KRS § 324.420 — KY Code / Title XXVI / Chapter 324 / Section 324.420
324.420 Collection by aggrieved party from recovery fund
Status: in_force

324.420 Collection by aggrieved party from recovery fund.

(1) An aggrieved party may commence an administrative action which may result in

collection from the recovery fund by first filing a complaint with the commission on

a form prepared by the commission. The complaint shall constitute a prima facie

case that a licensee is in violation of KRS 324.160 and is subject to the same

conditions set forth in KRS 324.150. If the complaint constitutes a prima facie case

and the matter is not settled, the commission shall hold a hearing pursuant to the

requirements set forth in the provisions of this chapter and KRS Chapter 13B to

determine if a violation of this chapter has in fact occurred. If a violation of fraud is

so found, the commission shall determine if the violation resulted in damages to

complainant and in what amount. If damages cannot be accurately determined, then

the amount of damages shall be determined by a Circuit Court in the county where

the violation took place. In the event the question of damages is referred to the

Circuit Court, the decision of the commission will not be final and appealable until

the question of damages is certifiable.

(2) Upon final order by the commission or upon certification to the commission by the

Circuit Court on the issue of damages, and after the licensee has refused to pay the

claim within a period of twenty (20) days of entry of a final order, the aggrieved

party or parties shall be paid the amount or amounts by the commission from the

recovery fund.

(3) The license of the licensee against whom the claim was made by the aggrieved party

shall be suspended or may be permanently revoked until such time as the licensee

has reimbursed the recovery fund in full for all amounts paid, plus interest at the

rate of ten percent (10%) per annum.

(4) Any party aggrieved by a final order of the commission may appeal to the Circuit

Court where the licensee has his principal place of business or where the applicant

resides in accordance with KRS Chapter 13B.

(5) Upon the final order of the court, and after the commission has paid from the real

estate education, research, and recovery fund any sum to the aggrieved party, the

commission shall be subrogated to all of the rights of the aggrieved party to the

extent of the payment. The aggrieved party shall to the extent of the payment assign

his right, title and interest in the judgment to the commission. After such

assignment, the commission may challenge in bankruptcy court any attempt by a

former licensee to discharge the debt, if proper notice is given. Any funds recovered

by the commission shall be deposited in the real estate education, research, and

recovery fund.

(6) No aggrieved party shall be entitled to recover compensation from the real estate

education, research, and recovery fund unless the action against the licensee is

commenced within one (1) year from actual knowledge of the cause of action or

from the time when circumstances should reasonably have put the aggrieved party

on notice of the cause of action.

(7) An aggrieved party shall not be entitled to recover compensation from the real

estate education, research, and recovery fund, unless the compensation is for the

actual financial harm suffered by the aggrieved party, and this financial harm is

specifically and directly related to the property.

(8) For purposes of this section, an "aggrieved party" shall mean either:

(a) A member of the consumer public who stands in a direct relationship to the

licensee, i.e., one who demonstrates an interest in purchasing, leasing, renting,

or otherwise securing an interest in real estate through a licensee and who

believes that the licensee is in violation of the provisions of this chapter; or

(b) A member of the consumer public who directly engages the services of a

licensee for purposes of selling, leasing, renting, or otherwise dealing in his or

her own property.

(9) If at any time the money on deposit in the real estate education, research and

recovery fund is insufficient to satisfy any duly-authorized claim or portion thereof,

the commission shall, when sufficient money has been deposited in the real estate

education, research, and recovery fund, satisfy such unpaid claim or portions

thereof, in the order that such claims or portions were originally filed, plus

accumulated interest at the rate of ten percent (10%) per annum.

(10) Any funds in excess of the four hundred thousand dollar ($400,000) level which are

not being currently used, may be invested and reinvested as set forth in subsection

(2) of KRS 324.410.