State Dept. of Commerce, Real Estate Div. v. Soeller
| Decision Date | 29 December 1982 |
| Docket Number | 12547,Nos. 12418,s. 12418 |
| Citation | 656 P.2d 224,98 Nev. 579 |
| Parties | STATE of Nevada DEPARTMENT OF COMMERCE, REAL ESTATE DIVISION, Appellant, v. Clemens F. SOELLER, Respondent. Mavis L. LUND; Lowell Thomas; Sybil W. Thomas; Tnt Investments, Inc., a Nevada Corporation, dba Sierra Realty, Appellants, v. NEVADA REAL ESTATE DIVISION, DEPARTMENT OF COMMERCE, State of Nevada, Respondents. |
| Court | Nevada Supreme Court |
Richard H. Bryan, Atty. Gen., Franklin C. Hoover and Steven F. Stucker, Deputy Attys. Gen., Carson City, for State of Nevada, Dept. of Commerce, Real Estate Div.
Johnson, Belaustegui & Robinson, Reno, for Clemens F. Soeller.
Raggio, Wooster, Clontz & Lindell, Reno, for Mavis Lund.
David K. Baba, Reno, for Lowell Thomas and Sybil Thomas.
The Nevada Real Estate Advisory Commission found realtors Clemens Soeller, Mavis Lund, Sybil Thomas and Lowell Thomas in violation of NRS 645.630 and the rules and regulations promulgated thereunder based on their conduct concerning a particular real estate transaction. The Commission also found Soeller and Lund in violation of the Real Estate Code of Ethics.
The Commission ordered the revocation of Lund's license and ordered thirty-day suspensions of the licenses of Soeller and the Thomases.
Pursuant to NRS 645.760(2), Lund, Soeller and the Thomases appealed from the Commission's orders to the district court. Judge Torvinen vacated the license suspension of Soeller. Judge Breen sustained the revocation of Lund's license and the suspension of the Thomases' licenses.
In Case No. 12418, the Real Estate Division appeals from the district court order granting relief to Soeller. Lund and the Thomases appeal from the order sustaining the decision of the Commission in Case No. 12547. The two cases are consolidated for purposes of this appeal.
The fundamental issue in each case is whether there is substantial evidence in the record to support the Commission's decision. We hold that substantial evidence exists, and we therefore reverse the district court's order in Case No. 12418 and affirm the district court's order in Case No. 12547.
Clemens F. Soeller, qualifying broker of Crystal Shores Realty, listed for sale the Lake Tahoe property of Mr. and Mrs. James DeWitt Bennett, who reside in Southern California. Mavis Lund, a salesperson associated with Tahoe Sierra Realty, made an offer on her own behalf to purchase the property at the listed price of $63,500, contingent on her obtaining financing. Lund prepared and signed a standard purchase agreement and earnest money receipt that acknowledged receipt of an earnest money deposit of $1,000 by Tahoe Sierra Realty. However, Lund never deposited that earnest money. Moreover, the purchase agreement did not contain any date for the close of escrow. Soeller did not review the document before it was sent to the Bennetts. The Bennetts accepted Lund's offer. Lund opened an escrow without depositing any earnest money, and never formally closed it.
Lund was unable to obtain financing for the purchase, and communicated this information to Soeller. Because Soeller was about to leave for a vacation, he told Lund to deal directly with the Bennetts. Lund called Mrs. Bennett and withdrew her offer, and Mrs. Bennett acceded to that withdrawal. No written cancellation of the Bennett-Lund "escrow" was ever made. Soeller stated that he left the cancellation of the deal to Lund because she "wrote the deal out ... it was her responsibility ...."
Mrs. Bennett held a power of attorney for her husband, who was in the merchant marine. She subsequently informed both Lund and Soeller that she wished to increase the listed price to $67,500, and a change order for the Multiple Listing Service was prepared. 1 Soon thereafter, one of Lund's colleagues approached Lund about a client, Carmen Sylvia Howarth, who was interested in purchasing the Bennett property. Lund expressed willingness to sell the property for $67,500, and Howarth offered that price. Lund contacted Soeller, and Soeller presented the offer to the Bennetts.
Soeller explained to Mrs. Bennett that Lund was going to buy her property at $63,500 and "double escrow" it to another party at $67,500. He stated that it was legal, and when she questioned him about the Lund cancellation, he said that Lund "still had it, that it was still okay ...." Upon Mr. Bennett's return home from sea, Soeller informed him of the new offer, but explained that the Bennetts would net the same amount they would have netted at the old price due to a different commission split. Soeller's commission was to remain the same as it was on the $63,500. Thus, Soeller would receive, $1,778 (40% of 7% of $63,500) and Tahoe Sierra Realty would get $6,667 (60% of 7% of $63,500, plus $4,000). Soeller testified that he told the Bennetts that Tahoe Sierra "felt they were entitled to [the commission], or they would take the buyer and go somewhere else," and that the commission payment was part of the offer. 2 The Bennetts accepted the offer. 3
No fewer than three, and perhaps more, sets of escrow instructions were prepared. Eventually the double escrow from the Bennetts to Lund and from Lund to Howarth was abandoned, and a single escrow was established between the Bennetts and Howarth. The escrow instructions denoted Howarth as "nominee for Mavis Lund." Howarth had no previous knowledge that this relationship would exist. Howarth had thought that Lund was the listing agent for the property; she did not hear of Soeller, the actual listing broker, until contacted by the Division after the sale. 4 She, like the Bennetts, did not fully comprehend why Lund was involved in the transaction. While Howarth suspected a double escrow, she was mainly concerned with obtaining clear title to the property at the price she had offered. Mr. Thomas, owner of Tahoe Sierra Realty and Lund's supervising broker, testified that he had insisted on two separate transactions (Bennett-Lund and Lund-Howarth), but that the escrow company informed him that since everyone was informed and no one was unhappy, there was no need for two transactions.
The purchase was finally completed in a single transaction, with title passing directly from the Bennetts to Howarth. Soeller received $1,778, and Tahoe Sierra received $2,667, as commissions on the $63,500 sale. Lund ultimately received the $2,667 commission. The additional $4,000 was apparently the commission on the "second" sale at $67,500. The broker, Tahoe Sierra Realty, owned by the Thomases, took $1,417.50, which is 30% of $4,000; the selling agent took 45%, or $2,126.25; and Lund received the remaining $456.25 as her profit from the "sale". Mr. Thomas testified that he paid commissions based on two escrows, even though he knew there was only one, because Lund was acting as nominator and it was fully disclosed to the sellers and the buyer that there would be two escrows and a $6,667 commission. Lund received a total of $3,123.25 from the transaction.
On appeal, we are limited to determining whether the decision of the Commission constitutes an abuse of discretion. NRS 645.760(3); Alley v. Nevada Real Estate Div., 94 Nev. 123, 575 P.2d 1334 (1978); Holland Rlty. v. Nev. Real Est. Comm'n, 84 Nev. 91, 436 P.2d 422 (1968); Barnum v. Williams, 84 Nev. 37, 436 P.2d 219 (1968); Randono v. Nev. Real Estate Comm'n, 79 Nev. 132, 379 P.2d 537 (1963). The Commission's action is not an abuse of discretion if it is supported by substantial evidence in the record. Lellis v. Archie, 89 Nev. 550, 516 P.2d 469 (1973); No. Las Vegas v. Pub. Serv. Comm'n, 83 Nev. 278, 429 P.2d 66 (1967); Randono v. Nev. Real Estate Comm'n, supra.
The Commission concluded that Clemens Soeller violated NRS 645.630(9) and (18); Real Estate Division Rules and Regulations Section VII(6); and the Real Estate Code of Ethics Part II(2) and (14). 5 The stated basis for this conclusion was Soeller's failure to secure a definite time for close of escrow on the original Lund offer and his failure to obtain written cancellation instructions for the Bennett-Lund escrow. The Commission did not make separate findings of fact to uphold this particular conclusion; however, the conclusion itself gives notice of the facts on which the Commission relied. Under such circumstances we may imply the necessary factual findings, so long as the record provides substantial evidence to support the Commission's conclusion. See Gorden v. Gorden, 93 Nev. 494, 569 P.2d 397 (1977); Lewis v. State, 86 Nev. 889, 894, 478 P.2d 168, 171 (1970); Richfield v. Harbor, 85 Nev. 185, 452 P.2d 462 (1969). Compare with Pub. Serv. Comm. v. Continental Telephone Co., 94 Nev. 345, 580 P.2d 467 (1978) ().
There was testimony indicating that the Bennetts did not believe that they were legally obligated to accept the second offer involving the $4,000 "commission" to Tahoe Sierra Realty, and that they were anxious to sell because the house would become increasingly difficult to show as winter approached. However, the record also indicates that Soeller flatly told the Bennetts that if they did not accept the syphoning to the other broker of the margin between the original price and the increased price, the broker would take the buyer elsewhere. Moreover, Mr. Bennett testified that he believed he could get into trouble by refusing a legitimate offer, that Soeller led him to believe Lund's offer at $63,500 was still legally operative, and that the sale to Howarth involving Lund was legal because it was a "double escrow." The Commission apparently relied on the latter testimony, and determined that the degree of disclosure that occurred in this case was insufficient to discharge Soeller's duty to his principal.
We may not substitute our judgment for that of the Commission by weighing the evidence or passing on the credibility of...
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