STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF REVENUE, )

)

Petitioner, )

)

vs. ) CASE NO. 77-1456

) SHERWOOD GARDEN APARTMENTS, INC., )

)

Respondent. )

)

RECOMMENDED ORDER

This matter came on for hearing in Fort Lauderdale, Florida, before the Division of Administrative Hearings by its duly designated Hearing Officer, Robert T. Benton, II, on November 21, 1977. The parties were represented by counsel:

For Petitioner: Mr. Edwin J. Stacker, Esquire

Assistant Attorney General The Capitol

Tallahassee, Florida 32304

For Respondent: Mr. Ronald Payne, Esquire

621 South Federal Highway Fort Lauderdale, Florida

By notice of proposed assessment, dated June 29, 1977, petitioner asserted a documentary stamp tax deficiency in connection with a quitclaim deed recorded in Broward County on December 29, 1976. Before the hearing began, petitioner's counsel moved for a continuance on the ground that a witness whom he had hoped would be on hand, but for whom no subpoena had issued, was not present. The motion was denied.

FINDINGS OF FACT

1. John F. Cole, David J. Hayes and Andre LeClerc conveyed certain real estate situated in Broward County ("the property") to respondent by quitclaim deed dated December 16, 1976, and recorded on December 29, 1976. This instrument reflects payment of a documentary stamp tax in the amount of thirty cents ($0.30) as well as a documentary surtax.

   
   

2. On September 30, 1971, Thomas N. Sprague and Peggy A. Sprague had mortgaged the property to Merle Ford to secure repayment of the principal sum of twenty-three thousand five hundred dollars ($23,500.00). On October 1, 1971, the Spragues mortgaged the property to Atlantic Federal Savings and Loan Association of Fort Lauderdale to secure repayment of the principal sum of one hundred three thousand dollars ($103,000.00)

3. On November 21, 1973, John A. Kasbar, as trustee, mortgaged the property to the Spragues to secure repayment of the principal sum of twenty- three thousand one hundred dollars ($23,100.00)

   
   

4. On June 5, 1969, Esther E. Adams conveyed the property by warranty deed to Andre LeClerc, as trustee. The warranty deed reflected payment of a documentary stamp tax in the amount of five hundred forty-three dollars ($543.00).

   
   

5. The property which was the subject of these transactions is evidently worth a substantial sum of money, but the evidence fails to establish the value of the interest quitclaimed on December 16, 1976, and does not establish what consideration for the quitclaim deed was given, if any was given.

   
   

   CONCLUSIONS OF LAW

   
   

6. Section 201.01, Florida Statutes (1975), levies an excise tax on "deeds

. . . at the rate of 30 cents for each $100 or fractional part thereof of the consideration therefor." Section 201.02, Florida Statutes (1975).

Consideration may take the form of cash, a formal assumption of an outstanding mortgage, or even the informal undertaking implicit in accepting property which is subject to an outstanding mortgage. Florida Department of Revenue v.

DeMaria, 338 So.2d 838 (Fla. 1976). In the present case, however, there was no proof of consideration of any kind in exchange for the quitclaim deed in question. The evidence did establish the existence of mortgages which were outstanding as recently as three years before the quitclaim deed in question.

The evidence did establish the existence of mortgages which were outstanding as recently as three years before the quitclaim deed was executed; but this gives rise to no presumption that the mortgages remained outstanding at the time of the conveyance.

RECOMMENDATION

Upon consideration of the foregoing, it is RECOMMENDED:

That the notice of proposed assessment be withdrawn.

DONE and ENTERED this 13th day of December, 1977, in Tallahassee, Florida.

COPIES FURNISHED:

Mr. Edwin J. Stacker, Esquire Assistant Attorney General The Capitol

Tallahassee, Florida 32304

ROBERT T. BENTON, II

Hearing Officer

Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304

(904) 488-9675

Mr. Ronald Payne, Esquire 621 South Federal Highway Fort Lauderdale, Florida

Docket for Case No: 77-001456

Orders for Case No: 77-001456