Brown v. Tennessee Real Estate Commission

• Citation: 494 S.W.2d 506
• Parties: Scott N. BROWN, Appellee, v. TENNESSEE REAL ESTATE COMMISSION, Appellant.
• Decision Date: 28 July 1972
• Court: Tennessee Court of Appeals

Page 506

494 S.W.2d 506

Scott N. BROWN, Appellee, v. TENNESSEE REAL ESTATE COMMISSION, Appellant.

Court of Appeals of Tennessee, Middle Section.

July 28, 1972.

Certiorari Denied by Supreme Court April 2, 1973.

David M. Pack, Atty. Gen., State of Tennessee, Everett H. Falk, Asst. Atty. Gen., State of Tennessee, Nashville, for appellant.

Paul W. Sorrick, Jr., Sorrick & Guthrie, Chattanooga, for appellee.

OPINION

SHRIVER, Presiding Judge.

This is an appeal by the Tennessee Real Estate Commission from a decree of the Chancery Court of Davidson County wherein it was held that the Commission acted arbitrarily and illegally in denying the appellee, Scott N. Brown, reinstatement of his real estate broker's license and which decree ordered the Commission to reinstate appellee's license. The parties will be referred to hereinafter as 'Petitioner' and 'Respondent', as they appeared in the Court below wherein Scott N. Brown was petitioner and Tennessee Real Estate Commission, respondent.

The petition for certiorari filed in the Chancery Court sought a review of the orders of the Tennessee Real Estatre Commission of the Tennessee Real Estate Commission broker's license to the petitioner. The writ of certiorari was issued October 20, 1970 and in response thereto the Commission filed the record of the proceedings before it.

The matter came on to be heard on October 6, 1971 before the Honorable Frank F. Drowota, III, Chancellor, who after a review of the record of the proceedings before the Commission and evidence adduced at the hearing before him, entered a decree to the effect that the Commission acted arbitrarily and illegally in denying the petitioner a real estate broker's license and ordered the Commission to reinstate said license. However, the Chancellor did not make a finding of fact and reduce same to writing along with this conclusions of law, as directed by the statute, 27--911, T.C.A.

From the foregoing decree, the respondent appealed and has assigned errors.

ASSIGNMENTS OF ERROR

There are two a assignments of error, as follows:

'1. The Chancellor erred in finding that the Commission acted arbitrarily and illegally in denying the petitioner a real estate broker's license when there was material evidence in the record and in the additional testimony at the trial to support the action of the Commission.

2. The Chancellor erred in weighing evidence under the common law writ of certiorari to determine whether the Commission acted arbitrarily, illegally or in excess of its jurisdiction when there was material evidence in the record to support the action of the Commission.'

The record reveals that petitioners, Scott N. Brown, was a licensed real estate broker and a former member of the Tennessee Real Estate Commission. He was an experienced real estate broker, having pursued that vocation beginning in the year 1933.

Petitioner was active in the organization of several companies, including Real Estate Management, Inc., serving as its President, Treasurer and Board Chairman until 1962 when said corporation became insolvent and went into bankruptcy. It appears that several other companies in which petitioner was either the sole or the majority stockholder were involved in this bankruptcy proceeding.

In addition to the bankruptcy of the companies in which petitioner was involved, he encountered other serious legal difficulties which resulted in three separate criminal prosecutions.

These matters which are in the record as part of the proceedings before the Tennessee Real Estate Commission concerning the application for the reinstatement of petitioner's license show that petitioner, Scott N. Brown, was indicted by the Grand Jury of Hamilton County, Tennessee on a charge of fraudulent breach of trust and violation of the Trust Receipts Law in November, 1962.

It is shown that petitioner was also indicted by a Federal Grand jury on June 28, 1963 on twenty grounds of mail fraud.

After these indictments were returned, he severed his relationship with Real Estate Management, Inc., and resigned as a member of the Tennessee Real Estate Commission and, at the same time, surrendered his real estate broker's license. However, he requested and was granted a reissuance of said license for the remainder of the year 1962, but was denied a renewal thereof at a meeting of the Commission on January 9, 1963.

Petitioner was tried and convicted in separate jury trials of each of the crimes for which he was indicted and his convictions in the State Court were upheld by the Tennessee Supreme Court, and his conviction in Federal Court was affirmed by the United States Court of Appeals for the Sixth Circuit.

It appears that petitioner served twenty-one months in the State Penitentiary during 1965 and 1966 until September 2, 1966, at which time his sentences were commuted by the Governor to the time served.

After his release from the Penitentiary, petitioner applied to the Circuit Court of Hamilton County for restoration of his citizenship, which was granted by decree on March 19, 1969. Thereafter, he applied for reinstatement of his real estate broker's license, which application was refused by the Commission at a meeting on January 19, 1970, following which, by letter of February 2, 1970, the petitioner was advised that the Commission would hear evidence as to the petitioner's honesty, truthfulness, integrity and competency, and such hearing was held on April 2, 1970, at which meeting petitioner personally appeared and was represented by counsel. At this hearing evidence was adduced on behalf of the Commission concerning petitioner's criminal convictions and copies of the indictments, judgment of convictions, and opinions of the Appellate Courts affirming those convictions were introduced and put in the record.

Twenty-one character witnesses, including attorneys, accountants, ministers and real estate brokers, appeared on behalf of the petitioner, testifying as to his good reputation and as to his honesty, truthfulness and competency. In addition thereto, certain letters and documents were also introduced on behalf of the petitioner and he testified on his own behalf at the hearing.

Following the foregoing hearing, the Commission entered an order and a supplemental order denying the application for reinstatement of petitioner's license.

The supplemental order of the Commission recites that, pursuant to its duty to pass on the qualifications of a proposed real estate broker and having in mind the public interest involved, it was of opinion and so held that the issuance of a license to Mr. Brown must be denied. In part, the order of the Commission states:

'The standard of conduct of one occupying this petition (real estate broker) . . . must be above reproach. The petitioner herein not only breached this higher standard, but engaged in activities which three separate juries deemed to be of such gravity as to find the petitioner guilty of violating statutes which impose criminal sanctions. Relative to the public interest to which this Commission must direct itself, it is of...