STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) CASE NO. 83-2735

)

GUS SCHMIDT, )

)

Respondent. )

)

RECOMMENDED ORDER

This case was heard on February 1, 1984, by R. L. Caleen, Jr., Hearing Officer with the Division of Administrative Hearings, in West Palm Beach, Florida.

APPEARANCES

For Petitioner: Stephanie A. Daniel, Esquire

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

For Respondent: Gus Schmidt, pro se

602 North "A" Street

Lake Worth, Florida 33460

ISSUE

Whether respondent's registered building contractor's license should be revoked, suspended or otherwise disciplined based on allegations he violated (1) Section 489.129(1)(c), Florida Statutes, in that he violated a provision of Chapter 455, Florida Statutes; (2) Section 489.129(1)(g), Florida Statutes, in that he acted in the capacity of a contractor under a name other than on his registration; and (3) Section 489.129(1)(j), Florida Statutes, in that he failed, in two material respects, to comply with the provisions of Chapter 489, Florida Statutes.

BACKGROUND

By an Administrative Complaint dated August 9, 1983, petitioner Department of Professional Regulation, Florida Construction Industry Licensing Board ("Department") alleges that Gus Schmidt ("respondent") failed to properly qualify Gus Schmidt Home Improvements, Inc., operated in the capacity of a contractor under the name Gus Schmidt Home Improvements, Inc., which was not authorized by his contractor's license; engaged in contracting beyond the scope of his registration; failed in a material respect to comply with the provisions of Chapter 489, Florida Statutes, with reference to the duty imposed upon

contractors to qualify business enterprises prior to engaging in business as such entities; and violated a provision of Chapter 455, Florida Statutes, by making a fraudulent representation about his warranty obligations.

At hearing, the Department presented the testimony of Thomas G. McAndrews, Edward R. Flynn, Nancy Kaminiski and Beatrice McLaughlin. Respondent testified on his own behalf. Petitioner's Exhibit Nos. 1 through 10, and Respondent's Exhibit No. 1 were received into evidence.

The Department filed post-hearing proposed findings of fact; the respondent did not. The transcript of the hearing was filed on February 17, 1984.

FINDINGS OF FACT

1. At all times material hereto, respondent was licensed by the Construction Industry Licensing Board as a registered building contractor, having been issued a license number RR 0007671. He was not, however, licensed as a roofing contractor. Neither did he, at any time, qualify Gus Schmidt Home Improvements, Inc., with the Construction Industry Licensing Board. (See Petitioner's Exhibit 1).

   
   

2. In 1968, respondent was issued a limited general contractor's license by Palm Beach County, Florida, under which he was authorized to install roofs only on structures which he constructed; he was not authorized to re-roof existing roofs. He has continuously renewed this local license, from 1968 to the present. On November 26, 1979, he qualified Gus Schmidt Home Improvements, Inc., with the Palm Beach County Construction Industry Licensing Board, which qualifications he has maintained to the present time. (See Petitioner's Exhibits 5).

   
   

3. At all times material hereto, he held no other certificates of competency issued by Palm Beach County, Florida. At all times material hereto, he was the only qualifier for Gus Schmidt Home Improvements, Inc. ( See Petitioner's Exhibit 5).

   
   

4. On or about May 5, 1980, he signed and submitted a notarized letter of authorization to the Palm Beach County Building Department. By this letter, he authorized Linda DeVito, his daughter, to obtain local building permits in the name of Gus Schmidt Home Improvements, Inc., and accepted liability for all acts performed under the permits. (See Petitioner's Exhibit 6).

   
   

5. On or about May 29, 1980, Gus Schmidt Home Improvements, Inc., contracted with Mr. and Mrs. Garrett McLaughlin to remove and replace the existing roof over the carport and entry-way of the McLaughlin's home, and waterproof the entire roof. The house is located at 2041 Upland Road, West Palm Beach, Florida. The contract was signed by an employee of the respondent, and contained a five-year warranty on the work performed by Gus Schmidt Home Improvements, Inc. The contract price was $2,532.00. (See Petitioner's Exhibit 8).

   
   

6. On or about June 16, 1980, Linda DeVito, as the authorized agent for Gus Schmidt Home Improvements, Inc., applied for a county building permit to perform the roofing work on the McLaughlins' home. Based on her application, a county building permit, number 80-14711, was issued to Gus Schmidt Home Improvements, Inc. (See Petitioner's Composite Exhibit 7).

7. This permit was issued based on respondent's letter of authorization, dated March 5, 1980, which was on file with the Palm Beach County Building Department. (See Petitioner's Exhibits 6 and 7).

   
   

8. In or about August 1980, Gus Schmidt Home Improvements, Inc., completed the re-roofing work on the McLaughlins' home, without subcontracting it.

   
   

9. Between May 29, 1980, and July 29, 1980, Mrs. McLaughlin paid Gus Schmidt Home Improvements, Inc., $2,532.00--the full contract price. (See Petitioner's Exhibit 10).

   
   

10. A few weeks after the roofing work was completed, Mrs. McLaughlin checked the roof and discovered that the coating had not completely covered it. There were openings where stones were showing. She became concerned and called Gust Schmidt Home Improvements, Inc. She was told not to worry because the work was covered by a five-year warranty.

    
    

11. During 1981, weeds began to grow on the McLaughlins' roof. In May or June of 1982, Mrs. McLaughlin called respondent to complain about the roof's condition. He told her that he had gotten out of the business before the work on the McLaughlins' home was completed, and that a company on Lake Avenue in West Palm Beach, Florida, had done the work on her home. He told her that he would call her back with further information, but never did.

    
    

12. When respondent did not call back with further information, Mrs. McLaughlin checked the phone book and decided that respondent must have been referring to a company called Florida Exteriors. She called that company and was told that they would honor her warranty. But the roof on Mrs. McLaughlin's home was never repaired, even though the roof leaked where boards had been replaced.

    
    

    CONCLUSIONS OF LAW

    
    

13. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding. Section 120.57, Florida Statutes (1983).

    
    

14. The Construction Industry Licensing Board is empowered to revoke, suspend, or otherwise discipline the certificate or registration of a contractor if he is found guilty of violating Section 489.129(1), Florida Statutes (1983), which includes:

    
    

    (c) Violation of Chapter 455;

    * * *

    (g) Acting in the capacity of a contractor under any certificate or registration issued hereunder except in the name of the certificate holder or registrant as set forth on the issued certificate or registration, or in accordance with the personnel of the certificate holder or registrant as set forth in the application for the certificate or registration, or as later changed as provided in this act; and

    * * *

    (j) Failure in any material respect to comply with the provisions of this act.

15. License revocation proceedings, such as this, are penal in nature.

    The prosecuting agency must prove its charges by clear and convincing evidence-- by evidence as substantial as the consequences. See, Reid v. Florida Real Estate Commission, 188 So.2d 846 (Fla. 2d DCA 1966); Walker v. State, 322 So.2d 612 (Fla. 2d DCA 1975); Bowling v. Dept. of Insurance, 394 So.2d 165, 172 (Fla.

    1st DCA 1981).

    
    

16. Measured by these standards, it is concluded that respondent has violated Section 489.129(2) and (3), and thereby Section 489.129(1)(j) by failing to properly qualify Gus Schmidt Home Improvements, Inc., prior to engaging in the business of contracting under that name. He violated Section 489.129(1)(g) by acting in the capacity of a contractor under the name of Gus Schmidt Home Improvements, Inc., a name not on his registration. He also failed to comply with Sections 489.113(3) and 489.117(2), thereby violating Section 489.129(1)(j), by performing re-roofing work not authorized by his local certificate.

    
    

17. The Department has not, however, proved its allegation that respondent violated Section 489.129(1)(c) by making a misleading, deceptive, untrue, or fraudulent representation forbidden by Section 455.227(1). Statutes providing grounds for revocation of licenses must be strictly construed. State v. Pattishall, 126 So. 147, 148 (Fla. 1930). There is no evidence that respondent knew of the five-year warranty at the time it was made by his agent or employee; that he either approved of it, or subsequently ratified it. To prove that a representation of future intention was fraudulent, more must be shown then that the representation was not subsequently fulfilled. It must be shown that the representation was not subsequently fulfilled. It must be shown that the representation, when made, was knowingly false. See, Brad v. Jernigan, 188 So.2d 575 (Fla. 2d DCA 1966). In the instant case, it has not been shown that respondent knowingly made any warranty which was false. Even if he inadvertently, or negligently, failed to adequately supervise his employees, and insure the correctness of their representations, such conduct does not translate into the personal culpability required of a licensee prior to revoking his license under Chapter 489, Florida Statutes. See, Bach v. Florida State Board of Dentistry, 378 So.2d 34, 37 (Fla. 1st DCA 1980).

    
    

18. Penalty. The Department seeks suspension of respondent's license for two years, and imposition of a $500 administrative fine. See, Section 489.129(1), Florida Statutes (1983). Under the circumstances of this case a six-month suspension of his contractor's license and a $1000 administrative fine would be appropriate.

    
    

19. The Department's proposed findings of fact have been considered. To the extent they are incorporated in this Recommended Order, they are adopted. Otherwise, they are rejected as unsupported by the evidence as unnecessary to resolution of the issues presented.

RECOMMENDATION

Based on the foregoing, it is RECOMMENDED that respondent's contractor's license be suspended for six months, and that he be administratively fined

$1000.

DONE AND ENTERED this 12th day of April 1984 in Tallahassee, Florida.

R. L. CALEEN, JR. 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 12th day of April 1984.

COPIES FURNISHED:

Stephanie A. Daniel, Esquire Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

Gus Schmidt

602 North "A" Street

Lake Worth, Florida 33460

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: 83-002735

Orders for Case No: 83-002735