Broker Wilson is the designated broker of record for a Michigan real estate firm. He discovers that one of his affiliated salespersons, Kim, has been operating a separate, unlicensed property management side business, collecting fees from landlords without the broker's knowledge. Under Michigan law, which of the following best describes the consequences Wilson and Kim may face?
Correct Answer
A) Kim faces disciplinary action for unlicensed activity; Wilson may also face discipline for failure to supervise, and Kim's unlicensed fees may be unrecoverable
Under MCL 339.2501 and MCL 339.2604, conducting real estate activities (including property management for compensation) without a license is a violation of the Michigan Occupational Code. Kim faces disciplinary action and potentially civil penalties. Wilson, as the broker of record with a supervisory duty, may also face discipline for failing to adequately supervise Kim's activities. Additionally, under Michigan law, unlicensed persons generally cannot enforce commission or fee agreements in court, making Kim's collected fees potentially unrecoverable if challenged.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Price fixing is an illegal antitrust practice in which competing real estate brokerages agree to charge the same commission rates, fees, or other pricing for their services. It is a per se violation of the Sherman Antitrust Act.
Florida brokers are required to maintain transaction records and escrow records for a minimum of five years.
A tie-in arrangement is an illegal antitrust practice in which a seller conditions the purchase of one product or service on the buyer's agreement to purchase a separate product or service.
More Practice Of Real Estate Questions
In Wyoming real estate practice, an associate broker or salesperson is not associated with a responsible broker at renewal. What should the licensee remember?
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A Wyoming licensee is reviewing an out-of-state salesperson applicant prepares for testing. What is the best answer?
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