intent to sell. False statements, civil liability for, §32-2197.19. FEDERAL TAX IDENTIFICATION. Application for broker or salesperson license. Information required, §32-2123. FEES. Brokers and salespersons, schedule, §32-2132. Cemeteries. Deposit, §32-2194.13. Development inspection fee, R4-28-104. Examination, §32-2194.02. Modification of plans. Amendment of notice, §32-2194.10. Development fees, R4-28-104. Membership camping. Lotteries and drawings, applications, §32-2198.10. Public reports and special order exemptions, §32-2198.09. Sale or lease of unsubdivided lands. Development inspection fee, R4-28-104. Filing fee, §32-2195.02. Subdivided land offered for sale or lease. Filing fee, §32-2182. Amendment of public report, §32-2184. Timeshares. Exemption of timeshare plans, petitions for, §32-2197.23. Filing certain documents, §32-2197.07. FELONY CONVICTIONS. Application for broker or salesperson license. Information required, §32-2123. Cemeteries. Certificate of authority. Denial, grounds, §32-2194.03. Membership camping public reports. Denial, suspension, or revocation. Grounds, §32-2198.08. Renewal of broker of salesperson license. Prohibited, §32-2130. 162 FELONY CONVICTIONS —Cont’d Timeshares. Investigations by real estate commissioner, §32-2197.14. Public reports. Denial, suspension, or revocation. Grounds, §32-2197.08. FIDUCIARY DUTY TO CLIENT. Brokers and salespersons, R4-28-1101. FILING DOCUMENTS. When considered filed, timely filing, R4-28-102. FINANCIAL STATEMENTS. Membership camping operators. Public reports, applications, §32-2198.01. FINDER’S FEES. Payment to tenants. Property management firms. Defined, authorization, limits, prohibited acts, §32-2176. Records required, §32-2175. Timeshares, §32-2197.21. FINGERPRINTS. License applicants, §32-2108.01. Character of applicant. Information to establish, §32-2123. FIRE PROTECTION. Public report. Application. Information about services, R4-28-A1212. FLOODING PROBLEMS. Public report. Application. Letter included, R4-28-A1203. FLOOD PROTECTION. Public report. Application, R4-28-A1208. FOREIGN DEVELOPMENTS. Public report. Application, R4-28-A1220. FORMS. Membership camping public reports. Applications, §32-2198.01. Public report receipt, R4-28-805. Real estate recovery fund. Notice of appeal. Denial of claim by commissioner, §32-2188.05. Notice of claim on judgment debtor, §32-2188.01. FRAUD. Cemeteries. Certificate of authority, denial. Grounds, §32-2194.03. Civil liabilities, §32-2194.09. False statements or publications, §32-2161. Membership camping contracts. Denial, suspension, or revocation. Grounds, §32-2198.08. 163 FRAUD —Cont’d Membership camping contracts —Cont’d Purchasers’ remedies, §32-2198.11. Sale or lease of subdivided lands, §32-2183.01. Timeshares. Investigations by real estate commissioner, §32-2197.14. Public reports. Denial, suspension, or revocation. Grounds, §32-2197.08. G GARBAGE AND REFUSE COLLECTION. Public report. Application. Information about services, R4-28-A1212. GENERAL ORDER OF EXEMPTION. Generally. See PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. GHOSTS IN THE ATTIC ACT. Failure to disclose not affecting property, §32-2156. GOOD MORAL CHARACTER. Applicant for or holder of license or public report. Additional information to determine. Power of commissioner to require, §32-2108. GROUNDS FOR DISCIPLINE OF BROKERS AND SALESPERSONS, §32-2153. GROUNDWATER ACTIVE MANAGEMENT AREAS. Subdivided lands within. Certificate of assured water supply, §32-2181. Required for issuance of public report, §32-2183. Timeshares. Public reports. Denial, suspension, or revocation. Grounds, §32-2197.08. H HEARINGS. Cease and desist order issued by commissioner. Requesting, §32-2154. Cemeteries. Advertising, violations, §32-2194.05. Certificate of authority, denial, §32-2194.03. INDEX HEARINGS —Cont’d Membership camping public reports. Denial, suspension, or revocation, §32-2198.08. Subdivision denied application for public report, §32-2183. Timeshares. Investigations by real estate commissioner, §32-2197.14. Public reports. Denial, §32-2197.13. Receivers, appointment, §32-2197.15. HIV. Property subject to transfer owned or occupied by person diagnosed as having. Failure to disclose not grounds for termination or rescission, §32-2156. HOMICIDE ON PROPERTY SUBJECT TO TRANSFER. Failure to disclose not grounds for termination or rescission, §32-2156. HOTEL MANAGERS. Inapplicability of broker or salesperson licensing provision, §32-2121. HUD. Public report. Filing with, R4-28-B1206. I IDENTIFICATION. Pocket card identification issued to licensee. Return. Cancellation, termination, suspension or revocation of licensee, §32-2128. INDIGENTS. Appeal of final decision of commissioner. Cost of transcript, production of administrative record. Payment by department, §32-2159. INJUNCTIONS. Authority of commissioner, §32-2154. Cemeteries. Certificate of authority. Denial, grounds, §32-2194.03. Recordation, §32-2194.07. Violations, §32-2194.03. Advertising, §32-2194.05. Membership camping public reports. Denial, suspension, or revocation, §32-2198.08. Timeshares. Public reports. Denial, suspension, or revocation. Grounds, §32-2197.08. INSPECTION. Cemeteries. Records, §32-2194.06. Employing broker’s records by commissioner. Open for, §32-2151.01. Subdivisions. Development inspection fee, R4-28-104. Lot or parcel by purchaser. Unimproved lots or parcels subject of sale or lease, §32-2185.01. Subdivision site, §32-2182. Timeshare plans, §32-2197.07. INTERNET. Advertising the offering of property interests, R4-28-502. Offering of real estate brokerage services by. Activity requiring broker’s license, §32-2163. Real estate department. Military maps to be posted on web site, §32-2115. INTERVENTION. Real estate recovery fund. Authority of department, §32-2188. INVESTIGATIONS. Cemeteries, §32-2194.03. Applicants seeking to transact business, §32-2194.19. Condominium recovery fund. Investigation and discovery regarding applications, §32-2193.37. Membership camping. Development inspection fee, R4-28-104. Examination of projects, §32-2198.04. Public reports. Denial, suspension, or revocation, §32-2198.08. Powers of commissioner, §32-2108. Subdivisions. Unlawful practices, §32-2183. Timeshares. Violations, §32-2197.14. IRREVOCABLE LETTER OF CREDIT. Public report. Application. Assurances for completion, R4-28-A1211. J JOB PLACEMENT SERVICES. Real estate schools. Advertising, R4-28-404. JOINDER OF ACTIONS. Real estate recovery fund, §32-2188. INDEX JOINT VENTURE AGREEMENTS. Membership camping club associations. Public reports, applications, §32-2198.01. L LANDLORD AND TENANT DISPUTES. Department, no jurisdiction over, §32-2160. LEASE AGREEMENTS. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. LEASE OR SALE OF SUBDIVIDED LANDS. Generally, §§32-2181 to 32-2185.09. See SUBDIVISIONS. LEASE OR SALE OF UNSUBDIVIDED LANDS, §§32-2195 to 32-2195.12. See UNSUBDIVIDED LANDS. LETTER OF CONCERN. Brokers and salespersons. Issuance, grounds, §32-2153. LETTER OF CREDIT. Public report. Application. Assurances for completion, R4-28-A1211. LICENSE FEES. Brokers and salespersons. Payment, §32-2129. Schedule, §32-2132. LICENSING BROKERS AND SALESPERSONS. Statutes and regulations generally. See BROKERS AND SALESPERSONS. LIENS. Membership camping. Public reports, applications, §32-2198.01. LIMITATION OF ACTIONS. Cemeteries. Purchasers. Action to void sale, §32-2194.03. Violations, civil liabilities, §32-2194.09. Condominium recovery fund. Actions for judgments payable from fund, §32-2193.34. Real estate recovery fund. Action resulting in order for payment by fund, §32-2188. Application for payment from fund. Filing, §32-2188. Sale or lease of subdivided lands. Action for violations, §32-2183.03. LIMITATION OF ACTIONS —Cont’d Sale or lease of subdivided lands —Cont’d Action to rescind, §32-2183. Civil penalty, imposition, suspension or revocation of license, §32-2185.09. Sale or lease of unsubdivided lands. Action to void transaction, §32-2195.03. Suit for unlawful sales or leases, §32-2195.06. Timeshares. Fraudulent practices, §32-2197.19. Rescission of the sale or lease of timeshare interests, actions for, §32-2197.09. LIMITED LIABILITY COMPANIES. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Broker’s license. Designated broker. Designation of manager or member holding broker’s license to act as, §32-2125. Information required, R4-28-302. Licensing brokers and salespersons generally, §§32-2121 to 32-2136. See BROKERS AND SALESPERSONS. Professional limited liability companies, §32-2125. Termination, §32-2125. Suspension, revocation, denial of renewal, §32-2125. Cemeteries. Transaction of business, authorization, §32-2194.17. Change in managers, members or organization. Report to department by licensed company, §32-2125. Exemption from broker or salesperson licensing, §32-2121. Professional limited liability companies. Broker’s license, §32-2125. Termination, §32-2125. Changes in license, information required, R4-28-303. Salespersons and associate brokers. Employing broker may engage services of, §32-2125. Public report. Application. Information required, R4-28-A1201. Real estate brokers generally. See REAL ESTATE BROKERS. Report to department by licensed company. Change in managers, members or organization, §32-2125. 164 LIMITED LIABILITY COMPANIES —Cont’d Subject to provisions of chapter when acting as broker or salespersons. Licensed as broker or salesperson, §32-2122. LOAN COMMITMENT AND AGREEMENT. Public report. Application. Assurances for completion, R4-28-A1211. LOANS SECURED BY REAL PROPERTY. Real estate brokers or salespersons. Collecting compensation for rendering services in negotiating, §32-2155. LOT RESERVATIONS. Subdivisions. Accepting, §32-2181.03. Cancellation by prospective buyer, §32-2181.03. Denial of authorization to accept, §32-2181.03. Exemption from notice and public report requirements, §32-2181.03. Expiration of authority to take, §32-2181.03. Notice of intent to accept, §32-2181.03. Requirements, §32-2181.03. Reservation deposit, amount, limitation, §32-2181.03. Statement required, §32-2181.03. Termination. Refund to prospective buyer, §32-2181.03. Transfer of rights, §32-2181.03. LOTTERY OR DRAWING. Membership camping, §32-2198.10. Application. Approval, R4-28-503. Selling interest in development, R4-28-503. Subdivider. Application for approval, R4-28-503. Subdivisions. Drawings or contests to induce prospective buyers to visit, §32-2183.01. Timeshares, §32-2197.17. Application for approval, R4-28-503. M MANAGERS OF RESIDENTIAL RENTAL PROPERTY. Bonus based on performance. When not considered special compensation, §32-2121. 165 MANAGERS OF RESIDENTIAL RENTAL PROPERTY —Cont’d Defined, §32-2121. Employment by brokers, §32-2155. Licensing of brokers and salespersons. Exemption from provisions, §32-2121. Property management generally, §§32-2171 to 32-2176. MAPS. Cemeteries. Filing, §32-2194.22. Notice of intention to sell cemetery property. Contents, §32-2194.01. Records, §32-2194.06. Earth fissure maps. Real estate department. Providing and posting on web site, §32-2117. Military electronics range map. Posting on department web site, §32-2115. Public report. Application. Development map. Submission of legal copy, size restrictions, content requirements, R4-28-A1202. Timeshares. Public reports, applications, §32-2197.02. MASTER PLANNED COMMUNITY. Defined, §32-2101. Public report. Application. Information required, R4-28-A1210. MEDICAL FACILITIES. Public report. Application. Information about services, R4-28-A1212. MEMBERSHIP CAMPING. Camping site. Defined, §32-2101. Construction and interpretation of article, §32-2198.13. Contracts. Actions. Authorized, §32-2198.11. Defenses retained by purchasers, §32-2198.06. Assignment, §32-2198.06. Cancellation, §32-2198.05. Defined, §32-2101. Notes, execution, §32-2198.06. Public reports, applications, §32-2198.01. Purchasers’ remedies, §32-2198.11. Sales or offers, §32-2198. Advertising, §32-2198.10. Availability of campgrounds, §32-2198.14. INDEX MEMBERSHIP CAMPING —Cont’d Contracts —Cont’d Sales or offers —Cont’d Advertising —Cont’d Disclosure in public report applications, §32-2198.01. Authorization, §32-2198.02. Exemptions from provisions, §32-2198.03. Lotteries or drawing, §32-2198.10. Encumbrances or liens on campgrounds, §32-2198.14. Exemptions from provisions, §32-2198.03. Fees for special orders, §32-2198.09. False statements or publications. Criminal penalty, §32-2161. Fees. Lotteries and drawings, applications, §32-2198.10. Public reports and special order exemptions, §32-2198.09. Lottery or drawing, §32-2198.10. Application. Approval, R4-28-503. Nondisturbance agreements, §32-2198.14. Lotteries and drawings. Requirements, §32-2198.10. Operators. Cancellation of contracts, §32-2198.05. Defined, §32-2101. Encumbrances on campgrounds, §32-2198.14. Exemptions from provisions, §32-2198.03. Lotteries and drawings, §32-2198.10. Public reports. Applications, §32-2198.01. Denial, suspension or revocation, §32-2198.08. Misrepresentations concerning, §32-2198.02. Provision to purchasers, §32-2198.02. Owners. Advertising plans, §32-2198.10. Examination of projects. Costs, §32-2198.04. Development inspection fee, R4-28-104. Exemptions, §32-2198.03. Public reports. Applications. Disclosure, §32-2198.01. Denial, suspension, or revocation, §32-2198.08. Issuance, §32-2198.02. Purchasers, provision to, §32-2198.02. Public report. Applications and amendments, §32-2198.01, R4-28-A1222. Examination of project by commissioner, §32-2198.04. MEMBERSHIP CAMPING —Cont’d Public report —Cont’d Applications and amendments —Cont’d Fees, §32-2198.09. Incompleteness. Grounds for denial, suspension, or revocation of public reports, §32-2198.08. Denial, suspension, or revocation, §32-2198.08. Effect, §32-2198.02. Generally. See PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. Issuance, §32-2198.02. Misrepresentations concerning, §32-2198.02. Provision to purchasers, §32-2198.02. Sale or offer of contracts, requirements, §32-2198. Purchasers. Actions. Defenses retained, §32-2198.06. Assignment, §32-2198.06. Cancellation, §32-2198.05. Encumbrances, §32-2198.14. Notes, execution, §32-2198.06. Protection. Denial, suspension or revocation of public reports, §32-2198.08. Public report provided by owners or operators, §32-2198.02. Remedies, §32-2198.11. Voidable sales or offers, §32-2198. Suspension of sale of contracts. Appeal of final decision, §32-2159. Service of process by commissioner, §32-2158. Summary suspension of sales, §32-2157. Witnesses at hearing. Right of attendance of witnesses, §32-2158. Written notice of charges, §32-2157. MEMBERSHIP CAMPING BROKERS. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Continuing education requirement. Renewal of license. Exemption, §32-2130. Defined, §32-2101. Discipline generally. See BROKERS AND SALESPERSONS. INDEX MEMBERSHIP CAMPING BROKERS —Cont’d Licensing. Brokers and salespersons generally. Statutes and rules. See BROKERS AND SALESPERSONS. Continuing education requirement. Renewal of license. Exemption, §32-2130. Examination, §32-2124. Experience requirement, §32-2124. Suspension or revocation. See BROKERS AND SALESPERSONS. Lotteries and drawings, §32-2198.10. Membership camping generally, §§32-2198 to 32-2198.14. See MEMBERSHIP CAMPING. MEMBERSHIP CAMPING SALESPERSONS. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Certificate of convenience, §32-2134.01. Fee, §32-2132. Information required, R4-28-305. Continuing education requirement. Renewal of license. Exemption, §32-2130. Defined, §32-2101. Discipline generally. See BROKERS AND SALESPERSONS. Licensing. Brokers and salespersons generally. Statutes and rules. See BROKERS AND SALESPERSONS. Continuing education requirement. Renewal of license. Exemption, §32-2130. Examination, §32-2124. Suspension or revocation. See BROKERS AND SALESPERSONS. Membership camping generally, §§32-2198 to 32-2198.14. See MEMBERSHIP CAMPING. Registration, exemption, §32-2198.03. MILITARY AIRPORT AND ANCILLARY MILITARY FACILITY. Increased noise and accident potential disclosure for property located within territory in vicinity. Duty of commissioner to execute and record, §32-2113. Sale or lease of subdivided lands. Lots located within territory in vicinity, statement required, §32-2183. MILITARY AIRPORT AND ANCILLARY MILITARY FACILITY —Cont’d Sale or lease of unsubdivided lands. Statement in public report. Land located within territory in vicinity of airport, §32-2195.03. MILITARY ELECTRONICS RANGE. Land contained within, §32-2114.01. Map, posting on department web site, §32-2115. Subdivider’s report. Land located within range, §32-2183.05. MILITARY TRAINING ROUTE. Contacts. Posting on department’s website, §32-2116. Disclosure for land under. Duty of commissioner to execute and record, §32-2114. Subdivision public report authorizing sale or lease. Lots located under. Statement required in public report, §32-2183. MINERAL RIGHTS. Public report. Application. Reservation, R4-28-A1214. MISDEMEANOR CONVICTIONS. Cemeteries. Certificate of authority. Denial, grounds, §32-2194.03. Membership camping public reports. Denial, suspension, or revocation. Grounds, §32-2198.08. Timeshares. Public reports. Denial, suspension, or revocation. Grounds, §32-2197.08. MORTGAGE BROKER SERVICES. Real estate brokers or salespersons. Compensation for rendering services in negotiating loans secured by real property, §32-2155. MORTGAGES. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. MOTEL MANAGERS. Inapplicability of broker or salesperson licensing provision, §32-2121. 166 MURDER ON PROPERTY SUBJECT TO TRANSFER. Failure to disclose not grounds for termination or rescission, §32-2156. N NATURAL GAS. Public report. Application. Utilities available to development, R4-28-A1204. NOISE. Public report. Application. Development affected by, R4-28-A1203. NONCUSTODIAL PARENTS. Locating parents or assets of parents. Use of license applicants social security number or tax identification, §32-2123. NONPROFIT CORPORATIONS. Exemption from broker or salesperson licensing provisions. Commissioner granting, §32-2121. NONRESIDENT BROKERS AND SALESPERSONS. Cooperation with out-of-state brokers. Brokers licensed in state, §32-2163. Course specific to state’s statutes, rules and regulations. Completion required by license applicants, §32-2125.02. Employment or compensation, §32-2125.02. Information required. Foreign entity applying for license, R4-28-302. Payment to and receipt of compensation from out-of-state brokers, §32-2163. Records. Maintained in state, address records kept, notice to commissioner, §32-2125.02, R4-28-302. Service of process on, §32-2125.02. Appointment of commissioner as agent or attorney in fact for acceptance, §32-2125.02. Signs by out-of-state brokers. Placing on property prohibited, §32-2163. Trust account. Broker maintaining office in state, R4-28-302. Unlicensed out-of-state brokers listing, marketing or advertising real estate. Prohibition, §32-2163. 167 NOTES. Execution. Membership camping contracts, §32-2198.06. NOTICE. Appearance of counsel. Administrative procedures, R4-28-1305. Cemeteries. Appointment of receiver, §32-2194.03. Intention to sell property, §32-2194.01. Modifications to cemetery plans, §32-2194.10. Writ of ne exeat, §32-2194.03. Change of place of broker’s business location, §32-2126. Condominium recovery fund. Notice of claim on judgment debtor, §32-2193.35. Notice of final decision and order on claim, §32-2193.38. Lot reservations. Subdivider’s intent to accept, §32-2181.03. Membership camping. Contracts. Cancellation, §32-2198.05. Receivers. Appointment, §32-2198.08. Real estate recovery fund. Appeal of denial of claim by commissioner, §32-2188.05. Claim on judgment debtor. Form, service, time period, §32-2188.01. Final decision on claim, §32-2188.04. Sale or lease of subdivided lands. Change of subdivision plan after approval, §32-2184. Exemptions, §32-2181.02. False statements, action for, §32-2183.01. Intention to subdivide for sale or lease, §32-2181. Sale or lease of unsubdivided lands. Intention to offer lands for sale or lease, §32-2195. Suspension, revocation or denial of license or sale or lease of property. Written notice of charges, §32-2157. Timeshares. Intent to sell, §32-2197.02. False statements, civil liability for, §32-2197.19. Public reports. Material changes to timeshare plans. Supplements required, §32-2197.04. Receivers, appointment, §32-2197.15. Rescission of purchase agreements, §32-2197.03. INDEX NOTICE —Cont’d Timeshares —Cont’d Reservation of timeshare interests. Intent to accept, §32-2197.10. Public report, denial of application, §32-2197.10. Termination, §32-2197.10. Writ of ne exeat, §32-2197.15. NUISANCES. Public report. Application. Development affected by, R4-28-A1203. NURSING CARE INSTITUTIONS. Residential property management, marketing and promotional services. Persons performing for institutions. Inapplicability of licensing provision, §32-2121. O ODORS. Public report. Application. Development affected by, R4-28-A1203. OFFERS TO PURCHASE OR LEASE PROPERTY. Submission of all offers during listing period and prior to closing, R4-28-802. OPTIONS. Public report, R4-28-B1209. OUT-OF-STATE BROKERS, §32-2163. P PAROLEES. Broker or salesperson license. Not issued to, §32-2124. Renewal prohibited, §32-2130. PARTNERSHIPS. Acting as broker or salesperson. Subject to provisions of chapter, §32-2122. Broker’s license. Designated broker. Designation of partner holding broker’s license to act as, §32-2125. Information required, R4-28-302. Licensing brokers and salespersons generally, §§32-2121 to 32-2136. See BROKERS AND SALESPERSONS. Suspension, revocation, denial of renewal, §32-2125. Change in partners or organization. Report to department by licensed partnership, §32-2125. PARTNERSHIPS —Cont’d Exemption from broker or salesperson licensing, §32-2121. Membership camping club associations, agreement. Public reports. Applications, §32-2198.01. Public report. Application. Information required, R4-28-A1201. Real estate brokers generally. See REAL ESTATE BROKERS. Report to department by licensed partnership. Change in partners or organization, §32-2125. PERMITS. Membership camping operators. Public reports, applications, §32-2198.01. POCKET CARD IDENTIFICATION ISSUED TO LICENSEE. Return. Cancellation, termination, suspension or revocation of licensee, §32-2128. POLICE. Public report. Application. Information about services, R4-28-A1212. POLLUTION. Public report. Application. Development affected by, R4-28-A1203. PRESUMPTION. Common promotional plan. Land offered for sale or lease as, §32-2101. PRISONERS. Broker or salesperson license. Not issued to, §32-2124. Renewal prohibited, §32-2130. Performing acts requiring license while incarcerated. Criminal penalty, §32-2166. PRIZES. Promoting sales or leasing as, R4-28-503. PROFESSIONAL CORPORATIONS. Broker’s license, §32-2125. Termination, §32-2125. Changes in license, information required, R4-28-303. Salespersons and associate brokers. Employing broker may engage services of, §32-2125. PROFESSIONAL LIMITED LIABILITY COMPANIES. Broker’s license, §32-2125. Termination, §32-2125. INDEX PROFESSIONAL LIMITED LIABILITY COMPANIES —Cont’d Changes in license, information required, R4-28-303. Salespersons and associate brokers. Employing broker may engage services of, §32-2125. PROPERTY MANAGEMENT, §§32-2171 to 32-2176. Article supersedes laws and rules relating to property management, §32-2172. Audit of firms, §32-2175. Definitions, §32-2171. Delegation of authority. Designated broker to sign, §32-2175. Final accounting. Termination of agreement, firm to provide, time, §32-2173. Finder’s fees paid to tenants. Defined, authorization, limits, prohibited acts, §32-2176. Records required, §32-2175. Nonresidential real estate lease agreements. Records required, §32-2175. Property management accounts. Trust accounts, §32-2174. Property management agreements. Content requirements, §32-2173. Recordkeeping requirements, §32-2175. Retention of records, requirement, time, §32-2175. Tenant’s deposits. Disposition, rental agreement to state, §32-2174. Termination of agreement. Duties of property management firm, §32-2173. Transaction folders. Records required, §32-2175. Trust accounts. Property management accounts, §32-2174. PROPERTY MANAGEMENT ACCOUNTS. Trust accounts, §32-2174. PROPERTY MANAGEMENT AGREEMENTS. Content requirements, §32-2173. PROPERTY OWNERS’ ASSOCIATIONS. Public report. Application. Information about, R4-28-A1213. PROVISIONAL LICENSE. Brokers and salespersons. Issuance, grounds, §32-2153. PUBLICATION. Real estate recovery fund. Service by, §32-2188. PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. Amendment of public report, R4-28-B1203. Application. Access to land. Information about, R4-28-A1207. Adult occupancy or age restrictions, R4-28-A1214. Affidavit, truthfulness and correctness of information, R4-28-A1223. Agricultural activity or conditions, R4-28-A1203. Cemetery developments, R4-28-A1221. Common, community and recreational improvements, R4-28-A1209. Completion, assurances, R4-28-A1211. Condominium developments, R4-28-A1219. Corporations. Information required, R4-28-A1201. Department of environmental quality approval, R4-28-A1217. Description of physical characteristics of property, R4-28-A1202. Development map. Submission of legal copy, size restrictions, content requirements, R4-28-A1202. Development uses, R4-28-A1214. Flooding or drainage improvements, R4-28-A1208. Flooding or drainage problems, R4-28-A1203. Foreign developments, R4-28-A1220. Geological or environmental conditions, R4-28-A1203. Identification of property, R4-28-A1202. Information required, R4-28-A1201. Jurisdiction where property registered, list, R4-28-A1218. Limited liability companies. Information required, R4-28-A1201. Livestock roaming, R4-28-A1214. Maintenance, assurances, R4-28-A1211. Master planned community. Information required, R4-28-A1210. Membership camping developments, R4-28-A1222. Mineral rights, reservation, R4-28-A1214. Odors, noises, pollutants or other nuisances, R4-28-A1203. 168 PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION —Cont’d Application —Cont’d Partnerships. Information required, R4-28-A1201. Persons who may apply, R4-28-A1201. Property owners’ association. Information about, R4-28-A1213. Sales offering, description, R4-28-A1215. Schools. Information about, R4-28-A1212. Services provided. Information about, R4-28-A1212. Sewage disposal. Information about, R4-28-A1206. Streets. Information about, R4-28-A1207. Subdivision assurances. Completion of improvements, R4-28-A1211. Subsequent owners, R4-28-B1207. Subsidence or expansive soil, R4-28-A1203. Subsidiary corporations. Information required, R4-28-A1201. Superfund site or water quality assurance revolving fund site. Location within, R4-28-A1203. Title reports and encumbrances, R4-28-A1216. Trusts. Information required, R4-28-A1201. Uses of land in vicinity of development, description, R4-28-A1203. Utilities available to development, R4-28-A1204. Water supply. Information about, R4-28-A1205. Blanket encumbrances, R4-28-B1209. Conditional sales exemption, R4-28-B1202. Contiguous parcels acquired by single owner. Classification as single parcels, R4-28-B1205. Correction of errors in report, R4-28-B1208. Earnest money. Deposit by developer, R4-28-B1210. Expedited public report registration, R4-28-B1201. HUD, filing with, R4-28-B1206. Material change information, R4-28-B1203. Membership camping. Applications and amendments, §32-2198.01, R4-28-A1222. Examination of project by commissioner, §32-2198.04. 169 PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION —Cont’d Membership camping —Cont’d Applications and amendments —Cont’d Fees, §32-2198.09. Incompleteness. Grounds for denial, suspension, or revocation of public reports, §32-2198.08. Denial, suspension, or revocation, §32-2198.08. Effect, §32-2198.02. Issuance, §32-2198.02. Misrepresentations concerning, §32-2198.02. Provision to purchasers, §32-2198.02. Sale or offer of contracts, requirements, §32-2198. Options, R4-28-B1209. Receipt. Completion required, form, R4-28-805. Sale or lease of subdivided lands. Change of plan after approval. Amendment, §32-2184. Exemptions from requirement, §32-2181.02. Filing fee. Amendment, §32-2184. Final report, sale of improved lots, §32-2183. Hearing on denial of public report application, §32-2183. Issuance, §32-2183. Lot reservation, exemption, §32-2181.03. Military training route disclosure, §32-2183.05. Suspension, revocation, denial, §32-2183. Sale or lease of unsubdivided lands, §32-2195.03. Commissioner to issue public report, §32-2195. Timeshares. Application, §32-2197.02. Declaration of dedication, contents, §32-2197.06. Contents, §32-2197.08. Denial, suspension, or revocation, §32-2197.08. Hearings, §32-2197.13. False statements, civil liability for, §32-2197.19. Foreign jurisdiction, reports from. Authorization to use, §32-2197.08. Format, §32-2197.08. Issuance, §32-2197.08. Material changes to timeshare plans. Notification, §32-2197.04. INDEX PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION —Cont’d Timeshares —Cont’d Pre-sales of timeshare plans. Proposed public reports provided to purchasers, §32-2197.02. Provision to purchasers, §32-2197.08. Reservations of timeshare interests, §32-2197.10. PUBLIC UTILITIES. Public report. Application. Availability to development, R4-28-A1204. PURCHASE AGREEMENTS. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. R RATIOS. Timeshare plans, §32-2197.01. REAL ESTATE ADVISORY BOARD. Chairperson, §32-2104. Composition of membership, §32-2104. Established, §32-2104. Expenses, reimbursement, §32-2104. Meetings, §32-2105. Number of members, §32-2104. Performance evaluation of commissioner and department. Duty to present to governor, §32-2104. Quorum, §32-2105. Recommendations, duty to provide, §32-2104. Terms of members, §32-2104. Vacancy. Filling, §32-2104. REAL ESTATE BROKERS. Advance payments belonging to others. Depositing in personal account or commingling, prohibition, §32-2151. Bond. Commissioner may require, §32-2193.02. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Cemetery and membership camping salespersons and associate brokers. Employing brokers. Employment without being separately licensed, §32-2125.01. REAL ESTATE BROKERS —Cont’d Cemetery or membership camping sales activities. Licensed broker engaging in, authorization, §32-2125.01. Client ledger. Records requirement, §32-2151. Commingling funds with broker’s own money. Prohibited unless rules allowing adopted, §32-2151. Compensation sharing disclosure, R4-28-701. Computerized records, requirements, §32-2151. Constitutional powers, AZ Const Art 26 §1. Continuing education requirement. Renewal of license, §32-2130, R4-28-402. Defined, §32-2101. Designated brokers. Generally. See DESIGNATED BROKERS. Discipline generally. See BROKERS AND SALESPERSONS. Disclosures in real estate transactions. Information material and adversely affecting consideration, R4-28-1101. Property site of death, owned or occupied by person with AIDS or HIV, or in vicinity of sex offender. Failure to disclose not grounds for termination or rescission, §32-2156. Employing brokers. Cemetery and membership camping salespersons and associate brokers. Employment without being separately licensed, §32-2125.01. Generally. See EMPLOYING BROKERS. Number licensee allowed, categories, §32-2125.01. Employment agreements, §32-2151.02. Group or team. Using terms in advertising, R4-28-502. Instruments incidental to sale or lease of real estate. Right to draft or fill and complete without charge, AZ Const Art 26 §1. Interest or conflict in transaction. Duty to inform other parties, R4-28-1101. Internet web site. Offering of real estate brokerage services by. Activity requiring broker’s license, §32-2163. INDEX REAL ESTATE BROKERS —Cont’d Licensing. Brokers and salespersons generally. Statutes and rules. See BROKERS AND SALESPERSONS. Continuing education requirement. Renewal of license, §32-2130, R4-28-402. Examination, §32-2124. Experience requirement, §32-2124. Renewal of license. Course requirement, §32-2124. Suspension or revocation. See BROKERS AND SALESPERSONS. Loans secured by real property. Collecting compensation for rendering services in negotiating, §32-2155. Money received in connection with transactions. Records, retention, requirements, §32-2151. Mortgage broker services. Compensation for rendering services in negotiating loans secured by real property, §32-2155. Out-of-state brokers. Cooperation agreements with, §32-2163. Payment to and receipt of compensation from, §32-2163. Signs placed on property by. Prohibition, §32-2163. Unlicensed brokers listing, marketing or advertising real estate. Prohibition, §32-2163. Powers. Constitutional provision, AZ Const Art 26 §1. Property management generally. Rental property, §§32-2171 to 32-2176. See PROPERTY MANAGEMENT. Real estate employment agreements, §32-2151.02. Real estate recovery fund, §§32-2186 to 32-2193.02. See REAL ESTATE RECOVERY FUND. Receipts and disbursements journal. Records requirement, §32-2151. Records, requirements, §32-2151. Rejected offers to purchase real property. Evidence of, retention, time period, §32-2151.01. Rental property. Property management generally, §§32-2171 to 32-2176. See PROPERTY MANAGEMENT. REAL ESTATE BROKERS —Cont’d Subdivision lot sales. Assisting subdivider in sales in violation of chapter. Unlawful, §32-2164. Trust fund account. Commingling funds with broker’s own money, prohibited unless rules allowing adopted, §32-2151. Depository located outside state. Agreement to place funds in, §32-2151. Granting nonlicensees authority to withdraw money. Prohibition, §32-2151.01. Placement of entrusted funds in, requirements applicable to account, §32-2151. REAL ESTATE COMMISSIONER. Administration of department, §32-2107. Appeal of final decision, §32-2159. Appointed by governor, §32-2106. Attorney general. Legal advisor and representative of commissioner, §32-2111. Broker, salesperson or agent. Acting as, prohibition, exception, §32-2106. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Cease and desist orders. Authority to issue, hearing, §32-2154. Cemeteries. Actions, recording, §32-2194.07. Advertising. Powers of commissioner, §32-2194.05. Certificate of authority. Issuance or denial, §32-2194.03. Examination, §32-2194.02. Investigations, §32-2194.03. Applicants seeking to transact business, §32-2194.19. Jurisdiction, §32-2194.15. Modifications to cemetery plans, notification, §32-2194.10. Notice of intention to sell property, §32-2194.01. Records. Inspection, §32-2194.06. Violations, powers with regard to, §32-2194.03. Certification and enforcement unit. Establishment, investigative duties, §32-2108. Charge of department, §32-2107. Civil penalties. Authority to assess, action to recover, §32-2160.01. Compensation, §32-2107. Complaint for violation of chapter. Filing, §32-2160. 170 REAL ESTATE COMMISSIONER —Cont’d Consent orders. Authority to grant, §32-2153.01. Denial, suspension or revocation of license, letter of concern, provisional license. Discipline of broker or salesperson. Authority, grounds, §32-2153. Discipline of broker or salesperson. Denial, suspension or revocation of license, letter of concern, provisional license. Authority, grounds, §32-2153. Disclaimer of validity of discriminatory restriction and covenants. Execution and recording, duty, §32-2107.01. Educational products. Producing and circulating, duty, fee charged, §32-2107. Examining books and records of brokers, salespersons or developers. Power in connection with investigation, §32-2108. Exempting corporations from licensing provisions. Power, conditions, §32-2121. Experience required for appointment, §32-2106. Fees collected. Revision annually, §32-2103. Financial interest in brokerage firm. Prohibition, §32-2106. Good moral character of applicant for or holder of license or public report. Additional information to determine. Power to require, §32-2108. Injunctions. Authority of commissioner, §§32-2154, 32-2160. Inspection. Cemeteries. Records, §32-2194.06. Employing broker’s records. Open for, §32-2151.01. Timeshare plans, §32-2197.07. Investigations. Brokers, salespersons or developers. Powers, §32-2108. Timeshares. Violations, §32-2197.14. Jurisdiction retained after lapse, suspension or surrender of license, §32-2153. Licensing of brokers and salespersons. Statutes and rules generally. See BROKERS AND SALESPERSONS. Membership camping. Exemptions from provisions. Fees, §32-2198.09. 171 REAL ESTATE COMMISSIONER —Cont’d Membership camping —Cont’d Exemptions from provisions —Cont’d Granting of petitions, §32-2198.03. Lotteries and drawings. Approval, §32-2198.10. Public reports. Denial, suspension, or revocation, §32-2198.08. Issuance, effect, §32-2198.02. Military airport and ancillary military facility. Increased noise and accident potential disclosure for property located within territory in vicinity of. Duty to execute and record, §32-2113. Military training route. Disclosure for land under. Duty to execute and record, §32-2114. Nonresident broker or salesperson licensees. Appointment of commissioner as agent for accepting service of process, §32-2125.02. Office location, §32-2107. Performance evaluation. Real estate advisory board. Duty to present to governor, §32-2104. Powers and duties, §32-2107. Investigations, information, requiring, §32-2108. Qualifications for appointment, §32-2106. Restitution. Ordering person to make, authority, §32-2154. Rules. Generally. See RULES OF REAL ESTATE DEPARTMENT. Licensing of brokers and salespersons. Statutes and rules generally. See BROKERS AND SALESPERSONS. Power to adopt, §32-2107. Seal, adoption, use, purpose, §32-2107. Secretary, deputies, assistants and clerks. Appointment, power, compensation, §32-2109. Service of process. Nonresident broker or salesperson licensees. Appointment of commissioner as agent for accepting service of process, §32-2125.02. Service by, §32-2158. Standardized legal forms. Power to authorize, §32-2107. INDEX REAL ESTATE COMMISSIONER —Cont’d Subdivided lands. Sales or lease generally. See SUBDIVISIONS. Subpoenas. Issuance in connection with investigation, §32-2108. Timeshares. Advertising and promotional requirements, §32-2197.17. Escrow or trust accounts. Documents, availability, §32-2197.05. Examination of timeshare plans, §32-2197.05. Exemptions. Authority of commissioner to exempt timeshare plans, §32-2197.23. Material changes to timeshare plans, §32-2197.04. Pre-sales authorization, §32-2197.02. Public reports. Foreign jurisdiction, reports from. Authorization to use, §32-2197.08. Issuance, §32-2197.08. Receivers, appointment, §32-2197.15. Recordation of orders, §32-2197.18. Reservation of timeshare interests. Authorization to accept. Denial, revocation or suspension, §32-2197.10. Violations, orders addressing, §32-2197.14. Writ of ne exeat, §32-2197.15. Unsubdivided lands. Sales or lease generally. See UNSUBDIVIDED LANDS. REAL ESTATE DEPARTMENT, §§32-2101 to 32-2119. Action for violation of chapter. Complaints filed by commissioner, §32-2160. Administration of chapter, §32-2102. Appeal of final decision by commissioner, §32-2159. Attorney general. Legal advisor and representative of commissioner, §32-2111. Cease and desist orders. Authority of commissioner to issue, hearing, §32-2154. Certification and enforcement unit. Established by commissioner, investigative duties, §32-2108. Certified copies of records. Evidence, §32-2112. Civil penalties. Authority of commissioner to assess, action to recover, §32-2160.01. REAL ESTATE DEPARTMENT —Cont’d Commissioner. See REAL ESTATE COMMISSIONER. Competition with private enterprise. Prohibition, §32-2118. Complaints filed for violation of chapter. Authority of commissioner, §32-2160. Conflicts of interest. Interest in real estate company or real estate brokerage firm. Employees or officers, prohibition, §32-2110. Corporations. Exemption from licensing provisions. Power of commissioner, conditions, §32-2121. Criminal history records checks. License applicants, §32-2108.01. Definitions, §32-2101. Denial, suspension or revocation of license, letter of concern, provisional license. Discipline of broker or salesperson. Authority of commissioner, grounds, §32-2153. Deposit of money collected. State general fund, §32-2103. Discipline of broker or salesperson. Denial, suspension or revocation of license, letter of concern, provisional license. Authority of commissioner, grounds, §32-2153. Earth fissure maps. Providing and posting on web site, §32-2117. Education revolving fund, §32-2107. Fair housing violations. Department, no jurisdiction over, §32-2160. Fees collected. Revised annually by commissioner, §32-2103. Good moral character of applicant for or holder of license or public report. Additional information to determine. Power of commissioner to require, §32-2108. Injunctions. Authority of commissioner, §32-2154. Inspection of employing broker’s records. Open for inspection by commissioner, §32-2151.01. Interest in real estate company or real estate brokerage firm. Employees or officers, prohibition, §32-2110. INDEX REAL ESTATE DEPARTMENT —Cont’d Investigation of brokers, salespersons or developers. Power of commissioner, §32-2108. Landlord and tenant disputes. Department, no jurisdiction over, §32-2160. Licensing of brokers and salespersons. Statutes and rules generally. See BROKERS AND SALESPERSONS. Military training route contacts. Posting on department’s website, §32-2116. Military training route map. Posted on department’s website, §32-2115. Performance evaluation of department. Real estate advisory board. Duty to present to governor, §32-2104. Purpose in administering chapter, §32-2102. Real estate advisory board, §§32-2104, 32-2105. Restitution. Ordering person to make. Authority of commissioner, §32-2154. Rules. Generally. See RULES OF REAL ESTATE DEPARTMENT. Licensing of brokers and salespersons generally. Statutes and rules. See BROKERS AND SALESPERSONS. Power of commissioner to adopt, §32-2107. Seal, adoption by commissioner, use, purpose, §32-2107. Secretary, deputies, assistants and clerks. Appointment by commissioner, compensation, §32-2109. Standardized legal forms. Power of commissioner to authorize, §32-2107. State general fund. Deposit of money collected, §32-2103. Subpoenas. Issuance in connection with investigation by commissioner, §32-2108. REAL ESTATE DEPARTMENT EDUCATION REVOLVING FUND, §32-2107. REAL ESTATE EMPLOYMENT AGREEMENTS, §32-2151.02. REAL ESTATE RECOVERY FUND, §§32-2186 to 32-2193.02. Actual or direct out of pocket loss to aggrieved person. Payment by fund, §32-2186. REAL ESTATE RECOVERY FUND —Cont’d Appeal. Denial of claim by commissioner, §32-2188.05. Application for payment from fund, §32-2188. Deficiencies, correction, §32-2188.02. Investigation and discovery, §32-2188.03. Notice of claim on judgment debtor. Form, service, time, §32-2188.01. Assets of employing broker. Diligent pursuit. Required prior to filing claim, §32-2188. Assignment of judgment lien and notice of subrogation. Claimant required to sign before payment, §32-2192. Attorney fees and court costs. Payment by fund, §32-2186. Authorized actions by commissioner, §32-2191. Claims for payment from fund. Application, §32-2188. Deficiencies, correction, §32-2188.02. Denial, appeal, §32-2188.05. Final decision and order, time, notice, §32-2188.04. Investigation and discovery. Application for payment from fund, §32-2188.03. Notice of claim on judgment debtor. Form, service, time period, §32-2188.01. Commissioner’s standing in court, §32-2191. Defense of action by department, §32-2188. Deficiencies in application for payment. Correction, §32-2188.02. Definitions, §32-2186. Deposits held in trust, §32-2189. Disciplinary actions against licensees. Authority of commissioner not limited by article, §32-2193.01. Equitable distribution of available money. Fund inadequate to pay in full valid claims, §32-2188. Establishment. Duty of commissioner, §32-2186. Failure to comply with provision. Waiver of aggrieved person’s rights, §32-2193. Insufficient money in fund to satisfy claims, §32-2188. Intervention. Authority of department, §32-2188. Investigation and discovery. Application for payment from fund, §32-2188.03. 172 REAL ESTATE RECOVERY FUND —Cont’d Investment of money, §32-2189. Joinder of actions, §32-2188. Liability limits, §32-2186. Licensee acting as principal or agent. No claim against fund, §32-2186. Limitation of action. Action resulting in order for payment by fund, §32-2188. Application for payment from fund. Filing, §32-2188. Limit on recovery, §32-2186. Management, §32-2189. Notice of appeal. Denial of claim by commissioner, §32-2188.05. Notice of claim on judgment debtor. Form, service, time period, §32-2188.01. Notice of final decision on claim, §32-2188.04. Payments to fund by licensees, §32-2187. Proration proceeding. Fund inadequate to pay in full valid claims, §32-2188. Publication. Service by, §32-2188. Public awareness of fund. Expenditures for, §32-2189. Purpose, §32-2186. Service of process. Alternative methods. Unable to serve licensee personally, §32-2188. Application for payment from fund, §32-2188. Notice of appeal. Denial of claim by commissioner, §32-2188.05. Notice of claim on judgment debtor, time, §32-2188.01. Notice of final decision on claim, §32-2188.04. Statute of limitations. Action resulting in order for payment by fund, §32-2188. Application for payment from fund. Filing, §32-2188. Subrogation to rights of judgment creditor, §32-2192. Surety bond by licensee. Commissioner may require, §32-2193.02. Termination of broker or designated broker. Payment of claim, §32-2188. Unpaid claims. Payment from fund to satisfy, §32-2188. Waiver of aggrieved person’s rights. Failure to comply with provision, §32-2193. 173 REAL ESTATE SALES. Contracts. Defined, §32-2101. Disclosures. Information material and adversely affecting consideration, R4-28-1101. Property site of death, owned or occupied by person with AIDS or HIV, or in vicinity of sex offender. Failure to disclose not grounds for termination or rescission, §32-2156. Subdivided lands, §§32-2181 to 32-2185.09. See SUBDIVISIONS. Unsubdivided lands, §§32-2195 to 32-2195.12. See UNSUBDIVIDED LANDS. REAL ESTATE SALESPERSONS. Brokers and salespersons generally. See BROKERS AND SALESPERSONS. Cemetery or membership camping sales. Licensed broker engaging in, authorization, §32-2125.01. Constitutional powers, AZ Const Art 26 §1. Continuing education requirement. Renewal of license, §32-2130, R4-28-402. Defined, §32-2101. Discipline generally. See BROKERS AND SALESPERSONS. Disclosures in real estate transactions. Information material and adversely affecting consideration, R4-28-1101. Property site of death, owned or occupied by person with AIDS or HIV, or in vicinity of sex offender. Failure to disclose not grounds for termination or rescission, §32-2156. Group or team. Using terms in advertising, R4-28-502. Instruments incidental to sale or lease of real estate. Right to draft or fill and complete without charge, AZ Const Art 26 §1. Interest or conflict in transaction. Duty to inform other parties, R4-28-1101. Licensing. Brokers and salespersons generally. Statutes and rules. See BROKERS AND SALESPERSONS. INDEX REAL ESTATE SALESPERSONS —Cont’d Licensing —Cont’d Continuing education requirement. Renewal of license, §32-2130, R4-28-402. Examination, §32-2124. Real estate contract law and contract writing instruction. Required prior to activation of license, §32-2124. Renewal of license. Course requirement, §32-2124. Suspension or revocation. See BROKERS AND SALESPERSONS. Loans secured by real property. Collecting compensation for rendering services in negotiating, §32-2155. Mortgage broker services. Compensation for rendering services in negotiating loans secured by real property, §32-2155. Powers. Constitutional provision, AZ Const Art 26 §1. Real estate contract law and contract writing instruction. Required prior to activation of license, §32-2124. Real estate recovery fund, §§32-2186 to 32-2193.02. See REAL ESTATE RECOVERY FUND. Subdivision lot sales. Assisting subdivider in sales in violation of chapter. Unlawful, §32-2164. REAL ESTATE SCHOOLS. Advertising, R4-28-502. Certificate of course approval, R4-28-404. Certificate of real estate course attendance. Issuance, §32-2135. Certificate of school approval, R4-28-404. Certification. Approval to operate, course approval, withdrawal or denial, §32-2135, R4-28-404. Change in courses or instructors, R4-28-404. Complaints, R4-28-404. Enrollment agreement or application. Requirements, R4-28-404. Instructor approval, R4-28-404. Job placement services. Advertising, R4-28-404. Prohibited acts, §32-2135. Records of student attending. Requirements, retention, time, R4-28-404. RECEIVERS. Cemeteries. Appointment, §32-2194.03. RECEIVERS —Cont’d Membership camping public reports. Violations. Appointment of receiver, §32-2198.08. Subdivided land sales or leases. Appointment. Unlawful practices, concealing assets, §32-2183. Timeshares. Appointment, §§32-2197.14, 32-2197.15. RECORDATION. Military electronics range. Disclosure of land within, §32-2114.01. Unsubdivided lands. Sale or lease of unsubdivided lands. Recordation of cease and desist orders, §32-2195.12. RECREATIONAL VEHICLE PARK MANAGERS. Inapplicability of broker or salesperson licensing provision, §32-2121. REDEMPTION CERTIFICATES. Timeshares. Tours and presentations, §32-2197.17. REFUNDS. Membership camping contracts. Cancellation, §32-2198.05. Timeshares. Rescission of purchase agreements, §32-2197.05. Reservations of timeshare interests, §32-2197.10. REHEARING. Administrative procedures, R4-28-1310. RELEASES. Real estate brokers and salespersons. Right to draft, fill out and complete, AZ Const Art 26 §1. RENTAL PROPERTY. Managers of residential rental property. Bonus based on performance. When not considered special compensation, §32-2121. Defined, §32-2121. Employment by brokers, §32-2155. Licensing of brokers and salespersons. Exemption from provisions, §32-2121. Property management. Generally, §§32-2171 to 32-2176. See PROPERTY MANAGEMENT. Residential leasing agents. Bonus based on performance. When not considered special compensation, §32-2121. INDEX RENTAL PROPERTY —Cont’d Residential leasing agents —Cont’d Defined, §32-2121. Employment by brokers, §32-2155. Licensing of brokers or salespersons provisions. Exemption from provisions, §32-2121. RESCISSION. Contract language, R4-28-804. Sale or lease of subdivided lands, §32-2183. Sale without permanent access, §32-2185.02. Unimproved lot or parcel, §32-2185.01. Sale or lease of unsubdivided lands, §32-2195.04. RESIDENTIAL LEASING AGENTS. Bonus based on performance. When not considered special compensation, §32-2121. Defined, §32-2121. Employment by brokers, §32-2155. Licensing of brokers or salespersons provisions. Exemption from provisions, §32-2121. RESPONSES. Administrative procedures, R4-28-1304. RESTITUTION. Real estate commissioner. Ordering person to make, authority, §32-2154. RESTRICTIONS. Discriminatory restrictions and covenants. Disclaimer of validity. Real estate commissioner, duty to execute and record, §32-2107.01. RETIREMENT COMMUNITY. Subdivider’s promise of exclusive use for. Inclusion in deed restrictions, §32-2181. RULE AGAINST PERPETUITIES. Cemeteries. Inapplicability, §32-2194.23. RULES OF REAL ESTATE DEPARTMENT. Administrative procedures. Admissions. Allegations not denied admitted, R4-28-1304. Correction of clerical mistakes, R4-28-1313. Default. Failure to file response, R4-28-1304. Notice of appearance of counsel, R4-28-1305. RULES OF REAL ESTATE DEPARTMENT —Cont’d Administrative procedures —Cont’d Person filing pleading or brief with department. Filing with attorney general, R4-28-1303. Rehearing or review of decision, R4-28-1310. Responses, R4-28-1304. Service of pleadings subsequent to complaint and notice, R4-28-1302. Advertising. Development, R4-28-504. Licensees, R4-28-502. Promotional activities, R4-28-503. Cemetery notice, R4-28-B1204. Compensation sharing disclosure, R4-28-701. Computation of time, R4-28-102. Conditional sales exemption, R4-28-B1202. Contiguous parcels acquired by single owner. Classification as single parcels, R4-28-B1205. Definitions, R4-28-101. Developers. Record requirements. Sale or lease of property without services of broker, R4-28-B1211. Development inspection fee, R4-28-104. Documents. Contract disclosures, R4-28-803. Conveyance documents, R4-28-802. Rescission of contract. Contract language, R4-28-804. Duties of licensee to client, R4-28-1101. Earnest money. Deposit by developer, R4-28-B1210. Fees. Development inspection fee, R4-28-104. Filing documents. When considered file, timely filing, R4-28-102. HUD. Filing with, R4-28-B1206. Licensure. Branch office, branch office manager, R4-28-304. Business Brokerage Specialist designation, R4-28-405. Continuing education requirements, R4-28-402. Examination, R4-28-403. Information required, R4-28-302. Prelicensure education requirement, R4-28-401. Renewal, reinstatement, license changes, R4-28-303. Requirements generally, R4-28-301. 174 RULES OF REAL ESTATE DEPARTMENT —Cont’d Licensure —Cont’d Temporary license or certificate of convenience, R4-28-305. Timeframes, R4-28-103. Unlawful license activity, R4-28-306. Material change, R4-28-B1203. Property negotiations by licensees, R4-28-1102. Public report, certificate of authority or general order of exemption. See PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. Public report receipt, R4-28-805. Real estate schools, R4-28-404. Subdivisions. Expedited registration for improved subdivision lots, R4-28-B1201. Supervision and control. Employing brokers and designated brokers, R4-28-1103. Unsubdivided lands. Expedited registration, R4-28-B1201. S SALE OR LEASE OF SUBDIVIDED LANDS. Generally, §§32-2181 to 32-2185.09. See SUBDIVISIONS. SALE OR LEASE OF UNSUBDIVIDED LANDS, §§32-2195 to 32-2195.12. See UNSUBDIVIDED LANDS. SALESPERSONS. Generally. See BROKERS AND SALESPERSONS. SALES TRANSACTION FOLDERS. Content requirements, §32-2151.01. SCHOOLS. Public report. Application. Information about, R4-28-A1212. Real estate schools, §32-2135. Advertising, R4-28-502. Certificate of course approval, R4-28-404. Certificate of school approval, R4-28-404. Change in courses or instructors, R4-28-404. Complaints, R4-28-404. Enrollment agreement or application. Requirements, R4-28-404. Instructor approval, R4-28-404. 175 SCHOOLS —Cont’d Real estate schools —Cont’d Job placement services. Advertising, R4-28-404. Records of student attending. Requirements, retention, time, R4-28-404. SEAL OF REAL ESTATE COMMISSIONER. Adoption, use, purpose, §32-2107. SERVICE OF PROCESS. Administrative procedure. Pleadings subsequent to complaint and notice, R4-28-1302. Cemeteries. Notice of appointment of receiver or writ of ne exeat, §32-2194.03. Condominium recovery fund. Appeal of denial, §32-2193.39. Service of process on subdivider, §32-2193.34. Nonresident brokers and salespersons, §32-2125.02. Appointment of commissioner as agent or attorney in fact for acceptance, §32-2125.02. Real estate commissioner. Agent for service of process, appointment. Nonresident broker or salesperson licensees, §32-2125.02. Membership camping. Receivers, orders appointing, §32-2198.08. Service by, §32-2158. Real estate recovery fund. Alternative methods. Unable to serve licensee personally, §32-2188. Application for payment from fund, §32-2188. Notice of appeal. Denial of claim by commissioner, §32-2188.05. Notice of claim on judgment debtor, time, §32-2188.01. Notice of final decision on claim, §32-2188.04. Timeshares. Receivers, orders appointing, §32-2197.15. SEWAGE DISPOSAL. Public report. Application. Information about, R4-28-A1206. SEX OFFENDERS. Property subject to transfer located in vicinity of. Failure to disclose not grounds for termination or rescission, §32-2156. SHOPPING. Public report. Application. Information about services, R4-28-A1212. INDEX SIGNS. Cemeteries, §32-2194.29. Displayed at broker’s place of business, §32-2126. Out-of-state brokers. Placing on property prohibited, §32-2163. SOCIAL SECURITY NUMBER. Application for broker or salesperson license. Information required, §32-2123. Confidentiality of broker or salesperson licensee’s number, §32-2125.03. SPECULATION. Sales of cemetery property for, §32-2162. STATUTE OF LIMITATIONS. Cemeteries. Purchasers. Action to void sale, §32-2194.03. Violations, civil liabilities, §32-2194.09. Real estate recovery fund. Action resulting in order for payment by fund, §32-2188. Application for payment from fund. Filing, §32-2188. Sale or lease of subdivided lands. Action for violations, §32-2183.03. Action to rescind, §32-2183. Civil penalty, imposition, suspension or revocation of license, §32-2185.09. Sale or lease of unsubdivided lands. Action to void transaction, §32-2195.03. Suit for unlawful sales or leases, §32-2195.06. Timeshares. Fraudulent practices, §32-2197.19. Rescission of the sale or lease of timeshare interests, actions for, §32-2197.09. STOCK COOPERATIVE. Defined, §32-2101. STOCKHOLDERS. Membership camping operators. Public report applications, §32-2198.01. STREETS. Public report. Application. Information about, R4-28-A1207. SUBDIVISIONS. Access to subdivided land. Permanent access, §32-2185.02. Defined, §32-2101. Acting in concert to avoid chapter’s provisions. Unlawful, §32-2181. Action for imposition of civil penalty or suspension or revocation of license. Limitation of action, §32-2185.09. SUBDIVISIONS —Cont’d Actions by commissioner. Recording, §32-2183.02. Actions for violation, §32-2183.03. Action to rescind sale or lease. Limitation period, attorney fees, §32-2183. Adult or senior citizen residency. Subdivider’s promise. Inclusion in deed restrictions, §32-2181. Advertising development, R4-28-504. Advertising material, filing with commissioner, prohibitions, §32-2183.01. Attorneys’ fees. Action for violations, §32-2183.03. Action to rescind sale or lease, §32-2183. Blanket encumbrance. Sale of property subject to. Unlawful, exception, §32-2185. Change of subdivision after approval. Notice, amendment of public report, cancellation of contract, filing fee, §32-2184. Civil penalties, §32-2185.09. Assessment, action to recover, §32-2160.01. Clear title. Delivery on performance of contract, §32-2185. Condominium project not completed by subdivider. Condominium recovery fund, §§32-2193.31 to 32-2193.43. Contiguous parcels acquired by single owner. Classification as single parcels, R4-28-B1205. Contracts for sale or lease of property in development. Disclosures, R4-28-803. Copy of contract in recordable form. Each purchaser provided, §32-2185.08. Damages. Action for unlawful sales and practices, §32-2183.03. Defined, §32-2101. Disclaimer or waiver of personal liability. Prior material misrepresentations, §32-2185.06. Disclosures. Required disclosures in contracts, §32-2185.06, R4-28-803. Drawings or contests to induce prospective buyers to visit, §32-2183.01. Earnest money. Deposit by developer, R4-28-B1210. Examination of subdivision offered for sale or lease, §32-2182. INDEX SUBDIVISIONS —Cont’d Exception from notification requirements, §32-2181. Exceptions to provisions, §32-2181. Exemptions from provisions, §32-2181.02. Special order of commissioner, §32-2181.01. False statements or publications. Criminal penalty, §32-2161. Filing fee, §32-2182. Amendment of public report, §32-2184. Fraud, §32-2183.01. Groundwater active management area. Certificate of assured water supply, §32-2181. Required for issuance of public report, §32-2183. Hearing on denial of public report application, §32-2183. Improved lot or parcel. Defined, §32-2101. Improvements, completion. Required for lawful sales, §32-2183. Inspection of lot or parcel by purchaser. Unimproved lots or parcels subject of sale or lease, §32-2185.01. Inspection of subdivision site, §32-2182. Development inspection fee, R4-28-104. Investigation by commissioner. Unlawful practices, §32-2183. Jurisdiction of commissioner, §32-2185.07. Limitation of action. Action for imposition of civil penalty or suspension or revocation of license, §32-2185.09. Action for violations, §32-2183.03. Action to rescind sale or lease, §32-2183. Lot reservations. Accepting, §32-2181.03. Cancellation by prospective buyer, §32-2181.03. Denial of authorization to accept, §32-2181.03. Exemption from notice and public report requirements, §32-2181.03. Expiration of authority to take, §32-2181.03. Notice of intent to accept, §32-2181.03. Requirements, §32-2181.03. Reservation deposit, amount, limitation, §32-2181.03. Statement required, §32-2181.03. Termination. Refund to prospective buyer, §32-2181.03. Transfer of rights, §32-2181.03. SUBDIVISIONS —Cont’d Lottery or drawing. Application for approval, R4-28-503. Master planned community. Defined, §32-2101. Military airport and ancillary military facility. Lots located within territory in vicinity. Statement required in public report, §32-2183. Military training route. Property located under. Disclosure, §32-2183.05. Statement required in public report, §32-2183. Minimum number of lots, parcels or fractional interest subjecting subdivider to chapter, §32-2181. Misrepresentation, §32-2183.01. Notice of intention to subdivide lands for sale or lease, §32-2181. Exemptions, §32-2181.02. False statements, action for, §32-2183.01. Lot reservation, exemption, §32-2181.03. Notice of intent to accept lot reservations, §32-2181.03. Permanent access. Defined, §32-2101. Public report authorizing sale or lease. Amendment. Change of plan after approval, §32-2184. Change of plan after approval. Amendment, §32-2184. Exemptions generally, §32-2181.02. Fees. Amendment, §32-2184. Final report, sale of improved lots, §32-2183. Generally. See PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. Hearing on denial of public report application, §32-2183. Issuance, §32-2183. Lot reservation, exemption, §32-2181.03. Military training route disclosure, §32-2183.05. Receipt. Completion by developer required, form, R4-28-805. Suspension, revocation, denial, §32-2183. Real estate brokers and salespersons. Assisting subdivider in sales in violation of chapter. Unlawful, §32-2164. 176 SUBDIVISIONS —Cont’d Receiver of assets. Appointment. Unlawful practices, concealing assets, §32-2183. Recording actions by commissioner, §32-2183.02. Rescission of sales or leases. Sale or lease of unimproved lot or parcel, §32-2185.01. Sale or lease prior to issuance of public report, action for, limitation period, attorney fees, §32-2183. Sale without permanent access, §32-2185.02. Restricted air space. Subdivider’s report. Disclosures, §32-2183.06. Retirement community. Promise of exclusive use for. Inclusion in deed restrictions, §32-2181. Sale or lease of subdivided lands. Notice. Cease or desist orders, §32-2183.02. Sales and promotional literature. Filing, requirements, prohibitions, §32-2183.01. Special order exempting subdivisions, §32-2181.01. State general fund. Deposit of fees and earned expense in, §32-2185.03. Subdivided lands defined, §32-2101. Subdivider defined, §32-2101. Surety bond by subdivider, §32-2183.04. Unimproved lots or parcels. Defined, §32-2101. Sales, requirements, §32-2185.01. Unlawful practices, §32-2183.01. Action for, §32-2183.03. Civil penalties, §32-2185.09. Investigation by commissioner, §32-2183. Unlawful sales, §§32-2183, 32-2183.01. Action for, §32-2183.03. Real estate brokers and salespersons. Assisting subdivider in sales in violation of chapter, §32-2164. Unsubdivided lands. Sale or lease generally, §§32-2195 to 32-2195.12. See UNSUBDIVIDED LANDS. Water supply. Certificate of assured water supply. Lands within groundwater active management area, §32-2181. Required for issuance of public report, §32-2183. 177 SUBDIVISIONS —Cont’d Water supply —Cont’d Inadequate on-site supply, report by director of water resources. Inclusion in promotional material and contracts, §32-2181. Zoning changes, building permits or other officials acts. Party’s right to appear and testify in support or opposition. Instrument of transfer may not limit, §32-2181. SUBPOENAS. Real estate commissioner. Issuance in connection with investigation, §32-2108. SUBROGATION TO RIGHTS OF JUDGMENT CREDITOR. Real estate recovery fund, §32-2192. SUICIDE ON PROPERTY SUBJECT TO TRANSFER. Failure to disclose not grounds for termination or rescission, §32-2156. SUMMARY ORDERS. Cemeteries. Powers of real estate commissioner, §32-2194.03. Membership camping public reports. Denial, suspension, or revocation, §32-2198.08. Timeshares. Investigations by real estate commissioner, §32-2197.14. SUMMARY SUSPENSION OF LICENSE. Brokers and salespersons, §32-2157. SUPERFUND SITE. Public report. Application. Development located within, R4-28-A1203. SURETY BOND BY SUBDIVIDER, §32-2183.04. T TAXATION. Membership camping public reports. Applications, §32-2198.01. TELEMARKETING. Employee of broker performing services. Inapplicability of licensing provision, §32-2121. Timeshare promotion, §32-2197.17. INDEX TELEPHONE NUMBER OF BROKER OR SALESPERSON LICENSEE. Confidentiality of home phone number. Signed statement requesting, §32-2125.03. TELEPHONE SERVICE. Public report. Application. Utilities available to development, R4-28-A1204. TEMPORARY LICENSES. Broker’s license, §32-2133. Cemetery salesperson’s license, §32-2134. Fees, §32-2132. Information required, R4-28-305. TIMESHARES. Advertising and promotional requirements, §32-2197.17. Applicability of article, §32-2197.24. Closing, §32-2197.03. Provision of information to purchasers beforehand, §32-2197.08. Supervisory duties of developers, §32-2197.11. Contract language. Rescission of contract, R4-28-804. Creation of timeshare plans, §32-2197.01. Declaration of dedication. Contents, §32-2197.06. Public report applications, inclusion with, §32-2197.02. Definitions, §§32-2101, 32-2197. Finder fee, §32-2197.21. Principal, §32-2197.02. Developers. Advertising and promotional requirements, §32-2197.17. Civil liabilities, §32-2197.19. Defined, §32-2197. Drawings or contests, §32-2197.17. Expenses paid by. Examination of plan, §32-2197.07. Investigations, §32-2197.14. Finder fees, §32-2197.21. Penalties, civil, §32-2197.20. Pre-sales, §32-2197.02. Public reports. Application, contents, §32-2197.02. Issuance and provision to purchasers, §32-2197.08. Purchase agreements. Money received. Escrow or trust accounts, deposit into, §32-2197.05. Release, §32-2197.12. Supervisory duties, §32-2197.11. Exemption for telemarketing, §32-2197.17. Tours and presentations, §32-2197.17. TIMESHARES —Cont’d Drawings or contests, §32-2197.17. Application for approval, R4-28-503. Encumbrances and liens, §32-2197.12. Escrow or trust accounts. Deposit of money received during rescission or construction period, §32-2197.05. Release of money deposited. Encumbrances and liens, §32-2197.12. Examination of timeshare plans by commissioner, §32-2197.07. Exemptions, §32-2197.22. Authority of commissioner to exempt timeshare plans, §32-2197.23. Fees, §32-2197.07. Exemption of timeshare plans, petitions for, §32-2197.23. Finder fees, §32-2197.21. Fraudulent practices, civil liabilities for, §32-2197.19. Investigations of violations by real estate commissioner, §32-2197.14. Notice. Intent to sell, §32-2197.02. False statements, civil liabilities for, §32-2197.19. Material changes to timeshare plans, §32-2197.04. Receivers, appointment, §32-2197.15. Rescission of purchase agreements, §32-2197.03. Reservations of timeshare interests. Intent to accept, §32-2197.10. Public report, denial of application, §32-2197.10. Termination, §32-2197.10. Writ of ne exeat, §32-2197.15. Orders addressing violations, §32-2197.14. Penalties, civil, §32-2197.20. Policies and procedures applicable to specific properties. Declarations of dedication, §32-2197.06. Pre-sales. Authorization, §32-2197.02. Timeshare interests, §32-2197.09. Cancellation of purchase agreements, §32-2197.02. Public report. Application, §32-2197.02. Declaration of dedication, contents, §32-2197.06. Contents, §32-2197.08. Denial, suspension, or revocation, §32-2197.08. Hearings, §32-2197.13. INDEX TIMESHARES —Cont’d Public report —Cont’d False statements, civil liability for, §32-2197.19. Foreign jurisdiction, reports from. Authorization to use, §32-2197.08. Format, §32-2197.08. Generally. See PUBLIC REPORT, CERTIFICATE OF AUTHORITY OR GENERAL ORDER OF EXEMPTION. Issuance, §32-2197.08. Material changes to timeshare plans. Notification, §32-2197.04. Pre-sales of timeshare plans. Proposed public reports provided to purchasers, §32-2197.02. Provision to purchasers, §32-2197.08. Reservations of timeshare interests, §32-2197.10. Purchase agreements. Rescission, §32-2197.03. Escrow or trust accounts for money received during rescission or construction period, §32-2197.05. Pre-sales cancellation, §32-2197.02. Reservations of timeshare interests, §32-2197.10. Supervisory duties of developers, §32-2197.11. Ratios for timeshare plans, §32-2197.01. Recordation of orders, §32-2197.18. Rescission of contract. Contract language, R4-28-804. Reservations of timeshare interests, §32-2197.10. Sale or lease of timeshare interests. Public report or pre-sale authorization required, §32-2197.09. Rescission, §32-2197.09. Telemarketing, §32-2197.17. Tours and presentations, §32-2197.17. Violations, civil liabilities, §32-2197.19. TITLE REPORTS. Membership camping. Public reports, applications, §32-2198.01. Timeshares. Public reports, applications, §32-2197.02. TRADE NAMES. Advertising by brokers using, R4-28-502. TRANSPORTATION. Public report. Application. Information about services, R4-28-A1212. TRUST ACCOUNTS. Nonresident brokers and salespersons. Broker maintaining office in state, R4-28-302. Property management accounts, §32-2174. Real estate brokers. Trust fund account. Commingling funds with broker’s own money, prohibited unless rules allowing adopted, §32-2151. Depository located outside state. Agreement to place funds in, §32-2151. Granting nonlicensees authority to withdraw money. Prohibition, §32-2151.01. Placement of entrusted funds in, requirements applicable to account, §32-2151. Timeshares. Rescission or construction period, money received during, §32-2197.05. Reservations of timeshare interests, §32-2197.10. TRUST AGREEMENT. Public report. Application. Assurances for completion, R4-28-A1211. TRUST FUNDS. Cemeteries. Advertising. Prerequisites, §32-2194.25. Certificate of authority. Prerequisites, §32-2194.24. TRUSTS. Public report. Application. Information required, R4-28-A1201. U UNLICENSED PERSONS. Broker employing or paying. Unlawful, §§32-2155, 32-2163. Criminal penalties. Performing acts or activities requiring license, §32-2165. Information required by. Persons conducting activities requiring license, R4-28-303. UNSUBDIVIDED LANDS, §§32-2195 to 32-2195.12. Access to property. Permanent access required, §32-2195. 178 UNSUBDIVIDED LANDS —Cont’d Action to void transaction. Sales or lease before public report issued. Limitation of action, §32-2195.03. Advertising material, §32-2195.05. Attachment to notice of intent, §32-2195. Attorneys’ fees. Action to void transaction, §32-2195.03. Suit for unlawful sales or leases, §32-2195.06. Authorization of commissioner. Required for sale or lease, §32-2195. Change of plan after approval. Notice required, suspension of approval pending public report amendment, §32-2195.10. Civil liabilities for violations, §32-2195.06. Damages. Suit for unlawful sales or leases, §32-2195.06. Defined, §32-2101. Denial of issuance of public report, §32-2195.03. Examination of lands offered for sale or lease. Power of commissioner, fee, §32-2195.02. Exemption of land by special order. Power of commissioner, §32-2195.01. False statements or omissions. Civil liabilities for violations, §32-2195.06. Filing fee, §32-2195.02. Final public report. Preparation by owner, §32-2195.03. Fraud, §32-2195.06. Homesites or building sites. Statements that property suitable for, requirements, §32-2195.05. Investigation of project and examination of books and records, §32-2195.03. Jurisdiction of commissioner, §32-2195.07. Limitation of action. Action to void transaction. Sales or lease before public report issued, §32-2195.03. Suit for unlawful sales or leases, §32-2195.06. Military airport and ancillary military facility. Statement in public report. Land located within territory in vicinity of airport, §32-2195.03. Notice on intention to offer lands for sale or lease, §32-2195. False statements or omissions. Civil liabilities for violations, §32-2195.06. 179 UNSUBDIVIDED LANDS —Cont’d Promotional materials, §32-2195.05. Attachment to notice of intent, §32-2195. Public report, §32-2195.03. Commissioner to issue, §32-2195. False statements or omissions. Civil liabilities for violations, §32-2195.06. Recordable forms of contracts. Purchaser provided copies, §32-2195.09. Recording of documents, §32-2195.04. Requirements to sale or lease lands, §32-2195.04. Rescission of contract of purchase or lease, §32-2195.04. Contract language, R4-28-804. Sale or lease. Notice of cease and desist orders, §32-2195.12. Recording and notice of cease and desist orders, §32-2195.12. Special order exempting land, §32-2195.01. Statute of limitations. Action to void transaction. Sales or lease before public report issued, §32-2195.03. Suit for unlawful sales or leases, §32-2195.06. Suspension of approval. Change of plan after approval. Pending amendment to public report, §32-2195.10. INDEX UNSUBDIVIDED LANDS —Cont’d Termination of authorization issued, §32-2195. Unlawful sales, §§32-2195, 32-2195.06. Voidable sales or leases. Sales or lease before public report issued, §32-2195.03. Water availability report issued. Display on promotional materials and contracts, §32-2195. Zoning hearings, hearings on issuance of building permits, other official acts. Restricting person’s right to appear and testify. Prohibition, §32-2195. UTILITIES. Public report. Application. Availability to development, R4-28-A1204. W WATER QUALITY ASSURANCE REVOLVING FUND SITE. Public report. Application. Development located within, R4-28-A1203. WATER SUPPLY. Public report. Application. Information about, R4-28-A1205. WATER SUPPLY —Cont’d Sale or lease of unsubdivided lands. Water availability report issued. Display on promotional materials and contracts, §32-2195. Subdivided lands with inadequate on-site supply. Report by director of water resources. Inclusion in promotional material and contracts, §32-2181. Subdivided lands within groundwater active management area. Certificate of assured water supply, §32-2181. Required for issuance of public report, §32-2183. WEBSITE. Advertising the offering of property interests, R4-28-502. WITNESSES. Right of party to hearing. Attendance of witnesses in party’s behalf, §32-2158. WRIT OF NE EXEAT. Cemeteries, §32-2194.03. Membership camping public reports. Denial, suspension, or revocation, §32-2198.08. Timeshares, §32-2197.15. Notes