Kansas City Premier Apartments, Inc. v. Missouri Real Estate Commission

344 S.W.3d 160, 2011 Mo. LEXIS 203, 2011 WL 2848191
CourtSupreme Court of Missouri
DecidedJuly 19, 2011
DocketSC 91125
StatusPublished
Cited by15 cases

This text of 344 S.W.3d 160 (Kansas City Premier Apartments, Inc. v. Missouri Real Estate Commission) is published on Counsel Stack Legal Research, covering Supreme Court of Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kansas City Premier Apartments, Inc. v. Missouri Real Estate Commission, 344 S.W.3d 160, 2011 Mo. LEXIS 203, 2011 WL 2848191 (Mo. 2011).

Opinions

ZEL M. FISCHER, Judge.

Kansas City Premier Apartments, Inc. (“KCPA”) appeals an injunction entered by the trial court finding it in violation of chapter 339 and prohibiting it from continuing any activities requiring real estate licensure. KCPA claims that the trial court misapplied § 339.010.1, RSMo Supp. 2010.1 It also claims that the trial court erred in not declaring § 339.010.1 and § 339.010.7 unconstitutional. This Court has exclusive jurisdiction over this appeal under article V, section 3, of the Missouri Constitution, as the appeal involves the validity of a state statute. Judgment affirmed.

Facts

In 2001, Tiffany Lewis and Ryan Gran founded KCPA, a business devoted to assisting owners of rental property in locating prospective renters (“prospects”). Neither Lewis nor Gran has a Missouri real estate brokerage license. KCPA’s business model is built on entering into non-exclusive performance-based agreements with property owners. The property owners agree to pay a fee to KCPA for each new tenant who submits to the property owner a card verifying that he or she was referred to the property by KCPA. KCPA offers a $100 gift card to each prospect who gives a property owner a card that results in a payment to KCPA.

KCPA operates through its website, www.kcpremierapts.com. The website offers a searchable database of rental listings provided by property owners. It also offers prospects the option of direct, interactive contact with rental advisors. These advisors are independent contractors who will respond to any questions asked by prospects, recommend which properties to rent, and contact property owners to arrange appointments. The record shows that 80% of prospects take advantage of KCPA’s rental advisors.

In 2004, the Missouri Real Estate Commission received a complaint about KCPA and began an investigation to determine if KCPA was unlawfully engaged in real estate activities. In 2006, the Commission sent Lewis a letter stating it had determined that KCPA was “conducting real estate activity without a Missouri real estate license ... in violation of Missouri law and must cease immediately.”

In January 2007, KCPA responded, stating that it believed it was in compliance with the law. In March, the Commission sent another letter to KCPA insisting that it was “illegally operating as a real estate broker ... without the required Missouri real estate broker license.” The letter threatened immediate legal action. In April, KCPA preempted the Commission by filing a lawsuit requesting a declaratory judgment that § 339.010.1 does not encompass its business activities, that [165]*165§ 3B9.010.7 exempts KCPA from the licen-sure requirements of chapter 339, and that the Commission’s interpretation of chapter 339 violates KCPA’s rights under the United States and Missouri constitutions.

In 2009, after two years of litigation, the Commission filed its own petition for a preliminary injunction, seeking to bar KCPA from performing real estate activities. In 2010, the two cases were consolidated and tried. The trial court issued an injunction prohibiting KCPA from “[e]on-tracting with property owners to receive compensation in return for referring prospective tenants” and from performing “any act requiring real estate licensure.” It also prohibited KCPA from dispensing rebate cards to tenants and denied KCPA’s request for declaratory judgment.

Application of § 339.010

KCPA challenges the trial court’s judgment claiming that it erroneously applied § 339.010. KCPA claims that while it meets the definition of a “real estate broker” under § 339.010.1, it qualifies for an exemption under § 339.010.7.

Standard of Review

This Court must sustain the trial court’s judgment “unless there is no substantial evidence to support it, unless it is against the weight of the evidence, unless it erroneously declares the law, or unless it erroneously applies the law.” Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976).

Analysis

Section 339.010.1 defines a “real estate broker” as a person or corporation who for valuable consideration does or attempts to do any of the following:

(3) Negotiates or offers or agrees to negotiate the sale, exchange, purchase, rental or leasing real estate;
(4) Lists or offers or agrees to list real estate for sale, lease, rental or exchange;
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(7) Assists or directs in the procuring of prospects, calculated to result in the sale, exchange, leasing or rental of real estate;
(8) Assists or directs in the negotiation of any transaction calculated or intended to result in the sale, exchange, leasing or rental of real estate;
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(10) Performs any of the foregoing acts on behalf of the owner of real estate, or interest therein, or improvements affixed thereon, for compensation.

§ 339.010.1. Section 339.020 makes it unlawful for any person or corporation to act as a real estate broker without a license, and a violation is a class B misdemeanor. Section 339.170.

KCPA argues the trial court’s judgment erroneously applies these provisions because KCPA is retained by landlords to list and otherwise assist them in marketing their rental properties and, therefore, it qualifies for an exemption from the chapter 339 licensure requirements under § 339.010.7(5). Section 339.010.7(5) states that the provisions of chapter 339 do not apply to:

[a]ny person employed or retained to manage real property by, for, or on behalf of the agent or the owner of any real estate shall be exempt from holding a license, if the person is limited to one or more of the following activities:
(a) Delivery of a lease application, a lease, or any amendment thereof, to any person;
(b) Receiving a lease application, lease, or amendment thereof, a security deposit, rental payment, or any related payment, for delivery to, and made payable to, a broker or owner;
[166]*166(c) Showing a rental unit to any person, as long as the employee is acting under the direct instructions of the broker or owner, including the execution of leases or rental agreements;
(d) Conveying information prepared by a broker or owner about a rental unit, a lease, an application for lease, or the status of a security deposit, or the payment of rent, by any person;
(e) Assisting in the performance of brokers’ or owners’ functions, administrative, clerical or maintenance tasks....

KCPA argues that because the statute does not define what it means for a person to be “employed or retained to manage real property,” the term “retain” must be given its ordinary meaning as found in the dictionary. In re Coffman, 225 S.W.3d 439, 444 (Mo. banc 2007).

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Bluebook (online)
344 S.W.3d 160, 2011 Mo. LEXIS 203, 2011 WL 2848191, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kansas-city-premier-apartments-inc-v-missouri-real-estate-commission-mo-2011.