Thomas H. Cho v. Dept. Prof. Real Estate ( 1996 )

COURT OF APPEALS OF VIRGINIA
Present: Judges Bray, Annunziata and Overton
THOMAS H. CHO
AND
KIL JA CHO
MEMORANDUM OPINION *
v. Record No. 0301-96-4 PER CURIAM
JULY 30, 1996
DEPARTMENT OF PROFESSIONAL AND
OCCUPATIONAL REGULATION REAL ESTATE BOARD
AND SOON OK SARRAZIN
FROM THE CIRCUIT COURT OF FAUQUIER COUNTY
William Shore Robertson, Judge
(Daniel M. O'Connell, Jr.; O'Connell &
Mayhugh, on briefs), for appellants.
(James S. Gilmore, III, Attorney General;
Richard B. Zorn, Senior Assistant Attorney
General, on brief), for appellee Department
of Professional and Occupational Regulation
Real Estate Board.
No brief for appellee Soon Ok Sarrazin.
Thomas H. Cho and Kil Ja Cho appeal the decision of the
circuit court. The circuit court affirmed the decision of the
Department of Professional and Occupational Regulation Real
Estate Board (Real Estate Board) awarding appellants $20,000 on
their claim filed pursuant to the Virginia Real Estate
Transaction Recovery Act (Act), Code §§ 54.1-2112 through
54.1-2120. Appellants' issues are summarized as follows: (1)
whether the circuit court erred in finding that the decision-
*
Pursuant to Code § 17-116.010 this opinion is not
designated for publication.
making procedures of the Real Estate Board did not violate due
process; (2) whether the circuit court erred in ruling that the
factual determinations made by the Real Estate Board were
supported by evidence; (3) whether the circuit court erred in
finding that the Real Estate Board did not violate the applicable
statutes; and (4) whether the circuit court erred in not
remanding to the Real Estate Board appellants' request for
attorney's fees. Upon reviewing the record and briefs of the
parties, we conclude that this appeal is without merit.
Accordingly, we summarily affirm the decision of the trial court.
Rule 5A:27.
Under the Virginia Administrative Process Act, judicial
review of agency decisions is limited to determining whether the
agency acted in accordance with the law, made a procedural error
which was not harmless, and had sufficient evidence to support
its findings of fact. Johnston-Willis, Ltd. v. Kenley, 6 Va.
App. 231, 242, 369 S.E.2d 1, 7 (1988). See Code § 9-6.14:17. "A
court may not merely substitute its judgment for that of an
administrative agency." Jackson v. W., 14 Va. App. 391, 400, 419
S.E.2d 385, 390 (1992).
Due Process
Appellants allege they were deprived of due process because
they were not permitted to participate in and respond to the
deliberations of the Real Estate Board. We disagree. The key
components of due process are notice and an opportunity to be
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heard. Moore v. Smith, 177 Va. 621, 626, 15 S.E.2d 48, 49
(1941). The record demonstrates that appellants had notice and
numerous opportunities, which they used, to submit their claims
and supporting documents to the Real Estate Board and to respond
to allegations presented by Soon Ok Sarrazin's counsel. The
basis of the Real Estate Board's decision was set out in its
final order. Appellants appealed both the factual findings and
the legal conclusions contained in that order. Accordingly, the
record demonstrates no denial of due process.
Appellants also assert that the Real Estate Board improperly
closed its session in violation of the Virginia Freedom of
Information Act. See Code § 2.1-344(7). The minutes of the
meeting demonstrate that the meeting was recessed into closed
executive session for authorized purposes regarding specifically
designated agenda items. See City of Danville v. Laird, 223 Va.
271, 275-76, 288 S.E.2d 429, 431 (1982); Nageotte v. Board of
Supervisors, 223 Va. 259, 266-67, 288 S.E.2d 423, 426 (1982);
Marsh v. Richmond Newspapers, Inc., 223 Va. 245, 254-55, 288
S.E.2d 415, 420 (1982). The minutes contradict appellants'
allegation. Therefore, appellants have failed to demonstrate any
violation of Code § 2.1-344(7).
Sufficiency of the Evidence
On appeal, the "sole determination as to factual issues is
whether substantial evidence exists in the agency record to
support the agency's decision." Johnston-Willis, 6 Va. App. at
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242, 369 S.E.2d at 7.
The "substantial evidence" standard, adopted
by the General Assembly, is designed to give
great stability and finality to the fact-
findings of an administrative agency. The
phrase "substantial evidence" refers to "such
relevant evidence as a reasonable mind might
accept as adequate to support a conclusion."
Under this standard, applicable here, the
court may reject the agency's findings of
fact "only if, considering the record as a
whole, a reasonable mind would necessarily
come to a different conclusion."
Virginia Real Estate Comm'n v. Bias, 226 Va. 264, 269, 308 S.E.2d
123, 125 (1983) (citations omitted).
In their filings with the Real Estate Board, appellants
alleged that they suffered losses arising from four separate
transactions with Sarrazin. However, in the circuit court action
which resulted in the $60,000 award upon which their verified
claim was based, appellants alleged only two transactions. In
the first count of their Amended Motion for Judgment filed in
that action, appellants asserted a claim arising from their
payment of $60,000 to Sarrazin as a commission for her assistance
in obtain financing for the purchase of the Warrenton Motor
Lodge. In the second count, appellants sought additional damages
resulting from Sarrazin's fraudulent practices in connection with
appellants' purchase of the Hillcrest Motel. The amended motion
did not assert any claims arising from the sale of the option on
the Warrenton Motor Lodge or from the listing of the Hillcrest
Motel. Moreover, appellants' affidavit dated April 12, 1994,
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stated that
we filed a claim against [Sarrazin] in the
Circuit Court of Fauquier County for fraud in
connection with the sale to these affiants of
the Hillcrest Hotel and Restaurant based upon
the fraud of [Sarrazin], a Virginia licensed
real estate agent, in said sale.
No other allegations were set out in this affidavit.
In its final order, the Real Estate Board ruled that there
were two claims before it. The record as a whole does not
necessarily lead us to a different conclusion. Therefore, we
affirm the circuit court's decision that the findings of the Real
Estate Board are supported by substantial evidence in the record.
Statutory Claims
Appellants allege that, under Code § 54.1-2116(B), they were
entitled to recover up to $20,000 per transaction, and that the
Real Estate Board and the circuit court erred by interpreting the
section to limit their recovery from the Virginia Real Estate
Transaction Recovery Fund (Fund) for a single judgment to
$20,000. Appellants have failed to demonstrate that the Real
Estate Board's decision was erroneous as a matter of law.
Under Code § 54.1-2114, recovery from the Fund under the Act
is limited to instances "involving the sale, lease, or management
of real property by the regulant acting in the capacity of a real
estate broker or real estate salesperson and not in the capacity
of a principal, or on his own account." Code § 54.1-2114(A). A
"real estate salesperson" is defined as
any person who for compensation or valuable
consideration is employed either directly or
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indirectly by, or affiliated as an
independent contractor with, a real estate
broker, to sell or offer to sell, or to buy
or offer to buy, or to negotiate the
purchase, sale or exchange of real estate, or
to lease, rent or offer for rent any real
estate, or to negotiate leases thereof, or of
the improvements thereon.
Code § 54.1-2101. The Real Estate Board ruled that Sarrazin was
not acting as a real estate licensee when she received a
commission from appellants in exchange for her promise to obtain
financing for their purchase of the Warrenton Motor Lodge.
"[W]here the question involves an interpretation which is within
the specialized competence of the agency and the agency has been
entrusted with wide discretion by the General Assembly, the
agency's decision is entitled to special weight in the courts."
Johnston-Willis, 6 Va. App. at 244, 369 S.E.2d at 8. "On review,
'the interpretation which an administrative agency gives its
[law] must be accorded great deference.'" Jackson, 14 Va. App.
at 400-01, 419 S.E.2d at 390. We cannot say that the Real Estate
Board's interpretation excluding recovery from the Fund for
Sarrazin's fraudulent promises to obtain financing for appellants
was erroneous as a matter of law.
Code § 54.1-2116, entitled "Limitations upon recovery from
fund," provides in pertinent part as follows:
B. The maximum claim of one claimant against
the fund based upon an unpaid judgment
arising out of the improper or dishonest
conduct of one regulant in connection with a
single transaction involving the sale, lease,
or management of real property, shall be
limited to $20,000, regardless of the number
of claimants and regardless of the amount of
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the unpaid judgment of the claimant.
Code § 54.1-2116. Appellants' presented a single judgment from a
single recoverable transaction. Neither subsection (A), which
authorizes recovery from the Fund of up to $50,000 for multiple
judgments from a single claim, or subsection (C), which
authorizes recovery of up to $100,000 for multiple judgments from
multiple transactions, apply to appellants' claim.
Attorney's Fees
Appellants also sought attorney's fees in the amount of
$14,176.45. Code § 54.1-2116(D) provides that "[t]he claim
against the fund may include court costs and attorneys' fees."
However, Code § 54.1-2116(B) limited appellants' maximum claim to
$20,000. Appellants were compensated to the full extent
authorized by the statute. Therefore, the Real Estate Board did
not err by limiting appellants' recovery to $20,000.
Our resolution of these issues moots the additional
questions raised by appellants. Accordingly, the decision of the
circuit court denying appellants' appeal from the Real Estate
Board is summarily affirmed.
Affirmed.
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