n

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) CASE NO. 81-2480

) SAV-ON RENTALS, INC. and CARL ) STUART COURTNEY, )

)

Respondent. )

)

RECOMMENDED ORDER

This case was heard pursuant to notice on January 28, 1982, in Orlando, Florida, before Stephen F. Dean, assigned Hearing Officer of the Division of Administrative Hearings. This case was initiated by an Administrative Complaint filed upon Sav-On Rentals, Inc., and Carl Stuart Courtney by the Board of Real Estate alleging that the Respondents had violated Section 475.25(1)(b), (c), (d) and (h) and Section 475.453(1), Florida Statutes.

APPEARANCES

For Petitioner: Salvatore A. Carpino, Esquire

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

For Respondents: Ronald W. Brooks, Esquire

338-D North Magnolia Avenue Orlando, Florida 32801

ISSUES

There were originally three counts in the Administrative Complaint. Count II was dismissed by the Petitioner Board at the beginning of the hearing. Count I alleges that the Respondents failed to refund a fee as required by the contract and the statutes; and Count III alleges that Respondents employed unlicensed persons as sales personnel.

Based upon the stipulation of the parties, the primary issue in Count I was whether the Respondents refused the refund in bad faith or under color of some right to the fee. The issue in Count III was whether the activities engaged in by the unlicensed persons were regulated activities.

FINDINGS OF FACT

Count I

1. Sav-On Rentals, Inc. (Sav-On), is a licensed corporate real estate broker located in Orlando, Florida, holding License #211231. Carl Stuart Courtney is the active broker for Sav-On and holds Licenses #0211232 and #0017643. Both Respondents were licensed at all times pertinent to the allegations in the Administrative Complaint.

   
   

2. Susan Young and A. J. Stephens went to Sav-On on July 18, 1980, seeking information on renting a house. They executed a contract with Sav-On, paid the required $40 fee, and were given data on houses for rent.

   
   

3. The contract contains the following pertinent language:

   
   

   . . .Notice: Pursuant to Florida Law: If the rental information provided under this contract is not current or accurate in any material aspect, you may demand within 30 days of this contract date a return of your full fee paid. If you do not obtain rental information you are entitled to receive a return of 75 percent of the fee paid, if you make demand within 30 days of this contract date. . .

   
   

4. That night Young and Stephens changed their minds about renting a house. The next day they called Sav-On and requested a refund of their fee.

   
   

5. Young rented an apartment from an apartment complex.

   
   

6. On August 14, 1980, Stephens prepared the written refund request at Sav-On.

   
   

7. Sav-On had a listing for the sublease of an apartment in the same complex in which Young rented her apartment. There is no evidence that Sav-On gave Young or Stephens any information on that sublease, or that Young rented her apartment based on her contact with Sav-On.

   
   

8. Sav-On denied the refund on the basis that Young had leased a property available through Sav-On.

   
   

9. As of the date of the hearing, Young and Stephens had not received a refund.

   
   

   Count II

   
   

10. Christopher LaFrance, a licensed real estate salesman, was one of the first licensees hired by Sav-On Rentals, Inc., after its incorporation in July of 1979. He was employed until January, 1980.

    
    

11. When LaFrance was first hired, there were several unlicensed clinical staff employed by Sav-On. These employees were holdovers from Sav-On's non- licensed business.

    
    

12. One of the unlicensed persons, Dawn (last name not stated), was responsible for telephone service to persons already registered. She provided additional listings to persons already registered with Sav-On.

13. Another of the unlicensed persons was Stephanie (last name not stated), who was a verifier. She called listings to determine if they were unrented and still available.

    
    

14. Stephanie and Dawn were not licensed at the times in question.

    
    

15. Between July of 1979, and January, 1980, these unlicensed personnel were gradually replaced by licensed persons.

    
    

    CONCLUSIONS OF LAW

    
    

16. The Division of Administrative Hearings has jurisdiction to hear this cause and enter this Recommended Order pursuant to Section 120.57(1), Florida Statutes. The Board of Real Estate has jurisdiction to discipline the Respondents, who are its licensees, pursuant to Chapter 475, Florida Statutes.

    
    

17. In Count I of the Administrative Complaint, the Board alleges that by failing to give Young and Stephens a refund the Respondents violated Section 475.25(1)(b) and (d), and Section 475.453(1), Florida Statutes. The facts do not sustain a finding that Respondents were engaged in any fraudulent or false conduct contrary to Section 475.25(1)(b), Florida Statutes. The facts do not sustain a finding that Respondents failed to include in their contract the language required by Section 475.453(1), Florida Statutes.

    
    

18. Clearly, Sav-On refused Young and Stephens a refund to which, under the contract they executed and the applicable statutes, they were entitled. Young and Stephens were entitled to a minimum of 75 percent of their $40 fee. They made a timely request and were improperly denied.

    
    

19. In mitigation, it appears that this denial was initially made in error. After being contacted by the Department's investigator at the time the refund was denied, Sav-On did not make a refund at that time because of the Respondents' fear that making the refund would be an admission of wrongdoing. Therefore, what was a technical and unintentional violation was compounded into a full-blown administrative case. However, Respondents have violated Section 475.25(1)(d), Florida Statutes, by failing to make the refund.

    
    

20. In Count III, the Board charges the Respondents with employing unlicensed personnel as real estate salespersons contrary to Section 475.42, Florida Statutes, and sharing commissions with or paying compensation to unlicensed persons who were performing services set out in Section 475.01(3), Florida Statutes, contrary to Sections 475.25(1)(c) and (h), Florida Statutes.

    
    

21. This allegation is based specifically on the alleged activities of Dawn and Stephanie. The facts reveal that Stephanie verified listings to insure they were accurate. The facts reveal that Dawn gave out additional listings from computer-based data to persons who had subscribed to the services of Sav- On.

    
    

22. Section 475.01(3), Florida Statutes, lists the licensed activities of a broker or salesman. These activities do not include those in which Dawn or Stephanie were engaged. While the operation of a service of the type engaged in by Sav-On is encompassed by Section 475.01(3), Florida Statutes, the activities in which Dawn and Stephanie engaged are not such activities. These activities did not involve any special expertise or knowledge of real estate. Therefore, the Respondents are not guilty of violation of Section 475.25(1)(h), Florida Statutes.

23. There is no evidence of any false advertising contrary to Section 475.25(1)(c), Florida Statutes.

    
    

24. The Board has alleged a violation of Section 475.42, Florida Statutes. The Board is without jurisdiction to prosecute under Section 475.42, supra, which is a criminal statute. The Board failed to allege any violation under Section 475.24, Florida Statutes, which would establish its jurisdiction.

    
    

25. The facts reveal that the Respondent, Courtney, has improved the operation of the Respondent business, Sav-On, and has exercised the requisite degree of control; however, Sav-On is a closely-held family business. Courtney is not a family member with whom daily operation rests. On this basis, the recommendation which follows differs with regard to the Respondents.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, and considering the facts in mitigation, the Hearing Officer recommends that the Respondent, Carl Stuart Courtney, receive a letter of reprimand for violation of Section 475.25(1)(d), Florida Statutes; and that the Respondent, Sav-On Rentals, Inc., be placed on probation for a period of six months for the violation of Section 475.25(1)(d), Florida Statutes.

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

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 15th day of March, 1982.

COPIES FURNISHED:

Salvatore A. Carpino, Esquire Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

Ronald W. Brooks, Esquire 338-D North Magnolia Avenue Orlando, Florida 32801

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: 81-002480

Orders for Case No: 81-002480