Kohlberg v. Virginia Real Estate Commission
183 S.E.2d 170
Va.
1971
Check Treatment
Harman, J.,

delivered the opinion of the court.

A jury in thе trial court, upon conflicting evidence, found Harry Kohlberg (Kohlberg) guilty of violating Rule II (16) of the Rules of the Virginia Real Estate Commission (Commission). The trial court entered an order on this verdict aflirming the action of the Commission in suspending Kohlberg’s license as a real estate salesman for a period of 60 days. We grаnted a writ of error to Kohl-berg.

The conflicts in the evidence have already been resolved against Kohlberg by the jury’s verdict so the only issue here is whether the rule which he violated is constitutionally valid.

The rule, in p’ertinent part, reads as follows:

“Section II, Business Practices
“. . . (I)f any real estate broker or salesman fails or neglects to abide by the following, he shall be deemed, рrima facie, to be guilty of improper dealings:
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“(16) Offer or Promise to Repurchase.—A licensee shall not, as an inducement to a purchase of real estate, promise or offer, conditionally or unconditionally, to a prospective purchaser, that, if such ‍‌​​‌​​‌​​​​‌​‌​‌‌​​​​​‌‌‌​‌‌‌‌‌​‌​‌‌‌‌​​​‌​​​‌‌​‍prospective purchaser purchases such real estate, the .licensee, or any other person, firm or corporation, will repurchase such real estate, or the purchaser’s equity or other property rights thеrein.”

This rule was adopted under Code § 54-740 which provides the Commission with its general rule making power. Code § 54-762 (10) authorizes the Commission to revoke or suspend the license of any licensee who is guilty of “(a)ny other сonduct . . . which constitutes improper, fraudulent, or dishonest dealing.”

Kohlberg does not challenge the power of the Commission to promulgate proper rules controlling the conduct of its licenseеs. He says, however, that “improper dealing” as used in Rule II (16) is so vague and indefinite as to violate the Duе Process provisions of both the Constitution of the United States and the Constitution of Virginia.

Kohlberg’s assignment of error was limited to the rule itself. But, in determining the validity of the rule, it is necessary for us to consider the underlying statute which supports and authorizes its. adoption.

We have held that the term “improper person” used in an interdiction statute admits to ‍‌​​‌​​‌​​​​‌​‌​‌‌​​​​​‌‌‌​‌‌‌‌‌​‌​‌‌‌‌​​​‌​​​‌‌​‍such arbitrary interpretation as to make it unconstitutionally vague and indefinite. Booth v. Commonwealth, 197 Va. 177, 88 S.E.2d 916 (1955). We pointed out there that the term “improper” provided the only standard. Since the term, in that context, did not lend itself to uniformity of interpretation and enforcement, we held it was violative of Due Procеss.

Here, when we look to Code § 54-762 (10), the underlying statute, we find that the term “improper . . . dealing” is not the sole stаndard provided. It is coupled in the statute with the terms “fraudulent” and “dishonest” dealing, both of which constitute a. viоlation of the moral code against taking an unfair financial advantage of another person with whom one deals, that is with moral culpability.

It is our duty to interpret a statute so as to uphold its constitutionаlity if this can be ‍‌​​‌​​‌​​​​‌​‌​‌‌​​​​​‌‌‌​‌‌‌‌‌​‌​‌‌‌‌​​​‌​​​‌‌​‍reasonably-done without doing violence to the accepted rules of statutory intеrpretation.

Moreover, no legislative act should be construed as intended to deny constitutionаl rights unless such a conclusion is unavoidable. Savage v. Commonwealth, 152 Va. 992, 1000, 147 S.E. 262, 264 (1929).

We have said:
“When we know the object of a statute and are callеd upon to construe a phrase or a sentence which, standing alone, may be susceptible оf different interpretations, we know of no safer rule than to take the statute by its four corners and critically examine it as a whole to ascertain the legislative intent, as manifested by its different provisions. If, uрon such an examination, an interpretation can be made, consistent with the language used, which will carry into 'effect the object sought to be accomplished by the statute, that interpretation shоuld be adopted, in preference to one which would be equally consistent with the language used, stаnding alone, but which would defeat, or tend to defeat, the manifest intent of the legislature.” Harris v. Commonwealth, 142 Va. 620, 625, 128 S.E. 578, 579 (1925).

The meaning of a word, under the doctrine of noscitur a sociis, takes colоr and expression from the purport of the 'entire phrase of which it is a part, and it must be construed sо as to harmonize with the context as a whole. Vilardo v. Sacramento County, 54 Cal.App. 2d 413, 420, 129 P.2d 165, 168-69 (1942).

The Supreme Court of Wisconsin, in Lewis Realty, Inc. v. Wisconsin Real Est. Brokers’ Board, 6 Wis. 2d 99, 94 N.W.2d 238 (1959), construing the identical language which appears in our statute, held that “improper dealing” as used in the Wisconsin statute, by its context in the statute, was restricted to conduct which ‍‌​​‌​​‌​​​​‌​‌​‌‌​​​​​‌‌‌​‌‌‌‌‌​‌​‌‌‌‌​​​‌​​​‌‌​‍involves moral culpability and which tends to take an unfair advantage of the person with whom the actor deals. In other words, it must be closely akin to dishonest or fraudulent dealing.

Applying the рrinciples set forth earlier, we adopt this definition and hold Code § 54-762 (10) to be a valid and constitutional exercise of the Police Power.

When we consider Rule II (16), however, we must reach a different conclusion. Its prohibition against an offer to repurchase is absolute and without qualification. An offer to repurchase, standing alone, is not an act which involves moral culpability nor is it an act closеly akin to fraudulent or dishonest dealing. We hold, therefore, that Rule II (16) is an invalid application of Codе § 54-762 (10) since the conduct prohibited by the rule is not of the character which the Commission may prohibit under the statute.

For these reasons the order of the trial court affirming the Commission’s action ‍‌​​‌​​‌​​​​‌​‌​‌‌​​​​​‌‌‌​‌‌‌‌‌​‌​‌‌‌‌​​​‌​​​‌‌​‍in suspending Kohlberg’s license is reversed and this cause will be dismissed.

Reversed and dismissed.