ALJDEC decisions subject to certification as final

20F-384-REL · Department of Real Estate · 2020-09-14

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of the Real Estate License of:

CAPRIOTTI, JOHN, holder of License No. SA537518000,

Petitioner

No. 20F-384-REL

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: August 24, 2020

APPEARANCES: Michael T. Denious, Esq. for John Capriotti; Lynette Evans, Esq. for the Department of Real Estate

ADMINISTRATIVE LAW JUDGE: Thomas Shedden

FINDINGS OF FACT

On June 26, 2020, the Arizona Department of Real Estate (“Department”) issued a Notice of Hearing setting the above-captioned matter for hearing on August 12, 2020 at the Office of Administrative Hearings. The matter was continued and the hearing was conducted on August 24, 2020.

The issue for hearing is whether grounds exist to revoke petitioner John Capriotti’s real estate salesperson’s license.

On June 10, 2020, the Department summarily suspended Mr. Capriotti’s license because Mr. Capriotti was observed on a Ring doorbell camera leaving a house at which he had conducted a virtual showing with light bulbs that had been left in the house. Mr. Capriotti did not leave the property with the light bulbs, but rather re-entered the house and returned the light bulbs.

Mr. Capriotti has been licensed by the Department since November 2002. Mr. Capriotti has had no other complaints filed against him and has had no disciplinary action taken against him.

Mr. Capriotti works at the Daniel Montez Realty Group. Daniel Montez is the owner and his mother Susan Montez is the designated broker. Mr. Capriotti has worked with the Montezes for about ten years.

Mr. Capriotti testified on his own behalf and also presented the testimony of Mr. Montez, Traci Gratzek a licensed mortgage loan officer, and Jason Dougherty a former client and potential future client. All three of his witnesses were aware of the event that led to Mr. Capriotti’s license being suspended and each offered the opinion that this was out of character for Mr. Capriotti.

Mr. Capriotti’s testimony

Mr. Capriotti acknowledges that what he did was wrong and testified to the effect that removing the light bulbs from the house represented a lapse in judgment.

On or about April 21 or 22, 2020, Mr. Capriotti was conducting a virtual showing of a house. Although the COVID virus had hit by that time, most of Mr. Capriotti’s showings were still being conducted in person. In this case, the client lives in Florida and Mr. Capriotti had been conducting virtual showings over the course of two to three years.

Virtual showings are set up on-line and the listing agent gets a notification when a showing is scheduled. The keys are in a lock-box and the listing agent gets a notice of activation and the identity of the party accessing the house when the agent enters his code to retrieve the keys.

The house was vacant and empty of furniture and clothing, but had a refrigerator and washer and dryer.

The prospective buyer/client is thorough and the showing took twenty-five to thirty minutes. The client asked Mr. Capriotti to open the refrigerator and drawers, and to open the cabinets because he wanted to see the hinges.

The last room Mr. Capriotti entered was the laundry room; he opened the cabinets and the drawers and there were several packages of LED light bulbs in a drawer. Mr. Capriotti testified that he said “Look, they left you some light bulbs.”

The tour ended and Mr. Capriotti exited the house with a package of light bulbs. He testified that for three days his wife wanted him to get light bulbs, but it had slipped his mind, and it popped into his head that he could save some time if he took some from the house rather than stopping at a store. He did not believe that the light bulbs were abandoned, but rather that the house was vacant and the bulbs were left behind.

On exiting the house, Mr. Capriotti was thinking that he had to go to Casa Grande for his next appointment. He saw the Ring doorbell but was not sure if it worked because most of the utilities were off and his Ring doorbell requires wi-fi.

He testified that he knew it was wrong to take the light bulbs and he re-entered the house to return the light bulbs, but he acknowledged that seeing the Ring doorbell was a factor in his decision.

Mr. Capriotti had not relocked the keys into the lockbox before he returned the light bulbs.

Later that day, Mr. Montez emailed Mr. Capriotti informing him that the Montezes had a video showing him with the light bulbs and asking him to call.

Mr. Capriotti called Mr. Montez who did not respond, so he called Ms. Montez at about 6:00 or 6:30 p.m. Mr. Capriotti testified that he admitted fault, expressed his embarrassment, and he offered to call the listing agent.

According to Mr. Capriotti, he asked what he could do to make things right and Ms. Montez suggested that he might self-report to the Department and she explained how to do so.

Mr. Capriotti testified that the next day, Ms. Montez informed him that the issue was taken care of, and that she had filed with the Department so that he did not have to self-report.

The Montezes required Mr. Capriotti to take an on-line ethics course as a result of the incident.

Mr. Capriotti is willing to accept a provisional license. He testified that something like this would not happen again because it was the result of a slip in judgment and the repercussions have been severe.

Mr. Montez’s testimony

Mr. Montez testified that he had “grown up” in the business.

Mr. Montez has worked with Mr. Capriotti and has seen his professionalism; there has never been any negative feedback from clients.

On the day of the incident, the listing agent called and explained the situation to Ms. Montez.

Ms. Montez and Mr. Montez watched the Ring doorbell video that is evidence before they spoke to Mr. Capriotti.

Mr. Montez spoke to Mr. Capriotti and told him what it looked like and asked what happened. Mr. Capriotti acknowledged his mistake and explained that his wife wanted light bulbs and that to avoid a long wait in a store, he had taken the light bulbs.

After Mr. Montez and Ms. Montez had spoken to Mr. Capriotti, Ms. Montez informed the listing agent that Mr. Capriotti admitted what he did and asked what result the listing client wanted to see. The listing client wanted to see some discipline imposed and Ms. Montez informed the listing agent that she would report the incident to the Department, and that Montez Realty would have Mr. Capriotti self-report and would require Mr. Capriotti to take a National Association of Realtor’s on-line ethics class.

The listing agent discussed it with their client and the client was satisfied that the matter was taken care of within 24 hours.

About ten or fourteen days later, the Department informed Montez Realty that the person who owned the house had filed a complaint.

Montez Realty received notice of the summary suspension and Mr. Capriotti’s real estate activities stopped. Mr. Capriotti is still employed with Montez Realty and Montez has no intention to sever his license.

Ms. Montez, Montez Realty’s designated broker, and Mr. Montez the owner, are both willing to continue to employ Mr. Capriotti.

Montez Realty has supervised an employee holding a provisional license and both Ms. Montez and Mr. Montez are willing to act as monitors for the next two years if the Department issues a provisional license to Mr. Capriotti.

Mr. Montez was asked his opinion of Mr. Capriotti’s honesty, truthfulness and character, to which he responded that he knows Mr. Capriotti personally, he has worked with Mr. Capriotti for more than ten years, he knows Mr. Capriotti’s character, and that Mr. Capriotti had suffered a lapse in judgment because it was convenient to take the light bulbs.

Mr. Montez has no worries or concerns that Mr. Capriotti will re-offend and he does not believe that Mr. Capriotti is a threat to the public health, safety and welfare.

Jason Dougherty’s testimony

Mr. Dougherty met Mr. Capriotti through a referral when his family moved to Phoenix in 2010. The two have remained Facebook friends.

Mr. Dougherty found Mr. Capriotti to be trustworthy.

There were issues getting a purchase completed that resulted in a need to get the sale completed in about three weeks. Mr. Capriotti was working on the matter when he had a stroke, but he continued to work for Mr. and Ms. Dougherty while he was in the hospital. Mr. Capriotti showed that he cared about more than just the money.

Two to three weeks before the hearing, Mr. Dougherty and his wife contacted Mr. Capriotti because they were thinking about moving again.

Mr. Capriotti came to their house and explained that his license was suspended and why. Mr. Capriotti offered to refer the Doughertys to another agent, but they decided to wait until the disciplinary action is completed.

Based on what he saw of Mr. Capriotti, Mr. Dougherty’s opinion was that Mr. Capriotti was acting out of character when he took the light bulbs. Mr. Capriotti showed nothing but integrity to the Doughertys. They would list their house with him and would not have any concern that Mr. Capriotti would have access to their house.

Traci Gratzek’s testimony

Ms. Gratzek has been a loan originator/officer for twenty-six years and has been licensed by the Department of Financial Institutions for seven years.

Mr. Capriotti makes a few referrals a year to Ms. Gratzek, which are not enough to impact her financially.

Ms. Gratzek works with many agents and considers Mr. Capriotti to be a good agent; he is a good person who is level headed and a “10.”

Ms. Gratzek has two children, one with special needs. After COVID hit, she needed bread one day and Mr. Capriotti had his wife bring her some. It was a small act, but not small at all.

Ms. Gratzek knew about the complaint and the incident with light bulbs, but she “absolutely” did not think that his license should be revoked. Her opinion is that it would be a loss to the industry if his license was revoked.

Ms. Gratzek was of the opinion that Mr. Capriotti had not stopped to think before he acted and that this was a momentary lapse in judgment.

Ms. Gratzek does not typically refer customers to agents (that is not how the business works) but she would be willing to refer a customer to Mr. Capriotti because she knows how he handles things.

CONCLUSIONS OF LAW

The Department bears the burden of persuasion. Ariz. Rev. Stat. § 41-1092.07(G)(2).

The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119.

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. section 32-2153(B) provides in pertinent part:

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 when it appears that the holder or applicant has:

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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.

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

Mr. Capriotti acknowledges that his taking the light bulbs from the house was not appropriate. By taking the light bulbs, Mr. Capriotti was not demonstrating honesty or good character. Consequently, the Commissioner has authority to discipline his license. Mr. Capriotti’s transgression was serious and discipline is appropriate.

The preponderance of the evidence shows however that Mr. Capriotti’s actions were out of character and the result of a lapse in judgment, rather than being indicative of his normal behavior. In addition, Mr. Capriotti returned the light bulbs before he left the property, which is a factor in mitigation. That Mr. Capriotti has not been the subject of any other complaints since he was licensed in 2002, weighs in his favor.

Mr. Capriotti’s license has been suspended for over three months, which is an appropriate measure of discipline considering the facts of this matter. It is also appropriate however for the Department to issue to Mr. Capriotti a provisional license requiring his designated broker to make quarterly reports to the Department to ensure that Mr. Capriotti commits no additional infractions.

RECOMMENDED ORDER

IT IS RECOMMENDED that the Department of Real Estate issue to John Capriotti a two-year provisional license.

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 is five days after the date of that certification.

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-137160-45720000Done this day, September 14, 2020.

/s/ Thomas Shedden

Thomas Shedden

Administrative Law Judge

Transmitted electronically to:

Judy Lowe, Commissioner

Arizona Department of Real Estate

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-137160-45720000