R4-28-305 / R4-28-306. Temporary License, Certificate of Convenience, and Unlawful License Activity +17Arizona · Real Estate · English

Unlawful license activity includes performing licensed acts without an active license, acting on behalf of a broker other than one's employing broker, or a broker employing an unlicensed person. Those who commit it must submit explanations, statements, and documentation of compensation. Activity for over 30 days, with prior history, or a pending complaint may result in discipline.

• ✓Performing licensed acts without an active license or on behalf of the wrong broker is unlawful license activity
• ✓No prior history, activity 30 days or less, and no pending complaints results in an Advisory Letter of Concern rather than discipline
• ✓Activity over 30 days, prior history, or a pending complaint may result in disciplinary action under 32-2153

Applicants for a temporary cemetery salesperson's license, temporary broker's license, or membership camping certificate of convenience submit specified info and fee. The DB submits an affidavit that the applicant has been/will be trained in the applicable laws. A temporary broker serves 90 days to close down business or install a new DB.

• ✓The DB must submit an affidavit that the applicant is/will be trained in cemetery or membership camping and contract law
• ✓A temporary broker is appointed for 90 days to close down business or install a new designated broker

Rule R4-28-401 sets out prelicensure education requirements and waiver provisions that applicants must satisfy before taking the licensing examination.

• ✓Applicants must complete required prelicensure education hours before examination
• ✓Waivers of prelicensure education may be available in defined circumstances
• ✓Education must be from an approved real estate school

Rule R4-28-402 sets out continuing education requirements, waivers, and distance learning provisions required for license renewal.

• ✓Licensees must complete required continuing education hours each renewal period
• ✓Continuing education may include distance learning subject to rule requirements
• ✓CE covers mandatory topics including agency law, contract law, and fair housing

Rules R4-28-403 and R4-28-404 govern license examinations and real estate school requirements including course and instructor approval.

• ✓Applicants must pass the license examination (R4-28-403)
• ✓Real estate schools, courses, and instructors must be approved (R4-28-404)

Acting as a broker/salesperson (or advertising as one) without a license is a class 6 felony. Performing other acts requiring a license (non-broker/salesperson) without a license is a class 5 felony. Exceptions apply for good-faith late renewals, licensee acts within their capacity, and persons who discover a license is needed and promptly notify/apply/cease before a cease-and-desist order.

• ✓Unlicensed broker/salesperson activity is a class 6 felony
• ✓Other unlicensed licensed-activity is a class 5 felony
• ✓Exception for renewal within one year if failure was due to unintentional neglect or department delay
• ✓Exception for prompt notification, application, and cessation before a cease-and-desist order

A perpetual/endowed-care cemetery cannot advertise or sell plots as endowed until an irrevocable trust fund is established per a population-based schedule: $10,000 (under 10,000 people) up to $50,000 (50,000+ people) within a 15-mile radius. Advertising endowed care without the fund is prohibited.

• ✓Deposit ranges from $10,000 to $50,000 based on population within a 15-mile radius
• ✓Endowed care cannot be advertised or represented until the trust fund is established
• ✓Trustee must be an authorized financial institution with no cemetery ownership interest
• ✓Trust principal remains permanently intact; only income or unitrust amount is spent

Every perpetual/endowed-care cemetery must deposit into its trust fund within 30 days after each sale is paid in full: $2.75 per square foot per grave, $36 per niche, and $120 per crypt. A cemetery may also deposit up to 15% of the gross sales price.

• ✓Deposit $2.75 per square foot for each grave
• ✓Deposit $36 for each niche and $120 for each crypt
• ✓Deposits are due within 30 days after the contract is paid in full
• ✓A cemetery may additionally deposit up to 15% of the gross sales price

No certificate of authority issues to a cemetery corporation/LLC unless an irrevocable trust fund for maintenance and operation is established, with the written trust instrument and trustee receipt attached to the articles. Cemeteries operating before January 1, 1998 not previously required are exempt unless a material plan change occurs.

• ✓An irrevocable trust fund must be established before a certificate is issued
• ✓The written trust instrument and trustee receipt must be attached to articles
• ✓Pre-1998 cemeteries are exempt unless a material plan change occurs

Before offering courses toward licensure or renewal education requirements, a school must obtain a certificate of approval to operate (for at least four years) and a certificate of course approval for each course not already approved. Live classroom, distance learning, online, and continuing education courses are all subject to approval.

• ✓School must obtain a certificate of approval to operate for at least four years
• ✓Each course not currently approved for another school requires course approval

Applications for course approval must be filed at least 30 days before a live classroom course (90 days for distance learning). If not approved within the timeframe, a course is automatically provisionally approved for 180 days unless deficiencies were noted. Course approval lasts at least four years if content remains current.

• ✓Live classroom course approval filed at least 30 days before; distance learning 90 days before
• ✓Automatic provisional approval for 180 days if not timely approved absent noted deficiencies
• ✓Course approval is for at least four years if content remains current and substantially unchanged

The commissioner may withdraw or deny certification for acts inconsistent with the chapter, including failing to report violations, improperly certifying attendance/performance, teaching unapproved materials, filing false documentation, or teaching outdated/substantially changed content.

• ✓Improperly certifying student attendance or performance is grounds for withdrawal
• ✓Teaching unapproved materials or outdated/substantially changed content is grounds for withdrawal

Instructors must file for approval or renewal, valid for at least four years. In the 24 months before application, most instructors must attend at least a three-hour professional seminar or workshop emphasizing instruction methods, which the commissioner may waive on individual review.

• ✓Instructor approval is for at least four years
• ✓Most instructor applicants must attend a 3-hour professional seminar/workshop within 24 months before application

The aggrieved party must serve notice of the claim and application on the judgment debtor. The commissioner must receive the debtor's written response within 35 calendar days after the notice is mailed/delivered/first published, or the debtor waives objections. Licensed debtors may be served by certified mail; unlicensed debtors may require newspaper publication for two consecutive weeks.

• ✓Judgment debtor has 35 calendar days to respond to the claim notice
• ✓Failure to respond waives the debtor's right to object to payment
• ✓Licensed debtors served by certified mail; unlicensed via publication if needed

If an application is deficient, the commissioner mails an itemized deficiency list within 30 days; the claimant has 60 days to respond or the file closes. The commissioner must issue a final written decision within 90 days of a completed application, or the claim is deemed approved. Denied claimants may file in the underlying court within six months of the denial notice.

• ✓Deficiency list mailed within 30 calendar days of receiving application
• ✓Claimant has 60 calendar days to correct deficiencies or file closes
• ✓Final decision required within 90 days or claim deemed approved
• ✓Denied claimant may appeal to court within 6 months of denial notice

The commissioner may investigate timeshare violations, examine books/records, issue summary orders, and hold hearings. In cases of asset concealment or flight, the commissioner may seek a receiver or writ of ne exeat.

• ✓The commissioner may investigate and examine books/records of owners, agents, or developers upon complaint or on the commissioner's own motion
• ✓The commissioner may apply ex parte for a receiver or writ of ne exeat if assets or self are being concealed
• ✓Developers must reimburse the department for out-of-state or in-state investigation travel and subsistence expenses

Developers/agents are liable for untrue statements or fraud, with damages measured by amount paid less current value. Civil penalties range from $1,000 to $5,000 per infraction, brought by the attorney general.

• ✓Civil penalty is at least $1,000 and not more than $5,000 per infraction
• ✓Untrue statement/omission liability actions must be brought within one year of discovery; fraud within two years
• ✓No fraud action may be brought more than three years after the sale/lease

The article applies to in-state timeshare property and plans sold to individuals in the state. It does not apply to plans with fewer than 12 interests, plans under three years, or plans with total obligations under $1,500.

• ✓Does not apply to plans with fewer than twelve timeshare interests
• ✓Does not apply to plans lasting less than three years or with total obligation under $1,500
• ✓An exchange program is regulated as a timeshare plan if the total obligation exceeds $3,000 per recurring timeshare period

A developer or managing entity may pay a finder fee to an unlicensed person who owns a timeshare interest in that plan and provides a prospective purchaser's name, limited to $1,000 credit/nonmonetary compensation per twelve months.

• ✓Finder fees may only be paid to unlicensed persons who own a timeshare interest in that plan
• ✓Finder fees cannot exceed $1,000 in credit or nonmonetary compensation per twelve-month period
• ✓Unlicensed persons cannot advertise or promote their services in procuring purchasers

The commissioner may exempt timeshare plans by special order upon petition showing compliance is not essential to public interest due to special characteristics. The petition requires a $300 nonrefundable fee.

• ✓Exemption is granted by special order upon written petition showing compliance is not essential to public interest
• ✓Special orders must relate to specific timeshare plans
• ✓The petition fee is $300 and is nonreturnable regardless of outcome

Licenses issued under Title 32 do not expire while a National Guard or reserve member serves on federal active duty and are extended 180 days after return. Regular armed forces members receive a 180-day extension from expiration. Renewals during the extension incur only normal fees with no late/delinquency charges.

• ✓Licenses don't expire during federal active duty and extend 180 days after return
• ✓Regular armed forces members get a 180-day extension from expiration
• ✓Member must notify the issuing authority of active duty status
• ✓No late fees or delinquency fees during the extension period

An occupational/professional license shall be issued to a person establishing Arizona residence (or a military spouse without examination) if they are currently licensed in another state in the same discipline, licensed at least one year, met education requirements, passed required exams, have no disqualifying discipline/complaints, and pay applicable fees.

• ✓Applicant must be currently licensed and in good standing in another state in the same discipline
• ✓Applicant must have been licensed by another state for at least one year
• ✓Applicant must have no revoked license, pending complaints, or disqualifying criminal history
• ✓A state-laws examination may still be required except for military spouses under subsection A

Education, training, or experience requirements may be completely or partially satisfied by substantially equivalent military experience. Regulating entities must post policies easing licensing burdens (universal recognition, temporary licenses, fee waivers, exam exemptions) and maintain designated website areas for military spouses, service members, and veterans.

• ✓Military education/training/experience may satisfy licensing requirements if substantially equivalent
• ✓Regulating entities must post policies that ease licensing burdens on their website
• ✓Must have a designated website area for military spouses, service members, and veterans
• ✓Must track and report veteran/military spouse applicant data to the governor

Certain persons are exempt, including timeshare interest owners (or their brokers) reselling their own-use interest, and qualifying managing entities/associations reselling foreclosed/transferred interests with required disclosures.

• ✓Owners (or their brokers) reselling an interest acquired for their own use and occupancy are exempt
• ✓Qualifying managing entities/associations (not developers) reselling foreclosed/transferred interests must provide specified assessment and delinquency disclosures in conspicuous type
• ✓National publication/electronic media offers not directed at Arizona individuals are exempt; direct solicitation/email to a known Arizona resident is not exempt
• ✓A person acquiring 12+ interests and transferring 12+ to a single purchaser in one transaction is exempt

Specified communications are exempt from the article, including stockholder communications, certain unpaid media statements, disclaimed general advertising, transient rental materials, and billboards. Additional communications to existing owners/purchasers are exempt.

• ✓Stockholder communications, disclaimed general advertising, and passive billboards are exempt communications
• ✓Transient rental materials are exempt only if no sales presentation is required and failure to tour does not reduce services
• ✓Account communications, exchange program materials, and upgrade solicitations to existing owners/purchasers are exempt

Individual broker/salesperson licenses, renewals, modifications, and reinstatements have a 60-day overall time-frame (30/30/30/30). Entity licenses (corp/LLC/partnership/PC/PLC/designated broker), branch offices, temporary brokers, and membership camping certificates have a 120-day overall time-frame (60/30/60/60).

• ✓Individual broker/salesperson overall time-frame is 60 days
• ✓Entity, branch office, temporary broker time-frames are 120 days
• ✓School/course (live)/instructor approvals have a 30-day overall time-frame

A fee is charged for development site inspections under specified ARS sections, before or after issuance of a public report. Multiple inspections and fees may be required based on development circumstances.

• ✓Inspection fee applies before or after public report issuance
• ✓Multiple inspections and fees may be required

Advertising approvals for lotteries/drawings/contests/premiums have a 15-day overall time-frame (15/5/0/0). Development applications and Certificates of Authority take 100 days. Pre-license waivers take 45 days, continuing education waivers 12 days. Exemptions (subdivision, unsubdivided land, time-share, membership camping) take 80 days.

• ✓Lottery/drawing/contest advertising approvals: 15-day overall time-frame
• ✓Development application and Certificate of Authority: 100-day overall time-frame
• ✓Exemptions overall time-frame is 80 days; pre-license waiver 45 days; CE waiver 12 days

The commissioner may issue a temporary cemetery salesperson license (up to 90 days, one per person without exam) or a one-time 30-day membership camping certificate of convenience without examination, with the employing broker certifying by affidavit that the applicant has been/will be trained in applicable law.

• ✓Temporary cemetery salesperson license good up to 90 days; only one without examination per applicant
• ✓Membership camping certificate of convenience is a one-time 30-day certificate without examination
• ✓Employing broker must certify by affidavit that the applicant is trained in applicable law

This article governs actions to judicially review final agency decisions. Failure to timely seek review bars judicial review except to challenge jurisdiction.

• ✓The article governs every action to judicially review a final agency decision except public welfare decisions or where a separate act provides a definite review procedure
• ✓Failure to seek review within the time and manner provided bars parties from judicial review
• ✓If a decision becomes final due to failure to file a required document, it is not subject to judicial review except to question the agency's jurisdiction over person or subject matter

It is unlawful to offer or sell a membership camping contract within or from Arizona unless a final membership camping public report has been issued. Sales before issuance are voidable by the purchaser.

• ✓A final membership camping public report must be issued by the commissioner before offer or sale
• ✓Any sale before issuance of the final public report is voidable by the purchaser
• ✓The report requirement applies to sales within or from this state

The application requires extensive documentation including operator identity, officers/directors, financial statements audited by a CPA, advertising forms, contract copies, title reports, and disclosures of adverse orders and forfeiture grounds.

• ✓Financial statements must be prepared per GAAP and audited by an independent CPA
• ✓Must disclose officers, directors, material affiliates, and owners of over 10% of voting stock
• ✓Must include a current title report signed and dated not more than thirty days before commissioner receipt

The application must be signed by the operator, an officer, general partner, or authorized attorney-in-fact, submitted on a prescribed form with fee, and amended when material changes occur.

• ✓The application must be signed by the operator, officer, general partner, or power-of-attorney holder
• ✓The application must be submitted on the commissioner's prescribed form with the application fee
• ✓The application must be amended when a material change to previously filed information occurs

Rule R4-28-502 governs advertising by a licensee, requiring that advertising not be misleading and that it identify the employing broker.

• ✓All licensee advertising must include the employing broker's name
• ✓Advertising must not be false or misleading
• ✓Team and salesperson advertising must comply with broker identification requirements

Rules R4-28-503 and R4-28-504 govern promotional activities and development advertising requirements.

• ✓Promotional activities must comply with disclosure requirements (R4-28-503)
• ✓Development advertising is subject to specific content rules (R4-28-504)

All license applicants (including entity officers, directors, 10%+ owners, and controlling persons) must submit a signed questionnaire disclosing convictions, deferred judgments, adverse orders involving fraud/dishonesty or real estate business, license restrictions/suspensions/revocations, and injunctions related to real estate, securities, consumer fraud, or racketeering.

• ✓Applies to entity officers, directors, and 10%+ owners/controllers
• ✓Must disclose convictions, deferrals, adverse orders, license discipline, and injunctions
• ✓Disclosures must include misdemeanors and felonies

If disclosures are made, the applicant must provide a signed written statement, certified records including police/court records for each crime, certified documents on license discipline (last 10 years), civil judgments involving fraud, recovery fund payments, injunction orders, and supporting evidence of restitution.

• ✓Signed written statement describing circumstances required for each disclosure
• ✓Certified police and court records required for each crime
• ✓License discipline documents required for the last 10 years
• ✓Certified fingerprint clearance card required under A.R.S. 32-2108.01

The department will not issue a broker's license to a person holding an active salesperson's license; an active salesperson must sever or be administratively severed. Licenses bear the legal name plus approved nicknames/dba/corporate names, but professional corporations/PLLCs cannot adopt a dba name.

• ✓No broker's license to a person with an active salesperson's license in the state
• ✓Active salesperson must submit severance or request administrative severance
• ✓Professional corporation or PLLC cannot adopt a dba name
• ✓Salesperson/broker license requires experience/education per A.R.S. 32-2124

Every current licensee must file both the principal place of business (or statutory agent) address and a current residence address. Licensees must notify the commissioner in writing within 10 days of any change to disclosed criminal/disciplinary information. Licensees must respond to complaint investigation requests within 14 days.

• ✓Must file both business/statutory agent address and residence address
• ✓Notify commissioner within 10 days of change to disclosure information
• ✓Respond to complaint investigation requests within 14 calendar days

A broker management clinic consists of three courses of three hours each covering broker statute/rule requirements, designated broker obligations, supervision, recordkeeping, trust accounts, and risk management. Original broker license applicants must attend before activating the license, and designated brokers must attend before becoming designated (unless within the prior 23 months) and once every 24 months of licensure.

• ✓Broker management clinic consists of three 3-hour courses
• ✓Original broker license applicant must attend a clinic before activating the license
• ✓Designated/associate brokers must attend a clinic once every 24 months of licensure

If engaging in property management activities, a broker must complete a broker management clinic designed to teach proficiency in property management.

• ✓Brokers engaging in property management must complete a property-management-focused clinic
• ✓Clinic content may be designed to address property management, specialty fields, or sales activities

A broker management clinic consists of three courses of three hours each covering broker statutes, rules, audits, obligations, policy, supervision, recordkeeping, trust accounts, and risk management. Original broker applicants must attend before activating; designated brokers and certain associate brokers must attend once every 24 months. Property management brokers must complete a property-management-focused clinic.

• ✓A broker management clinic consists of three courses of three hours each
• ✓Original broker applicant must attend a clinic before activating the license
• ✓Designated brokers must attend a clinic once during each 24 months of licensure
• ✓Brokers engaging in property management must complete a clinic designed to teach property management proficiency

Failure to comply with all provisions of the recovery fund article waives rights. Recovery fund repayment does not limit or nullify other disciplinary action. The commissioner may require a real estate/cemetery licensee to post a surety bond (max $100,000, duration up to five years) if the licensee violated the chapter, was convicted of a qualifying crime, or had an administrative order entered.

• ✓Failure to comply with the article waives fund rights
• ✓Repayment does not limit separate disciplinary proceedings
• ✓Licensee bond principal not more than $100,000, duration not over 5 years
• ✓Certificate of deposit may substitute for the surety bond

Sums received are deposited in the recovery fund and held in trust. The commissioner may spend up to $50,000/year in interest to increase public awareness. Before payment, the claimant executes an assignment of judgment; the commissioner becomes subrogated to all judgment creditor rights, and recovered amounts return to the fund.

• ✓Fund held in trust; commissioner may spend up to $50,000/year on public awareness
• ✓Claimant must assign judgment before receiving payment
• ✓Commissioner is subrogated to judgment creditor rights upon payment
• ✓Attorney general brings recovery actions in the state's name

Before offering education-requirement courses, a school must obtain a certificate of approval to operate (at least four years) and a certificate of course approval for each course not already approved for another school. Each school is responsible for its content and administration. Course approval is for at least four years if content remains current.

• ✓School must obtain certificate of approval to operate for a period of at least four years
• ✓Each course not currently approved for another school requires a separate certificate of course approval
• ✓Course approval lasts at least four years if content remains current and substantially unchanged

The commissioner may withdraw or deny certification for acts inconsistent with the chapter, including failing to report violations, improperly certifying attendance, acts that are grounds for discipline under 32-2153, using unapproved materials, or filing false documentation.

• ✓Improperly certifying student attendance or performance is grounds for withdrawal
• ✓Teaching unapproved information/materials or filing false documentation is grounds for withdrawal
• ✓Schools may not offer unapproved courses for credit or use deceptive advertising

Applications must be filed at least 30 days before a live course (90 days for distance learning). Live course approval issues within 30 days; distance learning within 90 days. If not timely granted, courses are automatically approved provisionally for 180 days unless deficiencies noted.

• ✓Live classroom course applications must be filed at least 30 days before; distance learning at least 90 days before
• ✓Untimely approval results in automatic provisional approval for 180 days unless deficiencies noted
• ✓Distance learning courses must provide for student participation, feedback and remedial instruction

An instructor must file for approval or renewal, valid for at least four years. Instructor applicants (except panelists, guest speakers, attorneys, out-of-state instructors) must attend at least a three-hour approved professional seminar/workshop within 24 months before application.

• ✓Instructor approval is for at least four years after the date of approval
• ✓Instructor applicants must attend a 3-hour approved seminar within 24 months, unless exempt or waived