Colorado Association of Realtors: CAR Attorney Testifies at Pre-Hearing

On January 25th, CAR General Counsel, Scott Peterson testified at the pre-hearing on the Division of Real Estate Sunset before the Senate Business, Labor, and Technology Committee. This pre-hearing was an opportunity for the committee to hear from the Department of Regulatory Agencies’ Policy Analyst and stakeholders on the DORA Sunset Report. Peterson shared CAR’s comments on the report, explaining that CAR believes the Division and Commission should be continued and continue to regulate licensees.

Peterson also informed the committee of our support for Recommendations 4, 5, and 7, which would increase the qualifications necessary to become an employing broker (4), amend state statutes dealing with referral fees to conform with RESPA (5), and revise license renewal dates from anniversary dates to December 31 of each year (7).

However, CAR strongly disagreed with Recommendation 2, related to “standard forms”, which is troublesome for members. Removing “standard” and “including those” language is inconsistent with established legal precedent stemming from the Conway-Bogue case that has defined the practice of real estate brokers for the past sixty years. In this case, the Colorado Supreme Court determined that when a broker fills out a form given to them by their clients, it does not constitute unauthorized practice of law.

If this ruling were changed by the Sunset recommendation a real estate licensee would only be able to complete forms that are promulgated by the Real Estate Commission and any other form, no matter how innocuous, would need to be prepared by an attorney. These simple tasks could include filling in the parties on a lease or completing a builder’s new construction contract with the sale price and closing date.

Finally, CAR also addressed Recommendation 9 at the pre-hearing. CAR informed the committee that requiring the Commission to develop guidelines for the annual commission update course instead of developing the course itself will curtail the supply of instructors, and thereby restrict the availability of course offerings. It would also overburden the Division who would need to not only develop the guidelines but also approve, police and audit the classes developed by the instructors.

The Senate Business, Labor, and Technology Committee will take these comments from stakeholders and the DORA policy analyst into consideration in drafting a bill. That bill will be calendared for future hearings in committee and follow the regular legislative process.

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