STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA REAL ESTATE COMMISSION )

)

Petitioner, )

)

vs. ) CASE NO. 79-384

) P.D. NO. 3446 ALINCO ASSOCIATES, INC., ALFRED )

C. COURIC, JR., CAROL L. ASTIN, ) and REGINALD D. LUCAS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, K.N. Ayers, held a public hearing in the above- styled case on June 7, 1979 at Ft. Lauderdale, Florida.

APPEARANCES

For Petitioner: John Namey Esquire, Staff Attorney

Florida Real Estate Commission

400 West Robinson Avenue Orlando, Florida 32801

For Respondents: Frederick J. Ramirez, Esquire Alinco Associates, 7975 Miramar Parkway

Inc., and Astin: Miramar, Florida 33023

For Respondent Roger L. Spink, Esquire Lucas: 1640 North 69th Way

Hollywood, Florida 33024

By Administrative Complaint filed January 23, 1979, the Florida Real Estate Commission (FREC), Petitioner, seeks to suspend or otherwise discipline the real estate broker's licenses of Alinco Associates, Inc., Alfred C. Couric, Jr., Carol L. Astin, and Reginald D. Lucas. As ground therefor, it is alleged that Respondents were guilty of fraud, misrepresentation, dishonest dealing, trick, scheme or device, culpable negligence or breach of trust in a business transaction by failing to disclose to the buyer in a real estate transaction the known existence of termite infestation of the property which was involved in the transaction. Charges against Frank J. Boland, an original defendant, were dismissed before this hearing.

Four witnesses were called by Petitioner, two witnesses were called by Respondents, and four exhibits were admitted into evidence. At the close of Petitioner's case, and in response to Respondents' motions for directed verdicts, Respondents Alinco Associates, Inc., Alfred C. Couric, Jr., and Carol

1. Astin were advised that the Recommended Order would recommend dismissal of charges against them for lace of any evidence of guilt on their part.

   FINDINGS OF FACT

   
   

   Alinco Associates, Inc. (Alinco) is a corporate real estate broker and was so registered with FREC at all times material herein. Alfred C. Couric, Jr., Carol L. Astin, and Reginald D. Lucas are real estate brokers and at all times material herein were so registered with FREC.

   
   

   Respondent Alinco was the listing broker for a home at 7110 Filmore Street, Hollywood, Florida, owned by Jones. In December, 1977, Mrs. Jones had a termite inspection by Orkin. The inspector reported active termite infestation in the attic and induced Mrs. Jones to sign a contract for tenting and fumigation.

   After talking to salesman Boland and his supervisor and listing broker, Respondent Lucas, Mrs. Jones commissioned a second inspection by Harry Pope, a licensed termite inspector. Pope also found active termite infestation and so advised Mrs. Jones. When told by Mrs. Jones that she had already entered into a contract with Orkin, Pope did not further pursue the matter. Respondent Lucas called Pope's office after the inspection but Pope was out and his secretary said he left no word there was active infestation. Lucas assumed from this that termites were not found. Pope never relayed his findings to anyone other than Mrs. Jones.

   
   

   Mrs. Jones rescinded the fumigation contract she had entered into with Orkin. After the Contract for Sale had been executed and a "solid" sign appeared on Jones' property the Orkin salesman revisited Mrs. Jones to inquire about the fumigation and was told she would call when ready.

   
   

   Approximately thirty days prior to closing, salesman Boland, on behalf of the purchaser, ordered an inspection by DeLeva Exterminating, Inc. Robert W. DeLeva, President of DeLeva Exterminating, Inc., inspected the residence at 7110 Filmore Street on March 8, 1977, found no evidence of active termite infestation and submitted a termite clearance report which was presented to the buyers at closing.

   
   

   Some three weeks after the closing and occupancy of the house, the purchaser Menendez was advised by the Orkin inspector that he had found evidence of termites. Menendez then called DeLeva who again inspected the premises and on this inspection found evidence of active termite infestation.

   
   

   No evidence was presented that any Respondent other than Lucas (and former Respondent Boland) as aware of the Orkin inspection and report.

   
   

   DeLeva Exterminating, Inc. is a licensed corporate termite inspector as is Orkin, but neither the Orkin inspector nor Robert DeLeva was a licensed inspector when their inspections were made. Robert DeLeva has conducted numerous termite inspections but, following this incident, limits his field of operations to fumigation for which he is licensed.

   
   

   CONCLUSIONS OF LAW

   
   

   The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of these proceedings.

   
   

   Section 475.25(1), Florida Statutes provides in part that the registration of a registrant may be suspended for a period of not to exceed two years upon a finding of facts showing that the registrant has:

   1. Been guilty of fraud, misrepresentation, concealment. . .dishonest dealing. . . or breach of trust in any business transaction. . . .

From the facts presented only one Respondent was aware that an Orkin inspector had reported active termite infestation before a contract had been executed to purchase the Jones residence, and he was aware that his Orkin inspector was anxious to sell a fumigation contract. This Respondent suggested the owner get a second opinion. After the contract to buy the Jones residence had been executed another pest control company was called on behalf of the buyer for a termite inspection. No evidence was presented that this pest control company was less qualified than others in the business, that any collusion or dishonest dealing was involved between this pest control company and any Respondent, or any other fact to discredit the termite clearance report presented at the closing.

While it is unfortunate that this latter pest control company inspector failed to find evidence of termite infestation prior to closing when such infestation actually existed, this fact is not sufficient to impute any dishonesty or concealment to any Respondent. The only Respondent who was shown to have been aware of a report of active termite infestation was Lucas and he was also aware that a second opinion, in writing, had been presented that there was no termite infestation. To find Lucas at fault for not contacting Pope personally to obtain a direct report regarding Pope's inspection would be imposing a greater duty than is required by law. To find Respondent Lucas guilty of concealment he must have a duty to the buyer to disclose all information received, whether or not reliable, that might detract from the value of the property. No such duty is owed by the broker. Further, Lucas would have to suggest the buyer pay for another inspection after the inspector ordered by Lucas' office had submitted a termite clearance report.

A sufficient number of inaccurate reports by pest control companies of termite infestation has been publicized that such infestation reports often prompt a second inspection. It has also led to the licensing of pest control companies. Although a second inspection ordered by Mrs. Jones also disclosed active termite infestation, this information was never made known to any of the Respondents. Accordingly, no evidence of concealment, misrepresentation or dishonest dealing was shown by the evidence presented.

From the foregoing it is concluded that no evidence whatsoever was presented to show Respondents Alinco, Couric, or Astin had any knowledge of any report of termite infestation of the Jones property; and the evidence presented against Respondent Lucas was insufficient to prove by a preponderance of the evidence, concealment or dishonest dealing on his part in accepting the DeLea termite clearance report as accurate, and no violation of Section 475.25(1)(c), Florida Statutes was proven. It is therefore,

RECOMMENDED that the charges against Respondents Alinco Associates, Inc., Alfred C. Couric, Jr., Carol L. Astin and Reginald D. Lucas be DISMISSED and the case closed.

ENTERED this 21st day of June, 1979, in Tallahassee, Florida.

K. N. AYERS, Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301

(904) 488-9675

COPIES FURNISHED:

John Namey, Esquire Staff Attorney

Florida Real Estate Commission

P.O. Box 1900

Orlando, Florida 32801

Frederick J. Ramirez, Esquire 7975 Miramar Parkway

Mirar, Florida 33023

Rodger L. Spink, Esquire 1640 North 69th Way Hollywood, Florida 33024

Docket for Case No: 79-000384

Orders for Case No: 79-000384