ALJDEC decisions subject to certification as final

20F-153-REL · Department of Real Estate · 2020-02-04

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

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

VALIANT, JASON, aka CORRALES, JASON, holder of license number SA672789000 (Candidate),

Petitioner.

No. 20F-153-REL

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: January 15, 2020 at 1:00 PM.

APPEARANCES: Robert Bass, Esq. appeared on behalf of Jason Valiant (“Petitioner”) with Todd Menard, Guillermo Rivas, and Marcia Corrales as witnesses. Assistant Attorney General Deian Ousounov, Esq. appeared on behalf of the Arizona Department of Real Estate (“Department”) with Linda Bevins as a witness. Roger Corrales and Angela Corrales observed.

ADMINISTRATIVE LAW JUDGE: Jenna Clark.

_____________________________________________________________________

After review of the hearing record in this matter, the undersigned Administrative Law Judge makes the following Findings of Fact and Conclusions of Law, and issues this Recommended Order to the Commissioner of the Department.

FINDINGS OF FACT

Background and Procedure

On or about December 19, 2006, the Superior Court of Florida, Seminole County, adjudged Petitioner guilty and convicted him of 2 counts of Leave Scene of Accident with Property Damage, misdemeanors of the second degree, per Petitioner’s nolo contendere pleas. Petitioner was placed on supervised probation for 6 months. Petitioner was also fined a total of $973.00 and ordered to pay restitution.

On or about June 22, 2012, the Superior Court of Florida, Lake County, withheld adjudication of guilt against Petitioner, per Petitioner’s nolo contendere pleas, for Petit Shoplifting from a Merchant, a second degree misdemeanor, and Resist of an Officer – Obstruction without Violence, a misdemeanor of the first degree, and placed him on supervised probation for 6 months. Petitioner was fined a total of $340.00, ordered to complete a 4 hour course, and ordered to participate in 25 hours of community service.

On or about April 26, 2013, the Circuit Court of the Eighteenth Judicial Circuit, in and for Brevard County, Florida, withheld adjudication of guilt against Petitioner, per Petitioner’s nolo contendere pleas, for Fraudulent Use of Personal Identification Information, a felony in the third degree; Fraudulent Use of Credit Cards $100 or Less, a misdemeanor in the first degree; and Petit Theft Less Than $300 Dollars, a misdemeanor in the second degree. Petitioner was sentenced to 180 days in jail with credit for 130 days served, and placed on supervised probation for 2 years. Petitioner was fined a total of $868.20 and ordered to pay restitution.

On or about June 17, 2014, the Superior Court of Florida, Seminole County, adjudged Petitioner guilty and convicted him, per Petitioner’s nolo contendere pleas, of Driving Under the Influence with One Prior, a misdemeanor of the first degree; Refusal to Give Breath, Urine or Blood Test, a misdemeanor in the first degree; and Driving While License Cancelled, Suspended or Revoked, a misdemeanor in the second degree. Petitioner was sentenced to 12 months supervised probation, his driver’s license was suspended for 6 months, he was ordered to complete Advanced Counter Attack School, and ordered to participate in a Victim Awareness Program. Petitioner was fined a total of $1,566.00.

On or about July 28, 2014, the Superior Court of Florida, Seminole County, adjudged Petitioner guilty and convicted him, per Petitioner’s nolo contendere plea, of Driving Under the Influence with One Prior, a misdemeanor of the first degree. Petitioner was sentenced to 10 days in jail with credit for time served, and placed on supervised probation for 11 months and 20 days. Petitioner was required to participate in a Victim Awareness Program, and had an interlock device placed inside his vehicle. Petitioner was fined a total of $1,516.00.

On or about October 07, 2019, Petitioner submitted an application for a Real Estate Salesperson License to the Department.

Petitioner answered “Yes” to questions #1, #2, #4, #5, #7, #12, and #13 of the Background Questions section of the application, which ask:

1) Have you ever had a professional license or registration of ANY kind denied, suspended, restricted, or revoked?

2) Have you ever had/have an administrative order and/or ANY other disciplinary action taken against ANY license issued to them by any local, state, or federal regulatory agency including the Arizona Department of Real Estate?

* * * *

4) Have you ever voluntarily surrendered ANY professional or occupational license during the course of an investigation or disciplinary proceeding?

5) Have you ever entered into ANY consent decree, and/or had an injunction (either temporary or permanent), a suspension, an order and/or a judgment issued which prohibited or restricted them from engaging in ANY profession or occupation?

* * * *

7) Have you ever had any judgment and/or order entered against them by ANY court arising out of the conduct of any business in real estate, cemetery property, timeshare intervals, or membership campgrounds?

* * * *

12) Have you ever been convicted and/or entered into a plea agreement and/or a 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 had been pardoned?

13) Have you ever 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, judgment or sentencing was deferred, the conviction was dismissed or expunged, or had been pardoned?

CONVICTIONS – DUI AND/OR RECKLESS DRIVING, EITHER MISDEMEANOR OR FELONY, MUST BE DISCLOSED.

Minor traffic citations do not constitute a misdemeanor or felony offense.

On or about November 07, 2019, the Department mailed Petitioner notification of its intent to deny his application.

On or about November 20, 2019, the Department received a timely appeal from Petitioner regarding the denial of his licensure application.

The Department referred the matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing to determine whether grounds exist for the Department to deny Petitioner’s original application for a Real Estate Salesperson’s License.

On December 10, 2019, the Department issued a Notice of Hearing which scheduled a hearing for January 15, 2020, at 1:00 p.m.

Hearing Evidence

The Department submitted 26 exhibits and presented the testimony of investigator Linda Bevins (“Investigator Bevins”). Petitioner submitted 1 exhibit and testified on his own behalf. Petitioner called his mother Marcia Corrales, and acquaintances Todd Menard and Guillermo Rivas as witnesses. The pertinent facts are as follows:

Investigator Bevins’ testimony

Investigator Bevins testified that Petitioner previously applied for a Real Estate Salesperson License from the Department on or about September 08, 2017, which was denied by the Department. Petitioner did not appeal that denial.

Petitioner’s “yes” responses to his October 08 2019, application, and subsequent written explanations regarding those responses, triggered the Department’s investigation of Petitioner.

On or about May 03, 2017, the Florida Department of Business & Professional Regulation – Division of Real Estate (“Florida DRE”) notified Petitioner, based on information received from the Florida Department of Revenue, that his Florida Real Estate Salesperson License was suspended.

The Florida DRE opened an investigation which resulted in a determination that Petitioner had committed 4 statutory violations: (1) a violation of any rule or lawful order pursuant to Fl. Rev. Stat. § 32-475.25(1)(e); (2) a plea of nolo contendere/conviction of a crime related to the activities of a licensed sales associate involving moral turpitude, fraud, or dishonest dealings pursuant to Fl. Rev. Stat. § 32-475.25(1)(f); (3) failure to inform DRE in writing within 30 days after pleading nolo contendere or being found guilty of any felony pursuant to Fl. Rev. Stat. § 32-475.25(1)(p); and (4) a violation of any standard of professional practice.

On or about September 27, 2017, Petitioner entered into a Settlement Agreement with the Florida DRE to voluntarily surrender his Florida Real Estate Salesperson License. The Final Order was executed on or about September 04, 2018.

In reviewing the related police reports underlying the Florida DRE’s determination(s), the Department took the position that some, if not all, of Petitioner’s statements to law enforcement regarding his conduct and beliefs at that time were either in direct conflict or varied greatly from related statements he had provided to the Department.

On or about February 05, 2019, pursuant to a received complaint, the Department issued a Cease & Desist order to Petitioner which directed him to stop engaging in unlicensed real estate activity. During a June 07, 2019, Informal Settlement Conference, Petitioner provided sufficient evidence to the Department to compel it to vacate the Cease & Desist order, including evidence to establish that his ex-wife/ex-business partner had filed the underlying unfounded and retaliatory complaint against Petitioner. Petitioner denied any wrongdoing and agreed that he would not engage in unlicensed real estate activity in the future. As a result, on June 24, 2019, Petitioner and the Department entered into a Consent Order memorializing Petitioner’s agreement.

Petitioner was neither advised by the Department of any perceived inconsistencies in his real estate salesperson’s license application, nor was he afforded an opportunity to provide additional information to the Department.

Ultimately, the Department declined to issue a Real Estate Salesperson’s License to Petitioner due to concerns regarding Petitioner’s prior criminal record, Petitioner’s perceived unwillingness to be accountable for the underlying related criminal conduct, the time between Petitioner’s most recent criminal conduct and his license application, and the Department’s belief that Petitioner exhibited a pattern of untruthfulness during the Department’s investigation.

Todd Menard’s testimony

Mr. Menard testified that he is the Chief Operating Officer for West USA Realty, Inc. located in Phoenix, Arizona. He has been in the role for the last 7 years.

Mr. Menard is privy to some of Petitioner’s criminal record, including Petitioner’s fraud conviction, but not the entirety of it. Nonetheless, Mr. Menard would consider employing Petitioner as a realtor if Petitioner possessed a valid real estate salesperson license.

Mr. Menard affirmed that he would serve as Petitioner’s Practice Monitor if the Department issued Petitioner a Provisional License. Mr. Menard is familiar with all of the requirements involved with being a Practice Monitor because he formerly served as one at his prior real estate firm. Mr. Menard is not West USA Realty’s Designated Broker. However, that individual relies on Mr. Menard’s counsel and advice, and would agree to hire Petitioner.

Mr. Menard believes that Petitioner would be a welcome addition to his firm and the practice of real estate, but agreed to ultimately differ to the Department regarding Petitioner’s fitness.

Guillermo Rivas’ testimony

Mr. Rivas testified that he is a local business owner who has been acquainted with Petitioner for the last 4 years.

Mr. Rivas would like to get into “flipping” houses, and would like for Petitioner to be his business partner.

Mr. Rivas is “somewhat familiar” with Petitioner’s criminal record and has no misgivings about getting into business with Petitioner because he thinks Petitioner is honest, professional, and passionate about his work in real estate.

Petitioner’s testimony

Petitioner was born in early-August 1979.

Petitioner obtained his Real Estate Salesperson License in Florida on August 16, 2002.

Per Petitioner, when he moved from Florida to Arizona in mid-2017 he changed his last name from Corrales to Valiant to signify the challenges he overcame in his past and serve as a constant reminder to uphold his core values.

Petitioner does not dispute the contents or validity of any police report admitted into evidence by the Department.

Regarding the criminal convictions disclosed in Petitioner’s application to the Department, Petitioner testified:

Petitioner admitted that he left the scene of an accident after unsuccessfully offering financial compensation to the other involved driver.

Petitioner’s wife shoplifted at a local drug store unbeknownst to him. Petitioner took the blame because he did not want his wife to be jailed away from her minor children. It was at this time Petitioner discovered that his wife had a “problem with pills.”

Petitioner’s wife used Petitioner’s client’s credit card without consent to pay for the couple’s utility bill. Petitioner took the blame because he failed to properly secure the card, and the underlying utility account was in his name.

After Petitioner got a divorced from his wife, lost custody of his son, and lost his house he fell into a depression and bought a “bag of painkillers and sleeping pills.” He was on probation at the time. After taking the entire bag of pills Petitioner drove and swerved his vehicle into oncoming traffic, resulting in a (aggravated) DUI conviction.

The mother of Petitioner’s son sued him for child support which resulted in the suspension of his real estate license after he fell into arrears. After his son’s mother failed to bring the child to a court-ordered visit with Petitioner, Petitioner consumed alcohol at a local bar and fell asleep in his car afterward. Because he had been legally intoxicated with the car keys in the ignition, Petitioner was charged with his second (aggravated) DUI a month after being charged with his first DUI.

Petitioner testified that he satisfied all related probationary terms of his convictions, including payment of all fines and completion of court-ordered programs. However, Petitioner’s court-ordered interlock system must remain installed in his vehicle until 2024.

Petitioner admitted that he did not notify Florida DRE about any of his criminal charges or convictions because he was afraid of having his license revoked.

On or about October 03, 2019, Petitioner’s driver’s license was reinstated.

Petitioner remains an active participant in Alcoholics Anonymous on his own accord.

Petitioner concluded by requesting that he be issued a Provisional Real Estate Salesperson’s License, and argued that he was deserving because he had demonstrated reformation, penance, and a genuine desire to work in real estate and move forward with his life.

CONCLUSIONS OF LAW

Because at all times relevant to this matter Respondent was subject to the provisions of Title 32, Chapter 20, Arizona Revised Statutes, the Commissioner of the Department has jurisdiction over Respondent and the subject matter in this case.

The case was properly brought before the Office of Administrative Hearings for adjudication pursuant to Title 2, Chapter 19, Article 1, of the Arizona Administrative Code.

Petitioner bears the burden of proof to establish that he is rehabilitated and qualified to receive an insurance license. The standard of proof on all issues in this matter is that of 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).

Ariz. Rev. Stat. § 32-2153(B) provides, in pertinent parts, as follows:

The commissioner may deny the issuance of a license 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.

* * *

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

* * *

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

The legislature has charged the Department with protecting the public and consumers who deal with licensed salespersons when it issues licenses. Therefore, Department has discretion to deny the issuance of a license under Ariz. Rev. Stat. § 32-2153(B) as a real estate salesperson’s license is a privilege, not a right.

The issue in this case is whether grounds exist for the Department to deny Petitioner’s application for a Real Estate Salesperson’s License given Petitioner’s criminal history and underlying related conduct. The crux being whether Petitioner has established that he can be trusted at this time to be responsible in his dealings with competitors and the public overall if the Department grants his request.

The material facts in this matter are not in dispute.

Pursuant to the above-captioned statute(s), the Commissioner of the Department is entitled to deny licensure to any applicant that has been lawfully convicted of a felony offense. The credible evidence of record establishes that less than 10 years ago Petitioner was convicted of a felony involving theft, forgery, and/or a crime of moral turpitude or like offense by a court of competent jurisdiction, in violation of Ariz. Rev. Stat. § 32-2153(B)(2).

The time period required for a license applicant to establish rehabilitation is commensurate with the period of misconduct and the severity of the offenses. The record also reflects multiple instances in the 7 years preceding Petitioner’s application for licensure wherein Petitioner violated the terms of his probation and incurred additional criminal convictions, in violation of Ariz. Rev. Stat. § 32-2153(B)(9).

The definition of what constitutes good character, or a lack thereof, is not codified by the legislature. Former United States Supreme Court Justice Frankfurter noted, “No doubt satisfaction of the requirement of moral character involves an exercise of delicate judgment on the part of those who reach a conclusion.” However, because the record also evinces Petitioner’s inability or unwillingness to objectively perceive and recount the truth, a violation of Ariz. Rev. Stat. § 32-2153(B)(7) has also been established.

After closely scrutinizing the underlying conduct which resulted in Petitioner’s criminal convictions, as well as the convictions themselves, the Tribunal holds that the evidence of record establishes that grounds exist for the Department to deny issuance of a real estate salesperson license to Petitioner, as it is unclear whether Petitioner may be regulated by the Department at this time.

While the tribunal applauds Petitioner for attempting to secure gainful employment, Petitioner provided no binding authority or statute under which the tribunal or Department would be bound to accept and approve his application for licensure at this time.

Based on the relevant and credible evidence in the record, the undersigned Administrative Law Judge holds that Petitioner has not sustained his burden of proof in this matter by a preponderance of the evidence.

RECOMMENDED ORDER

Based upon the foregoing,

IT IS RECOMMENDED that Petitioner’s appeal be denied.

IT IS FURTHER RECOMMENDED that the Commissioner affirm the Department’s determination to deny Petitioner’s application for a Real Estate Salesperson License pursuant to Ariz. Rev. Stat. § 32-2153(B).

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 (5) days from the date of that certification.

Done this day, February 04, 2020.

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Judy Lowe, Commissioner

Arizona Department of Real Estate