(1) As used in this section, ‘trust funds’ means money belonging to others that is received or handled by a licensed real estate property manager or principal real estate broker in the course of conducting professional real estate activity and in the real estate licensee’s fiduciary capacity.

Terms Used In Oregon Statutes 696.241

  • Attachment: A procedure by which a person's property is seized to pay judgments levied by the court.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Escrow: Money given to a third party to be held for payment until certain conditions are met.
  • Fiduciary: A trustee, executor, or administrator.
  • Person: includes individuals, corporations, associations, firms, partnerships, limited liability companies and joint stock companies. See Oregon Statutes 174.100
  • Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC

(2) A licensed real estate property manager, or a principal real estate broker who engages in the management of rental real estate, shall open and maintain in this state one or more separate federally insured bank accounts that are designated clients’ trust accounts under ORS § 696.245. A principal real estate broker who engages in the management of rental real estate or a licensed real estate property manager shall deposit in a clients’ trust account all trust funds received or handled by the principal real estate broker, licensed real estate property manager or real estate licensees subject to the supervision of the principal real estate broker.

(3)(a) A principal real estate broker who receives or handles trust funds and does not deposit the trust funds in a licensed neutral escrow depository as described in paragraph (b) of this subsection shall open and maintain in this state one or more separate federally insured bank accounts that are designated clients’ trust accounts under ORS § 696.245. Pursuant to written agreement of all parties to a real estate transaction having an interest in the trust funds, the principal real estate broker shall immediately place the trust funds in a clients’ trust account.

(b) A principal real estate broker may deposit trust funds in a licensed neutral escrow depository in this state.

(4) A principal real estate broker or licensed real estate property manager who opens a clients’ trust account under subsection (2) or (3) of this section, or to whom ownership of a clients’ trust account is transferred, is liable for all deposits and disbursements made using the clients’ trust account until the principal real estate broker or licensed real estate property manager closes the account or transfers ownership of the account.

(5) A principal real estate broker or licensed real estate property manager may not commingle any other funds with the trust funds held in a clients’ trust account, except for:

(a) Earned interest on a clients’ trust account as provided in subsections (7) and (8) of this section; and

(b) Earned compensation as provided in subsection (9) of this section.

(6) If a licensed real estate property manager or principal real estate broker maintains a separate clients’ trust account in a branch office, a separate bookkeeping system must be maintained in the branch office and a copy of the records required under ORS § 696.280 must be maintained in the main office of the licensed real estate property manager or principal real estate broker.

(7) Trust funds received by a licensed real estate property manager or principal real estate broker may be deposited by the licensed real estate property manager or principal real estate broker in a federally insured interest-bearing bank account that is designated a clients’ trust account under ORS § 696.245, but only with the prior written approval of all parties who have an interest in the trust funds. The earnings of the interest-bearing account inure to the benefit of the licensed real estate property manager or principal real estate broker only if expressly approved in writing by all parties who have an interest in the trust funds before deposit of the trust funds.

(8) With prior written notice to all parties who have an interest in the trust funds, a principal real estate broker may place trust funds received by the principal real estate broker in a real estate sales, purchase or exchange transaction in a federally insured interest-bearing bank account that is designated a clients’ trust account under ORS § 696.245, the earnings of which inure to the benefit of a public benefit corporation, as defined in ORS § 65.001, for distribution to organizations and individuals for first-time homebuying assistance and for development of affordable housing. The principal real estate broker shall select a qualified public benefit corporation to receive the interest earnings.

(9) In connection with a real estate sales, purchase or exchange transaction, a principal real estate broker is not entitled to any part of any interest earnings on trust funds deposited under subsection (7) of this section or to any part of the earnest money or other money paid to the principal real estate broker as part or all of the principal real estate broker’s compensation until the transaction has been completed or terminated. The principal real estate broker and the seller shall negotiate and agree in writing to the disposition of forfeited earnest money at the time of execution by the seller of any listing agreement or earnest money agreement. An agreement about the disposition of forfeited earnest money must be initialed by the seller or immediately precede the seller’s signature.

(10) Trust funds in a clients’ trust account are not subject to execution or attachment on any claim against a licensed real estate property manager or principal real estate broker.

(11) The Real Estate Agency by rule shall establish an optional procedure by which a principal real estate broker may elect to disburse disputed funds held in relation to the sale, exchange or purchase of real estate from a clients’ trust account to the person who delivered the funds to the principal real estate broker. The procedure must allow disbursal not more than 20 days after a request is made for the disbursal. A disbursal pursuant to the procedure does not affect the claim of any other person to the funds.

(12) The agency may provide by rule for other records to be maintained and for the manner in which trust funds are deposited, held and disbursed. The rules adopted under this subsection may include requirements for interest or compensation held in a clients’ trust account pursuant to subsection (5) of this section to be disbursed from the clients’ trust account to a licensed real estate property manager or principal real estate broker.

(13) A real estate licensee who, for the purpose of transmitting a check, receives the check from a buyer or tenant that is payable to a property owner or seller is exempt from the deposit requirements of subsections (2) and (3) of this section. The agency may determine by rule the records that must be maintained for checks received as described in this subsection and the manner in which the checks must be transmitted. [1975 c.746 § 18 (enacted in lieu of 696.240); 1977 c.649 § 39; 1981 c.617 § 11a; 1985 c.589 § 4; 1991 c.5 § 37; 2001 c.300 § 21; 2003 c.224 § 1; 2005 c.116 § 18; 2005 c.393 § 2a; 2007 c.224 § 1; 2007 c.319 § 9; 2007 c.337 § 4; 2009 c.224 § 5; 2009 c.324 § 5; 2011 c.158 § 4; 2013 c.145 § 13; 2017 c.234 § 15]

 

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