STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL ) REGULATION, DIVISION OF REAL ) ESTATE, )

)

Petitioner, )

v. ) CASE NO. 85-2333

)

RICHARD KONDIAN, )

)

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 October 14, 1985, in Fort Lauderdale, Florida.

APPEARANCES

For Petitioner: Arthur R. Shell, Jr. ,Esquire

Post Office Box 1900 Orlando, Florida 32802

For Respondent: No appearance.

BACKGROUND

By administrative complaint filed on May 10, 1985, petitioner, Department of Professional Regulation, Division of Real Estate, has charged that respondent, Richard Kondian, licensed by petitioner as a non-active salesman, had violated Subsection 475.25(1)(b), Florida Statutes. Generally, petitioner has alleged that on July 24, 1984, respondent, using the ficticious name "Dick Como", solicited and obtained a contract to repair a fire damaged residence for $18,150.00, that the company which respondent represented would do the work was non- existent, that the repair work has never been completed, and that despite demands by the homeowners for a refund of their money, respondent has ignored their requests. Petitioner contends that this conduct constitutes fraud, misrepresentation,

concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction within the meaning of Subsection 475.25(1)(b), Florida Statutes.

Respondent disputed the allegations and requested a formal hearing pursuant to Section 120.57(1), Florida Statutes. The matter was referred to the Division of Administrative Hearings by petitioner on July 11, 1985, with a request that a Hearing Officer be assigned to conduct a final hearing. By notice of hearing dated July 26, 1985, the final hearing was scheduled for August 15, 1985 in Fort Lauderdale, Florida. At the request of petitioner, the hearing was rescheduled to October 14, 1985 at the same location.

At final hearing, petitioner presented the testimony of Michael Derhagopian and offered petitioner's exhibits 1 and 2. Both were received in evidence. Petitioner was also allowed to late- file the depositions of James E. and Janis Shand, who failed to honor their subpoenas and appear at final hearing.

These depositions were filed on November 14, 1985.

The transcript of hearing was filed on November 12, 1985.

Proposed findings of fact and conclusions of law were not filed by either party.

At issue herein is whether respondent's real estate license should be disciplined for the alleged violations set forth in the administrative complaint.

Based upon all of the evidence, the following facts are determined:

FINDINGS OF FACT

1. At all times relevant hereto, respondent, Richard Kondian, was a licensed real estate salesman having been issued license number 0302230 by petitioner, Department of Professional Regulation, Division of Real Estate. The license is currently in

   an inactive status. His present address is 300 South Pine Island Road, Plantation, Florida.

   
   

2. In July, 1984, James E. and Janis Shand, who lived at 4940 S. W. 16th Street, Fort Lauderdale, Florida, suffered extensive fire damage to their residence. Respondent approached the Shands, introduced himself as Dick Como, and offered to

   repair their home to its original condition. He also represented himself to be a contractor and that he was a principal in Apex Roofing, a local contracting firm. The Shands agreed to permit Kondian (Como) to perform the work, and they executed a contract prepared by Kondian on an "Apepco Corp." letterhead which authorized the work. A copy of the contract has been received in evidence as petitioner's exhibit 2. The document is a photostatic copy of the original, and is only partially legible. It does reflect July 24, 1984 as being the date of execution, and describes the repairs to be made as follows:

   
   

   To be effected to return Property to Pre- Fire Condition as per policy. (No extra charge to Home.)

   
   

   It also authorizes Allstate Insurance Company to pay for the repairs in accordance with the terms of the Shands' insurance policy. The contract was accepted by "D. Como." Como and Kondian were identified by the Shands as being one and the same.

   
   

3. The owner of Apex Roofing and Insurance Repair Corporation was Michael Derhagopian, a licensed roofing contractor in Dania, Florida. Respondent told Derhagopian that he had procured a repair job on the Shands' residence and that he desired Apex to do the roofing portion of the work, and that a general contractor would perform the remainder of the project. He also advised Derhagopian that he needed to use Apex Roofing as the licensee on the project. Derhagopian agreed to do the work and pulled a permit for the roofing work. He also opened a checking account in which the insurance proceeds from Allstate were to be deposited. Both he and respondent had authorization to sign checks drawn on that account.

   
   

4. On September 24, 1984, Allstate Enterprises Mortgage Corporation issued a check payable to Apex Roofing and Insurance and J. E. Shand in the amount of $18,150.66. The check was issued for the purpose of enclosing the house, cleaning it, and installing a new roof, trusses and windows. The check was endorsed by both the Shands and Richard Kondian who 'indicated on the endorsement that he was president of Apex. The check was then deposited into the Derhagopian Kondian joint account.

   
   

5. Work began on the Shands' residence in September, 1984. Derhagopian completed a small flat deck in the rear of the house, and the general contractor began stripping the inside of the house and cleaning the premises. When neither was paid by

   Kondian they ceased work on the project. At that time Derhagopian learned that Kondian had spent the entire $18,150.66 within a week. According to Derhagopian, Kondian spent around

   $5,000.00 on a "nursing home" transaction, $500.00 for legal expenses, and an undisclosed amount for mortgage payments on his home. It is not known how the remainder of the funds were spent except that they were not used for their intended purpose of repairing the Shands' home. Despite demands for repayment of their monies, Kondian has never repaid the Shands.

   
   

6. The Shands eventually had their home repaired, but still have liens on it to this date. They have pending a civil action against Kondian to recover the insurance proceeds.

   
   

   CONCLUSIONS OF LAW

   
   

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

   
   

8. For his dealings with the Shands, Kondian is charged with being guilty of fraud, misrepresentation, conceal meet, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction as proscribed by Subsection 475.25(1)(b), Florida Statutes.

   
   

9. The evidence clearly and convincingly establishes that under false pretenses (by using a ficticious name) Kondian obtained substantial insurance proceeds ($18,150.66) for the purpose of repairing the fire- ravaged home of the Shands. He improperly diverted these funds to other purposes and failed to return these monies to the Shands despite requests to do so. By doing this, Kondian is guilty of fraud (which is inferred from the evidence), misrepresentation (as to how the money would be used), concealment (of the use of the monies), false promises (to the Shands), dishonest dealing by trick, scheme or device (which is apparent from the facts), and breach of trust in a business transaction (with the Shands). While Kondian was not acting in the capacity of a real estate salesman when these transgressions transpired, that in itself is no bar to disciplinary action. Sellars v. Florida Real Estate Commission

   380 So. 2d 1052 (Fla. 1st DCA 1979) (licensee may be disciplined for his dishonest conduct of business affairs for his own account).

10. Given the nature of the violation, revocation of Kondian's license is appropriate.

RECOMMENDATION

Based on the foregoing, it is

RECOMMENDED that respondent be found guilty of violating Subsection 475.25(1)(b), Florida Statutes, and that his license number 0302230 be REVOKED.

DONE and ORDERED this 16th day of December, 1985, in Tallahassee, Florida.

DONALD R. ALEXANDER

Hearing Officer ~

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, FL 32301

(904 ) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 16 day of December, 1985.

COPIES FURNISHED:

Mr. Richard Kondian

300 South Pine Island Road Plantation, FL 33324

Arthur R. Shell, Jr., Esq.

P. O. Box 1900 Orlando, FL 32802

Docket for Case No: 85-002333

Orders for Case No: 85-002333