Real estate brokers: limited liability companies.

Existing law, the California Revised Uniform Limited Liability Company Act, authorizes a limited liability company to have any lawful purpose, except as specified. A limited liability company is an entity distinct from its members. Existing law authorizes a limited liability company to render services that may be lawfully rendered only pursuant to a license, certificate, or registration authorized by the Business and Professions Code, the Chiropractic Act, the Osteopathic Act, or the Yacht and Ship Brokers Act, if those provisions authorize a limited liability company to hold that license, certificate, or registration. Existing law prohibits the act from being construed to permit a limited liability company to render professional services, as defined. Under existing law, a limited liability company is a member-managed limited liability company unless the articles of organization. Under existing law, the operating agreement governs, among other things, relations among the members as members and between the members and the limited liability company and the activities of the limited liability company. Existing law authorizes a written operating agreement to provide for the appointment of officers. Existing law, the Real Estate Law, provides for the licensure and regulation of real estate brokers by the Real Estate Commissioner, the chief officer of the Bureau of Real Estate. Existing law authorizes a real estate broker license to be issued to an individual or a corporation. Under existing law, when a real estate license is issued to a corporation, if it desires any of its officers other than the specified designated officer to act under its license as a real estate broker, it is required to obtain an additional license to employ each of those additional officers. Under existing law, each officer of a corporation through whom it is licensed to act as a real estate broker is, while so employed under that license, a licensed real estate broker, but licensed only to act as such for and on behalf of the corporation as an officer. Existing law requires applicants for licensure as a real estate broker and real estate broker licensees to pay application, licensure, and renewal fees, which are deposited in the Real Estate Fund, a continuously appropriated fund. Existing law also authorizes the commissioner to take disciplinary action against a real estate licensee, including the imposition of a monetary penalty, which is also deposited in the Real Estate Fund. A willful violation of the law and other related real estate provisions is a crime. This bill would authorize a limited liability company to be licensed as a real estate broker. When a real estate license is issued to a limited liability company that desires any of its members, managers, or officers other than the designated member, manager, or officer to act under its license as a real estate broker, the bill would require the limited liability company to obtain an additional license to employ each additional member, manager, or officer. The bill would provide that each member, manager, or officer of a limited liability company through whom the company is licensed to act as a real estate broker is, while employed under license, a licensed real estate broker, but licensed only to act as such for and on behalf of the limited liability company as a member, manager, or officer. The bill would make various other conforming changes in this regard. Because new application, licensure, and renewal fees for limited liability companies would be deposited in the Real Estate Fund, a contiguously appropriated fund, the bill would make an appropriation. However, the bill would exclude money in the Real Estate Fund attributable to administrative fines, civil penalties, and criminal penalties imposed by the bureau against a limited liability company broker, or attributable to cost recovery in actions or settlements, from being continuously appropriated, and would instead make that money subject to appropriation by the Legislature. Because a willful violation of the law and other related real estate provisions by a limited liability company would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.