STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL )

REGULATION, FLORIDA REAL )

ESTATE COMMISSION )

)

Petitioner, )

)

vs. ) CASE NO. 84-3706

)

BRIAN H. MORGENSTERN, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, William J. Kendrick, held a public Hearing in the above-styled case on December 6, 1984, at Miami, Florida.

APPEARANCES

For petitioner: Fred Langford, Esquire

Department of professional Regulation Post Office Box 1900

Orlando, Florida 32802

For Respondent: Brian H. Morgenstern, pro se

7436 Gary Avenue

Miami Beach, Florida 33141 PRELIMINARY STATEMENT

By Administrative Complaint filed with the Division of Administrative Hearings October 23, 1984, Petitioner, Department of Professional Regulation, charges Respondent with a violation of Subsection 475.25(1)(b),(d), and (k), and 475.42(1)(b) Fla. Stat.

At the final bearing Petitioner called Craig Brass, D.C., Ira Messinger, Kenneth Rehm, and Brian H. Morgenstern, as witnesses. Petitioner offered Exhibits I through 4, and they were received into evidence. Respondent testified on his own behalf and offered Exhibits 2 and 3, which were received into evidence. No findings of fact and conclusions of law were filed on behalf of either party.

FINDINGS OF FACT

1. Respondent, Brian H. Morgenstern, holds and at all times material hereto held, Florida Real Estate Salesman's License No. 0320190.

2. From February 4, 1983 to December 2, 1983, Respondent was licensed as a real estate salesman in the employ of E & I Realty, Inc. Mr. Ira Messinger was the qualifying broker for E & I Realty, Inc.

   
   

3. On July 12, 1983, Respondent, purporting to act on behalf of E & I Realty, Inc., solicited and obtained a two-year lease agreement between Craig Brass, lessor, and James Joss, lessee, for condominium unit No. 705, Towers of Oceanview, 400 Leslie Drive, Hallandale, Florida. Pursuant to the express terms of the lease agreement, the lessee agreed to pay a monthly rental of $450.00 for the first year, and a monthly rental of $475.00 for the second year.

   
   

4. In consideration for securing the lease agreement, Dr. Brass agreed to pay a broker's fee of $925.00, representing one month's rent for the first and second year of the term.

   
   

5. Respondent delivered an E & I Realty receipt to Dr. Brass evidencing the receipt of the first month's rent, the last month's rent, and a security deposit, for a total sum of $1,375.00. From this $1,375.00 the receipt evidenced a deduction of $925.00 as a broker's fee, and delivery of the balance of $450.00 to Dr. Brass.

   
   

6. There is disagreement between the parties whether the Respondent actually received $1,375.00 from Mr. Joss. Respondent insists that Mr. Joss, an acquaintance, could only raise $450.00 so be and Mr. Messinger "agreed" to forego receipt of the broker's fee of $925.00 and, in effect, loan such sum to Mr. Joss. There is, however, no promissory note or other memoranda to commemorate such an agreement.

   
   

7. Mr. Messinger insists that his office made no such agreement, that he had no knowledge of the transaction, and that no monies were ever received by his office.

   
   

8. Dr. Brass testified to a conversation on a speaker phone between Mr. Joss and the Respondent wherein the Respondent admitted receiving the funds. Further, Kenneth Rehm, an investigator for the Department of Professional Regulation, personally interviewed Respondent and the Respondent admitted he had collected the full $1,375.00 and that be had retained $925.00 as a broker's fee.

   
   

9. Respondent further insists that his version of the incident is given credence by the commission structure he had with Mr. Messinger. Under their agreement, Respondent was to receive 90 percent of any commission earned on business he produced. Therefore, Respondent argues, it would be "foolish" for him to risk his license for $92.50 (10 percent of the $925.00 commission). While Respondent's argument appears at first blush to have merit, the value of money is relative. On February 23, 1984, Respondent entered into a written agreement with Dr. Brass to pay him $350.00 within 17 days in consideration of which Dr. Brass would not file any complaints with anyone, including the Department of Professional Regulation. Respondent did not have the funds necessary to pay Dr. Brass, and in point of fact has never paid Dr. Brass. If

   Respondent did not have $350.00 to circumvent these proceedings, then $92.00 may well have been of import to him.

   
   

10. The clear and consistent testimony of Dr. Brass, Ira Messinger, and Kenneth Rehm, Respondent's conflicting statements and testimony together with his demeanor, render Respondent's testimony inherently improbable and unworthy of belief.

11. Accordingly, the Hearing Officer finds that the Respondent did in fact receive $1,375.00 from Mr. Joss, that he delivered $450.00 to Dr. Brass, and retained $925.00 for his own use and benefit without the knowledge or consent of his registered broker.

    
    

    CONCLUSIONS OF LAW

    
    

12. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

    
    

13. The allegations in this case are that Respondent, Brian H. Morgenstern, violated Subsection 475.25(1)(b), (d), and (k) and 475.42(1)(b), Fla.Stat.

    
    

14. Section 475.25(1) provides, in pertinent part:

    
    

    1. The commission . . . may suspend a license or permit for a period not exceeding 10 years; may revoke a license or permit; may impose an administrative fine not to exceed $1,000 for each count or separate offense; and may issue a reprimand, or any or all of the fore- going, if it finds that the licensee, permittee, or applicant:

       1. Has violated any provision of

          s.475.42 or of s.455.227(1).

       2. Has been guilty of fraud, mis- representation, concealment, false promises, false pretenses, dishonest dealing by

       trick, scheme, or device, culpable negli- gence, breach of trust in any business transaction in this state or any other state, nation, or territory; has violated a duty imposed upon him by law. . . .

       * * *

       (d) Has failed to account or deliver to any person, including a licensee under this chapter, at the time which has been agreed upon or is required by law . . .

       any personal property such as money ,

       including a share of a real estate commission, or any secret or illegal profit

       . . . which has come into his hands. . . .

       * * *

       (k) . . .has failed, if a salesman, to immediately place with his registered employer any money, fund, deposit, check, or draft entrusted to him by any person dealing with him as agent of his registered employer. . . .

       
       

15. Section 475.42(1)(b) provides:

    
    

    (b) No person licensed as a salesman shall operate as a broker or operate as a salesman for any person not registered as his employer.

16. Petitioner has established, by clear and convincing evidence, that Respondent has violated Subsection 475.25(1)(b)(d), and (k), and 475.42(1)(b), Fla.Stat. Respondent, by trick or artifice, misled Dr. Brass to believe that Respondent was acting on behalf of E & I Realty, Inc., when in fact, be was acting for his own account. Further, Respondent failed to account or to deliver the monies he received from Mr. Joss to his registered employer, but, rather, retained said sums for his own use and benefit without the knowledge or consent of his registered broker.

17. Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a Final Order be entered holding Respondent in violation

of Subsection 475.25(1)(b), (d), and (k), and 475.42(1)(b), Fla.Stat., that an

administrative fine in the sum of five hundred dollars ($500.00) be imposed against the Respondent, Brian H. Morgenstern, and that the real estate salesman's license of Respondent, Brian H. Morgenstern, be suspended for a period of six (6) months.

DONE AND ENTERED this 8th day of January, 1985, at Tallahassee, Florida.

WILLIAM J. KENDRICK

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 8th day of January, 1985.

COPIES FURNISHED:

Fred Langford, Esquire Department of Professional

Regulation

Post Office Box 1900 Orlando, Florida 32802

Brian H. Morgenstern 7436 Gary Avenue

Miami Beach, Florida 33141

Harold Huff, Executive Director Division of Real Estate Department of Professional

Regulation

Post Office Box 1900 Orlando, Florida 32802

Fred M. Roche, Secretary Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

Docket for Case No: 84-003706

Orders for Case No: 84-003706