Bill Text: NY S05693 | 2013-2014 | General Assembly | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relates to clarifying the permissibility of commissions, fees, or other compensation paid to real estate brokers.

Spectrum: Slight Partisan Bill (Republican 2-1)

Status: (Passed) 2014-12-17 - SIGNED CHAP.514 [S05693 Detail]

Download: New_York-2013-S05693-Amended.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                        5693--A
                              2013-2014 Regular Sessions
                                   I N  S E N A T E
                                     June 5, 2013
                                      ___________
       Introduced  by  Sens. ZELDIN, VALESKY -- read twice and ordered printed,
         and when printed to be committed to  the  Committee  on  Judiciary  --
         recommitted  to  the  Committee on Judiciary in accordance with Senate
         Rule  6,  sec.  8  --  committee  discharged,  bill  amended,  ordered
         reprinted as amended and recommitted to said committee
       AN  ACT  to  amend  the real property law, in relation to clarifying the
         permissibility of commissions, fees or other compensation paid to real
         estate brokers
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. Section 442 of the real property law, as amended by chapter
    2  45  of the laws of 1982, the opening paragraph as amended by chapter 316
    3  of the laws of 2004, the second undesignated  paragraph  as  amended  by
    4  chapter 734 of the laws of 1986, is amended to read as follows:
    5    S  442.  Splitting commissions. 1. No real estate broker shall pay any
    6  part of a fee, commission or other compensation received by  the  broker
    7  to  any  person  for  any  service, help or aid rendered in any place in
    8  which this article is applicable,  by  such  person  to  the  broker  in
    9  buying, selling, exchanging, leasing, renting or negotiating a loan upon
   10  any  real  estate  including  the resale of a condominium OR COOPERATIVE
   11  APARTMENT unless such a person be a duly licensed real  estate  salesman
   12  regularly  associated  with  such  broker or a duly licensed real estate
   13  broker or a person regularly engaged in the real estate brokerage  busi-
   14  ness  in  a  state outside of New York; provided, however, that notwith-
   15  standing any other provision of this section, it  shall  be  permissible
   16  for  a real estate broker to pay any part of a fee, commission, or other
   17  compensation received to an  unlicensed  corporation  or  an  unlicensed
   18  limited  liability  company  if  each  of  its  shareholders or members,
   19  respectively, is associated as an individual with the broker as  a  duly
   20  licensed associate broker or salesman.
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD11341-04-4
       S. 5693--A                          2
    1    2.  Furthermore,  notwithstanding any other provision of law, it shall
    2  be  permissible  for  a  broker  properly  registered  pursuant  to  the
    3  provisions  of  article  twenty-three-A  of the general business law who
    4  earns a commission on the original sale of a cooperative  or  homeowners
    5  association  interest in real estate, including condominium units to pay
    6  any part of a fee, commission or other compensation received for  bring-
    7  ing about such sale to a person whose [prinicipal] PRINCIPAL business is
    8  not  the  sale  or  offering  of  cooperatives or homeowners association
    9  interests in real property, including condominium units  in  this  state
   10  but  who  is either: (i) a real estate salesman duly licensed under this
   11  article who is regularly associated with such broker; (ii) a broker duly
   12  licensed under this article; or a person regularly engaged in  the  real
   13  estate brokerage business in a state outside of New York.
   14    [Except  when  permitted  pursuant to the foregoing provisions of this
   15  section no real estate broker shall pay or agree to pay any  part  of  a
   16  fee,  commission,  or other compensation received by the broker, or due,
   17  or to become due to the broker to any person, firm or corporation who or
   18  which is or is to be a party to  the  transaction  in  which  such  fee,
   19  commission  or  other compensation shall be or become due to the broker]
   20  PROVIDED, HOWEVER, THAT NOTHING IN THIS SECTION SHALL  PROHIBIT  A  REAL
   21  ESTATE  BROKER  FROM  OFFERING  ANY  PART OF A FEE, COMMISSION, OR OTHER
   22  COMPENSATION RECEIVED BY THE BROKER TO THE SELLER,  BUYER,  LANDLORD  OR
   23  TENANT WHO IS BUYING, SELLING, EXCHANGING, LEASING, RENTING OR NEGOTIAT-
   24  ING A LOAN UPON ANY REAL ESTATE INCLUDING THE RESALE OF A CONDOMINIUM OR
   25  COOPERATIVE  APARTMENT. SUCH FEE, COMMISSION, OR OTHER COMPENSATION MUST
   26  NOT BE MADE TO THE SELLER, BUYER, LANDLORD OR TENANT FOR PERFORMING  ANY
   27  ACTIVITY REQUIRING A LICENSE UNDER THIS ARTICLE.
   28    S 2. This act shall take effect immediately.