STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DIVISION OF HOTELS AND )

RESTAURANTS, DEPARTMENT OF )

BUSINESS REGULATION, )

)

Petitioner, )

)

vs. ) CASE NO. 79-1625

) H & R No. 23-1935H-3778 GLYN G. DEAN and GRADY WILSON )

t/a ELEGANTE APARTMENTS, )

)

Respondents. )

)

RECOMMENDED ORDER

A hearing was held in the above captioned matter, after due notice, on October 17, 1979, at Miami, Florida, before Thomas C. Oldham, Hearing Officer.

APPEARANCES

For Petitioner: Dan Brown, Esquire

Staff Attorney

Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301

For Respondents: Glyn G. Dean

1040 Northeast 78th Road Miami, Florida 33138

ISSUE

Whether Respondent's license under Chapter 509, Florida Statutes, should be suspended or revoked, or a civil penalty imposed for alleged violation of Section 83.49(2) and (3) , Florida Statutes, as set forth in Notice to Show Cause.

Respondent Glyn G. Dean appeared at the hearing unaccompanied by legal counsel and he was thereafter advised of his rights as a respondent in an administrative proceeding. He indicated that he understood such rights and desired to represent himself at the hearing.

FINDINGS OF FACT

1. Respondent Glyn G. Dean owns and operates the Elegante Apartments, a five-unit apartment building located at 1040 NE 78th Road, Miami, Florida. Respondent holds a license issued by Petitioner to operate a public lodging establishment pursuant to the provisions of Chapter 509, Florida Statutes. (Testimony of Dean, Teller)

2. On January 28, 1978, Respondent rented Apartment 2 to George Tulloch and his wife on a weekly basis. Thereafter on April 1, 1978, Respondent and Tulloch entered into a lease of the apartment for a period of one year at a rental of $275 per month, including $25 a month as a "damage deposit." The lease provided that the lessee would pay for the cost of repairing all damage to the apartment caused by himself or his family and the cost of removing foreign substances from toilets and sinks. At no time did Respondent inform the lessee as to the manner in which he would hold the payments representing security deposits. Payments in the amount of $275 were made by Tulloch each month from April through October 1978. Thereafter, Tulloch paid as follows:

   
   

   November 30, 1978 -	$250.00
   December 8, 1978 -	80.00
   December 24, 1978 -	50.00
   January 23, 1979 -	170.00
   February 19, 1979 -	75.00
   March 10, 1979 -	100.00

   
   

   (Testimony of B. Tulloch, Respondent, Respondent's Exhibits 1-2, Petitioner's Exhibit 1)

   
   

3. In October 1978, there was a ceiling leak in the apartment which caused a bedroom and kitchen to sustain water damage. A section of the kitchen ceiling also fell and struck Mr. Tulloch who later instituted a claim against Respondent under the latter's insurance policy. (Testimony of Tulloch, Dean, supplemented by Respondent's Exhibit 4)

   
   

4. The lessee vacated the apartment at the expiration of the lease on March 31, 1979. At that time, he did not provide Respondent with a forwarding address and it was not until late May that Respondent learned of the same. He thereafter sent a certified letter of his intention to make claim against the security deposit which was received by the lessee on May 28, 1979. He sent a further letter of June 22, 1979, which listed various costs for cleaning and damage to the apartment and reflected that after application of a total of $175 representing deposit payments made during the course of the year, Respondent was due $153 from Tulloch. After termination of the lease, she tenant paid Respondent $650 representing back rent due under the lease. Mrs. Tulloch denied at the hearing that she and her husband had caused any damage to the apartment. (Testimony of Dean, B. Tulloch, Petitioner's Exhibits 3-4, Respondent's Exhibit 3)

   
   

   CONCLUSIONS OF LAW

   
   

5. Petitioner seeks to take disciplinary action against Respondent's public lodging establishment license for alleged violations of Section 83.49(2) and (3), Florida Statutes, which concerns the handling of security deposits by landlords. Section 83.49(7) provides that anyone licensed under the provisions of Section 509.241 as a public lodging establishment who fails to comply with such deposit requirements shall be subject to disciplinary action by Petitioner with regard to his license.

   
   

6. Petitioner claims that Respondent violated Section 83.49 as follows:

   
   

   1. Pursuant to Florida Statute 83.49(3), Franklin Tulloch failed to get refund of his security of $225 and failed to receive a certified letter within fifteen days of ter-

      mination of his rental agreement making claim against this deposit.

      
      

   2. 83.49(2) Tenant failed to receive a written notice telling where and how security deposit of $225 is being held and is due interest on this deposit for one year.

      
      

7. Section 83.49(2) provides that a landlord of five or more individual dwelling units who requires a security deposit which is held in excess of six months must notify the tenant in writing within thirty days of receipt of such a deposit as to the manner in which he is holding the deposit, the rate of interest, if any, which the tenant is to receive, and the time of interest payments to the tenant. The statute further provides that if the landlord maintains the money in a separate account for the benefit of tenants, no interest need be paid. However, if the landlord commingles such funds with his own, he must pay five percent interest per annum on the same or, if placed in a banking institution, the tenant is entitled to at least seventy-five percent of the interest payable on such account in lieu of the five percent interest payment. In this case, Respondent received the sum of $25 per month as a damage or security deposit, some of which was retained for a period in excess or six months. However, he did not provide the tenant with the required notice stating the manner in which such funds were being held, as required by the statute. Accordingly, it is considered that Respondent violated that statutory requirement. The fact that the deposit was not received in a lump sum at the beginning of the lease and that full rent was not paid each month by the tenant is immaterial to the requirement of written notice under the statute.

   
   

8. Section 83.49(3)(a) provides that when the tenant vacates the premises upon termination of the lease, the landlord shall have fifteen days to return any security deposit together with interest or in which to give the tenant written notice by certified mail to the tenant's last known mailing address of his intention to impose a claim thereon. If he fails to give the required notice within the specified period, he forfeits his right to impose a claim on the security deposit. In the instant case, the evidence establishes that the tenant failed to provide Respondent with a forwarding address until sometime in late May, 1979. The tenant's complaint filed with Petitioner acknowledges that he received the landlord's written claim for damages by certified mail on May 28, 1979. Although the letter of notice was not submitted in evidence at the hearing, it is concluded that the tenant's admission of receipt is sufficient to show compliance by Respondent with the statutory notice provisions. It is therefore concluded that Respondent is not in violation of Chapter 83 in this respect.

   
   

9. Under the entire circumstances herein, it is considered that an administrative fine of $100 should be imposed against Respondent for the established violation of Section 83.49(2), F.S.

RECOMMENDATION

That Petitioner impose an administrative fine of $100 against Respondent Glyn G. Dean pursuant to Sections 83.49(7) and 509.261(2), Florida Statutes, for violation of Section 83.49(2), Florida Statutes.

DONE and ENTERED this 13th day of November, 1979, in Tallahassee, Florida.

THOMAS C. OLDHAM

Hearing Officer

Division of Administrative Hearings

101 Collins Building Tallahassee, Florida 32301 (904) 488-9675

COPIES FURNISHED:

Dan Brown, Esquire Staff Attorney

Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301

Glyn G. Dean

1040 NE 78th Road Miami, Florida 33138

================================================================= AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA DEPARTMENT OF BUSINESS REGULATIONS

DIVISIONS OF HOTELS AND RESTAURANTS

DIVISION OF HOTELS & RESTAURANTS, DEPARTMENT OF BUSINESS REGULATION,

Petitioner,

vs. CASE NO. 79-1625

H & R No. 23-1935H-3778

GLYN G. DEAN AND GRADY WILSON t/a ELEGANTE APARTMENTS,

Respondent.

/

FINAL ORDER

A hearing was held in the above-captioned matter, after due notice, on October 17, 1979, at Miami, Florida before Thomas C. Oldham, Hearing Officer. Respondent Glyn G. Dean appeared at the hearing unaccompanied by legal counsel and he was thereafter advised of his rights as respondent in. the administrative

Proceeding. He indicated that he understood such rights and desired to represent himself at the tearing.

The issuance in this matter is whether the respondent's license, issued under Chapter 509, Florida Statutes, should be suspended or revoked, or a civil penalty imposed for alleged violations of Section 83.49(2), (3), Florida Statutes, as set forth in the Notice to Show Cause.

The hearing officer entered his Recommended Order in this matter on November 13, 1979. Upon review and consideration thereof, this agency takes the following final action in this matter:

FINDINGS OF FACT

1. Respondent Glyn C. Dean owns and operates the Elegante Apartments, a five unit apartment building located at 1040 N.E. 78th Road, Miami, Florida. Respondent holds a license issued by this agency to operate a public lodging establishment pursuant to the Chapter 509, Florida Statutes.

   
   

2. On January 28, 1978, respondent rented an apartment in that complex to George Tulloch and his wife on a weekly basis. Thereafter on April 1, 1978, the respondent and Tulloch entered into a lease of the apartment for a period of one year at a rental of $275.00 per month, including a $25 per month charge as a "damage deposit." The lease provided that the lessee would pay for the cost of rePairing all damage to the apartment caused by himself or his family and the cost of removing foreign substances from toilets and sinks. At no time did the respondent inform the lessee as to the manner in which he would hold the payments representing the security deposits. Payments in the amount of $275 were made by Tulloch each month from April through October, 1978. Thereafter Tulloch paid as follows:

   
   

   November 30, 1978 - $250.00; December 8, 1978 - $80.00;

   December 24, 1978 - $50.00; January 23, 1979 - $170.00;

   February 19, 1979 - $75.00; March 10, 1979 - $100.00.

   
   

3. In October, 1978, there was a ceiling leak in the apartment leased to Tulloch which caused a bedroom and the kitchen to sustain water damage. A section of the kitchen ceiling fell and struck Mr. Tulloch, who later instituted a claim against respondent under respondent's insurance policy.

   
   

4. The lessee vacated the apartment at the expiration of the lease on March 31, 1979. At that time he did not provide the respondent with a forwarding address and it was not until late May, 1979 that Tulloch informed respondent of the same. Respondent thereafter sent a certified letter stating his intention to make claim against the security deposit, which letter was received by the lessee on May 28,, 1979. Respondent sent a further letter of June 22, 1979, which listed various costs for cleaning and damage to the apartment and reflected that after application of a total of $175.00, representing deposit payments made during the course of the year, respondent was due $153.00 from the lessee, Tulloch. After termination of the lease, the tenant paid respondent $650.00 representing back rent due under the lease. Mrs. Tulloch denied at the hearing that she or her husband had caused any damage to the apartment.

CONCLUSIONS OF LAW

1. This agency has proposed to take disciplinary action against the respondent's public lodging establishment license for violations of Section 83.49(2),(3), Florida Statutes, which concerns the handling of security deposits by landlords. Section 83.49(7), Florida Statutes provided that anyone licensed under the provisions of Section 509.241, Florida Statutes, as a public lodging establishment, and who fails to comply with such deposit requirements shall be subject to disciplinary actions by this agency with regard to his license.

   
   

2. The Notice to Show Cause in this matter asserted that respondent violated Section 83.49, Florida Statutes as follows

   
   

   1. Pursuant to Florida Statutes, Section 83.49(3), it was alleged that George Tulloch failed to receive a refund of his security deposit and failed to receive a certified letter within fifteen days of termination of his rental agreement making claim against this deposit.

      
      

   2. That George Tulloch failed to receive a written notice informing him of where and how his security deposit was being held as required by Section 83.49(2), Florida Statutes.

      
      

3. Section 83.49(2), Florida Statutes, provides that a landlord of five or more individual dwelling units who requires a security deposit which is held in excess of six months must notify the tenant in writing within thirty days of receipt of such a deposit as to the manner in which he is holding the deposit, the rate of interest, if any, which the tenant is entitled to receive, and the time of interest payments to the tenant. The statute further provides that if the landlord maintains the money in a separate account for the benefit of the tenants, no interest need be paid. However, if the landlord commingles such funds with his own, he must pay 5 percent interest per annum on the same or, if placed in a banking institution, the tenant is entitled to at least 75 percent of the interest payable on such account in lieu of the 5 percent interest payment. In this case, respondent received the sum of $25 per month as a damage or security deposit, some of which was retained for a period in excess of six months. However, respondent did not provide to the tenant the required notice stating the manner in which such funds were being held as required by statute. Accordingly, respondent violated that statutory requirement. The fact that the deposit was not received in a lump sum at the beginning of the lease and that full rent was not paid each month by the tenant is immaterial to the requirement of written notice under the statute.

   
   

4. Section 83.49(3)(a), Florida Statutes, provides that when the tenant vacates the premises upon termination of the lease, the landlord shall have 15 days to return any security deposit together with interest or in which to give the tenant written notice by certified mail to the tenant's last known mailing address of his intention to impose a claim thereon. Failure to give the required notice within the specified period results in forfeiture of the landlord's right to impose a claim upon the security deposit. In the instant case, the evidence establishes that the tenant failed to provide respondent with a forwarding address until sometime in late May, 1979. The tenant's complaint filed with the petitioner acknowledges that he received the landlord's written claim for damages by certified mail on May 28, 1979. Although the letter of notice was not submitted in evidence at the hearing, it is concluded that the tenant's admission of receipt is sufficient to show compliance by respondent which is the statutory requirement. It is therefore concluded that respondent is not in violation of Chapter 83, Florida Statutes in this respect.

5. The hearing officer has recommended the imposition of an administrative fine of $100.00 against the respondent for the violation found herein to exist. Upon review of the circumstances of this case, it is the undersigned's conclusion that the hearing officer's recommendation be modified and that the administrative fine be reduced to $25.00.

Accordingly, it is hereby ORDERED:

That the respondent Glyn G. Dean, pay an administrative fine in the amount of $25.00.

That said fine shall be paid within 45 days of the date of entry of this order.

DONE AND ENTERED this 25th day of January, 1980 in Tallahassee, Florida.

ANTHONY NINOS

Director

Division of Hotels and Restaurants Johns Building

725 South Bronough Street Tallahassee, Florida 32301

COPIES FURNISHED:

Dan C. Brown, Esquire Deputy General Counsel

Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301

Glyn G. Dean

1040 NE 78th Road Miami, Florida 33138

Docket for Case No: 79-001625

Orders for Case No: 79-001625