Request By:
Miss Mimi Lowry
R.E. Fairhurst Realty
1240 Jefferson Street
P.O. Box 7404
Paducah, Kentucky 42001
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Nancy M. Collins, Assistant Attorney General
This is in response to your letter in which you state that you were recently appointed executrix of a friend's estate and the terms of the will direct you to sell her real property. The heirs desire that the property be sold privately and not listed with a real estate firm. Inasmuch as you are a licensed broker, however, the Real Estate Commission directed you to advertise the estate property under the name of your designated broker, pursuant to KRS 324.117(5) and 201 KAR 11:060.
KRS 324.020 requires anyone acting as a real estate broker or salesman to be licensed by the Commission. Acting as a broker or salesman, as defined in KRS 324.010, is limited to persons acting for a commission or valuable consideration who sell, buy, etc. real estate for others. Specifically exempted from the licensing requirements are the owners of property and executors. KRS 324.030. Clearly, if you were not a licensed broker, you as executrix could advertise and sell the property without listing it with a broker.
The jurisdiction and power of the Commission is limited solely to that granted by the legislature. Auxier v. Commonwealth, Board of Embalmers and Funeral Directors, Ky.App., 553 S.W.2d 286 (1977). From the provisions of KRS 324.010 through 324.030, the jurisdiction of the Commission is limited to persons acting as a broker or salesman. When acting in your capacity as executrix, you are expressly excluded from the jurisdiction of the Commission by KRS 324.030(4), and are not acting in your capacity as a broker as defined in KRS 324.010(1)(c). For these reasons, the Commission cannot take disciplinary action against you if you do not advertise the estate property in the name of your designated broker.
As you noted in your letter, there is an additional problem with the directive of the Commission. 201 KAR 11:105, Section 1, precludes a broker from advertising property unless such property is listed in writing. If the Commission requires you to advertise the property in the broker's name, it essentially forces the heirs to list the property and to list it with that particular broker. This appears to be an unconstitutional restraint on the alienation of the property.
The United States Constitution, through the Fourteenth Amendment, guarantees that the rights to acquire, enjoy, own and dispose of property shall not be abridged by discriminatory state action. Lynch v. Household Finance Corporation, 405 U.S. 538, 92 S. Ct. 1113, 31 L. Ed. 2d 424 (1972), rehearing denied 406 U.S. 911, 92 S. Ct. 1611, 31 L. Ed. 2d 822. The Constitution of Kentucky, § 1 and § 2, recognize the inherent and inalienable right to acquire and dispose of property. This right is subject only to the valid exercise of the police power of the state for the purpose of the protection of the public. Bruner v. City of Danville, Ky., 394 S.W.2d 939 (1965). The police power cannot be used to promote private interests. Parker v. Rash, 314 Ky. 609, 236 S.W.2d 687 (1951).
In summary, when acting in your capacity as executrix, you do not have to advertise estate property in the name of your designated broker. This assumes, of course, that you do not accept a fee or commission for the sale of the property other than the fee provided for in KRS 395.150.