Florida Real Estate Broker ExaminationReal Estate Brokerage ManagementEasy
A licensed real estate broker in Florida is operating a brokerage as a sole proprietorship. If the broker passes away, what is the immediate consequence for the brokerage's operation?
- AThe sales associates can continue to operate the brokerage for up to 90 days under the supervision of a temporary broker.
- BThe Department of Business and Professional Regulation (DBPR) will appoint a temporary broker to oversee operations for up to six months.
- CThe brokerage immediately ceases all real estate activities until a new broker is appointed or the business is properly closed.
- DThe deceased broker's estate can designate an unlicensed person to manage the brokerage for a period not exceeding one year.
Show answer & explanationAnswer & explanation
Correct answer: C. The brokerage immediately ceases all real estate activities until a new broker is appointed or the business is properly closed.
In a sole proprietorship, the license of the broker is tied directly to the business operation. Upon the broker's death, there is no longer a licensed individual to oversee the brokerage, requiring an immediate cessation of activities.
Why the other options are wrong
- A. This option is incorrect because a temporary broker can only be appointed for a partnership or corporation, not a sole proprietorship.
- B. This option is incorrect as the DBPR does not appoint temporary brokers for sole proprietorships; this provision applies to partnerships or corporations.
- D. This option is incorrect; an unlicensed person cannot manage real estate activities, and the estate cannot designate an unlicensed person to operate the brokerage.
Sole Proprietorship Broker Death
Upon the death of a sole proprietor real estate broker, the brokerage immediately ceases all real estate activities.
- Broker's license is personal to the individual.
- No continuity of operation without a licensed broker.
- Different rules apply to partnerships and corporations.
Memory trick: When the sole 'prop' drops, the show stops.