STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) CASE NO. 81-2408

)

BENJAMIN C. FOSTER and ) FREDERICK ANTHONY III, INC., )

)

Respondent. )

)

RECOMMENDED ORDER

This case was heard pursuant to notice on February 3, 1982, in Fort Myers Florida, before Stephen F. Dean, assigned Hearing Officer of the Division of Administrative Hearings. This case was initiated by an Administrative Complaint filed against the Respondents by the Board of Real Estate alleging that they had violated sections 475.42(1)(c) and 475.25(1)(a), Florida Statutes. At the hearing, with Respondent Foster's agreement, the Board orally amended said complaint.

APPEARANCES

For Petitioner: Xavier J. Fernandez, Esquire

2701 Cleveland Avenue, Suite 10 Post Office Box 729

Fort Myers, Florida 33902

For Respondents: Benjamin C. Foster, pro se

5354 Emily Drive, Southwest Fort Myers, Florida 33908

Frederick Anthony III, Inc. did not appear.

Prior to commencement of the hearing, Petitioner Foster announced he was representing himself after being advised of his right to have counsel. Foster stated he did not dispute the material issues alleged in the Administrative Complaint and admitted specifically the allegations contained in Paragraphs 1, 2, 3, 5, 6, 7, 8 and 9 of the amended complaint. The parties stipulated to a hearing before the undersigned in this case.

Both parties submitted proposed findings. These proposed findings have been read and considered in the writing of this order. To the extent the proposed findings 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.

ISSUES

Did Frederick Anthony III, Inc., employ persons who were not licensed? Did Benjamin Foster have knowledge that these individuals were employed?

Was Benjamin Foster responsible for the employment of unlicensed individuals?

Was Benjamin Foster liable for Anthony John Bascone's actions as a real estate salesman?

Did Benjamin Foster violate Sections 475.42(1)(c) and 475.25(1)(a), Florida Statutes?

FINDINGS OF FACT

1. Notice of the formal hearing was given to all parties as required by the statutes and rules.

   
   

2. Benjamin C. Foster is a real estate broker holding License No. 0151634 issued by the Board of Real Estate. Frederick Anthony III, Inc. (FA III), is a Florida corporate real estate broker holding License No. 0215470 issued by the Board.

   
   

3. Foster was the active firm member of the corporation.

   
   

4. Donald McDonald and Delores McDonald were employed by FA III. While so employed, both of these persons engaged in the sale of real estate. Neither Delores McDonald nor Donald McDonald were licensed at the times in question.

   
   

5. Foster agreed to be the active firm member for FA III because Anthony John Bascone and Frederick Hall, a real estate salesman, wanted to start a brokerage firm. Bascone and Hall had business connections with whom Foster wanted to affiliate, and Foster concluded that his function as active firm member with FA III would lead to business opportunities for FA III and for Foster's other real estate business. Bascone and Hall were corporate officers of FA III and managed the day-to-day activities of the office. They hired Donald and Delores McDonald as salespersons.

   
   

6. Foster never met Delores McDonald and did not employ her. Foster met with Donald McDonald, Delores McDonald's husband, who said he was selling real estate at that time. Foster sent Donald McDonald to Bascone and Hall to be interviewed.

   
   

7. Under Foster's agreement with Bascone and Hall, they would make the initial hiring determinations for their sales personnel and Foster would process the personnel as salespersons affiliated with the company.

   
   

8. According to Foster's agreement with Bascone, Bascone would not engage in real estate sales until after he was license. Bascone was seeking a brokerage license, and it was their intent that Bascone would become the active firm member.

9. The allegations involving Bascone's acting as a real estate professional were based on a transaction which was undisclosed to Hall or Foster until after the fact. This transaction involved the payment of a commission directly to Bascone by the seller which was unreported to Foster or Hall.

   
   

10. Foster did not exercise close supervision over the activities of FA

    III.

    
    

    CONCLUSIONS OF LAW

    
    

11. The Division of Administrative Hearings has jurisdiction in this

    matter and of the parties thereto pursuant to Section 120.57(1), Florida Statutes. The Board of Real Estate has jurisdiction to discipline its licensees, Benjamin C. Foster and Frederick Anthony III, Inc., for violations of Sections 475.42(1)(c) and 475.25(1)(a), Florida Statutes (1979).

    
    

12. Section 475.42(1)(c), Florida Statutes, prohibits a broker from employing as a real estate salesman any person not holding a valid real estate license. Section 475.25(1)(a), Florida Statutes, makes any violation of Section 475.42, supra, grounds for disciplinary action.

    
    

13. Respondent Foster was the active firm member of FA III and as such was responsible for the conduct of all its business, to include employment of personnel. Although Foster did not hire the McDonalds, and their employment by Bascone and Hall was contrary to their agreement with Foster, Foster is still responsible. The active firm member must exercise sufficient supervision of the corporation's activities to insure that the corporation does not violate the statutes and rules. The activities of the McDonalds were open and capable of being observed. Had Foster seen them, he could have questioned their employment without his approval and checked their licensure status. It appears that Foster was genuinely unaware that the McDonalds were employed by FA III.

    
    

14. The conduct in which Bascone engaged was hidden and unreported to FA

    III. A broker cannot be held responsible for an employee's conduct which is purposefully hidden from the corporation.

    
    

15. Respondents are not guilty of violating Count I of the amended complaint as alleged. Respondents are guilty as alleged in Counts II and III of violations of Section 475.42 and thereby Section 475.25(1)(a), Florida Statutes. The fact that these events occurred at the end of the operations of FA III, and that Foster withdrew as active firm member thereafter, mitigates his conduct but does not excuse it.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, the Hearing Officer recommends that the license of Benjamin C. Foster be suspended for three months, and that the license of Frederick Anthony III, Inc., be revoked.

DONE and ORDERED this 3rd day of March, 1982, in Tallahassee, Leon County, Florida.

STEPHEN F. DEAN

Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 3rd day of March, 1982.

COPIES FURNISHED:

Xavier J. Fernandez, Esquire 2701 Cleveland Avenue, Suite 10 Post Office Box 729

Fort Myers, Florida 33902

Mr. Benjamin C. Foster

5354 Emily Drive, Southwest Fort Myers, Florida 33908

Frederick Anthony III, Inc. 3920 Orange Grove Boulevard North Fort Myers, Florida 33903

C. B. Stafford, Executive Director Board of Real Estate

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802

Samuel Shorstein, Secretary Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

Docket for Case No: 81-002408

Orders for Case No: 81-002408