A consumer named Patricia obtained a court judgment against a licensed Alabama broker for $75,000 due to the broker's fraudulent conduct in a single real estate transaction. Patricia then applies to the Alabama Real Estate Recovery Fund for compensation. What is the maximum amount Patricia can recover from the Recovery Fund for this single transaction?
Correct Answer
B) $50,000
Under Code of Alabama §34-27-31, the Alabama Real Estate Recovery Fund pays a maximum of $50,000 per transaction, regardless of the actual judgment amount. Even though Patricia's court judgment is $75,000, the Recovery Fund will only compensate her up to $50,000 for this single transaction. She must first have obtained an unsatisfied court judgment before applying to the Fund.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A trust account, also called an escrow account, is a separate bank account maintained by a broker to hold funds belonging to others, such as earnest money deposits, security deposits, or other client funds.
Advertising regulations govern how real estate licensees may market properties and services, requiring truthful, non-deceptive advertising that includes proper identification of the brokerage.
Antitrust violations in real estate occur when competing brokerages or agents engage in practices that restrain trade, reduce competition, or harm consumers through collusion. These violations are governed by the Sherman Antitrust Act and can result in severe penalties.
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