Clarification of a Broker’s Right to Delegate Under the New DRE Regulations

The California Legislature passed SB510 last year, which adds Sections 10164 and 10165 to the California Business and Professions Code section. Those Code sections took effect on July 1, 2012.

Those sections permit a real estate broker or officer to appoint a real estate licensee as a branch office or division manager who will be responsible for supervision of the brokerage’s operations and will be subject to discipline by the California Department of Real Estate for failure to properly supervise. A real estate licensee cannot qualify as a branch manager if they hold a restricted license, has been subject to a bar order or has less than two years of full-time real estate experience within the last five years.

If a broker chooses to make such an appointment under the new law, it must be in writing and the DRE must be notified at the time the appointment is made and if it is terminated. Please note that a broker does not have to appoint a branch manager under the Code; it is optional. However, if such an appointment is not made, the broker remains responsible for supervision of the day-to-day activities and operations of the brokerage.

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