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Miller v. Kentucky State Real Estate Commission

October 10, 1952

MILLER
v.
KENTUCKY STATE REAL ESTATE COMMISSION ET AL.



Moremen

MOREMEN, Justice. This appeal is from a judgment of the Kenton Circuit Court which sustained appellee's demurrer to appellant's petition and whereby, upon appellant's declension to plead further, the petition was dismissed.

The facts of the case as gleaned from the allegations of the petition and exhibits are substantially as follows: 'Appellant, Jeanette Miller, who was engaged in the real estate business, applied to the Kentucky State Real Estate Commission, upon a form of application furnished by it, for a broker's license to engage in the real estate business. This form required that two real estate owners certify the applicant 'bears a good reputation for honesty, competency, and fair dealing, and recommend that a license be granted to said applicant.' At the bottom of the certificate it was necessary that the persons who recommended the applicant sign their names and give their respective addresses. On the application appellant submitted to the Commission two signatures appeared which purported to be those of two property owners who were sponsoring her. A license was issued to appellant. Thereafter, and on March 29, 1952, the Commission issued a notice to appellant which stated they had received knowledge of facts that indicated she had obtained a license through fraudulent representations in violation of subsection (a) of KRS 324.160; that neither of the endorsers who appeared to have signed her application had, in fact, done so but, to the contrary, someone else had signed their names without their permission and knowledge. It was pointed out that if these facts were proved beyond a reasonable doubt it would appear that she was guilty of violating subsections (a) and (k) of Section 324.160. KRS 324.160 reads in part:

'The commission may suspend or revoke any license for any of the following causes:

'(a) Obtaining a license through false or fraudulent representation.

'(k) Any other conduct that constitutes improper, fraudulent or dishonest dealing.'

Appellant was also notified of a hearing at which time she would be called upon to show cause, if any she had, why her real estate license should not be suspended or revoked.

At a hearing before a full Commission, on April 26, 1952, the day set by the notice, an order was entered which reads in part:

'The Defendant, Mrs. Jeanette Martha Miller, appearing in person and by counsel and the Defendant entering a plea of guilty to violation of subsection a and k of Section 324.160 Kentucky Revised Statutes, and the commission being fully advised it is hereby ordered, adjudged and decreed that the Real Estate License rights of the aforesaid Jeanette Martha Miller are hereby suspended for a period of six (6) months commencing May 1, 1952 and ending October 31, 1952.'

On June 24, 1952, appellant filed a petition in the Kenton Circuit Court in which she prayed that Chapter 324 of the Kentucky Revised Statutes be declared unconstitutional and void as being beyond the police powers of the Commonwealth of Kentucky; for a judgment setting aside and holding for naught the order entered on April 26, 1952, and for a further order and judgment requiring the defendant to issue a license to her.

Appellant urges as grounds for reversal that: (a) the notice given by the Commission to appellant of the hearing was insufficient; (b) the Commission does not have the police or regulatory power to suspend a license on the ground that applicant or licensee does not meet the moral requirements set up by the Commission; (c) the act, Chapter 324 of KRS, insofar as it attempts to create a Commission with judicial powers is in violation of Section 135 of the Constitution and is void; (d) the petition alleges sufficiently a cause of action based on fraud and collusion; and (e) the order of the Commission was unconstitutional in that it impaired the obligation of contracts.

We will discuss the points raised, categorically, under the same letters of designation used above:

A. KRS 324.170 provides that the applicant or licensee shall be given written notice of the charges made and the date and place of the hearing. The notice served in the instant cause -- after definitely fixing the time and place of hearing -- states:

'This action is predicated upon information received by this Commission to the effect that in the submission of your application for broker's license which was received in this office on January 12, 1952, you obtained a license through false or fraudulent representations in violation of Subsection (a) of Section 324.160 Kentucky Revised Statutes, in that your application indicates that Mrs. Nick Loving of Box 194-A, Dudley Pike, Covington, Kentucky and Mrs. Margie Fierbery of 1826 Scott Street, Covington, Kentucky, signed and endorsed your application, said application providing in writing that two real estate owners must certify that you as an applicant possessed a good reputation for honesty, competency and fair dealings. The facts indicate that neither of such individuals signed your application, but that to the contrary someone else signed their names without their permission and ...


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