Valiyee v. Department of Motor Vehicles

Opinion

Reza Valiyee timely appeals from an order of the trial court denying his petition for writ of administrative mandamus (Code Civ. Proc., § 1094.5). By his petition, Valiyee sought to set aside a decision of respondent Department of Motor Vehicles (DMV or the agency) revoking his license as an automobile dealer. Exercising its independent judgment on the evidence presented before a DMV hearing officer, the trial court found the weight of the evidence supported the agency’s finding that Valiyee

On August 26, 1996, Valiyee filed a petition for writ of administrative mandamus pursuant to Code of Civil Procedure section 1094.5, seeking to set aside the DMV action. After a hearing on February 26, 1998, the court found that although Valiyee had been licensed for six and a half years, he had not conducted business as a dealer and that, for three years, the vehicle sales activity at Best was conducted by Tajbakhsh under an arrangement with Valiyee to use his dealer’s license. Judgment denying Valiyee’s petition was entered on March 20, 1998. This timely appeal followed.

A. Substantial Evidence Supports the DMV’s Findings and Decision.

The parties agree that the trial court was required to exercise its independent judgment on the evidence presented in the administrative hearing and to determine whether the weight of the evidence supported the DMV’s decision, which comes to the courts with a “strong presumption of correctness.” (Fukuda v. City of Angels (1999) 20 Cal.4th 805 , 811-812, 817 [ 85 Cal.Rptr.2d 696 , 977 P.2d 693 ], On appeal, our task is to determine whether the trial court’s findings are supported by substantial evidence. (Id. at p. 824.) We must “ ‘ “resolve all evidentiary conflicts and draw all legitimate and reasonable inferences in favor of the trial court’s decision.” ’ ” (Lake v. Reed (1997) 16 Cal.4th 448 , 457 [ 65 Cal.Rptr.2d 860 , 940 P.2d 311 ].) Where the evidence supports more than one inference, we may not substitute our view of the evidence for the trial court’s, and may overturn the trial court’s findings of fact only if the evidence is insufficient to support those findings as a matter of law. (Ibid.) Under this standard of review, we conclude there is no basis for reversal of the trial court’s order.

In order to conduct business as a vehicle dealer in California, an individual must apply for and obtain a license from the DMV. (§ 11700.) A “dealer” is defined by statute as a person who is engaged in the business, “wholly or in part,” in the selling or buying of vehicles for the purpose of selling vehicles “or otherwise dealing in vehicles, whether or not such vehicles are owned by such person.” (§ 285.) The Vehicle Code specifically excludes from the definition of “dealer” certain individuals, including salespersons who are employed by vehicle dealers while acting within the scope of their employment. (§ 286.) Through this statutory scheme, the Legislature intended to control who would be permitted to act as a vehicle dealer in

In relevant part, section 11713 prohibits a licensed dealer from allowing another person to use the dealer’s license, supplies, or books for the purpose of engaging in the business of a dealer, as follows: “No holder of any license issued shall . . . [¶] . . . [¶] (m) Permit the use of the dealer’s license, supplies, or books by any other person for the purpose of permitting that person to engage in the purchase or sale of vehicles required to be registered under this code, or permit the use of the dealer’s license, supplies, or books to operate a branch location to be used by any other person, whether or not the licensee has any financial or equitable interest or investment in the vehicles purchased or sold by, or the business of, or branch location used by, the other person.”

Valiyee contends that he is not subject to discipline under section 11713(m), because the statute is unconstitutionally vague in describing the conduct it proscribes. He further contends that the trial court’s finding of a violation of section 11713(m) was not supported by substantial evidence. We reject these arguments.

Of course, “Due process requires fair notice of what conduct is prohibited.” (People v. Townsend (1998) 62 Cal.App.4th 1390 , 1400 [ 73 Cal.Rptr.2d 438 ].) In that regard, a statute must be definite enough to provide a standard of conduct for citizens and guidance for officials to avoid arbitrary and discriminatory enforcement. (Ibid.) “ ‘ “[A] statute which either forbids or requires the doing of an act in terms so vague that men of common intelligence must necessarily guess at its meaning and differ as to its application violates the first essential of due process of law.” [Citations.] A statute must be definite enough to provide a standard of conduct for those whose activities are proscribed as well as a standard for the ascertainment of guilt by the courts called upon to apply it. [Citations.]’ ” (People v. Duz-Mor Diagnostic Laboratory, Inc. (1998) 68 Cal.App.4th 654 , 670 [ 80 Cal..Rptr.2d 419 ], quoting People v. McCaughan (1957) 49 Cal.2d 409 , 414 [ 317 P.2d 974 ], and Connally v. General Const. Co. (1926) 269 U.S. 385 , 391 [ 46 S.Ct. 126 , 127-128, 70 L.Ed. 322 ].) However, “[a] statute is not vague if, as here, any reasonable and practical construction can be given to its language. Reasonable certainty is all that is required. [Citations.]” (People v. Townsend, supra, at p. 1401; see also People v. Hodges (1999) 70 Cal.App.4th 1348 , 1354 [ 83 Cal.Rptr.2d 619 ].)

It is simply not true, as Valiyee claims, that the only conduct in violation of section 11713(m) “amounts to nothing more than the reports of sale being signed by a person other than the dealer himself.” Nor is there any basis for concluding that Tajbakhsh was an authorized agent of Valiyee’s for purposes of signing and submitting those reports. An agency relationship requires that the principal has the right to control the activities of the “agent,” and that the principal has conferred authority upon the agent to act on his or her behalf. (Civ. Code, § 2315; Malloy v. Fong (1951) 37 Cal.2d 356 , 370 [ 232 P.2d 241 ].) As far as this record discloses, Valiyee essentially turned his license, books, forms, and business premises over to Tajbakhsh to operate, without limitation, as Tajbakhsh saw fit. There is nothing in this record suggesting that Valiyee retained or exercised any right to control Tajbakhsh’s conduct of the dealership business. On the contrary, Valiyee admitted that Tajbakhsh took care of “everything that was going on with the business.”

Valiyee’s argument that his arrangement with Tajbakhsh was a lawful “independent contractor” relationship is beside the point, and the sole case

Likewise, we conclude there is substantial evidence to support the trial court’s finding of a violation of section 11705(a)(3). In relevant part, that statute provides: “(a) The department, after notice and hearing, may suspend or revoke the license issued to a dealer . . . upon determining that the person to whom the license was issued is not lawfully entitled thereto, or has ... [¶] ... [¶] (3) Used a false or fictitious name, knowingly made any false statement, or knowingly concealed any material fact, in any application for the registration of a vehicle, or otherwise committed a fraud in the application.” (Italics added.) The conduct in violation of this provision is closely related to the conduct found to constitute a violation of section 11713(m). That is, over a three-year period, all of the reports of sale from Best that were signed by Tajbakhsh and submitted to the DMV as part of the application for registration of vehicles, falsely represented that appellant was the licensed dealer in the sales transactions. As we have noted, appellant was at no time during that three-year period acting or fulfilling his responsibilities as a licensee, having relinquished control of the business operations of the dealership to Tajbakhsh. While it is clear that an “authorized agent” of a dealer may lawfully sign the reports of sale (§ 4456, subd. (a)(3)(C)), that is simply not what happened here. As we have discussed, Tajbakhsh was not acting as an agent for Valiyee. Rather, under his arrangement with Valiyee, Tajbakhsh was allowed to assume the role of a licensed dealer, when in fact he was not a licensed dealer. Yet, in their communications with the DMV, the two men kept up the charade that Valiyee was the licensee who was running Best. In these circumstances, the trial court did not err in finding that Valiyee was responsible for making false statements in the reports of sale, in violation of section 11705(a)(3).

Valiyee recognizes that the proper measure of discipline to be imposed against a licensee for violations of the Vehicle Code is a matter entrusted to the sound discretion of the DMV. (See Evilsizor v. Department of Motor Vehicles (1967) 251 Cal.App.2d 216 , 219 [ 59 Cal.Rptr. 375 ] {Evilsizor).) He contends, however, that the DMV abused its discretion in this case by revoking his license rather than imposing some lesser form of discipline. He claims the violations proven by the agency were “entirely technical in nature,” and points out that he has no prior history of misconduct. The revocation was all the more unjustified, Valiyee contends, because no consumer was injured by the statutory violations in this case. We reject these arguments.

Valiyee’s argument that his violations were purely “technical” is simply a reprise of his claim that the proven violations of section 11713(m) and section 11705(a)(3) amount to “nothing more than the reports of sale being signed by a person other than the dealer himself.” As we have discussed, this argument mischaracterizes the evidence.

The Legislature has specifically authorized the DMV to revoke the license of a dealer who violates section 11705(a)(3) or section 11713(m). (§ 11705(a)(3); id., subd. (a)(10).) Nevertheless, citing Rob-Mac, supra, 148 Cal.App.3d 793 , and Evilsizor, supra, 251 Cal.App.2d 216 , Valiyee contends that the punishment in this case—revocation—is disproportional to the offenses established by the evidence. This, he claims, establishes an abuse of discretion. We disagree.

While it is true the DMV imposed less severe discipline in Rob-Mac and Evilsizor, it is far from clear that the misconduct of the licensees in those cases was as serious as that of Valiyee. In Rob-Mac, the court specifically noted that the decision of the DMV to impose only mild discipline—a 15-day license suspension, stayed for a 2-year probationary period—was undoubtedly affected by the agency’s evaluation of the “relative culpability” of the dealer and the salesperson who, in that case, knowingly sold seven vehicles with reset odometers and concealed that fact from the dealer. (148 Cal.App.3d at pp. 796, 799.) Thus, the court upheld the DMV’s determination regarding the appropriate level of discipline. (Id. at p. 800.)

In Evilsizor, the court approved a decision of the DMV imposing a 60-day suspension, all but 15 days of which was stayed during a 3-year period of probation. (251 Cal.App.2d at p. 218.) The evidence showed that on 45

In this case, Valiyee’s violations were arguably more serious than those found in Evilsizor, and of longer standing than those found in Rob-Mac. The evidence of wholesale relinquishment of his dealer’s license to another person for three years, and of falsification of reports to the DMV throughout that period, shows an utter disregard for the whole legislative scheme for regulating motor vehicle dealers and its fundamental purpose of protecting the public from irresponsible and unscrupulous dealers. Valiyee’s statements to DMV investigators disavowing any responsibility for the problems experienced by Keith May illustrate just how completely he had abandoned his duties as a licensee. By his conduct, Valiyee has demonstrated that he is not qualified to hold a dealer’s license. The DMV’s decision to revoke his license in these circumstances was not, in short, an abuse of discretion.

For all the foregoing reasons, the judgment of the trial court is affirmed. Costs to respondent.

Hanlon, P. J., and Poché, J., concurred.