#### HAROLD E. GOODLEY, DEFENDANT-APPELLANT, v. NEW JERSEY REAL ESTATE COMMISSION, PLAINTIFF-RESPONDENT.

Superior Court of New Jersey Appellate Division

Argued December 14, 1953

Decided January 2, 1954.

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      *Mr. Joseph A. Murphy*argued the cause for New Jersey Eeal Estate Commission *(Mr. Theodore D.*Parsons, Attorney-General, attorney).

*Mr. W. Louis Bossle*argued the cause for defendant-appellant.

Before Judges Clapp, Godmann and Ewart.

The opinion of the court was delivered by

Clapp, S. J. A. D.

Harold E. Goodley, a licensed real estate broker, appeals from a determination of the New Jersey Eeal Estate Commission, finding him guilty of violating *subdivision (e)*of *N. J. S. A.*45:15-17. However, the Commission also found his acts neither willful, nor financially embarrassing to the complainant, Mrs. Lucy Weido, and hence took no penal action — neither suspending nor revoking his license. The statute cited requires the Commission, upon complaint made, to investigate the actions of any real estate broker or salesman and permits it to “suspend * * * or * * * revoke any license * * * where the licensee * * * is deemed to be guilty of: * * * e. Any conduct which demonstrates unworthiness, ineompeteney, bad faith or dishonesty * *

In 1950 Mrs. Weido and her husband bought 503 front feet of land for $3250 through Goodley, as broker, taking *180title by warranty deed from a corporation of which. Goodley was president. Goodley by map and also by references to the map, which are made in the contract and the deed, clearly indicated the boundaries of the property. Two years later, finding, that she and her husband (and in fact the corporation before them) had no title to 135 front feet of this land, she spoke to Goodley, looking for reimbursement. He, notwithstanding repeated requests, said he was not going to do anything about it.

There are several preliminary questions raised by the State over the appealability of the determination. One question is whether the refusal of the Commission to take penal action, after finding Goodley guilty, is to be analogized to a suspended sentence and whether the policy supporting the rule, *R. R.*1:3-4 (5), now authorizing appeals from such sentences (for the practice formerly, see *State v.*Bongiorno, 96 *N. J. L.*318 *(Sup. Ct.*1931)), should apply here. *Cf. Bower v.*State, 135 *N. J. L.*564 *(Sup. Ct.*1947); *City of Newark v. Pulverman,*13 *N. J.*105, 116 (1953). See *N. J. S. A.*45:15-18, as amended *L.*1953, *c.*43. We pass all these questions to get to the merits; for we find, except in point of form, the determination must be affirmed.

The principal issue here is whether the evidence warranted the determination. The Commission found that Goodley’s corporation was “originally at fault in not having a search and survey” at the time it bought the property. But there was no fault here; before the Weidos bought, the corporation had obtained not only a title policy covering a' 300-acre tract including the 503 feet, but also apparently a survey. At any event, as his counsel admits, the deed into the corporate grantor and this title policy put the corporation on notice that certain lands had been conveyed to the State Highway Commission out of the whole tract, though these lands were not described by metes and bounds, but only “by numbered highway stations.” The lands, so conveyed, include or are the 135 feet above mentioned. As the Commission put it in its findings, the corporation gave a “deed of warranty to the * *. * land as onginalty shown to the *181complainant,” and, in that circumstance, “surely a licensed real estate broker,” president of and so closely connected with the grantor, “cannot claim he should not have known just what the corporation * * * could convey.” He should

have ascertained why the exception set forth in the title policy and the deed did not show up on the survey. We conclude there was sufficient proof of negligence by him in connection with his profession, to sustain a finding of incompetency.

In addition to that, there is the matter of “unworthiness.” Goodley told Mrs. Weido, “unfortunately” the Weidos were “the loser,” and he was not going to do anything about it. By way of extenuation, he brings out that the stock of the corporale grantor had been sold to other persons who liad liquidated the corporation, and that it was not until two months later that Mrs. Weido sought reimbursement. On the other hand it might he added he was appointed trustee to disburse the corporate funds to the shareholders on the liquidation of the corporation, and the corporation was apparently still collecting money under installment contracts at the time the defect in title was discovered. At any event, lie himself received one-half of the commissions on the sale of the properly and, as stockholder, something on the salo of the stock. Goodley occupies two roles in this transaction, real estate broker and president of the corporate grantor. However, he cannot, under the circumstances here, escape a charge of unworthiness because the onus of the charge falls in part upon himself in a capacity other than as real estate broker. Wo conclude that under the circumstances his refusal to assist in the rectification of a default brought about by his own negligence justifies a finding of unworthiness.

Tlio word “unworthiness,” in the context here, signifies a lack of those ethical qualities that befit the vocation. *Marrs v.*Matthews, 270 *S. W.*586 *(Tex. Civ. App.*1925); *cf. Woodstown National Bank & Trust Co. v.*Snelbaker, 136 *N. J. Eq.*62 *(Ch.*1944) ; *In re Meyerson,*190 *Md.*671, 59 *A.2d*489, 490 *(Ct. App.*1948). By including the matter of unworthiness in *N. J. S. A.*45:15-17 *(e),*the Legislature *182has charged the Commission with the high responsibility of maintaining ethical standards among real estate brokers and salesmen. The maintenance of those standards serves the vocation well. See *St. Germain v.*Watson, 96 *Cal. App. 2d*862, 214 *P. 2d*99 *(Dist. Ct. App.*1950), hearing denied by Supreme Court, 214 *P. 2d*106 (1950), and *Holland v. Florida Real Estate*Commission, 130 *Fla.*590, 178 *So.*121 *(Sup. Ct.*1938), pointing out that statutes there, rather different from ours in their terms, but nevertheless along the same lines, were designed for those ends. *For*statutes in other states which contain the word unworthiness, see the following cases (which, however, deal with matters not pertinent here): *Leakey v. Georgia Real Estate Commission,*80 *Ga. App.*272, 55 *S. E. 2d*818 *(Ct. App.*1949); *Feight v. State Real Estate Commission,*151 *Neb.*867, 39 *N. W. 2d*823 *(Sup. Ct.*1949).

It was within the competence of the Commission to find Goodley guilty and then, under the circumstances, to refuse to take penal action. However, it was improper in form, indeed grossly so, to have found him guilty, in the disjunctive, of “unworthiness, incompetency, bad faith or dishonesty.” The ultimate finding, duly supported by subsidiary findings, should have been incompetency and unworthiness.

Decision- modified accordingly.