Majerski and Majerski & Co., Inc., with having violated Subsection 475.25(1)(d) Florida Statutes. Specifically, it is charged that a salesman for Respondents procured an offer to purchase and contract for sale of certain property in Sarasota County; that the offer was subsequently withdrawn by the buyer; that the salesman then terminated his employment with Respondents; that after further negotiation, an offer, substantially the same, was made by the buyer and accepted by the seller; that the salesman then unsuccessfully demanded payment of a portion of the commission on the sale of the property from Respondents; and that by reason of failing to pay the salesman a part of the commission, Respondents were guilty of failure to account and deliver a share of a real estate commission to a person entitled to said accounting and delivery in violation of Subsection 475.25(1)(d), supra.
Respondents disputed the allegations and requested a formal hearing pursuant to Subsection 120.57(1), Florida Statutes, to contest the charges. The matter was referred by Petitioner to the Division of Administrative Hearings on November 5, 1981, with a request that a Hearing Officer be assigned to conduct a hearing. By notice of hearing dated March 11, 1982, a final hearing was scheduled for May 13, 1982, in Sarasota, Florida.
At the final hearing, Petitioner presented the testimony of James J. Majerski, Frank F. Fischera and James G. Murphy and offered Petitioner's Exhibits 1, 3 and 4, each of which was received into evidence. 1/ Respondents offered Respondents' Exhibits 1 and 2, both of which were received into evidence.
The transcript of hearing was filed on June 3, 1982. The parties were given an opportunity to file proposed findings of fact and conclusions of law; however, none were filed.
The issue herein is whether Respondents violated Subsection 475.25(1)(d) by failing to account and deliver a share of a real estate commission to a person entitled to receive the same.
Based upon all the evidence, the following findings of fact are determined: FINDINGS OF FACT
At all times relevant thereto, Respondents, James J. Majerski and Majerski and Co., Inc., held real estate license numbers 0054892 and 00054898, respectively, issued by Petitioner, Department of Professional Regulation, Florida Real Estate Commission. Mr. Majerski is the active broker of Majerski and Co., Inc., with offices located at 424 South Washington Boulevard, Sarasota, Florida.
In early 1980, Majerski attended a local real estate club meeting and was asked by a representative of a Venice, Florida Real estate firm if he had any source of investors for a condominium project in Venice that was threatened by foreclosure proceedings. Majerski invited the Venice realtor and one of the sellers to his office to discuss the plans. Majerski suggested that James G. Murphy, a friend of one of his salesman, might be interested and asked that the salesman, Frank F. Fischera, contact Murphy. Fischera and Murphy had known each other several years, and it was Fischera who had introduced Murphy to Majerski. After reviewing the plans and inspecting the property with Majerski and Fischera, Murphy presented an offer to purchase the property. This offer was rejected by the sellers. A second contract dated March 4, 1980, was prepared and submitted in which Murphy agreed to buy the property for $500,000. In conjunction with this offer, Murphy gave Majerski a $5,000 deposit which was held in escrow pending acceptance of the offer. The offer was eventually rejected by the sellers and the deposit returned.
On May 13, 1980, Fischera terminated employment with Majerski and Co., Inc. When he left, there was no signed contract or offer pending on the Murphy transaction. The evidence is conflicting as to what, if any, arrangements were agreed upon by Majerski and Fischera concerning transactions or deals that Fischera was still working on. However, it is found that no written agreement was entered into whereby Fischera would received a commission for any transaction that he continued working on after he left the office.
On May 14, 1980, Majerski wrote Fischera a letter in which he told him, in part, that:
We wish to remind you that under Florida real estate law all listings and customers and transactions in progress at the time you were with the broker of record remain the property of the broker of record.
Since there are no firm deals, signed on both sides and with finalized negotiations in writing complete, currently existing at the time of your departure from the under- signed broker, their (sic) are no fees in expectancy due you at the time of your departure from our association.
Several offers were subsequently submitted by Murphy through Majerski attempting to buy the property. In all, approximately six or seven contracts were executed before a sale was consummated. An offer was finally accepted and a closing held on the property on or about July 24, 1980. Under the terms of the last contract, the broker in Venice held the escrow deposit pending completion of the sale. The sales price was the same as that offered on previous contracts but several ambiguous points in the contract that Murphy had previously objected to were now "clarified'. Respondents received a commission totaling approximately $17,500.
Although Fischera was no longer employed by Majerski after May 13, 1980, he continued to monitor the negotiations on the transaction through his friend, Murphy. However, there is no evidence he actively participated in the transaction after he left Majerski.
Fischera later made several demands for Majerski for a portion of the commission earned on the sale. He later instituted an action in circuit court to recover a share of the commission. That suit is still pending. He also filed a complaint with Petitioner which precipitated the instant case.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction of the subject matter and the parties thereto pursuant to Subsection 120.57(1), Florida Statutes.
Subsection 475.25(1)(d), Florida Statutes, makes unlawful the following acts:
Failed to account or deliver to any person, including a licensee under this chapter, at the time which has been agreed upon or is required by law or,
in the absence of a fixed time, upon demand of the person entitled to such accounting and delivery, any personal property such
as money, fund, deposit, check, draft, abstract of title, mortgage, conveyance, lease, or other document or thing of value, including a share of a real estate commis-
sion, or any secret or illegal profit, or any divisible share or portion thereof, which has come into his hands and which is not his property or which he is not in law or equity entitled to retain under the circumstances. However, if the licensee, in good faith, entertains doubt as to what person is entitled to the accounting and - delivery of the escrowed property, or if conflicting demands have been made upon him for the escrowed property, which prop- erty he still maintains in his escrow or trust account, the licensee shall promptly notify the board of such doubts and shall promptly:
Request that the board issue an escrow disbursement order determining who is entitled to the escrowed property; or
With the consent of all parties, submit the matter to arbitration; or
By interpleader or otherwise, seek adjudication of the matter by a court.
If the licensee promptly employs one of the escape procedures contained herein, and if he abides by the order or judgment resulting therefrom, no administrative
complaint may be filed against the licensee for failure to account for, deliver, or maintain the escrowed property;. . .
It is alleged that Frank E. Fischera ". . .was the procuring cause of an offer to purchase and contract for sale entered into. . ." between the parties in March, 1980, and that ". . . an offer substantially the same as the earlier offer, was made by buyer. . .and accepted by sellers. . ." at a date after Fischera terminated employment with Respondents. Accordingly, petitioner contends that Fischera is entitled to a share of the commission received by Respondents, and their failure to pay the same to Fischera constitutes a violation of the foregoing statute.
By way of oral argument, Respondents have asserted that no basis for a violation exists for a number of reasons. First, they contend that Subsection 475.25(1)(d) expressly requires that a deposit be escrowed in order for its provisions to be triggered. Because none were held by Respondents on the consummated contract, the statute has no application. Second, they assert that a realtor is not obligated to pay a commission to a person not registered with the firm, and that, indeed, the law prohibits this. Finally, they contend the dispute is contractual in nature, and a matter that must be adjudicated in circuit court.
Respondents' first contention that escrowed property must be held by a broker in order for the provisions of Subsection 475.25(1)(d) to be invoked is rejected. If this premise were true, a broker could avoid responsibility for paying a commission by simply having another party hold the deposit, or by providing that none be made. Such a result would defeat the purpose of the law.
Respondents next contend that because the salesman was not registered with their firm when the sale was consummated, there was no corresponding obligation to share a commission. Although not cited by Respondents, this contention rests upon a proper construction of Sections 475.25(1)(h) and 475.41, Florida Statutes. Generally, these sections provide that a commission need not be paid unless a salesman has complied with all provisions of the act, including the requirement that he be "properly licensed". The argument is made that because Fischera was not "registered" with the firm when the sale was completed, he cannot lawfully receive a share of the commission. But if Fischera was entitled to receive a share of the commission when he departed the firm, his failure to be registered when the sale was actually completed cannot defeat this right.
Neither party has favored the undersigned with proposed findings of fact and conclusions of law. However, research by the undersigned has disclosed that several judicially established principles are applicable to the case at bar. First, a salesman is not entitled to a commission, unless, at a minimum, he produces a purchaser who is ready, willing, and able to purchase under the terms fixed by the seller. Judson v. Mobley, 62 So.2d 730 (Fla. 1953); Leon Realty, Inc. v. Hugh, 310 So.2d 767 (Fla. 1st DCA 1975). Whether a salesman is the procuring cause is a question of fact to be determined from the surrounding circumstances. Generally, in order to be the procuring cause of the sale of property, the salesman must have brought the parties together and effected the sale as a result of continuing negotiations begun by him. National Airlines, Inc. v. Oscar E. Dooley Associates, Inc., 160 So.2d 53 (Fla. 3d DCA 1964); Leon Realty, supra; Dixson Kattel, 311 So.2d 827 (Fla. 3d DCA 1975); Fearick v. Smugglers Cove, Inc., 379 So.2d 400 (Fla. 2d DCA 1980). However, it is not necessary that the salesman participate in the final negotiations which culminate in the sale. Moylan v. Estes, 102 So.2d 855 (Fla. 3d DCA 1958). For example, if the buyer and seller immediately negotiate new terms after the abandonment of the original contract, the salesman is still entitled to receive compensation for his services. Moylan, supra.
Applying these principles to the facts herein, it is concluded that Fischera produced a purchaser (Murphy) who was ready, willing, and able to purchase under the terms fixed by the sellers, that he brought the parties together, and that as a result of his continuing efforts the sale was eventually consummated. Even though his active participation in the contract ended on May 13, 1980, the parties negotiated substantially the same contract that was abandoned just prior to his termination of employment. Accordingly, under the facts of this proceeding, Respondents were obligated to share the commission.
Although not dispositive of the issues herein, Respondents' third contention is worthy of comment. Generally, they assert that a contractual matter is in issue and should more appropriately be resolved in circuit court rather than in an administrative setting. The undersigned agrees that a determination of private contractual rights in a disciplinary proceeding is far less desirable than in a circuit court. For one thing, the potential loss of a license can be used as leverage to force a licensee to repay a commission that he might otherwise resist, or to settle civil litigation on less than favorable terms. For another, the parties are not the same, and different rules as to the quantum and type of proof may prevail. Nonetheless there is no impediment to initiating a disciplinary proceeding while a civil action is pending.
Respondents should receive only a reprimand. Their conduct is not so reprehensible as to warrant a more severe penalty. Cases such as this are not clear-cut and the facts can easily be interpreted in different ways depending on which side of the controversy a person sits. Clearly there was no intent on the part of Respondents to intentionally violate the law. Therefore, the above penalty should be imposed.
