Jim Porter: Real estate license suspended for minor unrelated conviction?
January 23, 2014
Bulletin: Real estate agents may lose their licenses for minor misdemeanor convictions unrelated to their real estate activities.
HIT AND RUN
Peggie Ryan-Lanigan was driving home from her office at 6:00 in the evening. She rear-ended a vehicle. No injuries, minor damage.
Ryan-Lanigan did not wait for the CHP and instead left the scene without giving her name or address. CHP officers went to Ryan-Lanigan's home, saw a TV was on but no one answered the door.
She was cited for unsafe speed and misdemeanor hit and run with property damage.
On the advice of her attorney, she pled nolo contendere (no contest) to the hit and run to avoid a jury trial and attorney's fees. She claimed she had to leave the accident scene because she was dizzy and had diarrhea.
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On the advice of her second attorney, she withdrew her plea to hit and run from an accident and pled no contest to driving at an unsafe speed.
She had a good reason for doing so. She did not realize that by pleading no contest to hit and run, her real estate license could be suspended or revoked.
Business and Professions Code 10177 states that the Department of Real Estate may suspend or revoke the license of a real estate licensee who has, "… entered a plea of guilty or nolo contendere … or been convicted of, a felony, or a crime substantially related to the qualifications, functions, or duties of a real estate licensee …"
When I first came across this code years ago, I assumed that the phrase "a crime substantially related to the qualifications, functions, or duties of a real estate licensee" had to do with activities as a real estate agent. Steal from the trust account, you lose your license.
What I learned is that DRE takes a much broader view of Section of 10177. For example, a DUI might be sufficient to jeopardize a license, as would failing to disclose a DUI on an application. Leaving the scene of a minor accident is grounds for having your license suspended or revoked.
My take of DRE's interpretation of the code is that any conviction that arguably has anything to do with the integrity or ethics of the licensee may be deemed sufficient to be a crime "substantially related to the qualifications, functions or duties of a real estate licensee."
I am not sure I buy that, especially when there is another set of laws called the Penal Code to deal with people who commit crimes.
This case was primarily about whether DRE could suspend Ryan-Lanigan's license because she had pleaded no contest to misdemeanor hit and run with property damage – then revoked that plea.
The Court of Appeal ruled the Department could not suspend her license as her ultimate plea was to unsafe driving.
The purpose of this column is to give real estate agents a "heads up" about how Section 10177 can put in jeopardy your license. Your meal ticket.
Jim Porter is an attorney with Porter Simon licensed in California and Nevada, with offices in Truckee, Tahoe City and Reno. Jim's practice areas include: real estate, development, construction, business, HOAs, contracts, personal injury, mediation and other transactional matters. He may be reached at firstname.lastname@example.org or http://www.portersimon.com.