ALJDEC decisions subject to certification as final

19F-296-REL · Department of Real Estate · 2019-08-19

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 2, 2019, at 1:00 p.m. APPEARANCES: The Arizona Department of Real Estate (“the Department”) was represented by Deian Ousounov, Esq., Assistant Attorney General; Ronald Brown (“Respondent”) failed to appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Procedural Background 1. The Department is the duly constituted authority for licensing and regulating real estate salespersons and brokers in Arizona. 2. On or about May 16, 2011, the Department issued Real Estate Salesperson License No. SA639512000 to Respondent. That license expired on May 31, 2019.[1] 3. On or about June 18, 2019, the Department issued a Notice of Hearing and Complaint, alleging certain misconduct by Respondent and charging cause to discipline his salesperson’s license under A.R.S. §§ 32-2153(A)(3), 32-2153(B)(2), 32-2153(B)(7), and A.A.C. R4-28-303(D). 4. The Department’s Notice of Hearing and Complaint also set an evidentiary hearing before the Office of Administrative Hearings (“OAH”), an independent state agency, on August 2, 2019, at 1:00 p.m. The Department mailed the Notice of Hearing and Complaint via first class and registered mail to Respondent at his residential address of record and at the correctional facility to which he had been sentenced. 5. On or about July 29, 2019, Respondent sent a letter to the Attorney General’s Office and to the assigned Administrative Law Judge at OAH, stating that he would not attend the scheduled hearing. 6. On August 2, 2019, a hearing was held. The Department submitted six exhibits and presented the testimony of its Senior Investigator, Bret Biesenthal. 7. Respondent did not request to appear telephonically at the hearing or that the hearing be continued. Respondent did not appear, personally or through an attorney. Consequently, Respondent did not present any evidence to defend his real estate salesperson’s license. Hearing Evidence 8. According to the Department’s records, Respondent was employed as a salesperson by Keller Williams Realty Biltmore Partners on or about October 30, 2018.[2] 9. On or about February 27, 2018, a direct complaint was issued against Respondent in Maricopa County Superior Court Case Nos. CR2018-109949-001 DT, CR2018-109949-002 DT, CR2018-109949-003 DT, and CR2018-209949-004 DT, charging Respondent with one count of conspiracy, one count of illegally conducting an enterprise, four counts of possession of dangerous drugs for sale in an amount over the statutory threshold, and one count of money laundering.[3] 10. Mr. Biesenthal testified that since 2017, the Phoenix Drug Enforcement Agency had been investigating Respondent’s and others’ drug trafficking activities to manufacture and distribute the drug MDMA. Respondent was a major contributor to the enterprise and used his job at Sky Harbor airport in Phoenix to smuggle drugs on planes to other cities in the United States. Mr. Biesenthal testified that the charges resulted from DEA agents’ raids of the homes of persons who were involved in the enterprise. After the raids occurred, Respondent attempted to leave the country and had a ticket on a flight to Cancun.[4] 11. Mr. Biesenthal explained that the Department was concerned about Respondent’s activities because he was part of a criminal organization and had participated distributing massive amounts of narcotics throughout the county. 12. On or about November 6, 2018, Respondent was convicted of attempted possession of dangerous drugs for sale, a class 3 felony, pursuant to his guilty plea in Case No. CR2018-109949- 002 DT.[5] 13. On or about January 11, 2019, Respondent was sentenced a minimum term of 2.5 years in prison under the custody of the Arizona Department of Corrections pursuant to his guilty plea.[6] 14. At the time of the hearing, Respondent was incarcerated at Marana prison.[7] 15. Mr. Biesenthal testified that Respondent did not report his criminal conviction to the Department. 16. Mr. Biesenthal stated that under the Department’s statutes, it cannot issue or renew the license of a person that is serving time for a felony conviction. 17. On February 22, 2019, the Department summarily suspended Respondent’s salesperson’s license under A.R.S. §§ 32-2153 and 32-2157, finding that the public health, safety, and welfare required emergency action.[8] Respondent did not request a hearing on the summary suspension. CONCLUSIONS OF LAW The Notice of Hearing that the Department mailed to Respondent at his residential address of record and at the Arizona Department of Corrections’ facility where he is currently incarcerated was reasonable and it appears that Respondent actually received notice of the hearing.[9] Pursuant to A.R.S. § 32-2153(E), the lapsing or suspension of a license by operation of law or by order or decision of the Commissioner or a court of law or the voluntary surrender of a license by a licensee shall not deprive the Commissioner of the jurisdiction to proceed with any investigation of or action or disciplinary proceeding against the licensee. The Department has jurisdiction over Respondent and the subject matter in this case.[10] The Department bears the burden of proof to establish cause to discipline Respondent’s license and factors in aggravation of any penalty to be imposed by a preponderance of the evidence.[11] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[12] A.R.S. § 32-2153 provides as follows: 32-2153. Grounds for denial, suspension or revocation of licenses . . . .

A. The commissioner may suspend or revoke a license . . . issued under this chapter if it appears that the holder . . . , within five years immediately preceding, in the performance of or attempt to perform any acts authorized by the license or by this chapter, has: . . . . 3. Disregarded or violated any of the provisions of this chapter or any rules adopted by the commissioner. . . . .

B. The commissioner may suspend or revoke a license . . . issued under this chapter when it appears that the holder . . . 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. . . . .

7. Not shown that the holder or applicant is a person of honesty, truthfulness and good character.

A.A.C. R4-28-303(D) provides in relevant part as follows, “A salesperson or broker shall notify the Department in writing within 10 days of any change in the individual’s personal information or qualifications. . . .” The Department established that Respondent was convicted of attempted possession of dangerous drugs for sale, a felony, and that he failed to report the conviction to the Department. The Department thereby established cause to discipline Respondent’s salesperson’s license under A.R.S. §§ 32-2153(A)(3), 32-2153(B)(2), 32-2153(B)(7), and A.A.C. R4-28- 303(D). Respondent’s serious violations and failure to appear for the duly noticed hearing indicate that at this time, he cannot be regulated. RECOMMENDED ORDER In view of the foregoing, IT IS ORDERED affirming the summary suspension of Respondent Ronald E. Brown’s Real Estate Salesperson’s License Number SA639512000. IT IS FURTHER ORDERED revoking Respondent Ronald E. Brown’s Real Estate Salesperson’s License Number SA639512000. 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 19, 2019.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

Judy Lowe, Commissioner Arizona Department of Real Estate ----------------------- [1] See the Department’s Exhibit 1. [2] See Exhibit 1. [3] See Exhibit 2 at 1-5. [4] See Exhibit 2 at 6-8. [5] See Exhibit 3 at 1-2. [6] See Exhibit 4 at 1-3. [7] See Exhibit 5. [8] See Exhibit 6. [9] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [10] See A.R.S. § 32-2153. [11] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [12] Morris K. Udall, Arizona Law of Evidence § 5 (1960).

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Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826