You can
search the entire site.
or go to the recent opinions, or the chronological or subject indices.
Wendte v. State, Board of Real Estate Appraisers (5/23/2003) sp-5694
Wendte v. State, Board of Real Estate Appraisers (5/23/2003) sp-5694
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
requested to bring errors to the attention of the Clerk
of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
RONALD W. WENDTE, )
) Supreme Court No. S-10558
Appellant, )
) Superior Court No. 1JU-01-1359
CI
v. )
) O P I N I O N
STATE OF ALASKA, BOARD OF )
REAL ESTATE APPRAISERS, ) [No. 5694 - May 23, 2003]
)
Appellee. )
________________________________)
Appeal from the Superior Court of the State
of Alaska, First Judicial District, Juneau,
Patricia A. Collins, Judge.
Appearances: Robert S. Spitzfaden, Gruening
& Spitzfaden, APC, Juneau, for Appellant.
Gayle A. Horetski, Assistant Attorney
General, and Bruce M. Botelho, Attorney
General, Juneau, for Appellee.
Before: Fabe, Chief Justice, Matthews,
Eastaugh, Bryner, and Carpeneti, Justices.
EASTAUGH, Justice.
I. INTRODUCTION
After Ronald Wendte was convicted of first degree theft
for stealing about $250,000 from three children's sports
programs, the Alaska Board of Certified Real Estate Appraisers
suspended his real estate appraiser's license for two years. It
did so under authority of AS 08.87.210(2). The superior court
affirmed the suspension. We also affirm, because there is no
merit to Wendte's appellate arguments that there was no nexus
between his criminal conduct and his professional licensure, and
that the board failed to consider relevant or current
information. We conclude that substantial evidence supports the
decision the board adopted, that there was a reasonable basis for
the board's licensure action, and that the superior court
correctly analyzed and rejected Wendte's administrative appeal.
II. FACTS AND PROCEEDINGS
Ronald Wendte has been a residential real estate
appraiser in Ketchikan since he opened his own appraisal
business, Wendte Services, in 1978. Wendte volunteered his time
to handle the finances for several nonprofit children's sports
organizations in Ketchikan. His volunteer responsibilities
included preparing gaming permit applications, collecting and
depositing revenues, issuing checks, and planning raffles.
Between October 1993 and January 1997 Wendte stole over
$250,000 from the Ketchikan Little League, Little League District
2, and the Kayhi Girls Basketball Club. In August 1998 Wendte
pled no contest to one count of first degree theft, a Class B
felony offense. Superior Court Judge Michael A. Thompson
sentenced Wendte to five years in prison, with four suspended,
and to ten years probation. He also ordered Wendte to complete
1,000 hours of community service and pay restitution of
$257,594.80.
While Wendte was imprisoned, the Department of Commerce
and Economic Development, Alaska Division of Occupational
Licensing, notified him of its intention to seek disciplinary
sanctions under AS 08.87.210(2) because of his theft conviction.
Through his attorney, Wendte negotiated an agreement with the
Division of Occupational Licensing to settle the disciplinary
matter. The agreement recommended five years of professional
probation and a $5,000 fine, payment of which would be stayed so
long as he complied with the terms of his criminal probation and
parole. By its own terms, the agreement was subject to approval
by the Board of Certified Real Estate Appraisers. In March 2000
the board unanimously rejected the agreement and issued an
accusation seeking either revocation or suspension of Wendte's
license.
At Wendte's request, an administrative hearing was held
in Juneau in January 2001. Wendte was represented by counsel,
presented witnesses, and testified on his own behalf. The record
also included letters written by members of the Ketchikan
community to support his retention of his license. At the time
of the hearing, Wendte had repaid $2,602.12 of the $257,594.80 he
owed in restitution.
Administrative Hearing Officer David G. Stebing issued
findings of fact, conclusions of law, and a proposed decision in
July 2001; he concluded that Wendte's theft conviction qualified
as a crime of moral turpitude under AS 08.87.210(2) and that the
board had discretion to reject Wendte's agreement with the
division. The hearing officer concluded that revocation of
Wendte's license was too harsh because Wendte's crime was "not
directly related to his appraisal activities." He recommended
that the board suspend Wendte's license for two years and place
him on professional probation for five years after he returned to
active status.
In September 2001 the board met to consider whether to
adopt the hearing officer's proposed decision. After conferring
in executive session, the board declined to permit counsel to
argue, but gave Wendte three minutes to address the board
members. Immediately after Wendte completed his comments, the
board unanimously voted to adopt the hearing officer's sanctions
recommendation. Wendte's license was consequently suspended for
two years, effective December 2001, to be followed by five years
of probation.
Wendte appealed the board's decision to the superior
court. He also petitioned the board to reconsider its decision.
He also asked the board and the superior court to stay suspension
of his license pending the resolution of his superior court
appeal. The superior court ultimately denied Wendte's request to
stay his suspension.1
In February 2002 Superior Court Judge Patricia A.
Collins affirmed the board's decision. The court held that there
was substantial evidence to support disciplining Wendte for a
crime involving moral turpitude under AS 08.87.210(2) and that
the board properly acted within its discretion in sanctioning
Wendte. The court held that "there is a direct relationship
between a conviction for theft and a professional's ability to
reflect high ethical standards for the profession."
Wendte appeals this order.
III. DISCUSSION
A. Standard of Review
Because the superior court sat as an intermediate court
of appeal, we will independently review the merits of the board's
administrative determination.2
We review findings of fact in appeals of administrative
decisions under the "substantial evidence" test.3 Substantial
evidence is "such relevant evidence as a reasonable mind might
accept as adequate to support a conclusion."4 In this case, we
will review the administrative hearing officer's findings of fact
which were later adopted by the board and served as the basis for
suspension of Wendte's license. The superior court did not
conduct a de novo review of the board's decision.
When an appeal of an agency decision involves a
question of statutory interpretation, we apply one of two
standards.5 The "reasonable basis" test applies when an issue of
law requires agency expertise.6 When an issue of law does not
involve agency expertise, the "substitution of judgment" test
applies.7 Because this appeal concerns a disciplinary statute
authorizing the Board of Certified Real Estate Appraisers to
exercise its own discretion in sanctioning license holders, we
will apply the "reasonable basis" test.
B. The Board Had Authority To Sanction Wendte Under AS
08.87.210(2).
Under AS 08.87.210(2), the Board of Certified Real
Estate Appraisers may exercise its disciplinary powers under AS
08.01.0758 if the board finds that an appraiser has "been
convicted of a crime that involves moral turpitude."9 On its
face, AS 08.87.210(2) only requires the board to find that a real
estate appraiser has been convicted of a crime of moral turpitude
in order to exercise its disciplinary powers.
The parties do not dispute that Wendte's felony theft
conviction is a crime of moral turpitude.10 Instead, Wendte
argues that AS 08.87.210(2) requires the board to find a nexus
between a crime of moral turpitude and his ability to carry out
his professional duties before issuing sanctions. He claims that
because the board found both that his theft was "not directly
related to his appraisal activities" and that his "crime [had] no
direct nexus to his professional activity," he should not be
sanctioned.
Wendte's argument is unconvincing. Nothing in the
language of AS 08.87.210(2) suggests that the board may only
sanction licensees who commit crimes of moral turpitude while
they are performing their professional duties. Wendte's argument
fails to recognize that criminal violations may bear on one's
fitness to practice a particular profession, regardless of
whether the violations are committed while the licensee performs
professional duties.
In Alaska, it is common for professional licensing
statutes to permit a board to impose sanctions for criminal
misconduct occurring outside the scope of required professional
duties.11 We have upheld sanctions imposed against professionals
who committed crimes of moral turpitude when they were not
carrying out professional responsibilities.12 Other courts have
similarly interpreted professional disciplinary statutes
authorizing sanctions against licensees who have committed crimes
involving moral turpitude to cover crimes not committed while
they performed professional activities.13
Although there are no reported Alaska cases applying AS
08.87.210(2), we have held in two comparable professional
licensing cases that a licensing board need not establish that
there is a nexus between a crime involving moral turpitude and
one's ability to carry out the professional duties to issue
sanctions. In Kenai Peninsula Borough Board of Education v.
Brown, we upheld a school board's decision to dismiss a tenured
teacher convicted of the crime of willfully diverting
electricity, which the board held was a theft, and therefore a
crime of moral turpitude.14 We did not require a showing of a
nexus between the teacher's criminal conduct and his capacity to
perform his job.15 Instead, we held that a "finding that a crime
involving moral turpitude has been committed raises at least a
presumption that there is a nexus between the teacher's act and
the teacher's fitness to teach."16 We observed that, "[t]he
legislature, in enacting certain criminal statutes, has
established minimum acceptable moral standards for the state as a
whole. If a teacher cannot abide by these standards his or her
fitness as a teacher is necessarily called into question."17
In a later case involving the same teacher disciplinary
statute, we upheld the dismissal of a teacher who years earlier
had engaged in sexual misconduct with a minor.18 Relying on
Brown, we said, "it is well established that there need not be a
separate showing of a nexus between the act or acts of moral
turpitude and the teacher's fitness or capacity to perform his
duties."19 We observed that if the school district had sufficient
evidence that Toney had committed an act of moral turpitude, the
dismissal was valid.20
The reasoning of Brown and Toney is persuasive. Alaska
Statute 08.87.210(2) contemplates a nexus between a crime
involving moral turpitude and the ability to satisfy the
requirements of the profession. We hold here that there is a
presumed logical nexus between any crime of moral turpitude and
the ability to satisfy the ethical standards of the real estate
appraisal profession. The superior court correctly noted that
when professionals commit crimes involving moral turpitude "their
fitness to hold a position of trust is necessarily called into
question."
Alaska Statute 08.87.210(2) contemplates that a crime
involving moral turpitude necessarily bears on a real estate
appraiser's trustworthiness, regardless of whether a licensee
commits such a crime while acting as a real estate appraiser.
The real estate appraisal profession requires reliability and
honesty of its members. An appraiser who had been the first
chairman of the Alaska Board of Certified Real Estate Appraisers,
Alfred Ferrara, testified at Wendte's January 2001 hearing. He
testified that the purchase of a house is "often the largest
financial transaction many individuals ever get involved in." He
explained that the appraiser is "the only objective party, quite
often, in that transaction."21
Wendte argues that he has rebutted any presumption of a
nexus between a crime of moral turpitude and fitness to perform
duties. He cites the Brown court's observation that during the
disciplinary hearing provided under the statute, "[o]f course .
. . the teacher may attempt to demonstrate that the board should
retain the teacher despite the finding of a crime involving moral
turpitude."22 Wendte claims that he has overcome the Brown
presumption because the board found that his crime did not have a
direct connection with his real estate activities. He therefore
claims he should not be sanctioned at all.
Wendte's argument is without merit. The board found
that "Wendte's theft conviction is not directly related to his
appraisal activities." But that is not evidence that he
sufficiently rebutted the presumption that he was unfit to be a
real estate appraiser. As discussed above, Brown held that a
finding that a crime of moral turpitude has been committed raises
at least a presumption that there is a nexus between a
professional's act and his fitness to practice his profession.
Fitness to practice a regulated profession demands more than the
professional's capacity to perfunctorily complete required
activities. The board's finding that Wendte's crime was not
directly related to his professional activities does not rebut
Brown's presumption that there is a nexus between a crime of
moral turpitude and one's fitness to hold a professional license.23
The plain language of AS 08.87.210(2) suggests that
there is a connection between a crime of moral turpitude and
general fitness to be a real estate appraiser regardless of
whether the crime was committed in the course of carrying out
real estate appraising activities. Because the board properly
found that Wendte's theft was a crime of moral turpitude, the
board had discretion to impose sanctions.24 We therefore affirm
the superior court's decision affirming the board's sanctions.
C. Double Jeopardy
Wendte also argues that he cannot be sanctioned because
the suspension of his professional license is a punishment that
violates the prohibition on double jeopardy.
In Alaska, revoking or suspending a professional
license is not "punishment" for double jeopardy purposes when it
furthers a regulatory goal. In State v. Zerkel, the Alaska Court
of Appeals held that administratively revoking a driver's license
for refusing to submit to a blood alcohol test did not constitute
punishment for double jeopardy purposes.25 The court there
observed that "[a] person who loses a professional license in an
administrative proceeding is not subjected to `punishment' for
double jeopardy purposes, even though the revocation or
suspension is based on misconduct that could be or has been
prosecuted as a criminal offense."26 The court recognized that
professional license revocation does not punish the licensee, but
rather serves the regulatory goal of protecting the public from
unfit practitioners.27
We later observed in State v. Niedermeyer that
administrative revocation or suspension of a professional license
"can legitimately serve to deter conduct and still remain
`remedial' for double jeopardy purposes so long as the revocation
or suspension is based on conduct that bears a direct relation to
the government's regulatory goals or to the proper administration
and enforcement of the regulatory scheme."28
Wendte argues that "the prohibition against double
jeopardy prevents sanctioning a licensee, unless there is a
direct nexus between the criminal conviction for a crime of moral
turpitude and the professional activity of the licensee." Thus,
he argues that because the board found that his theft was not
connected to his appraisal activities, the suspension of his
license does not bear a direct relation to the state's regulatory
goals. Here again, Wendte asserts that only professional
activities should bear on his fitness as a real estate appraiser.
But as discussed above, there is a nexus between committing a
crime of moral turpitude and one's fitness to be a real estate
appraiser. Alaska Statute 08.87.210(2) reflects the board's
regulatory goal of maintaining high ethical standards for the
profession.
D. The Board's Decision Was Reasonably Based on Relevant and
Current Information.
Wendte argues that the board did not base its decision
on relevant or current information. He first contends that the
board did not consider his post-conviction conduct, the effect of
the hearing officer's proposed sanctions on his ability to make
restitution payments, and alternative lesser sanctions. In
support, he cites only State, Division of Insurance v. Schnell,
in which we held that an insurance agent whose license was
suspended was entitled to present updated evidence regarding his
professional conduct during the period of time after disciplinary
proceedings had been instituted.29 Without conducting a new
hearing, the Alaska Division of Insurance took almost three
years, l992-95, to issue a decision disciplining Schnell, due in
part to personnel changes at the division.30 We held that Schnell
was entitled to present updated evidence describing (1) his post-
1992 conduct, (2) the current effect that the hearing officer's
proposed sanctions would have, and (3) alternative supervisory
controls available through his employer.31 We concluded that this
evidence was highly relevant to the issue of sanctions.32
Schnell is inapposite. We directed the division on
remand to consider updated evidence because there was a three-
year delay between the hearing and the issuance of a decision
disciplining Schnell. Schnell does not require licensing boards
to apply particular criteria when imposing sanctions. Nor does
Schnell require boards to give any particular factors a certain
weight. Likewise, AS 08.87.210(2) here grants the board
discretion to impose sanctions on real estate appraisers.
Although the board must exercise its discretion reasonably, the
statute does not require the board to consider any particular
criteria when imposing sanctions.
Nonetheless, the record establishes that the hearing
officer did consider Wendte's post-conviction conduct and the
effect of proposed sanctions on Wendte's life. The hearing
officer acknowledged that Wendte's real estate appraisal business
"was rebounding after his incarceration." The hearing officer
acknowledged that Wendte was not able to work during his
incarceration, but found it significant that he had paid only
$2,602.12 of the $257,594.80 in restitution he owed at the time
of the January 2001 hearing. The hearing officer also considered
alternative sanctions for Wendte. Taking into account that
Wendte's crime was not perpetrated while conducting professional
activity, the hearing officer recommended that the board suspend
rather than completely revoke Wendte's license, even though the
division had requested revocation.
The board therefore considered the "criteria" that
Wendte requested, but drew a different conclusion than Wendte
would have liked. As Judge Collins concluded, "[i]t is fairly
clear that the [b]oard simply assigned different weight to the
evidence than that suggested by Mr. Wendte."
Wendte next argues that the board's September 2001
decision to suspend his license did not reflect any new
information about his conduct since the last hearing in January
2001. He contends that because the board voted immediately after
Wendte finished speaking, it did not consider the updated
evidence he offered. Wendte argues that Schnell "mandates that
the [b]oard hear updated information relevant to the issue of
sanctions before imposing sanctions."
Wendte's reliance on Schnell is again misplaced.
Wendte did not experience a three-year delay between his last
opportunity to offer evidence and the issuance of a decision.
Wendte's administrative hearing took place in January 2001. The
board issued its final decision in September 2001. Less than
eight months elapsed before the board imposed sanctions. This
period was too short to imply the likelihood of material changes
in Wendte's conduct.
Although Wendte had only three minutes to address the
board at the September 2001 hearing, the board was under no
obligation to allow either side to make any presentation. As the
superior court noted, the only updated evidence Wendte presented
at the September 2001 hearing concerned his most recent
restitution payment of $4,450, bringing his total payment to
$7,000. At the January hearing, Wendte had already presented
evidence that his business rebounded after he was released from
prison, submitted letters supporting him, and offered testimony
of witnesses recommending him as an honest appraiser. The
additional restitution is not legally significant, given both
that a large amount remained unpaid, and that restitution
payments were not the only factor the board considered in
sanctioning Wendte.33
Wendte also argues that the district attorney's
sentencing memorandum in the criminal case was insufficient "to
set forth the factual basis for Wendte's conviction." He argues
that he is not attacking the validity of his no-contest plea.
Instead, he argues that the board should not have used the
district attorney's sentencing memorandum as a factual basis on
which to sanction him administratively because "[w]hether Wendte
did what the district attorney's sentencing memorandum alleges
was never resolved in the criminal proceedings. . . . "
The hearing officer's proposed decision relied on more
than the district attorney's sentencing memorandum for its
account of the details of Wendte's theft. To substantiate his
findings of fact regarding the circumstances of Wendte's crime,
the hearing officer cited Wendte's licensing file, the judgment
and order of commitment and probation in State v. Wendte,34 the
state's sentencing memorandum and exhibits in State v. Wendte,
the Division of Occupational Licensing's investigative file on
Wendte, sentencing letters, and the transcript of Judge
Thompson's remarks at sentencing.
Moreover, Wendte did not ask the hearing officer not to
consider the district attorney's sentencing memorandum. He only
objected to the hearing officer using the sentencing memorandum
to establish any instances of theft other than those the state
advanced at Wendte's no contest hearing. Wendte did not,
however, identify any particular passages in the sentencing
memorandum which were unsubstantiated, nor does he do so now. He
also has not demonstrated how the hearing officer's consideration
of the sentencing memorandum harmed him. Wendte has therefore
waived his argument that the hearing officer should not have
considered the sentencing memorandum.35
IV. CONCLUSION
We AFFIRM the superior court decision affirming the
sanctions imposed by the board.
_______________________________
1 It is not clear from the record whether the board formally
denied Wendte's request for a stay of his suspension. In its
brief, the state asserts that the board took no action on his
motion and that it was therefore deemed denied under AS
44.62.540, which provides in part that "[i]f no action is taken
on a petition within the time allowed for ordering
reconsideration, the petition is considered denied."
2 Handley v. State, Dep't of Revenue, 838 P.2d 1231, 1233
(Alaska 1992).
3 Id.
4 Id.
5 Newmont Alaska Ltd. v. McDowell, 22 P.3d 881, 883 (Alaska
2001).
6 Id.
7 Id.
8 AS 08.01.075 provides in part:
(a) A board may take the following
disciplinary actions,
singly or in combination:
(1) permanently revoke a license;
(2) suspend a license for a specified period
. . . .
9 AS 08.87.210 provides:
The board may exercise its disciplinary
powers under AS 08.01.075 if, after hearing,
the board finds a certified real estate
appraiser has
(1) violated a provision of this chapter or
a regulation adopted by the board under this
chapter;
(2) been convicted of a crime that involves
moral turpitude; or
(3) committed, while acting as a real estate
appraiser, an act or omission involving
dishonesty, fraud, or misrepresentation with
the intent to benefit the appraiser or
another person or to injure another person.
10 Under Alaska law, an act of theft is commonly held to be an
act involving moral turpitude. See Disciplinary Matter Involving
Schuler, 818 P.2d 138, 140 & n.1 (Alaska 1991) (holding that
attorney's concealment of merchandise was crime of moral
turpitude); Kenai Peninsula Borough Bd. of Educ. v. Brown, 691
P.2d 1034, 1039 (Alaska 1984) (holding that teacher convicted of
willfully diverting electricity had committed crime of moral
turpitude); see also 52A C.J.S., Larceny 60(1)(b) (1968).
11 See, e.g., AS 08.88.071(a)(10) (authorizing board to revoke
or suspend license if real estate broker is "convicted of
forgery, theft, extortion, conspiracy to defraud creditors, or a
felony involving moral turpitude committed while licensed under
this chapter"); AS 08.04.450 (providing that board may revoke
license of accountant for "conviction of any crime, an essential
element of which is dishonesty or fraud, under the laws of any
state or the United States").
12 See, e.g., Disciplinary Matter Involving Schuler, 818 P.2d
138 (Alaska 1991) (upholding two-year suspension from practice of
law for district attorney convicted of concealment of
merchandise); Kenai Peninsula Borough Bd. of Educ. v. Brown, 691
P.2d 1034 (Alaska 1984) (upholding dismissal of tenured teacher
convicted of diverting electricity, a theft crime involving moral
turpitude).
13 See, e.g., Jennings v. Karpe, 111 Cal. Rptr. 776, 777-78
(Cal. App. 1974) (holding that licensed real estate broker's
conviction for engaging in oral sex with minor was crime of moral
turpitude and grounds for revocation of license even though not
connected with licensee's activities as real estate broker); Carp
v. Florida Real Estate Comm'n, 211 So. 2d 240, 241 (Fla. Dist.
App. 1968) (holding that registered real estate broker's
bookmaking conviction was crime of moral turpitude and grounds
for suspension or revocation of registration); Missouri Real
Estate Comm'n v. McCormick, 778 S.W.2d 303, 308 (Mo. App. 1989)
(upholding suspension of real estate broker's license where
broker plead guilty to theft related to insurance business).
14 691 P.2d 1034 (Alaska 1984).
15 The statute at issue in Brown, AS 14.20.170, provided in
part that "[a] teacher . . . may be dismissed at any time for . .
. immorality, which is defined as the commission of an act which,
under the laws of the state, constitutes a crime involving moral
turpitude . . . ." See Brown, 691 P.2d at 1036 n.1.
16 Brown, 691 P.2d at 1041.
17 Id.
18 Toney v. Fairbanks North Star Borough Sch. Dist., Bd. of
Educ., 881 P.2d 1112 (Alaska 1994).
19 Id. at 1114.
20 Id.
21 Ferrara initially testified at the January 2001 hearing that
he "usually [ ] would not refer someone . . . who has had a
criminal conviction of that type . . . ." He later testified
that he would look at the appraiser's post-conviction conduct to
see if he was doing good work.
22 Brown, 691 P.2d at 1041.
23 Cf. Alaska R. Evid. 609 (allowing impeachment of witness
based on conviction of crime involving dishonesty or false
statement).
24 See Toney, 881 P.2d at 1114 (holding that dismissal of
teacher was valid as long as school district had sufficient
evidence that Toney had committed act of moral turpitude); Brown,
691 P.2d at 1041 (holding that school board had met its burden of
going forward by finding that Brown had committed theft).
25 900 P.2d 744 (Alaska App. 1995).
26 Id. at 753.
27 Id. at 754.
28 14 P.3d 264, 269 (Alaska 2000) (quoting Zerkel, 900 P.2d at
757).
29 8 P.3d 351, 360-61 (Alaska 2000).
30 Id. at 354-55.
31 Id. at 360.
32 Id.
33 The board adopted the hearing officer's decision and did not
consider evidence beyond the record created at the January
hearing. In addition to payment of restitution, the hearing
officer considered Wendte's post-incarceration conduct, community
reaction to the crime, and the nature of Wendte's crime.
34 State v. Wendte, No. 1KE-97-99 Cr. (Alaska Super., March 22,
1999).
35 Walden v. Dep't of Transp., 27 P.3d 297, 304 (Alaska 2001)
("It is well-settled that a party must object to evidence at the
time it is offered in order to preserve the issue on appeal.").
