STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA REAL ESTATE COMMISSION, )

)

Petitioner, )

)

vs. ) Case No. 85-4365

)

J. LEONARD DIAMOND, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to the Notice of Hearing furnished the parties by the undersigned on January 20, 1986, a hearing was held in this case before Arnold H. Pollock, a Hearing Officer with the Division of Administrative Hearings at the Federal Corrections Institute, Eglin Air Force Base Federal Prison Camp, Florida on February 7, 1986.

APPEARANCES

For Petitioner: Sue Hartman, Esquire

Division of Real Estate

Department of Professional Regulation

400 W. Robinson Street Orlando, Florida 32801

For Respondent: J. Leonard Diamond, pro se #12936-004

Post Office Box 800

Eglin Air Force Base, Florida 32542 ISSUE

The issue for consideration was whether Respondent's license as a real estate salesman in Florida should be disciplined because of the alleged misconduct outlined in the Administrative Complaint filed herein.

BACKGROUND INFORMATION

On August 28, 1985, Fred Roche, Secretary of the Department of Professional Regulation, on behalf of the Florida Real Estate Commission, filed an Administrative Complaint in this case

charging Respondent with five Counts of violations of Section 475.25(1), Florida Statutes, including fraud in business transactions, conviction of a crime involving fraudulent dealing, being confined in a Federal prison, and failing to notify the Florida Real Estate Commission of his conviction in writing. The Respondent, by letter dated December 10, 1985, admitted the majority of the allegations contained in the Administrative Complaint with the exception of the allegation involving wire fraud and requested a formal hearing. Thereafter, the file was forwarded to the Division of Administrative Hearings for appointment of a Hearing Officer.

The hearing was initially set for February 6, 1986. At the appointed time and date, the undersigned and Respondent were present for hearing. However, counsel for Petitioner failed to appear due to reported travel difficulties and the hearing was rescheduled for the following day at which it proceeded without further delay.

At the hearing, Petitioner introduced Petitioner's Exhibits

1 through 3. Petitioner's Exhibits 4 and 5 for Identification were not admitted. No witnesses testified for Petitioner. Respondent presented no evidence in his own behalf.

Neither party submitted proposed Findings of Fact.

FINDINGS OF FACT

1. Respondent Diamond was licensed as a real estate salesman in Florida on November 4, 1957. On April 1, 1978, he renewed his salesman's license in a "non-active" status. Renewal has not been sought again by Respondent nor has any renewal of the license, in any fashion, been accomplished by Petitioner. Respondent has not been notified of the status of his license since March 31, 1980.

   
   

2. On or about November 16, 1983, an indictment was filed in the United States District Court for the Southern District of Florida against Respondent and others alleging 48 counts of mail and wire fraud involving the sale of advisory contracts relating to oil and gas leasing operations under the Federal SIMOL program. On November 23, 1983, Respondent was arraigned before United States Magistrate Peter R. Palermo and entered a plea of Not Guilty to the charges laid against him.

3. The indictment in question related to the Respondent in

   18 of the 48 Counts. On February 8, 1985, as a result of a trial by jury, Respondent was found guilty of 7 of the 18 Counts laid against him specifically and not guilty of the remaining 11 Counts which related to him. Review of the pertinent Counts of

   which Respondent was found guilty reflects that these allegations, notwithstanding the terms of the Administrative Complaint filed herein, relate specifically and exclusively to mail fraud only. There is no evidence that Respondent was found guilty of wire fraud.

   
   

4. From the date of the conviction up until January 31, 1986, Respondent failed to notify the Florida Real Estate Commission in any way of his conviction as stated above.

   
   

5. Respondent admits all the allegations contained in the Administrative Complaint which relate to his guilt of and conviction for mail fraud in his letter requesting hearing in response to the Administrative Complaint.

   
   

6. On April 9, 1985, Respondent was sentenced to 2 years imprisonment on each of the 7 counts of which he was found guilty each term to run concurrently, and was ordered to serve his sentence in the Eglin Federal Prison Camp at Eglin AFB, Florida.

   
   

   CONCLUSIONS OF LAW

   
   

7. Under the provisions of Section 475.183(3), Florida Statutes (1979):

   
   

   "Any license which is inactive for more than

   10 years shall automatically be suspended. One-year prior to the suspension the department shall give notice to the licensee. A suspended license may be reinstated as provided in Section 475.25."

   
   

8. In 1983, the Legislature changed the 10 year provision cited above to provide:

   
   

   "Any such [inactive] license which has been inactive for more than 4 years shall automatically expire if the licensee has not made application for renewal of such license. Once a license expires, it becomes null and void without any further action by the board or department. One year prior to the license, the department shall give notice to the licensee."

   
   

9. Section 108, Chapter 83-329, Laws of Florida, 1983 provides:

   
   

   "Any licensee whose license is inactive on the effective date of this act [October 1,

   1983] may retain inactive status for 4 years beginning from the date of the next biennial review whereupon such inactive license shall expire, if no re-activation or renewal of the inactive license has occurred "

   
   

10. A casual reading of the provisions of the 1983 statute, without reference to the additional "grandfather" clause in Chapter 83-329, might give the incorrect impression that jurisdiction to take action here had expired. However, reference to that additional provision extending inactive status for that class of licensee which includes the Respondent here, clarifies. the situation. Therefore, it is clear that the Division of Administrative Hearings has jurisdiction over the parties and the subject matter of these proceedings.

    
    

11. In addition to the allegations involving mail fraud to which the Respondent has admitted, the Administrative Complaint, in Count V, alleges that during the period February 1981 through July 1983, Respondent acted in the State of California as a mineral, oil or gas broker without having a mineral, oil, or gas broker's license issued by that state; that he aided individuals in filing applications for the lease of oil or gas property owned by the United States government; and that as a result of this action, the California Department of Real Estate issued two Orders to Desist and Refrain regarding that conduct. Respondent objected to the admissibility of the two Orders. One, relating to U.S Oil and Gas Corporation, referred to Respondent only as Resident Agent and not as a party. The second, relating to the Stratford Company, in which Respondent was an officer, relates strictly to operating without a license which is irrelevant to any allegation of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or devise, culpable negligence, or breach of trust in a business transaction as alleged in Count V of the Administrative Complaint. As a result, Respondent's objection to the admission of both Orders was sustained.

12. With regard to the remaining allegations relating to the Federal conviction, clearly the Respondent's conduct constitutes fraud and misrepresentation in a business transaction as is prohibited in Section 475.25(1)(b). Respondent was convicted of at least seven counts of fraud or dishonest dealing which is a violation of Section 475.25(1)(f). Respondent has been and is confined in a Federal prison in violation of Section 475.25(1)(p).

    
    

13. Having established, then, that the majority of the allegations contained in the Administrative Complaint have been proven and support disciplinary action against Respondent's

license, the question remaining is what action is appropriate. Here the evidence clearly shows that the Respondent's misconduct is substantial and indicates a lack of trustworthiness. It is clear that Respondent is ill equipped to hold a real estate license in this state. Since he has failed to renew his license after its expiration for a period of years, it is obvious that he does not consider it to be a highly valued commodity.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore

RECOMMENDED that Respondent J. LEONARD DIAMOND's license as a real estate salesman in the State of Florida be revoked.

RECOMMENDED this 7th day of March, 1986, in Tallahassee, Florida.

ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 7th of March, 1986.

COPIES FURNISHED:

Sue Hartman, Esquire Division of Real Estate Department of Professional

Regulation

400 W. Robinson Street Orlando, Florida 32801

Harold Huff, Exec. Director Division of Real Estate Department of Professional

Regulation

400 W. Robinson Street Orlando; Florida 32801

J. Leonard Diamond #12936-004

P. O. Box 800

Eglin AFB, Florida 32542

Docket for Case No: 85-004365

Orders for Case No: 85-004365