STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CURTIS A. GOLDEN, STATE ATTORNEY )

for the First Judicial Circuit, )

)

Petitioner, )

)

vs. ) CASE NO. 83-2780

) MIKE'S PAINTING AND CONTRACTING )

COMPANY and its principal M. T. ) MOTES, )

)

Respondents. )

)

RECOMMENDED ORDER

This matter came on for final hearing in Pensacola, Florida, before the Division of Administrative Hearings, by its duly designated Hearing Officer, Robert T. Benton, II, on January 3, 1984. The parties were represented by counsel:

For Petitioner: William P. White, Jr., Esquire

Assistant State Attorney Post Office Box 1272 Pensacola, Florida 32501

For Respondent: Bruce A. McDonald, Esquire

Emmanuel, Sheppard & Condon Post Office Drawer 1271 Pensacola, Florida 32596

By complaint issued August 30, 1983, petitioner alleged that respondents do business in Pensacola, and in a single judicial circuit and that:

Respondents accept payment for repairs to real estate and fail to complete the repairs properly or refund the deposit paid; Respondents failed to provide a contract containing the information and terms required by Section 2-15.02, Florida Administrative

Code; Respondents' continued delays constitute encouragement to the buyer to cancel the contract for repairs contrary to Section

2-15.05, Florida Administrative Code.

The complaint alleges that these practices "violate the law and public policy of the United States and the State of Florida as established by Section(s) [sic] 501.204, Florida Statutes, common law and/or case law" and that they "constitute unfair and/or deceptive trade practices" in that they are unlawful, "unethical, immoral or unscrupulous . . . and . . . have damaged consumers, competitors or other businessmen," all in violation of Part II, Chapter 501, Florida Statutes.

At the close of petitioner's case, respondent's counsel moved ore tenus for a continuance on grounds that respondent Motes was not in attendance at the hearing, but the motion was denied.

On January 20, 1984, petitioner filed a proposed recommended order. The proposed findings of fact have been adopted, in substance, for the most part, but have been rejected where they have been deemed unsupported by the weight of the evidence, immaterial, cumulative, or subordinate.

ISSUE

Whether there is probable cause for petitioner to bring an action against respondents for violation of the Florida Deceptive and Unfair Trade Practices Act?

FINDINGS OF FACT

1. Rita Smith who, a friend testified, has "got to be" 90 years old, has owned the house at 1210 Alcaniz Street in Pensacola, Florida, at least since her husband died on March 20, 1982. Before he died, he gave her money to fix up the house, which she has rented. It needed a new roof, among other things.

   
   

2. She spoke to respondent M. T. Motes after getting an advertisement for Mike's Painting & Contracting Company in the mail. It read:

   
   

   Painting -- Carpentry -- Remodeling Addition Carports

   Residential Specialist Prompt FREE Estimates

   (904)968-5912

   ALL WORK GUARANTEED MIKE'S PAINTING & CONTRACTING CO.

   Post Office Box 261 Gonzalez, Florida 32560

   
   

   Respondent himself--she knew him as "Mike"--seemed like he wanted to work so she sent him to take a look at what was involved. First she misdirected him to 1012 Alcaniz Street but the people who lived there told him there must be some mistake. The second time Mrs. Smith got the address right, and respondent Motes looked things over at the right house.

   
   

3. They eventually agreed on a price of $2800, of which $1500 was to be paid in advance. On April 11, 1983, Charlie Freeman went down to the bank with Mrs. Smith to help her get the money and was present when it changed hands. Among the things Mr. Motes agreed to do in exchange for the $2800 was put on a new roof. As respondent's counsel conceded at hearing, there never was a written contract, but M. T. Motes did acknowledge in writing receiving "$1500 deposit toward repair of rental unit" from Rita Smith. He signed the receipt without mentioning Mike's Painting & Contracting Company.

   
   

4. Respondent Motes and at least one helper worked on the house on April 12, 1983, and again on April 13, 1983. They patched the porch floor, put in some new rafters on the porch, and did some patching of the porch roof, replacing bad wood with good. After he had Mrs. Smith's $1500, Mr. Motes told

   Mr. Freeman that, although he was not a roofer, he would arrange for a roofer to do the roofing work, but the roof was never recovered.

   
   

5. A. L. Cooper, an investigator for the Escambia County Construction Competency Board, inspected the house at 1210 Alcaniz Street on October 25, 1983, at petitioner's request. What had been accomplished there a man and a helper could do easily in two days. The going price for a job like the one Mr. Motes did ranges from $450 to $525. Mr. Motes, who is not licensed as a residential contractor, never obtained a building permit for the work he did for Mrs. Smith, which included "quite a few code violations."

   
   

6. Mrs. Smith reached Mrs. Motes by telephone but did not succeed in her efforts to track down Mr. Motes. She made no payments beyond the initial one.

   
   

   CONCLUSIONS OF LAW

   
   

7. Under the Florida Deceptive and Unfair Trade Practices Act, Sections

   501.201 et seq., Florida Statutes (1981), an "enforcing authority" is authorized to bring an action "to obtain a declaratory judgment that an act or practice violates [Chapter 501, Part II, Florida Statutes (1981)]," Section 501.207(1)(a), Florida Statutes (1981), or an "action on behalf of one or more consumers for . . . damages. . .," Section 501.207(1)(c), Florida Statutes (1981). Before instituting judicial proceedings for declaratory judgment or for damages, however, "the enforcing authority shall, pursuant to an administrative hearing, determine that there is probable cause to bring the action." Section 501.207(2), Florida Statutes (1981).

   
   

8. The "enforcing authority" is the Department of Legal Affairs when a violation "occurs in or affects more than one judicial circuit or if the Office of State Attorney fails to act upon a violation within 90 days after a written complaint has been filed with the State Attorney. Section 501.203(4), Florida Statutes (1981). Where the violation occurs solely within or affects only a single judicial circuit, as here, the Office of the State Attorney is the "enforcing authority," whether the complaint is filed directly with the Office of the State Attorney or whether it is referred by the Department of Legal Affairs.

   
   

9. On the merits, the question is whether there has been "adequate proof of probable cause for the institution of a civil suit." Kasha v. Department of Legal Affairs, 375 So. 2d 43, 44 (Fla. 3d DCA 1979). The quantum of proof is less than a preponderance of the evidence. Id. There must be a showing only that there is reason to believe that respondents have been guilty of "unfair or deceptive acts or practices." Section 401.204(1), Florida Statutes (1981). This language has been held not to apply to real estate transactions, State ex rel. Herring v. Murdock, 345 So. 2d 759 (Fla. 4th DCA 1977), and certain

   provisions have been limited to "consumer transactions." Black v. Department of Legal Affairs, 353 So. 2d 655 (Fla. 2nd DCA 1977). Neither of these limitations pertain here. Respondent has filed no challenge to Rule 2-15.02, Florida Administrative Code, which specifically addresses home improvement contracts.

10. In construing the language "unfair or deceptive acts or practices," due consideration and great weight shall be

    given to the interpretations of the Federal

    Trade Commission and the federal courts relating to s. 5(1)(1) of the Federal Trade Commission Act (15 U.S.C. 45(a)(1)), as from

    time to time amended.

    Section 501.204(2), Florida Statutes (1981).

    
    

    The United States Supreme Court quoted with approval the following formulation by the Federal Trade Commission:

    
    

    1. whether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise--whether, in other words, it is within at least the penumbra of some common- law, statutory, or other established concept of unfairness; (2) whether it is immoral, unethical, oppressive, or unscrupulous; (3) whether it causes substantial injury to consumers (or competitors or other business- men). Statement of Basis and Purpose of Trade Regulation Rule 408, Unfair or Deceptive Advertising and Labeling of Cigarettes in Relation to the Health Hazards of Smoking.

       29 Fed Reg 8355 (1964).

       FTC v. Sperry & Hutchinson Co., 405 v. S. 233,

       244 n. 5 (1972). (quotation marks omitted.)

       
       

       The Department of Legal Affairs has adopted Rule 2-15.02, Florida Administrative Code, which provides:

       
       

       2-15.02 Home Improvement and Construction Contracts. It shall be an unfair or deceptive act or practice for any home improvement contractor (if the home improvement cost exceeds 100 dollars.)

       1. Fail to provide a written contract to the home buyer or home improvement buyer at the time of sale;

       2. Fail to provide an approximate con- struction completion date in the written contract unless the contract conspicuously discloses that no completion date is provided;

       3. Fail to fill in all the relevant blank spaces in the construction contract before

          it is signed by the buyer;

       4. Fail to include the contractor's name and address on the contract;

       5. Fail to include in the contract a description of the construction work to be performed;

       6. Fail to include in the contract all financing information as required by federal and state law; and

       7. Fail to include in the contract all warranty agreements of the contractor for the benefit of the buyer.

       The evidence adduced at final hearing and the stipulation of counsel establish probable cause to believe that respondent M. T. Motes was guilty of unfair and deceptive trade practices in his dealings with Rita Smith.

       
       

11. The evidence was insufficient to establish probable cause as to the corporate respondent. Mrs. Smith's testimony that she had the corporation's advertisement before she met Mr. Motes was clear but this chronology was the only link in the evidence between the corporation and Motes.

RECOMMENDATION

Upon consideration of the foregoing, it is RECOMMENDED:

1. That petitioner find probable cause to initiate judicial proceedings against respondent M. T. Motes pursuant to Section 501.207(1), Florida Statutes (1981).

   
   

2. That petitioner dismiss the administrative complaint filed against Mike's Painting and Contracting Company.

DONE and ENTERED this 3rd day of February, 1984, 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 3rd day of February, 1984.

COPIES FURNISHED:

William P. White, Jr., Esquire Assistant State Attorney

Post Office Box 12726 Pensacola, Florida 32501

Bruce A. McDonald, Esquire Emmanuel, Sheppard & Condon Post Office Drawer 1271 Pensacola, Florida 32596

Curtis A. Golden, State Attorney

First Judicial Circuit of Florida

Post Office Box 12726

190 Governmental Center Pensacola, Florida 32501

Docket for Case No: 83-002780

Orders for Case No: 83-002780