§ 93A-17. Grounds for payment; notice and application to Commission.
§ 93A‑17. Grounds forpayment; notice and application to Commission.
(a) An aggrieved personwho has suffered a direct monetary loss by reason of the conversion of trustfunds by a real estate salesperson licensed before April 1, 2006, or by anylicensed real estate broker shall be eligible to recover, subject to thelimitations of this Article, the amount of trust funds converted and which isotherwise unrecoverable provided that:
(1) The act or acts ofconversion which form the basis of the claim for recovery occurred on or afterSeptember 1, 1979;
(2) The aggrieved personhas sued the real estate broker or salesperson in a court of competentjurisdiction and has filed with the Commission written notice of such lawsuitwithin 60 days after its commencement unless the claim against the Real EstateRecovery Fund is for an amount less than three thousand dollars ($3,000),excluding attorneys fees, in which case the notice may be filed within 60 daysafter the termination of all judicial proceedings including appeals;
(3) The aggrieved personhas obtained final judgment in a court of competent jurisdiction against thereal estate broker or salesperson on grounds of conversion of trust fundsarising out of a transaction which occurred when such broker or salesperson waslicensed and acting in a capacity for which a license is required; and
(4) Execution of thejudgment has been attempted and has been returned unsatisfied in whole or inpart.
Upon the termination of alljudicial proceedings including appeals, and for a period of one yearthereafter, a person eligible for recovery may file a verified application withthe Commission for payment out of the Real Estate Recovery Fund of the amountremaining unpaid upon the judgment which represents the actual and direct losssustained by reason of conversion of trust funds. A copy of the judgment andreturn of execution shall be attached to the application and filed with theCommission. The applicant shall serve upon the judgment debtor a copy of theapplication and shall file with the Commission an affidavit or certificate ofsuch service.
(b) For the purposes ofthis Article, the term "trust funds" shall include all earnest moneydeposits, down payments, sales proceeds, tenant security deposits, undisbursedrents and other such monies which belong to another or others and are held by areal estate broker or salesperson acting in that capacity. Trust funds shallalso include all time share purchase monies which are required to be held intrust by G.S. 93A‑45(c) during the time they are, in fact, so held. Trustfunds shall not include, however, any funds held by an independent escrow agentunder G.S. 93A‑42 or any funds which the court may find to be subject toan implied, constructive or resulting trust.
(c) For the purposes ofthis Article, the terms "licensee", "broker", and"salesperson" shall include only individual persons licensed underthis Chapter as brokers or individual persons who were licensed under thisChapter as salespersons prior to April 1, 2006. The terms "licensee","broker", and "salesperson" shall not include a time sharedeveloper, time share project, independent escrow agent, corporation or otherentity licensed under this Chapter. (1979, c. 614, s. 1; 1983, c. 81, ss. 2, 14; 1987, c.516, s. 6; 1999‑229, s. 8.; 2000‑140, s. 19(b); 2005‑395, s.14.)