CALIFORNIA ASSOCIATION OF REALTORS® BOARD OF DIRECTORS 531st SESSION MAY 6 - 7, 2011
The following is a summary of the significant action items approved by the CALIFORNIA ASSOCIATION OF REALTORS® Board of Directors at its Spring 2011 meeting. Some additional information items are included, but do not necessarily represent Association policy. A complete set of minutes is available for review upon request.
C.A.R. Scholarship Foundation/C.A.R. Education Foundation 1. It was reported for information only that the C.A.R. Scholarship Foundation awarded scholarships totaling $18,000.
California REALTOR® EXPO Advisory 1. It was reported for information only that the California REALTOR® EXPO will take place in San Jose from September 20-22, 2011. The theme is E3: Education, Enrichment and Empowerment.
1. It was reported for information only that, per the CREPAC Bylaws, the following slate is duly noticed for approval at the Fall 2011 Business Meetings. Trustees serve for a three-year term. Alternates may be selected to fill the remainder of a vacant term during the year.
NOMINEES FOR CREPAC TRUSTEE
(November 2011 - November 2014)
Gene Lentz, Region 9
Barbara J. Palmer, Region 10
Gregory Pawlik, Region 17
Steve White, Region 18
Evelyn Arnold, Region 22
NOMINEES FOR CREPAC ALTERNATE
(November 2011 - November 2012)
Nelson Janes, AE, Region 3
Terriann McGowan, Region 4
Cheryl McFall, Region 7
Debbie Rodgers, Region 11
Don Scordino, Region 12
Thomas Berge, Region 16
Geoffrey Craighead, Region 25
Robert Pahlke, Region 29
Distressed Properties Task Force
1. (Mark to Market)
That C.A.R., in conjunction with NAR, “SPONSOR” legislation that advocates/requires for lenders and investors to reintroduce mark-to-market accounting for certain distressed mortgage backed assets.
2. (Mandatory Response to Short Sale Request)
That C.A.R., in conjunction with NAR, "SUPPORT" H.R. 1498, the Prompt Decision for Qualification of Short Sale Act.
3. (Safe Harbor)
That C.A.R., in conjunction with NAR, “SPONSOR” legislation to create a safe harbor for servicers and lenders that will protect them from liability to investors when they approve a short sale, so long as note holders/investors are treated at least as well as the servicers’ own portfolios.
4. (Lender Recourse)
That C.A.R., in conjunction with NAR, “SPONSOR” legislation requiring a lender to waive any personal recourse against a borrower when it accepts any consideration for approving a short sale.
1. That C.A.R. “NOT FAVOR” AB 534 (Swanson) which specifies that homeless persons are entitled to the rights set forth under civil rights law.
1. That the Bylaws amendments to the IMPAC Bylaws be approved as presented.
Note: The proposed bylaws amendment clarifies who may be non-voting members of the Board of Trustees of IMPAC. The amendment includes the California NAR Issues Mobilization Committee Trustee, instead of the California RPAC representative, which is NAR’s candidate PAC.
2. It was reported for information only that, per the Bylaws, the following slate is duly noticed for approval at the Fall 2011 business meetings. Trustees serve for a three-year term. Alternates may be selected to fill the remainder of a vacant term during the year.
NOMINEES FOR IMPAC TRUSTEE
(November 2011 - November 2014)
Michael Godfrey, Region 6
Lynn Heintz, Region 12
Carol Banner, Region 15
Carl San Miguel, Region 19
Pat Fredericks, Region 28
NOMINEES FOR IMPAC ALTERNATE
(November 2011 - November 2012)
Anita Thede, Region 6
Lisa Muetterties, Region 7
Kimberly DiBenedetto, Region 10
Robert Kronovet, Region 17
Stephen Hanleigh, Region 19
Larry Black, Region 23
Paula Cosenza, Region 32
3. The IMPAC Trustees approved the following funding requests:
2/10/2011 - Orange County Association of REALTORS®: $25,000 for Yes on Measure A to support a local planning measure on the March 8, 2011 special election ballot, and approve the request for a total of $5,000 from 3 interboard solicitations.
5/3/2011 - Pacific Legal Foundation: $25,000 to support their litigation program in support of private property rights.
5/3/2011 – Orange County Association of REALTORS®: $20,000 to Yes on Measure B on the June 2011 ballot to uphold the approval of a mixed use development.
5/3/2011 – Orange County Association of REALTORS®: Approval of three interboard solicitations that will amount to $2,000 in contributions toward the Yes on Measure B campaign.
Land Use and Environmental
1. That C.A.R. take a "WATCH" position on AB 37 (Huffman), a bill that would require utilities to provide alternatives to the installation of Smart Meters.
2. That C.A.R. take a "NOT FAVOR" position on AB 1183 (Berryhill), a bill that makes the Attorney General the only party with standing to challenge a certified Environmental Impact Report (EIR).
Legal Action Fund
1. That the Bylaws amendments to the Legal Action Fund Bylaws be approved as presented.
Note: The C.A.R. Legal Action Fund is composed of 11 trustees who are appointed for five years by the C.A.R. President. The current Legal Action Fund bylaws contain limits on consecutive terms of the trustees. This amendment addresses the issue of partial terms and allows reappointment to a consecutive term if the prior partial term was less than two years. All other trustees will be ineligible for appointment unless a full year has elapsed since their prior term.
2. It was reported for information only that, since January, the Trustees reviewed 7 cases and approved filing briefs or letters as follows:
Wherry v. Century 21 Award. A salesperson filed a lawsuit alleging sexual harassment in violation of the Fair Employment and Housing Act (FEHA). The broker moved to compel arbitration using the arbitration clause in C.A.R.’s Independent Contractor agreement. Both the trial court and the Court of Appeal struck down the arbitration clause as an unenforceable contract of adhesion treating the clause as they are typically treated in employment relationships. An employment case on a FEHA matter previously held that employer-employee mandatory arbitration must have a number of additional protections for employees. Hearing was sought before the California Supreme Court and the trustees authorized a letter supporting the petition for review. Hearing was denied so the appellate court decision striking down the arbitration clause in the CAR Independent Contractor agreement stands. Therefore, clause in C.A.R.’s Independent Contractor is under consideration by the Standard Forms Advisory Committee to determine 1) whether to remove the clause altogether, 2) make it into a voluntary post-dispute arbitration clause, 3) create an enforceable addendum with binding arbitration or other options. Note, this case does not impact the buyer-seller arbitration clauses.
Tierstein v. Reiser. This case involved a conversation between a prospective buyer of a property (who also was a real estate licensee) and the owner of an adjacent property below who had trees, that if not kept trimmed, would block his view. It was alleged that the existing neighbor said he would keep his trees trimmed or let the new buyer trim them himself if he didn’t do it. There was no written agreement and the buyer bought the view property. An issue between their children occurred and the owner stopped trimming the property and would not let his neighbor trim them. Tierstein sued and was awarded not only the value of the “view easement” but also a license to be allowed to trim the trees as long as he owned the property. Reiser appealed. The Trustees authorized an amicus brief on the issue of whether conversations are enforceable property rights when there is no writing.
Alcoser v. Thomas. In an unpublished case, the California Court of Appeal upheld a jury verdict and damages award (reduced to from over $300,000 plus $5,490,566 in punitive damages to almost $200,000 plus $1 million in punitive damages for bad faith wrongful withholding of deposits, fraud and unfair business practices in a case involving over 200 persons in a class action against the landlord in addition to the plaintiffs being award of over $1.6 million in attorneys fees. While the Trustees did not authorize a letter supporting review of the unpublished case by the California Supreme Court, if the California Supreme Court does take the case, the Trustees will consider whether to file a brief on the punitive damage or refund penalty calculation issues depending on how the issue is framed for the Court.
1. That the following applicants be granted C.A.R. Honorary Member-for-Life status:
Bay East AOR
California Desert AOR
Central Valley AOR
Citrus Valley AOR
Conejo Simi Moorpark AOR
Greater Antelope Valley AOR
Hemet-San Jacinto BOR
Kings County BOR
Mariposa County BOR
Northern California Comm AOR
Orange County AOR
Pacific West AOR
Pismo Coast AOR
San Diego AOR
Scenic Coast AOR
Silicon Valley AOR
South Bay AOR
Ventura County Coastal AOR
Victor Valley AOR
MLS/Computer and Business Technology
1. That upon final approval by NAR, C.A.R. Model MLS Rule 13.2.2 Lockbox Type Requirements be revised as set forth below and assigned placement within Tier 2 of the Model Citation Policy:
13.2.2 Lockbox Type Requirements. Participants and Subscribers who utilize lockboxes
or other access devices(and so indicate on the MLS) shall use the designated or authorized lockbox required by the MLS where the listing is submitted.
More than one lockbox or access device may be used on a property as long as one of them is the lockbox designated or authorized by the MLS where the listing is submitted.
1. That the following be designated to serve as State Allocated NAR Directors for a three year term ending November 2014 and as Alternates for the 2012 elective year.
LeFrancis Arnold, Rancho Southeast, Region 22
Robert Bailey, Santa Cruz, Region 10
Melanie Barker Yosemite Gateway, Region 12
Bill Brown, Bay East, Region 6
Jim Hamilton, Silicon Valley, Region 9
Tashia Hinchliffe, South Bay, Region 21
Chris Kutzkey, Siskiyou, Region 2
Vincent Malta, San Francisco, Region 8
Beth L. Peerce, Southland Regional, Region 18
Rick Violett, Pacific West, Region 23
Alternates for 2012 (in priority order)
Geoff McIntosh, Pacific West, Region 23
Jeanne Radsick, Bakersfield, Region12
John Yen Wong, San Francisco, Region 8
Mike Teer, Pacific West, Region 23
Cynthia Carley, Rim O’ The World, Region 15
Tamara Suminiski, South Bay, Region 21
Mel Wilson, Southland Regional, Region 18
Carolyn D’Agosta, North San Diego County, Region 29
2. That the following individuals be elected as Directors For Life:
Paula Colombo, Sacramento, Region 3
Irene Reinsdorf, Southland Regional, Region 18
John Yen Wong, San Francisco, Region 8
3. That Joel S. Singer be elected as Chief Executive Officer/State Secretary for the year 2012.
4. That Chris Kutzkey be elected as Treasurer for the years 2012 - 2013.
5. That Don Faught be elected as President-Elect for the year 2012.
6. It was reported for information only that, per the Bylaws, President-Elect LeFrancis Arnold will serve as 2012 President.
Professional Standards Committee
1. That C.A.R. advocate a position to NAR that NAR amend Article 17 to give local associations the option to require that their REALTOR® members mediate a dispute before they can arbitrate.
2. That C.A.R. advocate a position to NAR that NAR expand its policy, so that a suspension or expulsion that is imposed by a local A.O.R. for violation of the Code of Ethics or membership duty shall be mandatorily reported to the state association to be reviewed by a panel of state directors, for possible enforcement on a state-wide basis.
Standard Forms Advisory
1. There were 7 Regional Representatives present at the Standard Forms Advisory Committee (SFAC) meeting. A few of the Regional Representatives cited confusion regarding use of the MARSSSN and MARSMRN forms. Clarification was provided regarding C.A.R.’s position in light of the fluid nature of the discussions between FTC and NAR. Additional comments were received and subsequently discussed by the SFAC. The SFAC reviewed 2 new drafts, the Independent Contractor Agreement (ICA) and the Septic Inspection, Well Inspection, Property Monument & Allocation of Cost Addendum (SWPI). The SFAC decided to strike the last sentence of paragraph 1D that was proposed in the SWPI draft and make other changes. The modified draft will be sent to the Land Use and Environmental Committee to gather more input. The SWPI form is anticipated for release in November, 2011. The ICA will also undergo some changes and will be published in an interim forms release. The SFAC will take into consideration recommendations from the Legal Action Fund Trustees. It was also reported to the SFAC that Strategic Planning and Finance approved funding for a new pilot ‘local library’ program. Under this program, C.A.R. would work with local brokers and attorneys to provide/create localized disclosure documents to members for a fee via zipForm® 6. Many of the rules and details will be identified through the pilot program. The program will require coordination with local REALTORS® as well as attorneys to ensure the documents are both relevant and legally valid. The value of this program will be measured at the conclusion of 2011. The SFAC received a brief report from the chair of the C.A.R. San Francisco (CARSF) subcommittee. This subcommittee reports to the SFAC regarding local San Francisco forms that were created and made available to membership statewide. The Property Management study group will meet over the summer to discuss proposed property management products and additional forms standardization. Another study group titled the Probate Study group was approved earlier this year. The SFAC received volunteers to participate on a Probate Study group and they will meet over the summer. Additionally, the SFAC will embark on a new initiative to build greater cohesion for the creation of C.A.R. Standard Forms that will encompass the features and capabilities of zipForm® 6. The committee decided to create a study group to address many technology issues with the goal to integrate zipForm® in the forms release process. Finally, the SFAC reviewed 16 of the 66 comments received, and will have a conference call in early June to review the balance of the comments.
Strategic Planning and Finance
1. That $35,000 be approved for a pilot program that would work with a few local areas that want local forms on zipForms. The pilot program would involve local standard forms committees, local attorneys, and AEs from market areas who wish to participate. Once there are a significant number of forms, the libraries would be available on a fee basis, likely based on regional areas to be determined by the market areas.
2. That C.A.R. allocate $25,000 to the AREAA Foundation in support of the organization’s Japanese Earthquake Relief Fund.
3. That C.A.R. allocate up to $25,000 in matching funds from California REALTORS®, AORS, and affiliates to the AREAA Foundation in support of Japanese Earthquake Relief efforts.
4. That C.A.R. allocate $100,000 from the C.A.R. Disaster Relief Fund to assist the Alabama REALTORS® affected by the recent disaster.
5. That the audited Statement of Operating Income and Expenses by program for the twelve months ended December 31, 2010 be approved.
Operating revenue of $27,474,500
Operating expenses of $24,890,400
An excess of operating income over expenses of $2,584,100
Political Activities Fund
An excess of income over expenses of $1,852,700
Issues Action Fund
An excess of income over expenses of $895,700
This amount will be allocated to IMPAC as approved by the Directors.
The C.A.R. Balance Sheet as of December 31, 2010
Total assets of $62,724,700 (of which $48,571,000 are current assets)
Total liabilities of $4,954,200 (of which $3,196,800 are current liabilities)
C.A.R. Fund Balance of $57,770,500
6. That the Statement of Operating Income and Expenses by program for the three months ended March 31, 2011 be approved.
Operating Revenue of $17,252,200
Operating Expenses of $5,441,200
An excess of operating income over expenses of $11,811,000
Political Activities Fund
An excess of income over expenses of $2,656,700
Issues Action Fund
An excess of income over expenses of $1,204,800
REALTOR® Action Assessment totaling $6,790,000
The C.A.R. Balance Sheet as of March 31, 2011
Total assets of $82,566,200 (of which $68,213,500 are current assets)
Total liabilities of $11,795,400 (of which $11,523,400 are current liabilities)
C.A.R. Fund Balance of $70,770,800
7. That the Projected Statement of Operating Income and Expenses by program for the year ending December 31, 2011 be approved.
Operating Revenue of $24,820,700
Operating Expenses of $25,794,500
An excess of operating expenses over income of $973,800
Political Activities Fund
An excess of income over expenses of $1,187,900
Issues Action Fund
An excess of income over expenses of $851,400. This amount will be allocated to IMPAC as approved by the Directors.
REALTOR® Action Assessment totaling $7,538,800
8. C.A.R. Check Signing Policy: That the following persons be approved as authorized signers for checks in conformity with the C.A.R. Bylaws:
Checks under $10,000, and for the payment of withholding taxes or transfer of funds from one Association account to another regardless of amount, shall be signed:
Using the facsimile signature of the Association Chief Executive Officer/State Secretary
By any two (2) of the following Association staff members authorized to execute checks by the Board of Directors: Joel S. Singer, Helen Parrino, Mary Martinez, Lynette Flores or Paula Green.
Checks of $10,000 or more shall be signed by:
--The President, President-Elect or Treasurer of the Association.
--The facsimile signature of the Association Chief Executive Officer/State Secretary OR the actual signature of (1) of the following Association staff members authorized to execute checks by the C.A.R. Board of Directors: Joel S. Singer, Mary Martinez, Helen Parrino, Lynette Flores or Paula Green.
Allowance to Sign Only in Single Capacity. As to any requirement set forth in these Check Signing Policies, in the event that any one person serves in multiple capacities or positions (ex: Association Chief Executive Officer or a staff member), he or she shall only be permitted to sign in a single capacity.
Transaction and Regulatory
1. (GSE Refinance Legislation)
That C.A.R., in conjunction with NAR, "SUPPORT" legislation that temporarily allows all Fannie Mae and Freddie Mac borrowers to refinance their current mortgages at today's lower interest rates regardless of their current loan-to-value (LTV), but not to include a reduction of principal.
2. That C.A.R. "SUPPORT” SB 53, Calderon, as amended to ensure due process protections for licensees in DRE disciplinary actions and to include a $2500 cap on fines made as part of the DRE citation and fine authority
3. That C.A.R. "SUPPORT" SB 376, Fuller, a bill to allow real estate licensees with a Mortgage Loan Originator endorsement to originate loans secured by personal property manufactured housing.
4. It was reported for information only that direction was given to staff to seek enhanced guidance from C.A.R. Legal, including a Q&A, regarding marijuana-related issues raised in the Lake County AOR letter.
5. It was reported for information only that C.A.R. will continue to “OPPOSE UNLESS AMENDED” SB 706, Price, a bill that will make structural changes in the DRE discipline process.
1. That C.A.R. “OPPOSE UNLESS AMENDED” SB 653 (Steinberg) to not include service fees or real estate income. SB 653 would authorize the board of supervisors of any county or city and county, by ordinance or resolution, to propose to the voters a tax, including a local personal income tax, a local corporate income tax, and a local sales and use tax.
2. That C.A.R. formally express its appreciation to Helen Parrino for her decades of service to C.A.R., and wish her well on the occasion of her retirement.