STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL ) REGULATION, CONSTRUCTION INDUSTRY ) LICENSING BOARD, )

)

Petitioner, )

)

vs. ) CASE NO. 82-2329

)

HODGES J. JEFFERSON, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice this cause came on for administrative hearing before P. Michael Ruff, duly designated Hearing Officer of the Division of Administrative Hearings on October 13, 1983, in Hollywood, Florida. The following appearances were entered:

APPEARANCES

For Petitioner: Harold M. Braxton, Esquire

45 Southwest 36th Court Miami, Florida 33135

For Respondent: Hodges J. Jefferson, pro se

2250 Northwest 194th Terrace Miami, Florida 33156

This cause arose on an administrative complaint filed by the Petitioner by which it seeks to suspend, revoke or take other disciplinary action against the Respondent's licensure status as a certified general contractor. The Respondent is charged with violating then Section 468.112(2)(e), Florida Statutes (Supp.

1978), reenacted as Section 489.129(1)(h), Florida Statutes (1979); Section 468.112(2)(h), Florida Statutes (Supp. 1978), reenacted as Section 489.129(1)(k), Florida Statutes (1979); Section 468.112(2)(a), Florida Statutes (Supp. 1978), reenacted as Section 489.129(1)(d), Florida Statutes (1979); Section 468.112(2)(g), Florida Statutes (Supp. 1978), reenacted as Section 489.129(1)(j), Florida Statutes (1979), and Section 468.107(b), Florida Statutes (Supp. 1978), reenacted as Section 489.119(5), Florida Statutes (1979), in that the Respondent allegedly abandoned a construction project when it was approximately 55 percent complete after receiving 100 percent of the contract price of $14,900; failed to request a mandatory roof inspection required by the South Florida Building Code, Section 305.2; diverting funds such that he could not finish the project; and by violating Chapter 10, Code of Metropolitan Dade County 10-22(9) by failing to fulfill contractual obligations and failing to request a mandatory building inspection. With regard to Count Two of the administrative complaint it is charged that the Respondent failed to place his certificate number on the contract involved in this proceeding, thus failing to comply with Section 489.119(5), Florida Statutes (1979), and therefore failing

to comply in a material respect with Section 489.129(1)(j), Florida Statutes (1979).

After a number of stipulated continuances and lengthy discovery, this cause was set for hearing on April 27, 1983, and the Hearing Officer and counsel for Petitioner appeared at the hearing. Immediately prior to commencement of the proceeding it was learned by Petitioner's counsel that early that morning or the night before the Respondent had been hospitalized due to gunshot wounds.

Because of his injuries the Respondent required a lengthy convalescence such that the cause was ultimately set for hearing and heard on October 13, 1983.

Subsequent to the hearing the parties were afforded time in which to file proposed findings of fact and conclusions of law and an extended time for filing of late exhibits such that the record was finally closed December 28, 1983. The parties ultimately elected not to file proposed findings of fact and conclusions of law. The issues in dispute concern whether the Respondent abandoned an incomplete project without justification, diverted the owners' funds to unauthorized purposes and otherwise violated the authority cited in the Administrative Complaint.

FINDINGS OF FACT

1. The Respondent, Hodges J. Jefferson, is a registered general contractor having been issued License No. CGC004463. The Petitioner is an agency of the State of Florida charged with regulating the licensure status of contractors in the State of Florida, and with enforcing the requirements of Chapter 489, Florida Statutes, pertaining to licensing and regulation of the practices of general contractors in Florida.

   
   

2. On or about March 3, 1979, Respondent, doing business as H. J. Jefferson Brothers Construction, Inc., entered into a contract with Gladston Kemp to construct a room addition on his residence for a total sum of $14,900. The construction loan by which Mr. Kemp was to finance the addition was ultimately approved sometime in April 1979. The Respondent commenced work on the property after the first check was paid him by Mr. Kemp on May 3, 1979. The Respondent worked for two to three days digging the foundation, constructing the foundation and the brick wall involved and then stopped work for a period of four to five weeks. He then came back and worked on the addition, finishing construction of the foundation, the block walls, the tie beam and the bedroom portion of the roof up to the first layer of tar paper on one side of the addition. The other side of the addition to Mr. Kemp's house was left at that point with the roof not being constructed at all. Up to July 20, 1979, Mr. Kemp had paid the Respondent a total of $7,500, inasmuch as the contract called for payments in one-third increments of the total contract price at various stages of construction. At that point the Respondent left the job after being paid

   $7,500 of the total price. By letter of July 24, 1979, the Respondent demanded an additional $2,900 which would complete approximately the second one-third of the total contract price and on the following day, July 25, Mr. Kemp paid the Respondent the $2,900. Thus, at that point, July 25, 1979, Mr. Kemp had paid the Respondent a total of $10,400. The Respondent did not come back and continue construction of the project. Mr. Kemp tried repeatedly to contact the Respondent, to no avail. After numerous efforts, he contacted him by telephone and the Respondent assured him that he would come by and send "his man" out to commence work, but no one ever appeared to continue the construction. Finally, in October, 1979, Mr. Kemp contacted the Respondent and he once again assured Mr. Kemp that he would come back to finish the job. Additionally, sometime after July 25, 1979, the Respondent demanded $375 from Mr. Kemp to pay for the

   architectural plans drafted by Edna Mingo, the architect who drafted the plans for the job in January, 1979. Mr. Kemp had already paid the $375 to Edna Mingo in January of 1979. In any event, he relented and gave the Respondent the additional $375 in order to induce him to come back and finish the job.

   
   

3. Finally, in the latter part of October 1979, the Respondent returned to the job and began putting rafters on the bedroom portion of the addition. He then asked Mr. Kemp to advance him some more money, over and above the $10,775 Mr. Kemp had already paid him. The roof on one-half of the addition was still not finished, but Mr. Kemp gave the Respondent another $1,700 by check dated November 16, 1979. Approximately two weeks thereafter Mr. Kemp gave the Respondent another $500 in cash. Shortly before Thanksgiving 1979, the Respondent came to the project and asked Mr. Kemp to advance him some more money which Mr. Kemp refused to do. Several days later Mr. Kemp received a "demand letter" from the Respondent asking for more money and reminding him of his obligation to honor the contract. At that point Mr. Kemp contacted the Respondent and met with him at the job site, whereupon Mr. Kemp displayed to him all the checks he had already paid him, informing him of the total amount of money paid and that he did not feel that he owed him any more money. He demanded that the Respondent complete his job.

   
   

4. The Respondent, in turn, sent Mr. Kemp a letter on November 21,1979, informing him that he would complete the job if Mr. Kemp gave him the last one- third of the contract price. At that point Mr. Kemp had already given the Respondent $12,975, so, less than one-third of the contract price was still outstanding. The Respondent assured Mr. Kemp in that letter (Petitioner's Exhibit 17, in evidence) that he would complete the job by December 15, 1979. Mr. Kemp gave the Respondent another $2,100 making a total of $15,075 paid to the Respondent (the contract price being $14,900).

   
   

5. Respondent did not complete the job in December 1979 and indeed never completed it. He went to Mr. Kemp's house "one night in December" and discussed the job with Mrs. Kemp's wife and assured her that he was going to try and get the job "out of the way" by January. The Respondent never came back to continue working on the job and never communicated with the Kemps after December 1979, except for a fist fight between Mr. Kemp and the Respondent engendered by the bitterness resulting form this dispute which occurred in July 1980. Mr. Kemp and his wife, however, went to the Respondent's home in January 1980 to ask him when he would complete the job. He became abusive and would not give them a copy of the plans so that the Kemps had to get a duplicate copy from the architect so Mr. Kemp could then obtain the appropriate inspections from the building department.

   
   

6. There were no extra additions to the contract and the only work ever required of the Respondent was that described on the building plans. The fees fro the electrical, plumbing, and building permits were paid by Mr. Kemp. At the time the Respondent left the job it was approximately 55 percent complete. The roof was incomplete. Mr. Kemp had to do the "rough plumbing," the "finish plumbing," install a half bath, a utility room and a full bath in the bedroom. Mr. Kemp also had to "rough in" the electrical wiring, that is, run the electrical service wiring inside the house for the finish electrical work. Mr. Kemp also had to install drywall and plaster inside and outside the house and completely "finish out" the addition to his home. He supplied some of the labor for this himself and hired various subcontractors to do other portions of the work such that he ultimately spent approximately $9,000 in excess of the amount paid Respondent in order to finish the job in accordance with the building plans. Completion of the work thus cost the Kemps an additional $9.000 above

   the $15,075 already paid the Respondent, with the use of the monies paid Respondent for the last 45 percent of the work required of him by the contract being unexplained, except for the Respondent's general statement that some of that money was attributable to unaccounted for "overhead" costs. The Respondent left the job in terms of performing any work in October 1979, promised to finish it in December and later in January 1980, and never returned to finish the job or perform any more work such that sometime in the summer of 1980 the Kemps ultimately finished the job through their own labors and that of various subcontractors and materialmen they were forced to hire and pay.

   
   

   CONCLUSIONS OF LAW

   
   

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

   
   

8. In Count One of the Administrative Complaint the Petitioner has charged the Respondent with abandoning the subject project when it was approximately 55 percent complete after receiving 100 percent of the contract price; with failing to request a mandatory roof inspection as required by Section 305.2 of the South Florida Building Code and with diverting the funds he received from the owner of the property such that he could not finish the project, as well as with failing to fulfill his contractual obligations by failing to request a mandatory building inspection pursuant to Section 10-22(9) of the Building Code of Metropolitan Dade County. Section 468.112(2)(e), Florida Statutes (Supp. 1978) reenacted as Section 489.129(1)(h), Florida Statutes, provides that the board may revoke, suspend, impose an administrative fine, probation, reprimand or censure upon proof that a contractor has diverted funds or property received for the prosecution or completion of a construction project when, as a result of the diversion, the contractor is unable to fulfill his contractual obligation. Section 468.112(2)(h), Florida Statutes (Supp. 1978), reenacted as Section 489.129(1)(k), Florida Statutes, provides for such penalties upon proof that the contractor has abandoned the construction project in which he is engaged or under contract, which term is defined as the termination by a contractor of the project without notification to the prospective owner and without just cause for longer than ninety days.

   
   

9. There is no question given the above findings of fact and the evidence of record that the Respondent clearly received $15,075 instead of the $14,900 amount he was entitled to pursuant to the terms of the contract, and left the job approximately 45 percent incomplete after having received that amount.

   There is similarly no doubt that, after receiving those funds the Respondent was financially unable to fulfill the terms of his obligations, as evidenced by Mr. Jefferson's repeated requests for additional funds from the Kemps as a condition precedent to his recommencing work on the substantially incomplete project, at times when he had already received as much or more of the contracted amounts to which he was entitled at the particular stage of construction when he made the additional requests. This had the result of causing a substantial financial loss to the owners by causing them to have to pay an additional amount of $9,000 to have the project completed in the manner required by the contract, due to the Respondent's failure to complete work and his use of the monies received for other purposes. Similarly, it is obvious that the Respondent abandoned the contract since he performed no work at all after October 1979, and had only intermittently worked on the job before that time. After October 1979 he performed no work whatever and failed to communicate any justification for his failure to perform to the owners. He sought to avoid the owners' attempts to communicate with him at every opportunity such that the owners never got the

   project completed until they performed it at their own labor and expense many months later. Thus, the charges that the Respondent wrongfully diverted the funds received pursuant to the contract and abandoned the project for purposes of the above statutory sections has clearly been proven.

   
   

10. Section 468.112(2(a), Florida Statutes (Supp. 1978), reenacted as Section 489.129(1)(d), Florida Statutes (1979), provides for imposition of the penalties listed above for willful or deliberate disregard and violation of applicable building codes or laws of the state, municipalities or counties which are applicable to a particular project. There is no question that the evidence in this case and the above Findings of Fact establish that the Respondent failed to request a mandatory roof inspection and failed to request a building inspection upon completion of the building because, simply, he failed to ever complete the roof and the entire building such that either inspection could be requested of and performed by a Dade County building official. Thus, Count One of the Administrative Complaint has been proven in its entirety.

    
    

11. Count Two concerns the charge that the Respondent violated Section 468.112(2)(g), Florida Statutes (Supp. 1978), reenacted as Section 489.129(1)(j), Florida Statutes (1979), which provides for the referenced penalties upon failure of a contractor to comply with the provisions of Chapter

    489 in any material respect. In this regard it is charged that Respondent failed to place his contractor's certificate number upon the contract between them and the Kemps. This count should be dismissed since the only completed contract, in evidence as Petitioner's Exhibits 8 and 9 dated January 20, 1979, and June 11, 1979, (the terms of which are identical) contains the number "CGC004463" which is the Respondent's license number, as the Petitioner alleged in its Administrative Complaint and proved in its case-in-chief. Thus, the Respondent did indeed comply with the provision cited last, above.

    
    

12. The Respondent's infractions of the above statutory authority related to Count One are indeed serious ones. He contracted to perform the entire construction project involving the addition to the Kemp's home for the sum of

$14,900 and only competed 55 percent of that project, although he received

$15,075. The Kemps had to expend a substantial additional sum to have the project completed. In effect the Respondent performed approximately $6,000 worth of work on the job and was unjustly enriched by approximately $9,075. Additionally, the Kemps were forced to endure their home being uncompleted for a substantial number of months, at lest from October 1979 when the Respondent last worked on the job until sometime in approximately July 1980 when they were able to have the home completed by their own devices. Thus, the Kemps have suffered an extreme financial inconvenience and delay by the Respondent's actions. The First District Court of Appeal in Bowling v. Department of Insurance, 394 So.2d

165 (Fla. 1st DCA 1981), provided that in proceedings which may result in the loss of a valuable business or professional license the critical matters in issue must be shown ". . . by evidence which is indubitably 'substantial' as the consequences." The proof by a petitioner must be "as serious minded as the penalty is serious." Here it is patently obvious that the proof by the Petitioner is certainly substantial enough to justify a serious penalty of the nature delineated in the above-cited authority. Here the violations by the Respondent are not merely technical infractions of the pertinent statutes or rules regulating the business and practices of contractors, but rather they resulted in a serious financial and temporal loss by the victims, the Kemps, members of the public who are entitled to rely upon the fidelity of licensed contractors to the mandates of Chapter 489 and related and incorporated building codes.

RECOMMENDATION

Having considered the foregoing Findings of Fact and Conclusions of Law, the evidence of record and the candor and demeanor of the witnesses, it is, therefore

RECOMMENDED that the contractor's license of Hodges J. Jefferson be suspended for a period of 5 years, provided however, that if he makes full restitution to the Kemps of all monies they expended for labor, materials and permits to complete the work he was contractually obligated to complete within one year from a Final Order herein that that suspension should be terminated and his license reinstated.

DONE AND ENTERED this 14th day of March 1984 in Tallahassee, Florida.

P. MICHAEL RUFF Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 14th day of March 1984.

COPIES FURNISHED:

Harold M. Braxton, Esquire

45 Southwest 36th Court Miami, Florida 33135

Hodges J. Jefferson

2250 Northwest 194th Terrace Miami, Florida 33156

James Linnan, Executive Director Construction Industry Licensing Board Post Office Box 2

Jacksonville, Florida 32202

Fred M. Roche, Secretary

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

Docket for Case No: 82-002329

Orders for Case No: 82-002329