(a)A complaint which names a licensed real estate
sales agent as the subject of the complaint but does not specifically
name the sales agent's sponsoring broker, is a complaint against the
broker sponsoring the sales agent at the time of any alleged violation
for the limited purposes of determining the broker's involvement in
any alleged violation and whether the broker fulfilled his or her
professional responsibilities provided the complaint concerns the
conduct of the sales agent as an agent for the broker.
(b)The designated broker is responsible for all real
estate brokerage activities performed by, on behalf of, or through
a business entity. A complaint which names a business entity licensed
as a broker as the subject of the complaint but which does not specifically
name the designated broker is a complaint against the designated broker
at the time of any alleged violation for the limited purposes of determining
the designated broker's involvement in any alleged violation and whether
the designated broker fulfilled his or her professional responsibilities.
A complaint which names a sales agent sponsored by a licensed business
entity but which does not specifically name the designated broker
of the business entity is a complaint against the designated broker
at the time of any alleged violation by the sales agent for the limited
purposes of determining the designated broker's involvement in any
alleged violation and whether the designated broker fulfilled his
or her professional responsibilities provided the complaint concerns
the conduct of the sales agent as an agent of the business entity.
(c)Using the criteria specified by Section 1101.204
of the Act, the Commission prioritizes and investigates complaints
received by the Commission as follows:
(A)Fraud or misrepresentation that involves loss of
(B)Personal safety issues.
(A)Fraud or misrepresentation that involves loss of
money or property <$10,000.
(C)Allegations involving education providers.
(D)Violations of Chapter 1102, Texas Occupations Code:
(i)1102.301 negligence or incompetence by an inspector.
(ii)1102.302 employment contingent on inspection report.
(iii)1102.303 acting in conflicting capacities, i.e.
inspector, broker, principal.
(iv)1102.305 agreeing to perform repairs in connection
(E)Violations of Standards of Practice, §§535.227-535.231
of this chapter.
(B)Chapter 1102 complaints other than those listed
in Level 2 above.
(d)If information obtained during the course of an
investigation of a complaint reveals reasonable cause to believe the
respondents to the complaint may have committed other violations of
the Act or rules, no additional authorization shall be required to
investigate and take action based upon the information.
(e)If the Commission suspends or revokes a license
or probates an order of suspension or revocation against a license
holder, the Commission may monitor compliance with its order and initiate
action based on the authority of the original complaint or original
authorization by the members of the Commission.
(f)A person whose license has been suspended may not
during the period of any suspension perform, attempt to perform, or
advertise to perform any act for which a license is required by the
Act or Rules.
(g)A person whose license is subject to an order suspending
the license must provide notice in writing not later than the third
day before the date of the suspension as follows:
(1)if the person is a sales agent, notify his or her
sponsoring broker in writing that his or her license will be suspended;
(2)if the person is a broker, notify any sales agent
he or she sponsors, or any business entity for which the person is
designated broker that:
(A)his or her broker license will be suspended; and
(B)once the suspension is effective, any sales agent
he or she sponsors, or who is sponsored by the business entity, will
no longer be authorized to engage in real estate brokerage unless:
(i)the sales agent is sponsored by another broker
and files a change of sponsorship with the Commission; or
(ii)the business entity designates a new broker and
files a change of designated broker with the Commission;
(3)If the person is an apprentice inspector or real
estate inspector, notify his or her sponsoring professional inspector
that his or her license will be suspended;
(4)if the person is a professional inspector notify
any apprentice or real estate inspectors he or she sponsors that:
(A)his or her professional inspector license will
be suspended; and
(B)once the suspension is effective any apprentice
or real estate inspectors he or she sponsors will no longer be authorized
to inspect any real property unless the apprentice or real estate
inspectors associate with another professional inspector and file
a change of sponsorship with the Commission.
(5)if the person has a contractual obligation to perform
services for which a license is required by law or Commission rule,
notify all other parties to the contract that the services cannot
be performed during the suspension;
(6)if the person is a sales agent and is directly
involved in any real estate transaction in which the sales agent acts
as an agent, notify all other parties, including principals and other
brokers, that the person cannot continue performing real estate brokerage
services during the suspension; and
(7)if the person holds money in trust in any transaction
in which the person is acting as a broker, remit such money in accordance
with the instructions of the principals.
(h)If, in conjunction with an application or disciplinary
matter, an applicant or license holder agrees to automatic suspension
or revocation of his or her license for failing to comply with an
administrative term or requirement of an agreed order such as payment
of a penalty or completion of coursework, the license may be automatically
suspended or revoked with no further action by the Commission.
(i)A broker may not assign to another broker a listing
agreement, buyer's representation agreement or other personal service
agreement to which the broker is a party and which obligates the broker
to perform acts for which a license is required without first obtaining
the written consent of the other parties to the contract.
The agency certifies that legal counsel has reviewed
the adoption and found it to be a valid exercise of the agency's legal
Filed with the Office
of the Secretary of State on May 8, 2019
Deputy General Counsel
Texas Real Estate Commission
Effective date: May 28,
Proposal publication date: March 1, 2019
For further information, please call: (512) 936-3093