ALJDEC decisions subject to certification as final
20F-104-REL · Department of Real Estate · 2020-06-17
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
In the Matter of the Real Estate License of:
MANUEL O. ZAPATA, holder of License No. SA656480000,
Respondent.
No. 20F-104-REL
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: May 28, 2020
APPEARANCES: Licensee Manuel O. Zapata failed to appear. The Arizona Department of Real Estate (Department) was represented by Assistant Attorney General Lynette Evans.
ADMINISTRATIVE LAW JUDGE: Kay A. Abramsohn
_____________________________________________________________________
FINDINGS OF FACT
Since January 15, 2015, Respondent holds Real Estate Salesperson License SA656480000; the license is set to expire on January 31, 2021. According to the public record, as Respondent is not known to be currently employed and under the supervision of a designated broker, Respondent’s license is inactive.
On April 30, 2019, Respondent began employment with Superlative Realty (Superlative). Jon Greenlee was the designated Broker for Superlative.
On June16, 2019, Mr. Greenlee contacted the Department, filing a complaint regarding Respondent having allegedly misappropriated earnest deposits two times within the last 30 days. See Exhibit 2. Mr. Greenlee terminated Respondent’s employment on June 13, 2019.
Upon investigation by the Department, including an interview with Mr. Greenlee, the Department determined that Respondent had solicited cash payments under various guises from clients of Superlative and subsequently failed to so use the funds or to provide a refund to the clients, as follows:
Roel and Maria Valenzuela gave an earnest money deposit of $1500.00 to Respondent for a property they were going to purchase. Respondent, who was not authorized to accept cash payments for Superlative, failed to give the money to Superlative or a title company, and he spent the money. Additionally, Respondent failed to generate a copy of a property contract or a property file to Superlative and advised Mr. Greenlee that it had been an “off-market” transaction.
Thomas Chester gave a check for $750.00 to Respondent who had informed Mr. Chester that Superlative had “promotion” going on through which that money would be doubled at the time of the closing. The “payable to” line had been left blank as Respondent told Mr. Chester that the broker would fill that in; however, the check was subsequently negotiated payable to Respondent.
Ismael Gonzales gave a $50.00 money order and a $350.00 money order to Respondent who had informed Mr. Gonzales that the money orders were going to be used for a termite inspection ($50.00) and a home inspection ($350.00). After telling Mr. Gonzales that the inspections were complete, Mr. Gonzales was informed by the lender that the reports had not been received. Respondent used his own credit card to pay for the home inspection.
George Bustillos was advised by Respondent that realtors were able to help fix credit card debt and Mr. Bustillos paid $500.00 to Respondent for that purpose; Respondent refused to provide a receipt for the money. When he discovered that the credit issue had not been cleared up, Mr. Bustillos was unable to reach Respondent despite multiple efforts regarding a recovery of the $500.00.
As to the investigated clients and the monies misappropriated by Respondent, Mr. Greenlee has made the clients whole.
On June 28, 2019, the Department noticed Respondent by certified mail at his address of record regarding the complaint and requested a response. The postal service returned the notice with a postal label indicating the mail was “not deliverable as addressed” and “unable to forward.”
The Department proceeded to contact Respondent’s employer at that time, who provided an address for Respondent that was not an address on file with the Department.
On August 13, 2019, the Department noticed Respondent by certified mail at the provided address regarding the complaint and requested a response.
On August 14, 2019, the Department’s Investigator was able to contact Respondent by phone and specifically requested that Respondent file a written response to the complaint along with any supporting documents.
To date, Respondent has neither updated his address with the Department nor provided a written response to the complaint to the Department.
On March 3, 2020, the Department issued its Notice of Hearing and Complaint (Notice) by certified mail to Respondent at two addresses and by electronic mail (email). The Notice specified that hearing would take place on April 23, 2020.
Through the Department, by email, Respondent requested a continuance, indicating he was “not feeling well and wanting to see a doctor.”
By Minute Entry dated April 1, 2020, the hearing in this matter was rescheduled for May 28, 2020 at 1:00 p.m. A subsequent ORDER was issued setting the matter for a telephonic hearing and advising Respondent to provide a telephone contact number. Neither of those documents was returned to the Tribunal for a bad address; both documents had also been emailed to Respondent.
At the time of the hearing, Respondent failed to appear; he had not provided a phone number and he did not call in at the time of the hearing or at any time during the duration of hearing which was conducted over a period of one and one-half hours.
The Department’s position is that Respondent is in violation of applicable statue and rule, as noticed:
through his acts and conduct of misrepresentation and false promises;
through failing to respond to the Department in the course of an investigation,; and
through failing to notify the Department in writing within 10 days of any change in personal information or qualifications.
The Department argued that the evidence demonstrated that Respondent, on four occasions, violated the trust of clients and ignored the professional responsibility that departmental licensure carries, by making false promises and by misappropriating the monies he had obtained from them. The Department’s position is that there are multiple grounds on which to revoke Respondent’s license and that anything short of revocation would not be suitable in order to protect the public from such acts and conduct by Respondent. The Department requests that Respondent’s license be revoked.
CONCLUSIONS OF LAW
The Department bears the responsibility to protect the public through its enforcement of licensing statutes. This matter lies within its jurisdiction.
The Department bears the burden of proof to establish cause to discipline Respondent’s license and any factors in aggravation of any penalty to be imposed by a preponderance of the evidence. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” 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.”
A.R.S. § 32-2153 provides as follows:
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:
Pursued a course of misrepresentation or made false promises ..., whether acting in the role of a licensee or a principal in a transaction.
...
3. Disregarded or violated any of the provisions of this chapter or any rules adopted by the commissioner.
...
9. Failed, within a reasonable time, to account for or to remit any monies ...
...
15. Failed to keep an escrow or trust account or other record of funds deposited with a licensee related to a real estate transaction.
...
17. Failed or refused upon demand to produce any document, contract, book, record, information, compilation or report that is in the licensee’s possession or that the licensee is required by law to maintain concerning any real estate ... activities or transactions involving or conducted by the licensee for inspection by the commissioner or the commissioner’s representative.
B. The commissioner may suspend or revoke a license . . . issued under this chapter when it appears that the holder . . . has:
. . . .
3. Made any substantial misrepresentation.
...
4. Made any false promised of a character likely to influence, persuade or induce.
...
11. Failed to respond in the course of an investigation or audit by providing documents or written statements.
A.A.C. R4-28-303(D)(3) requires that licensees shall, within 10 days, notify the commissioner regarding changes in personal information or qualifications.
The hearing record established that Respondent performed that acts and the conduct stated in the complaint and as investigated. The Department thereby established cause to discipline Respondent’s real estate licensure under A.R.S. § 32-2153(A) and (B) and A.A.C. R4-28-303.
The Department is charged with protecting the public and consumers who deal with licensees. The Department’s concern in this case is understandable in that Respondent made false promises and mispresented the purpose of and use for monies obtained from the four named clients. Further, Respondent’s actions in failing to update the Department as to his personal information and in ignoring the Department’s investigation is troubling, resulting in the Department’s concern as to whether Respondent is able to be regulated.
Based on the hearing record, the Administrative Law Judge concludes that the Department’s determination to revoke Respondent’s license is appropriate as disciplinary action based on this licensee’s actions and failures to act. Based on the evidence, the Administrative Law Judge concludes that Respondent’s license should be revoked.
RECOMMENDED ORDER
The Commissioner shall revoke Respondent’s License SA656480000.
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, June 17, 2020.
/s/ Kay Abramsohn
Administrative Law Judge
Transmitted electronically to:
Judy Lowe, Commissioner
Arizona Department of Real Estate