Georgia Real Estate Commission v. Horne, 53295
| Decision Date | 18 January 1977 |
| Docket Number | No. 3,No. 53295,53295,3 |
| Citation | 141 Ga.App. 226,233 S.E.2d 16 |
| Parties | GEORGIA REAL ESTATE COMMISSION et al. v. M. K. HORNE |
| Court | Georgia Court of Appeals |
Arthur K. Bolton, Atty. Gen., Robert S. Stubbs, II, Chief Deputy Atty. Gen., Don A. Langham, Deputy Atty. Gen., Michael J. Bowers, Senior Asst. Atty. Gen., J. Michael Walls, Staff Asst. Atty. Gen., Atlanta, for appellants.
Gambrell, Russell, Killorin & Forbes, Harold L. Russell, James H. Bratton, Jr., Frederick G. Boynton, Atlanta, for appellee.
1. Racial discrimination in housing is a serious problem which demands rectification; to this end Code Ann. § 84-1421 gives the Real Estate Commission the power to suspend or revoke a realtor's license if he so discriminates. However, where the state confers a license to engage in a profession, the license becomes a valuable right which cannot be denied or abridged without due notice and a fair and impartial hearing before an unbiased tribunal. Leakey v. Georgia Real Estate Commission, 80 Ga.App. 272, 55 S.E.2d 818. And the authority which seeks to discipline the license holder must carry the burden of demonstrating the specific violation which justifies the sanction sought. Atlanta Attractions, Inc. v. Massell, 463 F.2d 449 (5th Cir. 1972). We take this to mean that the Real Estate Board must demonstrate that Mr. Horne is guilty of "refusing, because of race, color, national origin or ethnic group, to . . . sell . . . real estate for sale . . . to prospective purchasers" or that he has "demonstrated unworthiness or incompetency to act as a real estate broker or salesman in such manner as to safeguard the interest of the public; or any other conduct . . . which constitutes dishonest dealing." Code Ann. § 84-1421(1) and (25).
The facts in this case are as follows: Mr. Horne represented the owner of a house which was on the market for sale. On July 24, 1974, Mr. and Mrs. Robinson executed an offer to buy the house, the agreement containing "Special Stipulations" that the seller would pay loan discount points up to 41/2 points and that he would provide a termite letter to the effect that the house was free and clear of infestation; it was further agreed that if the cost of securing the termite letter exceeded $100 the seller could rescind the entire contract. On July 25, the seller accepted the Robinsons' offer.
Several days before the closing Mr. Horne learned that the loan had been approved at 5 discount points and that the cost of securing the termite letter would exceed the agreed limit of $100; Mr. Horne however did not disclose to the seller, whom he represented, that the "Special Stipulations" of the contract could not be met. On the day set for the closing the seller, who apparently was having second thoughts about the sale, traveled to Atlanta and met with Mr. Horne; Mr. Horne still did not tell the seller of his options to rescind the contract, or to absorb the excess costs himself or to negotiate with the Robinsons in order to have them absorb the extra costs. It was not until Mr. Horne and the seller reached the office where the closing was to take place that Mr. Horne began to go over the figures with his client.
At that point the prospective buyers arrived; Mr. Horne and the seller, neither of whom had ever met the Robinsons, were surprised to discover that the buyers were black. Mr. Horne thereupon privately telephoned the termite company and told them to increase their estimate of the necessary termite repair and bond from $185 to $507.50. This accomplished, Mr. Horne returned to the closing and told the Robinsons that they would have to absorb additional costs of $625 in order to secure the house, this sum consisting of the excess 1/2 loan discount point and the secretly inflated $507.50 "termite" costs; in truth the additional costs would have been the excess discount points and some $185 in "termite" costs. The Robinsons refused to absorb the purported $625 excess; the transaction did not close.
It was Mr. Horne's testimony that he acted to protect his client, the seller, from charges of racial discrimination that his client was dissatisfied with the contract for purely monetary reasons but since the prospective buyers were black he had to manufacture an "out" so as to avoid charges of racial discrimination. Mr. Horne therefore "upped" the termite letter costs so that the buyers would back out of the sale rather than his client.
The trial judge was of the opinion that the issue was one of motivation was Mr. Horne motivated by racial discrimination or by a desire to protect his client from charges of such discrimination and concluded that all the evidence against Mr. Horne was circumstantial and as equally probative of his theory as that of the Commission; the Commission's finding that Mr. Horne was guilty of racial discrimination was reversed. We disagree with the trial judge's premise that motivation is the crucial element; Code Ann. § 84-1421(1) prohibits racial discrimination in the sale of real estate and the motivation behind a broker's actions is irrelevant if in fact such actions amount to racial discrimination in the sale of property. For example, a broker's " motivation" behind refusing to sell a house in a white neighborhood to a black may be to protect the prospective black buyer from intimidation and harassment by white neighbors but refusing to sell under these circumstances would still be prohibited discrimination.
It is undisputed that the contract for the sale of this house could have been rescinded for the stipulated reasons of excess cost; the option also existed to offer the house to the Robinsons if they would absorb the excess loan discount points and termite costs. The only explanation of why the contract was not rescinded for reasons of excess cost was the expressed desire to avoid charges of racial discrimination; Mr. Horne chose the option to " offer" the house to the Robinsons if they would agree to assume the extra charges but having so chosen he was under the obligation not to discriminate in this offer. And if the sole motivation was to avoid charges of racial discrimination, the Robinsons would have been offered the house at the contract price plus the legitimate excess of discount points and "termite" costs. Instead there is direct evidence that after the discovery that the buyers were black they were presented with the "option" to buy a house at some $625 more than the contract price, of which some $300 was fictitious "termite" cost concocted by Mr. Horne's private telephone call; and this was done in the hope that the Robinsons would "refuse" to close the deal rather than have the seller "refuse" to sell. This is ample evidence to support the finding that Mr. Horne was guilty of racial discrimination in the sale of this house.
The Superior Court of DeKalb County may not "substitute its judgment for that of the agency as to the weight of the evidence on questions of fact" but may reverse the decision if it is "clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record." Code Ann. § 3A-120(h)(5). The record in this case reveals evidence substantiating the Commission's findings of fact and conclusions of law. Georgia Dept. of Human Resources v. Holland, 133 Ga.App. 616(1), 617, 211 S.E.2d 635; Georgia Real Estate Commission v. Hooks, 139 Ga.App. 34, 227 S.E.2d 864.
2. The Superior Court based its reversal in part on an alleged procedural defect in Mr. Horne's hearing that the Commission's deliberations were in public. The court did not in its final order rule the "Sunshine Law," (Code Ann. § 40-3301 et seq.), to be unconstitutional; this court has no jurisdiction to do so. The Superior Court may reverse the Commission's decision if it were in "violation of constitutional or statutory provisions" or "made upon unlawful procedure." Code Ann. § 3A-120(h)(1), (3). The Commission's public deliberations were not only made in full compliance with the law, but would have been nugatory had they been conducted otherwise. Code Ann. § 40-3301. In this regard, the Superior Court was in error.
3. Code Ann. § 3A-114(5) provides for a procedure whereby the Commission may select and appoint a hearing officer to hear a contested case; such a procedure was employed in Mr. Horne's...
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