§2781.1. Real estate broker privilege on commercial real estate; definition; recordation; ranking; collection of open account

           A. A special privilege affecting the interest of the person with whom he has contracted is hereby granted to a licensed real estate broker for the amount of his commission on all commercial real estate for which he negotiates the sale, exchange, purchase, lease, transfer, or other act of conveyance, pursuant to a written agreement between the broker asserting the privilege and a person having legal capacity to transfer or acquire an interest in the real estate.

           B. Valid recorded privileges and all mortgages, whether recorded prior or subsequent to, shall have priority over a broker's privilege, including but not limited to:

           (1) Valid materialman's or laborer's liens which are recorded subsequent to the broker's privilege but which related back to a date prior to its recordation.

           (2) All mortgages, whether to secure revolving credit, future advances, construction loans, including all renewals thereof, even if the renewals are evidenced by an entirely new mortgage and the old mortgage is cancelled.

           (3) All vendor's liens.

           C.(1) A notice of broker privilege shall be filed at least five days prior to the sale in the parish in which the commercial real estate is located. Such notice shall also be given to the purchaser by certified mail at least five days prior to the sale.

           (2) The person claiming a privilege shall commence proceedings by filing a complaint within one year after the filing of the notice. The failure to do so shall extinguish the lien. No subsequent notice shall be given for the same claim, nor shall that claim be asserted in any proceeding under this Section.

           (3) A complaint may be withdrawn by the mutual consent of the person claiming the privilege and any other party or parties to the written agreement specified in Subsection A.

           (4) The privilege may be released by the posting of a bond or other assets with the court sufficient in value to cover the full value of the claim. This escrowed amount shall be disbursed by the court upon the finality of a judicial decision and in a manner consistent with the decision.

           D. The commission owed a real estate broker as provided in Subsection A of this Section is an "open account" for purposes of R.S. 9:2781.

           E. As used in this Section, "commercial real estate" means real estate as defined in R.S. 37:1431, but does not include single family residential units such as condominiums, townhouses, or houses in a subdivision when sold, leased, transferred, or otherwise conveyed on a unit by unit basis or in units of six or fewer, real estate on which no building or other structure is permanently attached, real estate classified as farmland for assessment purposes, or residential real estate as defined in the federal Real Estate Settlement Procedures Act.

           F. If pursuant to this Section a broker acquires rights and receives prepaid commissions and the transaction which gives rise to the right to receive such commissions fails as a result of the fault of the broker, the broker shall return the unearned prepaid commissions.

           Acts 1995, No. 770, §1.