Utah Admin. Code R162-2f-202e - Procedure to Designate an Acting Principal Broker

(1) The division may inactivate the registration of a real estate brokerage if, upon the death or in capacity of its principal broker, the real estate brokerage fails to replace the principal broker within 14 days.

(2) The real estate business activities of an inactive brokerage may not continue and each licensee affiliated with the principal broker must stop any activity that requires a real estate license, until:

(a) the brokerage appoints another principal broker;

(b) the licensee affiliates with another principal broker; or

(c) an acting principal broker for the brokerage is qualified and designated.

(3) Before the death or incapacitation of a principal broker, a brokerage may identify in a written instrument signed by the owners of the brokerage an individual to become the acting principal broker to take effect when the principal broker dies or becomes incapacitated.

(a) If the designated acting principal broker is an associate broker within the brokerage, this individual will become the acting principal broker upon notifying the division.

(b) If the designated acting principal broker is not an associate broker within the brokerage, this individual will become the acting principal broker upon the approval of the commission.

(4) Following the death or incapacity of its principal broker, a real estate brokerage may, within 14 days:

(a) appoint another principal broker; or

(b) designate an associate broker affiliated with the brokerage to act as the principal broker.

(5) The commission, with the concurrence of the division, may designate an individual to act as principal broker giving preference to individuals in the following order:

(a) a licensee currently affiliated with the real estate brokerage;

(b) a licensee from another registered real estate brokerage;

(c) an attorney representing the real estate brokerage; or

(d) any other person designated by the commission.

(6) An acting principal broker may close out those transactions, listings, purchase contracts, and property management agreements that are active or pending when an incident occurs that requires the designation of an acting principal broker.

(7) An acting principal broker may not:

(a) agree to represent new clients; or

(b) continue the business activities of the brokerage for more than four months after the occurrence of the death or incapacity of the principal broker.

(8) The acting principal broker shall:

(a) maintain or supervise each escrow or trust account until the money is transferred or disbursed as agreed;

(b) arrange for pending transactions to be closed; and

(c) notify in writing the following persons of the individual's designation as acting principal broker;

(i) each licensee affiliated with the deceased or incapacitated principal broker; and

(ii) each client and party to a pending real estate contract.

Notes

Utah Admin. Code R162-2f-202e

Adopted by Utah State Bulletin Number 2023-17, effective 8/16/2023