N.Y. Real Property Law § 442-h: Rules of the secretary of state

§ 442-h. Rules of the secretary of state. 1. The secretary of state,

and not the state real estate board established under section four

hundred forty-two-i of this article, shall adopt such rules and

regulations as the secretary of state may determine are necessary for

the administration and enforcement of this section.

2. (a) If, after a public hearing and a reasonable investigation, the

secretary of state determines that the owners of residential real

property within a defined geographic area are subject to intense and

repeated solicitations by real estate brokers and salespersons or others

to place their property for sale with such real estate brokers or

salespersons, or otherwise to sell their property, and that such

solicitations have caused owners to reasonably believe that property

values may decrease because persons of different race, ethnic, social,

or religious backgrounds are moving or are about to move into the

neighborhood or geographic area, the secretary of state may adopt a

rule, to be known as a nonsolicitation order, directing all real estate

brokers, salespersons and other persons regularly engaged in the trade

or business of buying and selling real estate to refrain from soliciting

residential real estate listings or otherwise soliciting the sale of

residential real estate within the subject area. Each area subject to

such an order shall be bounded or otherwise specifically defined in the

order. The nonsolicitation order shall be subject to such terms and

conditions as the secretary of state may determine are, on balance, in

the best interest of the public, including but not limited to the

affected owners and licensees. A nonsolicitation order may prohibit any

or all types of solicitation directed towards particular home-owners,

including but not limited to letters, postcards, telephone calls,

door-to-door calls, and handbills. Every nonsolicitation order shall

contain a provision setting forth the day, month and year that the order

shall become effective, as well as the day, month and year that the

order shall expire. A nonsolicitation order shall not be effective for

more than five years. However, a nonsolicitation order and the

boundaries of the area where it applies may be re-adopted or amended

from time to time in accordance with the procedures set forth herein.

(b) No real estate broker shall establish a new principal office or

branch office within any geographic area which is the subject of a

nonsolicitation order without prior approval from the secretary of

state. The secretary of state may deny any application for the

establishment or relocation of a principal office or branch office if

approval of the application would cause the total number of principal

and branch offices within the subject area to exceed the total number of

principal and branch offices that were licensed within the area on the

date the nonsolicitation order became effective.

3. (a) If the secretary of state determines that some owners of

residential real property within a defined geographic area are subject

to intense and repeated solicitation by real estate brokers and

salespersons to place their property for sale with such real estate

brokers or salespersons, or are subject to intense and repeated

solicitation by other persons regularly engaged in the trade or business

of buying and selling real estate to sell their real estate, the

secretary of state may adopt a rule establishing a cease and desist

zone, which zone shall be bounded or otherwise specifically defined in

the rule. After the secretary of state has established a cease and

desist zone, the owners of residential real property located within the

zone may file an owner's statement with the secretary of state

expressing their wish not to be solicited by real estate brokers,

salespersons or other persons regularly engaged in the trade or business

of buying and selling real estate. The form and content of the statement

shall be prescribed by the secretary of state. After a cease and desist

zone has been established by the secretary of state, the secretary of

state shall provide public notice on its website of such zone, shall

publish notice of such zone at least once annually in a newspaper of

general circulation in the area affected by the cease and desist zone,

and shall provide such further public notice of such cease and desist

zone as the secretary of state deems necessary to maximize awareness to

owners of residential real property located within the cease and desist

zone that they may file a statement pursuant to this paragraph. After a

cease and desist zone has been established by the secretary of state, no

real estate broker, salesperson or other person regularly engaged in the

trade or business of buying and selling real estate shall solicit a

listing from any owner who has filed a statement with the secretary of

state if such owner's name appears on the current cease and desist list

prepared by the secretary of state. The prohibition on solicitation

shall apply to direct forms of solicitation such as the use of the

telephone, the mail, personal contact and other forms of direct

solicitation as may be specified by the secretary of state.

(b) The secretary of state shall compile a cease and desist list for

each zone established pursuant to paragraph (a) of this subdivision. In

addition to such other information as the secretary of state may deem

appropriate, each cease and desist list shall contain the name of each

owner who has filed an owner's statement with the secretary, as well as

the address of the property within the zone to which the owner's

statement applies. The secretary of state shall send to each owner who

has filed an owner's statement a written acknowledgement of the

secretary of state's receipt thereof and a pamphlet explaining to the

owner his or her rights in connection therewith and the procedures and

time limits applicable to the filing of complaints for violations. The

secretary of state shall allow an owner who files, or on behalf of whom

is filed, a complaint or other report of a violation of a cease and

desist rule ninety days in which to perfect a complaint by submitting

such other or further information or documents as the secretary of state

may require. The secretary of state shall print a list for each zone.

Each list shall be revised and reprinted at least annually on or before

December thirty-first and shall be made available to the public and to

real estate brokers at a reasonable price to be set by the secretary of

state and approved by the director of the division of the budget.

Additions or deletions shall be made to each list only at the time the

list is reprinted, and the secretary of state shall not issue amendments

or addenda to any printed list.

(c) No rule establishing a cease and desist zone shall be effective

for longer than five years. However, the secretary of state may re-adopt

the rule to continue the cease and desist zone for additional periods

not to exceed five years each. Whenever a rule establishing a cease and

desist zone shall have expired or shall have been repealed, all owner's

statements filed with the secretary of state pursuant to that rule shall

also expire. However, an owner may file a new statement with the

secretary of state if a new rule is adopted establishing a cease and

desist zone containing the owner's property. Once the boundaries of a

cease and desist zone have been established by rule of the secretary of

state, the boundaries may not be changed except by repeal of the

existing rule and adoption of a new rule establishing the new

boundaries.

4. (a) Each real estate broker shall institute standardized operating

procedures for the prerequisites prospective homebuyers must meet prior

to receiving any services. Such standardized operating procedures shall

include but not be limited to the following:

(i) whether prospective clients shall show identification;

(ii) whether an exclusive broker agreement is required;

(iii) whether pre-approval for a mortgage loan is required; and

(iv) any other such standardized operating procedures as the secretary

of state shall determine by regulation and upon notice and public

hearing.

(b) Real estate brokers shall date stamp, notarize and post such

standardized operating procedures on any publicly available website and

mobile device application they maintain, shall make a copy of such

procedures available to the public upon request at their office

locations, and shall maintain a file of such standardized operating

procedures while the broker's license is active. Any website or mobile

device application maintained by a team or a real estate salesperson

should also have the brokers' policies posted or have a direct link from

such website or mobile device application to the brokers' website or

mobile device application. If any alterations are made to the

standardized operating procedures subsequent to such posting, real

estate brokers shall date stamp, notarize and post such new standard

operating procedures on any publicly available website or mobile device

application they maintain within thirty days, and archive such

alterations. Any broker or salesperson operating under a brokerage

license that fails to adhere to such operating procedures shall be

subject to the penalties imposed by section four hundred forty-one-c of

this article.

(c) Any time a real estate broker is required to renew their license

they must affirm to the department of state that they are in compliance

with the requirements of this subdivision related to standardized

operating procedures.