Real estate practice moonlighting

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Sunday, August 10, 2014


OUR attention was caught by a news report recently televised in a local morning show concerning the situation of ambulant agents who offer clients accommodations for transient houses, hotels and other similar real properties. The local government through the City Tourism office intends to train, organize and accredit these persons as tourism guides and front liners to assist the city in the local tourism drive.

We do not have anything against this wonderful plan of the City Tourism Office to tap this group for tourism purposes. Our only concern is the aspect of their jobs as tourism guides that would fall under the practice of real estate. Offering clients accommodations for transient houses/boarding houses, hotels, apartments, pension houses and inns and similar business establishments is under the purview of real estate service practice.

Thus, any act/s is/are covered by a requirement that person/s engaged in such activities are required to secure their license as real estate broker or at the least as a real estate salesperson. This is mandated by the Real Estate Service Act (RESA), which was effected since July 30, 2009. Sec. 27, Rule IV of the Implementing Rules and Regulations (IRR) of RESA states: "Any single act or transaction embraced within the provisions of Section 3(g), Rule II hereof, as performed by real estate service practitioners, shall constitute an act of engaging in the practice of real estate service."

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Sec. 3(g) Rule I of RESA IRR defines the scope of functions of real estate brokers and real estate salespersons:

Real Estate Broker -- a duly registered and licensed natural person who, for a professional fee, commission or other valuable consideration, acts as an agent of a party in a real estate transaction to offer, advertise, solicit, list, promote, mediate, negotiate or effect the meeting of the minds on the sale, purchase, exchange, mortgage, lease, or joint venture, or other similar transactions on real estate or any interest therein.

Real Estate Salesperson -- a duly accredited natural person who performs service for, and in behalf of a real estate broker who is registered and licensed by the Professional Regulatory Board for or in expectation of a share in the commission, professional fee, compensation or other valuable consideration.

To be licensed as a real estate broker, RESA requires that every applicant seeking to be registered and licensed as a real estate service practitioner shall undergo an examination to be given by the PRB RES and supervised by PRC (Professional Regulation Commission). In order to be admitted to the licensure examination for real estate service, a candidate at the time for filing his/her application, shall establish to the satisfaction of PRB RES that he/she possesses the following qualifications:

1. Filipino citizen;

2. A holder of a college degree from any college or university recognized by CHED; provided that he/she has completed at least 120 credit units of real estate subject and training from accredited service providers; and

3. Is of good moral character, and not convicted of any crime involving moral turpitude.

To be licensed as a real estate salesperson, the real estate law requires that he/she be accredited as a real estate salesperson with PRB RES and PRC with these minimum requirements (Sec. 31 Rule IV RESA IRR: "For real estate salespersons, no examination shall be given, but they shall be accredited by the PRB RES provided that:

1. They have completed at least two (2) years of college; and

2. Have undergone training and seminars of at least twelve (12) credit units in real estate brokerage.

Real estate salespersons shall be under the direct supervision and accountability of a real estate broker. As such, they cannot by themselves be signatories to a written agreement involving a real estate transaction unless the real estate broker who has direct supervision and accountability over them is also a signatory thereto.

Aside from the above, no real estate salesperson, either directly or indirectly, can negotiate, mediate or transact any real estate transactions for and in behalf of a real estate broker without first securing an authorized accreditation as a real estate salesperson for the real estate broker, as prescribed by PRB RES. A real estate broker shall be guilty of violating the real estate law for employing or utilizing the services of a real estate salesperson when he/she has not secured the required accreditation from the PRB RES prior to such employment.

No salesperson shall be entitled to receive or demand a fee, commission or compensation of any kind from any person, other than the duly licensed real estate broker who has direct control and supervision over him, for any service rendered or work done by such salesperson in any real estate transaction.

Penal Provisions

Any violation of R.A. 9646, including violations of the IRR, shall be meted the penalty of a fine of not less than one hundred thousand pesos (P 100,000.00) or imprisonment of not less than two (2) years, or both such fine and imprisonment upon the discretion of the court. In case the violation is committed by an unlicensed real estate service practitioner, the penalty shall be double the aforesaid fine and imprisonment.

This means that the guilty party shall be meted the penalty of a fine of not less than two hundred thousand pesos (P 200,000.00) or imprisonment of not less than four (4) years, or both such fine and imprisonment upon the discretion of the court. (Sec. 39 Rule V of the RESA IRR).

Without any doubt the local government through the local tourism office had all the good intentions and actions in assisting our ambulant real estate agents to be formally accredited as licensed tourist guides and front liners. We only request and urge our good City Tourism Officer Mr. Benny Alhambra to look at this aspect of the task assigned to our tourist guides and front liners that would fall under the category of the practice of real estate.

The undersigned as well as our real estate AIPO - the Philippine Institute of Real Estate Service Practitioners, Inc (PhilRES), Baguio City Chapter headed by Mr. Toti Tagle and Benguet Chapter headed by yours truly, will be more than willing to assist these designated tourist guides and front liners engaged in the referrals for accommodations for transient/boarding houses and similar establishments for clients, secure their license as a real estate broker or at the least as a real estate salespersons.

(For comments, questions, queries, updates and other matters of concerns, you can email me at bert_capili@yahoo.com)

Published in the Sun.Star Baguio newspaper on August 11, 2014.

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