ORDERS:
FINAL ORDER AND DECISION
This matter is before the Administrative Law Judge Division ("ALJD") pursuant to the Appellant's appeal from the decision of the
South Carolina Real Estate Commission ("Commission") dated November 30, 1999. For the following reasons, the decision of the
Board is hereby affirmed.
I. FACTUAL BACKGROUND
Alice H. Swope, Appellant, is a licensed real estate broker working in Charleston, South Carolina. On September 18, 1998,
Appellant met Thomas and Joye Ridgeway ("Ridgeways") while they were inspecting a parcel of commercial property that was for
sale. Appellant offered her assistance to the Ridgeways, and they consented to her finding out more information about the property.
Appellant contacted Alline S. Wheaton, also a real estate agent, whose name was on the property's "For Sale" sign. On Friday,
September 19, 1998, Appellant, Wheaton, and the Ridgeways met at the property. The next day, Appellant met with the Ridgeways
at her office to discuss the property and financing options. Appellant prepared a buyer's representation agreement, but the Ridgeways
did not sign this form. Appellant also prepared an offer on the property.
On Sunday, September 21, 1998, Appellant met with Ms. Wheaton. Appellant and Wheaton entered into a written One Time
Showing Agreement by altering the Exclusive Right to Sell Listing Agreement. Appellant disclosed to Wheaton that she was
representing the Ridgeways in this
transaction, and Wheaton made a written counter-offer. Appellant did not obtain Wheaton's signature or the Ridgeways' signature on
a written dual agency disclosure form.
On Monday, September 22, 1998, the real estate transaction between the Ridgeways and Wheaton failed. The Ridgeways terminated
their relationship with Appellant and ultimately filed a complaint against Appellant with the Real Estate Commission.
During the investigation of this complaint and prior to any formal charges being filed against Appellant, two members of the
investigative staff of the Real Estate Commission contacted Appellant by telephone. The investigators were aware that Appellant had
retained counsel; however, the investigators did not contact Appellant's counsel nor did Appellant's attorney participate in the
telephone conversation between Appellant and the investigators. The Appellant and the investigators discussed the pending
disciplinary matter, but no resolution was reached.
A formal complaint was served on Appellant on June 8, 1999 accusing Appellant of violating S.C. Code Ann. § 40-57-135(D)(4)
(Supp. 1998), S.C. Code Ann. § 40-57-145(A)(13) (Supp. 1998), and S.C. Code Ann. § 40-57-145(A)(15) (Supp. 1998). A hearing
was held before the Commission on July 21, 1999. At the hearing, Appellant moved to dismiss the charges against her on the
grounds that the communication between her and the investigators, outside the presence of her counsel, violated her due process
rights and that fairness mandated that the charges be dismissed. The Commission denied this motion, holding that Appellant suffered
no prejudice from the Commission. The Commission issued a Final Order on November 30, 1999, finding that the Appellant
violated S.C. Code Ann. § 40-57-135(D)(4) (Supp. 1998) because she failed to get the Ridgeways' signature on the buyer's
representation agreement, and S.C. Code Ann. § 40-57-145(A)(13) and (15) (Supp. 1998) because she failed to inform the Ridgeways
and Wheaton that she would be acting as a dual agent. Appellant appeals this decision.
II. STANDARD OF REVIEW
Jurisdiction on appeal from a decision of a Commission within the Department of Labor, Licensing and Regulation is vested in the
ALJD pursuant to S.C. Code Ann. § 1-23-600(D) (Supp. 1999). On appeal to the ALJD, the standard of review is limited to the
record presented. S.C. Code Ann. § 1-23-380(A)(5) (Supp. 1999). An Administrative Law Judge may reverse or modify the
agency's decision if substantial rights of the appellant have been prejudiced because the administrative findings, inferences,
conclusions or decisions are affected by error of law or clearly erroneous in view of the reliable, probative, and substantial evidence
in the whole record. S.C. Code Ann. § 1-23-380(A)(6) (Supp. 1999); Stephen v. Avins Const. Co., 324 S.C. 334, 478 S.E.2d 74 (Ct.
App. 1996). Substantial evidence is neither a mere scintilla of evidence nor evidence viewed blindly from one side of a case, but
rather is evidence which, considering the record as a whole, would allow reasonable minds to reach the conclusion that the
administrative agency reached. Carroll v. Gaddy, 295 S.C. 426, 368 S.E.2d 909 (1988). A decision will not be set aside simply
because reasonable minds may differ on the judgment. Lark v. Bi-Lo, 276 S.C. 130, 276 S.E.2d 304 (1981). The fact that the record,
when considered as a whole, presents the possibility of drawing two inconsistent conclusions from the evidence does not prevent the
agency's finding from being supported by substantial evidence. Waters v. South Carolina Land Resources Conservation Comm'n,
321 S.C. 219, 467 S.E.2d 913 (1996). In applying the substantial evidence rule, the factual findings of the administrative agency are
presumed to be correct. Rodney v. Michelin Tire Co., 320 S.C. 515, 466 S.E.2d 357 (1996).
III. DISCUSSION
At the time this matter arose, S.C. Code Ann. § 40-57-135(D)(4) (Supp. 1998) provided that "a listing or buyer's representation
agreement must be in writing and must set forth all material terms of the parties' agency relationship . . ." In conjunction with this
statute, S.C. Code Ann. § 40-57-139(A)(1) (Supp. 1998) states that a licensee shall provide in a timely manner to all buyers and
sellers with whom the licensee works "a meaningful explanation of agency relationships in real estate transactions." The
Commission and LLR read these two statutes together and hold that these statutes create a duty upon an agent to timely provide to
buyer clients a written representation agreement setting forth the required material terms of the parties' relationship.
It is well settled law in South Carolina that an administrative agency's construction of its statutes will generally be respected. "The
construction of a statute by the agency charged with its administration will be accorded the most respectful consideration and will not
be overruled absent compelling reasons." Dunton v. South Carolina Board of Examiners in Optometry, 291 S.C. 221, 223, 353
S.E.2d 132, 133 (1987).
In the instant case, the Commission held that Appellant did not timely provide the Ridgeways with this agreement and, therefore,
violated S.C. Code Ann. § 40-57-135(D)(4). Although the Appellant's relationship with the Ridgeways only lasted a few days,
Appellant met with the Ridgeways at least three times. Therefore, I find that, even though a reasonable person may reach a different
conclusion, substantial evidence exists to support the Commission's finding that Appellant violated S.C. Code Ann. § 40-57-135(D)(4) (Supp. 1998).
The Commission also held that Appellant violated S.C. Code Ann. § 40-57-145(A)(13) and (15) (Supp. 1998). S.C. Code Ann. § 40-57-145(A)(13) provided that the Commission could deny issuance of a license to an applicant or take disciplinary action against a
licensee who "fails to disclose in accordance with Section 40-57-139 the party or parties for whom the licensee will be acting as an
agent in a real estate transaction." S.C. Code Ann. § 40-57-145(A)(15) provided that the Commission could deny issuance of a
license or take disciplinary action against a licensee who "represents more than one party in a real estate transaction without the full
written knowledge and consent of all parties the licensee represents as provided in Section 40-57-137(M)." S.C. Code Ann. § 40-57-137(M) provided that "a licensee may act as a disclosed dual agent only with the prior informed and written consent of all parties."
The Commission found that Appellant violated the above statutes because she failed to get the Ridgeways or Ms. Wheaton to sign a
dual agency disclosure and consent form. Ms. Wheaton argues that she never intended to create an agency relationship between
herself and Ms. Wheaton; however, Ms. Wheaton and Appellant signed an agreement which clearly stated that Ms. Wheaton, as the
owner of the property, was employing Ms. Swope to be the "sole and exclusive agent" for the property. Since Appellant had also
agreed to represent the buyers in this transaction, there is substantial evidence in the record to support a finding that a dual agency
relationship was created which required the prior informed and written consent of all the parties. S.C. Code Ann. § 40-57-137(M)
(Supp. 1998). Therefore, I find that substantial evidence exists to support the Commission's findings that Appellant violated S.C.
Code Ann. § 40-57-145(A)(13) and (15) (Supp. 1998).
Finally, Appellant argues that the ex parte communication between Appellant and the member of the Commission's Investigative
Committee violated her due process rights and was prejudicial to her case and, therefore, the Commission's Order should be reversed.
I find that the contact between the Committee member and Appellant was not ex parte communication because it was not held
outside the presence of the Appellant. It was held outside the presence of Appellant's counsel. Also, it was not held with the
decision makers which are the members of the Commission. While I find the actions of the Investigative Committee in this case to be
egregious, I find that the Appellant's due process rights were not violated and her case was not prejudiced so as to require the
Commission's decision to be overturned.
ORDER
IT IS THEREFORE ORDERED that the Appellant's appeal is denied, and the Order of the Commission is hereby AFFIRMED.
AND IT IS SO ORDERED.
_______________________________
C. DUKES SCOTT
ADMINISTRATIVE LAW JUDGE
September 14, 2000
Columbia, South Carolina |
