Khan v. State Bd. of Auctioneer Examiners
| Decision Date | 20 February 2004 |
| Citation | 842 A.2d 936,577 Pa. 166 |
| Parties | Azam KHAN, Appellee v. STATE BOARD OF AUCTIONEER EXAMINERS, Appellant. Azam Khan, Appellant v. State Board of Auctioneer Examiners, Appellee. Abid M. Butt, Appellant v. State Board of Auctioneer Examiners, Appellee. |
| Court | Pennsylvania Supreme Court |
Edgar R. Casper, James G. Morgan, Harrisburg, for Azam Khan and Abid M. Butt.
Steven Vincent Turner, Philadelphia, Bernadette Katherine Paul, Herbert Abramson, John Thomas Henderson, James M. Sheehan, Harrisburg, for State Bd. of Auctioneer Examiners.
Before: CAPPY, CASTILLE, NIGRO, NEWMAN, SAYLOR and EAKIN, JJ.
Promulgated pursuant to the Professions and Occupations Code (Code), Section 20(a)(11) of the Auctioneer and Auction Licensing Act (Act), Act of December 22, 1983, P.L. 327, 63 P.S. § 734.20(a)(11), permits an auctioneer to be disciplined if his or her "license to engage in the auction profession [has been] revoked or suspended or ... other disciplinary action [has been] taken ... by the proper licensing authority of another state." In these consolidated appeals, we decide, inter alia, whether, pursuant to that Section, an auctioneer may be disciplined where the alleged wrongful conduct resulted in a settlement agreement that admitted no fault. Based on the following rationale, we affirm the Order of the Commonwealth Court.
Azam Khan (Auctioneer Khan) and Abid Butt (Auctioneer Butt) (collectively "Auctioneers") are licensed auctioneers in Pennsylvania. On July 16, 1999, Auctioneers were each issued and served with a Notice and Order to Show Cause by the State Board of Auctioneer Examiners (Board), alleging that both Pennsylvania-licensed auctioneers had violated Section 20(a)(11) of the Act, 63 P.S. § 734.20(a)(11),1 because other states had taken disciplinary action against their auctioneer licenses. The Board is the administrative body charged with the authority and responsibility to oversee those engaging in the auctioneering profession within this Commonwealth, and to determine the competency and fitness of a licensee to conduct auctions here. It is imbued by statute with the authority to license auctioneers, investigate complaints, and impose disciplinary sanctions with respect to auctioneer professionals practicing within the Commonwealth. 63 P.S. § 734.31.
Auctioneer Khan's Notice stated that he had violated the Act due to the following actions taken by Virginia and Maine:
• On January 12, 1999, the Virginia Auctioneers Board approved a Consent Order imposing a $1,000.00 administrative penalty against Auctioneer Khan for making a material misrepresentation in the course of performing his auctioneer duties; and
• On December 8, 1997, the Maine Board of Licensing of Auctioneers, through a Consent Agreement, imposed a $250.00 penalty and warned Auctioneer Khan for making misrepresentations in advertisements.
(Original Khan Record, Tab 1.) Auctioneer Khan filed an Answer denying the characterizations of the other state actions as disciplinary actions, explaining that the $1,000.00 he paid to the Virginia Board was not a penalty but merely reimbursement of administrative costs. He also asserted that the Virginia agreement contained no finding that he had made any material misrepresentations.2 Concerning the Maine Consent Agreement, Auctioneer Khan further argued that the agreement made no finding that he violated any rules or regulations of that state, but only provided that he "denies, does not admit, but does not contest allegations of Complaint No. 122." Id.
Before the Board, Auctioneer Khan did not contest the fact that the Maine Consent Agreement constituted a disciplinary action, only that it contained no findings of wrongdoing. His challenge to the Maine agreement was premised primarily on his argument that it would violate the standards set forth by this Court in Lyness v. State Bd. of Medicine, 529 Pa. 535, 605 A.2d 1204 (1992), if the Board took disciplinary action against him based on disciplinary action taken in a state that does not prohibit commingling of prosecutorial and adjudicative functions.3
In Auctioneer Butt's Notice, the Board alleged that he violated the Act due to the following actions taken by Virginia, Texas, and Wisconsin:
• On January 22, 1992, the Virginia Auctioneers Board adopted a Consent Order imposing a monetary penalty of $900.00 against Auctioneer Butt for misleading advertising and for violating requirements to properly execute auction contracts;
• On March 20, 1995, the Texas Commission of Licensing and Regulation, through a Final Order, ordered Auctioneer Butt to cease and desist committing violations involving improper advertising and imposed an administrative penalty of $750.00;
• On November 14, 1996, the Texas Commission of Licensing and Regulation, through a Final Order, imposed an administrative penalty of $500.00 against Auctioneer Butt for misleading advertising; and
• On April 26, 1999, the Wisconsin Auctioneer Board, through a Final Decision and Order, suspended Auctioneer Butt's Certificate of Registration for one year for unprofessional conduct when he failed to disclose disciplinary actions that had been taken against him in the other two states on his application.
(Original Butt Record, Tab 1.) Kahn v. State Bd. of Auctioneer Examiners, 785 A.2d 512 (Pa.Cmwlth.2001).4
In response, Auctioneer Butt filed an Answer arguing that, with regard to the Virginia disciplinary action, he had done nothing wrong and there was no finding of fault or admission of guilt. He also alleged that, because these were minor violations, it was less expensive to pay the fine than to attend a hearing. Concerning the Texas disciplinary actions, he alleged that the omission of his name in an advertisement was a minor oversight by the advertising agent and, at the auction, he forgot to announce his license number or make other legally mandated disclosures. He stated that he merely paid the fines rather than contest the charges at the hearing. As to the second disciplinary action in Texas relative to misleading advertising, he stated that he simply failed to comply with a font requirement.
Regarding the Wisconsin disciplinary action, he denied that he had made a material misstatement and alleged that his failure to disclose disciplinary actions by other states was a mistake made by a temporary employee who filled out his license application. He alleged that this was, at most, supervisory negligence that did not merit a revocation in Pennsylvania.
A consolidated hearing was held before the Board. Neither of the Auctioneers appeared to testify, but counsel argued that it would be unfair or an abuse of the Board's discretion to take disciplinary actions against them based upon the mere fact that disciplinary action had been taken against them in other states. Counsel argued that the imposition of sanctions based on conduct occurring outside this Commonwealth violated substantive and procedural due process. The Board found that it had a legitimate interest in regulating the practice of auctioneering in order to safeguard the public in Pennsylvania, and both Auctioneers had been disciplined by other states for incidents of misconduct that were serious enough to establish a pattern thereby warranting the penalty imposed against Auctioneer Khan and the license revocation of Auctioneer Butt. The State Board of Auctioneers ordered Auctioneer Khan to pay $2,000.00 in civil penalties and revoked Auctioneer Butt's license to practice in Pennsylvania, pursuant to Section 20(a)(11) of the Act.5
Both Auctioneers appealed. The Commonwealth Court consolidated the cases and upheld the constitutionality of the Act with regard to the Board's ability to impose reciprocal discipline. The court also found that both the Virginia and Maine Agreements constituted disciplinary actions, but concluded that the Board could not take action against Auctioneer Khan based upon the Virginia Consent Order. It decided that violations of due process occurred when the Board imposed sanctions based upon another jurisdiction's disciplinary order, where there is neither an admission nor finding of wrongdoing regarding the alleged conduct. It found that the Maine Order could serve as a basis for a sanction in Pennsylvania because Auctioneer Khan had essentially pled nolo contendere in that Consent Agreement. The court vacated and remanded the Board's action with regard to the Virginia discipline of Auctioneer Khan, but upheld the Board's decision regarding Auctioneer Butt. All parties requested reargument, which was denied.
The Board filed a Petition for Allowance of Appeal alleging, inter alia, that the Commonwealth Court should not have vacated the sanction imposed upon Auctioneer Khan. Auctioneer Butt filed a Cross-Petition, contesting his license revocation. Auctioneer Khan filed a Cross-Petition, challenging the finding of the Commonwealth Court that the Maine Order could provide a basis for a sanction pursuant to Section 20(a)(11) of the Act. We granted allowance of appeal to address the important issues raised in these consolidated matters.
Auctioneers Khan and Butt argue before this Court that the infractions resulting in disciplinary action in Virginia, Maine, and Texas were effectively so minor that it was simpler to accede to the proffered settlement agreements than it was to contest the charges. Auctioneer Butt contends that he was disciplined in Virginia and Texas for minor violations and that the Wisconsin disciplinary action resulted from a supervisory error. In the same respect, Auctioneer Khan asserts that the agreements to which he was a party in Maine and Virginia admit of no wrongdoing and should not be characterized as disciplinary actions. The Auctioneers complain that the Board ignored these contentions, which should have mitigated in their favor. We cannot agree. The Board, in a...
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