STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE, )

)

Petitioner, )

)

vs. ) CASE NO. 83-027

)

JOYCE HOWELL ALLEN, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in the above case before the Division of Administrative Hearings by its duly designated Hearing Officer, Donald R. Alexander, on June 14, 1983, in Pensacola, Florida.

APPEARANCES

For Petitioner: Dennis S. Silverman, Esquire

and Susan Koch, Esquire Department of Insurance 413-B Larson Building Tallahassee, Florida 32301

For Respondent: Hugh T. Handley, Esquire

213 South Alcaniz Street Pensacola, Florida 32501

BACKGROUND

By Administrative Complaint filed on December 3, 1982, Petitioner, Department of Insurance, has alleged that Respondent, Joyce Howell Allen, has violated various provisions of Chapter 626, Florida Statutes, for which disciplinary action against her license as an ordinary life, including disability agent and general lines agent should be taken. In brief, the Complaint alleged that Respondent, while acting in the capacity of a licensed representative of Gulf Life Insurance Company, submitted ten fraudulent claims with the insurance company during the period November, 1979 through January, 1980, and converted the proceeds of said claims to her personal use. It is further alleged that such acts were in violation of a number of provisions within Chapter 626, Florida Statutes.

Respondent disputed the above allegations and requested a formal hearing pursuant to Subsection 120.57(1), Florida Statutes, to contest the charges. The matter was referred to the Division of Administrative Hearings by Petitioner on January 4, 1983, with a request that a Hearing Officer be assigned to conduct a formal hearing.

By Notice of Hearing dated February 21, 1983, the final hearing was scheduled for April 13, 1983, in Pensacola, Florida. At the request of the

parties, the matter was rescheduled to May 13, 1983, at the same location. On May 6, 1983, Petitioner filed a Motion for Continuance, and with the concurrence of Respondent, the final hearing was rescheduled to June 14, 1983, at the same location.

At the final hearing, Petitioner presented the testimony of Phyllis M. Rioski, director of individual health claim services for Gulf Life Insurance Company, Betty O. Brown, Julia Emmons, Virginia Stewart and Dale Anthony King, all policyholders with the insurance company, Frances Thomley, a physician's office manager, and Ronald M. Dick, an expert in documents examination, and offered Petitioner's Exhibits 1-9; all were received in evidence except Exhibit 9, upon which a ruling was reserved. Exhibit 1 includes the depositions of Drs. Frank E. Williams and R. M. McGrew. Respondent testified on her own behalf and presented the testimony of Marion L. Jones, Ray Georgery Ralis and Max Arlton Hurst, former Gulf employees, and J. F. Smith, a former Department investigator.

The transcript of hearing was filed on June 30, 1983. Proposed findings of fact and conclusions of law were filed by the parties on July 20, 1983, and have been considered by the undersigned in the preparation of this Order. Findings of fact not included in this Order were considered irrelevant to the issues, immaterial to the results reached, or were not supported by competent and substantial evidence.

At the close of Petitioner's case-in-chief, it voluntarily dismissed Counts II, III, VII, VIII, IX and X in their entirety and moved to strike paragraphs 8 and 9 of Count IV of the Administrative Complaint. Remaining at issue herein is whether Respondent should be disciplined for the alleged violations set forth in the remaining counts of the Administrative Complaint dated December 3, 1982.

Based upon all the evidence, the following findings of fact are determined: FINDINGS OF FACT

1. At all times relevant hereto, Respondent, Joyce Howell Allen, was licensed as an ordinary-combination life, including disability insurance agent by Petitioner, Department of Insurance. She was employed by Gulf Life Insurance Company (Gulf) from April, 1979 until January 14, 1980, when her authority to represent that company was cancelled.

   
   

2. Gulf issued accident policies to Betty O. Brown, Julia Emmons, Virginia Stewart and Dale Anthony King. All were sold by Respondent. Under the terms of those policies, the insured received either 25 or 50 for outpatient treatment resulting from an accident to the insured or a dependent. Routinely, such claims were initiated when the insured notified the agent that an injury had been sustained, and furnished the agent a standardized claim form completed by a physician. Upon receipt of this documentation, an insured's statement was then completed by the Gulf agent. The latter statement provided basic information concerning the insured, the nature of the injuries received, the date of the accident, and the name and address of the attending physician and date of treatment. The forms were initially processed in the Pensacola office and were then forwarded to the home office in Jacksonville. Benefit checks made payable to the claimants were prepared by the home office and returned to the agent for delivery to the insured.

   
   

3. Claim forms were filed with Gulf's home office on behalf of Stewart, King, Emmons and Brown in December, 1979 and January, 1980. These have been received in evidence as Petitioner's Exhibits 4C through 7C, respectively. They

   reflect that Stewart and King suffered injuries on December 18, 1979, that both were treated by a Dr. Frank E. Williams of Pensacola, Florida, that Emmons' son and Brown suffered injuries on November 13 and 19, 1979, respectively, and that both were treated by a Dr. R.M. McGrew of Century, Florida. Respondent completed and signed each of the insured's statements that were forwarded to the home office with the claims. Benefit checks in the amount of $50 were later issued to Brown and Emmons by Gulf. These were mailed to Respondent for delivery to the insured. According to the agent's report which was signed by Respondent, Allen claimed the Brown check was delivered to Brown on November 6, 1979, while the Emmons check was delivered to Emmons' mother on December 21, 1979.

   
   

4. The four claimants testified at the final hearing. They uniformly denied that they or their dependents had suffered the injuries reflected on the claim forms and that they had signed the statements. Brown and Emmons also denied ever receiving any benefit checks from Respondent. However, there was no evidence that Respondent converted these checks to her personal use.

   
   

5. Depositions entered into evidence revealed that Drs. Williams and McGrew did not treat the claimants in question, and that the signatures on the statements purporting to be their own were in fact forgeries.

   
   

6. Respondent acknowledged processing the four claims in question, and filling out the information on the insured's statements. As to the Brown, Emmons and Stewart claims, she stated she found these claims in her office mailbox, and merely completed and processed them with a number of other similar claims. She also denied wrongdoing in the entire affair.

   
   

7. As a general rule, Gulf agents furnished blank claim forms to policyholders so that they could be filled out by the insured whenever an accident occurred. Blank doctor's statements were also left with certain physicians who processed these types of claims. However, Respondent acknowledged that she did not furnish Drs. Williams and McGrew with such forms.

   
   

   CONCLUSIONS OF LAW

   
   

8. The Division of Administrative Hearings has jurisdiction of the subject matter and the parties thereto pursuant to Subsection 120.57(1), Florida Statutes.

   
   

9. Requiring resolution at the outset is whether a deposition of Andrew O'Neil Colley, a former district manager of Gulf in Pensacola, is admissible. The deposition was offered by Petitioner and has been marked as Petitioner's Exhibit 9. The deposition was taken on January 12, 1982 in a criminal proceeding styled State of Florida v. Joyce Howell Allen at the request of Allen's counsel in that proceeding. Petitioner contends the deposition is admissible under Rule 1.330(a), Florida Rules of Civil Procedure since Colley died over one year ago. Respondent objects on the grounds (a) the deposition was taken in a criminal vis a vis civil action involving separate counsel; (b) present counsel had no opportunity to cross-examine the witness; and (c) different issues were involved in the prior proceeding.

   
   

10. Rule 1.330(a), Florida Rules of Civil Procedure is clearly inapplicable since the deposition in question was taken in a separate proceeding with different parties. However, Subsection 90.804(2), Florida Statutes is pertinent, provided certain conditions are met. This rule generally provides that the deposition is admissible if the party against whom the testimony is offered "had an opportunity and under similar motive to develop the testimony by

    direct, cross, or redirect examination." Because these conditions have been met, Petitioner's Exhibit 9 is hereby received in evidence.

    
    

11. Remaining at issue are Counts I, IV, V and VI. In broad terms, Petitioner has charged Respondent with violating Subsections 626.561(1), 626.561(2), 626.611(4), 626.611(5), 626.611(7), 626.611(8), 626.611(9), 626.611(10) 626.611(13), 626.621(2), 626.621(3), 626.621(6) , 626.9521, 626.9521(1)(a), 626.9521(5)(a), and 626.9541(5)(6), Florida Statutes, by filing false accident claims under policies issued to Betty O. Brown and Julia Emmons and converting the proceeds ($100) to her own use (Counts I and IV), and with violating Subsections 626.611(4), 626.611(5), 626.611(7), 626.611(8), 626.611(9), 626.611(10), 626.611(13), 626.621(2), 626.621(3) 626.621(6), 626.9521, 626.9521(1)(a), 626.9541 (5)(a) and 626.9541(5)(b), Florida Statutes, by filing false accident claims under policies issued to Virginia Stewart and Dale Anthony King for the purpose of pecuniary gain. (Counts V and VI).

    
    

12. By a sufficient quantum of "substantial" evidence, Petitioner has established that Respondent is guilty of violating all of the foregoing statutes except those that involve the alleged conversion of the claim checks ($100) to Respondent's own personal use (Subsections 626.651(2) and 626.611(10), Florida Statutes). As to the latter charges, there was no evidence to show that Respondent actually converted or misappropriated the funds in question.

    
    

13. Since a number of the statutory violations require a compulsory suspension or revocation of Respondent's license (626.611, F.S.), a one-year suspension is deemed appropriate under the circumstances herein.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Respondent be found guilty as charged in the

Administrative Complaint, except as to those parts which allege she converted funds to her own personal use, and that her license as an ordinary life, including disability agent and general lines agent be suspended for one (1) year.

DONE and ENTERED this 29th day of July, 1983, in Tallahassee, Florida.

DONALD R. ALEXANDER

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 29th day of July, 1983

COPIES FURNISHED:

Dennis S. Silverman, Esquire and Susan Koch, Esquire Department of Insurance

413-B Larson Building Tallahassee, Florida 32301

Hugh T. Handley, Esquire

213 South Alcaniz Street Pensacola, Florida 32501

The Honorable Bill Gunter Insurance Commissioner & Treasurer The Capitol, Plaza Level Tallahassee, Florida 32301

Docket for Case No: 83-000027

Orders for Case No: 83-000027