ALJDEC

01A-025-REL · Department of Real Estate · 2001-05-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 2, 2001

APPEARANCES: Applicant appeared on her own behalf; the State of Arizona, Department of Real Estate was represented by Assistant Attorney General Janet Gustafson.

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Applicant Margaret Olson brings this appealable agency action protesting the Arizona Department of Real Estate’s denial of her application for a real estate salesperson’s license. The Department based the denial on Applicant’s felony convictions from 1984 and other character evidence. The parties presented evidence and testimony at the hearing. Based on the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order that the Commissioner grant a provisional (probationary) license. FINDINGS OF FACT 1. Applicant passed the written examination for a real estate salesperson’s license in November 2000, and filed an application for licensure. (Exhibit A.) She disclosed several criminal convictions, dating back to 1984. (Exhibit B.) 2. In 1983, Applicant rented a U-Haul truck and failed to return it. She kept the kept the truck for three months before she was caught with it. (Exhibit I.) She was indicted in Ohio for grand theft. (Exhibit D.) 3. In February 1984, Applicant pleaded guilty to one count of grand theft of a motor vehicle, a class 3 felony, in Montgomery County, Ohio. (Exhibit E.) Her sentence was suspended and she was placed on probation for a five-year term. (Exhibit F.) 4. Also in 1983, Applicant wrote numerous checks on an account that was not hers, for which she was indicted on ten counts of forgery. (Exhibit J.) 5. In February 1984, Applicant pleaded guilty to one count of forgery, a class 4 felony, in Montgomery County, Ohio. (Exhibit K.) Her sentence was suspended and she was placed on probation for a five-year term. (Exhibit L.) This conviction and sentence was concurrent with the grand theft conviction and sentence. 6. Applicant did not complete her probation for quite some time. According to Applicant’s testimony, which is the only evidence available on that subject in this record, she left Ohio for Indiana and then Arizona in the late 1980’s, thus violating her probation and resulting in the issuance of warrants. Her application addenda state that Applicant began attempting to clear up the outstanding probation matter in the late 1990’s, but that the Ohio courts were having trouble because the convictions were so old. (Exhibit B.) 7. In May 2000, Applicant finally took care of the matter. She paid her outstanding fines and the Ohio court reinstated her probation for both convictions, then immediately terminated probation on both convictions. (Exhibits G and M.) Applicant has therefore completed her terms of probation. 8. The record also discloses arrests for shoplifting in 1983 in Ohio and solicitation to commit prostitution in Phoenix, Arizona in 1991. (Exhibits C and N.) Whether these arrests resulted in convictions is not clear. The record does not contain any court records, only police reports. According to Applicant, she pleaded guilty to a misdemeanor offense in Phoenix, but there is no primary information showing this. Furthermore, Exhibit H shows only the grand theft and forgery convictions in Ohio. Exhibit O appears to show that the shoplifting case was dismissed in October 1983. 9. This tribunal finds that the evidence does not show by a preponderance that the Ohio shoplifting arrest resulted in conviction. Therefore, that information is used only for the limited purpose of showing character. 10. Furthermore, the Phoenix solicitation conviction has not been shown to be a felony or a crime of forgery, theft, extortion, conspiracy to defraud, crime of moral turpitude, or any similar offense. Therefore, it too is relevant only to character. 11. Applicant submitted three reference letters with her application. (Exhibits 1 through 3.) These letters are in the nature of job reference letters rather than character reference letters, but they do offer character assessments as well. Exhibit 1 is from a former co-worker of Applicant’s, and attests to her good work ethic. Exhibit 2 is from Applicant’s personal friend and attests to her compassion for others. Finally, Exhibit 3 is from a friend who is a retired Phoenix police commander. It speaks highly of Applicant’s personal and communication skills. All three of the authors of exhibits have known Applicant for a number of years. 12. While these three exhibits offer some evidence as to character, their weight is diminished because the authors did not appear and testify in person. Therefore, the authors’ credibility cannot be determined and the letters’ reliability and accuracy is unknown. Therefore, Exhibits 1 through 3 are given only a little weight by this tribunal. 13. In March 2001, the Department denied Applicant’s application based on the convictions. Applicant appealed, noting that she has changed since the convictions. (Exhibit Q.) 14. Applicant testified at the hearing that she committed the crimes during “a bad time in [her] life.” She was taking drugs and needed money. In the early 1990’s, she “cleaned up.” She studied to become a Physician’s Assistant from 1992 to 1996. She has also held several jobs for significant periods in which she had significant responsibilities. She does a good deal of community service work presently, talking to teens about the dangers of drug abuse. She testified that she has a great desire to sell real estate. 15. Applicant presented one character witness at the hearing. Kimberly Chapman is a friend of Applicant who has known her for four years. She testified that she trusts Applicant and she has been impressed with Applicant’s community service work. CONCLUSIONS OF LAW 1. Applicant must show that she meets the qualifications for licensure. Arizona Revised Statutes (A.R.S.) § 32-2124. The Commissioner has discretion to deny a license application for any of the reasons listed in A.R.S. § 32-2153(A) and (B). The Department has alleged that grounds for denial of Applicant’s application exist under that statute per subsections (B)(2)--conviction of any “crime of forgery, theft, extortion, conspiracy to defraud, a crime of moral turpitude or any other like offense;” (B)(5)—having engaged in fraudulent or dishonest conduct; (B)(7)--not being a person of honesty, truthfulness, and good character; (B)(9)—violating the terms of any criminal or administrative order; and (B)(10)--violating state or federal law that involves forgery, theft, fraud, etc. 2. Applicant’s grand theft and forgery convictions are significant instances of dishonesty and criminal action. But, they occurred almost twenty years ago. Of more concern is Applicant’s “skipping out” on her Ohio probation. That action shows an utter lack of respect for authority. But, again, it occurred some time ago and there is evidence of change since then. Furthermore, the Ohio court did not think much of it and summarily concluded it. 3. There is no question that Applicant has committed crimes that fall within subsections (B)(2) and (B)(10) of the statute, and has committed conduct condemned by subsections (B)(5) and (B)(9). But that does not automatically disqualify Applicant. The Arizona Legislature has left licensing decisions to the Commissioner’s discretion. 4. In Applicant’s case, there is a great deal of mitigation. It is noteworthy that the convictions are significantly distant. This is substantial only if an applicant shows successful change during the period between the conviction and application, and Applicant has presented some evidence of character change in the mid- to late-1990’s. While the evidence presented is not compelling, it is worthy of consideration. 5. Moreover, there is some evidence tending to show that Applicant’s present character is good. She submitted evidence regarding trustworthiness that, while again not compelling, is noteworthy. Thus, the evidence as to the subsection (B)(7) good character requirement provides grounds for denial, but does not preclude licensure. 6. Taking all of the evidence into account, the record fails to show that Applicant should be precluded from licensure. That conclusion is based on Applicant’s demeanor while testifying and the more recent evidence regarding Applicant’s character. The evidence shows that Applicant has made significant changes in her lifestyle and has taken responsibility for her conduct. Her talks to teens show maturity and insight into her past actions and their consequences. However, there is also evidence that warrants caution. From the evidence of record, Applicant has not shown that she should receive a regular license, but she has shown that she should be granted a provisional license as provided in A.R.S. § 32-2153(E). 7. The provisional license should include such terms and conditions as the Commissioner deems appropriate, but at a minimum the following terms: (1) Applicant shall provide the Department’s Compliance Officer with quarterly written statements from her designated broker showing that she is active and is properly fulfilling her duties as a real estate salesperson; and (2) Applicant shall post a $5000.00 bond. These terms apply to the two- year provisional period. Upon request for renewal, the Commissioner should consider granting a regular license. RECOMMENDED ORDER Based on the findings and conclusions above, IT IS RECOMMENDED that the Commissioner of the Arizona Department of Real Estate grant Margaret Olson a provisional license as a real estate salesperson.

Done this 21st day of May 2001.

OFFICE OF ADMINISTRATIVE HEARINGS

______________________________________ Eric A. Bryant Administrative Law Judge

Original mailed this ___ day of May 2001, to:

Jerry Holt, Commissioner Arizona Department of Real Estate ATTN: Gloria Konya 2910 N. 44th Street, Suite 100 Phoenix, AZ 85018

By ___________________________ -----------------------

Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826