Grubb Co. v. Department of Real Estate

I.

INTRODUCTION

An employee of appellant The Grubb Company, Inc. (Grubb), a licensed real estate brokerage firm, represented both parties in negotiations for the sale of a residence. The sale fell through, and the sellers, against Grubb’s advice, declined to return the buyers’ deposit. The buyers sued Grubb, several of its employees, and the sellers. The jury found that Grubb and one of its employees had made misrepresentations and breached their fiduciary duty. The jury also found, however, that the buyers had not shown by clear and convincing evidence that Grubb or its employee acted with malice, fraud, or oppression.

*1497 The California Real Estate Commissioner (Commissioner) initiated administrative disciplinary proceedings against Grubb under a statute, Business and Professions Code section 10177.5, 1 authorizing discipline based upon a civil judgment against a real estate licensee for misrepresentation, fraud, or deceit in connection with a transaction for which a license is required. After a hearing, an administrative law judge recommended that no discipline be imposed, but the Commissioner rejected the recommendation and imposed discipline. The trial court…