Judges: STEPHEN F. DEAN
Agency: Department of Business and Professional Regulation
Latest Update: Jul. 29, 1982
Summary: At the beginning of the hearing, Petitioner dismissed the allegation that Respondent was in violation of Subsections 489.129(1)(a) and (f), Florida Statutes. The issues in this case are as follows: Did Respondent fail to advise the Department of his affiliation with Blanchette/Larry Allen Builders contrary to Section 489.119(3)(b), Florida Statutes? Did Respondent abandon the project contrary to Section 489.129(1)(k), Florida Statutes? Did Respondent fail to supervise construction and to assume
Summary: At the beginning of the hearing, Petitioner dismissed the allegation that Respondent was in violation of Subsections 489.129(1)(a) and (f), Florida Statutes. The issues in this case are as follows: Did Respondent fail to advise the Department of his affiliation with Blanchette/Larry Allen Builders contrary to Section 489.119(3)(b), Florida Statutes? Did Respondent abandon the project contrary to Section 489.129(1)(k), Florida Statutes? Did Respondent fail to supervise construction and to assume responsibility for the activities of the company contrary to Section 489.119(2), Florida Statutes? The parties submitted proposed findings of fact, memoranda of law and proposed recommended orders, which were considered in the writing of this order. To the extent the proposed findings of fact have not been included in the factual findings in this order, they are specifically rejected as being irrelevant, not being based upon the most credible evidence, or not being a finding of fact.Abandonment and failure to supervise were not proven. Technical violation of registration provision when registered as agent for corporate venture.
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FLORIDA CONSTRUCTION INDUSTRY ) LICENSING BOARD, DEPARTMENT ) OF PROFESSIONAL REGULATIONS, ) STATE OF FLORIDA, )
vs. ) CASE NO. 81-1610
ARTHUR N. SHANE, )
Respondent. )
This case was heard pursuant to notice on October 21, 1981, in Orlando, Florida, by Stephen F. Dean, assigned Hearing Officer of the Division of Administrative Hearings. This case was presented on an Amended Administrative Complaint filed by the Construction Industry Licensing Board against Arthur N. Shane alleging that he had violated various provisions of Chapter 489, Florida Statutes (formerly Chapter 468, Florida Statutes). The entry of this Recommended Order was delayed by the Respondent's renewed Motion to Dismiss this cause because of the Board's failure to comply with Section 120.60(6), Florida Statutes, since repealed. That portion of the transcript was requested, and this Recommended Order was entered as soon as practicable after its receipt.
For Petitioner: Michael E. Egan, Esquire
For Respondent: John W. Foster, Esquire
At the beginning of the hearing, Petitioner dismissed the allegation that Respondent was in violation of Subsections 489.129(1)(a) and (f), Florida Statutes. The issues in this case are as follows:
The parties submitted proposed findings of fact, memoranda of law and proposed recommended orders, which were considered in the writing of this order. To the extent the proposed findings of fact have not been included in the factual findings in this order, they are specifically rejected as being irrelevant, not being based upon the most credible evidence, or not being a finding of fact.
The Respondent, Arthur N. Shane, was at all times pertinent to this bearing a certified general contractor holding License No. CGC 006334 and a certified mechanical contractor holding License No. CMC 009742.
Respondent engaged directly in mechanical contracting with his son as Arthur N. Shane and Associates (ANSA) at the times in question in the Administrative Complaint. Respondent desired to engage in general contracting and in July of 1979, he advertised to solicit someone who was interested in participating in a general contracting venture.
Larry Blanchette contacted Respondent in response to his advertisement, and they began negotiations regarding a joint enterprise.
During these negotiations, Blanchette personally obtained contracts between himself and others for three separate projects. These contracts included the one with Marcelle Capewell which is specifically at issue in this case. The subject contract was executed on August 13, 1979.
On August 12, 1979, Blanchette began legal advertising of the fictitious name of a business venture, Larry Allen Builders. The publication of notice was completed on September 2, 1979. This notice reflects that Blanchette, his wife, and Arthur Shane Associates were doing business as Larry Allen Builders.
Larry Allen Builders assumed responsibility for the contracts obtained previously by Blanchette. The Respondent inspected job sites, made on-site inspections, drew plans for one house, and counseled with Blanchette on the various construction projects, providing both technical and business advice to Blanchette.
As of October 16, 1979, Respondent had become the qualifying agent for ANSA as both a mechanical contractor and a general contractor. This was the result of Respondent's request to the Board to activate his general contractor's license in the name of ANSA, to which the Board responded by its letter of said date. The Respondent did this in anticipation of ANSA's participation in the venture with the Blanchettes.
The Respondent drew the building permits on the Capewell job, inspected the job and its progress several times, and counseled with Blanchette on and off the job. ANSA carried insurance (type not stated) on the carpenter employed on the job by Blanchette.
Marcelle Capewell was aware that Respondent was involved with the remodeling project, and that a relationship existed between the Respondent and Blanchette in which Respondent exercised influence on Blanchette's work on the project. Capewell looked to the Respondent to direct Blanchette in Blanchette's work on the project.
The Capewell contract was for a major remodeling of a house which, among other things, involved conversion of a carport into a garage, complete remodeling of the kitchen and the bathrooms, and construction of a privacy or patio wall. In addition to the matters addressed in the contract, other items of work were later included by oral agreement of the parties, to include floor covering in the kitchen, wallpapering, and replacement of a rotted major structural beam discovered during demolition.
Work was commenced on the project on approximately the first of September, 1979. The contract did not state a date for completion; however, by October 8, 1979, Capewell was demanding that the work be completed by October 15, 1979. Her demand was unrealistic based upon the amount of work to be done, the changes in the contract, and the dispute over responsibility for replacing the rotted beam.
When she became dissatisfied with the progress, Capewell contacted the Respondent. Respondent became directly involved in the resolution of the conflict, persuading Capewell to extend the date of completion until November 1, 1979.
After Capewell's agreement to the extension of time, her attorney gave notice of default on the contract on October 18, 1979, directing Blanchette to refrain from further work. The grounds for the notice of default had no relationship to the completion schedule but were specifically based upon the failure of Blanchette to pay for kitchen cabinets. It was not established why payment for these cabinets was critical to the completion of the project or otherwise a basis for default.
The contract was declared in default and Blanchette ejected from the job without cause.
It took Capewell three months to have the project completed after she had arranged for its completion by another builder.
There followed a series of communications, both personal and in writing, between Respondent, Capewell and her attorney. The essential facts contained in these communications as evidenced by the letters, Joint Exhibit #3, are as follows:
Capewell held Respondent responsible for the project;
Respondent met with Capewell and her attorney to arrive at mutually acceptable terms for completing the job;
Through her attorney, Capewell represented that all money involved in the original contract had been expended;
Respondent was asked to pay $4,000 to have the project completed but was not asked to complete it; and
Respondent refused to go back on the job under these conditions.
At the time Capewell's attorney advised Respondent that all the money had been expended, Capewell still retained more than $4,600 of the contract price. This fact was not communicated to the Respondent.
The Respondent and ANSA did not abandon the Capewell job without cause.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction in this matter and of the parties thereto pursuant to Section 120.57(1), Florida Statutes.
The allegations that Respondent had violated Subsections 489.129(1)(e) and (f), Florida Statutes, were dismissed by the Petitioner at the hearing.
The Board alleges that Respondent failed to comply with Sections 489.119(2) and 489.105(3), Florida Statutes, and therefore violated Section 489.129(1)(j), Florida Statutes, because Respondent did not supervise construction and assume responsibility for the activities of the company contrary to Section 489.119(2), supra. Factually, the record shows that Respondent did supervise Blanchette and assumed responsibility for the contract. The Board has failed to prove a violation of Sections 489.119(2) and 489.105(3), Florida Statutes.
The Respondent is alleged to have abandoned the project contrary to Section 489.129(1)(k), Florida Statutes. The facts reveal that the contract between Capewell and Blanchette, which was assumed by Larry Allen Builders, did not state a date of completion. In the absence of a specified date, a reasonable date must be implied. The work to be done was a major remodeling. Construction was begun timely at approximately the beginning of September, 1979. Capewell made additional requests not covered in the contract. A major structural beam was discovered to be rotten and required additional work to repair. A dispute arose concerning responsibility for this added work. By October 8, 1979, Capewell was complaining of delay and demanding completion of the work by October 15, 1979.
Not to complete a major remodeling project in six to seven weeks does not appear to be unreasonable. It took Capewell three months to have the project completed after she took responsibility for it.
On October 15, 1979, Capewell gave notice of default on the contract after agreeing with Respondent to extend the deadline for completion to November 1, 1979. Notice of default was purportedly because of delay; however, the specific event stated as grounds for the default was Capewell's attorney being advised that kitchen cabinets had not been paid for. Default based upon the failure to pay for cabinets was not consistent with the terms of the contract or the agreement reached with Respondent to extend the deadline for completion to November 1, 1979.
After directing Blanchette to cease work, Capewell then advised Respondent that she held him responsible for her damages. Negotiations ensued between the Respondent, Capewell and her attorney for a satisfactory completion of the project. Respondent was asked to pay Capewell $4,000 to have the job completed. He was advised that all money on the contract had been paid out, when in fact Capewell held more than $4,600 due on the contract. Had Respondent been asked to complete the job, the purposeful misrepresentation that all the money had been disbursed would have relieved the Respondent of the obligation.
In summary regarding these allegations, the facts show that Capewell improperly and unreasonably terminated the contract, did not ask or permit the Respondent to complete the contract, and misrepresented to Respondent that there were no funds still due on the contract with which he could have attempted completion. There was no abandonment by Blanchette or Respondent. The Respondent is not in violation of Section 489.129(1)(k), Florida Statutes.
The Board alleges that Respondent failed to advise the Department of Professional Regulation of his affiliation with Blanchette/Larry Allen Builders contrary to Section 489.119(3)(b) Florida Statutes. This section requires that a qualifying agent who was qualifying one business entity advise the Board if he seeks to engage in business as an individual or as qualifying agent for any other business entity.
The facts show that on August 19, 1979, Respondent agreed to enter into a venture with Blanchette and his wife to engage in mechanical and general contracting. Respondent testified it was his intent for Arthur N. Shane and Associates to engage in this venture with the Blanchettes. At approximately the same time, public notice was published of the intent of the Blanchettes and ANSA to engage in business under the fictitious name of Larry Allen Builders.
Also at about this time, Respondent apparently initiated the process to activate his general contractor's license in the name of ANSA, a business entity for which he was already the qualifying agent for engaging in mechanical contracting. This request resulted in the Board's letter of October 16, 1979, granting ANSA a general contractor's license. According to the Respondent, he did this to comply with his reading of Section 489.119, Florida Statutes, because it was his opinion that ANSA was the organization engaging in contracting and not himself as an individual.
Given the Respondent's status as qualifying agent for ANSA as a mechanical contractor, and his personal inactive general contractor's certificate, a real question exists whether he would have had to comply with Section 489.119(2) or with Section 489.119 (3), Florida Statutes. If the provisions of Section 489.119(3) are not applicable to qualifying agents in one field of contracting seeking to qualify a business or themselves in a different field, then a person in Respondent's position would be governed by Subsection
(1) or (2). If the provisions of Section 489.119(3) are applicable to a qualifying agent attempting to engage in any other field of contracting in which the qualifying agent is certified, then the qualifying agent would be governed by Subsection (3). The parties have not cited any rule amplifying the Board's policy in this regard; however, by charging a violation of Section 489.119(3)(b), Florida Statutes, the Board has indicated that its policy would require a qualifying agent in one field to comply with the cited provision if the qualifying agent were to engage in business or affiliate in that field or any other field. Therefore, whether Respondent or ANSA was the affiliating party, a new business entity was created requiring compliance with Section 489.119(3), Florida Statutes.
The Respondent should have qualified Larry Allen Builders pursuant to Subsection (3)(b), supra, and Larry Allen Builders should have applied for licensure as provided in Subsection (2). However, Respondent's initiation of registration as agent for ANSA indicates that Respondent's violation of Subsection (3)(b), supra, was not an intentional effort to avoid the provisions of Section 489.119, Florida Statutes.
The Respondent argues that the alleged violation was not a material violation as required by Section 489.129(1)(j), Florida Statutes. The failure to properly register is a material violation; however, the failure of the Respondent to properly register under Section 489.119(3)(b), Florida Statutes, is mitigated by the Respondent's activation of his general contractor's license in ANSA, which he viewed as the participant with Larry Allen Builders. There is no substantial evidence of an intent to avoid the registration provisions.
(f) and (k), and 489.105(3), Florida Statutes, the Hearing Officer recommends that no action be taken by the Board on those allegations.
Having found that the Respondent violated Section 489.129(3)(b), Florida Statutes, the Hearing Officer recommends that the Board give Respondent an official reprimand.
DONE and ORDERED this 15th day of March, 1982, in Tallahassee, Leon County, Florida.
STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings The Oakland Building
Filed with the Clerk of the Division of Administrative Hearings this 15th day of March, 1982.
Michael E. Egan, Esquire
John W. Foster, Esquire Suite 850, CNA Tower Orlando, Florida 32802
J. K. Linnan, Executive Director Construction Industry Licensing Board
