ALJDEC decisions subject to certification as final

16F-DI-198-REL · Department of Real Estate · 2016-06-27

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 8, 2016, at 1:00 p.m. APPEARANCES: Scott A. Saunders (“Petitioner”) appeared on his own behalf; the Arizona Department of Real Estate (“the Department”) was represented by Ryan Krench, Esq., Assistant Attorney General. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT The Application On February 18, 2016, Petitioner filed an application to be licensed as a real estate salesperson with the Department. Petitioner answered “yes” to the following question on the application: “Has the Applicant . . . [b]een convicted and/or entered into a plea agreement and/or plea of NOLO CONTENDERE (no contest) to ANY felony in Arizona and/or any other state, whether or not the plea or verdict was set aside, judgment or sentencing was deferred, conviction was dismissed or expunged, or has been pardoned?”[1] On March 25, 2016, the Department informed Petitioner via certified mail that based on his April 6, 2007 convictions for endangerment, a Class 6 felony, and DUI, a Class 1 misdemeanor, and his past history of three DUIs, the Department had concluded that he did not meet the qualifications for licensure pursuant to A.R.S. § 32-2153(A)(3), (B)(2), and (B)(7). Therefore, the Department notified Petitioner that it intended to deny his license application.[2] Petitioner requested a hearing on the Department’s intended denial of his license application, stating in relevant part as follows: My DUI convictions were all from 2000-2002. My 2007 conviction was from an arrest back in 2002. . . . I have been sober for over 14 years and have completely turned my life around. While I do not deny my past behavior was deplorable and unbecoming of a state licensed employee, I believe the manner in which I have lived my life the past fourteen years warrants consideration.[3]

The Department referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. The Department issued a Notice of Hearing, charging that grounds existed under A.R.S. § 32-2153(B)(2) to deny his license application. The Notice of Hearing did not charge a violation of A.R.S. § 32-2153(B)(7). A hearing was held on June 8, 2016. Petitioner testified on his own behalf. The Department presented the testimony of Wayne L. Jackson, its Senior Investigator, and submitted seven exhibits. Hearing Evidence Petitioner’s Criminal History Petitioner did not dispute that on or about March 1, 2007, he pled guilty to one count of Endangerment, a Class 6 felony, and one count of Driving Under the Influence of Intoxicating Liquor (“DUI”), a Class 1 misdemeanor, in Maricopa County Superior Court Case No. CR2003-030899.[4] Petitioner did not dispute that on or about April 6, 2007, pursuant to his guilty plea in Case No. CR2003-030899, the court quashed the bench warrant that had been issued for Petitioner’s arrest and sentenced him to three years’ probation.[5] Petitioner explained that the two charges resulted from a motor vehicle accident involving another vehicle that occurred when he was driving while intoxicated. As a result of the accident, Petitioner was injured. On or about April 6, 2009, the court issued an order that discharged Petitioner from the concurrent probationary terms imposed for both charges in Case No. CR2003-030899.[6] Evidence of Petitioner’s Qualifications and Rehabilitation Petitioner had been licensed as a real estate salesperson in 1999 or 2000, and the license had expired. Petitioner testified that had been employed selling time shares for two months and that he did not know exactly when his license had expired. Petitioner testified that he had a string of about 5 misdemeanor DUIs between 1989 and 2002. He testified that he reported the DUIs to the Department. Petitioner testified that in 2002, the charges to which he eventually pled guilty in Case No. CR2003-030899 were dismissed without prejudice. He subsequently divorced and moved to another address. Although most mail was forwarded to his new address, he never received notice that the charges in Case No. CR2003-030899 had been refiled. As a result, a warrant was issued for his arrest. Petitioner testified that he first learned of the refiled charges in Case No. CR2003-030899 in 2006, when he was employed to transport patients to a health care facility and his employer terminated his employment because it learned of the warrant for his arrest. Petitioner testified that he had been employed as a food server in Old Town Scottsdale for 1 year and 9 months. Petitioner testified that he would like to be licensed as a real estate salesperson because he does not think that he will be physically able to run around a restaurant for the rest of his life. Petitioner credibly testified that he stopped drinking in 2002, shortly after the arrest that led to the criminal charges in Case No. CR2003- 030899. His mother and wife staged an intervention and told him that if he did not stop drinking, he would never see his children again. Petitioner took their threats seriously. Petitioner testified that he has been in rehab twice. After the first time, he was sober for three years, between 1995 and 1998. He again went to inpatient rehab after the 2002 accident that resulted in the charges in Case No. CR2003-030899. Petitioner testified that after the intervention, he started attending Alcoholics Anonymous (“AA”). A friend introduced him to a sponsor who had a reputation for being hard on the people that he sponsored. Petitioner testified that he attended 90 AA meetings in 90 days, then continued until he had attended 120 meetings in 120 days, then 180 meetings in 180 days, then a meeting every day for 12 months. He graduated to working AA’s 12- step program. Petitioner testified that during the first months after the 2002 accident, he had a fixator on his leg, could not drive, and had to either get rides or walk to the AA meetings on his crutches. Petitioner testified that he continued to attend AA meetings regularly, but not religiously. He currently attends 2-3 AA meetings each week. Drinking does not cross his mind. Petitioner testified that he currently lives with his ex-wife and two teen- aged children, who support his sobriety. Petitioner credibly testified that he has been sober for 14 years and that he has had no further interaction with law enforcement, except minor traffic violations. CONCLUSIONS OF LAW This matter lies within the Department’s jurisdiction. Petitioner bears the burden of proof to establish that he meets statutory qualifications for a real estate salesperson’s license by a preponderance of the evidence.[7] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[8] A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”[9] A.R.S. § 32-2153 provides in relevant part as follows: B. The commissioner may . . . deny the issuance of a license . . . under this chapter when it appears that the . . . applicant has: . . . .

2. Been convicted in a court of competent jurisdiction in this or any other state of a felony or of any crime of forgery, theft, extortion, conspiracy to defraud, a crime of moral turpitude or any other like offense.

Petitioner does not dispute his felony conviction for Endangerment, which is a felony. Cause therefore exists under A.R.S. § 32-2153(B)(2) for the Department to deny his license application. Petitioner has also been convicted of misdemeanor DUI. No Arizona statute defines a “crime of moral turpitude.” In 1966, the Arizona Supreme Court concluded that “the moral quality of the act” is a factor to be considered in determining whether the Arizona or United States constitutions provide a right to a jury to a criminal defendant charged with DUI, without using the term, “moral turpitude.”[10] In 2005, the Arizona Supreme Court reconsidered its conclusion in light of the problems in considering the subjective “moral quality” of statutory offenses that were not recognized at common law to decide whether the offenses involve moral turpitude: [W]e began to transform the moral quality analysis into a “moral turpitude” test, shifting our focus from the nature of the crime and toward the nature of the defendant’s character and conduct. See O’Neill v. Mangum, 103 Ariz. 484, 485, 445 P.2d 843, 844 (1968) (finding that “it can hardly be suggested that one charged or guilty of mere ‘drunk and disorderly’ conduct is a depraved and inherently base person”). In [State ex rel. Dean v. Dolny], we expanded the moral quality test even further, concluding that while we were “undoubtedly concerned with the stigma associated with certain crimes” in Rothweiler, the moral quality test is concerned primarily with “the nature of the consequences resulting from a conviction, such as . . . losing one’s driver’s license.” [161 Ariz. 297, 300, 778 P.2d 1193, 1196 (1989).] In Benitez, we expanded upon the definition of acts of moral turpitude originally pronounced in O’Neill to include “actions which ‘adversely reflect on one’s honesty, integrity, or personal values.’” 198 Ariz. at 95, 7 P.3d at 104 (citations omitted).

As the “moral quality” test became more subjective and ambiguous, inconsistent outcomes resulted. Compare [State ex rel. McDougall v.] Strohson, 190 Ariz. 120, 945 P.2d 1251 [(1997)] (holding that misdemeanor assault classified as domestic violence is not a crime of moral turpitude), and Bazanella v. Tucson City Court, 195 Ariz. 372, 988 P.2d 157 (App. 1999) (finding misdemeanor child abuse not a crime of moral turpitude), with State v. Superior Court, 121 Ariz. 174, 589 P.2d 48 (App. 1978) (holding misdemeanor shoplifting is a crime of moral turpitude), and Frederickson v. Superior Court, 187 Ariz. 273, 938 P.2d 697 (App. 1996) (finding leaving the scene of an accident to be a crime of moral turpitude). Moreover, “[b]ecause the ‘moral quality of the act’ is in the eye of the beholder, there [seemed to] be as many diverse results as there [were] judges.” Benitez, 198 Ariz. at 97 ¶ 32, P.3d at 106 (Martone, J., concurring).

We can no longer justify the use of the “moral quality” prong . . . to determine whether one charged with a misdemeanor criminal offense is entitled to a trial by jury. The test, as developed and applied, has caused inexplicable results that depend upon the evaluation by a judge that a particular crime involves “moral turpitude” or upon a judge’s conclusion that only a “depraved and inherently base person” would commit a particular offense. . . .[11]

No Arizona court has ever decided in a published opinion whether misdemeanor DUI is a “crime of moral turpitude” that furnishes cause to deny or penalize a professional real estate salesperson’s license. The Ninth Circuit, applying Arizona law, has determined that a conviction of DUI while the person’s driver’s license is suspended is not a “crime of moral turpitude” under the federal Immigration and Nationality Act (“the Act”) that requires deportation.[12] This result is consistent with other cases decided under the Act, which have concluded that DUI is not a crime of moral turpitude because “[i]t is a crime which is based on completely unintentional conduct . . ., in contrast to those crimes . . . involving some form of evil intent.”[13] The Arizona Court of Appeals has defined crimes of “moral turpitude” under A.R.S. § 32-2153(B)(2) much more narrowly than the Arizona Supreme Court in 1966 defined crimes of moral turpitude for purposes of requiring a jury trial. A crime involving moral turpitude for purposes of the real estate licensing statute must be a crime involving “a fraudulent or dishonest intent.”[14] DUI is a serious offense based on its potential to cause great injury, but it is not a crime that involves “a fraudulent or dishonest intent.” Although a misdemeanor DUI conviction may evidence irresponsibility and a lack of good character that may support denial of a license application under A.R.S. § 32-2153(B)(7),[15] that statute was not charged in this case. Therefore, Petitioner’s misdemeanor DUI conviction does not provide additional grounds to deny his license application under A.R.S. § 32- 2153(B)(2). The legislature established the Department to protect “the public health, safety and welfare by regulating the sale of real estate . . . .”[16] A person who has successfully completed his sentences may not be disqualified from employment by the state or any of its agencies.[17] Such a person may be denied a certificate to engage in an occupation “by reason of the prior conviction of a felony or misdemeanor if the offense has a reasonable relationship to the functions of the employment or occupation for which the . . . certificate is sought.”[18] A licensing proceeding “‘is not a second criminal proceeding placing [the licensee] in double jeopardy . . . . Rather, the purpose is to maintain sound professional standards of conduct for the purpose of protecting the public and the standing of the . . . profession in the eyes of the public.’”[19] “‘[T]he primary purpose of a disciplinary proceeding is the ascertainment of moral fitness and professional competency . . ., and a determination of whether it is necessary for the protection of the public interest that the [licensee] be disciplined . . . . These are public interests not addressed by the underlying criminal proceeding.’”[20] The Commissioner of the Department has discretion to grant a real estate salesperson’s license to an applicant who has been convicted of a felony if he establishes that he no longer poses an unreasonable threat to the public. The time period for which a license applicant must establish rehabilitation is commensurate with the period of misconduct and the severity of the offenses. Petitioner established that he committed the crime of endangerment in 2002, approximately fourteen years ago, when he was intoxicated. Petitioner established that he has made significant and lasting changes in his life and that he has maintained a more than a 14- year period of sobriety since he committed the offense. Petitioner established that he has rehabilitated and that he no longer poses an unreasonable risk to the public if he is licensed as a real estate salesperson. RECOMMENDED ORDER Based on the foregoing, it is recommended that Petitioner’s appeal is upheld and that he shall be granted a real estate salesperson’s license. In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be five days from the date of that certification. Done this day, June 27, 2016.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

Judy Lowe, Commissioner Arizona Department of Real Estate ----------------------- [1] The Department’s Exhibit 1 at 2. [2] See the Department’s Exhibit 6. [3] The Department’s Exhibit 7. [4] See the Department’s Exhibit 2. [5] See the Department’s Exhibit 3. [6] See the Department’s Exhibit 4 and 5. [7] See A.R.S. § 41-1092.07(G)(1); A.A.C. R2-19-119; see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [8] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [9] Black’s Law Dictionary at page 1220 (8th ed. 1999). [10] Rothweiler v. Superior Court, 100 Ariz. 37, 41, 410 P.2d 479, 483 (1966). [11] Derendal v. Griffith, 209 Ariz. 416, 423-24,104 P.3d 147, 144-45 (2005). [12] See Hernandez-Martinez v. Ashcroft, 329 F.3d 1117, 1118-19 (9th Cir. 2003). [13] People of New York v. Montilla, 134 Misc. 2d 868, 870, 513 N.Y.S.2d 338, 340 (1987); see also Matter of Lopez-Mesa, 22 I. & N. Dec. 1188 (BIA 1999). [14] Howard v. Nicholls, 127 Ariz. 383, 388, 621 P.2d 292, 297 (App. 1980). [15] A.R.S. § 32-2153(B)(7) provides in relevant part as follows: B. The commissioner may suspend or revoke a license, deny the issuance of a license, issue a letter of concern to a licensee, issue a provisional license or deny the renewal or the right of renewal of a license issued under this chapter when it appears that the holder or applicant has: . . . . 7. Not shown that the holder or applicant is a person of honesty, truthfulness and good character. [16] See Laws 1992, Ch. 14, § 3. [17] See A.R.S. § 13-904(E). [18] Id.

[19] Schillerstrom v. State Board of Chiropractic Examiners, 180 Ariz. 468, 470, 885 P.2d 156, 158 (App. 1994), review denied, December 20, 1994 (quoting Kaplan v. Department of Registration and Educ., 46 Ill. App. 3d 968, 5 Ill. Dec. 303, 308, 361 N.E.2d 626, 631 (1977) (citations omitted)). [20] Id. at 470-71, 885 P.2d at 158-59 (quoting Matter of Rabideau, 102 Wis. 2d 16, 26-27, 306 N.W.2d 1, 7, appeal dismissed, 454 U.S. 1025, 102 S. Ct. 559, 70 L. Ed. 2d 469 (1981) (citations omitted)).

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