STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF AGRICULTURE )

AND CONSUMER SERVICES, )

)

Petitioner, )

)

vs. ) CASE NO. 83-754

)

MOCAR OIL COMPANY, )

)

Respondent. )

)

RECOMMENDED ORDER

This matter came on for hearing in Pensacola, Florida, before the Division of Administrative Hearings, by its duly designated Hearing Officer, Robert T. Benton, II, on May 24, 1983. The parties were represented by counsel:

For Petitioner: Robert A. Chastain, Esquire

Mayo Building

Tallahassee, Florida 32301

For Respondent: James Milton Wilson, Esquire

201 E. Government Street Pensacola, Florida 32598

In order to secure the release of certain gasoline that had been mixed with alcohol, respondent posted a thousand dollar ($1,000.00) bond and petitioner withdrew its stop sale notice. The issues are whether the gas-alcohol-mix violated petitioner's "50 percent evaporated temperature" standard, Rule 5F- 2.01(1)(c)(2), Florida Administrative Code, when impounded, and what disposition to make of the bond respondent posted.

At hearing the parties entered into various stipulations and agreed that no material facts remained in dispute. They then stipulated to proceed pursuant to Section 120.57(1), Florida Statutes (1981).

FINDINGS OF FACT

1. On October 7, 1982, petitioner's employee took samples of gasoline offered for sale at respondent's Beacon Store No. 7 in Milton, Florida, including a sample of regular gasoline mixed with alcohol, known as "regularhol." The regularhol sample reached petitioner's laboratory in Tallahassee on October 11, 1982, and tests done the following day revealed that the 50 percent evaporated distillation temperature of the mix as a whole was 151 degrees Fahrenheit. Otherwise the tests revealed no problem with any of the gasolines sampled. A stop sale notice issued on October 13, 1982, and, after bond in the amount of one thousand dollars ($1,000.00) was posted, in lieu of confiscation of 3,865 gallons, the "regularhol" was released on November 8, 1982.

2. Respondent began mixing regular gasoline with ethanol and selling it as regularhol in 1978 at the same price as regular gasoline. Until recently, Mocar made less on regularhol sales than on sales of regular gasoline. It originally offered regularhol as its way of helping to reduce the national consumption of petroleum. It has now discontinued sales of regularhol.

   
   

3. The Phillips' terminal in Pensacola was respondent's source of the regular gasoline it mixed to make regularhol. This gasoline reached Pensacola by barge, and petitioner's employees sampled and tested each barge's cargo. The

   50 percent evaporated distillation temperature of the regular gas Mocar bought from Phillips varied over a range of more than 30 degrees Fahrenheit upwards from 181 degrees Fahrenheit. Mixing ethanol with the gasoline lowered its distillation temperature, but with the single exception of the batch sampled on July 14, 1982, Mocar's regularhol had passed the testing petitioner has regularly (once every three or four months) conducted. There had also been a problem with gasohol once before.

   
   

   CONCLUSIONS OF LAW

   
   

4. Although not specifically named in Chapter 525, Florida Statutes (1981), "regularhol," or gasoline mixed with ethanol, falls within the category of "gasoline, naphtha, kerosene, benzine, or other like products of petroleum under whatever name designated, used for illuminating, heating, cooling or power purposes," Section 525.01, Florida Statutes (1981), and is therefore subject to confiscation, if it is shown to "fall below the standard fixed by the Department of Agriculture and Consumer Services." Section 525.06, Florida Statutes (1981). Although petitioner's rules do not fix standards for regularhol as such, guidelines for "gasoline" do exist.

   
   

5. The sale of "gasohol" or unleaded gasoline mixed with ethanol is specifically authorized by statute:

   
   

   . . .Alcohol-blended fuels which contain 90 percent unleaded gasoline and 10 percent ethyl alcohol of a minimum of 198 proof and a maximum 50 parts per million of acetic acid, commonly known as "gasohol," may be sold at retail service stations for use in motor vehicles, as long as the gasoline component complies with current state specifications, until the American Society for Testing and Materials approves specifications for gasohol. Section 526.06, Florida Statutes (1981)(emphasis supplied).

   
   

   There is no such specific statutory authorization for the sale of regular gasoline blended with alcohol, nor is there any statutory basis for separating regular gasoline from the alcohol with which it is blended, before testing.

   Compare Department of Agriculture and Consumer Services v. Delta Oil Co., No. 82-2131 (DOAH, Recommended Order entered December 29, 1982).

   
   

6. "Regularhol" must conform to the minimum standards prescribed for "all gasolines offered for sale in Florida." Rule 5F-2.01(1), Florida Administrative Code. Among those standards is one pertaining to distillation range, which refers to "ASTM Method D. 86," Rule 5F-2.01(1)(c) , Florida Administrative Code, and requires:

   The 50 percent evaporated temperature shall not be less than 170 degrees Fahrenheit

   (77 degrees Celsius and shall not exceed 240 degrees Fahrenheit (116 degrees Celsius.

   Rule 5F-2.01(1)(c)(2) , F.A.C.

   
   

   The "regularhol" sampled at Beacon No. 7 had a 50 percent evaporation temperature of 151 degrees Fahrenheit. 19 degrees less than the minimum allowed. For that reason, respondent's "regularhol" is "subject to confiscation and sale by order of the department." Section 525.06, Florida Statutes (1981).

   
   

7. In the present case, petitioner seeks not confiscation but retention of the thousand dollar bond posted by respondent, proceeding under Section 525.06, Florida Statutes (1981), which provides:

   
   

   . . .Instead of confiscation, a refundable bond in cash or by certified check in the amount of the value of the product subject to confiscation may be accepted by the department, pending legal disposition. The amount of this bond shall be limited to

   $1,000. If any of the product has been sold to retail customers, the department is authorized to make an assessment equal to the retail value of the product sold, not to exceed $1,000.

   
   

   Petitioner has the burden of proof whether it proposes to confiscate, make an assessment or retain money posted as a bond. Such proceedings are closely analogous to disciplinary proceedings by state agencies against licensees.

   Although there is no requirement to prove scienter or intent, cf. Division of Pari-Mutuel Wagering, Department of Business Regulation v. Caple, 362 So.2d 1350 (Fla. 1978), confiscation of private property or levying an administrative fine makes these cases, even more than license revocation cases, "'penal' in nature." State ex rel. Vining v. Florida Real Estate Commission, 289 So.2d 391 (Fla.

   1974); Bach v. Florida State Board of Dentistry, 378 So.2d 34 (Fla. 1st DCA 1979)(reh. den. 1980).

   
   

8. At the formal hearing, petitioner had the burden to show by clear and convincing evidence that respondent's regularhol was nonstandard as alleged in the stop sale notice. See Walker v. State, 322 So.2d 612 (Fla. 3d DCA 1974); Reid v. Florida Real Estate Commission, 188 So.2d 846 (Fla. 2d DCA 1966). The alleged deviation from standards must appear clearly from applicable statutes or rules or have a "substantial basis," Bowling v. Department of Insurance, 394 So.2d 165, 173 (Fla. 1st DCA 1981) , in the evidence. Petitioner has met its burden here; the rule and the stipulated evidence are clear.

   
   

9. The question remains as to how to dispose of the bond respondent has posted. Although the statute might be interpreted to authorize petitioner to retain the whole sum, a long line of cases reflects petitioner's consistent interpretation of the statute to allow the return of part of the bond to the owner of the nonstandard gasoline. E.g., Department of Agriculture and Consumer Services v. Big "S" Oil Co., No. 81-3217, 4 FALR 1319-A (Final Order entered May 10, 1982); State of Florida Department of Agriculture and Consumer Services v. One Stop Oil Co., No. 82-342, 4 FALR 1320-A (Final Order entered April 30, 1982); Department of Agriculture and Consumer Services v. Romaco, Inc. d/b/a Majik Market, No. 82-3102, 4 FALR 818-A (Final Order entered February 24, 1982);

State of Florida, Department of Agriculture and Consumer Services v. Emmett C. Wever d/b/a Ormond Mall 66 Service, No. 81-2831, 4 FALR 828-A (Final Order entered February 2, 1982). In construing the statute, deference should be given to the agency's consistent interpretation, in the circumstances of the present case.

RECOMMENDATION

Upon consideration of the foregoing, it is RECOMMENDED:

That petitioner retain five hundred dollars ($500.00) and return five hundred dollars ($500.00) to the respondent.

DONE and ENTERED this 2nd day of June, 1983, in Tallahassee, Florida.

ROBERT T. BENTON, II

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 2nd day of June, 1983.

COPIES FURNISHED:

Robert A. Chastain, Esquire Department of Agriculture and Consumer Services

Mayo Building

Tallahassee, Florida 32301

James Milton Wilson, Esquire

201 E. Government Street Pensacola, Florida 32598

Doyle Conner, Commissioner of Agriculture

Department of Agriculture and Consumer Services

The Capitol Tallahassee, Florida

Docket for Case No: 83-000754

Orders for Case No: 83-000754