Section 12-10-403.5 - Broker engagement contracts - residential premises - prohibited terms - definition(1) As used in this section, unless the context otherwise requires, "broker engagement contract" means a written contract in which a seller, buyer, landlord, or tenant of a residential premises becomes the client of a broker or agrees to retain the services of a broker in the future and promises to pay the broker a valuable consideration or agrees that the broker may receive a valuable consideration from another person in exchange for the broker: (a) Producing a seller, buyer, tenant, or landlord ready, able, and willing to sell, buy, or rent the residential premises; or(b) Performing other services.(2) A broker engagement contract must not:(a) Purport to be a covenant running with the land or to be binding on future owners of interests in the real property;(b) Allow for assignment of the right to provide service without notice and agreement of the owner of the residential premises; or(c) Purport to create a recordable lien, encumbrance, or other real property security interest. Any such lien, encumbrance, or other real property security interest is void and unenforceable.(3) A person who offers to a consumer a broker engagement contract that includes a provision in violation of subsection (2) of this section commits an unfair or deceptive trade practice, as provided in section 6-1-105 (1)(uuu).(4) This section does not apply to: (a) A home warranty service contract, as defined in section 12-10-901 (2)(a);(b) A building warranty or similar product that covers the cost of maintenance of a major housing or building system, such as a plumbing or an electrical system, for a specific period of time after the date on which a house or building is sold;(c) An insurance contract;(d) An option to purchase, a put requirement to purchase, a right of first offer, or a right of refusal;(e) A declaration created in the formation of a common interest community, as defined in section 38-33.3-103 (8), or an amendment to the declaration;(f) A maintenance or repair agreement entered into by a unit owners' association, as defined in section 38-33.3-103 (3);(g) A loan or a commitment to make or receive a loan, which loan or commitment is secured by real estate;(h) A security agreement under the "Uniform Commercial Code" relating to the sale or rental of personal property or fixtures;(i) Water, sewer, electrical, telephone, cable, or other regulated utility service providers; or(j) A property management agreement by which the owner of real property contracts with a party to provide management services for the maintenance, ownership, operation, or lease of a residential premises.Added by 2023 Ch. 50, § 1, eff. 8/7/2023.2023 Ch. 50, was passed without a safety clause. See Colo. Const. art. V, § 1(3).