During the November TREC Meeting, the Commission proposed two rule amendments and one new rule. The Texas Real Estate Inspector Committee recommended the proposal of amendments to 535.223, Standard Inspection Report Form. The Unauthorized Practice of Law Working group recommended a new rule, 537.1, Definitions, and amendments to Section 537.11, use of Standard Contract Forms.
Written public comments on proposed rules are now being accepted through December 25, 2022. These proposed rules will be up for adoption at the TREC Meeting on February 13, 2023.
- Use the online public comment tool to submit comments.
- Send comments via email.
- Mail comments to General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188.
Proposed Amendments to Section 535.223, Standard Inspection Report Form
The Commission proposed amendments to Section 535.223 to clarify that when multiple boxes are checked for a particular item on the Property Inspection Report Form (REI 7-6), the inspector must also explain the reason for checking multiple boxes. The proposed amendments also remove single-system inspections from the list of exemptions—meaning the requirements in Section 535.223 would apply to those inspections.
Choose 22 TAC 535.223 – Standard Inspection Report form on the dropdown menu to provide comment via the TREC website.
Proposed New Rule to Define Informational Items
Based on recommendations from the Unauthorized Practice of Law Working Group, the Commission proposed a new rule, Section 537.1, Definitions. Among other definitions, Section 537.1 includes a definition for the new term "informational items," which is intended to better describe the type of information that a license holder can add to a contract form. This definition mirrors the newly adopted language in Paragraph 11 of the Commission's contract forms.
Choose 22 TAC 537.1 – Definitions on the dropdown menu to provide comment via the TREC website.
Proposed Amendments to Clarify the Unauthorized Practice of Law
Also recommended by the Unauthorized Practice of Law Working Group, proposed amendments to Section 537.11, Use of Standard Contract Forms, reorganize and consolidate the rule for clarity and simplify the language regarding when a license holder is required to use a Commission-approved contract form and what is considered the unauthorized practice of law.
Specifically, the proposed changes in subsection (a) align the rule language more closely with the applicable statutory language and simplify the list of exceptions related to contract form use by license holders.
The exception found in subsection (a)(4) is amended to eliminate the ability of license holders to use contract forms prepared by an attorney for a brokerage when no Commission-approved contract form for mandatory use exists.
Subsections (b) through (d) provide further guidance to license holders and members of the public on what the Commission considers to be the unauthorized practice of law.
Subsection (d)(2) provides that it is not the practice of law to add language to or strike language from a contract form, if specifically instructed in writing by a principal, as long as any change is made conspicuous, including underlining additions, striking through deletions, or employing some other method which clearly indicates the change being made.
Finally, the proposed changes to subsection (h) update the language regarding reproduction of Commission-approved contract forms to better account for changes in technology.
Choose 22 TAC 537.11 – Use of Standard Contract Forms on the dropdown menu to provide comment via the TREC website.
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