ALJDEC decisions subject to certification as final

20F-399-REL · Department of Real Estate · 2020-11-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

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

Mary McCabe, holder of License No. SA690641000 (Candidate),

Petitioner

No. 20F-399-REL

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: November 2, 2020

APPEARANCES: Petitioner Mary McCabe failed to appear. Assistant Attorney General Holly Wan represented the Arizona Department of Real Estate. Lara Hoover, Investigator, testified on behalf of the Arizona Department of Real Estate.

ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella

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 Arizona Department of Real Estate (“Department”).

FINDINGS OF FACT

Procedural History

The hearing of this matter convened on September 15, 2020, at 1:00 p.m. Petitioner Mary McCabe (“Petitioner”) appeared on her own behalf. Assistant Attorney General Holly Wan represented the Department. At the commencement of the hearing Petitioner requested a continuance of the hearing in order to allow her the opportunity to obtain counsel. Although the Department was ready to proceed to hearing, the Department did not object to a continuance. The Administrative Law Judge found good cause to continue the hearing and granted Petitioner’s request.

A Minute Entry Granting Continuance advising of the continued hearing date and time of November 2, 2020, at 9:00 a.m., issued to the parties on September 16, 2020. The Minute Entry also contained the Google Meet link for appearance for the hearing. On the date and at the time set for continued hearing, Petitioner failed to appear or be represented. After a ten (10) minute grace period, the hearing convened in Petitioner’s absence.

Petitioner’s Application

On or about June 9, 2020, Petitioner submitted to the Department an application to be licensed as a real estate salesperson.

Petitioner answered “yes” to the following questions on the application:

. . . .

(6) “Has the Applicant . . . [h]ad any judgment and/or order against them by ANY court involving fraud, dishonesty, misrepresentation, unfair trade practice, or moral turpitude?

. . . .

(12) “Has the Applicant . . . [b]een 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 has been pardoned, or the conviction is being appealed?”

. . . .

Petitioner attached a written explanation of her “yes” answers to her application where she detailed the circumstances giving rise to the conviction.

Petitioner disclosed to the Department the following:

In November 2013, Petitioner was convicted of Embezzlement in Macomb County, Michigan. Petitioner was released from probation in November 2018. Petitioner has a gambling addiction. Petitioner worked for a property management company at the time of the offense and was in charge of accounts payable. “This position gave me access to many customer bank accounts. I would write checks out to myself and go to the casino. The longer I did this, the worse it got and the more I needed.”

On June 24, 2020, the Department issued an Intent to Deny Application letter to Petitioner.

On July 17, 2020, the Department received a timely appeal letter from Petitioner.

Thereafter, the Department referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. On August 11, 2020, a Notice of Hearing was issued citing the issue for hearing as whether grounds existed to affirm the Department’s intent to deny Petitioner’s application for a real estate salesperson’s license pursuant to A.R.S. §§ 32-2153(B)(2), 32-2153(B)(5), 32-2153(B)(7), and 32-2153(B)(10).

Hearing Evidence

Petitioner failed to appear. The Department called Lara Hoover (“Investigator Hoover”) as a witness and submitted eight exhibits.

Lara Hoover’s testimony

At the hearing, the Department contended that Petitioner’s 2013 felony conviction constituted a violation of A.R.S. § 32-2153(B)(2). The Department further contended that Petitioner’s conduct, for which she had been convicted, also amounted to violations of A.R.S. §§ 32-2153(B)(5), 32-2153(B)(7), and 32-2153(B)(10). As such, the Department argued that multiple grounds existed to deny Petitioner’s application for a real estate salesperson license.

Investigator Hoover testified that she is a Senior Investigator with the Department. One of Investigator Hoover’s job duties is to determine licensure applicant eligibility. Per Investigator Hoover, in order for an applicant for a real estate salesperson license to be approved for licensure, the applicant must be professionally and morally qualified. Investigator Hoover testified that because of Petitioner’s felony conviction and the conduct involved with that conviction, the Department has concerns about granting a license to Petitioner.

Investigator Hoover testified that she reviewed the application and supporting documentation, including criminal records and Petitioner’s statement. Investigator Hoover testified regarding Petitioner’s criminal conviction and referenced a Judgment of Sentence in the State of Michigan 16th Judicial Circuit, Macomb County, in Case Number 2013-003458-FH. That document states that Petitioner plead guilty and was convicted of Embezzlement - $100,000.00 or More, and on November 12, 2013, was sentenced to sixty (60) months of probation, fifty (50) hours of community service, ordered to attend Gamblers Anonymous meetings, and Restitution was ordered in the amount of $182,508.34. The Case Details indicate that the offense occurred from March 1, 2009 until December 30, 2012.

Investigator Hoover testified that court records indicate that Petitioner has paid $27,292.00 of the court ordered restitution, leaving a balance owed of $155,216.34. Petitioner has not paid any restitution since September 21, 2017.

Investigator Hoover testified that Petitioner was successfully discharged from probation on November 21, 2018.

Investigator Hoover testified that the Department is statutorily required to ensure that applicants for licensure are of good character and honest. In this case, Petitioner was convicted of embezzlement and the offenses giving rise to the conviction occurred while Petitioner was employed in a position of trust and over the span of almost four years. As a licensed real estate salesperson, Petitioner would be in a positon in which she would be responsible for large financial transactions, and have access to personal information and to homes containing personal property. Additionally, Petitioner has not paid anything toward her restitution order in the past three years.

CONCLUSIONS OF LAW

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

This 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 (“A.A.C.”).

Pursuant to A.R.S. § 41-1092.07(G)(2) and A.A.C. R2-19-119(B), Petitioner bears the burden of proof in this matter to establish that she is rehabilitated and meets statutory qualifications for a real estate salesperson license. The standard of proof is 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.” It is “[e]vidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.”

A.R.S. § 32-2153(B) provides, in pertinent parts, as follows:

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:

. . . .

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.

. . . .

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.

. . . .

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

. . . .

10. Violated any federal or state law, regulation or rule that relates to real estate or securities or that involves forgery, theft, extortion, fraud, substantial misrepresentation, dishonest dealings or violence against another person or failure to deal fairly with any party to a transaction that materially and adversely affected the transaction. This paragraph applies equally to violations of which the licensee was convicted in any lawful federal or state tribunal and to any admissions made in any settlement agreement by the licensee to violations.

The legislature has charged the Department with protecting the public and consumers who deal with licensed salespersons when it issues licenses.

In this case, Petitioner has been convicted in a court of competent jurisdiction in Michigan of a felony, specifically embezzlement, a crime of theft, in violation of A.R.S. § 32-2153(B)(2).

Petitioner’s conviction for the crime of embezzlement demonstrates that she has been guilty of conduct which constitutes fraud or dishonest dealings, in violation of A.R.S. § 32-2153(B)(5).

Petitioner’s conviction for the crime of embezzlement and the actions leading to that conviction, fail to show that Petitioner is a person of honesty, truthfulness, and good character, in violation of A.R.S. § 32-2153(B)(7).

Petitioner’s conviction for the crime of embezzlement in the State of Michigan evidences Petitioner’s violation of federal or state law that involves theft or dishonest dealings, in violation of A.R.S. § 32-2153(B)(10).

Based on the above statutory violations, grounds exist to deny Petitioner’s application for a real estate salesperson license. Petitioner’s appeal should be denied and the Department’s denial of her application should be affirmed.

RECOMMENDED ORDER

Based upon the foregoing facts and conclusions of law,

IT IS RECOMMENDED that Mary McCabe’s appeal is denied and the Department of Real Estate’s decision to deny her application is affirmed.

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.

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-137160-45720000Done this day, November 9, 2020.

/s/ Sondra J. Vanella

Administrative Law Judge

Transmitted electronically to:

Judy Lowe, Commissioner

Arizona Department of Real Estate

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-137160-45720000