Barlow v. Ohio Dept. of Commerce, Div. of Real Estate & Professional LicensingBarlow v. Ohio Dept. of Commerce, Div. of Real Estate & Professional Licensing
Rendered on August 17, 2010
Madison & Rosan, LLP, and Kristin E. Rosan, for appellant.
Richard Cordray, Attorney General, and Theodore L. Klecker, for appellee.
APPEAL from the Franklin County Court of Common Pleas.
McGRATH, J.
{¶1} Appellant, David E. Barlow, a licensed real estate broker, appeals from the judgment of the Franklin County Court of Common Pleas affirming the adjudication order of appellee, Ohio Real Estate Commission (“commission“), that issued sanctions against appellant‘s license for violations of
{¶2} Appellant had been a real estate salesperson with HER, Inc. (“HER“), from 2000 to 2004. In April 2006, over 700 licensees of HER received emails that were sent by appellant but were purported to be from “Herbie R. Jr.” at
{¶3} On February 12, 2007, a complaint was filed against appellant with the Ohio Department of Commerce, Division of Real Estate and Professional Licensing (“division“), concerning appellant‘s use of internet domain names and email addresses. Eight days later, the division sent appellant a notice of complaint. After determining the existence of reasonable and substantial evidence of acts in violation of
{¶4} At its May 6, 2009 meeting, the commission reviewed the evidence and adopted the findings of fact and conclusions of law of the hearing examiner. Based on
{¶5} Pursuant to
- The Lower Court Erred As A Matter Of Law When It Failed To Reverse The Commission‘s Decision As A Result Of The Commission‘s Failure To Certify A Complete Record.
- The Lower Court Erred As A Matter Of Law When It Failed To Reverse The Commission‘s Decision Because Such Decision Is Contrary To Law And Is Not Supported By Reliable, Probative And Substantial Evidence In That Barlow Was Not Provided Notice The Alleged Conduct Was A Violation Of
R.C. 4735.01 et seq. - The Lower Court Erred As A Matter of Law When It Failed To Reverse The Commission‘s Decision Because Such Decision Is Contrary To Law And Is Not Supported by Reliable, Probative And Substantial Evidence In That It Purports To Impose Sanctions For A Violation Of The Canons of Ethics, Which Are Not A Properly Adopted Rule Pursuant To
R.C. Chapter 119 . - The Lower Court Erred As A Matter Of Law When It Failed To Reverse The Commission‘s Decision Because Such Decision Is Contrary to Law And Is Not Supported By Reliable, Probative And Substantial Evidence In That Barlow Was Denied His Due Process Rights When He Was Precluded From Reviewing Certain Documents Contained In The Confidential Investigative File And Cross-Examining A
Witness Relating To Such Documents When She Relied On the Same In Her Direct Testimony.
{¶6} In an administrative appeal pursuant to
{¶7} Reliable, probative, and substantial evidence has been defined as follows:
(1) “Reliable” evidence is dependable; that is, it can be confidently trusted. In order to be reliable, there must be a reasonable probability that the evidence is true. (2) “Probative” evidence is evidence that tends to prove the issue in question; it must be relevant in determining the issue. (3) “Substantial” evidence is evidence with some weight; it must have importance and value.
(Footnotes omitted.) Our Place, Inc. v. Ohio Liquor Control Comm. (1992), 63 Ohio St.3d 570, 571.
{¶8} On appeal to this court, the standard of review is more limited. Unlike the court of common pleas, a court of appeals does not determine the weight of the evidence. Rossford Exempted Village School Dist. Bd. of Edn. v. State Bd. of Edn. (1992), 63 Ohio St.3d 705, 707. In reviewing the court of common pleas’ determination that the commission‘s order was supported by reliable, probative, and substantial evidence, this court‘s role is limited to determining whether the court of common pleas abused its discretion. Roy v. Ohio State Med. Bd. (1992), 80 Ohio App.3d 675, 680. The term abuse of discretion connotes more than an error of law or judgment; it implies that the
{¶9} In his first assignment of error, appellant contends the commission‘s order must be reversed because the commission failed to certify a complete record to the trial court. Specifically, appellant asserts two items are missing from the certified record. One is a copy of
{¶10} Indeed,
{¶11} Appellant makes no argument as to how he is prejudiced by the omission of the Ohio Administrative Code rule, and we fail to find any such prejudice. Therefore, appellant is not entitled to reversal on this basis. With respect to the transcript, we note
{¶12} Lorms, supra, held that an agency‘s omission of items from a certified record of an appealed administrative proceeding does not require a finding for the appellant pursuant to
{¶13} Here, the commission‘s May 13, 2009 order reflects the five members that were present at the May 6, 2009 meeting and that all five of the members voted in favor of adopting the hearing examiner‘s findings of fact and conclusions of law and imposing the previously described sanctions. Thus, the record adequately reflects the commission‘s vote, even listing how each member voted, and we fail to see how appellant is prejudiced in this instance. See Gahm v. Ohio State Bd. of Cosmetology (Dec. 10, 1992), 4th Dist. No. 92CA2074 (finding that although neither the minutes of the board‘s adoption of the
{¶14} There is nothing before us to suggest the trial court was in any way inhibited from rendering a decision given the omission, nor does appellant allege that the outcome would have been any different had the transcription of the vote been included. Because appellant has failed to establish he was prejudiced by the omissions in the certified record, we find no merit to the arguments contained in his first assignment of error and, accordingly, overrule the same.
{¶15} Appellant‘s remaining assignments of error contend the commission‘s order must be reversed because it is not supported by reliable, probative, and substantial evidence and is contrary to law. Specifically, in his second assignment of error, appellant contends this is so because he was not provided with notice that his conduct was a violation of
{¶16} Appellant was found to have violated
(A) * * * Subject to section
4735.32 of the Revised Code, the Ohio real estate commission * * * shall, pursuant to section4735.051 [4735.05.1 ] of the Revised Code, impose disciplinary sanctions upon any licensee who, in the licensee‘s capacity as a real estate broker or salesperson, or in handling the licensee‘s own property, is found guilty of:* * *
(6) Dishonest or illegal dealing, gross negligence, incompetency, or misconduct;
* * *
(12) Having falsely represented membership in any real estate professional association of which the licensee is not a member[.]
{¶17} As indicated in the NOH, appellant was alleged to have violated the above-mentioned provisions by engaging in the following:2
- Sent and/or facilitated the sending of an email, subject “Inside Real Living,” to licensees affiliated with HER from an email address herbie@insiderealliving.com that contained a message from “Herbie R Jr” misleading recipients as to the origin and content of said email[.]
- Employed the use of internet domain names with names of, or similar to licensed, real estate agents not affiliated with your brokerage. When a user visited those sites that user was diverted to the website of RE/MAX First Choice, LLC, the company with which your license was affiliated. * * *
- * * *
- Registered and used the internet domain name “www.insiderealliving.com” and/or sent or facilitated the sending of emails from addresses using “@insiderealliving.com” when your license was not affiliated with that company or doing business as HER Real Living.* * *
{¶18} According to appellant, the conduct alleged in the NOH “boils down to (i) the registration and (ii) use of internet domain names.” (Appellant‘s brief at 8.) Because the registration and use of internet domain names is not expressly prohibited by law and does not constitute inherently dishonest, illegal, grossly negligent or incompetent conduct, appellant contends he was not provided with notice that the conduct set forth in the NOH was forbidden. In support, appellant relies on Hughes v. Ohio Div. of Real Estate (1993), 86 Ohio App.3d 757.
{¶20} The Second District Court of Appeals noted Hughes‘s conduct was not inherently wrong in and of itself or illegal from the very nature of the transaction, i.e., malum in se, nor was Hughes‘s conduct prohibited or expressly forbidden by positive law, i.e., malum prohibitum. Nonetheless, because the Supreme Court of Ohio in Richard T. Kiko Agency, Inc. v. Ohio Dept. of Commerce, Div. of Real Estate (1990), 48 Ohio St.3d 74, had upheld the discipline of a real estate broker for precisely the same conduct in which Hughes engaged, the Second District upheld the sanction against Hughes‘s license.
{¶21} Persons holding real estate licenses are held to a higher standard of competency and fairness than are lay members of the general public in the market place. Kiko Agency at 75. Moreover, regulatory agencies, such as the commission, may rely on their own expertise in deciding whether certain conduct violates professional standards. Boggs v. Ohio Real Estate Comm., Div. of Real Estate & Professional Licensing, 186 Ohio App.3d 96, 2009-Ohio-6325, ¶33, citing Kiko Agency. As discussed by the Eighth District Court of Appeals in Hughes v. Ohio Real Estate Comm. (July 22, 1999), 8th Dist. No. 74480, “It would be impossible for lawmakers and rulemakers to spell out in detail every type of conduct that constitutes misconduct by a real estate broker. This is the precise reason why the Commission must be given considerable discretion in determining whether certain conduct is violative of the standard of practice in the industry.” Id.
{¶22} Appellant contends he merely registered and used internet domain names, which is neither malum in se nor malum prohibitum. To some extent we agree with appellant as the hearing examiner recognized that the registration of a website domain name ordinarily would not itself constitute a chargeable offense under
{¶23} Appellant also registered five other internet domain names that were the same as the personal names of the Rouda‘s. Internet users who visited these sites would then be diverted to a Re/Max website of appellant‘s. Again, as noted by the hearing examiner, appellant admitted these actions were directed to the public as he admitted he registered the domain names with the intention that the public would search their names.
{¶25} In his third assignment of error, appellant contends the commission‘s order must be reversed because it imposes sanctions for a violation of the canons of ethics (“canons“), that are not properly adopted rules pursuant to
{¶26} The right to engage in the real estate business is a privilege granted by the state. Kiko Agency at 76. Thus, “the General Assembly established the Ohio Real Estate Commission, comprised of experts with the responsibility of regulating the industry and adopting the canons of ethics.” Id.;
{¶27} In his fourth assignment of error, appellant argues his due process rights were violated when he was precluded from reviewing documents contained in a confidential investigative file and cross-examining a witness about such documents. At the hearing, the division presented the testimony of its investigator that the superintendent‘s decision to issue charges was made on October 9, 2008. On cross-examination, appellant attempted to place this testimony in question. According to appellant, this testimony is crucial to determine whether the superintendent complied with
{¶28} There are two flaws with appellant‘s argument. First, contrary to appellant‘s assertion, appellant did not “request” any documents from the commission‘s investigative file. The record reflects that on cross-examination, appellant‘s counsel asked the investigator how she knew the date upon which the superintendent decided to proceed with charges, and the investigator indicated she obtained the date from the computer. When further questioned about how the date comes to be placed in the computer, the division objected on the basis of “delving into the realm of confidential information.” (Jan. 21, 2009 Tr. 24.) Appellant argued that if the state was going to offer a particular date to prove jurisdiction then he was entitled to cross-examine the witness and determine whether or not the date was accurate. Counsel stated: “There is no documentary evidence that‘s been offered to substantiate the date. Respondent has not
[Appellant‘s counsel]: Okay. I guess the question – just so I have clarification my question was whether the Superintendent makes a note in the file or elsewhere so that the secretary that enters the date knows what date to enter. That was my question so I am not sure whether or not that‘s within the limitation or not.
[Hearing examiner]: And you are saying that it‘s within the limitation that that‘s confidential, Mr. Kleckler?
[Appellee‘s counsel]: My response would be she can testify that she reviewed the file and gleaned the date from that file. As far as having those documents released or provided to opposing counsel, those documents remain confidential.
[Hearing examiner]: I think [appellant‘s counsel] is asking how is that information conveyed. Is it by memo? Is it by – I am not going to allow anyone to see the memo but –
[Appellee‘s counsel]: I have no objection to that form of question.
(Tr. at 25-26.)
{¶29} Questioning continued and the investigator testified that the superintendent prepared a memo containing the date, and, according to the memo she reviewed, the date was October 9, 2008, which was the same date that appeared on the computer. The record belies appellant‘s argument that he sought the production of documents and was thereafter denied the same. In fact, the transcript demonstrates the hearing examiner even clarified that appellant was asking only about how the information was
{¶30} More importantly, however, appellant appears to argue before us that the memo at issue is imperative because the superintendent‘s compliance with
Within sixty business days after receipt of the complaint, or, if an informal meeting is held, within sixty days of such meeting, the investigator shall file a written report of the results of the investigator‘s investigation with the superintendent. Within fourteen business days thereafter, the superintendent shall review the report and determine whether there exists reasonable and substantial evidence of a violation of section
4735.18 of the Revised Code by the licensee. If the superintendent finds such evidence exists, within seven business days of the determination, the superintendent shall notify the complainant and licensee of the date of a hearing to be held by a hearing examiner pursuant toChapter 119. of the Revised Code within fifteen days but not prior to seven days thereafter, except that either the superintendent or the licensee may request an extension of up to thirty business days for good cause shown.
{¶31} Recently, in Boggs, supra, this court held that “the time frames set forth in
{¶32} Having overruled appellant‘s four assignments of error, we affirm the judgment of the Franklin County Court of Common Pleas.
Judgment affirmed.
TYACK, P.J., and BROWN, J., concur.
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