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Yarrigle v. Cal. Dept. of Real Estate

Yarrigle v. Cal. Dept. of Real Estate
06:06:2007



Yarrigle v. Cal. Dept. of Real Estate







Filed 4/17/07 Yarrigle v. Cal. Dept. of Real Estate CA3







NOT TO BE PUBLISHED



California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.



IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA



THIRD APPELLATE DISTRICT



(Sacramento)



STEPHANIE ANN YARRIGLE,



Plaintiff and Appellant,



v.



CALIFORNIA DEPARTMENT OF REAL ESTATE,



Defendant and Respondent.



C052975



(Super. Ct. No. 06CS00195)



The Department of Real Estate (DRE) revoked the unrestricted real estate salespersons license of appellant Stephanie Ann Yarrigle based on her nolo contendere plea to a charge of misdemeanor driving under the influence. During the administrative proceedings, DRE conceded that Yarrigles offense was not a crime involving moral turpitude.



On this appeal from the denial of her ensuing petition for a writ of mandate, Yarrigle contends there is no statutory authorization for DRE to revoke her license for the commission of a misdemeanor not involving moral turpitude. We agree, and reverse the judgment denying Yarrigle relief from the revocation of her license.



BACKGROUND



Yarrigle became a licensed real estate salesperson in December 2002.



In 2004, Yarrigle was convicted, by plea of nolo contendere, of violating Vehicle Code section 23152, subdivision (a), by driving under the influence of alcohol, a misdemeanor. In that proceeding, she also admitted to a 1999 driving under the influence conviction.



In 2005, DRE filed an accusation[1]against Yarrigle alleging that her 2004 drunk driving conviction constituted a crime involving moral turpitude, and/or a crime which bears a substantial relationship under Section 2910 of Title 10, California Code of Regulations, to the qualifications, functions, or duties of a real estate licensee. The accusation also alleged that Yarrigles conviction constitute[s] cause under Sections 490[[2]] and 10177[, subdivision] (b)[[3]] of the [Business and Professions] Code for suspension or revocation of [Yarrigles real estate salespersons license].



As a matter in aggravation, the DRE identified Yarrigles 1999 conviction of violating Vehicle Code section 23152, subdivision (b), driving while having a blood alcohol content of .08 percent or higher.



A hearing on DREs accusations was held before an administrative law judge (ALJ).[4]



The ALJ concluded that section 10177, subdivision (b) provided no basis for disciplining Yarrigles license because her 2004 misdemeanor conviction is not a crime of moral turpitude. The ALJ found cause for disciplinary action under Business and Professions Code section 490 only, ruling that section expressly allows the use of a nolo contendere plea as a basis for discipline against a license, and rejecting Yarrigles argument that Penal Code section 1016 precluded the use of her 2004 conviction based on a nolo contendere plea. The ALJ recommended revoking Yarrigles license, but recommended allowing her to apply for a restricted license under which the commissioner could (1) suspend her license prior to the hearing in the event of certain specified violations, and (2) place other conditions upon the license. (See 10156.6, 10156.7.) Finally, the proposed decision barred Yarrigle from reapplying for an unrestricted license or seeking removal of any conditions placed on her license for two years following the effective date of the proposed decision.



The real estate commissioner adopted the ALJs proposed decision in its entirety.



Yarrigle petitioned the trial court for a writ of mandate ordering DRE to set aside its decision revoking her license. The court denied the petition, finding in relevant part that the DREs findings are supported by the weight of the evidence, its decision was supported by the findings and Yarrigle failed to show that the penalty was an abuse of discretion.



This appeal followed.



DISCUSSION



Yarrigles principal argument on appeal is that her 2004 misdemeanor conviction for a crime that DRE concedes does not involve moral turpitude cannot support disciplinary action under the applicable statutes.



She urges us to follow the First District Court of Appeal decision in Petropoulos v. Department of Real Estate, supra, 142 Cal.App.4th 554 (Petropoulos), which was filed after the trial courts denial of her petition for writ of mandate, and held that (1) section 490 does not provide independent statutory authorization for DRE to suspend or revoke the license of a person based on his or her conviction of a crime. Only section 10177, subdivision (b) grants DRE that authority; and (2) section 10177, subdivision (b) does not authorize DRE to take disciplinary action against a licensee convicted of a misdemeanor, unless the offense involves moral turpitude. (Id. at p. 567.) Since Yarrigles conviction concededly falls outside section 10177, subdivision (b), she contends DREs revocation of her real estate license was unauthorized by law.[5]



This issue raises only a question of law which is subject to our independent review. (Donaldson v. Department of Real Estate (2005) 134 Cal.App.4th 948, 954; see also 9 Witkin, Cal. Procedure (4th ed. 1997) Administrative Proceedings, 111, p. 1156 [A person aggrieved by an agency determination has a right to independent judicial review of questions of law, such as those dealing with the interpretation and application of statutes or judicial precedents.].) DRE notes in a footnote to its responsive brief that the record on appeal does not contain the full administrative record. But the sufficiency of section 490 as a basis for disciplinary action -- and, more particularly, whether we find the analysis of this question in Petropoulos persuasive -- presents a pure question of statutory interpretation that can be resolved without consideration of any facts that were disputed in the administrative proceedings. (See Petropoulos, supra, 142 Cal.App.4th at p. 561.)



And, indeed, we conclude Yarrigles argument does have merit.



Section 490 states that [a] board may suspend or revoke a license on the ground that the licensee has been convicted of a crime, if the crime is substantially related to the qualifications, functions, or duties of the business or profession for which the license was issued. Subdivision (a)(11) of its regulation 2910, which establishes criteria to be used by the DRE in making such determinations (Cal. Code Regs., tit. 10, 2910 (hereafter Regulation 2910)), provides in pertinent part that, [w]hen considering whether a license should be denied, suspended or revoked on the basis of the conviction of a crime . . . the crime . . . shall be deemed to be substantially related to the qualifications, functions or duties of a licensee of the Department within the meaning of Section[] . . . 490 of the Code if it involves: [] . . . [] (11) Two or more convictions involving the consumption or use of alcohol or drugs when at least one of the convictions involve driving and the use or consumption of alcohol or drugs.



The trial courts decision supports the DREs determination that section 490, standing alone, authorizes DRE to suspend or revoke a real estate salespersons license



But the court of appeal in Petropoulos, supra, 142 Cal.App.4th 554 conducted an extensive examination of section 490s statutory context and legislative history (Id. at p. 561) and concluded, to the contrary, that section 490 operates solely to limit DREs power to suspend or revoke under section 10177, subdivision (b), which itself authorizes the revocation of licenses only for a conviction of a crime involving moral turpitude. (Id. at pp. 564-565, 567-568.)



In Petropoulos, the DRE Commissioner revoked a real estate brokers license after he pleaded nolo contendere to misdemeanor battery against his former wife. (Petropoulos, supra, 142 Cal.App.4th at pp. 556-560.) The DREs argument in favor of revocation did not mention section 10177, and it relied exclusively on section 490, contending that disciplinary action was warranted because Petropoulos committed a crime substantially related to the qualifications, functions, or duties of a real estate licensee for the purposes of that section. (Petropoulos, at p. 559.) After Petropouloss petition for a writ of mandate was denied, he appealed, asserting that section 490 does not provide a basis, independent of section 10177, for disciplining his license. (Id. at pp. 560-561.)



The court agreed. Examining the legislative history of section 490, the court concluded that section was not intended to replace or supersede existing provisions -- including section 10177 -- which authorized the revocation of licenses only for convictions involving moral turpitude; [i]nstead, it merely required all of the boards having such authorizing provisions to take the relationship of the crime to the licensed activity into account before applying them . . . . (Petropoulos, supra, 142 Cal.App.4th at p. 562 [According to a committee analysis of the legislation creating Division 1.5 [of which section 490 is part], the measure was introduced as a result of a staff study and report which concluded, among other things, that licensing statutes were being applied in an unreasonable and discriminatory manner to punish individuals for past crimes, without regard to the relevance of the crime to the licensed activity].)



Indeed, the court in Petropoulos concluded, [w]e have found no indication in the legislative history of Division 1.5 that section 490 was intended to independently authorize licensing boards to revoke or suspend licenses on the ground that a licensee had been convicted of a crime. To the contrary, the starting premise for both the 1972 and 1974 amendments was that the boards enjoyed too much discretion under their licensing statutes, and were exercising it in an arbitrary and standardless fashion to further penalize licensees for crimes that had no bearing on their fitness to practice their profession. (Petropoulos, supra, 142 Cal.App.4th at p. 564.) Moreover, the court opined, [i]n our view, the intent of the 1974 amendment to section 490 was to eliminate the discretion of the various licensing boards to discipline their licensees for crimes or offenses that bore no substantial relationship to the functions and duties performed by their licensees. It was not intended to provide an additional ground for disciplining licensees over and above those enumerated in the licensing laws specific to each profession, nor was it intended to replace or supplant the grounds for imposing discipline for criminal convictions that were (and still are) set forth in the separate licensing statutes of each business and profession covered by Division 1.5. (Ibid.)



In addition, the Petropoulos court noted, [a] number of post-1974 cases applying section 490 in the real estate context have implicitly or explicitly taken the same view of its intent that we adopt here -- that it limits, not augments, the powers DRE otherwise would have under section 10177 to take disciplinary action against a licensee convicted of a crime. (Petropoulos, supra, 142 Cal.App.4th at pp. 564-565, citing Arneson v. Fox (1980) 28 Cal.3d 440, 445-446, 449 [ 490 imposes a further requirement on the application of 10177, subd. (b) and tempers the commissioners discretion under that subdivision]; Pieri v. Fox (1979) 96 Cal.App.3d 802, 805-807 [proof of a crime involving moral turpitude insufficient to support denial of real estate license; 480 adds an additional factual requirement that past offense must be substantially related to qualifications for a real estate license]; Golde v. Fox (1979) 98 Cal.App.3d 167, 179-180 [revocation of real estate license depended on proof of three facts: (1) guilty plea to (2) a felony or crime involving moral turpitude that was (3) substantially related to licensees fitness to practice as a real estate broker]; Harrington v. Department of Real Estate (1989) 214 Cal.App.3d 394 [to support denial of a license, DRE must prove both that licensee was convicted of a misdemeanor involving moral turpitude and that crime bore a substantial relationship to his qualifications for license]; and Brandt v. Fox (1979) 90 Cal.App.3d 737 [same]; see also Donaldson v. Department of Real Estate, supra, 134 Cal.App.4th at p. 955 [section 490 limits the discretion of licensing authorities and temper[s] section 10177, which [s]tanding alone . . . would authorize discipline for any conviction involving moral turpitude].)



Thus, [a]t least since Arneson v. Fox [supra, 28 Cal.3d 440] was decided in 1980, DRE has been on notice that the moral turpitude requirement placed it under a dual burden of proof in misdemeanor conviction cases: It must prove both that the crime involved moral turpitude and that it bore a substantial relationship to the duties of a real estate licensee. (Petropoulos, supra, 142 Cal.App.4th at p. 567.)[6]



We find Petropoulos persuasive: section 490 provides no independent statutory authorization for DRE to suspend or revoke the license of a person based on his or her conviction of a crime. Only section 10177, subdivision (b) grants DRE that authority, and that section does not authorize DRE to take disciplinary action against a licensee convicted of a misdemeanor, unless the offense involves moral turpitude. Here, DREs accusation against Yarrigle indicates that what should have been a two-prong test created by sections 10177, subdivision (b) and 490 could be stated in the alternative: it alleged that Yarrigles 2004 conviction for drunk driving constitutes a crime of moral turpitude and/or represents a crime which bears a substantial relationship to the duties of a real estate licensee. This was error: the ALJ -- and, subsequent trial court -- should have required the DRE to prove both prongs before ordering that Yarrigles license be revoked.



Moreover, here, DRE cannot meet the two-part test, because the ALJ properly found that Yarrigles 2004 misdemeanor alcohol-related conviction does not represent a crime of moral turpitude (see In re Kelly (1990) 52 Cal.3d 487, 494; In re Jennings (2004) 34 Cal.4th 254, 267-268) and concluded, based on that finding, that section 10177, subdivision (b) provides no basis for disciplining Yarrigles license.



Since Yarrigles conviction concededly did not come within section 10177, subdivision (b), DREs revocation of her real estate salespersons license was unauthorized by law.[7]



DISPOSITION



The judgment is reversed and the matter is remanded to the trial court with directions to issue a peremptory writ of mandate. Costs are awarded to appellant.



BLEASE , Acting P. J.



We concur:



DAVIS , J.



BUTZ , J.



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[1] DRE proceedings to deny, suspend or revoke a real estate license are initiated by the filing of an accusation. (Gov. Code, 11503; Bus. & Prof. Code, 10100; Petropoulos v. Department of Real Estate (2006) 142 Cal.App.4th 554, 556.)



[2] Business and Professions Code section 490 applies, with specified exceptions, to all professional licensing boards or commissions governed by the Business and Professions Code. ( 475, 476.) Section 490 states in relevant part: A board may suspend or revoke a license on the ground that the licensee has been convicted of a crime, if the crime is substantially related to the qualifications, functions, or duties of the business or profession for which the license was issued. A conviction within the meaning of this section means a plea or verdict of guilty or a conviction following a plea of nolo contendere.



Further unspecified statutory references are to the Business and Professions Code.



[3] Section 10177, subdivision (b), which applies to real estate licensees only, states in relevant part: The commissioner may suspend or revoke the license of a real estate licensee . . . who has . . . . [] . . . [] . . . [e]ntered a plea of guilty or nolo contendere to, or been found guilty of, or been convicted of, a felony or a crime involving moral turpitude . . . .



[4] No transcript of those proceedings are in the record on appeal. The ALJs proposed decision indicates Yarrigle testified about the circumstances leading to her conviction, when she and her then boyfriend were drinking, argued, and she drove to her mothers house rather than wait for a taxi to arrive.



[5] DRE declines to make any response whatever to this argument. A contention raised in an appellants brief to which respondent makes no reply in its brief will be deemed submitted on appellants brief. (California Ins. Guarantee Assn. v. Workers Comp. Appeal Board (2005) 128 Cal.App.4th 307, 316, fn. 2.)



Nor does DRE challenge Yarrigles right to raise the issue for the first time on appeal. Of course, Petropoulos had not been decided when the administrative writ proceeding was pending in the trial court, but even the statutory question of the interplay of sections 490 and 10177, subdivision (b) considered in that decision can be raised here for the first time on appeal. Generally, points not raised in the trial court are deemed waived on appeal. [Citation.] But the waiver rule carries an important exception where the theory presented for the first time on appeal involves only a legal question determinable from facts which not only are uncontroverted in the record, but which could not be altered by the presentation of additional evidence. [Citation.] In such cases, whether the general rule shall be applied is largely a question of the appellate courts discretion. [Citation.] (Petropoulos, supra, 142 Cal.App.4th at p. 561.) We here exercise our discretion to consider it.



[6] Since those cases construing section 490, DRE had an opportunity to eliminate the moral turpitude requirement from section 10177, subdivision (b), but chose not to. (Petropoulos, supra, 142 Cal.App.4th at p. 567.)



[7] In light of this determination, it is unnecessary to reach Yarrigles further contentions that her nolo contendere plea should have been admissible in the administrative proceeding; that her 1999 conviction which predated her license cannot bear a substantial relationship to the duties of a licensee, within the meaning of the applicable regulation; or that the ALJs consideration of her 1999 conviction represented an improper dual use of facts.





Description The Department of Real Estate (DRE) revoked the unrestricted real estate salespersons license of appellant Stephanie Ann Yarrigle based on her nolo contendere plea to a charge of misdemeanor driving under the influence. During the administrative proceedings, DRE conceded that Yarrigles offense was not a crime involving moral turpitude.
On this appeal from the denial of her ensuing petition for a writ of mandate, Yarrigle contends there is no statutory authorization for DRE to revoke her license for the commission of a misdemeanor not involving moral turpitude. Court agree, and reverse the judgment denying Yarrigle relief from the revocation of her license.

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