In late 2012, the Third Appellate District provided some guidance for the DRE on what is sufficient rehabilitation for a prospective licensee to receive a license.
Dave Singh was a police officer in Northern California until 2004. Singh’s father, Sarbjit, was 70 years old and disabled. Singh learned that IHSS (In Home Supportive Services) provided services and funds that allowed disabled persons to remain in their home with family members providing assistance. Singh’s wife initiated the process to obtain these benefits for Sarbjit. In October of 2001, Sarbjit and his wife went to India and ended up staying three months after Sarbjit suffered a stroke. Sarbjit illegally continued to receive IHSS payments during that time period.
After a fraud investigation, Singh was charged with presentation of a fraudulent claim and grand theft by false pretenses for his role in collecting the benefits after his father left the country. He was eventually convicted of a misdemeanor and granted Singh three years of probation. Singh lost his job as a police officer as a result of the conviction. Singh’s probation was terminated in January 2007.
In 2006, Singh applied for a real estate broker’s license, but was denied based on the DRE’s opinion that he had not gone though adequate rehabilitation. He again applied in 2008, and was again denied. The explanation for denial was because of the “dishonest nature” of his prior conviction for theft by false pretenses and the concern that it would not be in the public interest to issue Singh a license.
Singh petitioned for a writ of administrative mandamus (under Code Civ. Proc., § 1094.5) to set aside the Commissioner’s decision, contending that he was entitled to a broker’s license because he had met all criteria for rehabilitation. Finding the Commissioner failed to proceed in the manner required by law, the trial court granted the petition and issued the writ of mandate, granting Singh the license.
The Commissioner appealed, claiming the trial court erred in finding that Singh met all criteria of rehabilitation. He further claimed there was substantial evidence that Singh had not demonstrated a sufficient change in attitude because he failed to take full responsibility for his crime. The appellate court agreed with the trial court that, based on the findings set forth in the decision, the Commissioner’s decision to deny Singh a broker’s license was improperly based solely on the nature of his prior crime, rather than his inadequate rehabilitation. On that basis, the appellate court affirmed.
The case goes on to discuss what it considered to be the improper basis for the DRE’s denial. The DRE has developed 14 criteria to be used to evaluate rehabilitation of an applicant for a license who has committed a crime. Of the many criteria, arguably the most important in predicting future conduct is subdivision(n): “Change in attitude from that which existed at the time of the conduct in question.”
The Court found that Singh’s application was denied to protect the public interest, safety and welfare “given the dishonest nature” of his crime. Change of attitude was not the basis for finding Singh’s rehabilitation was insufficient. The Court therefore found that the DRE’s basis for denial was based on the wrong standard, and that the DRE Commissioner “ha[d] not proceeded in the manner required by law” and the “decision [was] not supported by the findings,” so there was a prejudicial abuse of discretion.
This case is important because it shows that the Courts are not afraid to usurp the DRE’s authority and overturn unsupported decisions. It will be interesting to monitor if this leads to additional challenges to DRE licensing decisions.
If you or someone you know is interested in seeking legal counsel regarding such matters, don’t hesitate to contact Brewer Offord & Pedersen LLP at (650) 327 – 2900 or visit us on the web at www.BrewerFirm.com.