For those who have not heard of this by now, there is a new law (California Sentate Bill 510 which adds sections 10164 and 10165 to the Business and Professions code in California) which allows a California real estate broker to appoint a real estate licensee to be a branch office or division manager. There are limitations as to who can become a branch manager. For example, you cannot appoint a real estate licensee to be a branhc manager if:
(1) the licensee has a restricted license;
(2) the licensee has been the subject of a bar order;
or
(3) the licensee is a salesperson with less than two years full time real estate experience in the last five years before being appointed.
So this needs to be kept in mind as a compliance issues. Many brokers we deal with have several offices and want to appoint branch managers to their other offices. Here is something to think about if you are the real estate licensee who wants to become the branch manager:
(1) The branch manager may supervise and oversee the day to day activities of the branch;
(2) the branch manager can be subject to DRE sanctions and license discipline;
This means, the licensee who is taking the reins can have significant responsbility, but can also be on the hook for compliance activity in the branch office. This means the real estate broker seeking to appoint a branch licensee should choose wisely, and find someone mature enough to understand the DRE rules and to comply with them. The appointing broker will still have the responsibility to ultimately oversee all the acitivities of the branch and so the duty to supervise never really goes away with the appointment of the branch manager.
The appointment and delegation requires a written agreement wherein the appointed branch manager agrees to the appointment and to accept the delegated responsibility. The DRE has to be notified thereafter on a DRE approved form.
For brokers seeking to make this designation and who may be seeking the assistance of a California real estate lawyer in structuring the relationship and documenting policies, rules, procedures, social media policies, contracts, and other compliance materials our firm is available for consultation by calling (877) 276-5084.
Here is a Department of Real Estate Advisory on Branch offices and appointing branch managers.
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