COMMERCIAL REAL ESTATE BROKER'S LIEN S.B. 610 (S-1): FLOOR SUMMARY
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Senate Bill 610 (Substitute S-1 as reported)
Sponsor: Senator Jason E. Allen
Committee: Economic Development and Regulatory Reform

CONTENT
The bill would create the "Commercial Real Estate Broker's Lien Act" to do all of the following:

-- Specify circumstances under which a commercial real estate broker's lien would attach to commercial real estate (described below).
-- Require a claim of lien to be recorded before conveyance unless the broker's commission was due in installments and at least one was due after conveyance.
-- Provide for the recording and attachment of a lien in the case of a lease agreement, a broker's acting as a buyer's agent, or a commission owed on a purchase option.
-- Specify information that a claim of lien would have to include.
-- Provide that a prior-recorded lien or mortgage would have priority over a commercial real estate broker's lien.
-- Require the establishment of an escrow account if a lien recorded under the proposed Act would prevent a closing transaction, and prohibit a buyer or seller from refusing to close a transaction because of that requirement.
-- Authorize a person claiming a commercial real estate broker's lien to bring an action to enforce it in circuit court.
-- Allow an owner of commercial real estate to serve on a lien holder a demand to enforce the lien or answer a claim; and provide that the lien would be extinguished if the lien holder did not respond within 30 days.
-- Specify that a lien under the Act would be available only to a licensed real estate broker.
A commercial real estate broker's lien would attach to commercial real estate in favor of a real estate broker if all of the following circumstances existed:

-- The real estate broker had a written commission agreement.
-- The broker was entitled to a commission under that agreement.
-- The broker recorded a claim of lien before the actual conveyance of the commercial real estate.


The proposed Act would apply to a written commission agreement signed after the bill's effective date.

Legislative Analyst: Patrick Affholter

FISCAL IMPACT
The bill would have no fiscal impact on State or local government.


Date Completed: 11-12-09 Fiscal Analyst: Bill Bowerman

Analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent. sb610/0910