Bowen v. State, Wyoming Real Estate Commission

Citations: 900 P.2d 1140; 1995 Wyo. LEXIS 135; 1995 WL 457874Docket: 94-219

Court: Wyoming Supreme Court; August 4, 1995; Wyoming; State Supreme Court

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Joseph B. Bowen appealed the Wyoming Real Estate Commission's (Commission) one-year suspension of his real estate license to the Supreme Court of Wyoming, which reversed the Commission's decision. Bowen raised three key issues on appeal: 

1. The Commission's jurisdiction to conduct the hearing and suspend his license due to its failure to adhere to its own procedural rules.
2. Whether the Commission's actions were arbitrary and capricious for not following its procedures.
3. The Commission's jurisdiction over contract disputes with Bowen.

The facts indicate that Bowen, a licensed real estate broker, had previously entered into a stipulation with the Commission on February 25, 1993, which placed him on probation for six months due to prior violations. The stipulation required Bowen to surrender his license if he violated any provisions during probation. In August 1993, the Commission alleged Bowen breached the stipulation by advertising property without a written listing agreement and demanded he surrender his license. Upon his failure to do so, a hearing was scheduled for January 14, 1994. Bowen filed a motion to dismiss, claiming procedural violations by the Commission, but it was not addressed. The hearing took place on March 23-24, 1994, resulting in the suspension of Bowen's license based on the failure to obtain a written listing agreement, but not explicitly for breaching the stipulation. The district court certified the case to the Supreme Court for review, which applied appellate standards appropriate for first-instance review.

Administrative agency findings of fact are reviewed under the substantial evidence standard per WYO.STAT. 16-3-114(c)(ii)(E) (1990). The review involves examining the full record to assess if substantial evidence supports the hearing examiner's conclusions, as established in Romero v. Davy McKee Corporation, 854 P.2d 59 (Wyo. 1993). Courts will not replace the hearing examiner’s judgment when substantial evidence exists (Bearden v. State ex rel. Wyoming Workers' Compensation Division, 868 P.2d 268, 1994). Substantial evidence is defined as relevant evidence that a reasonable mind could accept to support the agency's conclusions (Jackson v. J.W. Williams, Inc., 886 P.2d 601, 1994). 

In cases of legal conclusions, courts correct agency errors only when the agency fails to properly apply the law (Thunder Basin Coal Company v. Study, 866 P.2d 1288, 1994). Bowen claims the Commission acted arbitrarily by not adhering to its procedural rules, arguing that it failed to require a written complaint and did not preliminarily consider his case before a hearing. The State conceded procedural violations but contended they were permissible as the rules conflicted with the Wyoming Administrative Procedure Act.

The court emphasizes that an agency's failure to follow its own rules is inherently arbitrary and capricious (State ex rel. Wyoming Workers' Compensation Division v. Brown, 805 P.2d 830, 1991). The State did not provide authority for its claim of proper disregard of the rules, which suggests arbitrary action. The court determined that the compliance of the rules with the Wyoming Administrative Procedure Act is not relevant to this appeal. Consequently, the Commission's order is reversed due to its failure to follow its own procedures.

Bowen also argues that the Commission improperly cited W.S. 33-28-111(a)(xx) for suspending his license. The Commission asserted Bowen did not secure a written listing agreement prior to advertising the property. However, W.S. 33-28-111(a)(xx) does not specify when the written agreement must be obtained, leading to the conclusion that the Commission's interpretation was flawed.

Determining lawmakers' intent is essential in statute interpretation. The inquiry begins with the ordinary meaning of the language used, considering the statute's entirety while ensuring each component is given effect. Statutes should not be extended to matters outside their explicit provisions. In the case at hand, the statute does not mandate obtaining a written listing agreement before a broker can advertise a property, though it suggests such an agreement should exist prior to the property's sale. Previous rulings acknowledged the use of written listing agreements in real estate but did not clarify the timing of when these agreements must be acquired. The legislature allows for oral agreements, as brokers are prohibited from selling property without the owner's consent, which does not need to be in writing. The court determined that the Commission improperly suspended Bowen's license based on W.S. 33-28-111(a)(xx) and acted arbitrarily by not adhering to procedural rules. Therefore, the suspension order is reversed. The court did not address a separate issue regarding the Commission's role in a stipulation contract since it was not considered in the suspension decision.