Under California law (Business and Professions Code §10177) the Real Estate Commissioner may deny issuance of a license to an applicant who has been convicted of a felony or a crime substantially related to the qualifications, functions, or duties of a real estate licensee. There is, however, another section of that code (§480) that provides an exception to this principle. According to that section, no one shall be denied a license on the basis of a conviction if, according to specified criteria, that person has been rehabilitated. How this all plays out is seen in a recent appellate court decision (Singh v. Davi, as Real Estate Commissioner, Third District Court of Appeals, October 24, 2012).
Dave Singh, a native of India who became a naturalized citizen in 1986, served as a police officer from 1997 until 2004. During that time he received numerous commendations. In 2001, Singh lived with his extended family including his seventy year old father, Sarbjit, and his adult brother, Jasmer. Sarbjit was disabled. Jasmer is mentally handicapped.
Singh's wife had applied for and obtained benefits through In Home Supportive Services (IHSS). The program allowed disabled persons to remain in their home with family members providing assistance. IHSS made payments to Sarbjit, who, in turn, paid Jasmer to provide him assistance with bathing, dressing, and other needs.
In October of 2001, Sarbjit and his wife went to India and ended up staying there for three months after Sarbjit suffered a stroke. During this time the payments continued, even though Sarbjit was not at home receiving care from a family member. A fraud investigation resulted in Singh, the head of the household, being convicted of grand theft (by false pretenses). The trial court reduced the offense to a misdemeanor and granted Singh three years of probation. He lost his job as a police officer.
In 2006 Singh filed an application for a real estate broker license. It was denied on the basis of his conviction. He applied again in 2008. Again it was denied. A hearing was held before an administrative law judge (ALJ). Four witnesses, including three police officers, testified as character witness. Testimony and evidence was provided showing that he had exceeded his probationary community service requirement and that he was, in other respects, leading an exemplary life. Nonetheless, the ALJ ruled against him.
The ALJ said that it would not be in the public interest to issue Singh a broker's license "given the dishonest nature of his conviction." The Real Estate Commissioner adopted the ALJ's decision and denied the license. Singh then petitioned a Superior Court to set aside the Commissioner's decision.
The trial court agreed with Singh's contention that the Commissioner had abused his discretion "because the Commissioner could not legally deny Singh a real estate broker's license because of his conviction where Singh had complied with all applicable criteria of rehabilitation." The Commissioner then went to the Court of Appeal.
But the Appellate Court agreed with Singh. It upheld the trial court's ruling. The Appellate Court said that the "ALJ did not find Singh's rehabilitation inadequate because he failed to fully satisfy...any other criteria of rehabilitation. Instead, the ALJ expressly found Singh's rehabilitation was inadequate 'given the dishonest nature' of his crime and his status as a police officer at the time..." The ALJ and the Commissioner had focused on the nature of the crime, rather than on the conditions of rehabilitation. These were improper grounds for denying the license.
We wish Mr. Singh the very best in his real estate career.