1) The respondent is duly licensed as a real estate salesperson with a term expiration of June 20, 2009. He is not currently associated with a licensed real estate brokerage. From February 1, 2005 to March 22, 2006, the respondent was a licensed salesperson duly associated with Urban Sanctuary Realty, LLC (State’s Ex. 3).

            2) In August of 2006, Mr. Maximilian Cukier and several friends obtained the services of the respondent to locate a residential rental property. Mr. Cukier testified that the respondent represented himself as a salesperson associated with Urban Sanctuary Realty, LLC. The respondent showed several apartments to Mr. Cukier and his intended roommates including Unit 5 at 183 Broadway (hereinafter “Broadway apartment”).

            3) On September 5, 2006, Mr. Cukier and his roommates presented the respondent with a bank check for $5,130.00 payable to “Eric Poto” which represented, in part, the respondent’s commission (State’s Ex. 5). The check was signed by Mr. Adam Yeremian, one of the roommates.

            4) Mr. Cukier and his roommates took possession of the Broadway apartment after assurances from the respondent and the landlord that an additional room could be added, allowing each roommate to have his own room. After he was later notified that the space could not be converted, Mr. Cukier left the property and commenced an action to recover commission fees from the respondent and others.

            5) By order dated May 14, 2007, the Small Claims Part of the Civil Court of the City of New York ordered the respondent to pay Mr. Cukier $997.00,with interest as of January 1, 2007 (State’s Ex. 5). The respondent has failed to satisfy the judgement.

            6) DLS District Manager Jack Bilello contacted the respondent and advised him of the complaint. The respondent gave Mr. Bilello a new residential address for correspondence.

            7) DLS Investigator Monet Daniels-Adams called the respondent and mailed several interview request letters by regular and certified mail to both the new address given to Mr. Bilello and the address in the records of the Department of State. The respondent did not return the investigator’s calls, reply to the correspondence, or appear for a scheduled interview.

                                    OPINION AND CONCLUSIONS OF LAW

            I- The holding of an ex parte quasi-judicial administrative hearing was permissible, inasmuch as there is evidence that notice of the place, time and purpose of the hearing was properly served. Patterson v. Department of State, 36 AD2d 616, 312 NYS2d 300 (3^rd Dept. 1970); Roy Staley v. Division of Licensing Services, 14 DOS App 01; Matter of the Application of Rose Ann Weis, 118 DOS 93; see also, Verdell v. DeBuono, 262 AD2d 812, 691 NYS2d 679 (3^rd Dept. 1999); Jacoby v. New York State Board for Professional Medical Conduct, 295 AD2d 655, 743 NYS2d 192 (3^rd Dept. 2002).

            II- 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 (2^nd 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.

            III- A real estate salesperson may receive and/or demand compensation only from the duly licensed real estate broker with whom he is associated (Real Property Law §442-a). The complaint indicates, “The check representing the real estate commission was subsequently cancelled.” Although the form and context of that statement would tend to convey that someone voided or stopped payment on the check, the complainant intended to indicate the check had been processed by the bank. By receiving compensation directly from Mr. Cukier and his roommates, the respondent violated that statute and demonstrated untrustworthiness and incompetence.

            IV- A real estate salesperson may lawfully engage in real estate brokerage transactions only when associated with a licensed real estate broker ( Real Property Law §440[3]). The respondent violated that statute by, among other acts, showing apartments and accepting a commission as payment for the duties he performed.

            V- Real estate salespersons and brokers have a fundamental duty to deal honestly with the public. Division of Licensing Services v. John Linfoot, 60 DOS 88, conf'd. sub nom Harvey v Shaffer, 156 AD2d 103, 549 NYS2d 296 (1989). The evidence establishes that the respondent told Mr. Cukier he was associated with Urban Sanctuary Realty at a time when he was not associated with any licensed brokerage. By falsely representing himself in this manner, he failed to deal honestly and fairly with the public, and this failure was a demonstration of untrustworthiness and incompetency.

            VI- The respondent failed to pay the $997.00 judgement ordered by the Small Claims Court. "The failure to pay a judgement which has been lawfully obtained, without a showing that he is unable to do so, is a demonstration of untrustworthiness by a real estate broker. Department of State v. Feldman, 113 DOS 80, conf'd. sub nom Feldman v. Department of State, 81 AD2d 553, 440 NYS2d 541 (1981); Division of Licensing Services v. Shulkin, 40 DOS 90; Division of Licensing Services v. Janus, 33 DOS 89." Division of Licensing Services v. Harrington, 123 DOS 93, at p. 4. By failing to satisfy the Small Claims Court judgment awarded to Mr. Cukier, the respondent demonstrated untrustworthiness.

            VII- Real Property Law §442-e[5] states:

"The secretary of state shall have the power to enforce the provisions of this article and upon complaint of any person, or on his own initiative, to investigate any violation thereof or to investigate the business, business practices and business methods of any person, firm or corporation applying for or holding a license as a real estate broker or salesman, if in the opinion of the secretary of state such investigation is warranted. Each such applicant or licensee shall be obliged, on request of the secretary of state, to supply such information as may be required concerning his or its business, business practices or business methods, or proposed business practices or methods."

            Pursuant to Real Property Law §442-j, the Secretary of State has the authority to delegate to employees of the Department of State the above powers to compel a licensee to supply information. The respondent repeatedly ignored Department of State’s calls and correspondence that indicated his cooperation was necessary for an investigation. In so doing he failed to meet his obligation to cooperate with the investigation and further demonstrated untrustworthiness.

DETERMINATION

            WHEREFORE, IT IS HEREBY DETERMINED THAT respondent Eric Poto, UID# 40PO1053099, has violated Real Property Law §440-a, failed to deal honestly and fairly with the public, and demonstrated untrustworthiness and incompetence in violation of Real Property Law §441-c. Accordingly, pursuant to Real Property Law §441-c, the real estate salesperson license issued to Eric Poto is revoked, effective immediately. Should he ever re-apply for a license as a real estate broker or salesperson, or any license issued by the Department of State, no action shall be taken on such application until he shall have produced proof satisfactory to the Department of State that he has satisfied the May 14, 2007 Small Claims Court judgment obtained by Mr. Eric Poto in the amount of $997.00, with interest as of January 1, 2007. The respondent is directed to send his license certificate and pocket card, by certified mail, to Norma Rosario, Customer Service Unit, Department of State, Division of Licensing Services, Alfred E. Smith Building, 80 South Swan Street, 10th Floor, Albany, NY 12201.

                                                                                    Ziedah F. Giovanni

                                                                              Administrative Law Judge

Dated: April 30, 2009