Berrey v. Real Estate Agency

Having a partial ownership interest in the property one is managing does not negate the fact that the management is being done “for another” so as to qualify as professional real estate activity. ORS 696.010(14). The managing member exception only applies to individuals who are a managing member of an LLC managing the property. ORS 696.030(27).

Petitioner appealed a determination by an administrative law judge finding that he engaged in professional real estate activity without an up-to-date license. Petitioner assigned error to the commissioner’s finding that he was subject to licensure requirements under ORS 696. On appeal, Petitioner argued that, because he had a partial ownership interest in the properties (either as an LLC member or a trustee member), he was not conducting professional real estate activity such as to subject him to the licensure requirement under ORS 696.010(14). Alternatively, Petitioner argued that, because he had a partial ownership interest in the properties, he was exempted from the licensure requirement under the manager exemption. ORS 696.030(27). Having a partial ownership interest in the property one is managing does not negate the fact that the management is being done “for another” so as to qualify as professional real estate activity. ORS 696.010(14). The managing member exception only applies to individuals who are a managing member of an LLC managing the property. ORS 696.030(27). The Court found that, despite Petitioner’s partial ownership interests, he was engaged in professional real estate activity subject to a licensure requirement, for which he did not meet the manager member exemption because he was not a managing member of an LLC directly involved in managing the properties. Therefore, the Court held Petitioner acted in violation of the licensure requirement. Affirmed.