ALJDEC decisions subject to certification as final

16F-DI-201-REL · Department of Real Estate · 2016-08-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 7, 2016 with the record held open to permit Petitioner to submit a letter from a designated broker in support of the issuance of a provisional license and for Arizona Department of Real Estate (Department) to respond to any letter that might be provided. After the Department responded that one of Petitioner’s character witnesses had recanted her testimony and raised additional questions about Petitioner’s character, a further hearing was convened on August 22, 2016 to consider this subsequently discovered evidence. APPEARANCES: Heather Joyce (Petitioner) represented herself. The Department was represented by Assistant Attorney Ryan Krench, Esq. ADMINISTRATIVE LAW JUDGE: Suzanne Marwil _____________________________________________________________________ FINDINGS OF FACT On February 22, 2016, Petitioner submitted an application for a real estate salesperson’s license to the Department. In her application, Petitioner acknowledged that she had entered into a deferred prosecution program for charges involving criminal damage, disorderly conduct/domestic violence, been convicted of extreme Driving Under the Influence ("DUI"), a misdemeanor, and been convicted of making a fraudulent insurance claim, a misdemeanor. On her application, Petitioner answered “Yes” to the following questions: a. Question 6: “Had any judgment and/or order entered against you by ANY court involving fraud, dishonesty, misrepresentation, unfair trade practice, or moral turpitude?” b. Question 13: “Been convicted or entered into a plea agreement or a plea of NOLO CONTENDERE (no contest) to ANY misdemeanor in Arizona or any other state, whether or not the plea or verdict was set aside, judgement or sentencing was deferred, conviction was dismissed or expunged, or you have been pardoned?”

c. Question 15: “Currently incarcerated, paroled, and/or on probation because of ANY conviction?”

On March 28, 2016, the Department issued an Intent to Deny Letter, informing Petitioner that she did not possess the qualifications for licensure. The letter provided, in relevant part, as follows: The [Department] has reviewed your application for Original Real Estate Salesperson’s License and has determined that you do not meet the qualifications for licensure pursuant to A.R.S. §§ 32-2123, 32- 2124 and 32-2153. This conclusion is based in part, but not exclusively, on your March 3, 2011 entry into a deferred prosecution program for criminal damage and disorderly conduct/domestic violence, both class 1 misdemeanors, your June 19, 2012 conviction for extreme DUI, a misdemeanor, and your April 2, 2013 conviction for fraudulent insurance claim, a misdemeanor. The Department considers your conduct to have violated Arizona Revised Statutes and/or Arizona Administrative Code, including, without limitation: A.R.S. § 32-2153 (A)(3), (B)(2), (B)(3), (B)(5), (B)(7) and (B)(10).

Petitioner disagreed with the Department’s determination to deny her license application and requested an administrative hearing. On or about February 19, 2011, Petitioner was arrested for criminal damage and disorderly conduct/criminal damage. On March 3, 2011, Petitioner entered into a deferred prosecution program regarding these misdemeanors charged in case number MCR-2011-00166. Petitioner paid court fees and attended anger management classes, leading to the dismissal of these charges on March 18, 2016. At the June 2016 hearing, Petitioner testified that these charges arose after her boyfriend locked her out of their home and she broke a lock to get in after waiting in the garage for quite some time. Petitioner alleged that her boyfriend physically abused her, leading her to call the police. When the police arrived, however, Petitioner testified that they choose to believe the boyfriend’s version of events because he was a prominent physician in town and arrested her on charges of criminal damage and domestic violence. Petitioner had photographs with her purporting to show the bruises her boyfriend inflicted upon her during that incident. On or about October 11, 2011, Petitioner was arrested for Driving Under the Influence, a misdemeanor, in the county of San Diego, case number TR- [number redacted]. Petitioner plead guilty on June 19, 2012 was sentenced to five years unsupervised probation, fines and classes. At the June 2016 hearing, Petitioner testified that these charges arose after she had a drink and then was driving home. She believed someone put an unidentified substance in her drink. Petitioner indicated she was not thinking clearly and did not want to have her car towed so she chose to drive to her apartment. While driving in the parking garage, Petitioner noted she slid into a block wall. Petitioner recalled going to her apartment after which the police came to her door and arrested her. Petitioner was adamant that she would never willingly drive impaired and viewed herself as the victim of the individual who “compromised” her drink. Petitioner further testified that she broke her ankle as a result of hitting the block wall, had surgery and was given morphine. While in the hospital, she recalled giving a statement to the insurance company, but could not remember the contents of her statement. She moved to Florida after being released from the hospital and was surprised to learn several months later that the insurance company claimed she had given it a fraudulent statement. Petitioner said she went to considerable expense to go back to California and answer the charges. Ultimately, Petitioner was convicted of making a fraudulent insurance claim, a misdemeanor, on April 2, 2013. Petitioner said she agreed to the guilty plea because she was told that she simply had to pay a fine and just wanted to get out of there and get on with her life. On December 15, 2015, the case was dismissed as Petitioner completed probation. Petitioner testified that she had spent significant time working really hard to get her real estate salesperson’s license and secure a viable source of income. She noted she would consider the granting of her real estate license a privilege. At the time of the June 2016, hearing, Petitioner worked for Ginny Dare Faint and offered her as a character witness. Faint testified that Petitioner was an “amazing woman” who had worked for her for one year and had “potential.” Faint indicated that Petitioner worked as a personal assistant at her beauty clinic and that she trusted her. Faint noted that she had had a real estate license for ten years and thought that Petitioner should be able to obtain one. At the June 2016 hearing Allison Baker Weiss also testified as a character witness. She indicated that she had been in real estate for many years in New York. Weiss commented that she has “loved” Petitioner right away for her drive. Weiss noted that she trusted Petitioner “with my life.” At the hearing, the Department offered the testimony of its investigator James Ledwith. Ledwith testified that the decision to deny Petitioner’s license application was based on her prior convictions which included fraud. He said the Department did not look at outcomes after a guilty plea and that the evidence Petitioner herself disclosed on her license application showed that she lacked the moral character to be a real estate salesperson. Following the June 2016 hearing, on June 20, 2016, Petitioner submitted a letter from C. Dale Hillard, designated broker, in support of her request for a provisional license: Hillard’s letter stated: I have had several discussions with Ms. Heather Joyce, and I am aware of the DUI violation in October 2011 (charges; V23578 count 2 & 5). I have copies of court records stating that charges were dismissed in San Diego, California.

She also informed me of the fraud charge on April 2, 2013 (charge: PC550 (B) (1)) that was reduced to a misdemeanor and 2 years unsupervised probation. Insurance fraud was dismissed on April 2015 per copies of court paper documentation.

I herein agree and submit my sworn statement to be a practice monitor for Ms. Joyce. I acknowledge the need for monitoring the agent's real estate activities and filing a quarterly report with the AZ Department of Real Estate and will so comply.

On June 21, 2016, the Department filed an opposition to Petitioner’s provisional license request and filed Exhibit 8, an email dated June 21, 2016 from Faint as newly discovered evidence. Faint’s email stated: Good morning. I am writing to you today to ask that my recommendation for this candidate be removed in it's [sic] entirety. Although my testimony was honest at that time, I now have additional information that causes me great concern about Heather Joyce's ethics and her current mental health. This is a very difficult thing for me to do but as a healthcare professional and a responsible member of the public I feel I must provide you with this information so that you may make a well informed decision about her suitability for a real estate license.

To summarize recent events I will say that I observed Ms. Joyce under the influence of drugs and alcohol, in fact she apologized the next day and gave me her valium pills to hold “so this doesn't happen again”. She was hysterical that night and it continued the following day as she made unreasonable demands, screamed at me hysterically, broke things, and also stole items from my mother's home. She had driven me to Boulder [C]ity to clear out my deceased mother's things but then she got so hysterical and out of control that she actually left me there, 300 miles from home, with no transportation to get back to Phoenix. I feel that no reasonable, responsible person would do such a thing! I have been her advisor and her mentor and although I do believe she has a good heart it is my opinion that she needs mental help and I pray that she gets it. I will not tolerate this kind of behavior so sadly, I have cut all ties with her.

Ms. Joyce has called my business associates, my daughter (who she never even met) spreading lies about me and upsetting them all, especially my daughter. She actually called my sister (whom she has never met or talked to before) and demanded money saying that I owe her and won't pay her. This is 100% untrue. I am sure she is the one who vandalized my clinic and I believe she also took client files out of my clinic which is a HIPPA violation. This is being investigated. The doctor she worked for, for 3 weeks, also phoned me to tell me that I may want to have my name removed from her resume as she has committed similar offenses to him and his practice. He is calling his lawyer and we may press charges if we can gather enough evidence.

A further hearing was to address this newly discovered evidence was set for and convened on August 22, 2016. Neither Faint nor Hillard appeared at the further hearing. The parties stipulated that the Tribunal could assume that Hillard knew what had transpired and still agreed to serve as Petitioner’s practice monitor if she received a provisional license. Jonina Olson Wolfe testified that in her experience Faint was “erratic” and “weird.” Olson stated that when she assisted Faint, Faint had a tendency to change what she wanted and then not pay for work done. Olson indicated she was at Faint’s house with Faint and Petitioner on the day they left for Boulder City, Nevada to clean out Faint’s mother’s house. Olson noted that she felt Faint did not treat Petitioner well on the trip and that after Petitioner called her crying on June 10, 2016, Olson decided to cut ties with Faint. Olson opined that Faint “uses” people and owes Petitioner money. Petitioner testified that Faint is a manipulator and that the email Faint sent to the Department was “all lies” concocted after Petitioner filed a small claims court case against Faint on June 20, 2016. Petitioner denied taking valium and said she did not know why she had a bottle of unidentified prescribed pills from 2013 in her toiletry bag she brought along to Boulder City. Petitioner indicated that she only takes medication for ADHD and gets a drug test monthly. Petitioner denied vandalizing Faint’s clinic. Petitioner again requested that she be granted a provisional license, noting she had put her heart and soul into obtaining her real estate salesperson’s license. CONCLUSIONS OF LAW 1. The Commissioner has jurisdiction over the subject matter in this case. Pursuant to A.R.S. § 41-1092.07(G)(2) and A.A.C. R2-19-119(B), the Petitioner has the burden of proof in this matter. The standard of proof is by a preponderance of the evidence. See A.A.C. R2-19-119(A). 2. A preponderance of the evidence is “such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). It is “[e]vidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary 1182 (6th ed. 1990). 3. A.R.S. § 32-2153 provides 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 if it appears that the holder or 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. * * * 5. Been guilty of any conduct, whether of the same or a different character than specified in this section, which constitutes fraud or dishonest dealings. * * * 7. Not shown that the holder or applicant is a person of honesty, truthfulness and good character. * * * 10. Violated any federal or state law, regulation or rule that relates to real estate or securities or that involves forgery, theft, extortion, fraud, substantial misrepresentation, dishonest dealings or violence against another person or failure to deal fairly with any party to a transaction that materially and adversely affected the transaction. This paragraph applies equally to violations of which the licensee was convicted in any lawful federal or state tribunal and to any admissions made in any settlement agreement by the licensee to violations.

4. The Department’s concern in this case is understandable and warranted. A person with a criminal record must be given close scrutiny and careful consideration when she applies for a professional license. This is particular true in this case because the record reflects that Petitioner was convicted of misdemeanor insurance fraud, a crime indicative of both fraud, dishonest dealings and poor moral character. The fact that Petitioner claims she was not aware of the statement she gave does not change the analysis and is an argument more appropriately made earlier in another forum before Petitioner pled guilty to the fraud charge. Add to this that Petitioner has also been convicted of DUI, criminal damage and domestic violence and there is ample reason to be wary of granting Petitioner a real estate salesperson’s license. Once good character is shown as absent, it is not automatically regained by the mere passage of time. The conviction of multiple crimes is not a permanent bar to being licensed. However, the Petitioner has the burden of proving by the preponderance of the evidence that she has resolved the issues that led to the commission of the above crimes to establish that she has sufficient good character and reputation to satisfy the statutory requirement for licensure as a real estate salesperson. Petitioner failed to meet this burden. It is apparent that questions remain regarding Petitioner’s stability and character as exemplified by the email from Faint. On this record, there is ample reason for the Department to exercise its discretion to deny Petitioner’s application. RECOMMENDED ORDER Based on the foregoing, it is recommended that Petitioner’s application for a real estate salesperson’s license be denied. 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 shall be five days from the date of the certification.

Done this day, August 26, 2016.

/s/ Suzanne Marwil Administrative Law Judge

Transmitted electronically to:

Judy Lowe, Commissioner Arizona Department of Real Estate

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