Bohn v. Watson

• Decision Date: 30 December 1954
• Citation: 130 Cal.App.2d 24,278 P.2d 454
• Court: California Court of Appeals Court of Appeals
• Parties: Claire F. BOHN, Petitioner and Appellant, v. D. D. WATSON, Real Estate Commissioner, Defendant and Respondent. Civ. 20257.

Page 454

278 P.2d 454

130 Cal.App.2d 24

Claire F. BOHN, Petitioner and Appellant, v. D. D. WATSON, Real Estate Commissioner, Defendant and Respondent.

Civ. 20257.

District Court of Appeal, Second District,Division 2, California.

Dec. 30, 1954.

Hearing Denied Feb. 24, 1955.

S. V. O. Prichard, Beverly Hills, Oliver O. Clark, for appellant.

Edmund G. Brown, Atty. Gen., Lee B. Stanton, Deputy Atty Gen., for respondent.

FOX, Justice.

This is an appeal from a judgment denying an application for a writ of mandate.

The petitioner (hereinafter designated Bohn) was a licensed real estate broker for more that 20 years. On December 18, 1951, an accusation was filed with the Real Estate Commissioner charging her with a violation of the provisions of sections 10177.5 and 10177(f) of the Business and Professions Code. Two specific charges are set out in the accusation.

One charge alleges that on July 15, 1951, a final judgment by default was entered against Bohn and others by the Superior Court of Los Angeles County in a matter numbered Pasadena C-3615 and entitled 'William E. Elliott (an incompetent person) by Edith Lamm (Guardian of his Person and Estate) vs. Claire F. Bohn, et al.,' and that this judgment was based upon the grounds of fraud, misrepresentation and deceit with reference to a transaction for which a real estate license was required. The other charge relates to a matter similarly entitled, bearing the number Pasadena C-3352, and alleges that after the filing of said suit, a stipulation permitting plaintiff to take judgment was signed and filed on August 10, 1951; that pursuant to said stipulation, a final judgment was entered therein against Bohn on August 15, 1951; that said judgment is based upon a complaint alleging Bohn's fraud, misrepresentation and deceit in a transaction for which a real estate license was required.

Bohn filed an answer to the accusation admitting that the two judgments referred to therein had been entered against her and that she had signed a stipulation that she had committed fraud in connection with case C-3352 but denying that she was in fact guilty of fraud, misrepresentation or deceit with respect to either transaction. By way of affirmative defense, she alleged that she did not file any answer in case No. C-3615 because of her intent to pay the monies claimed and to spare the expense of litigation to plaintiff therein; and that her consent to the stipulated judgment in case No. C-3352 was motivated by her desire to assure plaintiff that his collection of the monies sued for would not be barred by any proceeding in bankruptcy. The statute of limitations was not raised by the said answer. No objection was made at any time to the form of the accusation and was thereby waived, Government Code, § 11506(b).

The matter was heard before a hearing officer in two sessions. Testimony was taken from Bohn and from 12 witnesses called in her behalf. The complaint and default judgment in civil case, No. 3615 (hereafter sometimes denominated the Albert Motel transaction) was introduced in evidence, together with a 68 page deposition of Bohn taken in connection therewith. There was also received in evidence the complaint, stipulation and judgment in civil action No. 3352 (hereafter sometimes designated as the St. Andrews transaction). After the termination of the hearing, the Real Estate Commissioner found, with respect to the Albert Motel transaction, that a default judgment was entered against Bohn which provided that plaintiff therein recover $42,974.09 on the first cause of action, which was based on fraud, misrepresentation and deceit, and a concurrent judgment of similar amount, together with interest, costs and attorney's fees on the second cause of action. With respect to the St. Andrews transaction, it was found, in brief, that pursuant to a written stipulation signed by Bohn and her counsel (more fully adverted to in a subsequent division of this opinion) judgment was entered in favor of plaintiff for $12,418.27 on his fourth cause of action, which was based on Bohn's fraud, deceit and false representations in securing the assignment to her of a note and deed of trust. The commissioner also found that the above judgments were unpaid; that the transactions upon which the above judgments were based were not transactions for which a real estate license was required; and that Bohn acted and conducted herself in a manner which would have warranted the denial of her application for a real estate license. Bohn's license was thereupon ordered revoked for violation of section 10177(f) of the Business and Professions Code. ^*

Bohn petitioned the superior court for a writ of mandate to compel the commissioner to cancel his order revoking her license and to reinstate her as a real estate broker. No reference is made in the petition to any statute of limitations. The cause was submitted upon the record of the proceedings before the commissioner, together with the pleadings and briefs. In her opening brief, Bohn raised for the first time the issue of the three year statute of limitations contained in Business ond Professions Code, section 10177 with respect to the Albert Motel transaction. After a review of the administrative record, the trial court sustained the action of the commissioner, upon findings which will hereafter be more particularly discussed.

Since one of Bohn's principal contentions is that there was no substantive evidence to support certain of the material findings and the judgment of the trial court, it will be sufficient to state the evidence which supports the findings and judgment, in accordance with the settled rule that an appellate court will not resolve significant conflicts in the evidence or draw inferences contrary to those reasonably drawn by the trial court. The record shows that in 1946 Bohn became acquainted with William E. Elliott, who was then about 80 years old. Mr. Elliott was introduced to Bohn through a member of the Christian Science Church to which Bohn also belonged and in which Elliott worshiped. Shortly thereafter Bohn acted as Elliott's agent in the purchase of a residence on St. Andrews Place, in Los Angeles, for which Elliott paid $19,000 in cash. Elliott lived there for about a year and then sold this property, Bohn once again acting as Elliott's broker. The sale was made to a Mrs. Pearl Bernsen (sometimes referred to as Bernstein) also a member of the same Christian Science Church to which Bohn belonged and Elliott attended. The price was $18,000, with $4,000 paid in cash, the balance covered by a note secured by a four percent deed of trust payable at $75 per month. Elliott continued to reside in the St. Andrews home as a roomer for several months, until he found new quarters in the same neighborhood.

The friendship between Bohn and Elliott ripened in the succeeding months. In her deposition, Both stated she occasionally called at Elliott's home 'to take him to church or a lecture or something.' She testified she accompanied him on two occasions to his safe deposit box. The first visit was to deposite therein the trust deed received on the sale of the St. Andrews property; the second so that Bohn might examine some insurance which Elliott feared might have been cancelled. Bohn also stated in her deposition that Elliott repeatedly told her he had made some provision for her in his will without disclosing the extent thereof.

The Albert's Motel Transaction

In about September, 1947, Natalie Chamberlain and her husband, friends of Bohn, were owners of Albert's Motel, a 22 unit property with living quarters for the owner. The Chamberlains were seeking a loan in order to facilitate the consummation of a trade of Albert's Motel for a motel in Monrovia, California, known as Motel 66, owned by Frank Collins and Amy Smee, who afterwards married. Acting as agent for the Chamberlains, Bohn procured a loan of $40,000 from Elliott, secured by a first deed of trust on Albert's Motel. Bohn received a substantial commission for her services. She testified Elliott had previously told her he had about $40,000 in liquid assets which he wished to invest and asked her to find a suitable investment. She stated Elliott visited Albert's Motel twice, and looked about for three hours, before making the loan. Thereafter, the Chamberlains conveyed Albert's Motel and some cash to the Calkinses in exchange for Motel 66.

Bohn testified that in July, 1948, the Calkinses informed her they desired to sell Albert's Motel. She stated that while she was visiting at the motel with Elliott Mrs. Calkins chanced to remark that Bohn ought to buy the motel herself, but Bohn protested she had no money. Thereupon, Mr. Elliott also urged that she buy the motel and met her objection that she lacked funds with the proposal 'Why don't you use my money?' Bohn stated that for several weeks thereafter she resisted Elliott's oftrepeated suggestion that she buy the motel. At last she yielded. Since Elliott himself had no ready cash, Bohn suggested that Elliott subordinate his first deed of trust, on which a balance of about $37,500 was then due, to a third deed of trust, which would enable her to arrange the financing necessary to make the purchase. She stated Elliott agreed to this plan.

About August, 1948, the sale of the motel from Calkins to Bohn was completed through escrow for $142,500. Bohn paid the Calkinses about $40,000 in cash, from money which she derived by a loan. The lender was given a first deed of trust for $40,000, while the Calkinses took back a second deed of trust for $65,000 for the balance of their equity. Elliott thereby became the junior encumbrancer, his interest now evidence by Bohn's promissory note for $41,059.00, secured by a third deed of trust. This increase of approximately $3,500 in the amount formerly secured by the first deed of trust represented funds advanced by Elliott to Bohn to enable her to close the escrow. Bohn asserted that when...