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21. Property Management and Rentals

39 DOS 91 Matter of Milliman - license required for rental of properties

Opinion Letter 91-46 (Joseph C. Dettelis) - license required for management company which collects rents

Opinion Letter 92-50 (Frank G. Pratt) - not-for-profit corporation which manages apartment complex must be licensed; not sufficient that a board member is a broker

Opinion Letter 92-52 (Raymond Shanley) - not-for-profit corporation assisting formerly homeless tenants and/or landlords in negotiating rentals and in collecting rents, which is to be paid its "administrative costs," requires a license

11 DOS 93 DOS v. Luskin experience in managing property as part owner or in negotiating acquisition as volunteer of non-profit organization is qualifying experience, but no license required

128 DOS 93 Matter of DOS v. Vuksanaj - motion to conform pleadings to proof granted where (i) additional evidence wouldn't have been presented if the charge had been stated in the complaint and (ii) issue was actually litigated and was within the "broad framework of the pleadings"; broker's authorization to execute lease on behalf of landlord must be in writing to be valid (G.O.L. §5-703); no commission earned on void lease (due to lack of written authority for broker to sign for landlord); broker is undisclosed "double agent" - thus "fails to make clear" for which party he is acting (175.7); broker is not "managing agent" under NYC Rent Stabilization Code unless (i) broker has ownership or financial interest in property or (ii) performs managerial duties; separate escrow account (§175.1) not required when broker is not holding escrowed funds; holding funds overnight does not trigger requirement for escrow account (returned next day upon demand); unlicensed name used in commission agreement but lack of intent to mislead considered in mitigation; restitution of unearned commission

142 DOS 93 Matter of Tannenbaum - corporation which manages real property, collects rents and cooperative apartment building maintenance charges requires a license; unlicensed salesperson and unlicensed corporation precludes legitimate claim for brokerage fee; settlement of civil suit between tenant and unlicensed corporation is not a defense to charge of unlicensed activity; corporation's failure to pay judgment where individual respondent is not a party is not considered in disciplinary case against said individual; deposit monies should be returned, as no viable lease was entered into and no lawful brokerage commission could be claimed; restitution of entire deposit ordered (civil action settlement provided for return of $600 of $900), as no licensed real estate services were rendered; however, retention of deposit is not conversion or illegal retention of deposit monies, but is unlawful claim for commission by non-licensee; broker's failure to file termination of association notices violates RPL §441-a(5); respondent's cooperation during investigation considered, as is testimony that action resulted from lack of knowledge and negligent, not deliberate attempt to violate licensing law

35 DOS 95 Matter of Gooding - jurisdiction; amendment of complaint as of right (CPLR 3025[a]); second amendment of complaint by permission; plea of guilty with explanation; commingling of deposits in violation of 19 NYCRR §175.1; conversion of escrow funds; failure to render account is violation of 19 NYCRR §175.2; retention of unearned management fee; restitution of $28,233.85 plus interest at judgment rate

1434 DOS 08 Matter of Zackson – broker; property management; failure to provide RPL 443 agency disclosure; issue check with insufficient funds; bad checks not reimbursed; failure to account (175.2); failure to cooperate; revocation

593 DOS 09 Matter of Orlando – failure to manage property; failure to account funds; failure to cooperate with DOS investigation; $300 fine and refund $1,200 with interest

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The third quarter 2018 edition of NYSAR’s Legal Lines is now available online at NYSAR.com. This edition covers what a broker's agent actually is, the legal issues related to social media use, conditional approval for financing is not a mortgage commitment and more. Learn more

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