Real Estate Practice in North Dakota
North Dakota practice includes handling client funds through broker trust accounts, carrying required errors and omissions insurance, and disclosing material facts. This chapter covers trust money, E&O insurance, and disclosure duties.
Trust Accounts and Client Funds
Client funds such as earnest money must be handled through the broker's trust (escrow) account and kept separate from the broker's personal and business funds. A salesperson who receives client money must promptly deliver it to the employing broker for deposit. Commingling or converting trust money is one of the most serious violations of NDCC 43-23.
Errors and Omissions Insurance
North Dakota requires active real estate licensees to carry errors and omissions (E&O) insurance, and the Commission makes a group policy available that licensees may use to satisfy the requirement. A licensee who does not maintain the required coverage may not hold an active license. This requirement protects consumers and licensees when claims arise from professional services.
Disclosure and Honest Dealing
Licensees must disclose known material adverse facts about a property they are marketing and may not misrepresent or help conceal defects. Advertising must be truthful and conducted under the employing broker; a salesperson may not advertise listed property independently of the broker. Honest, supervised practice protects consumers and reduces the licensee's exposure to complaints.