Berg v. Davi: No Real Estate License for Disbarred Attorney

A California court has considered whether a court properly denied a real estate license to a disbarred attorney.

The California Department of Real Estate ("Department") denied Bernard James Berg ("Applicant") a real estate license. The Department based its denial on earlier proceedings conducted by the state bar which had resulted in the Applicant's disbarment as an attorney. The grounds for the Applicant's disbarment involved his overbilling of a client and withdrawing disputed funds from his trust account.

California law allows the Department to deny a license if the applicant has had a license revoked by another agency for acts which would have also constituted grounds for revoking a real estate license. When the Applicant applied for a real estate license, the Department set forth the reasons for its denial in a petition and a hearing was held before an administrative law judge ("ALJ") on the petition. The ALJ had found that the Applicant had been disbarred for acts involving fraud and dishonesty and these would be sufficient grounds for the revocation of a real estate license. The Department adopted the ALJ's opinion. The Applicant appealed his denial on a number of grounds to a trial court, but the trial court affirmed the Department's denial. The Applicant appealed.

The Court of Appeal of the State of California, Third Appellate District, affirmed the denial of a real estate license. On appeal, the Applicant raised numerous challenges to the denial of his real estate license application. One the arguments raised by the Applicant was that the factual evidence relied upon by the Department was contained in documents from earlier proceedings and these documents were hearsay. The Applicant argued that judicial notice could be taken of these proceedings, but the underlying facts should not be used as evidence. The court rejected this argument, as California law specifically allowed the Department to rely upon the actions taken by another state regulatory agency and the underlying facts related to the Applicant's disbarment were admitted to explain the basis of the disbarment proceedings.

Next, the Applicant argued that he was denied due process because disbarment proceedings are conducted in a different manner than the Department's proceedings. The court rejected this argument, finding that so long as the Applicant was afforded due process in both proceedings, the fact that the Department's hearings were conducted in a different manner was irrelevant.

Finally, the Applicant argued that California's highest court had not made an express finding that he had violated California law, as the court had simply affirmed the earlier proceedings by denying the Applicant' petition for review without issuing an opinion. The court also rejected this argument, as California law did not require such a determination. Instead, all that was required was the fact that another agency had revoked the individual's license, and that standard was met in this case. Thus, the court affirmed the Department's denial of a real estate license to the Applicant.

Berg v. Davi, No. C046809, 2005 WL 1394768 (Cal. Ct. App. June 14, 2005). [This is a citation to a Westlaw document. Westlaw is a subscription, online legal research service. If an official reporter citation should become available for this case, the citation will be updated to reflect this information].