SHARATH CHANDRA, ADMINISTRATOR, NEVADA REAL ESTATE DIVISION, Appellant,
MELANI SCHULTE; AND WILLIAM R. SCHULTE, Respondents.
from district court orders directing payment from the Real
Estate Education, Research and Recovery Fund. Eighth.
Judicial District Court, Family Court Division, Clark County;
Cheryl B. Moss, Judge.
D. Ford, Attorney General, David J. Pope, Chief Deputy
Attorney General, and Donald J. Bordelove, Deputy Attorney
General, Carson City, for Appellant.
Office of Amberlea Davis and Amberlea S. Davis, Las Vegas,
for Respondent Melani Schulte.
R. Schulte, in Pro Se.
HARDESTY, STIGLICH and SILVER, JJ.
Nevada Real Estate Education, Research and Recovery Fund (the
Fund) compensates victims of real estate fraud whose judgment
against a fraudulent real estate licensee is uncollectable.
In this appeal, the Administrator of the Nevada Real Estate
Division challenges nine orders directing payment from the
Fund, one to Melani Schulte individually and eight to various
LLCs in her control. The orders stem from Melani's
then-husband William Schulte's fraudulent management of
properties, all but one of which were jointly owned by the
Schultes. Because Melani and William were married at the time
of the fraud, we conclude that the spousal exception to Fund
recovery in NRS 645.844(4)(a) prohibits Melani's
individual recovery and the district court erred in granting
her an award from the Fund. Further, because transactions
involving one's own properties do not require a real
estate license, the district court erred in granting awards
to the eight LLCs under NRS 645.844(1). Accordingly, we
reverse the nine district court orders directing payment from
William and Melani Schulte jointly owned numerous properties
during their marriage. William, who at the time was a real
estate licensee, managed these properties, among others,
while working for his and Melani's real estate management
business. In 2013, the Nevada Real Estate Commission found
that William committed real estate misconduct by defrauding
both third-party clients and also fraudulently managing his
and Melani's jointly owned properties. Melani was
uninvolved in the misconduct.
2013, the district court granted a divorce between William
and Melani. In the divorce decree, the district court awarded
numerous properties that William fraudulently managed to
Melani. These properties are currently held by distinct LLCs
with Melani as the successor in interest.
of the divorce proceeding, the district court granted 21
individual judgments against William resulting from his real
estate misconduct. One judgment was in favor of Melani for a
payment she made to a third-party client to satisfy an
outstanding judgment due to William's fraud. Twenty
judgments were in favor of Melani's distinct LLCs. These
judgments compensated the LLCs for William's failure to
remit rent and security deposits while managing the LLCs
properties that, at the time, he and Melani jointly owned.
failing to collect on the judgments from William, Melani
filed nine verified petitions for orders directing payment
from the Fund, one requesting payment to Melani as an
individual and eight to her LLCs, Appellant Sharath Chandra,
as the Administrator of the Nevada Real Estate Division,
opposed these petitions. The district court granted the
petitions in nine nearly identical orders. Chandra
Fund is a special revenue fund that aids victims of real
estate fraud whose judgments against real estate licensees
have proven to be uncollectable. See NRS 645.842; Colello
v. Adm'r of Real Estate Div. of State of Nev., 100
Nev. 344, 347, 683 P.2d 15, 16 (1984). In this appeal, we
consider whether the district court properly granted
Melani's petitions for recovery from the Fund under NRS
645.844 for both herself individually and for the eight LLCs
under her control. In doing so, we must determine whether the
spousal exception to recovery under NRS 645.844(4)(a) applies
to Melani, who was married to William at the time of his
misconduct but was no longer married at the time she sought
recovery from the Fund. We also ...