Title: Bowen v. State, Wyoming Real Estate Com'n

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Bowen v. State, Wyoming Real Estate Com'n1995 WY 124900 P.2d 1140Case Number: 94-219Decided: 08/04/1995Supreme Court of Wyoming
Joseph 
B. BOWEN, 

Appellant 
(Petitioner),

v.

STATE 
of Wyoming, WYOMING REAL ESTATE COMMISSION, 

Appellee 
(Respondent).

Frank 
J. Jones, Wheatland, for appellant.

Joseph 
B. Meyer, Atty. Gen.; Bill Hibbler, Sr. Asst. Atty. Gen.; and Dona Playton, 
Asst. Atty. Gen., for appellee.

Before 
GOLDEN, C.J., and THOMAS, MACY, TAYLOR and LEHMAN, JJ.

MACY, 
Justice.

[¶1]  Appellant Joseph Bowen appealed to the 
district court from the order in which Appellee Wyoming Real Estate Commission 
suspended his real estate license for a period of one year. The district court 
certified the case to this Court pursuant to W.R.A.P. 12.09(b).

[¶2]  We reverse.

Issues

[¶3]      Bowen presents 
three issues for our consideration on appeal:

1. 
Did the Wyoming Real Estate Commission have jurisdiction to conduct the 
contested hearing and enter its order suspending the license of Petitioner 
Joseph B. Bowen when it failed to follow its own rules of practice and 
procedure?

2. 
Was the action of the Wyoming Real Estate Commission in failing to follow its 
own rules of practice and procedure arbitrary and capricious?

3. 
Did the Wyoming Real Estate Commission have jurisdiction to decide contract 
disputes between itself and the Petitioner Joseph B. Bowen?

Facts

[¶4]      On February 25, 
1993, Bowen, who was a licensed real estate broker, and the Commission entered 
into a stipulation which settled claims against Bowen for his violations of the 
statutory and regulatory provisions applicable to real estate brokers and sales 
persons. In that stipulation, Bowen agreed to be put on probation for a 
six-month period. The stipulation stated:

If 
Bowen is found to have violated any provisions of the Real Estate Licensing Act 
of 1971 or Real Estate Commission Rules and Regulations during the probationary 
period, he shall immediately and voluntarily surrender his license to the 
Commission and shall cease performing any actions as a real estate broker or 
salesman[.]

The 
stipulation also provided that the Commission would retain continuing 
jurisdiction "to take any action deemed proper" in the matter.

[¶5]      In an August 31, 
1993, letter addressed to Bowen's attorney, the Commission demanded that Bowen 
immediately surrender his license. The Commission alleged that Bowen had 
breached the terms of the stipulation when he advertised property for sale 
without first obtaining a written listing agreement from the property owner. 
When Bowen failed to surrender his license, a notice was sent to him, advising 
him that a hearing had been scheduled for January 14, 1994, so that the possible 
revocation of his license could be considered. The notice stated: "It is alleged 
that Broker Bowen has violated W.S. 33-28-111(a)(xx) or violated the terms of 
the Stipulation, Docket No. 92-019, entered February 25, 1993." Bowen responded 
to the notice by filing a motion to dismiss on the grounds that the Commission 
had failed to follow its procedural rules in instituting the disciplinary matter 
against him. The Commission did not rule on Bowen's motion to 
dismiss.

[¶6]      A hearing was 
held on March 23 and 24, 1994, before a hearing examiner and the Commission. 
After considering the hearing examiner's recommendations, the Commission 
suspended Bowen's real estate broker's license for a one-year period. The 
Commission specified that Bowen's license was being suspended under § 
33-28-111(a)(xx) because he had failed to obtain a written listing agreement. 
The Commission did not state that Bowen's license was being suspended because he 
had allegedly breached the terms of the stipulation.1

[¶7]      Bowen appealed to 
the district court, and that court certified the case to us pursuant to W.R.A.P. 
12.09(b).

Discussion

[¶8]      When we are 
reviewing cases which have been certified to us pursuant to W.R.A.P. 12.09(b), 
we apply the appellate standards which are applicable to the reviewing court of 
the first instance. Hepp v. State ex rel. Wyoming Workers' Compensation 
Division, 881 P.2d 1076, 1077 (Wyo. 1994).

[¶9]  We review an administrative agency's 
findings of fact by applying the substantial evidence standard. WYO. STAT. § 
16-3-114(c)(ii)(E) (1990). Our task is to examine the entire record to determine 
whether substantial evidence supported the hearing examiner's findings. Romero 
v. Davy McKee Corporation, 854 P.2d 59, 61 (Wyo. 1993). We will not substitute 
our judgment for that of the hearing examiner when substantial evidence supports 
his decision. Bearden v. State ex rel. Wyoming Workers' Compensation Division, 
868 P.2d 268, 269 (Wyo. 1994). Substantial evidence is relevant evidence which a 
reasonable mind might accept in support of the agency's conclusions. Jackson v. 
J.W. Williams, Inc., 886 P.2d 601, 603 (Wyo. 1994). With regard to an agency's 
conclusions of law, we rectify that agency's errors when the agency has not 
invoked and correctly applied the proper rule of law. Thunder Basin Coal Company 
v. Study, 866 P.2d 1288, 1291 (Wyo. 1994).

[¶10]  Bowen argues that, because the 
Commission failed to follow its own procedural rules in bringing the charges 
against him, the Commission acted arbitrarily and capriciously and failed to 
perfect jurisdiction over him. Specifically, Bowen maintains that the Commission 
violated its procedural rules by failing to require that a written complaint be 
filed against him and served upon him and by failing to preliminarily consider 
his case before scheduling it for a hearing. The State concedes that the 
Commission did not follow its own procedural rules when it initiated the 
disciplinary action against Bowen but argues that the Commission properly 
disregarded the rules because they were in contravention of the Wyoming 
Administrative Procedure Act.

[¶11]  This Court has stated:

Underlying 
our often repeated statement that "`[i]n determining whether the action of an 
agency is arbitrary, capricious, or an abuse of discretion, the court ascertains 
whether the decision is supported by the record,'" Cook [v. Zoning Board of 
Adjustment for the City of Laramie], 776 P.2d [181,] 185 [(Wyo. 1989)] (. . . 
quoting Holding's Little America v. Board of County Com'rs of Laramie County, 
670 P.2d 699, 703-04 (Wyo. 1983)), is the assumption that an agency will abide 
by the rules it promulgates. The failure of an agency to abide by its rules is 
per se arbitrary and capricious.

State 
ex rel. Wyoming Workers' Compensation Division v. Brown, 805 P.2d 830, 835 (Wyo. 
1991). The State did not provide us with any pertinent authority for its 
assertion that the Commission acted properly by disregarding its rules. That 
statement, in and of itself, suggests that the Commission acted arbitrarily and 
capriciously by choosing, in an individual case, whether or not to follow its 
rules of procedure. The question of whether the rules were in compliance with 
the Wyoming Administrative Procedure Act is not properly before the Court in 
this appeal. In accordance with our holding in Brown, we must reverse the 
Commission's order because the Commission acted arbitrarily and capriciously by 
failing to follow its own rules. WYO. STAT. § 16-3-114(c)(ii)(A) 
(1990).

[¶12]   Bowen further contends that the 
Commission improperly relied on § 33-28-111(a)(xx) as being the statutory 
authority for suspending Bowen's license. We agree.

[¶13]   The Commission found that Bowen had 
failed to obtain a written listing agreement from the property owner before he 
advertised the property for sale in a written publication. Under § 
33-28-111(a)(xx):

(a) 
The commission shall upon a written sworn complaint or may upon its own motion 
investigate the actions of any broker, associate broker or salesman and may 
censure the licensee, suspend or revoke any license issued under this act [§§ 
33-28-101 to -206] for any of the following:

. 
. . . .

(xx) 
Failing to obtain written listing agreements identifying the property and 
containing all terms and conditions under which the property is to be sold 
including the price, the commission to be paid, the signatures of all parties 
concerned and a definite expiration date[.]

[¶14]   The Commission interpreted the 
statutory provision as requiring that a broker must obtain a written listing 
agreement prior to advertising the property for sale. Section 33-28-111(a)(xx) 
does not, however, expressly state when the written listing agreement must be 
obtained.

[¶15]   Determining the lawmakers' intent 
is our primary focus when we are interpreting statutes. Christensen v. 
Oedekoven, 888 P.2d 228, 230 (Wyo. 1995). Initially, we make "`an inquiry 
respecting the ordinary and obvious meaning of the words employed according to 
their arrangement and connection.'" Parker Land and Cattle Company v. Wyoming 
Game and Fish Commission, 845 P.2d 1040, 1042 (Wyo. 1993) (quoting Rasmussen v. 
Baker, 7 Wyo. 117, 133, 50 P. 819 (1897)). We construe the statute as a whole, 
giving effect to each word, clause, and sentence, and we construe together all 
parts of the statute in pari materia. 845 P.2d  at 1042. Similarly, we refuse to 
enlarge, stretch, expand, or extend a statute to matters which do not fall 
within its express provisions. Wyrulec Company v. Schutt, 866 P.2d 756, 759 
(Wyo. 1993).

[¶16]   The statute does not contain any 
language which states that the written listing agreement must be obtained before 
a broker may advertise the property, although the "is to be sold" language 
indicates that a written listing agreement should be obtained before the 
property is actually sold. See Wyoming Realty Company v. Cook, 872 P.2d 551 
(Wyo. 1994). In Cook, this Court recognized a special statute of frauds 
applicable to real estate listings when it held that Wyoming's statutes and the 
Commission's rules contemplate the use of written listing agreements by brokers. 
872 P.2d  at 552-53. That decision was not, however, made in the context of a 
disciplinary action brought against a real estate broker for failing, under the 
provisions of § 33-28-111(a)(xx), to obtain a written listing agreement. 
Additionally, we did not specify in the Cook decision when the written listing 
agreement must be obtained. The Legislature recognized the possibility that 
brokers and property owners may initially enter into oral listing agreements 
when it forbade brokers from offering property for sale without the owners' 
knowledge or consent, but it did not require that such consent be memorialized 
in writing. WYO. STAT. § 33-28-111(a)(viii) (1987).

[¶17]   The Legislature has the duty to 
determine the disciplinary standards applicable to real estate brokers and sales 
persons. This Court will not expand the provisions of § 33-28-111(a)(xx) by 
requiring a broker to obtain a written listing agreement before he advertises 
the property for sale. The Commission, therefore, erred when it relied on § 
33-28-111(a)(xx) to suspend Bowen's license.

Conclusion

[¶18]   We hold that the Commission acted 
arbitrarily and capriciously by failing to follow its rules of procedure and 
that it improperly relied upon § 33-28-111(a)(xx) to suspend Bowen's license. 
The Commission's order is, therefore,

[¶19]  Reversed.

Footnotes

1 
Since the Commission did not rely on the stipulation in entering its suspension 
order, we have no reason to consider Bowen's third issue which questions whether 
the Commission, as a party to the stipulation contract, could rule on a dispute 
over the terms of the contract.