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Practice Of Real EstateLicense LawHARD

Kevin holds a South Dakota salesperson license sponsored by Broker Alice. Kevin decides to leave Alice's brokerage and join Broker David's firm. Kevin submits a transfer request to the South Dakota Real Estate Commission. Under SDCL Chapter 36-21A, which of the following statements correctly describes Kevin's license status during the period between Alice releasing his license and David's affiliation paperwork being approved by the SDREC?

Correct Answer

A) Kevin's license reverts to inactive status upon release from Alice's sponsorship, and he may not engage in licensed activity until the SDREC approves the affiliation with David.

Under SDCL 36-21A, when a salesperson's sponsoring broker releases the license, the license immediately reverts to inactive status. The salesperson may not engage in any activity requiring a real estate license until the new sponsoring broker's affiliation is formally approved by the SDREC. This protects the public by ensuring no licensee operates without proper broker supervision during a transition period.

Answer Options
A
Kevin's license reverts to inactive status upon release from Alice's sponsorship, and he may not engage in licensed activity until the SDREC approves the affiliation with David.
B
Kevin may continue practicing real estate independently for up to 30 days while the transfer is pending, without requiring sponsorship from either broker.
C
Kevin's license remains active under Alice's sponsorship until David's paperwork is formally approved by the SDREC.
D
Kevin's license automatically transfers to David's brokerage upon submission of the transfer paperwork, allowing Kevin to practice under David immediately.

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Related Topics & Key Terms

Key Terms:

license_transferbroker_affiliationinactive_licensesdcl_36_21a

Related Concepts

License requirements are the mandatory qualifications—including pre-licensing education, examination, and background checks—that a person must satisfy before legally practicing real estate. These requirements are established and enforced by each state's real estate commission.

Market allocation is an illegal antitrust practice in which competing real estate brokerages agree to divide markets among themselves by geographic area, property type, or price range, thereby eliminating competition.

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.

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