read decision here.
read Appeal here.
2212 DOS 07
STATE OF NEW YORK
DEPARTMENT OF STATE
OFFICE OF ADMINISTRATIVE HEARINGS
----------------------------------------X
In the Matter of the Complaint of
DEPARTMENT OF STATE
DIVISION OF LICENSING SERVICES,
Complainant, DECISION
-against-
ROBERT G. BUCKLES, JR.,
Respondent.
----------------------------------------X
The above noted matter came on for hearing before the undersigned, Scott NeJame, on October 16, 2006, February 12, 2007 and February 15, 2007 at the office of the Department of State located at 41 State Street, Albany, New York.
On October 16, 2006, neither the respondent nor his attorney appeared. On February 12, 2007 and February 15, 2007, the respondent appeared and was represented by Henri Shawn, Esq., 30 North Street, Suite 1, P.O. Box 1320, Monticello, New York 12701-1320.
At all hearing sessions, the complainant was represented by Associate Attorney Whitney A. Clark, Esq.
COMPLAINTS
The complaint in this matter alleges that the respondent, a certified general real estate appraiser, prepared and communicated three appraisal reports which contained multiple violations of the Uniform Standards of Professional Appraisal Practice1 (“USPAP”). It is also alleged that the respondent violated Executive Law §160-d, demonstrated negligence and incompetence in developing, preparing and communicating appraisals in violation of Executive Law §160-u(h), violated the standards for the development or communication of real estate appraisals as provided in Executive Law Article 6-E in violation of Executive Law §160-u(f), and committed an act of dishonesty, fraud and misrepresentation which substantially benefitted himself in violation of Executive Law §160-u(e).
PROCEEDINGS
The notice of hearing initially scheduling the hearing for August 14, 2006 together with the complaint was served on the respondent by certified mail delivered on June 19, 2006 (State’s Ex. 1). Based on adjournment requests made, the tribunal adjourned the hearing first to September 20, 2006 and then to October 16, 2006 (State’s Ex. 2).
On October 16, 2006, the hearing was held in the respondent’s absence. The complainant called three witnesses to testify and introduced fifteen exhibits which were admitted into evidence (State’s Ex.’s 1-15).
By letter dated October 23, 2006, the respondent’s previous attorney, Heather Q. Wallace, Esq. of Penino & Moynihan, LLP, submitted her notice of appearance and requested the hearing be re-opened and placed back on the tribunal’s calendar. Based on the complainant’s consent, the tribunal re-opened the hearing and scheduled it to be held on November 13, 2006.
By letter dated October 27, 2006, the respondent’s present attorney, Mr. Shawn, requested an adjournment of the hearing and the tribunal adjourned it to December 11, 2006.
By letter dated November 13, 2006, Mr. Shawn requested the tribunal adjourn the hearing to January 2007. After an exchange of letters between the tribunal and Mr. Shawn, and due, in part, to Mr. Shawn not having received the hearing transcript from the October 16, 2006 hearing session, and after learning that it was likely that more than one future hearing session would be needed to complete the hearing, the tribunal adjourned the hearing to January 22, 24, and 29, 2007 and February 7 and 8, 2007, in that order, and as necessary, to complete the hearing.
On November 29, 2006, the tribunal received the hearing transcript for the October 16, 2006 hearing.
Prior to the scheduled January and February 2007 hearing dates and after a dialogue between Mr. Shawn and Ms. Clark, the parties requested that all scheduled hearing dates be adjourned and re-scheduled to February 12, 2007. The tribunal so adjourned the hearing.
On February 12 and 15, 2007, the hearing took place and concluded. Mr. Shawn was granted thirty days from the date that the hearing transcripts were made available to submit a brief containing his closing argument and any law he deemed appropriate. Ms. Clark was granted thirty days from the date she received Mr. Shawn’s brief to submit a responsive brief.
On April 26, 2007, the tribunal received both the February 12 and 15, 2007 hearing transcripts from the reporter, making the respondent’s brief due to be submitted by May 26, 2007. The tribunal did not receive a brief from either party.
FINDINGS OF FACT
1) From at least January 18, 2001 through January 17, 2007, the respondent was certified as a general real estate appraiser (State’s Ex. 3). The tribunal takes official notice of the records of the Department of State and finds that the respondent renewed his certification as a general real estate appraiser for the period of January 18, 2007 through January 17, 2009. It is noted that the respondent is also licensed as a real estate salesperson associated with Robin M. Buckles for the period of February 23, 2007 to February 23, 2009.
Stack Appraisals
2) In an eminent domain proceeding, the Town of Walkill sought to appropriate approximately .72 acre of vacant land owned by James Stack and located on Howell Road in Middletown, New York (“the vacant property”). Initially, Mr. Stack obtained an appraisal from a State certified general real estate appraiser for the vacant property and submitted it to the court. However, the court required Mr. Stack obtain an appraisal from an appraiser who was a member of the Master Appraisal Institute (“MAI”).
3) In or prior to March 2005, Mr. Stack hired the respondent to appraise the vacant property. When he hired the respondent, he asked him if he was an MAI member because of the court’s requirement, and the respondent responded that he is or that he employs an MAI member appraiser. Mr. Stack paid the respondent $1,500 for his appraisal.
4) In fact, neither the respondent nor anyone in his employ was an MAI member appraiser. Although not asked by his attorney at the hearing, the respondent alluded to the fact that he represented to Mr. Stack that he was not a member of the MAI (Hearing transcript, pp. 128-130). I did not find the respondent’s testimony to be credible.
5) Since the court did not accept Mr. Stack’s previous appraisal report from a State certified appraiser, his sole reason for obtaining a second appraisal report was that it be by an MAI member appraiser (Hearing transcript, pp. 10-11). Therefore, I conclude that Mr. Stack hired the respondent on the respondent’s assurance that he would provide Mr. Stack with an appraisal report by an MAI member appraiser.
6) On or about March 22, 2005, the respondent submitted to Mr. Stack an unbound appraisal report for the vacant property in which he valued the property as of January 24, 2001 to be $60,000 (State’s Ex. 4). On the second page of his report, the respondent provides, “Please note this appraisal is not for court purposes, this appraisal is for preliminary use only.” The respondent testified that this report was given to Mr. Stack to give him a preliminary estimate or “ballpark figure” of what the property was worth (Hearing transcript, pp. 115, 126).
7) After submitting the unbound appraisal report, the respondent waited for Mr. Stack’s attorney to contact him about preparing a final appraisal report for submission to the court. However, in the interim, and apparently due to Mr. Stack complaining to the Department of State about the respondent’s appraisal, Department of State Senior License Investigator William Nolan (“Inv. Nolan”) visited the respondent and, according to the respondent, told him that Mr. Stack had paid for an appraisal and that respondent should give him a final appraisal in order to “be done with him.”
8) Approximately two weeks after either submitting the unbound appraisal report or meeting with Inv. Nolan, the respondent sent Mr. Stack a bound appraisal report, dated the same day as his previous appraisal report, in which he valued the vacant property as of the same date (January 24, 2001), but with an estimated market value of $65,000, $5,000 more than the previous appraisal (State’s Ex. 5). This appraisal is similar to and contains the same comparables as the previous one. The respondent did not offer any explanation for the difference in value between the unbound and bound appraisals, only that “it’s not a big difference,” “it’s basically the same thing,” and after finishing the final report and looking up more information, “I felt more comfortable with the extra five thousand dollars.” (Hearing transcript, p. 127).
Middletown Appraisal
9) Prior to August 2004, the City of Middletown, New York (“the City”) began foreclosure proceedings on the property consisting of 136 approved condominium parcels off Ruth Court, Middletown, collectively known as Eastview Condominiums (“the Eastview property”) for non-payment of real estate taxes. Before it took title to the property, the City was approached by Emperor Development Co., LLC (“Emperor Development”), which was interested in purchasing the property. The City, in turn, hired the respondent to prepare an appraisal for the Eastview property to establish the selling price to Emperor Development. The respondent understood that the City was going to use his appraisal to establish the selling price (Hearing transcript, p. 206).
10) The respondent testified that Richard Smith, representative broker of R.J. Smith Realty, was the first person to contact his office about the City hiring him to do the appraisal. Concerned about who was actually hiring him and who is client was, the respondent contacted and confirmed with the City directly that it was hiring and paying him to do the appraisal, not the broker (Hearing transcript, pp. 174, 202-203).
11) However, the respondent stated that Richard Smith told him that the City did not want a “full-blown appraisal” and that is why he prepared a restricted use appraisal report (Hearing transcript, p. 182). Yet, the respondent did not contact the City directly to determine what type of report it wanted him to prepare, discuss under what situations a restricted use appraisal report was to be used, or ensure that the City understood the restricted utility of such a report.2
12) The Eastview property consisted of the remaining undeveloped 136 sites of a fully approved 200 unit condominium project. Only Phase I of the project, 64 units in four buildings of 16 each, had been completed.
13) On or about August 6, 2004, the respondent prepared an appraisal report valuing the Eastview property as of June 30, 2004 at $503,000 (State’s Ex. 9). The City of Middletown paid the respondent $1,500 for the appraisal.
14) The respondent used only two comparables in his appraisal report, the same and only two comparables found in his workfile and which had been provided to him by real estate brokerage R.J. Smith Realty (State’s Ex. 8). Although the valuation date for respondent’s appraisal was June 30, 2004, the sale dates of the two comparables used were October 30, 2000 (almost four years earlier) and January 1998 (over six years earlier) (State’s Ex. 9).
15) The respondent testified that he was looking for and obtained comparables of abandoned subdivisions, i.e., subdivisions requiring new approvals. However, his appraisal report to the City represented otherwise, “The purpose of the appraisal is to estimate the market value of the remaining approved sites which is 136 sites.” (State’s Ex. 9).
16) In December 2004, in reliance upon the respondent’s appraisal, the City sold the Eastview property to Emperor Development for $503,000.
17) Approximately four months after this sale, during which time it did not make any changes to the property, Emperor Development re-sold the property to Eagle Point Assoc., LCC for $3,400,000.
18) The City obtained an appraisal of the Eastview property from Empire State Appraisal Consultants, Inc. (“Empire Appraisal”) to provide an opinion of market value for their anticipated or pending litigation (State’s Ex. 12). On or about September 6, 2005, Empire Appraisal submitted its appraisal report appraising the Eastview property as of June 30, 2004 to be $3,125,000.
19) In or about late September 2005, the City commenced a civil action in the Orange County Supreme Court against the respondent based on the subject appraisal and alleging that he damaged the City in the amount of $2,897,000, representing the difference between the respondent’s appraised value (the City’s sale price) and Emperor Development’s sale price (State’s Ex. 10). That action is pending.
OPINION AND CONCLUSIONS OF LAW
I- As the party which initiated the hearing, the burden is on the complainant to prove, by substantial evidence, the truth of the charges set forth in the complaint. State Administrative Procedure Act §306(1). Substantial evidence “means such relevant proof as a reasonable mind may accept as adequate to support a conclusion or ultimate fact... More than seeming or imaginary, it is less than a preponderance of the evidence, overwhelming evidence or evidence beyond a reasonable doubt (citations omitted).” 300 Gramatan Avenue Associates v. State Div. of Human Rights, 45 NY2d 176, 408 NYS2d 54, 56-57 (1978); Tutuianu v. New York State, 22 AD3d 503, 802 NYS2d 465 (2nd Dept. 2005). “The question...is whether a ‘conclusion or ultimate fact may be extracted reasonably--probatively and logically’” City of Utica Board of Water Supply v New York State Health Department, 96 AD2d 719, 465 NYS2d 365, 366 (1983), quoting 300 Gramatan Avenue Associates, supra, 408 NYS2d at 57.
Stack Appraisals
II- The Preamble to the USPAP provides:
The purpose of the Uniform Standards of Professional Appraisal Practice (USPAP) is to promote and maintain a high level of public trust in appraisal practice by establishing requirements for appraisers. It is essential that appraisers develop and communicate their analyses, opinions, and conclusions to intended users of their services in a manner that is meaningful and not misleading.
The respondent’s submission of the unbound and bound appraisal reports to Mr. Stack was not meaningful and was misleading. There is no provision or distinction in the USPAP for an appraiser providing a “preliminary” appraisal report as opposed to a “final” appraisal report to a client. Furthermore, there is no apparent reason for the respondent failing to include relevant and necessary information in even a preliminary appraisal report. But for Inv. Nolan’s meeting with the respondent, the respondent may have waited indefinitely until Mr. Stack’s attorney contacted him to request that he provide a more final report.
By submitting his unbound and bound appraisal reports, the respondent violated USPAP Standards Rules 1-2(a), 1-2(b) and 1-2(c), and violated Executive Law §§160-u(1)(f) and 160-u(1)(h).
III- By representing to Mr. Stack that his office would provide him with an appraisal report by an MAI member appraiser where, in fact, there was no MAI member appraiser employed by respondent, the respondent violated Executive Law §160-d(3)(f) and the USPAP Competency Rule, and thereby violated Executive Law §160-u(1)(f) and demonstrated negligence and incompetence in developing an appraisal, in preparing an appraisal report, and in communicating an appraisal in violation of Executive Law §160-u(h).
IV- The respondent’s unbound appraisal report contained the following errors:
a. The appraiser did not prominently state under which of the three type appraisal reports he prepared, a 1) self-contained, 2) summary or 3) restricted use appraisal report (USPAP Standards Rule 2-2);
b. Assuming that the appraisal was a restricted use appraisal report, the respondent: 1) failed to state the real property interest appraised (fee simple, leasehold, etc.) (USPAP Standards Rule 2-2(c)(iv)); 2) failed to give an opinion of the highest and best use of the property (USPAP Standards Rule 2-2(c)(ix)); and 3) failed to include a signed certification in accordance with Standards Rule 2-3 in violation of Standards Rule 2-2(c)(xi);
c. The respondent made no comment on the prior ownership of property, i.e., failed to analyze all sales of the subject property that occurred within the three years prior to the effective date of the appraisal (SAPA §1-5(b)). At the hearing, the respondent testified that the property did not sell in the three years prior to valuation. This fact should have been but was not mentioned in the appraisal report; and
d. All five comparable sales used by the respondent were after the date of valuation (USPAP Standards Rule 1-1(b) and 1-1(c)). While the tribunal does not find that the use of comparables after the date of valuation is per se a violation of USPAP Standards (See, for discussion, Statement on Appraisal Standards No. 3 (SMT-3)), the respondent’s use of the comparables in this case was unreasonable. Not some but all of the comparables used in respondent’s appraisal were after the date of valuation. Only one of those comparables was sold within a few months of the valuation date (comparable #4). Three of the five comparables (comparables ##1-3), which were adjacent lots that all sold on the same day, were sold one year and three months after the date of valuation. Respondent’s comparable #5 sold almost two years after the date of valuation.
The respondent’s bound appraisal report contained the same error as described in subsection “d.” above.
By virtue of the above USPAP violations, the respondent violated Executive Law §§160-d(2)(b)(1), 160-d(2)(b)(5), 160-d(3)(a)(3), 160-u(f), and demonstrated negligence and incompetence in developing an appraisal, in preparing an appraisal report, and in communicating an appraisal in violation of Executive Law §160-u(h).
Middletown Appraisal
V- The respondent’s appraisal of the Eastview property contained a number of USPAP violations, namely:
a. The respondent did not prominently state under which of the three type appraisal reports he prepared, a 1) self-contained, 2) summary or 3) restricted use appraisal report (USPAP Standards Rule 2-2). Only at the hearing did the respondent make it clear that he prepared a restricted use appraisal report (Hearing transcript, p. 182);
b. The respondent failed to state the identity of the client, by name or type (USPAP Standards Rule 2-2(c)(i));
c. The respondent failed to state a prominent use restriction that limits use of the report to the client and warns that the appraiser’s opinions and conclusions set forth in the report may not be understood properly without additional information in the appraiser’s workfile (USPAP Standards Rule 2-2(c)(i));
d. The respondent failed to state the real property interest appraised (fee simple, leasehold, etc.) (USPAP Standards Rule 2-2(c)(iv));
e. Although he did consider the highest and best use of the property (Hearing transcript, p. 192), the respondent failed to give an opinion of the highest and best use of the property (USPAP Standards Rule 2-2(c)(ix));
f. The respondent failed to include a signed certification in accordance with Standards Rule 2-3 in violation of USPAP Standards Rule 2-2(c)(xi);
g. The respondent failed to analyze all agreements of sale, options, and listings of the subject property current as of the effective date of the appraisal (USPAP Standards Rule 1-5(a)). The respondent failed to mention the status of the City’s sale of the Eastview property or whether or not it had listed it for sale;
h. The respondent failed to analyze all sales of the subject property that occurred within the three years prior to the effective date of the appraisal in violation of USPAP Standards Rule 1-5(b). Although the Eastview property had not been sold within the past three years, the respondent failed to even mention the past length of ownership of the property;
i. The respondent used only two comparable sales for the property, one of which was dated almost four years prior to the valuation date of the property, the other dated over six years prior thereto. The respondent’s use of only two comparables (not a violation per se) and the fact that those two comparables were so remote in time from the valuation date, when taken together, appeared to be unreasonable (USPAP Standards Rule 1-1(b) and 1-1(c)). The respondent testified that he conducted his own independent research and viewed at least one other comparable property (Hearing transcript, pp. 205-206), but there is no evidence in his workfile that he actually reviewed or considered properties other than the two provided to him by R.J. Smith Realty. Even the respondent’s own expert admitted that respondent’s 1998 comparable was “getting whiskers” (Hearing transcript, p. 163); and
j. By virtue of the violations above and as discussed below, in developing, preparing and submitting the appraisal of the Eastview property, the respondent: 1) committed a substantial error of omission or commission that significantly affected the appraisal (USPAP Standards Rule 1-1(b)); 2) rendered appraisal services in a careless or negligent manner (USPAP Standards Rule 1-1(c)); set forth a misleading appraisal (USPAP Standards Rule 2-1(a)); failed to include sufficient information to enable the intended user of the appraisal to understand the report properly (USPAP Standards Rule 2-1(b)); and failed to clearly and accurately disclose all assumptions, extraordinary assumptions, hypothetical conditions, and limiting conditions used in the assignment (USPAP Standards Rule 2-1(c)).
VI- The respondent prepared a misleading appraisal report on the Eastview property by representing that he was estimating the market value of a fully approved subdivision while using unapproved subdivisions as his comparable properties. This led the City to believe that its Eastview property, with all its “bundle of rights” (i.e., a fully approved subdivision), was worth only $503,000. In fact, the property, as a fully approved subdivision, was worth considerably more (See, State’s Ex. 10 (Exhibit D) and 12). The respondent’s appraisal report neither represented nor clued the City to the widely divergent market value between the subdivision as approved versus unapproved.
At the hearing, the respondent claimed that his appraisal report reflected the Eastview property’s value as an “approved” subdivision that needed to go through the approval process again (Hearing transcript, p. 213). While the respondent may have clarified his appraisal report at the hearing, his testimony did not rectify his report nor did it alleviate the severity of his misrepresentation to the City (Hearing transcript, pp. 213-214). The respondent’s report definitively stated, “The purpose of the appraisal is to estimate the market value of the remaining approved sites which is 136 sites.” (State’s Ex. 9). There was no reference in his report that the approvals were no longer in effect or that new approvals would have to be obtained.
Further, I did not find the respondent to be credible, particularly in his testimony concerning his research regarding the approvals. The respondent was well aware that the existence of approvals or lack thereof on the Eastview property would substantially affect its value. On direct examination and initially on cross, the respondent gave the tribunal the distinct impression that the respondent himself contacted the building department to confirm whether or not the approvals were still valid (Hearing transcript, pp. 177, 208-210). The respondent subsequently stated that one of his secretaries, who was not produced at the hearing, confirmed that information with the building department (Hearing transcript, p. 210-211). The respondent also stated that there was a note in his workfile confirming the secretary’s conversation with the building department, but there was no such note in his workfile (Hearing transcript, pp. 209-210; State’s Ex. 8). Finally, the respondent did not know on what day the conversation took place or who his secretary spoke with at the building department. The respondent’s testimony was simply not believable.
Another issue raised by respondent, particularly through real estate broker Richard J. Smith’s testimony, was that when the City was selling the property, it, by choice, was selling the property as is, unconditionally, without taking the approval issue into consideration. In the subsequent transaction by Emperor Development Inc., the sale was contingent on the buyer receiving approvals for the property.
Respondent’s argument does not have merit. Not only did the respondent’s appraisal misrepresent the status of the property being appraised, it gave the City nothing to compare it to (i.e., approved value versus unapproved value). In other words, respondent’s appraisal completely obscured the property’s potential value to the City.
The respondent’s failure to state the highest and best use of the Eastview property in his appraisal report was particularly egregious because it prevented the City from possibly realizing the respondent’s misrepresentation of the property. In other words, had the respondent indicated the highest and best use of the property as (or to the effect of) a residential development “in need of approvals” or “lacking in approvals,” the City would have been alerted to either the inconsistency in respondent’s report or that he was appraising the property as a defunct development.
Even the respondent’s own expert witness recognized the problems and conflicts between the respondent’s appraisal and appraisal report, which ultimately misled the client:
A. ...when appraisers appraise, they don’t appraise dirt, they’re really appraising the bundle of rights on the highest and best use, to which that bundle can be put.
Q. Okay. Would you agree with me that when Mr. Buckles prepared his report, that he believed that he was appraising the property with that bundles of rights, that he was appraising property that had the necessary approvals?
A. No, ...I believe...that he did not think that...and that that was the reason he selected properties – or ostensibly that must have been the reason he selected properties that were defunct condominium developments. (Hearing transcript, pp. 147-148).
********************
Q. I’m going to direct your attention to the second paragraph. The – starting with subject property, ask you to read the second sentence of that paragraph,
A. “The subject property is approved for two hundred condominiums, however phase one was completed, but the majority of the property has remained unfinished.”
Q. And the next sentence.
A. “The purpose of the appraisal is to estimate the fair-market value of the remaining approved sites.”
Q. “The remaining approved sites.”
A. Yeah.
Q. Which is a hundred to a hundred and thirty – thirty-six sites. Thank you.
A. This contradicts –
Q. Actually –.
A. – something he said.
Q. So, he – he must have said that to you, perhaps.
A. No, it was in writing. He didn’t say it to me.
Q. Okay. So, that does contradict –?
A. Yeah, this is contradicting –. (Hearing transcript, pp. 149-150).
********************
Q. Yes. What I’m getting at is even though his letter says that the purpose of the appraisal is to estimate the market value of the remaining approved sites, if in fact, the sites were not approved, they’re not going to become approved because he says in here that that’s what he’s doing.
A. No, they’re not going to become approved because he says within there that’s why he’s doing it. But he’s got–he’s got– he’s describing conflicting purposes. He’s describing one thing there, a hundred and thirty-six approved sites, and then he’s selecting comparables, where there ain’t no approvals.
Q. Which leads you to believe what?
A. That his comparables weren’t comparable.
Q. That the comparables were not comparables, or that he may have misspoke when he said these were approved sites.
A. Oh, if he misspoke, that’s another thing. (Hearing transcript, pp. 155-156).
********************
A. Well, it’s pretty obvious. If – if approvals were in place, then these were not – were a – poor comparables. If the approvals were not in place, then these could have been legitimate – could have been legitimate comparables. Though I, too, would agree that a comparable in 1998, or whatever, was getting a little – getting whiskers.
Q. Okay. But –
A. Getting a little old. (Hearing transcript, p. 163).
By preparing and communicating an inaccurate and misleading appraisal, the respondent violated Executive Law §§160-d(2)(a), 160-d(2)(b)(5, 7, 8), 160-d(3)(a)(2, 3, 6), 160-d(3)(c)(3), 160-u(1)(f), and 160-u(1)(h), and through 19 NYCRR 1106.1, violated USPAP Standards Rules 1-1(b), 1-1(c), 1-5(a), 1-5(b), 2-1(a), 2-1(b), 2-1(c), 2-2, 2-2(c)(i), 2-2(c)(iv), 2-2(c)(ix), and 2-2(c)(xi).
VII- The law regarding restitution and real estate brokers is well defined. The Department of State is “accorded broad discretion in imposing penalties designed to safeguard the public interest and discourage real estate brokers from engaging in shadowy practices (citations omitted),” and, “One can hardly fathom a more effective means of removing the incentive for engaging in devious conduct...than a penalty which insures that the malefactor is denied the fruits of his misdeed.” Kostika v. Cuomo, 41 NY2d 673, 394 NYS2d 863, 865 (1977). This application of the law may be applied equally to real estate appraisers3.
While he may not have engaged in conduct that can be described as devious, the respondent should not benefit by retaining his appraisal fee where he provided clients with appraisal reports that contained numerous violations of the USPAP and Executive Law, and which did not in any way benefit the recipients. On the other hand, the tribunal clearly is not permitted to evaluate or impose civil damages against the respondent.
DETERMINATION
WHEREFORE, IT IS HEREBY DETERMINED THAT Robert G. Buckles, Jr. has violated the sections of Executive Law §§160-d and the USPAP Rules discussed above, has violated the standards for the development and communication of real estate appraisals pursuant to Executive Law §160-u(1)(f), and has demonstrated negligence and incompetence in developing, preparing, and communicating appraisals in violation of Executive Law §160-u(1)(h). Accordingly, pursuant to Executive Law §160-u, his certification as a general real estate appraiser is suspended commencing on January 1, 2008 and terminating one year after the receipt, by certified mail, by the Department of State of his certification.
WHEREFORE, IT IS FURTHER DETERMINED THAT upon termination of the suspension, respondent’s certification shall be further suspended until he shall have produced proof satisfactory to the Department of State that he has refunded the sum of $1,500, together with interest at the legal rate for judgments (currently 9% per year) from January 1, 2008, to the City of Middletown, New York, and that he has refunded the sum of $1,500, together with interest at the legal rate for judgments (currently 9% per year) from January 1, 2008, to James Stack.
The respondent is directed to send his certification and proof of payment of the ordered restitution, each by certified mail, to Kathy Scarcella, Customer Service Unit, Department of State, Division of Licensing Services, Alfred E. Smith Building, 80 South Swan Street, 10th Floor, Albany, NY 12201.
Scott NeJame
Administrative Law Judge
Dated: November 29, 2007
1Many of the USPAP provisions are repeated in Executive Law §§160-d(2) and 160-d(3).
2The Comment to USPAP Standards Rule 2-2(c)(i) regarding restricted use appraisal reports provides, “Before entering into an agreement, the appraiser should establish with the client the situations where this type of report is to be used and should ensure that the client understands the restricted utility of the Restricted Use Appraisal Report.”
3Real Property Law §441-c, the statutory equivalent of Executive Law §160-u, which authorizes the Department of State to revoke or suspend the license of or otherwise discipline a real estate broker or salesperson, does not specifically provide for the Department of State to order restitution.