(2) A licensed real estate property manager, or a principal real estate broker who engages in the management of rental real estate, shall open and maintain in this state one or more separate federally insured bank accounts that are designated clients’ trust accounts under ORS 696.245. A principal real estate broker who engages in the management of rental real estate or a licensed real estate property manager shall deposit in a clients’ trust account all trust funds received or handled by the principal real estate broker, licensed real estate property manager or real estate licensees subject to the supervision of the principal real estate broker.
(3)(a) A principal real estate broker who receives or handles trust funds and does not deposit the trust funds in a licensed neutral escrow depository as described in paragraph (b) of this subsection shall open and maintain in this state one or more separate federally insured bank accounts that are designated clients’ trust accounts under ORS 696.245. Pursuant to written agreement of all parties to a real estate transaction having an interest in the trust funds, the principal real estate broker shall immediately place the trust funds in a clients’ trust account.
(b) A principal real estate broker may deposit trust funds in a licensed neutral escrow depository in this state.
(4) A principal real estate broker or licensed real estate property manager who opens a clients’ trust account under subsection (2) or (3) of this section, or to whom ownership of a clients’ trust account is transferred, is liable for all deposits and disbursements made using the clients’ trust account until the principal real estate broker or licensed real estate property manager closes the account or transfers ownership of the account.
(5) A principal real estate broker or licensed real estate property manager may not commingle any other funds with the trust funds held in a clients’ trust account, except for:
(a) Earned interest on a clients’ trust account as provided in subsections (7) and (8) of this section; and
(b) Earned compensation as provided in subsection (9) of this section.
(6) If a licensed real estate property manager or principal real estate broker maintains a separate clients’ trust account in a branch office, a separate bookkeeping system must be maintained in the branch office and a copy of the records required under ORS 696.280 must be maintained in the main office of the licensed real estate property manager or principal real estate broker.
(7) Trust funds received by a licensed real estate property manager or principal real estate broker may be deposited by the licensed real estate property manager or principal real estate broker in a federally insured interest-bearing bank account that is designated a clients’ trust account under ORS 696.245, but only with the prior written approval of all parties who have an interest in the trust funds. The earnings of the interest-bearing account inure to the benefit of the licensed real estate property manager or principal real estate broker only if expressly approved in writing by all parties who have an interest in the trust funds before deposit of the trust funds.
(8) With prior written notice to all parties who have an interest in the trust funds, a principal real estate broker may place trust funds received by the principal real estate broker in a real estate sales, purchase or exchange transaction in a federally insured interest-bearing bank account that is designated a clients’ trust account under ORS 696.245, the earnings of which inure to the benefit of a public benefit corporation, as defined in ORS 65.001, for distribution to organizations and individuals for first-time homebuying assistance and for development of affordable housing. The principal real estate broker shall select a qualified public benefit corporation to receive the interest earnings.
(9) In connection with a real estate sales, purchase or exchange transaction, a principal real estate broker is not entitled to any part of any interest earnings on trust funds deposited under subsection (7) of this section or to any part of the earnest money or other money paid to the principal real estate broker as part or all of the principal real estate broker’s compensation until the transaction has been completed or terminated. The principal real estate broker and the seller shall negotiate and agree in writing to the disposition of forfeited earnest money at the time of execution by the seller of any listing agreement or earnest money agreement. An agreement about the disposition of forfeited earnest money must be initialed by the seller or immediately precede the seller’s signature.
(10) Trust funds in a clients’ trust account are not subject to execution or attachment on any claim against a licensed real estate property manager or principal real estate broker.
(11) The Real Estate Agency by rule shall establish an optional procedure by which a principal real estate broker may elect to disburse disputed funds held in relation to the sale, exchange or purchase of real estate from a clients’ trust account to the person who delivered the funds to the principal real estate broker. The procedure must allow disbursal not more than 20 days after a request is made for the disbursal. A disbursal pursuant to the procedure does not affect the claim of any other person to the funds.
(12) The agency may provide by rule for other records to be maintained and for the manner in which trust funds are deposited, held and disbursed. The rules adopted under this subsection may include requirements for interest or compensation held in a clients’ trust account pursuant to subsection (5) of this section to be disbursed from the clients’ trust account to a licensed real estate property manager or principal real estate broker.
(13) A real estate licensee who, for the purpose of transmitting a check, receives the check from a buyer or tenant that is payable to a property owner or seller is exempt from the deposit requirements of subsections (2) and (3) of this section. The agency may determine by rule the records that must be maintained for checks received as described in this subsection and the manner in which the checks must be transmitted. [1975 c.746 §18 (enacted in lieu of 696.240); 1977 c.649 §39; 1981 c.617 §11a; 1985 c.589 §4; 1991 c.5 §37; 2001 c.300 §21; 2003 c.224 §1; 2005 c.116 §18; 2005 c.393 §2a; 2007 c.224 §1; 2007 c.319 §9; 2007 c.337 §4; 2009 c.224 §5; 2009 c.324 §5; 2011 c.158 §4; 2013 c.145 §13; 2017 c.234 §15]
Structure 2021 Oregon Revised Statutes
Chapter 696 - Real Estate and Escrow Activities
Section 696.007 - Statement of legislative purpose.
Section 696.010 - Definitions.
Section 696.015 - Legislative finding; short title.
Section 696.022 - Licensing system for real estate brokers and property managers; rules.
Section 696.024 - Payments due and owing to Real Estate Agency.
Section 696.026 - Registration and renewal of business names; rules.
Section 696.125 - Limited license.
Section 696.130 - Effect of revocation of license; limited license.
Section 696.174 - License renewal; reactivation; continuing education courses; rules.
Section 696.182 - Continuing education; rules.
Section 696.184 - Duties of continuing education provider; rules.
Section 696.186 - Qualifications of continuing education instructors; rules.
Section 696.200 - Main office; branch offices; change of business location.
Section 696.232 - License status of employee of agency; reissuance upon termination of employment.
Section 696.243 - Substituting copy for original canceled check allowed; electronic fund transfers.
Section 696.245 - Clients’ trust accounts; notice to bank and agency; retention of copy.
Section 696.265 - Recognition of nonresident real estate licensee; rules.
Section 696.280 - Records of licensed real estate property managers and real estate brokers; rules.
Section 696.292 - Limitation on demand for compensation.
Section 696.294 - Opinion letter; rules.
Section 696.301 - Grounds for discipline.
Section 696.310 - Intracompany supervision and control.
Section 696.365 - City or county business license tax.
Section 696.385 - Power of agency; rulemaking procedures.
Section 696.392 - Power of commissioner to administer oaths, take depositions and issue subpoenas.
Section 696.395 - Power of commissioner.
Section 696.396 - Investigation of complaints and progressive discipline; rules.
Section 696.397 - Cease and desist order.
Section 696.398 - Delegation by commissioner to employees; requirements.
Section 696.405 - Real Estate Board; appointment; term; qualifications; compensation; expenses.
Section 696.415 - Officers; meetings; quorum.
Section 696.425 - Powers and duties of board; expenses.
Section 696.490 - Real Estate Account; disposition of receipts.
Section 696.495 - Revolving fund; amount; use; procedure for repayment.
Section 696.505 - Definitions for ORS 696.505 to 696.590.
Section 696.508 - Legislative finding; short title.
Section 696.511 - License requirement; licensing system; rules.
Section 696.520 - Application of ORS 696.505 to 696.590.
Section 696.525 - Bond for escrow agents.
Section 696.527 - Deposits in lieu of bond; payment of claims; waiver.
Section 696.530 - Expiration and renewal of license; fees; rules.
Section 696.532 - Limited license.
Section 696.534 - Records of escrow agents; rules.
Section 696.535 - Grounds for refusing, suspending or revoking license or reprimanding licensee.
Section 696.541 - Authority of commissioner over escrow agents; rules.
Section 696.545 - Investigation; injunction; jurisdiction.
Section 696.570 - Hearings procedure under ORS 696.505 to 696.590; subpoena.
Section 696.579 - Funds exempt from execution or attachment; designation of funds.
Section 696.585 - Civil penalties.
Section 696.590 - Penalty amounts.
Section 696.600 - Definitions for ORS 696.392, 696.600 to 696.785 and 696.995.
Section 696.603 - License requirement.
Section 696.612 - Grounds for disciplinary action.
Section 696.627 - On-site inspection allowed; deposit.
Section 696.710 - Necessity of alleging license in action to collect compensation.
Section 696.790 - Authority of commissioner to require fingerprints.
Section 696.795 - Authority of commissioner to conduct investigations and proceedings.
Section 696.800 - Definitions.
Section 696.805 - Real estate licensee as seller’s agent; obligations.
Section 696.810 - Real estate licensee as buyer’s agent; obligations.
Section 696.815 - Representation of both buyer and seller; obligations.
Section 696.820 - Agency disclosure pamphlet; rules.
Section 696.822 - Liability of principal for act, error or omission of agent or subagent.
Section 696.835 - Buyer and seller responsibilities.
Section 696.840 - Compensation and agency relationships.
Section 696.845 - Acknowledgment of existing agency relationships form; rules.
Section 696.855 - Common law application to statutory obligations and remedies.
Section 696.870 - Duties of real estate licensee under ORS 105.462 to 105.490, 696.301 and 696.870.
Section 696.880 - Licensee not required to disclose proximity of registered sex offender.
Section 696.890 - Duties of real estate property managers.
Section 696.995 - Civil penalties for violation of ORS 696.603, 696.606 or 696.612.