STATE OF NEW YORK
DEPARTMENT OF STATE
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GEORGE LAMBRO,
Appellant,
DECISION
15 DOS APP 07
against
DEPARTMENT OF STATE
DIVISION OF LICENSING SERVICES,
Respondent.
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Appellant George Lambro, a licensed real estate broker associated with Weichert Realtors Lambro & Associates 58 Commack Road, Commack, New York 11725, appeals a decision of Administrative Law Judge (ALJ) Roger Schneier (861 DOS 05), rendered December 13, 2005, which revoked his license as a real estate broker effective January 15, 2006, based on a finding that he breached his fiduciary duty to his principal by entering into a listing agreement without fully advising his principal as to its terms, failing to release his principal from the listing when requested to do so, wrongfully indicating to the multiple listing service that his principal's home had been taken off the market; and without authority placing the property back on the multiple listing service after the listing had been cancelled. All of these actions demonstrated untrustworthiness.
On this appeal, Appellant claims he was never notified or made aware of the case against him. Appellant did not appear at the administrative hearing held December 13, 2005 and did not testify or present evidence.
Respondent Division of Licensing Services objects to this appeal on the grounds that (1) the appeal is untimely, (2) Appellant was properly served with the Complaint and Notice of the Hearing and therefore was not denied due process of law and (3) the ALJ’s decision is supported by substantial evidence in the record.
FINDINGS OF FACT
1. The ALJ found that
“ 1) Notice of hearing together with a copy of the complaint was served by certified mail addressed to the respondent (Appellant here) at his last known place of business and posted on August 30, 2005. That mail was returned by the Postal Service marked "not deliverable as addressed, unable to forward" and "moved left no fwd" (State's Ex. 1).”
The record on appeal and transcript of the hearing (Tr p. 4) indicate that on September 7, 2005, Respondent made a second attempt to serve the Complaint and Notice of Hearing on Appellant by first class mail. An Affidavit of Service of both mailings was entered into evidence as State’s Exhibit 1 and indicates that the mailings were addressed to:
George Lambro
Weichert Realtors Lambro & Associates
58 Commack Road
Commack, NY 11725
2. The ALJ’s decision was issued on December 13, 2005 and mailed by certified mail to Appellant the same day to the above address. In addition, the decision was sent by certified mail to his home address at 39 Clayton Drive, Dix Hills, NY 11725. Proof of mailing indicates it was eventually returned to the Department of State by the US Postal Service on marked “Unclaimed, return to sender.” On the returned envelope sent by certified mail to Appellant’s business address, the US Postal Office appended a notation with a forwarding address:
“Notify Sender of New Address
Lambro
PO Box 213115
RYL Palm Beach, Fl 33421-3115"
3. Nothing in the record on appeal indicates that once Appellant’s actual address was ascertained, the Office of Administrative Hearings sent a copy of the decision to the forwarding address.
OPINION
I. Service of the Complaint and Notice of Hearing
In Mullane v. Central Hanover Bank & Trust Co.,339 U.S. 306, 314 (1950), the United States Supreme Court stated that "[a]n elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections." The holding of an ex parte quasi-judicial administrative hearing is permissible when 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 (1970).
Real Property Law 441-e (2) provides that when the Secretary of State seeks the revocation or suspension of a real estate broker’s license, the Secretary must give the broker reasonable notice of the hearing “by certified mail to the last known business address of such licensee or unlicensed person, or by any method authorized by the civil practice law and rules.”
Respondent Division of Licensing Services served the Complaint and Notice of the hearing on Appellant by certified mail at his last known place of business on August 30, 2005. The US Postal Service returned that mailing marked "not deliverable as addressed, unable to forward" and "moved left no fwd". On September 7, 2005, Respondent made a second attempt to serve the Complaint and Notice of Hearing on Appellant by first class mail at the same address.
Respondent fulfilled its obligation to serve the Complaint and hearing notice on Appellant consistent with applicable law. Appellant’s failure to receive these documents does not render inadequate Respondent's efforts to provide reasonable notice under due process precepts. In re Bouchard, 29 A.D.3d 79 (3rd Dept.2006). Respondent complied with the statutory notice requirement. As notice by certified mail to the address on file with the Department is reasonably calculated to reach the licensed real estate broker, the Respondent was not required to go further. Nonetheless, Respondent did take the additional reasonable step of sending a second copy of the complaint and hearing notice to Appellant by first class mail. There is nothing in Appellant’s papers, or the record before the Secretary, suggesting that the Respondent had any reason to believe that the notices were sent to an incorrect address or otherwise were not reasonably calculated under the circumstances to apprise Appellant of the complaint and afford him an opportunity to be heard before the administrative tribunal. Under the circumstances of this case, Respondent's attempts to serve Appellant satisfied due process.
A real estate broker is independently obligated to promptly notify the Department of any change in his principal business address. Real Property Law (RPL) § 441-a (5) provides:
Change of address. Notice in writing in the manner and form prescribed by the Department shall be given the Department at its offices in Albany by a licensed real estate broker on his own behalf and on behalf of each salesman associated with him of any change in his or its principal business address.... Such change by a licensee without such notification shall operate to suspend his license until such suspension shall be vacated by the Department.
The broker’s obligation to file a change of business address serves the twin functions of notifying the Department where to send renewal applications and where to serve complaints and complaints and notices in disciplinary actions. Without a change of address, the Department may not properly locate the licensed broker or salesperson.
In his letter on appeal, Appellant indicated he changed his business address some five months earlier, however, he never officially notified the Department of his change of address. As a licensed real estate broker, Appellant bore the responsibility of updating his address or, at least, arranging for his mail to be forwarded to his out of town address. In this regard, Appellant failed to follow his statutory obligation. The Respondent’s attempts to serve him logically could not have succeeded without notification of a forwarding business mailing address. It was not required to do more.
Notwithstanding the decision in this matter, Appellant’s license was automatically suspended by operation of law when he moved and failed to notify the Respondent of his new address. RPL § 441-a (5)
2. Service of the Decision by the Office of Administrative Hearings
A party’s obligation to appeal the ALJ’s decision to the Secretary of State begins to run “within 30 calendar days of receipt”of the decision. (19 NYCRR 400.2 (k)). In this case, Appellant was never properly served with the ALJ’s decision. The time period to appeal has therefore not yet begun to run. This conclusion is supported both by statute and constitutional principles.
Real Property Law § 441-c (2), which deals with revocation and suspension of licenses, states:
In the event that the Department shall revoke or suspend any such license, or impose any fine or reprimand on the holder thereof, its determination shall be in writing and officially signed. The original of such determination, when so signed, shall be filed in the office of the Department and copies thereof shall be served personally or by registered mail upon the broker or salesman and addressed to the principal place of business of such broker or salesman, and to the complainant....
Real Property Law § 441-c (2) expressly limits the methods for service of the decision to either personal service or registered mail. No other method of service is appropriate. Where the State Legislature has specified the method of service, it is to ensure that actual notice of the decision is received by the licensee. Service must be accomplished in strict compliance with terms of the statute.
In this case, the decision was served by certified mail, and not by personal service or registered mail, as required by Real Property Law § 441-c (2). Service of the decision on Appellant was therefore legally defective.
When the US Postal Service returned the envelope containing the decision with Appellant’s forwarding address printed on the front, OAH became obligated to again serve him, in accordance with statute, at that address. In light of the notice's return with the forwarding address, OAH was required to use "reasonably diligent efforts" to serve Appellant at his last known address by statutorily proper means. Kennedy v. Mossafa, 100 N.Y.2d 1, 9 (2003); Mullane v. Central Hanover Bank & Trust Co., 339 U.S. at 317 (due process requires "due diligence" in ascertaining whereabouts of a party); Cadle Co. v. Tri-Angle Associates, 18 A.D.3d 100 (1st Dept. 2005)( “Due diligence is an issue only with regard to whether the ‘last known address’ could be ascertained...”) and Akey v. Clinton County, N.Y., 375 F.3d 231(2nd Cir.2004). “Where the names and addresses of interested parties are known, due process requires notice reasonably calculated, under all the circumstances, to apprise that party of the [subject] action, so that the party may have an opportunity to appear and be heard” Kennedy v. Mossafa, 100 N.Y.2d at 9. Because no further attempt was made to serve Appellant after his forwarding address became known, the Appellant was not properly notified of the decision and did not have an opportunity to appeal to the Secretary. Therefore, the 30 day period to appeal did not begin to run and Appellant’s appeal is not time-barred.
The conclusion that service of the decision was defective only affects Appellant’s time to appeal and in no manner effects the validity of, or the holding reached in, the decision below.
3. Status of Appellant’s Real Estate Brokers License
Appellant’s real estate brokers license expired on March 12, 2007. If Appellant prevails on appeal and has his license reinstated, he will not be entitled to practice as a real estate broker without renewing his license. On the other hand, reinstatement would allow him to apply for relicensure without waiting a year (RPL § 441-c (4)) and may expunge the taint on his record. Upon proper service of the decision, Appellant Lambro has the option of pursuing an appeal.
DETERMINATION
The Office of Administrative Hearings is directed to serve the decision (861 DOS 05) on Appellant at his current address, 1196 Canyon Way, Wellington, Florida 33414, in a manner authorized by RPL § 441-c (2). Such decision shall be final and binding unless Appellant Lambro (or Respondent) appeals the decision to the Secretary of State within 30 calendar days of receipt. Such an appeal must include a “written memorandum stating the appellant's arguments and setting forth specifically the questions of procedure, fact, law or policy to which exceptions are taken, identifying that part of the administrative law judge's decision and order to which objection is made, specifically designating the portions of the record relied upon, and stating the grounds for exceptions.” 19 NYCRR 400.2 (k).
So ordered on April 16, 2007.
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Matthew L. Andrus
First Deputy Secretary of State