Armenta

Mary A. Armenta appeals from an order denying her application for payment out of the real estate recovery account. (Bus. & Prof. Code, § 10470 et seq.)

The facts were stipulated below and we are asked to resolve a question of law. Armenta recovered a default judgment against a licensed real estate agent based upon allegations of fraud. The agent filed bankruptcy and Armenta requested the bankruptcy court to determine the dischargeability of the debt on the basis of the alleged fraud of the agent. During the pendency of her action in the bankruptcy court, she filed the instant application. The bankruptcy court ruled in favor of the agent and discharged the debt. The trial court relied upon the discharge by the bankruptcy court and denied her application.

Armenta contends on appeal that an application for payment out of the real estate recovery account can be predicated upon a debt which has been discharged in bankruptcy. We disagree because of the express language of three interrelated statutes.

“When an aggrieved person obtains a final judgment” against a real estate licensee, he may file an application for payment from the real estate recovery account if certain other…