CALIFORNIA LEGISLATION ADDRESSES THE USE OF TEAM NAMES IN REAL ESTATE. AGAIN
If recently-approved legislation has its intended effects, clarity will have finally been achieved regarding the rules for the use of team names by California real estate licensees. Whether there will be compliance with those rules may be another matter altogether.
The legislation, Senate Bill 146 (Galgiani), was approved by the Governor July 16. It is the culmination of efforts initiated by the Real Estate Commissioner in early 2013. The problem was, and in many instances still is, that consumers were frequently unable to determine the identity of the agent(s) or responsible party behind a team name. For example, if a consumer had a problem with something that was being done by the Surf’s-Up Team, he might have had no way of connecting that team to a particular brokerage or office. Nor would the Bureau of Real Estate (BRE).
The BRE’s initial solution was to require that team names be registered with the county as a fictitious business name (FBN), often referred to as a DBA (for “doing business as”). The FBN would be owned by the broker, but could, by contract, be used by a particular agent or agents. This, however, proved more than a little cumbersome. Ensuing legislation (AB 2018) sought to make matters more workable by stipulating that the most common types of team names — those containing the surname of a team member — did not have to be registered as an FBN.
Because of continuing unclarity, however, this year’s SB 146 was introduced. Now that it has passed there should be a set of rules that are clear and workable.
Here is a summary:
As before, an agent may file a team name as an FBN of the broker, and may use that team name with the consent of the broker.
A team name is not considered a fictitious business name and does not require an FBN filing, if the following three conditions apply.
(A) The name is used by two or more real estate licensees who work together to provide licensed real estate services, or who represent themselves to the public as being a part of a team, group, or association to provide those services.
(B) The name includes the surname of at least one of the licensee members of the team, group, or association in conjunction with the term ‘associates’, ‘group,’ or ‘team.’
(C) The name does not include any term or terms, such as ‘real estate broker,’ ‘real estate brokerage,’ ‘broker,’ or ‘brokerage’ or any other term that would lead a member of the public to believe that the team is offering real estate brokerage services, that imply or suggest the existence of a real estate entity independent of a responsible broker.”
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