NORTH CAROLINAREAL ESTA.TE COMMISSIONReal Estate BulletinWinter 1997Volume27CommissionStaff UpdateThe RealEstate Commission recentlyfilled a positionin the RecordsSection of theAdministrationDivision.Faye E. Ray has been employedas a Records Specialist. She is anative North Carolinian.Prior to joining the Commissionstaff, Faye was employed as a Patient SeiVice Representative at anorthopaedic clinic in Raleigh. SheseiVed as a Policy Service Analystfor an insurance company for over15 years.In her new position with theCommission, Faye will assist withupdating and maintaining licenseefiles.Continuing Education OfficerEvelyn G. Johnston has assumednew duties in the Commission'sAudits & Investigations Division,where she will seiVe as ComplianceOfficer. Her duties will includeconducting reviews and inspectionsof individual licensees' and licensedentities' records, assisting in monitoring Commission-approved realestate courses, and conductingCommission-developed courses andinstructional programs.Evelyn has a B.A. degree in English from Sam Houston University.(continued on page 2)Number4Commission amendsagency ruleFollowing a September 18 rulemaking hearing, the Real EstateCommission at its November 6meeting approved amendments toits rule on agency agreements anddisclosure (Rule A .0104).The amendments enable real estate firms in dual agency transactions "to designate" one or more ofits brokers or salesmen to representthe buyer, and another or otherbrokers or salesmen to representthe seller.The amendments also providethat an individual broker or salesman, when representing both thebuyer and seller in the same transaction, may (with the written consent of the buyer and seller) withhold any information about a partywhich that party has identified asconfidential, unless disclosure isrequired by statute or rule.Following is the complete text ofthe rule amendments (subsectionsi-n) which will become effectiveJuly 1, 1997 if approved by theGeneral Assembly:"(i) A firm which represents boththe buyer and the seller in the samereal estate sales transaction is adual agent and through the brokersand salesmen associated with thefirm shall disclose its dual agency tothe buyer and seller.(j) When a firm represents boththe buyer and seller in the samereal estate sales transaction, thefirm may, with the prior writtenapproval of its buyer and sellerclients, designate one or more individual brokers or salesmen associated with the firm to represent onlythe interests of the seller and one(continued on page 4)A reminder/Thb rule requiring ·the lieensure of all real estate business entitiesbecame effective January 1, 1997. Any corporation, ptl111J.ership, limlUdllahility comptmy or other business entity (otber than :sole proprietorship)· the brokerage 6ustlu!ss must obtain a l'e81 estate brokerU ense.For information and/or application forms and materials, please contactthe North Carolina Real Estate Commission at (91'} 733 9580.0

REAL ESTATEBULLETINPublished quarterly as a service to real estatelicensees to promote a better understanding ofthe Real Estate License law and CommissionRules, and proficiency in real estate practice.The arti:1ei published herein shaD not be reprintedor reP.roduced in any other publication withoutspecific reference being made to their originalpublication in the North Carolina Real EstateCommission Real Estate Bulletin.NORTH CAROIJNA REAL ESTATECOMMISSION1313 Navaho DnveP.O. Box 17J 00Raleigh, North Carolina 27619- 7100Phone 91 91733-9580James B. Hunt, Jr., GovernorCOMMISSIE N MEMBERSJohn D. Bridgeman . GastoniaChairmanWanda J. Proffitt . . . BurnsvilleVice-CbairmanRaymond A. Bass, Jr. . . FayettevilleSang J. Hamilton, Sr . . . . . WintonMona S. Hill . . . . . . . . . . . . . . . . . . PinehurstBillie J. Mercer . . . . . . . . . . . . . . . . . . WilsonJ. Kemp Sherron, III . . . RaleighCommissionStaff Update(continued from page I)Pam was licensed as a real estatesalesman in 1993 and now has herbroker license.Education Clerk Susan M. Tysorhas transferred to the Administration Division as a RecordsSpecialist to assist in convertingmicrofilm records to optical imaging.Susan was employed with the Cornmission from 1984 - 1986, prior tomoving out-of-state. After returningto Raleigh, she held a secretarialposition at an environmental agencyand returned to the Commission staffin 1995.She is a former high schoolEnglish teacher and a licensed realestate broker.Licensing and Education OfficerPamela R. Milligan will fill theposition of Continuing EducationOfficer, to coordinate the Commission's CE Program.Pam received a BA in Englishand Speech Communications andSecondary Education from UNCChapel Hill and an MA inLiterature from ECU. She taughthigh school English for over 14years.(continued on page 3)Phillip T. FisherExecutive DirectorREGISTRATION FORMADMINISfRATIONBASIC TRUST ACCOUNT PROCEDURES COURSEMary Frances Whitley . . . DirectorPaula L. Lassiter . . . . . . . . . . Financial OfficerVickie R. Crouse . . . Data Proc. AdministratorCarrie D. Worthington . . . Publications OfficerTRUST ACCOUNT PROCEDURES FORRESORT PROPERTY MANAGERS COURSEforAUDITS & INVESTIGATIONSChristopher B. Smith . . . . . . . . . . . DirectorEmmet R. Wood . Senior AuditorGary R. Caddell . . . Sr. Auditor/]nvestigatorEvelyn G. Johnston . Compliance OfficerJennifer K. Boger . . Auditor/InvestigatorMichael B. Gray . . . Auditor/InvestigatorWarren H. Harper . . Auditor/InvestigatorRenee L. Rhodes . Auditor/InvestigatorJarrod L. Williams . . . . Auditor/InvestigatorEDUCATION & LICENSINGLarry A. Outlaw . . . . . . . . . . . . . . . DirectorAnita R. Burl . . . . . . . . . . Ed./Exam. OfficerPamela R. Milligan . . . . . Cont. Ed. OfficerLEGAL SERVICESThomas R . Miller . Lgl. Counsel, DirectorSpec. Dep. Attorney GeneralMiriam J. Baer . . . . . . Assistant DirectorBlackwell M. Brogden, Jr. . . Chief Dep. Lgl.CounselMarilyn E. Tomei . . Dep. Lgl. CounselStephen L. Fussell . . . . . Cons. Prot. OfficerRobin F. Oliver . . . . . . . Cons. Prot. OfficerBarbara W. Mcintyre . . Information OfficerEditor in ChiefPhillip T. FisherEditorCarrie D. Worthington11ndCourses will comply with Commission Rule Section 58 A.1705 Attendance and ParticipationRequirements for Continuing Education. Four (4) hours continuing education elective creditwill be awarded for completion of each course. Courses are intended for brokers and trustaccount bookkeepers. Salesmen will be admitted on a space available basis.BASIC TRUST ACCOUNT PROCEDURES COURSE- Raleigh- 1:00 P.M. to 5:00P. M.OMarch 110 April 8O Juty 80 August 12DMay 130 June 3BASIC TRUST ACCOUNT PROCEDURES COURSE- Caravan· 9:00A. M. to 1:00 P.M.0 Nags Head (March 4)0 Morehead City (March 6)*0 Wilmington (March 18)0 Southern Pines (March 20)0 Asheville (March 24)0 Gastonia (March 26)0 Greensboro (March 27)TRUST ACCOUNT PROCEDURESFOR RESORT PROPERTY MANAGERS COURSE- Caravan· 9:00A.M. to 1:30 P.M.0 Nags Head (March 5)0 Wilmington (March 19)0 Morehead City (March 7)OSouthern Pines (March 21)0 Asheville (March 25)Complete this form (make copies for additions/ persons/. Indicate the session location for thecourse which you would like to attend. Mail registration form with a check for 35 tuition feeto be received in the Commission Office no later than 10 days prior to date of course. Wrth oneexception, (please see * at bottom of this form) , sessions will be limited to 40 participants.Walk·lna will be accepted on a space available baala only.Name Phone(OIIyfime/Addmsstsrr.,,, P.O. Box, etc./(City/0 Broker (Ucense No. --'0 Salesman (license No. -'0 Bookkeeper* This session, only, limited to 25 participants.2Mail to: ---(SIIIIB/(Zip}NC REAL ESTATE COMMISSIONAttention: Education ClerkP. 0 . Box 17100Raleigh, NC 27619-7100Enclose 35 tuition fee(All other sessions limited to 40.)

CommissionStaff Update(continued from page 2)Auditor/Investigators Renee L.Rhodes and Jarrod L. Williamshave been designated "CertifiedInvestigators" by the Council on Licensure, Enforcement and Regulation (CLEAR).The following Commission staffmembers have made appearancesbefore various real estate industryand related groups since the lastissue of the Bulletin. Special Deputy Attorney General Thomas R.Miller participated in a "questionand-answer" session at the "1996REALTOR Rally" that was heldby the Charlotte Regional REALTOR Association. Tom answeredquestions on agency disclosure, realestate contracts and related topics. At a meeting of the WinstonSalem Board of REALTORS ,Miriam J, Baer, the Commission'sAssistant Director of Legal SeiVicesdiscussed agency and other issuesHappy anniversary .to us!I.I,affecting commercial real estatebrokers. Miriam and Deputy LegalCounsel Marilyn E. Tomei made ajoint presentation on risk management issues at the N.C. Associationof REALTORS Annual Convention in Myrtle Beach, S.C.(Individuals and groups requestinga speaker from the Real Estate Commission are reminded that a "Requestfor Program Presenter" form is available from the Commission Office.) -----------1(On July 1, 1997, the North Carolina Real Estate Commission willcelebrate for:Qr . years of service tothe state's real estate consumersa d licensees.· And to ommemo rate the oc.:asio.n, the CQmmissionplans a special anniv rsary editionof the Real Estate Bulletin.Look for special feat es and. articles of interest to new licenseeS.and ''veterans" alike, . as the coin .:ntissi remembers its first fortyyears - in the anniversfP'Y edition ofthe Blllletin, Volume 28, Num./J-er 2,Summer ·1991. ·no.itltAL·ESTATE COMMISSION PUBLICATIONSORDER FORM1II-No. CopiesIf.1·I· t1'.RequestedIta. /!r(}perty DJsc/Q ure Sta,ement QtU/ Gukklbtesform(Free, PleaSe limit rt!quest to one copy.)Qjlati!Jltl ani Alt WfS mt: TenllJJt Sea rlty Depo 1Js(l'ret ·Brochure)1Also available in bulk to property managers toI}.distributeto tenants atld landlords.II.I1I1II·I IIQ.ueitltPI AafWI'S om(Jrret' Bi lthu )lr dAiflwer.t op:rl lI!·- Ct ml08 tmtlTownhOIISufnloAgt.nts llepmmtBrodnli'e)0t.t!·f!lll op;.(iree BrOebnr.e)II"·lPurc/ulsblg CtHUtal Reid Es!GteIn Ntffth CQIOI/n4{t)I NUR"t -: : NOT.:i-.0::· X).rstatt ZipCityl».stni.etiobSII 1 Y · -.y. req1Jat 1JJgle pte of p1ilb1ications by returning this Orderj'()fin : · lllq: the Co.m n o .(.919) 733-9580, menu option 3.1.1 2. T lorll miftJPI copteJ of tlluepublications, please complete this Order1F. 'iid :r tD111 ·t tb'e N.C. Real Estate Commission; .P.O. Box l11GO,,: · 276l9.-71t()'. A.t:tentiOn Publka1ions.II· 'ii. PIAQ: alto"JV:two: wee for d'Jive:ry.r Oht.EXAM RESULTSPassed FailedSeptember 19968361BrokersSalesmen292255October 199644Brokers55Salesmen240176November 1996Brokers5235Salesmen363207,.,f.IWe :.W.r.Stahcf thilt·ol-ders ot ethan .SO eoptes special :RUWRttal ertf Di'Sd.Osllrt Statement andI.I"1:I·.s.1t. - rr eiiauoa.Guidelines may be Pl :u:.aeea Sp)tC8 : : -: ed oa:the.fl lons and Auwen broe.h.ure. if youwWi :to·adf :,OUr: ompany name.1:,. . . .-.w ·-----3. .-----. .'-·------------. ----------------. .J

Commission amendsagency rule(continued from page 1)or more other individual brokersand salesmen associated with thefirm to represent only the interestsof the buyer in the transaction. Anindividual broker or salesman shallnot be so designated and shall notundertake to represent only theinterests of one party if the brokeror salesman has actually receivedconfidential information concerningthe other party in connection withthe transaction. A broker-in-chargeshall not act as a designated agentfor a party in a real estate salestransaction when a salesman underhis supervision will act as a designated agent for another party witha competing interest.(k) When a firm acting as a dualagent designates an individual broker or salesman to represent theseller, the broker or salesman sodesignated shall represent only theinterest of the seller and shall not,without the seller's permission, disclose to the buyer or a broker orsalesman designated to representthe buyer:(1) that the seller may agree toa price, terms, or any conditions of sale other thanthose established by theseller;(2) the seller's motivation forengaging in the transactionunless disclosure is otherwise required by statute orrule; and(3) any information about theseller which the seller hasidentified as confidentialunless disclosure of the information is otherwise required by statute or rule.(1) When a firm acting as a dualagent designates an individual broker or salesman to represent thebuyer, the broker or the salesmanso designated shall represent onlythe interest of the buyer and shallnot, without the buyer's permission,disclose to the seller or a broker orsalesman designated to representthe seller:(1) that the buyer may agree toa price, terms, or any conditions of sale other thanthose offered by the buyer;(2) the buyer's motivation forengaging in the transactionunless disclosure is otherwise required by statute orrule; and(3) any information about thebuyer which the buyer hasidentified as confidentialunless disclosure of the information is otherwise required by statute or rule.(m) A broker or salesman designated to represent a buyer or sellerin accordance with Section (b) ofthis Rule shall disclose the identityof all of the brokers and salesmenso designated to both the buyer andthe seller. The disclosure shall takeplace no later than the presentationof the first offer to purchase or sell.(n) When an individual broker orsalesman represents both the buyerand seller in the same real estatesales transaction pursuant to a written agreement authorizing dualagency, the parties may provide inthe written agreement that the broker or salesman shall not disclosethe following information about oneparty to the other without permis4sion from the party about whom theinformation pertains:(1) that a party may agree to aprice, terms or any conditions of sale other thanthose offered;(2) the motivation of a party forengaging in the transaction,unless disclosure is otherwise required by statute orrule; and(3) any information about aparty which that party hasidentified as confidential,unless disclosure is otherwise required by statute orrule."o"Trust AccountGuidelines"revisedStarting on page 7 of thisBulletin is the first portionof the Commission's "TrustAccount Guidelines," asthey appear in the latestedition of the license application booklet, Real EstateLicensing in Notth Carolina(Revised 11/1/96).The Commission is reprinting the Guidelines foryour review and information.The final installment willappear in the next Bulletin Spring 1997, Volume 28,Number 1.

Broker Price OpinionsBy Roberta Ouellette, Legal CounselNorth Carolina Appraisal BoardA "broker's price opinion" (i.e. anopinion as to a property's probablesale price) is an "appraisal" underthe North Carolina Appraiser Act.Real estate licensees may not provide such an appraisal service for afee unless they ar:e state-licensed orstate-certified real estate appraisersand the opinion of value conformswith the Uniform Standards of Professional Appraisal Practice.The only type of appraisal that can beperformed by real estate agents who arenot appraisers is a "Comparative MarketAnalysis" (CMA), which is defined as" . the analysis of sales of similarrecently sold properties in order toderive an indication of the probablesales price of a particular property ."Although a CMA is also a type ofappraisal, the Appraiser Act as interpreted by the Appraisal Board allowsreal estate licensees to perform themfor seller-clients or prospective sellerclients in the course of listing or attempting to list their property and forbuyer-clients who are interested inbuying a property so long as licenseesdo not represent themselves as statelicensed or -certified appraisers anddo not accept a fee for providing it(even if the fee is only intended tocover the licensee's expenses).It is important to note that the Comparative Market Analysis exemptiononly applies where real estate licensees are performing a brokerage service for their principals, such as listing a property or showing listed properties, otherwise, a CMA (or a "broker's price opinion") performed by areal estate licensee for a fee violatesthe law unless the licensee is also alicensed or certified appraiser.0Shown with the award, left to right:Commission Member MonaHill,Commission Vice-Chairman WandaProffitt, Publications Officer CarrieWorthington and Commission Chairman John Bridgeman.You are reminded that the RealEstate Commission's meetings areopen to the public. Real estate licensees and consumers are alwayswelcome.Although advance notice is notrequired in order for you to attend,you are encouraged, when possible,to please notify the Commission ofyour plans to attend a scheduledmeeting at least ten business daysprior to the meeting, in order toensure adequate parking and seatingarrangements.Please mail yournotice to the North Carolina RealEstate Commission, P. 0. Box17100, Raleigh, NC 27619-7100, orcall the Commission office (919)733-9580.For your convenience, the following calendar lists the meeting datesfor the next six months.0C()o) (Q)TfilQilll§ml&ufMeeting DatesWe won!At its annual conference this fall inOttawa, Ontario, Canada, the Association of Real Estate License LawOfficials (ARELLO) presented its"Newsletter Excellence Award" to theCommission for its Real Estate Bulletin and Continuing EducationSchedule publications.For your information.In memoriamWith deep regret, the Real EstateCommission announces the recentdeath of James E. "Jim" Poole,Jr., of Raleigh. Mr. Poole servedas Director of the Commission'sAppraiser Licensing and Certification Division prior to the Appraisal Board's separation fromthe Commission.He was the Appraisal Board'sfirst Executive Director, but hadstepped down from that positiondue to health reasons.The Commission extends deepestsympathy to Mr. Poole's family. 5March 12April9May 14June 11July to August 13Meetings begin at 9 a.m. andusually are held in the conference room at the North Carolina Real Estate Commissionoffice, 1313 Navaho Drive, Raleigh, NC 27609. [Please un-derstand that circumstancessometimes necessitate changes inmeeting dates and times.]*Town Hall, Blowing Rock, NC

IICommission offersdemand''"fax-on- .; By Mary Frances Whitley, Director of AdministrationThe Real Estate Commission ispleased to announce the installationof a "fax-on-demand" system foruse by licensees as well as membersof the general public. Using atouch-tone teleP.hone, callers canrequest and immediately receiveforms and other information- simply by entering the document number(s) of the desired material.To access the system, dial (919)850-2757, then follow the automated instructions using theDOCUMENT NUMBER providedon the system index, and enteryour fax number (number whereyou wish to receive the document).The following documents areavailable from the various Commission Divisions/Sections through thefax-on-demand system:Administration/Records Request to Activate Broker orSalesman License, Notificationof Salesman Supervision, Notification of Change of Broker'sBusiness Address Broker-in-Charge Declaration Request for Reissuance of RealEstate License Certificateand/or Renewal Pocket CardEducation/Licensing Continuing Education CourseSchedule Publications Order Form License Examination Scheduleand License Examination Review Schedule Basic Trust Account ProceduresCourse Schedule and Registration Form Order Form for License Examination Candidate Roster Order Form for Register ofNew Licensees Legal ServicesComplaint FormCriminal Conviction ReportingFormResidential Property Disclosure Statement Disclosure to Buyer FromSeller's Agent or SubagentOtherRequest for Program Presenter199

Education Clerk Susan M. Tysor has transferred to the Adminis tration Division as a Records Specialist to assist in converting microfilm records to optical imaging. Susan was employed with the Corn mission from 1984 - 1986, prior to moving out-of-state. After returning to Raleigh, she held a secretarial