Edmonds

John J. Augustyn appeals a judgment in this proration class action lawsuit (Bus. & Prof. Code, § 10474.5) distributing the $100,000 Burton Recovery Account fund from the Recovery Account of the Real Estate fund to certain investors in a statewide second trust deed Ponzi scheme perpetrated by real estate broker Wayne Burton and his “investment counselors.” The Recovery Account is a continuing appropriation for carrying out the Real Estate Recovery Program. (§§ 10450, 10450.6.) Generally, the Real Estate Recovery Program (§ 10470 et seq.) permits persons who have obtained final judgment against a real estate licensee for fraud, misrepresentation, deceit or conversion of trust funds arising directly out of a transaction in which the licensee performed acts for which the license was required, to apply to the Department of Real Estate for payment from the Recovery Account of the amount unpaid on the judgment up to certain limits. (§ 10471.) In 1987, the Legislature declared the Real Estate Recovery Program insolvent. (Stats. 1987, ch. 535, § 1, subd. (c).)

Augustyn contends that under the statutory scheme, and particularly sections 10471, subdivision (a), 10474, and 10474.5,…