STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STATE OF FLORIDA, DEPARTMENT OF ) PROFESSIONAL REGULATION, BOARD ) OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 80-915

) (PD No. 17827 Bay County)

EVON E. BREWTON )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, James E. Bradwell, held a public hearing in this case on October 27, 1980, in Panama City, Florida.

APPEARANCES

For Petitioner: John Huskins, Esquire

Department of Professional Regulation 2009 Apalachee Parkway

Tallahassee, Florida 32301

For Respondent: J. Robert Hughes, Esquire

Barron, Redding, Boggs, Hughes and Fite Post Office Box 1638

Panama City, Florida 32401 ISSUE

The issue posed for decision herein is whether or not the Respondent, Evon

1. Brewton, unlawfully failed to deposit in a trust or escrow account earnest money deposits entrusted to him until properly disbursed in violation of Subsection 475.25(1)(i), Florida Statutes, and thereby breached a trust relationship in violation of Subsection 475.25(1)(a), Florida Statutes.

   
   

   FINDINGS OF FACT

   
   

   1. Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, the following relevant facts are found.

      
      

   2. Respondent, Evon E. Brewton, is a licensed real estate broker/salesman whose license has been in an inactive (dormant) status for approximately one year. Respondent has been a resident of Bay County since approximately 1924. On March 29, 1978, Respondent assisted Mildred C. Webber, a real estate developer, in the search of property suitable for development purposes in Bay County, Florida. Such efforts led Respondent to seek out Walter 13. West, who

      had a parcel of property in Bay County that he desired a "quick sale". To accomplish such a sale, local T.V. advertisements were used. Respondent's efforts resulted in a contract between Mildred C. Webber and Walter B. West (Seller) for the purchase and sale of the West property for a purchase price of

      $115,500.00. Mr. West, the Seller, in unequivocal terms and conditions, made clear to Respondent that he was desirous of selling the property to the first purchaser who was able to tender an acceptable cash offer. Seller West also made clear to Respondent that all offers must contain a sizeable cash deposit to secure the property and which deposit he would consider forfeited provided the transaction failed to close. These conditions were made clear to Ms. Webber by Respondent and she agreed to place a $5,000.00 deposit in the form of a check which was turned over to the Seller. Mr. West accepted Ms. Webber's offer to purchase the property described as Parcel No. 1 for the price of $115,500.00.

      The $5,000.00 deposit check tendered by Ms. Webber was signed over to the Seller and was immediately negotiated by Mr. West.

      
      

   3. Also on March 29, 1978, Respondent secured a contract from Seller West for Ms. Webber to purchase a second parcel of property for which Ms. Webber placed a $500.00 earnest money deposit to secure the offer. Although Mr. West granted Ms. Webber two extensions of time to secure funds to finance the purchase of the two parcels of property, she was unable to secure financing to close the transaction. As a result, Seller West considered Ms. Webber's deposits to be forfeited and, accordingly, he retained the deposit monies.

      
      

   4. Real estate salesmen R. B. Ballard and J. K. Watts appeared and expressed their familiarity with the West/Webber real estate transactions. Witnesses Ballard and Watts corroborated the pertinent testimony of Respondent respecting the facts that prospective purchaser Webber understood Seller West's conditions and the resulting consequences should she be unable to secure financing to purchase the property. In this regard, testimony herein indicates that Ms. Webber, a knowledgeable real estate developers has not made any demands upon Mr. West to obtain a refund of the deposit monies, nor has any litigation been instituted by her to recover such deposit monies.

      
      

      CONCLUSIONS OF LAW

      
      

   5. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this action. Section 120.57(1), Florida Statutes.

      
      

   6. The parties were duly noticed pursuant to the notice provisions of Chapter 120, Florida Statutes.

      
      

   7. The authority of the Petitioner is derived from Chapter 475, Florida Statutes.

      
      

   8. Section 475.25(1)(i), Florida Statutes (1977), requires a broker to "Immediately place upon receipt. . . deposits. . . entrusted to him by any persons dealing with him as a broker in escrow with a title company, . . or to deposit such funds in a trust or escrow account maintained by him with some bank or savings and loan association located and doing business in Florida, wherein the funds shall be kept until disbursement thereof is properly authorized. . ." This provision of law is obviously promulgated to ensure that deposit monies that are received by brokers/salesmen are safely kept in an escrow account to ensure that such monies will not be misappropriated and will be readily available until they are properly disbursed as authorized by the depositor. However, this provision appears inapplicable to the instant case in view of the

express authorization by the prospective purchaser (depositor) and the conditions set forth by the seller which were clearly conveyed to the prospective purchaser prior to her deposit of the earnest monies for the two parcels of property. Noteworthy is the fact that the prospective purchaser was a knowledgeable real estate developer who obviously considered that her failure to secure purchase financing resulted in a forfeiture of her deposit monies and, accordingly, did not institute legal proceedings or make other demands upon the seller to recover such deposit monies, nor did she appear as a witness in these proceedings. In these circumstances and in view of the corroborative testimony of witnesses Ballard and Watts to the effect that Respondent made certain to Ms. Webber that her inability to obtain financing could result in a forfeiture of her deposit monies, dispelled any basis for a conclusion that Respondent breached any trust relationship or otherwise failed to deposit earnest monies received or entrusted to him from persons acting with him in a real estate broker relationship as alleged. I shall therefore recommend that the complaint allegations he dismissed.

RECOMMENDATION

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

RECOMMENDED:

That the complaint allegations charging that Respondent violated Subsection 475.25(1)(a) and (i) Florida Statutes, be DISMISSED.

RECOMMENDED this 3rd day of December, 1980, in Tallahassee, Florida.

JAMES E. BRADWELL

Hearing Officer

Division of Administrative Hearings The Collins Building

Room 101

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 3rd day of December, 1980.

ENDNOTE

1/ Presently renumbered Chapter 475.25(1)(k), Florida Statutes (1979).

COPIES FURNISHED:

John Huskins, Esquire Department of Professional

Regulation

2600 Blair Stone Road Tallahassee, Florida 32301

J. Robert Hughes, Esquire Barron, Redding, Boggs,

Hughes and Fite Post Office Box 1638

Panama City, Florida 32401

Nancy Kelley Wittenberg, Secretary Department of Professional

Regulation

2600 Blair1 Stone Road Tallahassee, Florida 32301

Docket for Case No: 80-000915

Orders for Case No: 80-000915