STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) CASE NO. 82-1711

) CHEEZEM AND ASSOCIATES, INC., ) KENNETH E. BROWN, CHARLES K. ) CHEEZEM and EDWARDO AVILA, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, on September 28 and 29, 1982, at the Pinellas County Judicial Building, St.

Petersburg, Florida. The issue for determination at the hearing was whether respondents' real estate licenses should be revoked, suspended or otherwise disciplined for the reasons set forth in the Administrative Complaint filed on May 28, 1982.

APPEARANCES

For Petitioner: J. L. "Skip" Miller

2426 First Avenue North

St. Petersburg, Florida 33713

For Respondents: John T. Allen and Michael J. Keane

4508 Central Avenue

St. Petersburg, Florida 33711 INTRODUCTION

By a three-count Administrative Complaint filed on May 28, 1982, the petitioner charges each of the respondents with fraud, misrepresentation, concealment, false promises, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in violation of Section 475.25(1)(b) Florida Statutes (1981). The factual allegations of the Complaint all relate to a purported Assignment Listing Agreement between James R. Cope and each of the named respondents. In lieu of reciting the many factual allegations contained therein, a copy of the Administrative Complaint is attached to this Recommended Order.

At the beginning of the administrative hearing, counsel for the petitioner announced that he planned to present no evidence as to the guilt or innocence of respondent Kenneth Brom. Mr. Brown was therefore dismissed as a party- respondent. In support of its charges against the remaining respondents, the

petitioner presented the testimony of Christine Poirier, Michele Ann Collins, Melanie Goodman, Charles K. Cheezem, Edwardo Avila and James R. Cope.

Petitioner's Exhibits 1 through 4 were received into evidence.

At the conclusion of the petitioner's case in chief, the respondents moved to dismiss the Administrative Complaint for failure of the petitioner to make a prima facie case. After due deliberation and oral argument by counsel for both parties, the undersigned granted the respondents' motion and announced that a Recommended Order of Dismissal of the Complaint would be entered as to each of the named respondents. The respondents accordingly elected not to present any evidence at the hearing. Subsequent to the hearing, the respondents filed a proposed Recommended Order, which has been considered by the Hearing Officer.

FINDINGS OF FACT

Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found:

1. On September 23, 1980, James R. Cope signed a Reservation Agreement with Cheezem Investment Program I, Ltd. or its assigns expressing his interest in purchasing Unit 604 in the proposed Landmark Towers Two, a condominium located on Sand Key at 1250 Gulf Boulevard, Clearwater, Florida. A Purchase Agreement for Unit 604 was executed on March 19, 1981, and the Copes provided a down payment of $10,920 on a total purchase price of $109,200. At the time he executed this Purchase Agreement, he expected that the building would be completed and the closing on his unit would occur in the Fall of 1981.

   
   

2. Paragraph 8(a) of the Purchase Agreement provided that the Agreement was not assignable without the prior written consent of the Developer, and that any request for assignment must be received in the Developer's office at least sixty (60) days prior to the closing date. Mr. Cope was aware of this provision in his Purchase Agreement.

   
   

3. On July 7, 1981, Mr. Cope selected the balcony, vinyl and carpet for his condominium unit. On the same date, July 7th, a letter was sent to James R. Cope advising him that the Landmark Towers Two was rapidly approaching completion and that the closing of the units was expected to occur by late August or early September. Mr. Cope was advised in that letter that he would be informed of a more definite closing date as the building progressed, and the names of four lending institutions were provided in the event he desired mortgage financing. This July 7, 1981, letter was delivered on July 9, 1981, and the receipt was acknowledged by "Mrs. J. R. Cope." Mr. Cope, who admits that he has problems with his memory, does not recall receiving this specific letter. He remembers being away from his home during a portion of the month of July.

   
   

4. Between the date of the Purchase Agreement and August 3, 1981, Mr. Cope made no attempt to either sell his Unit 604 or to obtain financing. He admits that prior to August 3, 1981, he received one or two communications from the Developers indicating that progress was being made and that the closing would occur. He then became aware that time was running out and he did not know how he could obtain financing for the closing. On August 3, 1981, James R. Cope and Georgia C. Cope signed an Assignment Listing Agreement purporting to give respondent Cheezem and Associates, Inc. the exclusive right to find a purchaser for the rights to the Copes' Unit 604 of the Landmark Tower Two Condominium.

   Mr. Cope could not recall where he obtained the Assignment Listing Agreement form, and stated that he never spoke with anyone at Cheezem and Associates about the assignment.

   
   

5. Shortly after August 3, 1981, respondent Edwardo Avila, the Vice President of Cheezem and Associates, Inc., located in the Miami office, received in the mail the Assignment Listing Agreement signed by the Copes, with the initials of Mr. Benevides at the bottom of the form, indicating acceptance. Mr. Benevides supervised respondents' Sand Key office. Mr. Avila considered that the form was sent to him by Mr. Benevides for his (Avila's) approval, since he was the broker in charge. Listing contracts are between the seller and the broker. Since Mr. Benevides was not a broker, it was proper for him to initial the form (indicating that he had checked it for accuracy) and send it to the brokers in Miami for their acceptance. Mr. Avila did not approve or return the Assignment Listing Agreement since notice of the anticipated closing dates for the Landmark Towers Two Condominium had been sent out and it was then well within the sixty-day period during which assignments could not be made, pursuant to the Purchase Agreement. Mr. Avila did not notify the Copes that the assignment was not accepted because the person who instituted the policy of prohibiting assignments within sixty days of the closing date was Mr. Cope's

   son-in-law and Mr. Avila felt that Mr. Cope would be aware of the prohibition against assignments. While Mr. Avila was not aware of the exact closing date on the Copes' unit, he knew that the anticipated closing dates were in late August or early September. Mr. Cope never received a copy of the Assignment Listing Agreement with Mr. Benevides' initials on it.

   
   

6. By letter dated August 25, 1981, Mr. Cope was advised that the closing date on his condominium unit had been scheduled for September 18, 1981, and that he should be prepared to pay all monies due at that time. Mr. Cope then became concerned that he would have to forfeit his deposit since no sale of the condominium had been made. During a conversation with an attorney on another matter, Mr. Cope revealed his fear that he would lose his deposit and expressed doubt that Cheezem and Associates were actively attempting to sell his unit. That attorney contacted a real estate salesperson, Ms. Goodman, and requested that she go to the sales office at Sand Key and determine whether Unit 604 was for sale. Ms. Goodman did so on or about September 6, 1981. She spoke with a salesperson named Pat Massaro and told her she was shopping for her parents and wanted something on the sixth floor. She was given a list of condominiums which were available to be sold by the Developer. None of the units listed were on the sixth floor. Ms. Goodman did not specifically ask for Unit 604, nor did she make a request for assignment listings. She reported her findings to the attorney to whom Mr. Cope had spoken, and he requested her to obtain another person to investigate the matter.

   
   

7. Ms. Goodman obtained an acquaintance of hers, Ms. Collins, to go to the sales office at Sand Key for the same purpose. Ms. Collins told Christine Poirier, a salesperson on the premises, that she was looking for a unit for her mother-in-law. She was given the same or a similar listing of units available as was given to Ms. Goodman. Ms. Collins did not specifically tell Ms. Poirier that she was interested in either Unit 604, something on the sixth floor, or a listing of assignments. Ms. Poirier could not specifically recall Ms. Collins, but testified that she generally did not spend a great deal of time or effort with prospects who stated that they were shopping for someone else.

   
   

8. Christine Poirier worked as a real estate salesperson for Cheezem and Associates, Inc. at the Sand Key offices from May of 1978 to November of 1981. She considered herself as part of the Developer's sales force. On one occasion,

   Mr. Benevides, the sales manager at the Sand Key office, made one "casual" statement to her to the effect that the Developer's units should be sold first and that assignments should be sold only if the Developer's units did not suit the buyer's taste or price range. She never heard this statement from respondent Cheezem or respondent Avila, who visited the Sand Key office on an infrequent basis. An assignment listing book was maintained at the Sand Key office, and assignments were accepted and sold prior to July 1, 1981. After that period, assignments were not accepted due to the sixty-day clause in the individual Purchase Agreements. Ms. Poirier does not recall ever seeing an assignment listing for the Copes' Unit 604.

   
   

9. Between August 3, 1981 and September 6, 1981, Mr. Cope never contacted anyone with Cheezem and Associates to determine the status of his Assignment Listing Agreement. The Copes never requested consent of the Developer to assign their condominium unit to another purchaser.

   
   

10. The respondents never instructed their sales personnel not to represent to prospective purchasers that Unit 604 or any other unit under an Assignment Listing Agreement was available for purchase.

    
    

11. As of the date of this hearing, the closing on Unit 604 had not occurred and Mr. Cope had not yet forfeited his deposit. Litigation not relevant to this proceeding is pending.

    
    

    CONCLUSIONS OF LAW

    
    

12. The petitioner in this case has totally failed to prove the material factual allegations of the Administrative Complaint. The testimony of the complaining witness, James R. Cope, establishes that prior to August 3, 1981, he had received one or two communications from the Developers that the closing was to occur in late August or early September. He was fully aware of the provision in his Purchase Agreement which prohibited assignments within sixty days from the date of closing. While Mr. Cope executed a form entitled "Assignment Listing Agreement," he never received a statement or other communication from anyone at Cheezem and Associates that Cheezem and Associates accepted this Agreement. These statements from Mr. Cope are corroborated by respondent Avila, who stated that he never returned the Listing Agreement to the Sand Key office because it was within the prohibited sixty-day period, and by Ms. Poirier, who testified that she did not recall ever seeing a listing for Unit 604. There being no binding agreement between Mr. Cope and any of the respondents in this case, there can be no cause of action against the respondents based on this alleged Assignment Listing Agreement.

    
    

13. Dealing specifically with the various factual allegations of the Administrative Complaint, petitioner failed to produce any evidence that the named respondents represented to the Copes that an assignment of the Purchase Agreement could be made or that they furnished the Copes with the Assignment Listing Agreement form, as alleged in Paragraph 12, Count I. There was no evidence that respondents falsely, fraudulently or negligently represented to the Copes that an assignment was accepted by the Developer, as alleged in Paragraph 15, Count I. Indeed, Mr. Cope admitted that he had no communication from anyone from Cheezem and Associates regarding the purported Assignment Listing Agreement. In addition, there was no assignment of Mr. Cope's interest in Unit 604 and therefore there was nothing to be accepted by the Developer. Paragraph 17, Count I alleges that the Developer has disavowed consent to assignment of the Purchase Agreement by the Copes. In the sense that Paragraph

    8 (a) of the Purchase Agreement disavows consent within the sixty-day before

    closing period, this is correct. In any other sense, no evidence was adduced to support this allegation. The "Exclusive Right of Sale Listing Agreement Data Sheet," referred to in Paragraph 19, Count II, was never identified or offered into evidence at the hearing. With regard to Paragraph 20, Count II, the evidence established that respondents did know that there was not enough time to approve a new buyer/assignee prior to the anticipated closing date and that is the reason why respondents did not communicate their acceptance of the Assignment Listing Agreement to the Copes. The evidence establishes that the Copes were advised to proceed to obtain financing by the Developers. The respondents had no duty to further advise the Copes, as alleged in Paragraph 21, Count II. There was no evidence offered that the Copes relied upon the expertise of the respondents, as charged in Paragraph 22, Count II., Indeed, the testimony from Mr. Cope establishes that he did not even consult with the respondents on this matter. Paragraph 23, Count II is unsupported by any evidence offered at the hearing. Paragraph 24, even if proven, which it was not, contains no grounds for disciplinary action against the respondents.

    Finally, the allegations of Count III of the Complaint lack supporting competent substantial evidence inasmuch as there was no acceptance by the respondents of the Copes' Assignment Listing Agreement. Further, there was insufficient evidence to establish that prospective purchasers were only made aware of assignment listings when they specifically inquired about them.

    
    

14. For the reasons stated above, the petitioner has failed to establish the factual allegations necessary to prove that the respondents are guilty of fraud, misrepresentation, concealment, false promises, dishonest dealing by trick, scheme or device, culpable negligence or breach of trust in violation of Section 475.25(1)(b), Florida Statutes (1981).

RECOMMENDATION

Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that the Administrative Complaint filed against the respondents on May 28, 1982, be DISMISSED.

Respectfully submitted and entered this 19th day of November, 1982, in Tallahassee, Florida.

DIANE D. TREMOR, 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 19th day of November, 1982.

COPIES FURNISHED:

J. L. "Skip" Miller, Esquire 2426 First Avenue North

St. Petersburg, Florida 33713

John T. Allen, Esquire and Michael J. Keane, Esquire 4508 Central Avenue

St. Petersburg, Florida 33711

William Furlow, Esquire Department of Professional

Regulation - Legal Services

P.O. Box 1900

Orlando, Florida 32802

Mr. C. B. Stafford Executive Director

Florida Real Estate Commission

P.O. Box 1900

Orlando, Florida 32802

Docket for Case No: 82-001711

Orders for Case No: 82-001711