Louisiana Real Estate Salesperson Exam — All Questions

In Louisiana, who is responsible for maintaining the sales escrow or trust account that holds client funds such as deposits?

• a.Each individual salesperson
• b.The parish clerk of court
• c.The sponsoring broker✓
• d.The Louisiana Real Estate Commission

The sponsoring broker is responsible for the brokerage's sales escrow or trust account in Louisiana. Client funds such as deposits must be placed in that account, kept separate from the broker's own funds, and accounted for. Commingling client funds violates Louisiana license law.

The Louisiana Real Estate Recovery Fund is designed to:

• a.Guarantee a minimum commission to licensees
• b.Reimburse members of the public who obtain an unpaid court judgment against a licensee for certain violations, up to statutory limits✓
• c.Cover the Commission's administrative salaries
• d.Provide down-payment assistance to buyers

The Louisiana Real Estate Recovery Fund reimburses members of the public who obtain a valid but unpaid court judgment against a licensee for certain violations of the license law, subject to statutory per-transaction and per-licensee caps. A licensee who triggers a payout may have their license suspended until the fund is repaid.

A Louisiana husband alone signs a purchase agreement selling the family home, which is community property. His wife never signs. What is the problem?

• a.Nothing, since either spouse may act alone for the community
• b.Both spouses must concur to alienate a community immovable✓
• c.Only the spouse named on the title had to sign the agreement
• d.The agreement had to be passed before a notary and two witnesses

Louisiana's community property regime requires the concurrence of both spouses for the alienation, encumbrance, or lease of community immovables, standing, cut, or fallen timber, furniture in the family home, all or substantially all of the assets of a community enterprise, and movables registered jointly. License law separately makes a listing agreement valid only if signed by all owners or their authorized attorney in fact. Cite: La. Civil Code art. 2347(A); La. R.S. 37:1431(17).

During her marriage a Louisiana woman inherits a camp from her father. How is that camp classified?

• a.Community property
• b.Community property unless she records a declaration
• c.Separate property✓
• d.Separate property only if the succession judgment says so

Separate property includes property acquired by a spouse by inheritance or by donation to him individually, property owned before the community regime began, and property bought with separate funds. Things in a spouse's possession during the community are presumed community, but either spouse may prove that a particular thing is separate. Cite: La. Civil Code arts. 2341 and 2340.

A Louisiana man dies intestate leaving children. What does his surviving spouse take in his half of the community?

• a.A usufruct ending at her death or her remarriage✓
• b.Full ownership of the decedent's half of the community
• c.A usufruct for her lifetime that nothing can terminate
• d.Nothing at all, because the children take it outright

If the deceased spouse is survived by descendants, the surviving spouse has a usufruct over the decedent's share of the community property to the extent he did not dispose of it by testament, and that usufruct terminates when the surviving spouse dies or remarries, whichever occurs first. A usufruct is a real right of limited duration on the property of another. Cite: La. Civil Code arts. 890 and 535.

A Louisiana spouse dies rich in comparison with the survivor. What may the survivor claim out of the succession?

• a.A homestead allowance fixed by the district court
• b.The marital portion✓
• c.Dower
• d.An elective share of one-third of the whole estate

Louisiana, a civil law jurisdiction, never adopted dower or curtesy. Instead, when a spouse dies rich in comparison with the surviving spouse, the survivor may claim the marital portion: one-fourth of the succession in ownership if the decedent left no children, the same fraction in usufruct for life if survived by three or fewer children, and a child's share in that usufruct if survived by more than three. The marital portion may not exceed one million dollars. Cite: La. Civil Code arts. 2432 and 2434.

Who are forced heirs in Louisiana?

• a.All of the decedent's children, whatever their ages
• b.The surviving spouse together with all descendants
• c.Any descendant who was living with the decedent at his death
• d.First-degree descendants twenty-three or younger, or permanently incapable at any age✓

Forced heirs are descendants of the first degree who at the decedent's death are twenty-three years of age or younger, or descendants of the first degree of any age who are permanently incapable of caring for their persons or administering their estates because of mental incapacity or physical infirmity. Donations may not exceed three-fourths of the donor's property if he leaves one forced heir, or one-half if he leaves two or more. Cite: La. Civil Code arts. 1493(A) and 1495.

A Louisiana owner sells a tract for eighty thousand dollars that was worth two hundred thousand. What remedy does the Civil Code give him?

• a.An action in redhibition for the inadequate price
• b.None, because the agreed price is the price owed
• c.Rescission for lesion beyond moiety✓
• d.Reformation of the act of sale by the parish clerk

The sale of an immovable may be rescinded for lesion when the price is less than one half of the fair market value of the immovable. Lesion may be claimed only by the seller, only in sales of corporeal immovables, and never in a sale made by order of the court, and the seller may invoke it even if he renounced the right. The action is subject to a one-year peremptive period running from the sale. Cite: La. Civil Code arts. 2589 and 2595.

Louisiana does not use the common law term easement. What is the civil law right charged on one tract for the benefit of another?

• a.A predial servitude✓
• b.A usufruct
• c.A predial lease of the servient tract
• d.A conventional mortgage on the servient tract

A predial servitude is a charge on a servient estate for the benefit of a dominant estate, and the two estates must belong to different owners. Some servitudes arise by operation of law: the estate situated below is bound to receive the surface waters that flow naturally from the estate above, unless an act of man created the flow. Cite: La. Civil Code arts. 646 and 655.

In Louisiana, when does ownership of an immovable pass between the buyer and the seller?

• a.When the act of sale is filed in the conveyance records
• b.As soon as they agree on the thing and the price is fixed✓
• c.When the purchase price has been paid in full to the seller
• d.When the buyer is put into physical possession of the property

Sale is a contract by which a person transfers ownership of a thing for a price in money, and the thing, the price, and the consent of the parties are required to perfect it. Ownership transfers between the parties as soon as there is agreement on the thing and the price is fixed, even though the thing is not yet delivered and the price is not yet paid. Recordation is what makes the transfer effective against third persons. Cite: La. Civil Code arts. 2439, 2456, and 3338.

A Louisiana lease of an immovable and an option to purchase it are signed but never recorded. What is the consequence?

• a.They are absolutely null between the parties
• b.They remain valid for no more than five years
• c.They are without effect as to third persons✓
• d.They bind third persons who knew of them in fact

The rights and obligations created by an instrument that transfers an immovable or establishes a real right in one, by the lease of an immovable, or by an option, right of first refusal, or contract to buy, sell, or lease an immovable are without effect as to a third person unless the instrument is recorded in the appropriate conveyance or mortgage records. Cite: La. Civil Code art. 3338.

How long must a possessor hold a Louisiana immovable to acquire ownership by prescription without just title or good faith?

• a.Ten years
• b.Twenty years
• c.Three years
• d.Thirty years✓

The requisites for acquisitive prescription of ten years are possession of ten years, good faith, just title, and a thing susceptible of acquisition by prescription. Without just title or good faith, ownership and other real rights in immovables may still be acquired by the prescription of thirty years. Cite: La. Civil Code arts. 3475 and 3486.

After closing, a Louisiana buyer finds a hidden defect that makes the house all but unusable. Which action does the Civil Code give him?

• a.An action in lesion
• b.An action in redhibition✓
• c.An action to reform the act of sale
• d.An action in eviction against the seller

The seller warrants the buyer against redhibitory defects in the thing sold. A defect is redhibitory when it renders the thing useless, or its use so inconvenient that a buyer must be presumed not to have bought it had he known, which gives the buyer the right to rescission; a defect that merely diminishes usefulness or value limits him to a reduction of the price. Cite: La. Civil Code art. 2520.

What makes a Louisiana act of sale an authentic act?

• a.Execution before a notary and two witnesses, all of whom sign✓
• b.Recording it in the parish conveyance records
• c.The signature of both parties before a notary public
• d.An attorney's certificate of title attached to the act

An authentic act is a writing executed before a notary public or other authorized officer, in the presence of two witnesses, and signed by each party who executed it, by each witness, and by each notary before whom it was executed. It need not all be signed at one time or place so long as each party signs before a notary and two witnesses. Cite: La. Civil Code art. 1833(A) and (B).

A Louisiana seller hands over the property disclosure document after the buyer has already made his offer. What may the buyer do?

• a.Terminate at any time before the act of sale is passed
• b.Nothing, because his offer became binding when made
• c.Terminate within seventy-two hours of receiving the document✓
• d.Demand a price reduction equal to the cost of repairs

The seller must deliver the completed and signed property disclosure document no later than the time the purchaser makes an offer. If it comes later, the purchaser may terminate the resulting contract or withdraw the offer no later than seventy-two hours after receipt, excluding weekends and federal and state holidays, without penalty and with any deposit promptly returned. The right is waived if not exercised before transfer of title or occupancy, whichever comes first. Cite: La. R.S. 9:3198(B)(2) and (3).

How much of a Louisiana broker's own money may sit in the firm's sales escrow checking account?

• a.None whatsoever, under any circumstance
• b.One month of anticipated bank service charges
• c.Up to ten percent of the balance in the account
• d.Up to two thousand five hundred dollars for bank service charges✓

A sum not to exceed two thousand five hundred dollars may be kept in each sales escrow, rental trust, and security deposit trust checking account, specifically identified and deposited to cover bank service charges on that account, and used for no other purpose. A broker engaged in property management may keep more than that in a rental trust account for the temporary and limited purpose of meeting obligations for clients. Cite: LAC 46:LXVII.2713(A) and (B).