What’s the Mandatory Use Date Have to Do with It?


 Cori Lamont  |    October 14, 2020
Mandatory Use Date

As the WRA legal team, we often focus on educating and informing WRA members about the changes and impacts to the transaction when a new state-approved (WB) form is approved for use by the Real Estate Examining Board (REEB). However, we thought it might be helpful to remind everyone of the basics of what happens when a new WB form is approved by the REEB and the mandatory use date arrives. 

Example, the WB-14 Residential Condominium Offer to Purchase had an optional use date of August 1, 2020, and a mandatory use date of September 1, 2020. 

What is a WB form? 

The WB forms are forms approved by the REEB. 

Wis. Admin. Code § 16.02 (1e) 
“Approved form” means a contractual or conveyance form which is either prepared and approved by the board, pursuant to s. 452.05 (1) (b), Stats., or approved in s. REEB 16.03.

Who must use the WB forms?

Wisconsin real estate licensees must use WB forms. Therefore, buyers, sellers and attorneys are not required to use WB forms. 

Wis. Admin. § REEB 16.04 When to utilize approved forms.
(1) Except as provided in subs. (2) and (3), a licensee shall use approved forms when acting as an agent or a party in a real estate or business opportunity transaction.
(2) For those kinds of real estate or business opportunity transactions for which the board has not approved contractual forms, a licensee, when acting as an agent or a party, may use contractual forms drafted by a party or an attorney, if the name of the drafter is imprinted on the form before use by a licensee. For the purpose of this subsection, a listing firm is a party to the listing contract transaction.
(3) A licensee may in any transaction where the licensee is acting as an agent, negotiate an agreement and permit the parties or an attorney for one or other of the parties to draft or prepare a contractual agreement which embodies all of the negotiated terms and conditions.

What does it mean to use a WB form? 

Wisconsin administrative code essentially indicates that to use a form means to complete a contractual form by filling in the blanks or modifying the printed provisions for the purpose of accomplishing the instruction of a party in the real estate transaction. 

Wis. Admin. Code § 16.02 (5)
“Use a form” means to complete a contractual or conveyance form by filling in the blanks or modifying printed provisions on a form for the purpose of accomplishing the instruction of a party in a specific real estate transaction.

What does the optional use date on the WB forms mean for Wisconsin real estate licensees?

Once an optional use date arrives, real estate licensees may choose to use the form. 

What does the mandatory use date on the WB forms mean for Wisconsin real estate licensees? 

Once the mandatory use date arrives, real estate licensees must use the form. Wis. Admin. Code REEB 16.06(7) requires licensees to use the latest approved version of the form.  

Wis. Admin. Code § REEB 16.06
(7)
 A licensee shall use the latest approved version of a board-approved form.”

What happens if a licensee does not use the form when the mandatory use date arrives?

The licensee could be deemed too incompetent to practice. Wis. Stat. 452.14 allows the REEB to discipline a licensee for failure to use approved forms. 

Wis. Stat. §  452.14 Investigation and discipline of licensees. 
(3) The board may revoke, suspend, or limit the license of any licensee, or reprimand the licensee, if it finds that the licensee has done any of the following: 
(m) Failed to use forms approved under s. 452.05 (1) (b).

What if you receive an offer from another agent on the “old” form?

  1. You must present the offer regardless if the offer is on the “old” WB form or a different form all together. 
    Wisconsin administrative rules emphasizes that licensees shall promptly present all received written proposals to the client or customer. Licensees are required to promptly present all written proposals to their clients and customers — in other words, buyers, sellers, owners, tenants and others seeking an interest in real estate or a business opportunity.
    LESSON: When you receive an offer, a counter-offer or an amendment, promptly advise your clients that they have received such document and promptly present that document to them. 
  2. You should let your seller know there is a different offer or the applicable WB form that has been approved for use by the REEB for real estate licensees other than the one submitted by the buyer. You should also let the seller know it is their prerogative to accept the offer even though it is not the most current form for use by Wisconsin real estate licensees. Further, the licensee is encouraged to document, preferably in writing, that this conversation occurred with the seller. 
  3. You could also choose to politely remind the agent who submitted the offer that the form was revised and now is required for use by real estate licensees.

Therefore, be mindful of when the REEB approves a new form and when the form is required for use by looking at the mandatory use date.

Wis. Stat. § 452.40 Use of forms; provision of legal advice. 
(1) (a) In this subsection, “use a form” means to complete a form by filling in blanks or modifying printed provisions on the form at the instruction of one or more parties with whom a licensee is working or representing in a specific transaction. (b) A firm and any licensee associated with the firm may use a form approved by the board under s. 452.05 (1) (b) in real estate practice.

(2) A licensee may not provide advice or opinions concerning the legal rights or obligations of parties to a transaction, the legal effect of a specific contract or conveyance, or the state of title to real estate. A licensee may provide a general explanation of the provisions in a form approved by the board under s. 452.05 (1) (b) to the parties to a transaction at the time of completing the form or when delivering an approved form for the seller’s or buyer’s acceptance. Reviews conducted by a supervising broker under s. 452.132 (4) shall not be considered to be the provision of legal advice or opinion.

Cori Lamont is Senior Director of Legal and Public Affairs for the WRA.

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