D.R. Legal News discusses 5 legal case studies for IAR managing brokers

The United States Supreme Court’s ruling that a professional licensing board was not immune from an anti-trust violation was just one of five legal case studies reviewed in the May edition of the D.R. Legal News.

Lisa Harms Hartzler, Sorling Northrup Attorneys, writes about the five cases for the Illinois Association of REALTORS®. The cases concluded that:

  • an auction company did not have an obligation to supply an Illinois Residential Real Property Disclosure Act form to a trustee for delivery to a successful bidder;
  • a California broker could not list Nebraska properties on the Internet;
  • liability insurance was not applicable to cover a real estate broker in a claim of negligent supervision; and
  • a plaintiff could not challenge rezoning of property without strictly following the Illinois Municipal Code.

D.R. Legal News is an e-newsletter published six times a year with targeted legal, market and management information for Illinois broker managers and designated REALTORS®.

REALTORS® get legal updates from Urbance, Baker

Betsy Urbance and Jeffrey Baker

The integration of TILA/RESPA, case summaries, the REALTOR® Code of Ethics Citation Program, social media and team names in advertising, drones and surveillance were among the topics reviewed by the Legal Services team of Betsy Urbance and Jeffrey T. Baker Wednesday at the IAR Spring Conference in Collinsville.

Baker reviewed many of the points covered in Tuesday’s joint TILA/RESPA webinar with the Illinois Bankers’ Association.  He noted the changes were intended to eliminate confusing language and forms used in financed real estate transactions.

Baker also said brokers can expect some delays at closings as banks continue to adjust to the new rules. Because banks are just absorbing the changes, software companies are still working on changes to loan forms. The new rules go in effect Aug. 1, but it remains to be seen if the bank software will be ready by then.

Baker said members should expect fewer closings per day as the new rule becomes operational and closing windows in general will likely be longer. Brokers should prepare clients for closings seven to 10 days in advance, he said, to accommodate for the new rule changes.

Urbance moved quickly through a variety of topics, including the importance of REALTORS® following the Code of Ethics and License Law when using social media for any part of their business. Regarding drones, she advised members not to use them unless a waiver is secured from the FAA. There is a risk that liability insurers would not cover damages caused by a drone being flown in contravention of federal laws.

Explaining the Cook County(unincorporated) Zoning Use Certificate Ordinance

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For those members practicing in areas which include unincorporated Cook County, take note that effective March 21, 2015 a new application procedure became effective for sellers of real property.

The ordinance requires sellers of property to apply for a Zoning Use Certificate when the property goes under contract for sale. Sellers are required to complete an application form [http://www.cookcountyil.gov/building-and-zoning/] and pay a $100 fee seeking a Zoning Use Certificate.

The Cook County Zoning Administrator will either issue or deny the certificate. If denied, the Administrator will state the reasons for denial. The stated goal of this requirement is to prevent surprises to buyers that might limit their ability to use the property for the buyer’s intended purpose. Individual units in condominium and co-op buildings are exempt from this requirement.

Definitions in the ordinance speak to the seller or the “seller’s agent,” which, depending upon the facts, could be our members. However, the Illinois Association of REALTORS®’ Legal Team recommends that licensees not complete the form, but make sure that the seller or his “legal” agent, i.e. his attorney-at-law or attorney-in-fact (power of attorney) complete the form since the seller is asked to make certain representations about the property that the real estate broker may or may not know.

It is important for our members to be aware of this new requirement so that they can be an information source for their clients. Brokers can direct their clients to the form and to their attorneys if the seller has any concerns about providing the information and answering the questions on the application form.

D.R. Legal News discusses licensed agents as independent contractors

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Unresolved court cases in California and Massachusetts have a remote chance to affect whether licensed real estate agents in Illinois will be classified as independent contractors or employees, according to the May issue of D.R. Legal News for managing brokers.

John Kauerauf, Sorling Northrup Attorneys, writes that if real estate agents win any of the three cases cited, copycat cases will probably occur around the country, though Illinois has a regulatory environment that is conducive to the broker/independent contractor relationship.

The likelihood of Illinois licensees losing their status as independent contractors appears remote,  Kauerauf states. He lists seven essential features of the independent contractor relationship. He cautions brokers to develop written contracts for these relationships and model these features.

See his list at the end of the D.R. Legal News story: “Classification of licensees and independent contractors: Is there a storm on the horizon?”

D.R. Legal News is an e-newsletter published six times a year with targeted legal, market and management information for Illinois broker managers and designated REALTORS®.

IAR members can download today’s legal webinar

Betsy Urbance

Keep yourself informed about a variety of legal issues – including a recent law affecting sellers of residential properties in unincorporated Cook County – by listening to today’s IAR Legal Webinar, titled “You Need to Know: Fair Housing and Rentals/Property Management.”

Members can log in and download a copy of the webinar or listen to an audio-only version.

Jeffrey Baker

The webinar was hosted by IAR Legal Hotline Attorney Betsy Urbance and IAR Transaction Helpline Attorney Jeffrey T. Baker.

For a list of previous webinars, members can log in and check the IAR Legal Webinar archives.