Miller v. Dept. of Real Estate

Filed 10/17/22
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
EVERET GORDON MILLER et B311510
al.,
(Los Angeles County
Plaintiffs and Appellants, Super. Ct. No. 19STCP00490)
v.
DEPARTMENT OF REAL
ESTATE et al.,
Defendants and
Respondents.
APPEAL from a judgment of the Superior Court of
Los Angeles County, Mary H. Strobel, Judge. Affirmed.
Klinkert, Gutierrez & Neavel, James E. Klinkert, Paul J.
Gutierrez and Kelly J. Neavel for Plaintiffs and Appellants.
Rob Bonta, Attorney General, Tamar Pachter, Senior
Assistant Attorney General, Brian D. Wesley, Supervising
Deputy Attorney General, and Anna Barsegyan, Deputy Attorney
General, for Defendants and Respondents.
INTRODUCTION
Nijjar Realty, Inc. and its real estate broker of record,
Everet Miller, operated a mobilehome park owned by one of
Nijjar’s clients. The Department of Real Estate filed an
accusation alleging Nijjar violated various provisions of the Real
Estate Law (Bus. & Prof. Code, § 10000 et seq.),1 the Health and
Safety Code, and administrative regulations under the Health
and Safety Code by (1) employing an unlicensed individual to
solicit and enter into lease-to-own agreements with the
tenants/buyers of several mobilehomes; and (2) permitting the
tenants/buyers to move into mobilehomes that were not
permitted for human occupancy. Following a hearing, an
administrative law judge ruled Nijjar violated the statutes and
regulations. The administrative law judge issued a proposed
order revoking Nijjar Realty’s and Miller’s licenses, which the
Department adopted.
Nijjar and Miller filed a petition for a writ of
administrative mandate, contending they did not receive a fair
hearing because the administrative law judge considered
improper evidence, including expert testimony from several
witnesses the Department did not designate as experts. Nijjar
and Miller also contended the administrative law judge erred in
ruling they violated statutes in the Business and Professions
Code and the Health and Safety governing the sale and
occupancy of mobilehomes.
The trial court denied the petition, ruling that the
administrative law judge did not consider any improper evidence
1 Undesignated statutory references are to the Business and
Professions Code.
2
and, after conducting an independent review of the evidence, that
Nijjar and Miller violated the applicable statutes. Nijjar and
Miller appeal, making the same arguments they made in the trial
court. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
A. The Department Files an Accusation Against Nijjar
and Miller
Nijjar maintained and managed the Four J’s Trailer Park
in Oildale, California. A separate entity, Cobra 28 No. 7, LP,
owned the mobilehome park. In 2018 the Department filed an
accusation against Nijjar and Miller. The Department alleged, as
relevant here, Nijjar violated two provisions of the Real Estate
Law: (1) section 10137, which prohibits a broker from retaining
and compensating a person who acts as a broker without a
license (§§ 10130-10131.4, 10137), and (2) section 10131.6,
subdivision (b), which prohibits a real estate broker from
maintaining a place of business “where two or more . . .
mobilehomes are displayed and offered for sale” by the broker
unless the broker also has a mobilehome dealer license issued by
the Department of Housing and Community Development (HCD)
(§ 10136, subd. (d); see Health & Saf. Code, § 18000, et seq.). The
Department alleged Nijjar violated these statutes by “employ[ing]
and compensate[ing]” Jose Rodriguez, an unlicensed person, to
represent the seller of mobilehomes at the park in three separate
“lease to own agreement[s].” The Department also alleged Nijjar,
in violation of several provisions of the Health and Safety Code
and related HCD regulations, “allowed immediate residential
occupancy” of several mobilehomes at the park that were “not
3
authorized for human occupancy,” including those offered in the
lease-to-own agreements.
B. The Administrative Law Judge Conducts a Hearing
1. Nijjar and Miller File a Motion To Exclude the
Department’s Evidence, Which the
Administrative Law Judge Denies
Prior to the hearing, the administrative law judge issued a
conference order requiring the Department and Nijjar and Miller
to file and exchange witness and exhibit lists 19 days before the
hearing. The order stated that, “at the discretion of the
Administrative Law Judge, failure to comply . . . shall be grounds
to exclude exhibits from evidence and to bar witnesses from
testifying.”
The Department filed a prehearing statement identifying
potential witnesses and exhibits, but did not file a final witness
and exhibit list until five days before the hearing. Nijjar and
Miller filed a motion asking the administrative law judge to
preclude the Department from “offering any exhibits” or “offering
the testimony of any witnesses” during the hearing (effectively, a
terminating sanction), or in the alternative, to prohibit the
Department from introducing any expert opinion testimony. The
administrative law judge denied the motion because (1) the
Department in its prehearing statement had given Nijjar and
Miller copies of all the documents it intended to use as exhibits
and identified its witnesses and (2) the Department represented
to the administrative law judge that none of its witnesses would
offer expert opinion testimony.
4
Nijjar and Miller filed a separate motion to exclude
evidence that, after Rodriguez executed the lease-to-own
agreements with the tenant/buyers of the mobilehomes, one of
the mobilehomes caught fire, killing an infant. The
administrative law judge denied the motion because the
Department represented it only intended to show that the fire
“brought the state agencies . . . to the site,” not that Nijjar caused
the fire.
2. The Department Presents Evidence That
Residents Occupied Unpermitted Mobilehomes
The HCD, in addition to issuing mobilehome dealer
licenses, generally regulates the operation of mobilehome parks.
(See Health & Saf. Code, § 18200 et seq.) Robert Martinez, a
representative of the Codes and Standards Division of the HCD,
testified that in 2015 Four J’s obtained permits to install certain
electrical infrastructure at the park, before installing any
mobilehomes. In January 2016, however, Martinez inspected the
park and “discovered people living in some mobile home units
that had not undergone an inspection,” and for which no one had
applied for permits. Martinez issued Nijjar a “Notice of
Violation” that stated seven mobile homes had been installed
without a permit and that instructed Nijjar to correct the
violations. Miller admitted at the hearing he “did not know . . .
one way or the other” whether the mobilehomes were permitted
for human occupancy.
About three weeks after Martinez inspected the park, one
of the unpermitted mobilehomes caught fire. Martinez inspected
the park again and found the mobilehome that caught fire was
“completely destroyed.” An adjacent mobilehome was also
5
“totally” destroyed, and another was “partially” destroyed.
Martinez issued Nijjar a new notice of violation, stating that the
remaining mobilehomes “shall be vacated immediately” and that
“the mobilehome units shall not be occupied until . . . inspected
and approved for occupancy . . . .”
3. The Department Presents Evidence of the Lease-
to-own Agreements
George Jediny, an investigator for the HCD, interviewed
Rodriguez at the park in February 2016. Rodriguez told Jediny
that Nijjar employed him as the manager of Four J’s Trailer
Park.
The Department submitted three contracts Rodriguez
executed in the fall of 2015 on behalf of Nijjar. Each contract
designated Nijjar as the “Landlord” and the other party as the
“Tenant.” The contracts included a form titled “Rental Lease
Agreement with Option To Purchase,” which stated the tenants
would pay Nijjar $325 a month “as rent for the Premises . . . .”
The form also included a provision, under the heading “Option to
Purchase,” which stated Nijjar “grant[ed] Tenant the exclusive
right to an option to purchase the Premises” for a price (either
$7,000 or $10,000, depending on the contract), beginning with the
term of the lease and expiring upon termination of the lease. The
provision also stated that the tenant would “deposit with [Nijjar]
the sum of $1,000 as a deposit towards the purchase price of the
Premises” and that the tenant would pay a certain amount each
month (either $150 or $325), “which include[d] principal and
interest at 10% annum, on the unpaid balance . . . .” During
their interview, Rodriguez explained to Jediny that the tenants
paid $325 a month to rent the space in the mobilehome park and
6
for utilities, plus an additional sum toward the principal on the
mobilehome.
Ernie Ruiz, an investigator for the Department of Real
Estate, also interviewed Rodriguez. Rodriguez described for Ruiz
the process he followed in obtaining tenants for the lease-to-own
agreements. If a prospective tenant was interested in a
mobilehome, Rodriguez would inform the tenant it was “available
for sale” and give the tenant the keys to the mobilehome. The
tenant would then look at the mobilehome, although Rodriguez
said he “wouldn’t actually physically show” it. If the tenant
wanted the mobilehome, Rodriguez would fax the tenant’s credit
application to his supervisors at Nijjar, who would decide
whether to approve the application.
Jediny testified Rodriguez did not have a license issued by
the HCD (i.e., a mobilehome dealer license), and Ruiz testified
Rodriguez did not have a license issued by the Department of
Real Estate. Ruiz also stated Nijjar and Miller had licenses
issued by the Department of Real Estate but not by the HCD.
Miller admitted at the hearing Nijjar did not have a license
issued by the HCD because, according to Miller, “[n]one was
required.”
4. The Administrative Law Judge Rules Nijjar
Violated the Applicable Statutes, and the
Department Revokes Nijjar’s Licenses
The administrative law judge found that, at all relevant
times, Nijjar “operated and managed” the Four J’s Trailer Park
and “employed Rodriguez as the on-site manager” of the park.
The administrative law judge found Nijjar, through Rodriguez,
“represented the seller” of a mobilehome at the park on three
7
separate occasions where mobilehomes “were leased with an
option of ownership after [the tenants] had paid off the principal
balance.”2 Therefore, the administrative law judge ruled, Nijjar
“employed and compensated unlicensed Rodriguez, to perform
real estate activities . . . in violation of section 10137.” The
administrative law judge further found Nijjar “sold more than
two mobilehomes in the same park without possessing a dealer
license . . . in violation of section 10131.6, subdivision (b).”
Finally, the administrative law judge found Nijjar did not
have the “installation and occupancy” permits required by several
provisions of the Health and Safety Code and related HCD
regulations. The administrative law judge rejected Nijjar and
Miller’s contention that only the “owner” of the mobilehomes
could be held liable for the permit violations, ruling Nijjar was
liable because it acted as “on-site management of the Park,
including allowing the unpermitted homes to be occupied . . . and
selling [the] mobilehomes.”
The administrative law judge ruled that, in light of Nijjar’s
violations, there was sufficient cause under the Real Estate Law
to revoke Nijjar’s and Miller’s licenses. (See §§ 10176, subd. (m),
10177, subds. (d), (g), & (h).) The administrative law judge
concluded it was appropriate to revoke the licenses because Nijjar
and Miller “did not take any responsibility for the unlicensed sale
and occupancy of mobilehomes at the park” and presented no
evidence they had implemented any policies or procedures that
2 When Rodriguez executed the lease-to-own agreements,
each mobilehome had a registered owner different from Nijjar.
The trial court ruled it was “unclear based on the evidence
presented at hearing who were the owners of the individual
mobilehomes . . . .”
8
would prevent similar violations in the future. The commissioner
adopted the administrative law judge’s findings and order and
revoked Nijjar’s and Miller’s licenses.
C. Nijjar and Miller File a Petition for Writ of
Administrative Mandate, Which the Trial Court
Denies
Nijjar and Miller filed a petition for writ of administrative
mandate arguing, as relevant here, the administrative law judge
and the Department erred in several ways. First, they contended
they did not receive a fair hearing because Martinez, Jediny, and
Ruiz gave expert opinion testimony, even though the Department
did not designate them as expert witnesses. Second, Nijjar and
Miller argued the administrative law judge erred in ruling Nijjar
violated the Real Estate Law by employing Rodriguez to execute
the lease-to-own agreements because, according to Nijjar and
Miller, the contracts “were leases, not sales agreements,” and the
law did not prohibit an unlicensed person from “accept[ing]” lease
agreements on behalf of Nijjar. Third, Nijjar and Miller
contended the administrative law judge erred in ruling Nijjar
violated the provisions of the Health and Safety Code and HCD
regulations requiring mobilehomes to be permitted for human
occupancy because, again according to Nijjar and Miller, only the
owner of a mobilehome or mobilehome park is liable for failing to
obtain the required permits. Finally, Nijjar and Miller argued
that the administrative law judge erred in admitting evidence of
the fire that killed the infant and that the Department “obviously
based its decision” to revoke Nijjar’s and Miller’s licenses “on its
subjective belief in the unproven allegation that [they] caused the
death of an infant.”
9
The trial court denied the petition. The court ruled Nijjar
and Miller received a fair hearing because Martinez, Jediny, and
Ruiz did not give expert opinion testimony—they gave testimony
based only on their perceptions as investigators. The court also
ruled that, even if the witnesses offered some expert opinion
testimony, the administrative law judge’s rulings were based on
the non-opinion testimony and on her independent legal
conclusions about the applicable statutes and regulations, and
Nijjar and Miller had sufficient notice of the expected testimony
and an opportunity to respond.
Next, the court conducted an independent review of the
record, concluded the weight of the evidence supported the
administrative law judge’s finding the contracts were lease-to-
own agreements, and ruled Nijjar violated section 10131.6,
subdivision (b), and section 10137 by allowing Rodriguez to sign
the contracts without a license. The court also ruled that the
weight of the evidence supported the administrative law judge’s
finding Nijjar “allowed unpermitted residential occupancy of the
[p]ark’s mobilehomes” and that the applicable law did not impose
the obligation to obtain a permit for human occupancy “solely on
the owner of the mobile home.” Finally, the trial court rejected
Nijjar and Miller’s assertion the administrative law judge
improperly admitted or based its decision on the fact a fire in one
of the mobilehomes killed an infant. The court stated that the
Department did not charge Nijjar or Miller with causing the fire
and that the administrative law judge “made no finding about
causation.” Nijjar and Miller timely appealed from the judgment
denying the petition.
10
DISCUSSION
A. Applicable Law and Standard of Review
“Before suspending or revoking a license,” the Department
must hold a formal hearing under the Administrative Procedures
Act. (§ 10100; see Gov. Code, § 11500 et seq.) An aggrieved
licensee may file a petition for a writ of administrative mandate
to challenge the Department’s decision to suspend or revoke a
real estate license. (See Code Civ. Proc. § 1094.5; Singh v. Davi
(2012) 211 Cal.App.4th 141, 147; Amvest Mortgage Corp. v. Antt
(1997) 58 Cal.App.4th 1239, 1242-1243.) “‘“The question
presented by a petition for writ of administrative mandate is
whether the agency or tribunal that issued the decision being
challenged ‘proceeded without, or in excess of, jurisdiction;
whether there was a fair trial; and whether there was any
prejudicial abuse of discretion. . . . [A]buse of discretion is
established if the respondent has not proceeded in the manner
required by law, the order or decision is not supported by the
findings, or the findings are not supported by the evidence.’”’”
(Tran v. County of Los Angeles (2022) 74 Cal.App.5th 154, 206;
see Doe v. University of Southern California (2018)
28 Cal.App.5th 26, 34.)
B. Nijjar and Miller Received a Fair Hearing
For purposes of section 1094.5, “‘[t]he “fair trial”
requirement is equivalent to a prescription that there be
a fair administrative hearing.’” (Mountainlands Conservancy,
LLC v. California Coastal Com. (2020) 47 Cal.App.5th 214, 235;
accord, Sweeney v. California Regional Water Quality Control Bd.
(2021) 61 Cal.App.5th 1093, 1143; Lateef v. City of Madera (2020)
11
45 Cal.App.5th 245, 252.) “Because the ultimate determination
of procedural fairness presents a question of law, we ‘review the
fairness of the administrative proceeding de novo.’” (Sweeney, at
p. 1143; see Sinaiko v. Superior Court (2004) 122 Cal.App.4th
1133, 1140 [we “independently review the fairness of the
administrative proceedings as a question of law”].)
Nijjar and Miller argue they did not receive a fair hearing
for two reasons: (1) the administrative law judge allowed the
Department’s three witnesses, Martinez, Jediny, and Ruiz, to
give expert opinion testimony, and (2) the Department’s decision
to revoke Nijjar’s and Miller’s licenses was based on the
Department’s belief they caused the fire, not on the evidence the
Department presented at the hearing. Neither contention has
merit.
1. The Testimony by Martinez, Jediny, and Ruiz
Did Not Deprive Nijjar of a Fair Hearing
Nijjar and Miller contend they did not receive a fair
hearing because, while the Department “did not properly identify
any expert witnesses” prior to the hearing and represented at the
hearing that “no expert opinion testimony would be offered,” the
testimony of all three witnesses—Martinez, Jediny, and Ruiz—
“went far beyond permissible lay witness opinion.” Nijjar and
Miller primarily object to testimony by each witness that Nijjar
violated the HCD’s or Department of Real Estate’s licensing
requirements, and testimony by Ruiz that the lease-to-own
agreements were “sales” agreements. Nijjar and Miller assert
the admission of this testimony was “a denial of due process.”
As an initial matter, Nijjar and Miller cite the wrong legal
standard governing their contentions. They cite authority
12
governing the admissibility of opinions by non-expert witnesses
in civil and criminal trials and assume the same rules apply in
administrative proceedings. They don’t. As the trial court
correctly observed, a hearing under the Administrative Procedure
Act “need not be conducted according to technical rules relating
to evidence and witnesses,” unless expressly required by the Act.
(Gov. Code, § 11513, subd. (c); see McCoy v. Board of Retirement
(1986) 183 Cal.App.3d 1044, 1054 [“[a]n administrative agency is
not required to observe the strict rules of evidence enforced in the
courts”].) In particular, the APA, unlike the Code of Civil
Procedure, does not prohibit a witness from providing expert
opinion testimony on the ground the proponent of the testimony
did not timely exchange with the opposing party certain
information about the witness. (Cf. Code Civ. Proc., § 2034.300).3
Instead, in administrative hearings “[a]ny relevant evidence shall
be admitted if it is the sort of evidence on which responsible
persons are accustomed to rely in the conduct of serious affairs,
regardless of the existence of any common law or statutory rule
which might make improper the admission of the evidence over
objection in civil actions.” (Gov. Code, § 11513, subd. (c).) Nijjar
and Miller do not present any argument why, even assuming
Martinez, Jediny, and Ruiz gave some expert opinion testimony,
their testimony was the type of testimony responsible persons are
3 The APA does have a provision authorizing the
administrative law judge to address the exchange of witness lists
and exhibits during a prehearing conference, as the
administrative law judge did here, but nothing requires the
administrative law judge to exclude a witness’s testimony if a
party fails to comply with a prehearing order. (See Gov. Code,
§ 11511.5.)
13
not accustomed to rely on. Nor do Nijjar and Miller cite any
other provision of the APA that would preclude the
administrative law judge from considering such testimony.4
Even if some of the challenged testimony amounted to
expert opinion testimony, the administrative law judge did not
violate Nijjar’s or Miller’s due process rights. “‘The essence of
due process is the requirement that “a person in jeopardy of
serious loss [be given] notice of the case against and opportunity
to meet it.”’ [Citations.] The opportunity to be heard must be
afforded ‘at a meaningful time and in a meaningful manner.’”
(Today’s Fresh Start, Inc. v. Los Angeles County (2013) 57 Cal.4th
197, 212 (Today’s Fresh Start).) To identify “‘“the quantum and
quality of the process due in a particular situation”’ . . . the
United States Supreme Court in [Mathews v. Eldridge (1976) 424
U.S. 319, 335, [96 S.Ct. 893, 47 L.Ed.2d 18] (Mathews)]”
identified three factors courts must balance: “‘First, the private
interest that will be affected by the official action; second, the
risk of an erroneous deprivation of such interest through the
procedures used, and the probable value, if any, of additional or
substitute procedural safeguards; and finally, the Government’s
interest, including the function involved and the fiscal and
4 One court has held that a party to an administrative
proceeding who seeks to introduce expert opinion testimony
based on a new scientific method of proof must satisfy the
requirements of People v. Kelly (1976) 17 Cal.3d 24 and Frye v.
United States (D.C. Cir. 1923) 293 F. 1013 by showing the
procedure has been generally accepted as reliable in the
scientific community in which it was developed. (See Seering v.
Department of Social Services (1987) 194 Cal.App.3d 298, 311.)
None of the witnesses’ testimony here was based on a scientific
method or procedure.
14
administrative burdens that the additional or substitute
procedural requirement would entail.’” (Today’s Fresh Start, at
pp. 212-213.) California courts “also consider a fourth factor, the
‘“dignitary interest in informing individuals of the nature,
grounds, and consequences of the action and in enabling them to
present their side of the story before a responsible government
official.”’” (Id. at p. 213)
Nijjar and Miller do not discuss any of the Mathews factors
or cite any other authority governing when an administrative
agency violates a person’s or entity’s due process rights; as
discussed, Nijjar and Miller cite only authority governing when a
witness may give opinion testimony in civil and criminal trials.
For that reason alone, they have not shown a due process
violation. (See Mathews v. Eldridge, supra, 424 U.S. at pp. 348-
349 [“The judicial model of an evidentiary hearing is neither a
[constitutionally] required, nor even the most effective, method of
decisionmaking in all circumstances.”]; Mohielf v. Janovici (1996)
51 Cal.App.4th 267, 288 [same].)
In any event, there was no due process violation. Under
the first Mathews factor, Nijjar and Miller certainly had a
significant interest in retaining their real estate license and were
entitled to a number of procedural protections before the
Department could revoke them. But Nijjar and Miller have not
shown how the Department’s failure to designate Martinez,
Jediny, and Ruiz as expert witnesses prior to the hearing
seriously “risk[ed] . . . an erroneous deprivation of such interest.”
(Today’s Fresh Start, supra, 57 Cal.4th at p. 213; see Acott
Ventures, LLC v. Alcoholic Bev. Control Bd. (D.C.Ct.App. 2016)
135 A.3d 80, 90 [“In accordance with the relaxed rules on the
admissibility and competence of evidence, . . . opinion testimony
15
may be admitted at an administrative hearing with or without a
witness’s formal and fully supported certification as an expert
and may be considered as the agency reasonably deems
appropriate in making its findings and conclusions on contested
matters.”].) And Nijjar and Miller received numerous procedural
protections. For example, although the Department did not
formally designate the witnesses as experts, in its prehearing
conference statement filed six weeks before the hearing, the
Department identified them as witnesses it intended to call and
described their expected testimony. The Department stated that
Martinez and Jediny would “testify about the inspections,
reports, and actions taken by HCD” and that Ruiz would testify
about the evidence obtained during the Department of Real
Estate’s investigation. The Department also identified as an
exhibit a report authored by Jediny. In the report Jediny
referred to and described the notices of violation Martinez issued
to Nijjar (which Martinez testified about at the hearing) and
described in detail Nijjar’s violations of the HCD’s licensing
requirements, which Jediny testified about.
Nijjar and Miller had the opportunity to and did cross-
examine each of the witnesses. And the administrative law judge
allowed Nijjar and Miller’s expert witness to testify about how
Nijjar’s conduct did not violate the applicable licensing
provisions. The trial court correctly ruled Nijjar and Miller had
sufficient notice of the witnesses’ anticipated testimony and a
reasonable opportunity to respond. That is all due process
requires. (See Mathews, supra, 424 U.S. at p. 349 [“All that is
necessary is that the procedures be tailored, in light of the
decision to be made, to ‘the capacities and circumstances of those
who are to be heard’ [citation] to insure that they are given a
16
meaningful opportunity to present their case.”]; Mohielf v.
Janovici, supra, 51 Cal.App.4th at p. 289 [same].)
Finally, any error in admitting the testimony Nijjar and
Miller complain about was harmless. “‘[I]t is well-settled that the
improper admission or rejection of evidence at an administrative
hearing does not provide “grounds for reversal unless the error
has resulted in a miscarriage of justice. [Citation.] In other
words, it must be reasonably probable a more favorable result
would have been reached absent the error.”’” (Thornbrough v.
Western Placer Unified School Dist. (2013) 223 Cal.App.4th 169,
200; see Lone Star Security & Video, Inc. v. Bureau of Security &
Investigative Services (2009) 176 Cal.App.4th 1249, 1255.) Any
such error “‘“is not prejudicial if the evidence ‘was merely
cumulative or corroborative of other evidence properly in the
record,’ or if the evidence ‘was not necessary, the judgment being
supported by other evidence.’”’” (Lone Star Security, at pp. 1254-
1255; see McCoy v. Board of Retirement, supra, 183 Cal.App.3d at
p. 1054.)
As discussed, Nijjar and Miller primarily object to
testimony by Martinez, Jediny, and Ruiz that Nijjar violated the
HCD’s and Department of Real Estate’s licensing requirements
and testimony by Ruiz that the lease-to-own agreements were
“sales.” The testimony was not necessary to the judgment
because the trial court independently considered the evidence on
which those opinions were based; the language of the lease-to-
own agreements and Rodriguez’s admissions about their terms;
Rodriguez’s admission to Jediny that he did not have a license
issued by either the Department or the HCD; Miller’s admission
at the hearing he did not have a license issued by the HCD; and
17
Martinez’s testimony no one applied to the HCD for occupancy
permits for the mobilehomes.5
2. The Evidence of the Fire Did Not Deprive Nijjar
and Miller of a Fair Hearing
Nijjar and Miller next contend that, although “the
administrative hearing ostensibly had nothing to do” with the fire
in the mobilehome that killed the infant, the Department
“obviously” revoked Nijjar’s and Miller’s licenses because of its
“subjective belief in the unproven allegation that [they] caused
the death . . . .” In its closing brief in the administrative hearing,
the Department did argue Nijjar’s and Miller’s “complete
disregard for all Health and Safety Code statutes and regulations
. . . led to the death of an infant.” And in a memorandum of
points and authorities filed in the trial court in opposition to
Nijjar and Miller’s request to stay the administrative law judge’s
decision, the Department argued Nijjar’s and Miller’s “bad acts
5 Nijjar and Miller also object to two other pieces of evidence
they characterize as expert opinion testimony. This first was
testimony by Martinez and Jediny about the difference between
mobilehomes and recreational vehicles. There was no dispute,
however, the units were mobilehomes. When examined by the
Department’s lawyer at the hearing, Miller agreed the units were
“mobilehomes” that “were leased and occupied.” The second was
testimony by Jediny that the mobilehomes were in “substandard”
condition. Neither the trial court nor the administrative law
judge, however, found Nijjar violated any statutes or regulations
because the mobilehomes were in substandard condition.
18
caused the death of a five-month-old baby, plus the incineration
of three mobilehomes.”
But even if the Department’s decision to revoke Nijjar’s and
Miller’s licenses was partially motivated by its belief Nijjar and
Miller had some responsibility for the fire, Nijjar and Miller
would still not be entitled to reversal of the judgment.
Generally, “judicial comity and restraint preclude us from
speculating about any ulterior motives [an agency] may have had
in reaching its decision.” (San Diego Housing Com. v. Public
Employment Relations Bd. (2016) 246 Cal.App.4th 1, 12; see
Carter v. City of Los Angeles (1948) 31 Cal.2d 341, 350 [in former
employees’ petition for writ of mandate seeking
reinstatement,“[i]nquiry into extraneous facts merely to
determine motive” of agency “would not be proper”]; Doe v. Allee
(2019) 30 Cal.App.5th 1036, 1060-1061 [where a university
student petitioned for a writ of administrative mandate to set
aside his expulsion, “‘mere belief that [a school official] acted with
. . . ulterior motives [was] insufficient to state a claim for
relief’”].) Regardless of the Department’s motives, Nijjar and
Miller received a fair trial. The Department did not attempt to
show during the administrative hearing or in the trial court that
Nijjar’s or Miller’s conduct caused the fire. Each of the
Department’s witnesses mentioned only briefly, as a background
fact to explain the witness’s investigation, that the fire occurred
or that the infant died. None of the witnesses stated Nijjar’s
violations of the applicable statutes or regulations caused the fire
or the death.
Moreover, the administrative law judge did not base her
decision to revoke Nijjar’s and Miller’s licenses on the fire or the
infant’s death. (See Pomona Valley Hospital Medical Center v.
19
Superior Court (1997) 55 Cal.App.4th 93, 107 [“evidence of [a
hospital’s] motive in initiating [a physician’s] suspension” was
“not relevant to the issue of whether [the physician] had a fair
administrative hearing”]; Cole v. Los Angeles Community College
Dist. (1977) 68 Cal.App.3d 785, 792 [community college’s
purported “improper motivation” in commencing a proceeding to
discharge an employee was irrelevant because “[i]t is the bias of
the tribunal deciding a case, not the bias of the person instituting
the proceeding that is important”].) The administrative law
judge’s stated grounds for revoking Nijjar’s and Miller’s licenses
were that they did not accept responsibility for their violations or
explain what policies they intended to adopt to prevent future
violations. Nijjar and Miller have not shown the administrative
law judge’s conclusion was based on anything else outside the
record. (Cf. Andrews v. Agricultural Labor Rel. Bd. (1981)
28 Cal.3d 781, 792 [“‘Bias and prejudice’” of a decisionmaker “‘are
never implied and must be established by clear averments’”];
Nick v. City of Lake Forest (2014) 232 Cal.App.4th 871, 887
[“administrative decision makers are . . . presumed to be
impartial”].)
C. Substantial Evidence Supported the Trial Court’s
Finding There Were Grounds To Revoke Nijjar’s and
Miller’s License
1. Standard of Review
“A trial court reviewing the administrative decision of the
Commissioner to revoke the license of a real estate broker . . .
must exercise its independent judgment on the evidence
underlying that decision and determine whether the
20
Commissioner’s findings are supported by the weight of the
evidence.” (California Real Estate Loans, Inc. v. Wallace (1993)
18 Cal.App.4th 1575, 1580; see Amvest Mortgage Corp. v. Antt,
supra, 58 Cal.App.4th at pp. 1242-1243.)6 Where, as here, “an
appeal is taken from the trial court’s determination” the weight
of the evidence supported the commissioner’s findings, “it is given
the same effect as any other judgment after trial rendered by the
court: the only question is whether the trial court’s (not the
administrative agency’s) findings are supported by substantial
evidence.” (Vaill v. Edmonds (1991) 4 Cal.App.4th 247, 258; see
Fukuda v. City of Angels (1999) 20 Cal.4th 805, 824; Wallace, at
p. 1580.) Whether the trial court’s findings support its legal
conclusions is an issue of law we review de novo. (County of
Fresno v. Fresno Deputy Sheriff’s Assn. (2020) 51 Cal.App.5th
282, 288; Holmes v. California Victim Compensation &
Government Claims Bd. (2015) 239 Cal.App.4th 1400, 1409;
Hi-Desert Medical Center v. Douglas (2015) 239 Cal.App.4th 717,
730.)
The Department revoked Nijjar’s and Miller’s licenses for
two categories of conduct: First, violating the Real Estate Law by
6 A trial court must “exercise[ ] its independent judgment
upon the evidence” when reviewing a final administrative
decision that substantially affects a fundamental vested right
. . . .” (Fukuda v. City of Angels (1999) 20 Cal.4th 805, 816, fn. 8;
see JMS Air Conditioning & Appliance Service, Inc. v. Santa
Monica Community College Dist. (2018) 30 Cal.App.5th 945, 964.)
“Because the right to continue one’s trade or profession is
fundamental” (Amvest Mortgage Corp. v. Antt, supra,
58 Cal.App.4th at pp. 1242-1243), a “real estate broker’s license is
a ‘vested’ right” (Milner v. Fox (1980) 102 Cal.App.3d 567, 571,
fn. 5).
21
retaining and compensating an unlicensed person, Rodriguez, to
enter into the lease-to-own agreements; second, violating the
Health and Safety Code and related HCD regulations by allowing
residents to occupy mobilehomes the HCD had not permitted for
human occupancy. Substantial evidence supported the trial
court’s findings that each category of conduct violated the
applicable laws and justified revoking the licenses.
2. Substantial Evidence Supported the Trial
Court’s Finding Nijjar Violated the Real Estate
Law
Section 10177 authorizes the commissioner of the
Department to revoke a license if the licensee “[w]illfully
disregarded or violated” the Real Estate Law (§ 10177, subd. (d)),
“[d]emonstrated negligence or incompetence in performing an act
for which the . . . person is required to hold a license” (§10177,
subd. (g)), or “failed to exercise reasonable supervision over the
activities of that licensee’s salespersons” or a corporation for
which the licensee is the designated broker (§ 10177, subd. (h)).
The administrative law judge ruled there were grounds to revoke
Nijjar’s and Miller’s licenses under section 10177 because Nijjar
violated section 10137. Section 10137 provides: “It is unlawful
for any licensed real estate broker to retain, compensate, directly
or indirectly, any person for performing any of the acts within the
scope of [Chapter 3 of the Real Estate Law] who is not a licensed
real estate broker, or a real estate salesperson licensed under the
responsible broker retaining or compensating him or her . . . .”
One of the acts within the scope of Chapter 3 is described in
section 10131.6, subdivision (a): “[A] person licensed as a real
estate broker may sell or offer to sell, . . . solicit prospective
22
purchasers of, . . . or negotiate the purchase, sale, or exchange of
any manufactured home or mobilehome,” subject to certain
limitations. The trial court found Nijjar violated section 10137
because it employed Rodriguez, who did not have a license, to
engage in the acts described in section 10131.6, subdivision (a).
Substantial evidence supported the trial court’s finding.
Rodriguez’s employment agreement with Nijjar reflected that
Nijjar paid him to act as the manager of the Four J’s Park.
Rodriguez admitted to Jediny he did not have a license issued by
the Department of Real Estate or the HCD. The Department
introduced three agreements Rodriguez executed, on behalf of
Nijjar, with a tenant/buyer. In each agreement Nijjar leased a
mobilehome to the tenant/buyer and purported to grant the
tenant/buyer an option to purchase the mobilehome for a
specified purchase price. Rodriguez also told Jediny that Nijjar
paid him a bonus for leasing all of the mobilehomes in the park.
In their appellate briefs, the parties focus on and dispute
whether Rodriguez, when he signed a lease-to-own agreement,
“sold” or merely “leased” a mobilehome. The trial court (as well
as the administrative law judge) characterized Rodriguez’s
conduct as “represent[ing] the sellers in the sale of mobilehomes.”
But the parties’ dispute over whether the agreement was for a
“sale” or a “lease” is beside the point. Section 10131.6,
subdivision (a), encompasses not just selling, but “offer[ing] to
sell” a mobilehome. Because each agreement included a form
titled “Rental Lease Agreement with Option To Purchase,” which
“grant[ed] Tenant the exclusive right to an option to purchase”
the mobilehome for a specified price, there is no question that,
regardless of whether Rodriguez actually sold mobilehomes, he
offered to sell them. Under California law, a “contract conferring
23
an option to purchase is an irrevocable and continuing
offer to sell.” (Dawson v. Goff (1954) 43 Cal.2d 310, 317; see
Steiner v. Thexton (2010) 48 Cal.4th 411, 418 [“an option to
purchase property is ‘a unilateral agreement,’” in which the
“‘optionor offers to sell the subject property at a specified price or
upon specified terms’”]; City of Orange v. San Diego County
Employees Retirement Assn. (2002) 103 Cal.App.4th 45, 58 [under
an option contract, the “‘optionor has irrevocably promised upon
the exercise of the option to perform the contract or make the
conveyance upon the terms specified in his binding offer”’];
Lawrence v. Settle (1960) 182 Cal.App.2d 386, 388 [“As respects
the purchase and sale of real property, an option is a unilateral
offer by the owners to a prospective buyer to sell to the buyer
within the time and under the conditions stated in the option.”].)7
Substantial evidence also supported the trial court’s finding
Nijjar violated section 10131.6, subdivision (b). That provision
7 Nijjar and Miller contend Rodriguez was exempt from the
license requirement under the exception in section 10131.01,
subdivision (a)(3)(E). Section 10131.01, subdivision (a)(3),
exempts an “employee of the property management firm retained
to manage a residential apartment building or complex or court”
from the general provision of the Real Estate Law that requires a
person to have a license to lease real property (see § 10131, subd.
(b)), if the employee only performs certain activities. One such
activity is “[a]ccept[ing] signed leases and rental agreements
from prospective tenants.” (§ 10131.01, subd. (a)(3)(E).) That
provision does not help Nijjar and Miller. Nijjar and Miller do
not cite any evidence or authority suggesting the Four J’s Park, a
mobilehome park (see Health & Saf. Code, § 18214), qualifies as a
residential apartment building, complex, or court. And even if it
did, subdivision (a)(3)(E) exempts only the employee of a property
24
states: “No real estate broker who engages in the activities
authorized by this section [i.e., selling or offering to sell a
mobilehome] shall maintain any place of business where two or
more manufactured homes or mobilehomes are displayed and
offered for sale by the person, unless the broker is also licensed as
a mobilehome dealer” by the HCD. Ruiz testified, and Miller
admitted, Nijjar did not have a license issued by the HCD. And as
discussed, Rodriguez acted on behalf of Nijjar when executing the
lease-to-own agreements.
We asked the parties under Government Code section
68081 to submit supplemental briefing on “whether Nijjar
violated the applicable provisions of the Business and Professions
Code because [it] “‘offered for sale’ . . . two or more mobile homes,
even if [it] did not sell two or more mobile homes.” In response,
Nijjar and Miller did not dispute that Nijjar offered to sell
mobilehomes or that the Department only had to show Nijjar
offered to sell mobilehomes (as opposed to actually selling them)
to establish the violations. Instead, Nijjar argued it did not
violate section 10131.6, subdivision (b), because it did not
“maintain a place of business” at the Four J’s Park.
There was substantial evidence, however, Nijjar
maintained a place of business at the park for purposes of section
10131, subdivision (b). The trial court found Nijjar “operate[d]
and manag[ed]” the park. Nijjar and Miller do not explain why
operating and managing a mobilehome park would not constitute
maintaining a place of business for purposes of the statute.
Moreover, the legislative history reflects that the purpose of
section 10131.6, subdivision (b), was to limit the circumstances in
manager accepting leases—not someone who is also offering to
sell property.
25
which a broker could offer multiple mobilehomes for sale. The
Legislative Analyst’s Analysis of Assembly Bill No. 2194—the
Bill that enacted section 10131 (see Stats.1974, ch. 1351, § 1)—
explained that, at the time, the existing law required “a person
selling mobilehomes [to] obtain a vehicle dealer’s license and
establish a place of business.” (Legis. Analyst, analysis of Assem.
Bill No. 2194 (1973-1974 Reg. Sess.) p. 86.) According to the
analysis, the bill “would authorize a real estate broker to engage
in the sale or purchase of certain mobilehomes which have been
registered with the Department of Motor Vehicles . . . without
having first obtained a vehicle dealer’s license,” but the “real
estate broker would not be permitted to display more than one
mobilehome for sale unless he is a licensed vehicle dealer.”
(Ibid.) To allow Nijjar to offer for sale multiple mobilehomes at
the same park, which Nijjar also operated and managed, would
be inconsistent with the purposes of section 10131 of allowing a
broker to sell a mobilehome, but not multiple ones at the same
time and place. (See Siskiyou County Farm Bureau v.
Department of Fish & Wildlife (2015) 237 Cal.App.4th 411, 442
[views of the Legislative Analyst “are both judicially noticeable
and at times persuasive indications of the Legislature’s views”
(italics omitted)].)
Nijjar and Miller argue that, in interpreting “place of
business” in section 10131, subdivision (b), we should adopt the
definition of “established place of business” under the
Manufactured Housing Act of 1980, the law that governs
mobilehome dealers. (See Health & Saf. Code, § 18000 et seq.)
In order to obtain a mobilehome dealer license, a person must
have an “established place of business,” which the Act defines as
“the place actually occupied, either continuously or at regular
26
periods, by a licensee, where the books and records pertinent to
the type of business being conducted are kept.” (Id., § 18003.6;
see § 18045.5.) Nijjar and Miller’s argument is not persuasive.
By prohibiting a real estate broker from maintaining “any” place
of business where two or more mobilehomes are offered for sale,
the Legislature did not intend to prohibit a broker only from
selling mobilehomes at the place where the broker’s books and
records are kept. To accept Nijjar and Miller’s contention would
effectively allow a broker to operate a mobilehome dealership but
avoid the licensing requirements of the Manufactured Housing
Act simply by keeping its books and record offsite.8
Finally, even if Nijjar did not violate section 10131.6,
subdivision (b), reversal is not warranted because it is not
reasonably probable the Department would not have revoked
Nijjar’s and Miller’s licenses absent the administrative law
judge’s determination Nijjar violated that particular statute. The
administrative law judge (and the trial court) found Nijjar
violated both section 10131.6, subdivision (b), and section 10137
by employing Rodriguez to enter into the lease-to-own
agreements. Even if Nijjar’s conduct did not violate section
10131.6, subdivision (b) (because, under Nijjar and Miller’s
theory, Nijjar did not maintain a place of business where it
offered to sell multiple mobilehomes), Nijjar, as discussed, still
violated section 10137, the statute that prohibits a licensee from
retaining and compensating an unlicensed person to perform an
activity for which a license is required. (See Saad v. City of
Berkely (1994) 24 Cal.App.4th 1206, 1215 [where a city supported
its decision to deny a permit based on three findings, the permit
8 Moreover, by managing and operating the park through
Rodriguez, Nijjar “actually occupied” the park at regular periods.
27
applicant could not demonstrate a prejudicial abuse of discretion
by showing the city erred in one of the findings, “[u]nless the
findings [were] so intertwined that a failure of one could
reasonably lead the City to reconsider its denial”].)
3. Substantial Evidence Supported the Trial
Court’s Finding Nijjar Violated the Health and
Safety Code
Section 10176, subdivision (m), provides that the
commissioner may revoke a license if the licensee “[v]iolat[es] any
section, division, or article of law which provides that a violation
of that section, division, or article of law by a licensed person is a
violation of that person’s licensing law, if it occurs within the
scope of that person’s duties as a licensee . . . .” The trial court
found there was sufficient cause to revoke Nijjar’ and Miller’s
licenses under section 10176, subdivision (m), because Nijjar
violated Health and Safety Code, section 18550, subdivision (a),
as well as various HCD regulations, by allowing tenants to
occupy mobilehomes that were not permitted for human
occupancy. Substantial evidence supported the trial court’s
findings.
Health and Safety Code section 18550, subdivision (a),
provides: “It is unlawful for any person to . . . cause, or permit to
be used for occupancy” any mobilehome “supplied with fuel, gas,
water, electricity, or sewage connections, unless the connections
and installations conform to regulations” of the HCD. The HCD’s
regulations are in Title 25 of the California Code of Regulations
and, as relevant here, require the Department to inspect and
approve any such fuel, gas, water, electricity, or sewage
installations before a mobilehome may be used for occupancy.
28
Section 1324 of title 25 provides a “permit shall be obtained from
the enforcement agency each time a [mobilehome] unit is located
. . . on any site for the purpose of human habitation.” (Cal. Code
Regs., tit. 25, § 1324, subd. (a).) Section 1326 of the regulations
provides that, after issuing the permit, the Department must
inspect and approve the installation of the mobilehome, and the
mobilehome “shall not be occupied for human habitation prior to
inspection and approval of the installation.” (Id., tit. 25, § 1326,
subds. (a), (e)). To approve the installation and permit human
habitation, the Department must also approve the mobilehome’s
“utility facilities”; i.e., the fuel, gas, water, electricity, or sewage
connections. (Id., tit. 25, § 1328; see also id., §§ 1352-1358.)
There was substantial evidence Nijjar “cause[d], or
permit[ted] to be used for occupancy,” a mobilehome supplied
with utility facilities the Department had not approved.
Martinez testified he was “the inspector for the area that would
have inspected any homes installed” at the Four J’s Park. He
testified that the park obtained a permit to install electrical
infrastructure before any mobilehomes were installed, but that
no one had applied for human occupancy permits for any of the
mobilehomes. Martinez also testified there appeared to be
“somebody living” in each of the seven mobilehomes he observed.
Nijjar and Miller contend that only the owner of the park or
mobilehomes can be liable for allowing tenants to occupy the
homes without the required permits and approvals. The trial
court correctly ruled, however, Health and Safety Code section
18550 contains no such limitation. Health and Safety Code
section 18550 states it is unlawful for “any person,” not just a
park owner, to “cause, or permit to be used for occupancy,” a
mobilehome without the required approvals. Nijjar caused and
29
permitted the units to be used for occupancy because Rodriguez,
acting on behalf of Nijjar, provided the keys to the mobilehomes
to the tenants/buyers and entered into lease-to-own agreements
with them.
The legislative history confirms persons other than the
owner of the mobilehome or park may be liable for violating
Health and Safety Code section 18550. Health and Safety Code
section 18550 was previously codified at section 18250. (See
Health & Saf. Code, former § 18250, added by Stats. 1961,
ch. 2176, § 2, p. 4508, and reenacted and renumbered by Stats.
1973, ch. 1103, § 7, p. 2247.) Before the Legislature renumbered
the statute, Health and Safety Code section 18250 provided it
was unlawful “for any person in a mobilehome or mobilehome
park to use or cause, or permit to be used for occupancy” a
mobilehome that did not comply with various regulations. (See
Health & Saf. Code, former § 18250, subds. (b), (g), as amended
by Stats. 1963, ch. 2020, §1, p. 4142, italics added.) When in
1973 the Legislature renumbered section 18250 as section 18550,
it removed the words “in a mobilehome or mobilehome park” from
the statute, so that the statute simply provided (as it does now)
that it was unlawful for any person—not only a person in a
mobilehome or mobilehome park—to cause or permit to be used
for occupancy a mobilehome that did not comply with the
applicable regulations. (See Health & Saf. Code, § 18550, as
enacted by Stats. 1973, ch. 1103, § 7, p. 2247.) The Legislative
Counsel’s summary of section Senate Bill No. 262—the bill that
amended and renumbered former section 18250 as section
18550—confirmed that the intent of the amendment was to
expand the scope of persons liable for violating the statute
beyond only persons in the mobilehome park or mobilehome.
30
(See Legis. Counsel’s Dig., Sen Bill No. 262 (1973-74 Reg. Sess.)
Summary Dig., pp. 172-173 [the amendment “[m]akes it unlawful
for any person to use or cause, or permit to be used for occupancy,
certain prescribed mobilehomes wherever located, rather than for
any person in a mobillehome to use or cause, or permit to be used
for occupancy certain prescribed mobilehomes”].) By expanding
the scope of liability from only persons in the mobilehome or
mobilehome park to “any person,” the Legislature could not, as
Nijjar and Miller assert, have intended to restrict liability to only
mobilehome or mobilehome park owners.
Moreover, even if there were some limitation on who may
be liable under section Health and Safety Code 18550, such a
limitation would not apply to Nijjar. Health and Safety Code
section 18420 provides that, if the HCD determines “a
mobilehome park is in violation of any provision” of the Health
and Safety Code governing mobilehomes, the HCD shall issue a
notice to correct the violation “to the owner or operator of the
mobilehome park and to the responsible person, as defined
in [Health and Safety Code] Section 18603.” Health and Safety
Code section 18603, in turn, defines the responsible person as the
person available to respond to emergencies concerning “the
operation and maintenance of the park.”
The trial court found Nijjar was “operating” the park.
Substantial evidence supported that finding, or at least a finding
Nijjar was acting as a responsible person. Martinez testified that
Nijjar was the manager of the park when he inspected it in
January 2016 and that he communicated with Nijjar about the
permit violations. When Jediny inspected the park in February
2016, Rodriguez identified himself as the manager. Miller
admitted that one of Nijjar’s employees (though not Rodriguez)
31
was “in charge of the operations” of the park. And, although
Cobra 28 No. 7, not Nijjar, held the permit to operate the park,
Nijjar was leasing spaces in the park—one of the activities only
the licensed operator may perform. (See Health & Saf. Code,
§ 18500, subd. (c); Cal. Code Regs., tit. 25, § 1106.5.)
DISPOSITION
The judgment is affirmed. The Department is to recover its
costs on appeal.
SEGAL, J.
We concur:
PERLUSS, P. J.
FEUER, J.
32