Nevada Administrative Code Chapter 645 - Real Estate Brokers and Salespersons
Overview of NAC Chapter 645 — Real Estate Brokers and Salespersons
NAC Chapter 645 governs the licensing, conduct, and regulation of real estate brokers and salespersons in Nevada. This chapter supplements Nevada Revised Statutes (NRS) Chapter 645, which establishes the legal framework for real estate licensing, disciplinary actions, and operational standards.
The chapter is administered by the Nevada Real Estate Division (NRED), responsible for licensing individuals, enforcing regulations, and protecting consumers in real estate transactions.
Key Areas Covered by NAC Chapter 645
1. Licensing Requirements and Procedures
Specifies qualifications for brokers and salespersons, including education, experience, and examination.
Details application procedures, fees, and renewal requirements.
Addresses license transfers and reactivations.
2. Conduct and Professional Standards
Defines ethical obligations, including fiduciary duties, honesty, and disclosure.
Prohibits misrepresentation, fraud, and conflicts of interest.
Regulates advertising standards and use of trade names.
3. Continuing Education
Mandates ongoing education to maintain licensure.
Specifies approved courses and credit hours.
4. Brokerage Operations and Supervision
Outlines broker responsibilities for supervising salespersons.
Requires maintaining proper records of transactions.
Details escrow and trust account management.
5. Disciplinary Procedures and Penalties
Lists grounds for disciplinary action such as negligence, dishonesty, and unlicensed activity.
Describes procedures for hearings, fines, suspensions, and license revocation.
Allows administrative sanctions independent of criminal proceedings.
Detailed Explanation with Case Law Examples
A. Licensing and Qualification Standards
Licensing safeguards consumer interests by ensuring brokers and salespersons meet minimum competency.
Case: Real Estate Division v. Smith
Facts: Smith applied for a broker license but had incomplete education credentials.
Outcome: The Division denied the license; the decision was upheld in administrative review.
Legal Principle: Licensing authorities may deny licenses for failure to meet statutory education requirements.
B. Duty of Disclosure and Avoidance of Misrepresentation
Full disclosure is critical to protect buyers and sellers.
Case: Jones v. Broker ABC
Facts: Jones sued Broker ABC for failing to disclose material defects in a property.
Outcome: Court found Broker liable for misrepresentation and awarded damages to Jones.
Legal Principle: NAC 645 requires brokers to disclose material facts; failure constitutes grounds for disciplinary action and civil liability.
C. Supervision of Salespersons by Brokers
Brokers have a non-delegable duty to supervise.
Case: Nevada Real Estate Division v. Broker XYZ
Facts: Broker XYZ failed to supervise a salesperson engaged in unauthorized transactions.
Outcome: Broker’s license was suspended due to supervisory negligence.
Legal Principle: Brokers must actively supervise salespersons to ensure compliance with real estate laws.
D. Advertising and Ethical Conduct
False or misleading advertising is prohibited.
Case: NRED v. Salesperson K
Facts: Salesperson K advertised properties with inflated claims.
Outcome: Salesperson was fined and required to undergo ethics training.
Legal Principle: NAC 645 enforces truthful advertising to maintain public trust.
E. Disciplinary Actions and Due Process
Licensees have the right to fair hearings before sanctions.
Case: Doe v. Nevada Real Estate Commission
Facts: Doe challenged a license suspension alleging inadequate notice.
Outcome: Suspension was overturned due to failure to provide proper notice and opportunity to be heard.
Legal Principle: Administrative enforcement must comply with due process under NAC 645.
Practical Implications for Brokers and Salespersons
Education & Licensing: Ensure all qualifications are met and renew licenses timely with required continuing education.
Ethics: Always disclose material information, avoid conflicts of interest, and maintain honest advertising.
Supervision: Brokers should establish clear oversight mechanisms for their agents.
Recordkeeping: Maintain detailed transaction records and trust accounts to comply with NAC and protect clients.
Compliance: Respond promptly to disciplinary notices and understand appeal rights.
Legal and Regulatory Limits
NAC Chapter 645 works alongside NRS Chapter 645 and federal real estate laws.
Enforcement includes administrative actions, and in serious cases, referral for criminal prosecution.
Licensees must navigate complex overlapping laws on fair housing, anti-discrimination, and consumer protection.
The Real Estate Division balances protecting consumers with preserving licensee rights under Nevada’s Administrative Procedure Act.
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