Nash, Eric C
Respondent(s): Eric C. Nash, Principal Broker, Nash Realty, Inc., Little Rock, Arkansas, Formal Hearing #3434
Violation(s): A.C.A. § 17-42-311(a)(2) and § 17-42-311(a)(13), and Commission Regulations 10.10(a) and 10.10(c)
Sanction(s): Respondent Nash was ordered to pay a $500.00 penalty to the Arkansas Real Estate Commission within thirty (30) days, and complete the Arkansas Real Estate Commission 45-hour broker pre-license course and the 30-hour broker post-license course.
On or about October 15, 2014, Respondent or a representative of Respondent’s firm prepared a Residential Lease/Rental Agreement, a Real Estate Contract and a Non-Representation Disclosure Addendum between two parties, neither of whom he was acting on behalf of as a real estate broker. Complainant Griffin owned the property identified in the agreements as 4521 Timberland Drive, Little Rock, AR.
On March 29, 2016, Respondent was offered a Consent Order in lieu of ordering a hearing.
On April 20, 2016, Respondent requested a formal hearing in lieu of agreeing to the Consent Order.
Complainant Griffin agreed to allow Gabon Contreras, a contractor to occupy her property at 4521 Timberland Drive, Little Rock, AR. Respondent Nash agreed to reduce Complainant’s agreement to writing.
On or about October 15, 2014 Respondent or a representative with Respondent’s firm prepared a Residential Lease/Rental Agreement which identified Complainant Tedra Griffin/Reginald E. Myers (RV LV Trust) as the authorized agent of the owner even though Complainant Tedra Griffin/Reginald E. Myers (RV LV Trust) was referred to as "Owner" of the subject property elsewhere in the agreement. The tenant was identified as Lucina Reyes-Lopez who was the mother of Gabon Conteras. Neither the Respondent, the Respondent’s firm, nor any agent licensed under the Respondent was identified as a broker, agent or property manager for the transaction.
The Residential Lease/Rental Agreement provided that the tenant would pay a security deposit of $5,000 which would be held by Management in a non-interest-bearing trust account. Complainant Griffin was identified on page 6 of the agreement as "Management as Authorized Agent of Owner". The buyer remitted Cashiers Check 5500818605 on Regions bank in the amount of $5,000 directly to Complainant Tedra Griffin/Reginald Eugene Myers Revocable Living Trust. Complainant Griffin never intended or agreed to deposit the security deposit into a non-interest bearing trust account and the proceeds were never held in a non-interest bearing trust account.
Paragraph 11. ALTERATIONS AND ADDITIONS: of the Residential Lease/Rental Agreement prohibited the tenant from making any alteration to the property without the express prior written permission of Management.
Paragraph 26. SPECIAL CONDITIONS. stated "This Contract acts as a Lease with Purchase Option. The buyer is required to put a 10% down payment towards the purchase price of $ 75,000 (sic). The $7500 is divided into two (2) installments. The $5000 down payment was received on 10/15/14 and the 2nd installment of $2500 will be paid on March 15, 2014. See Real Estate Contract (Residential) Serial # 028759-500141-3391667". The date for the 2nd installment was in error and should have read March 15, 2015.
On or about October 15, 2014 Respondent or a representative of Respondent’s firm prepared a Real Estate Contract (Residential), Serial number 028759-500141-3391667 which identified Complainant Tedra Griffin/R.E. Myers (RV LV Trust) as the seller and Lucina Reyes-Lopez as the buyer. The selection of Item E of paragraph 4 of the contract indicated there was no agency representation provided to the parties by Respondent, Respondent’s firm or any agent licensed under the Respondent.
Paragraph 3. PURCHASE PRICE: stated "The seller agrees to Owner Finance with 0% interest over a period of 5 years to Buyer with monthly installments of $775.00. See Lease Addendum." The closing date was set for October 31, 2019. The transaction did not involve a present conveyance of fee simple absolute between the parties.
Paragraph 3. PURCHASE PRICE: indicated the buyer was to pay $7,500 in cash at Closing as a down payment. Paragraph 23. POSSESSION, by the selection of Item B, the buyer’s possession was to occur after the buyer delivered the purchase price funds required to be executed pursuant to the terms of the contract. The buyer never paid the $7,500 down payment.
Gabon Conteraras, a contractor, had done work for Respondent’s real estate firm. After the contract was signed Conteraras began construction on the Complainant’s property. Complainant had not authorized Conteraras to perform construction or to alter the property.
On or about October 15, 2014 Respondent or a representative of Respondent’s firm prepared a Non-Representation Disclosure Addendum between Buyer/Lessee Lucina Reyes-Lopez and Complainant Tedra Griffin/Reginald E. Myers Revocable Living Trust.
POPE COUNTY BAR ASSOCIATION, INC v. SUGGS
274 Ark, 250, 624 S.W.2d 828 (1981)
Arkansas Supreme Court
SC-1.In Pope County Bar Association, Inc. v. Suggs, before the Arkansas Supreme Court, the Chancellor held that real estate brokers could fill in the blanks of certain standardized, printed forms in connection with simple real estate transactions, provided they had been previously prepared by a lawyer. The chancellor approved the use of standard warranty deeds, quitclaim deeds, release deeds, bills of sale, lease agreements and mortgages with power of sale under six specific restrictions:
(1) "That the person for whom the broker is acting has declined to employ a lawyer to prepare the necessary instruments and has authorized the broker to do so; and
(2) That the forms are approved by a lawyer either before or after the blanks are filled in but prior to delivery to the person for whom the broker is acting; and
(3) That the forms shall not be used for other than simple real estate transaction which arise in the usual course of the broker’s business; and
(4)That the forms shall be used only in connection with real estate transactions actually handled by such brokers as a broker; and
(5) That the broker shall make no charge for filling in the blanks; and
(6) That the broker shall not give advice or opinions as to the legal rights of the parties as to the legal effects of instruments to accomplish specific purposes or as to the validity of title to the real estate."
SC 2. By amendment, the decree was modified to define a "simple real estate transaction" as:
"…those which involve a direct, present conveyance of a fee simple absolute between parties, which becomes effective immediately upon delivery of the title document. Such transactions do not include conveyances involving reservations or provisions creating life estates, limited or conditional estates, contingent or vested remainders, fee tails, easements or right-of-way grants, or any other conveyance of future, contingent or limited interest."
NOTE: Due to this being a unique hearing regarding the Pope county case, the following applicable verbiage from the Conclusions of Law is included.
Respondent prepared a Residential Lease/Rental Agreement between two parties without acting as a broker for any party in the transaction. A restriction of Pope County Bar Association, Inc. v Suggs allows real estate brokers to complete forms used only in connection with real estate transactions actually handled by brokers as a broker. By completing a contractual agreement for a transaction in which he was not involved as a broker Respondent operated outside the usual course of a broker’s business. Respondent’s conduct constitutes improper dealings.
Respondent prepared a Real Estate Contract (Residential) and a Non-Representation Disclosure Addendum between two parties without acting as a broker for any party involved in the transaction. A restriction of Pope County Bar Association, Inc. v Suggs allows real estate brokers to complete forms used only in connection with real estate transactions actually handled by brokers as a broker. By completing a contract for a transaction in which he was not involved as a broker Respondent operated outside the usual course of a broker’s business.