Minnesota Real Estate Broker Exam — All Questions

A married Minnesota owner holds the homestead in the owner's name alone. A conveyance of that homestead is:

• a.Valid if the owner signs and the deed is promptly recorded
• b.Valid if the nonowner spouse is given ten days' written notice
• c.Valid if the nonowner spouse does not object before closing
• d.Invalid without the signatures of both spouses✓

Minn. Stat. 507.02 provides that if the owner is married, no conveyance of the homestead is valid without the signatures of both spouses, subject to narrow exceptions for a purchase money mortgage under section 507.03, a conveyance between spouses under section 500.19, subdivision 4, and a severance of a joint tenancy under section 500.19, subdivision 5. Recording does not cure an invalid conveyance, since recording gives notice of an instrument rather than validity to it. Notice to the spouse is not a substitute for the spouse's signature, and neither is the spouse's silence. A spouse's signature may be made by a duly appointed attorney-in-fact.

A Minnesota deed grants land to two people and says nothing about the form of co-ownership. Minnesota construes the grant to create:

• a.A life estate in each grantee with a reversion to the grantor
• b.A joint tenancy with a right of survivorship
• c.A tenancy by the entirety if the grantees are married
• d.A tenancy in common between the two grantees✓

Minn. Stat. 500.19, subd. 2 provides that all grants and devises of lands made to two or more persons are construed to create estates in common, and not in joint tenancy, unless expressly declared to be in joint tenancy; the rule does not apply to mortgages or to devises or grants made in trust or to executors. Joint tenancy is therefore the exception a deed must state, not the default. Minnesota does not recognize a tenancy by the entirety, so marriage does not change the construction. Nothing in a silent grant creates successive estates, and subdivision 3 separately abolishes the common law requirement of unity of time, title, interest, and possession for creating a joint tenancy.

Which event severs a Minnesota joint tenancy in real estate?

• a.Entry of a decree dissolving the joint tenants' marriage✓
• b.A joint tenant's unrecorded written declaration of severance
• c.A joint tenant's oral notice of severance to the other tenants
• d.A joint tenant's move out of the jointly owned dwelling

Minn. Stat. 500.19, subd. 5 makes a severance by one joint tenant legally effective only if the instrument of severance is recorded with the county recorder or registrar of titles, or is executed by all of the joint tenants, or the severance is ordered by a court, or a severance is effected by a joint tenant's bankruptcy; the subdivision then provides that a decree of dissolution of a marriage severs all joint tenancy interests between the parties except to the extent the decree declares they continue to hold as joint tenants. An unrecorded unilateral declaration meets none of the four routes, and an oral notice meets none either. Possession is not one of the tests, so moving out changes nothing about title.

Under Minnesota's Subdivided Land Sales Act, offering or selling an interest in subdivided lands in this state is unlawful unless:

• a.The subdivider has posted a performance bond with the county
• b.The subdivider maintains an office within the state of Minnesota
• c.The interest is registered with the commissioner or is exempt✓
• d.The purchaser waives inspection of the public offering statement

Minn. Stat. 83.23, subd. 1 makes it unlawful for any person to offer or sell an interest in subdivided lands in this state unless the interest is registered under that section or the subdivided land or the transaction is exempt under section 83.26. Registration is by notification for subdivisions of not more than 100 lots, units, parcels, or interests, or by qualification with a public offering statement. A county performance bond and an in-state office are not what chapter 83 conditions the offer on. A purchaser waiver runs against the statute's design, which is to put a public offering statement in the buyer's hands rather than to let it be waived away.

Minnesota's definition of "subdivided land" reaches real estate that is:

• a.Located in Minnesota only, and divided into six or more separate lots
• b.Located anywhere, if divided or proposed to be divided for sale or lease✓
• c.Located anywhere, if the parcels are unimproved and larger than ten acres
• d.Located in Minnesota only, and held by an out-of-state subdivider

Minn. Stat. 83.20, subd. 11 defines "subdivision" or "subdivided land" as any real estate, wherever located, improved or unimproved, which is divided or proposed to be divided for the purpose of sale or lease, including sales or leases of any timeshare interest, unit in a common interest community, or similar interest in real estate. The phrase "wherever located" is the point: a Minnesota licensee who offers out-of-state land to Minnesota buyers is within chapter 83. The other three options graft on a Minnesota-situs limit, a lot count, a subdivider residency test, or an improvement and acreage test, none of which appears in the definition.

The Minnesota Common Interest Ownership Act governs all common interest communities created in Minnesota on and after:

• a.January 1, 2000
• b.August 1, 1980
• c.June 1, 1994✓
• d.July 1, 2010

Minn. Stat. 515B.1-102, paragraph (a) provides that except as that section otherwise provides, chapter 515B, and not chapters 515 and 515A, applies to all common interest communities created within this state on and after June 1, 1994. Paragraph (b) then sets out how the Act reaches communities created earlier: it applies to condominiums created under chapter 515A as to events and circumstances occurring on and after that same date, and a listed set of its sections applies to condominiums created under chapter 515. The other dates match nothing in the Act, and choosing one would leave a licensee looking in chapter 515 or 515A for rules that chapter 515B now supplies.

On the resale of a Minnesota common interest community unit, the resale disclosure certificate the owner furnishes must be dated no more than:

• a.30 days before the purchase agreement or the conveyance
• b.90 days before the purchase agreement or the conveyance✓
• c.180 days before the purchase agreement or the conveyance
• d.12 months before the purchase agreement or the conveyance

Minn. Stat. 515B.4-107, paragraph (a), clause (3) requires the unit owner, before execution of any purchase agreement or otherwise before conveyance, to furnish a resale disclosure certificate from the association dated not more than 90 days prior to the date of the purchase agreement or the date of conveyance, whichever is earlier. Thirty days is stricter than the Act, and 180 days and 12 months would let the buyer rely on assessment and reserve figures the association may have changed. The owner must also furnish the declaration, articles, bylaws, rules and regulations, and any amendments, together with the master association documents where the community is subject to a master declaration.

A Minnesota unit owner asks the association for a resale disclosure certificate. The association must furnish it within:

• a.Three days after the request, and may not charge any fee
• b.Thirty days after the request, and may charge a reasonable fee
• c.Ten days after the request, and may charge a reasonable fee✓
• d.Sixty days after the request, and may charge its actual cost

Minn. Stat. 515B.4-107, paragraph (d) requires the association, within ten days after a request by a unit owner or the owner's authorized representative, to furnish the certificate required in paragraph (a), and permits the association to charge a reasonable fee for the certificate and any related association documents. Three days is shorter than the Act allows and a no-fee rule contradicts the express permission to charge. Thirty and sixty days would stall a closing timeline built around a certificate that must be no more than 90 days old. The same paragraph protects the owner: a unit owner is not liable to the purchaser for erroneous information the association supplied and included in the certificate.

A Minnesota association's lien for unpaid assessments is perfected by:

• a.Recording the declaration, with no further recording required✓
• b.Serving a written assessment demand on the delinquent unit owner
• c.Filing a claim with the registrar of titles within 120 days
• d.Recording a notice of lien with the county recorder each year

Minn. Stat. 515B.3-116, paragraph (a) gives the association a lien on a unit for any assessment levied against it from the time the assessment becomes due, and provides that recording of the declaration constitutes record notice and perfection of any assessment lien, so no further recording of a notice or claim of lien is required. Annual notices, a demand on the owner, and a filing deadline are all mechanics the Act deliberately does without. Paragraph (b) sets the lien's rank: it is prior to other liens and encumbrances except encumbrances recorded before the declaration, any first mortgage on the fee, real estate tax and governmental liens, and a master association lien, and it does not affect the priority of mechanic's liens.

Minnesota real property taxes exceeding $100 on a parcel are payable in two installments due:

• a.Before May 16 and before the following October 16✓
• b.Before April 16 and before the following September 16
• c.Before June 16 and before the following November 16
• d.Before March 16 and before the following August 16

Minn. Stat. 279.01, subd. 1, paragraph (a) provides that when the taxes against any tract or lot exceed $100, one-half of the amount due must be paid prior to May 16 and the remaining one-half prior to the following October 16, with penalties of two percent on homestead and four percent on nonhomestead property if an installment is unpaid at its due date. The other date pairs shift the schedule by a month or more and would put a proration or a closing statement wrong. Paragraph (c) adds that when taxes are $100 or less, the first-half due date and penalties apply to the entire amount, and certain seasonal recreational and class 3a commercial property has a first-half date of June 1.

After a Minnesota residential tenancy ends and the tenant gives a mailing address, the landlord must return the deposit or send a written statement of the reason for withholding within:

• a.Ten days after termination of the tenancy
• b.Six weeks after termination of the tenancy
• c.Three weeks after termination of the tenancy✓
• d.Sixty days after termination of the tenancy

Minn. Stat. 504B.178, subd. 3, paragraph (a) requires every landlord, within three weeks after termination of the tenancy and after receipt of the tenant's mailing address or delivery instructions, to return the deposit with interest or furnish a written statement showing the specific reason for withholding it, with a five-day period instead where the tenant leaves because the building was legally condemned through no fault of the tenant. Ten days is shorter than the statute allows, and six weeks and sixty days are longer. The landlord may withhold only amounts reasonably necessary to remedy defaults in rent or other funds due, or to restore the premises to their condition at the start of the tenancy, ordinary wear and tear excepted, and bears the burden of proving the reason.

A Minnesota residential security deposit held by a landlord is:

• a.Not received in a fiduciary capacity, and bears one percent simple interest✓
• b.Received in a fiduciary capacity, and bears three percent simple interest
• c.Received in a fiduciary capacity, and must sit in a broker trust account
• d.Not received in a fiduciary capacity, and bears no interest of any kind

Minn. Stat. 504B.178, subd. 2 provides that a deposit of money securing performance of a residential rental agreement is not considered received in a fiduciary capacity within the meaning of section 82.55, subdivision 26, but is held by the landlord for the tenant and bears simple noncompounded interest at the rate of one percent per annum, with any interest amount under $1 excluded. That express carve-out from the trust funds definition is why a security deposit is not automatically brokerage trust money, though section 82.75, subdivision 7 lets a broker maintain interest bearing accounts for deposits in accordance with section 504B.178. Three percent and a no-interest rule both misstate the rate the subdivision fixes.