STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL ) REGULATION, FLORIDA REAL ESTATE ) COMMISSION, )

)

Petitioner, )

)

vs. ) CASE NO. 82-523

)

THOMAS P. HOOLIHAN, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to an agreement of counsel, the hearing in this case was waived and the facts and law determined on the basis of the record previously compiled in a related case, Department of Professional Regulation, Florida Real Estate Commission v. Marinatown Realty, Inc., Case No. 81-2097, Final Order entered June 28, 1982.

APPEARANCES

For Petitioner: Xavier J. Fernandez, Esquire

NUCKOLLS JOHNSON & FERNANDEZ

Suite 10, 2710 Cleveland Avenue Fort Myers, Florida 33901

For Respondent: James A. Neel, Esquire

1315 Chalon Lane, Southwest Fort Myers, Florida 33903

The issue for determination in this case is whether the license of Respondent Thomas P. Hoolihan should be revoked, suspended or otherwise disciplined for allegedly failing to pay a commission due to L. E. Hutchinson. The record in Department of Professional Regulation, Florida Real Estate Commission v. Marinatown Realty, Inc., has been furnished by the Department to the Hearing Officer and consists of Petitioner's Exhibits 1-12, Respondent's Exhibits 1-6, and a 188 page transcript of the hearing dated December 1, 1981.

PROCEDURAL BACKGROUND

On July 1, 1982, counsel in the above-styled case moved that the instant case be consolidated with Department of Professional Regulation, Florida Real Estate Commission v. Marinatown Realty, Inc., Case No. 81-2097, since the facts and witnesses were the same and testimony had already been heard in Marinatown Realty, Inc., supra. The instant case was transferred to the Hearing Officer who had presided at Marinatown Realty, Inc. The Motion was denied due to the Hearing Officer's lack of jurisdiction to consolidate a pending case with one in which a Recommended Order had been filed and forwarded to the Commission some two months prior to the receipt of the Motion to Consolidate. The Florida Real

Estate Commission issued a Final Order on June 28, 1982, adopting the Recommended Order in Marinatown Realty, Inc., in its entirety and dismissing the Administrative Complaint filed against the Respondent Marinatown Realty, Inc.

The parties agreed on August 21, 1982 that the record in Marinatown Realty, Inc., supra, be utilized in lieu of holding another hearing since the facts in both cases and witnesses were the same. Subsequently, the Department of Professional Regulation forwarded to the Division of Administrative Hearings the record in Marinatown Realty, Inc., supra.

FINDINGS OF FACT

1. The Respondent Thomas P. Hoolihan is a licensed real estate broker. His last known address is 3440 N.W. Marinatown Lane, North Fort Myers, Florida 33903. Hoolihan is also president of Seago Group, Inc., a publicly held land development and rental corporation, of which Marinatown Realty, Inc., is a wholly owned subsidiary.

   
   

2. In late 1977, Hoolihan met L. E. Hutchinson, the complainant in this case, through another broker for whom Hutchinson at the time was employed. In December 1977, Hoolihan and Hutchinson discussed the marketing of two condominium projects being developed by Hoolihan and reached an oral agreement whereby Hutchinson would be paid $18,000 in salary with a 1.5 percent commission on all sales. when the condominium units were completed and mostly sold, the parties' employment agreement was revised in late December 1979. Under the new agreement, Hutchinson was to receive $30,000 a year salary, commission on the remaining condominium units that had not yet closed and any commissions on outside property listings neither owned nor controlled by Seago. In return for the $30,000 guarantee, Hutchinson was to forego commissions on future properties owned or controlled by Seago Group, Inc.

   
   

3. During the period from 1977-1978 when Hutchinson was receiving $18,000 plus a 1.5 percent commission, sales were handled through Lee Hutchinson Realty, Inc., which held license number 0182945.

   
   

4. In early 1979, Marinatown Realty was incorporated to market Seago's real estate inventory, to identify and list outside properties and to act as a management agent for purposes of renting condominium units previously sold in recent projects.

   
   

5. When Marinatown Realty was formed, the complainant became its active broker. While employed as the broker for Marinatown and receiving $30,000 a year as a salaried employee, Hutchinson held two other broker's licenses, one as

   L. E. Hutchinson Realty, Inc., and another as L. E. Hutchinson.

   
   

6. In January 1980, Hoolihan agreed to pay a $15,000 bonus to Hutchinson in lieu of a salary increase. Since at that time sales were minimal, Hoolihan decided to pay the bonus in installments as sales occurred. Because Hutchinson left in May 1980, he received only $10,000 of the bonus which represented monies previously paid.

   
   

7. On April 23, 1980, Hutchinson and Chuck Bundschu, a licensed real estate broker, negotiated and obtained a sales contract between Hancock Harbor Properties, Ltd., a wholly owned subsidiary of Seago Group, Inc., seller, and Frank Hoffer, buyer and licensed real estate broker, in which Hoffer offered to purchase approximately 3.16 acres of unimproved acreage for $500,000. Thomas P.

   Hoolihan, general partner of Hancock Harbor, executed the contract on behalf of the partnership.

   
   

8. Prior to presenting the contract to Hoolihan, Bundschu, Hoffer and Hutchins on decided on a 30 percent, 40 percent, 30 percent, respective co- brokerage split on the $50,000 commission due on the sale of the Hancock Harbor Property. The co-brokerage fee split was typed on the bottom of the contract submitted to Hoolihan and was signed by the three brokers. The commission due to Hutchinson was made payable to L. E. Hutchinson Realty, Inc.

   
   

9. On April 25, 1980, the contract with the original co-brokerage split was presented to Hoolihan who refused to agree to its co-brokerage split provision. In the presence of Hutchinson, Hoolihan informed Bundschu and Hoffer that he would not pay a commission to Hutchinson because he was a salaried employee of the Seago Group and not entitled to a commission on the sale of this property. Accordingly, the co-brokerage fee provision of the executed contract was never signed by the seller, Thomas P. Hoolihan. Instead, on April 25, 1980, Bundschu, Hoffer and Hoolihan agreed to a split of $20,000 to Hoffer and $15,000 to Bundschu in lieu of the split specified in the original contract.

   
   

10. At the closing on July 18, 1980, which was held at Coastland Title Company, a closing statement was prepared which shows that real estate commissions were disbursed to Chuck Bundschu Realty, Inc. ($15,000), Marinatown Realty, Inc., ($15,000) and Hoffer's firm, Landco, Inc., ($20,000). The checks were written and disbursed following a conversation between an official of Coastland Title Company and Hoolihan in which Hoolihan informed the official that Hutchinson was a Seago employee and he would not agree to pay a $15,000 commission to him under such circumstances.

    
    

11. On July 18, 1980, a check for $15,000 was issued by Coastland Title Company to Marinatown Realty, Inc. The $15,000 represented Hutchinson's share of the co-brokerage agreement. when received on July 18, 1980, by Billie Robinette, the broker for Marinatown Realty, the check was signed over by her to Seago Group, Inc., since in her opinion it did not represent commissions earned by Marinatown Realty.

    
    

12. The oral agreement between Hutchinson and Hoolihan was to terminate at the end of April 1980, or approximately five days after the Hoffer contract was presented. Hoolihan offered to renew the contract without a provision for a guaranteed salary because Marinatown Realty had been consistently losing money since its incorporation. On May 6, 1980, Hoolihan received a letter of resignation from Hutchinson and concluded that his offer had been rejected

    
    

13. In early May 1980, Hoolihan received a call from Ms. Robinette, who had been employed as Hutchinson's secretary, regarding filling the open brokerage position at Marinatown Realty, Inc. Hoolihan discovered from Ms. Robinette that Hutchinson had paid himself 50 percent of the commissions due Marinatown Realty, Inc., for the management of condominium rentals. After examining the check stubs from Marinatown's bank account, Hoolihan took personal possession of all the books and records of the company and had the office locks changed.

    
    

14. When he examined the books and records of the realty company, Hoolihan realized that his assumption that Hutchinson Realty, Inc., became inactive when Marinatown Realty, Inc. was formed in January 1979, was erroneous and that Hutchinson had operated his own realty company, L. E. Hutchinson Realty, Inc., while employed by Marinatown Realty, Inc.

15. The Administrative Complaint in this case was filed on July 22, 1981. The preliminary investigative report compiled by Robert Corno, DPR Investigator, was filed on September 24, 1981 and the final investigative report was filed on September 30, 1981. The following is a synopsis of the investigator's findings and recommendation:

    
    

    1. That the COMPLAINANT [Hutchinson] worked for the SUBJECT [Hoolihan]

       and their contractual agreement was verbal. COMPLAINANT was paid on a salary/commission basis by companies of which SUBJECT is Chief Officer.

    2. That the COMPLAINANT filed civil action suit against SUBJECT in this

       case and it was dismissed with prejudice.

    3. That prior investigation by the DPR recommended that no action be taken against the SUBJECT in this case.

    4. That two weeks after this investiga- tion was undertaken, an Administrative Complaint was being filed by the DPR against the SUBJECT.

    5. That the existing BROKER for MARINATOWN REALTY, INC, was not involved in this

       case, and that since the time of the above referenced transaction, the SUB-

       JECT has acquired his BROKER'S license

       number 020462 which had no effect in this case.

    6. That conflicting statements by inter- viewers, namely former and present employees and other agents involved in this case revealed that there is a reasonable doubt for probable cause against the SUBJECT. (Respondent's Exhibit 1)

       
       

       As noted by Investigator Corno, this was the second time Marinatown Realty had been investigated in relation to this case. In both instances, a recommendation that no action be taken was apparently made. At the final hearing on December 1, 1981, counsel for the Department saw the complete investigative report, including the investigator's recommendation of a lack of probable cause, for the first time.

       
       

       CONCLUSIONS OF LAW

       
       

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

    
    

17. In Counts I and II of the Administrative Complaint the Respondent is charged with violating Sections 475.25(1)(b) and (d), Florida Statutes (1979), which empower the Board of Real Estate to suspend a license for a period not exceeding 10 years, revoke a license, impose an administrative fine not to exceed $1,000 for each count or separate offense or issue a reprimand if it finds that a licensee has:

    (b) [b]een guilty of fraud, misrepre- sentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence or breach of trust in any business transaction in this state or any other state, nation, or territory; has violated a duty imposed upon him by law or by the terms of a listing con- tract, written, oral, express, or implied, in a real estate transaction; has aided, as- sisted, or conspired with any other person engaged in any such misconduct and in

    furtherance thereof; or has formed an intent, design, or scheme to engage in any such mis- conduct and has committed an overt act in furtherance of such intent, design, or scheme. It shall be immaterial to the guilt of the licensee that the victim or intended victim

    of the misconduct has sustained no damage or loss; that the damage or loss has been settled and paid after discovery of the misconduct;

    or that such victim or intended victim was a customer or a person in confidential relation with the licensee, or was an identified member of the general public,...

    (d) [f]ailed to account or deliver to any person, including a licensee under this chap- ter, 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, con- veyance, lease, or other document or thing

    of value, including a share of real estate commission, or any secret or illegal pro- fit, or any divisible share or portion there- of, 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....

    
    

18. Based on the finding that Hutchinson received a salary of $30,000 in lieu of commissions on sales of property owned or controlled by his employer, Seago Group, Inc., no commission was required to be paid by the Respondent Hoolihan to Hutchinson on the Hoffer transaction as alleged in the Administrative Complaint. Accordingly, no violation of either Section 475.25(1)(b) or (d), Florida Statutes (1979), was established and the Administrative Complaint should be dismissed.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED:

That the Administrative Complaint filed against Thomas P. Hoolihan be dismissed.

DONE and ORDERED this 30th day of December, 1982, in Tallahassee, Florida.

SHARYN L. SMITH, 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 30th day of December, 1982.

COPIES FURNISHED:

Xavier J. Fernandez, Esquire NUCKOLLS JOHNSON & FERNANDEZ

Suite 10, 2710 Cleveland Avenue Fort Myers, Florida 33901

James A. Neel, Esquire 1315 Chalon Lane, S.W. Fort Myers, Florida 33903

William M. Furlow, Esquire Department of Professional

Regulation - Legal Section

400 West Robinson Street Orlando, Florida 32801

C. B. Stafford, Executive Director Florida Real Estate Commission Post Office Box 1900

Orlando, Florida 32802

Samuel R. Shorstein, Secretary Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

Docket for Case No: 82-000523

Orders for Case No: 82-000523