Rogers v. Edmonds

Opinion

POCHE, J.

Defendant Real Estate Commissioner (Commissioner) appeals from an order directing him to pay plaintiffs, Dr. and Mrs. Rogers, $38,420.79 from the Real Estate Recovery Account. (Bus. & Prof. Code, § 10471.)

1

We affirm the order.

The Recovery Account in the Real Estate Fund (Fund) created by section 10470 et seq. is “a special fund supported by license fees to compensate individuals who are defrauded by real estate licensees.”

(Vinci

v.

Edmonds

(1986) 185 Cal.App.3d 1251, 1254 [230 Cal.Rptr. 308].) Section 10471, subdivision (a), as it read at the date of the order appealed from provided that once “an aggrieved person obtains a final judgment in a court of competent jurisdiction against a defendant based upon the defendant’s fraud, misrepresentation, deceit, or conversion of trust funds arising directly out of any transaction in which the defendant, while licensed under this part, performed acts for which that license was required, the aggrieved person may, upon the judgment becoming final, file an application . . . for payment from the Recovery Account, . . .” (Former § 10471, added by Stats. 1985, ch. 690, § 3, p. 2293-2294.)

Dr. and Mrs. Rogers made real estate investments in three different properties through real estate broker Stan Hatkoff. The investments were unsuccessful and on July 29, 1982, the Rogers filed a complaint against

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Hatkoff for breach of contract, breach of fiduciary duty, fraud and misrepresentation. In August 1984 Hatkoff filed a petition for bankruptcy and received a discharge of his debts on November 27, 1984.

On March 21, 1985, the bankruptcy court issued an order relieving the Rogers from the automatic stay “for the sole and exclusive purpose of liquidating their claim against the debtor in order to enable them to ascertain the amount of the claim for purposes of filing a petition . . . against the California Real Estate Education Research and Recovery Fund . . . .”