ALJDEC decisions subject to certification as final

18F-DI-204-REL · Department of Real Estate · 2018-05-30

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of the Renewal Application for Real Estate Salesperson License of:

GNEWUCH (formerly JONES), JESSICA, candidate of license number SA559649000, PETITIONER.

No. 18F-DI-204-REL

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: May 15, 2018 at 1:00 PM.

APPEARANCES: Jessica Gnewuch (“Petitioner”) appeared on her own behalf. Ryan Krench, Esq., Assistant Attorney General appeared on behalf of the Arizona Department of Real Estate (“the Department” or “Respondent”), with Brandon Stuart as his witness.

ADMINISTRATIVE LAW JUDGE: Jenna Clark.

_____________________________________________________________________

Having heard the evidence and testimony and having considered the record in this matter, the undersigned Administrative Law Judge hereby makes the following Findings of Fact and Conclusions of Law and issues the following Recommended Decision to the Commissioner of the Department.

FINDINGS OF FACT

Procedure and Background

Per the Notice of Hearing, the Department referred this matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing on May 09, 2018, to determine whether the Department properly denied the renewal of Petitioner’s Real Estate Salesperson’s License No SA559649000.

The Department first issued Petitioner’s Real Estate Salesperson License No SA559649000 on March 05, 2005.

The license was terminated on March 31, 2009.

On or about July 15, 2011, Petitioner applied to reinstate her salesperson’s license.

The Department issued a denial letter to Petitioner on July 18, 2011. Petitioner appealed on August 17, 2011.

As a result of the appeal, the Department issued Petitioner a provisional salesperson’s license in a Consent Order, signed by both parties, on November 23, 2011.

The provisional license was to be in effect for two years, and Petitioner was required to adhere to several stipulations, including: completing continuing education courses, submitting sworn quarterly declarations to the Department regarding her compliance, and working under the supervision of a practice monitor for the duration of her disciplinary period.

In June of 2013, the Department sent a letter to Petitioner informing her that it had not received her quarterly report for May of 2013, which had been due on May 25, 2013. The letter further advised Petitioner that she needed to appear for a meeting on June 20, 2013.

On June 12, 2013, Petitioner’s practice monitor informed the Department of his resignation. As a result, the Department immediately changed Petitioner’s license status to “inactive” per the terms of her Consent Order.

Although, Petitioner completed her required continuing education courses, she failed to report to her June 20, 2013 meeting with the Department, and did not submit any quarterly reports after April of 2013. Petitioner did not contact the Department for an extension or inform it of any then-existing circumstances that were preventing her compliance with the Consent Order.

On July 24, 2013, the Department issued a Notice of Hearing and Complaint to Petitioner. Petitioner was required to submit an Answer within twenty days of receiving the document. Petitioner did not comply.

Though the matter was referred to the Office of Administrative Hearings for an evidentiary hearing scheduled for October 08, 2013, the matter was vacated on September 12, 2013, due to Petitioner’s failure to timely answer.

Petitioner’s Real Estate Salesperson License No SA559649000 was formally revoked on September 12, 2013.

On January 16, 2018, Petitioner submitted an application for a real estate salesperson license to the Department.

Petitioner attached a Disciplinary Actions Disclosure form to her application, whereby she admitted to having been disciplined under a previously issued license, resulting in revocation.

The discipline was a result of a February 11, 2009, Extreme DUI conviction that she failed to report to the Department. Petitioner was sentenced to ten days in jail and fined $4,800.00.

Petitioner further admitted in her Disciplinary Actions Disclosure form that she had also previously failed to adhere to a Consent Order issued by the Department, regarding the aforementioned incident, whereby the Department placed her on a provisional license for two years.

On January 24, 2018, the Department issued Petitioner a letter informing her of its intent to deny her application pursuant to Ariz. Rev. Stat. §§ 32-2123, 32-2124, and 32-2153(A)(24), (B)(8), and (B)(9).

The Department received Petitioner’s timely appeal on January 30, 2018.

Hearing Evidence

At the hearing, Petitioner testified that her failure to comply with the Consent Order was the result of her being “in over [my] head” and overwhelmed by personal issues. Specifically, Petitioner testified that she had become a new mother and had difficulties adjusting to motherhood and the needs of her newborn. Petitioner also testified that her mother had become ill, which was difficult for her to deal with. Petitioner also offered that she and her husband shared one car, which made it difficult for her to travel to her brokerage firm which was located approximately thirty miles from her home.

Petitioner noted that during the time her Consent Order had been in effect, prior to her license revocation, that she had not run any advertisements, seen any clients, or practiced at all.

Petitioner believed that she had voluntarily surrendered her real estate license, effectively ending her real estate career, in the spring of 2013.

Petitioner admitted that her failure to adhere to her Consent Order was negligent. She did not offer any justifications or excuses. Petitioner credibly opined that she felt ready to return to practice because the challenges she previously faced no longer existed, and because she had taken several requisite steps to obtain her license. Thus, Petitioner reasoned, her application should be approved.

The Department’s position was that the underlying denial should be upheld. The Department opined that because Petitioner was noncompliant while she was being closely monitored, it could not be confident that Petitioner would engage in the best interests of her clients while not being as closely monitored as before.

CONCLUSIONS OF LAW

The Commissioner of the Department has jurisdiction over Petitioner and the subject matter in this case.

This hearing was conducted in accordance with Ariz. Rev. Stat. § 41-1092.01 et seq. Petitioner has the burden of proof.

The standard of proof on all issues is by a preponderance of the evidence. A preponderance of the evidence is:

The 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.

Black’s Law Dictionary 1373 (10th ed. 2014). See also Ariz. Admin. Code R2-19-119.

Ariz. Rev. Stat. § 32-2153 provides that 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:

Violated any condition or term of a commissioner's order.

Demonstrated incompetence to perform any duty or requirement of a licensee under or arising from this chapter. For the purposes of this paragraph, "incompetence" means a lack of basic knowledge or skill appropriate to the type of license the person holds or a failure to appreciate the probable consequences of the licensee's action or inaction.

Violated the terms of any criminal or administrative order, decree or sentence.

Pursuant to Ariz. Rev. Stat. § 32-2153 the Commissioner is authorized to deny an application or renewal requests for any of the aforementioned reasons. The Department’s concerns in these areas are legitimate.

Although Petitioner credibly explained how her circumstances have changed in the past fifty-seven months, her testimony does not overcome the greater weight of the evidence in the record to compel the Department to issue her a real estate salesperson license. More is needed to assure and balance the Department’s need to regulate applicants with an applicant’s desire to better themselves through the pursuit of professional success in the real estate field.

Had the evidence in the record been different, the Tribunal might have determined that this circumstance did not fall within Ariz. Rev. Stat. §§ 32-2153(A) or 32-2153(B). For instance, while the Department may have been amenable to considering issuing Petitioner a provisional license, the hearing record provided no testimony from a licensed agent or broker who was also willing to monitor Petitioner over the course of the next several years.

Based on the evidence presented, the Administrative Law Judge must find that Petitioner did not completely sustained her burden of proof.

RECOMMENDED ORDER

Based on the foregoing,

it is recommended that the Department’s denial be upheld at this time and that Petitioner Jessica Gnewuch’s appeal 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, May 30, 2018.

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Judy Lowe, Commissioner

Arizona Department of Real Estate