The Illinois Second District Appellate Court recently affirmed that an attorney who acted as both realtor and attorney in the same real estate transaction violated the Real Estate License Act of 2000 (Act) (225 ILCS 454/20-20(34).
On Jan. 9, 2014, the Illinois Department of Financial and Professional Regulation (“IDFPR”) filed a complaint against Peter Curielli, a real estate managing broker and attorney, for violating the Real Estate License Act of 2000 during the February 2013 sale of a property in Chicago. Curielli was fined $9,500 and his real estate license was suspended indefinitely.
A month later, Curielli moved to dismiss the complaint, saying it was too broad and didn’t clearly state a statutory violation. After a series of motions and hearings, an administrative law judge determined Curielli did act as a broker and attorney in the transaction, then recommended an indefinite broker license suspension and a $9,500 fine. On Nov. 5, 2015, the IDFPR’s real estate wing adopted that suggestion, further recommending the suspension last for at least a year.
Curielli moved for a rehearing the next month, which the IDFPR denied. In March 2016, Curielli sought administrative review. On Sept. 14, 2017, an administrative judge reversed the IDFPR’s ruling and rescinded the sanctions. The IDFPR appealed.
On November 13, 2018, the Illinois Second District Appellate Court upheld the IDFPR’s ability to sanction attorneys who provide legal services and act as real estate brokers in the same transaction. It noted that Curielli “provided services which required his legal knowledge,” including:
- interpreting and enforcing the contract terms on behalf of his clients;
- requiring that the title company change the closing statement so it accurately reflected contract terms;
- assessing closing costs to the proper parties; and
- coring proration amounts;
- contacting the Seller’s attorney to ensure his clients received proper credits, a timely survey, and were compensated for missing items they were to receive, all per the terms of the contract
It also rejected the notion that the defendant’s father, also an attorney, was the person who was providing legal services, noting that the Seller’s attorney testified he believed Peter Curielli was doing the legal work for the buyers and appeared to be making decisions.
The appellate court also disagreed with the notion that someone might be allowed to act as “an” attorney in such cases, but not “the” attorney. The court held that such a reading “leads to absurd results that are contrary to protecting the clients’ interests.”
The appellate court did, however, overturn Curielli’s suspension, holding that that he had no prior sanctions and “the nature of his actions — i.e., two emails in only one client transaction, where no fraud was alleged — were not so egregious as to warrant an indefinite suspension.”
The moral of the story, it appears, is to stay in your own swim lane. More specifically, attorneys who are also real estate brokers must play only one role in any given real estate transaction. Even a first-time offense can lead to discipline.
Byrne Law will continue to provide news and updates on matters affecting the Illinois real estate community. If you have further questions, please contact Sean Byrne.