The Lapsed License and the Unlicensed Assistant
Dana is a salesperson affiliated with a Reno brokerage. She missed her renewal and her license lapsed on March 31; she did not notice until April 14. Meanwhile: (1) she took a new listing on April 5 and held it open on April 6; (2) an offer on a different property she had listed in February was accepted on April 10, with closing set for May 8; (3) her unlicensed assistant, Theo, has been hosting weekend open houses, telling visitors the seller 'would probably take $15,000 under list,' and emailing a flyer he designed that shows only the team name. The broker has reviewed none of the advertising. Dana asks whether she can simply finish the May 8 closing and collect her share of the commission.
1. Which of Theo's three activities require a Nevada real estate license, and what is the supervisory exposure for Dana and the broker?
Read the worked answer
Sort the activities by whether they involve negotiation or the exercise of judgment about price and terms.
- Quoting the seller's likely acceptance price is negotiating a term of the transaction. That is licensed activity. Theo cannot do it, even informally, even if he is repeating something he overheard.
- Hosting an open house unsupervised is not automatically unlicensed, but in practice the person at the door is asked about price, terms, financing, and condition. An unlicensed assistant may hand out pre-approved materials, give factual answers from the listing data, and schedule showings; the moment the conversation turns to what the seller will take, the assistant is negotiating.
- Designing and emailing the flyer is clerical in itself, but the omits-the-brokerage-name problem is an advertising violation attributable to the brokerage.
The salesperson and the broker both carry supervisory responsibility for assistants. Practical fix: pull Theo from unsupervised open houses, script his permissible answers, and require broker pre-approval of all advertising before it goes out.
2. Can Dana be paid for the May 8 closing? What should the broker do about the April 5 listing and the April 6 open house?
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Separate the transactions and the dates carefully.
May 8 closing. The commission is earned by and paid to the brokerage, and the brokerage may only compensate a person who was licensed when the licensed acts were performed. Dana was unlicensed when she took the new April 5 listing and held it open. On the February listing, the procuring and negotiating largely occurred while she was licensed, and the April 10 acceptance arguably falls in the gap. The defensible course is: Dana reinstates immediately and performs nothing further until the license is active; a currently licensed affiliate is assigned to shepherd both files to closing with written disclosure to the clients; and the broker withholds any split attributable to acts performed during the lapse pending advice from the Division and counsel. Paying her for the unlicensed period is the outcome most likely to produce discipline.
April 5 listing. It was procured by an unlicensed person. The broker should have a licensed affiliate re-paper the listing with the seller, disclose the lapse in writing, and document the cure. Do not backdate anything.
3. The flyer shows only the team name. Is that acceptable, and who owns the problem?
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No. Nevada advertising rules require that advertising identify the brokerage as licensed; a team name is a marketing label, not a licensed entity, and it may be used only in a way that also identifies the brokerage. A flyer that names only the team leaves the public with no way to know which broker stands behind the representation.
The problem belongs to the broker, not to Theo or the team lead. The broker is responsible for advertising by the brokerage and its licensees and affiliates, and 'I never saw it' is not a defense when the broker has no review process at all. Corrective steps: add the brokerage name exactly as licensed, delete the price speculation, add broker review and a sign-off before any ad, open house handout, or social post is distributed, and document the new procedure in the office policy manual.