STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA REAL ESTATE COMMISSION, )

)

Petitioner, )

)

vs. ) DOCKET NO. 77-1732

)

D. LOIS SMITH, )

)

Respondent. )

)

RECOMMENDED ORDER

A hearing was held in the above captioned matter, after due notice, at Winter Park, Florida on November 28th, 1977, before the undersigned Hearing Officer.

APPEARANCES

For Petitioner: Joseph A. Doherty, Esquire

Florida Real Estate Commission 2699 Lee Road

Winter Park, Florida 32789

For Respondent: S. G. Green, Esquire

816 East Washington Street Orlando, Florida 32801

ISSUE PRESENTED

Whether disciplinary action should be taken against Respondent for alleged violation of 475.25(1)(a), Florida Statutes, as set forth in Petitioner's Administrative Complaint.

FINDINGS OF FACT

1. Respondent D. Lois Smith is a registered real estate salesman with the Florida Real Estate Commission and was so registered at the time of the allegations set forth in the Administrative Complaint (Petitioner's Composite Exhibit 1).

   
   

2. On April 16th, 1975, Respondent, who had inherited a used car lot and junk yard from her recently-deceased husband, located at Mascotte, Florida, entered into a written agreement with Garlon B. Arant, and Florence M. Arant, his wife, to purchase the business, including the land and a building thereon, together with certain automobiles and tools and equipment on the premises. The agreement was prepared by Father Dennis J. Kelso, a priest who was a friend of the Smiths and had been assisting Respondent in her personal affairs since her husband's death. The agreement was in an abbreviated form and did not specify with particularity the items of equipment and automobiles that were included in the proposed purchase. The agreement simply stated that included under the

   contract were "all cars that will not be crushed", "all tools, air compressor, battery charger, etc.", "all hand tools and any other equipment that's in the garage". It stated that not to be included in the contract were "all cars in the front", "file cabinets", "fireproof", "motorcycle", and "accounts receivables". It further provided that the Arants would pay $4000.00 in cash and assume a mortgage of $23,000.00, and make up three payments in arrears amounting to

   $939.00. The agreement further referenced that the Arants had paid an "advance" of $1,000.00 as a down payment on the purchase (Testimony of Respondent, Garlon and Florence Arant, Kelso, petitioner's Composite Exhibit 1).

   
   

3. The evidence presented at the hearing as to the circumstances surrounding the proposed transaction and the reasons for its failure to be consummated was conflicting, but the preponderance of the competent evidence establishes a sequence of events as hereinafter determined as Findings of Fact.

   
   

4. At an undisclosed point in time prior to signing the agreement, Garlon Arant visited the property in question and became aware of what was located thereon. After preliminary negotiations, the parties agreed that a number of wrecked but repairable automobiles located on the premises would be included in the purchase and all items of tools and equipment other than that specifically excluded in the written agreement. At the time the contract was executed, Garlon Arant gave Respondent a check for $1,000.00 as a down payment. He later accompanied Kelso to the Exchange Bank of Clermont where he qualified for assumption of the existing mortgage (Testimony of Smith, Kelso, F. Arant, Petitioner's Composite Exhibit 1).

   
   

5. Several days after execution of the contract, Arant, accompanied by Kelso, visited the car lot, and observed that a number of cars were being crushed or "junked". He became quite agitated and concerned as to whether Respondent was aware of this fact. Respondent came out to the premises and assured Arant that the cars in question were some of those that she had retained under the contract. There was no discussion at this time concerning any of the equipment or tools that had been included in the agreement. Several days thereafter, Arant advised Kelso that due to the fact that he had been in a car accident and his back was hurting him and that his wife was having nightmares, he wished to cancel the contract. Although Arant asked for the return of his

   $1,000.00 down payment, Respondent informed him that she had no legal obligation to do so but that when her husband's estate was settled, she would return the money. However, she testified at the hearing that she has been unable to do so due to lack of funds (Testimony of Respondent, Kelso).

   
   

6. Subsequent to the failure of Arant to close the transaction, Respondent sold the automobiles on the lot to various auction dealers. In the summer of 1975, she sold the equipment that had been the subject of the contract to Clarence Owens, the proprieter of a body shop in Groveland, Florida, for the sum of $600.00. In September, 1975, the Exchange Bank of Clermont obtained a Final Judgment of foreclosure on the property and thereafter sold the same at public sale (Testimony of Respondent, Owens, Campbell, Samples, stipulated tesimony of

   W. Stiefel, H. Stiefel, Pevey, Fletcher, Petitioner's composite exhibit 1).

   
   

   CONCLUSIONS OF LAW

   
   

7. Petitioner charges the Respondent with fraud, misrepresentation, concealment, dishonest dealing and breach of trust in a business transaction in violation of 475.25(1)(a), Florida Statutes. The manner in which the complaint is framed indicates that Petitioner seeks to find Respondent's culpability in not revealing to the purchaser Arant that certain tools to be sold under the

   contract had previously been stolen from the car lot and were no longer available for sale. Further, that after the contract was made, Respondent sold certain of the remaining tools to Clarence Owens for $600.00 without the buyer's knowledge. It further alleges that after Arant discovered the tools and equipment missing, he advised Respondent that he would not fulfill the contract and after demanding return of his $1,000.00 deposit, Respondent promised to repay the same but has refused to do so.

   
   

8. The preponderance of the evidence as heretofore found establishes that all tools and equipment to pass under the terms of the contract were present at the time the contract was executed. It further establishes that none of the equipment was sold to a third party until after Arant had announced his disinclination to close the transaction. Although there was some question as to whether hand tools had been included in the property sold to Owens by the Respondent, the vagueness of the agreement and lack of specificity precludes any determination as to their presence or absence at any time during the transaction. It is therefore concluded that Petitioner has failed to show that Respondent committed any fraudulent or otherwise dishonest act in connection with the transaction in violation of the specified statutory provision.

RECOMMENDATION

That the charges against the Respondent D. Lois Smith be dismissed.

DONE and ENTERED this 3rd day of January, 1978, in Tallahassee, Florida.

THOMAS C. OLDHAM

Hearing Officer

Division of Administrative Hearings

530 Carlton Building Tallahassee, Florida 32304

COPIES FURNISHED:

Joseph A. Doherty, Esquire Florida Real Estate Commission 2699 Lee Road

Winter Park, Florida 32789

S. G. Green, Esquire

816 East Washington Street Orlando, Florida 32801

Docket for Case No: 77-001732

Orders for Case No: 77-001732