15VAC5-80 Regulations Under the Virginia Consumer Real Estate Settlement Protection Act

REGULATIONS

Vol. 25 Iss. 25 - August 17, 2009

TITLE 15. JUDICIAL

VIRGINIA STATE BAR

Chapter 80

Final Regulation

REGISTRAR'S NOTICE: The Virginia State Bar is exempt from the Administrative Process Act in accordance with § 2.2-4002 A 2 of the Code of Virginia, which exempts courts, any agency of the Supreme Court, and any agency that by the Constitution is expressly granted any of the powers of a court of record.

Title of Regulation: 15VAC5-80. Regulations Under the Virginia Consumer Real Estate Settlement Protection Act (amending 15VAC5-80-20, 15VAC5-80-30, 15VAC5-80-40).

Statutory Authority: § 6.1-2.25 of the Code of Virginia.

Effective Date: July 31, 2009.

Agency Contact: Mary Yancey Spencer, Deputy Executive Director, Virginia State Bar, 707 East Main Street, Richmond, VA 23219, telephone [phone] or email [e-mail].

Summary:

The amendments delete nonattorney settlement agents from those required to register with the Virginia State Bar. This conforms the regulations to Chapter 256 of the 2009 Acts of Assembly, which shifted the responsibility to register nonattorney settlement agents to the appropriate licensing agencies.

15VAC5-80-20. Definitions.

The following words and terms when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise.

"Attorney" means a person licensed as an attorney under Chapter 39 (§ 54.1-3900 et seq.) of Title 54.1 of the Code of Virginia and who is an active member of the Virginia State Bar in good standing under the Rules of the Virginia Supreme Court.

"Bar" means the Virginia State Bar.

"Board" means the Virginia Real Estate Board.

"CRESPA" means the Virginia Consumer Real Estate Settlement Protection Act (§ 6.1-2.19 et seq. of the Code of Virginia). Unless otherwise defined herein, all terms in these regulations shall have the meanings set forth in CRESPA.

"Disciplinary board" means the Virginia State Bar Disciplinary Board.

"Financial institution" has the meaning set forth in § 6.1-2.1 of the Code of Virginia.

"First dollar coverage" means an insurance policy which obligates the company issuing the policy to pay covered claims in their entirety, up to the policy limits, regardless of the presence of a deductible amount to which the company may be entitled as a reimbursement from the insured.

"SCC" means the Virginia State Corporation Commission.

"These regulations" means 15VAC5-80-10 et seq., Regulations under the Virginia Consumer Real Estate Settlement Protection Act.

15VAC5-80-30. Registration; reregistration; required fee.

Every licensed attorney, title insurance company, title insurance agent or real estate broker, as well as every financial institution authorized to do business in Virginia under any of the provisions of Title 6.1 of the Code of Virginia, or under federal law, and every subsidiary or affiliate of any such financial institution, now providing or offering, or intending to provide or offer, escrow, closing or settlement services as a settlement agent with respect to real estate transactions in Virginia shall register with the Bar on or before September 29, 1997, using the registration form available from the Bar for that purpose. Settlement agents beginning to provide or offer such services after July 1, 1997, shall register with the Bar prior to doing so. The registration requirement in this paragraph shall not apply to attorney settlement agents unless they provide or offer to provide escrow, settlement, and closing services for real estate subject to CRESPA, i.e., real estate containing not more than four residential dwelling units. Thus, for example, attorneys who handle only commercial real estate transactions are not subject to these regulations.

Every settlement agent shall thereafter reregister after notice on a schedule established by the Bar, providing updated registration information. Every settlement agent shall have a continuing duty to advise the Bar of any change in name, address, or other pertinent registration data that occurs between registrations.

The fee for each registration and reregistration shall be $35 for an individual attorney settlement agent and $100 for a settlement agent which is a corporation or other legal entity authorized to register in that capacity. The Bar reserves the right to adjust the fee as necessary within the statutory limit of $100. The prescribed fee shall accompany each registration or reregistration in the form of a check made payable to the Treasurer of Virginia.

Registration is subject to revocation or suspension if the Bar or other appropriate licensing authority finds the settlement agent out of compliance with CRESPA or regulations issued thereunder.

15VAC5-80-40. Unauthorized practice of law guidelines; investigation of complaints.

The Bar will issue guidelines under CRESPA and in consultation with the SCC and the board to assist settlement agents in avoiding and preventing the unauthorized practice of law in connection with the furnishing of escrow, closing, or settlement services. In conformity with CRESPA, the rules of the Virginia Supreme Court and the Bar's UPL opinions, these guidelines will delineate activities which can and cannot be carried out by registered nonattorney settlement agents in conducting settlements. The guidelines will be revised from time to time as necessary.

A copy of the The guidelines will be available on the Bar’s website and provided by the Bar appropriate licensing authority to each registered settlement agent at the time of initial registration and at each reregistration. The guidelines will also be published by the Bar in the Virginia Lawyer Register and furnished to the SCC, the board, and all other state and federal agencies that regulate financial institutions, as well as to members of the general public upon request. The guidelines may be photocopied as necessary.

The Bar will continue to receive and investigate unauthorized practice of law complaints in the real estate settlement area, as well as in other fields, under its unauthorized practice of law rules and procedures.

If the Bar receives complaints against nonattorney settlement agents that do not allege the unauthorized practice of law, it will refer the complaints to the appropriate licensing authority that has jurisdiction over the subject of the complaint. If the complaint involves an attorney settlement agent's noncompliance with 15VAC5-80-30, the Bar will conduct an informal investigation. If the Bar believes a violation has occurred, it will notify the attorney settlement agent in writing. If the apparent violation is not rectified within 30 days, the Bar will refer the matter to the appropriate licensing authority for further enforcement action investigate the alleged violations pursuant to 15VAC5-80-50 D.

NOTICE: The forms used in administering the above regulation are not being published; however, the name of each form is listed below. The forms are available for public inspection by contacting the agency contact for this regulation, or at the office of the Registrar of Regulations, General Assembly Building, 2nd Floor, Richmond, Virginia.

FORMS (15VAC5-80)

Settlement Agent Official Registration Form for a Corporation or Other Legal Entity (eff. 4/97).

Settlement Agent Official Registration Form for an Individual Attorney, Broker or Title Agent (eff. 1/98) (rev. 7/09).

Settlement Agent Official Re-Registration Reregistration Form for an Individual Attorney, Broker or Title Agent (eff. 2/98) (rev. 7/09).

Virginia Attorney Real Estate Settlement Agent Financial Responsibility Certification (eff. 2/98) (rev. 5/08).

Bond for Attorney Settlement Agents (eff. 5/97) Agent - Principal as Individual (rev. 7/09).

Bond for Attorney Settlement Agent - Principal as Law Firm (rev. 7/09).

Settlement Agent Official Renewal Form for Corporation or Other Entity.

VA.R. Doc. No. R09-1635; Filed July 31, 2009, 4:23 p.m.