Senate Bill 5399 — Future Listing Right Purchase Contracts (Washington, 2023 Regular Session)

Summary

Senate Bill 5399 of the State of Washington, 2023 Regular Session, sponsored by Senators Mullet and Dozier. It was read first time on January 16, 2023 and referred to the Committee on Business, Financial Services, Gaming & Trade. The title describes an act relating to future listing right purchase contracts, amending RCW 18.86.010 and 18.86.070, adding a new section to chapter 18.86 RCW, and declaring an emergency. The bill adds definitions, provides that no future listing right purchase contract shall have a term greater than five years from the purchase date, and provides that such a contract may act as a lien on the property that may be perfected by recording.

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Full text

     S-0337.1

                               SENATE BILL 5399


     State of Washington       68th Legislature         2023 Regular Session

     By Senators Mullet and Dozier

     Read first time 01/16/23.       Referred   to   Committee   on   Business,
     Financial Services, Gaming & Trade.




1        AN ACT Relating to future listing right purchase contracts;
2    amending RCW 18.86.010 and 18.86.070; adding a new section to chapter
3    18.86 RCW; and declaring an emergency.


4    BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:


 5       Sec. 1. RCW 18.86.010 and 2013 c 58 s 1 are each amended to read
 6   as follows:
 7       Unless the context clearly requires otherwise, the definitions in
 8   this section apply throughout this chapter.
 9       (1) "Agency relationship" means the agency relationship created
10   under this chapter or by written agreement between a real estate firm
11   and a buyer and/or seller relating to the performance of real estate
12   brokerage services.
13       (2) "Agent" means a broker who has entered into an agency
14   relationship with a buyer or seller.
15       (3) "Broker" means broker, managing broker, and designated
16   broker, collectively, as defined in chapter 18.85 RCW, unless the
17   context requires the terms to be considered separately.
18       (4) "Business opportunity" means and includes a business,
19   business opportunity, and goodwill of an existing business, or any
20   one or combination thereof when the transaction or business includes
21   an interest in real property.
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 1       (5) "Buyer" means an actual or prospective purchaser in a real
 2   estate transaction, or an actual or prospective tenant in a real
 3   estate rental or lease transaction, as applicable.
 4       (6) "Buyer's agent" means a broker who has entered into an agency
 5   relationship with only the buyer in a real estate transaction, and
 6   includes subagents engaged by a buyer's agent.
 7       (7)   "Confidential  information"   means   information  from  or
 8   concerning a principal of a broker that:
 9       (a) Was acquired by the broker during the course of an agency
10   relationship with the principal;
11       (b) The principal reasonably expects to be kept confidential;
12       (c) The principal has not disclosed or authorized to be disclosed
13   to third parties;
14       (d) Would, if disclosed, operate to the detriment of the
15   principal; and
16        (e) The principal personally would not be obligated to disclose
17   to the other party.
18        (8) "Contract purchase price" means the amount of moneys paid to
19   the seller as consideration for entering into a future listing right
20   purchase contract.
21        (9) "Dual agent" means a broker who has entered into an agency
22   relationship with both the buyer and seller in the same transaction.
23        (((9))) (10) "Future listing right purchase contract" means a
24   contractual right to obligating a seller to enter into a real estate
25   listing agreement with a purchasing company in the future relating to
26   the sale of a residential home, townhouse, or condominium.
27        (11) "Material fact" means information that substantially
28   adversely affects the value of the property or a party's ability to
29   perform its obligations in a real estate transaction, or operates to
30   materially impair or defeat the purpose of the transaction. The fact
31   or suspicion that the property, or any neighboring property, is or
32   was the site of a murder, suicide or other death, rape or other sex
33   crime, assault or other violent crime, robbery or burglary, illegal
34   drug    activity,  gang-related  activity,   political  or   religious
35   activity, or other act, occurrence, or use not adversely affecting
36   the physical condition of or title to the property is not a material
37   fact.
38        (((10))) (12) "Principal" means a buyer or a seller who has
39   entered into an agency relationship with a broker.


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 1       (((11))) (13) "Purchase date" means the date on which the
 2   contract purchase price is transferred to the seller by the company
 3   either by personal delivery or via wire, ACH, or other electronic
 4   means, or mailed by insured, certified, or registered United States
 5   mail.
 6       (14) "Purchasing company" or "company" means a person or entity
 7   that enters into a future listing right purchase contract.
 8       (15) "Real estate brokerage services" means the rendering of
 9   services for which a real estate license is required under chapter
10   18.85 RCW.
11       (((12))) (16) "Real estate firm" or "firm" have the same meaning
12   as defined in chapter 18.85 RCW.
13       (((13))) (17) "Real estate transaction" or "transaction" means an
14   actual or prospective transaction involving a purchase, sale, option,
15   or exchange of any interest in real property or a business
16   opportunity, or a lease or rental of real property. For purposes of
17   this chapter, a prospective transaction does not exist until a
18   written offer has been signed by at least one of the parties.
19       (((14))) (18) "Seller" means an actual or prospective seller in a
20   real estate transaction, or an actual or prospective landlord in a
21   real estate rental or lease transaction, as applicable.
22       (((15))) (19) "Seller's agent" means a broker who has entered
23   into an agency relationship with only the seller in a real estate
24   transaction, and includes subagents engaged by a seller's agent.
25       (((16))) (20) "Subagent" means a broker who is engaged to act on
26   behalf of a principal by the principal's agent where the principal
27   has authorized the broker in writing to appoint subagents.

28       Sec. 2. RCW 18.86.070 and 2013 c 58 s 8 are each amended to read
29   as follows:
30       (1) The agency relationships set forth in this chapter commence
31   at the time that the broker undertakes to provide real estate
32   brokerage services to a principal and continue until the earliest of
33   the following:
34       (a) Completion of performance by the broker;
35       (b) Expiration of the term agreed upon by the parties;
36       (c) Termination of the relationship by mutual agreement of the
37   parties; or



                                     p. 3                          SB 5399
 1       (d) Termination of the relationship by notice from either party
 2   to the other. However, such a termination does not affect the
 3   contractual rights of either party.
 4       (2) No future listing right purchase contract shall have a term
 5   greater than five years from the purchase date.
 6       (3) Except as otherwise agreed to in writing, a broker owes no
 7   further duty after termination of the agency relationship, other than
 8   the duties of:
 9       (a) Accounting for all moneys and property received during the
10   relationship; and
11       (b) Not disclosing confidential information.

12       NEW SECTION.   Sec. 3.   A new section is added to chapter 18.86
13   RCW to read as follows:
14       A future listing right purchase contract may act as a lien on the
15   property to which it relates and may be perfected by recording in the
16   same manner that an easement, mortgage, or other interest in real
17   property is recorded. All liens shall take priority by normal
18   operation of law. Notwithstanding the foregoing, any such lien shall
19   be subordinate to a financing, refinancing, or home equity line of
20   credit the seller should seek subsequent to the effective date of the
21   future listing right purchase contract.


22       NEW SECTION.   Sec. 4.  This act is necessary for the immediate
23   preservation of the public peace, health, or safety, or support of
24   the state government and its existing public institutions, and takes
25   effect immediately.

                                  --- END ---




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