STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA REAL ESTATE )

COMMISSION, )

)

Petitioner, )

)

vs. ) CASE NO. 79-031

)

TOMBERG REALTY, INC., and )

SAUL TOMBERG, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings by its duly designated Hearing Officer, C. Steven Pfeiffer, held a final hearing in this case in West Palm Beach, Florida on June 18, 1979. The following appearances were entered: Fred Langford, Orlando, Florida, for the Petitioner, Florida Real Estate Commission; and Robert M. Montgomery, Jr., West Palm Beach, Florida, for the Respondents, Tomberg Realty, Inc. and Saul Tomberg. On or about August 19, 1977, the Florida Real Estate Commission issued an administrative complaint against the Respondents, Tomberg Realty, Inc. and Saul Tomberg. The Respondents requested an administrative hearing, and on January 4, 1979, the Real Estate Commission forwarded the matter to the office of the Division of Administrative Hearings for the assignment of a Hearing Officer and the scheduling of a hearing. The final hearing was scheduled by notice dated January 15, to be conducted on March 20, 1979. The final hearing was continued on two occasions, and was ultimately conducted as set out above by order entered April 30, 1979.

At the final hearing the Respondents moved to dismiss the complaint alleging that it was not filed within the period of the applicable statute of limitations, and that the doctrine of laches barred the complaint. The motion was denied. The Real Estate Commission called the following witnesses: David Frank, Benny Teper, Adelaide Ferraro, all of whom purchased property through the Respondents; and Mable Polagy, an associate of the Respondent Sol Tomberg. The Respondent testified as a witness on his own behalf. Petitioner's Exhibits 1 through 4 and Respondent's Exhibits 1 through 5 were offered into evidence and were received.

FINDINGS OF FACT

1. The Respondents have, at all times material to this matter, been registered with the Florida Real Estate Commission as real estate brokers.

   
   

2. During 1973 and 1974, the Respondent Sol Tomberg worked at Century Realty, Inc. as a salesman and a broker. He was primarily involved in selling condominium units in a project known as Century Village in Palm Beach County, Florida. Century Village is a large condominium project. Units were much in demand during the time that Respondent was engaged to sell them, and sales activity was brisk.

3. During 1973, David Frank was seeking to purchase a condominium unit at Century Village. He asked a friend, a Mr. Helwitz, to assist him in locating a unit to purchase. On April 16, 1973, Helwitz called Frank, who was then living in New York. Helwitz introduced the Respondent Sol Tomberg who spoke to Mr. Frank. Tomberg advised Frank that a unit was available, but that another party had an option to purchase it. Tomberg advised Frank that if the other party were paid $500.00 they would be willing to give up their option, and Frank would be able to purchase the condominium unit from the developer. In accordance with Tomberg's instructions, Frank issued a check for $1,500.00 payable to Century Village to hold the condominium unit, and a check for $500.00 to Mr. Tomberg personally to arrange the payment to the party who held the option. Frank eventually closed the condominium transaction successfully. Tomberg deposited the $500.00 check that he received from Frank in his personal checking account. He testified that he distributed it in cash to the party who held the option.

   It is apparent from the evidence that another party did have an option to purchase the unit which Frank ultimately purchased. There is no evidence from which it could be concluded that Tomberg realized any secret profit on the transaction, or that he did other than distribute the $500.00 payment to the party who had the option to purchase. It does appear that an option to purchase was rescinded. The evidence does establish that Tomberg did not deposit the

   $500.00 he received from Frank into an escrow account.

   
   

4. During 1973, Benny Teper was seeking to purchase a condominium unit at Century Village. He enlisted the assistance of a friend, Mr. Myers, an individual who had already purchased a unit at Century Village. Apparently Mr. Myers contacted the Respondent Tomberg, and on June 6, 1973, Tomberg contacted Teper. He advised Teper that a condominium unit could be obtained, but that another party (Tomberg's mother-in-law) had an option to purchase the unit. Tomberg advised Teper that the party would be willing to give up the option for

   $1,500.00. Teper bargained with Tomberg, and agreed to pay $1,200.00 for release of the option in addition to the purchase price of the condominium. Accordingly, Teper sent a deposit to Century Realty to hold the unit, and a check to Tomberg for $1,200.00 to obtain release of the option. Tomberg deposited the $1200.00 in his personal checking account. He testified that he distributed it at a later date. Teper successfully closed the transaction for the condominium unit. The evidence does not establish that Tomberg realized any secret profit on the Teper transaction, or that he did other with the $1,200.00 than obtain a release of an existing option. It does appear from the evidence that another party did hold an option to purchase the unit that Teper ultimately purchased, and that the option was released just prior to the time that Teper made a deposit to hold the unit. The evidence does establish that Tomberg deposited the $1,200.00 that he received from Teper in his personal checking account rather than in any trust or escrow account.

   
   

5. During 1972 and 1973, Adelaide Ferraro was seeking to purchase a condominium unit in Century Village. She visited Tomberg's office, and was advised that no units were available, but that Tomberg's mother-in-law had an option to purchase a unit which she would release for $1,000.00 above the purchase price. Ferraro agreed to make such a payment. She made out a $200.00 check to Tomberg and later an $800.00 check to cover the $1,000.00. She also made out a check to Century Realty to place a hold on the unit. Tomberg deposited the $200.00 check and the $800.00 check in his personal checking account. Ferraro was able to successfully close on the transaction. Tomberg actually owned the option to purchase the unit which Ferraro ultimately purchased himself. When he failed to disclose this fact to Ferraro, he

   concealed from her the true facts involving the transaction. Tomberg did not deposit the $1,000.00 in any trust or escrow account.

   
   

6. During 1973, Laura Katz was seeking to purchase a condominium unit in Century Village. She contacted Tomberg, who advised her that no units were available, but that a third party who had an option to purchase a unit would be willing to give up the option. Katz agreed to pay $2,100.55 to procure release of the option, and $345.00 for certain extras that the option holder had included in the unit (a refrigerator, a stove, and carpeting). She made out a check in the amount of $2,155.00 to Tomberg, and a check to Century Realty to place a hold on the unit. Tomberg deposited the check In his personal checking account. Katz successfully closed the transaction. Tomberg testified that he distributed the money to the party who held the option. It does appear from the evidence that a third party did possess an option on the unit that Katz ultimately purchased, and that the option was released shortly before Katz made her deposit to hold the unit. The evidence does not establish that Tomberg realized any secret profit on the transaction, that he misrepresented any facts with respect to it, or that he did other with the money deposited with him by Katz than to secure release of an option. The evidence does establish that Tomberg deposited the money he received from Katz in his personal checking account rather than in a trust or escrow account.

   
   

7. No evidence was offered with respect to a transaction in which Edna Patrick allegedly purchased a unit at Century Village as alleged in Counts 17 through 20 of the administrative complaint filed by the Real Estate Commission.

   
   

   CONCLUSIONS OF LAW

   
   

8. The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding and over the parties.

   
   

9. The Respondents have moved to dismiss the administrative complaint on the grounds that the applicable statute of limitations, or the doctrine of laches bars the action. The matters complained of in the complaint occurred during 1973. The administrative complaint was issued on August 19, 1977. The passage of this period of time does not, in and of itself, establish that the action was improperly maintained. No statute of limitations which applies to administrative proceedings to suspend or revoke a professional license has been found. As to the doctrine of laches, the Respondents contended in making the motion that many of the records that would have established the their innocence were gone due to the passage of time. No evidence was offered to this effect however, and no evidence was offered from which it could be concluded that the Respondents were in any way unduly prejudiced by the failure of the Real Estate Commission to bring the action sooner.

   
   

10. Counts 1 through 4 of the administrative complaint relate to the Frank transaction. In Count 1 it is alleged that Tomberg failed to deliver any release of option to Frank. In Count 2 it is alleged that no option existed, and in Count 4 it is alleged that Tomberg realized a separate profit. These allegations have not been sustained by the evidence. It does appear that an option to purchase the unit which Frank ultimately purchased was released shortly before Frank made the deposit. It has not been established that no option existed, or that Tomberg realized any secret profit. In Count 4 it is asserted that Tomberg failed to deposit money he received from Frank in connection with the transaction in an escrow account. This allegation has been sustained. Tomberg deposited the money in his personal checking account. This constitutes a violation of Section 475.25(1)(i) , Florida Statutes.

11. Counts 5 through 8 of the administrative complaint relate to the Teper transaction. In Count 5 it is alleged that Tomberg failed to deliver a release of option to Teper. In Count 6 it is alleged that no option existed. In Count

    8 it is alleged that Tomberg realized a secret profit on the transaction. These allegations have not been sustained. It does appear that an option to purchase a condominium unit ultimately purchased by Teper was released shortly before Teper made a deposit to hold the condominium unit. It has not been established that Temberg did other with the money given him than section the release of an option as he testified. In Count 7 it is alleged that Tomberg failed to deposit the money he received from Teper in an escrow account. This allegation has been sustained. Tomberg deposited the money in his personal checking account. This conduct constitutes a violation of Section 475.25(1)(i), Florida Statutes.

    
    

12. Counts 9 through 12 of the administrative complaint relate to the Ferraro transaction. In Count 9 it is alleged that Tomberg failed to deliver a release of option to Ferraro. In Count 10 it is alleged that no option to purchase existed. In Count 12 it is alleged that Tomberg realized a secret profit on the transaction. These allegations have not been established. It does appear from the evidence that an option to purchase the property was released shortly before the time that Ferraro made a deposit to hold the condominium unit. It has not been established that Tomberg did other than distribute the $1,000.00 to the person who held the option. In fact, it has been established that Tomberg himself held the option. In Count 11 it is alleged that Tomberg failed to deposit the $1,000.00 in his escrow account.

    This allegation has been sustained. Tomberg deposited the $1,000.00 in his personal checking account. This constitutes a violation of Section 475.25(1)(i)

    , Florida Statutes.

    
    

13. Counts 13 through 18 of the administrative complaint relate to the Katz transaction. In Count 13 it is alleged that Tomberg failed to deliver a release of the option to Katz. In Count 14 it is alleged that no option to purchase existed. In Count 16 it is alleged that Tomberg realized a secret profit on the transaction. These allegations have not been sustained. The evidence reveals that an option to purchase was released shortly before Katz made a deposit to hold the condominium unit. The evidence does net reveal that Tomberg did other with the money received from Katz than secure a release of the option. In Count 15 it is alleged that Tomberg did not deposit the money he received from Katz in an escrow account. This allegation has been sustained. Tomberg deposited the money in his personal checking account. This constitutes a violation of Section 485.25(1)(i) , Florida Statutes.

    
    

14. Counts 17 through 20 of the administrative complaint relate to a transaction involving Edna Patrick. No evidence was offered with respect to this transaction, and the allegations of Counts 17 through 20 have not been sustained.

    
    

15. In Count 21 it is alleged that Tomberg has been guilty of a course of conduct which show him to be so dishonest or untruthful that the money, property, transactions and rights of others cannot be safely entrusted to him in violation of Section 475.25(3), Florida Statutes. It has been established that Tomberg failed to place monies in an escrow account as required by law on four separate occasions. These are serious violations of the law. The violations make it very difficult to account for monies taken by Tomberg from purchasers of real estate. Tomberg engaged in a course of conduct which necessarily renders his activities suspicious, and makes it difficult to account for his activities. A suspension of his license for a substantial period of time is justified,

however, the violations do not meet the requirements of Section 475.25(3) and a revocation would not be justified.

RECOMMENDED ORDER

Based upon the foregoing Findings of Fact and Conclusions of Law, it is, hereby,

RECOMMENDED:

That a final order be entered by the Florida Real Estate Commission suspending the licenses of the Respondents as real estate brokers for a period of two years from the date of the final order.

Recommended this 18th day of July, 1979, in Tallahassee, Florida.

G. STEVEN PFEIFFER Assistant Director

Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301

(904) 488-9675

COPIES FURNISHED:

Fred Langford, Esquire

Florida Real Estate Commission Post Office Box 1900

Orlando, Florida 32802

Robert M. Montgomery, Jr., Esquire 2139 Palm Beach Lakes Boulevard West Palm Beach, Florida

Docket for Case No: 79-000031

Orders for Case No: 79-000031