STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL ) REGULATION, FLORIDA REAL ) ESTATE COMMISSION, )

)

Petitioner, )

)

vs. ) CASE NO. 87-1392

)

FRED MARBERRY, JR. and )

BERNON EARL THOMAS, )

)

Respondents. )

)

RECOMMENDED ORDER

Final hearing in the above-styled action was held on May 29, 1987, in Orlando, Florida, before Mary Clark, Hearing Officer of the Division of Administrative Hearings.

The parties were represented as follows: For Petitioner: James R. Mitchell, Esquire

Division of Real Estate

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802

For Respondent, Robert D. Gatton, Esquire Fred Marberry, Maitland Center

Jr.: 1051 Winderley Place Maitland, Florida 32751

For Respondent, Bernon Earl Thomas, pro se Bernon Earl 4226 Match Point Drive Thomas: Augusta, Georgia 30909

BACKGROUND AND PROCEDURAL MATTERS

An Administrative Complaint was filed on March 4, 1987, alleging that the two Respondents violated certain provisions of Chapter 475, Florida Statutes, governing the real estate profession. Both Respondents elected to pursue their right to a formal administrative hearing.

At the hearing, the Petitioner ("Agency") presented the testimony of four witnesses and submitted eight exhibits, all received into evidence without objection, except for exhibit eight, which was received over the objection of Respondent Marberry ("Marberry"). Marberry testified in his own behalf and presented one additional witness and no exhibits. Respondent Thomas ("Thomas") testified in his own behalf and submitted one exhibit, received into evidence over the objection of Marberry.

After hearing and the preparation of a transcript, Marberry submitted Proposed Findings of Fact and Conclusions of Law. The eighty-nine (89) separate findings have been adopted here in abbreviated form. Most of the detail in those findings is cumulative and immaterial. Neither Petitioner nor Respondent Thomas submitted proposed findings.

ISSUE

The issue for determination in this proceeding is whether the Respondents violated Section 475.25(1)(b), Florida Statutes, by inducing a seller to enter in a contract for sale of real estate, based on a $50,000.00 earnest money deposit that was never made.

FINDINGS OF FACT

1. Respondent Fred Marberry, Jr. is now and was at all times material hereto a licensed real estate broker-salesman in the State of Florida, having been issued license number 0369879 in accordance with Chapter 475, Florida Statutes.

   
   

2. Respondent Bernon Earl Thomas is now and was at all times material hereto a licensed real estate salesman in the State of Florida, having been issued license number 0433736 in accordance with Chapter 475, Florida Statutes.

   
   

3. During the relevant time, from July through September 1985, Fred Marberry was President of Marberry and Mack Development, Inc., and maintained an office in Altamonte Springs, Florida. James Mack was the Vice-president, Secretary and Treasurer of the company.

   
   

4. During the relevant time, from July through September 1985, Bernon Thomas was a real estate salesman with General Realty Management Corporation. His office was in Kissimmee, Florida.

   
   

5. In 1985, the two Respondents had worked together on the potential sale and development of a multi-family project in Kissimmee. Thomas was aware of the availability of some commercial property in Kissimmee known as Cross Creek that he felt would be a good deal and shared that information with Marberry.

   
   

   Thomas got his information on Cross Creek from Larry Heninger, who was working with the owner, R. S. Futch, in putting together a development package to present to potential buyers and developers. Heninger had expended considerable effort in working with an engineer and permit agencies and had made contacts with a number of businesses interested in locating on the property.

   
   

   The engineering reports, correspondence and figures supplied to Marberry by Thomas indicated that the parcel comprised 14.75 usable acres. There were letters from the City saying that sewage capacity, utilities and similar public services would be based on this amount. Marberry told Thomas that the development package looked good and to continue working on it.

   
   

6. Some time in mid-July 1985, Larry Heninger informed Thomas that some third parties were also interested in the Cross Creek property and that if Marberry and Mack, Inc., wanted to present an offer, they would need to do so immediately as Mr. Futch was leaving on a vacation for several weeks. Thomas called Marberry to relay this information.

   The details of the conversation are in dispute, but it is uncontroverted that Thomas was made a Vice-president of Marberry and Mack, Inc., for the sole purpose of executing a sales contract immediately.

   
   

   Arrangements were made for Thomas to draw up the contract/offer and have it taken to the Orlando airport where R. S. Futch was either leaving or was en route on his vacation.

   
   

   Marberry and Thomas disagree on what was discussed with regard to an escrow deposit. Thomas contends that Marberry authorized him to provide for a

   $50,000.00 escrow deposit to be held by Fred Marberry, licensed real estate broker upon acceptance of contract. Marberry denies this and claims that he never maintained an escrow account, that escrow funds were always handled by his (Marberry's) attorney.

   
   

   Marberry claims that the day after signing, when he actually saw the contract, he said something to Thomas about his failure to delete the escrow language on the contract form. Thomas denies this.

   
   

   Both Marberry and Thomas agree that all parties should have known that the deposit could not be escrowed upon acceptance, since Marberry was not there for the signing.

   
   

7. The contract was prepared and signed by Thomas in Thomas' Kissimmee office and was taken to the Orlando airport.

   
   

   The contract, prepared on the standard Florida Bar and Association of Realtors approved form, provided a purchase price of $1,600,000.00, the

   $50,000.00 escrow deposit, and closing on August 25, 1985. The contract provided that closing could be extended by the buyer for 30 days with an additional $50,000.00 deposit.

   
   

   The contract contained the following special clauses:

   
   

   1. Contingent upon financing.

   2. Above described property of [sic] being viable to building Comm. Prop. with all necessary zoning and available utilities. [Pet. Ex. #5]

      
      

      At the airport, R. S. Futch accepted the offer by Marberry and Mack, made a few changes on the contract, initialled them and signed the contract; the changes were also initialled by Bernon Thomas. Later Thomas called Marberry and told him about the changes.

      
      

8. The morning after the contract was signed, Marberry and Thomas visited Heninger's engineer to review the project. They reviewed the engineering plans and learned that the property was in a floodplain. Drainage was a problem and parking was a problem and it appeared that only 4.3 acres was actually buildable.

   
   

   On leaving the engineer's office Marberry told Thomas that there was no way the project could work; they could never get financing for a $1.6 million parcel of 14.75 acres, with only 4.3 buildable acres. Marberry felt the contingencies in the contract could not be met and the contract was off.

   Thomas still believed in the project, and since he had already put so much time and effort in it, he wanted to keep working on pulling it together.

   Marberry did not dissuade him, but said only to keep him informed on what was going on.

   
   

9. Thomas told Heninger that Marberry didn't want the contract. Heninger said he wanted the contract to stay intact and encouraged Thomas to keep working on it. He also tried to get Thomas to do the deal himself, but Thomas told him he did not have the funds. Thomas claims that Heninger told him not to worry about the $50,000.00; Heninger denies this. Nothing was communicated in writing regarding the contract being terminated.

   
   

   The $50,000.00 deposit was never made.

   
   

10. The deadline for closing passed, and sometime in September 1985, Larry Heninger arranged a meeting between R. S. Futch and Fred Marberry in a motel in Orlando. The purpose of the meeting was to either extend the contract entered in July (according to R. S. Futch), or to negotiate a new contract for the property (according to Fred Marberry).

    
    

    During the meeting Futch was told that no $50,000.00 deposit had been made on the original contract. The meeting apparently terminated and shortly later Futch filed suit for the $50,000.00.

    
    

11. The testimony of the principal witnesses in this case: Marberry, Thomas, Futch and Heninger, establish a picture of lack of communication, misunderstanding, bungling, and unprofessionalism. It is impossible to determine from the rambling and disjointed stories of these witnesses, that either Fred Marberry or Bernon Thomas, individually or together, engaged in "fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, and breach of trust..."

    
    

    CONCLUSIONS OF LAW

    
    

12. The Division of Administrative Hearings has jurisdiction over the parties and subject matter of in this case. Section 120.57(1), Florida Statutes, and Section 455.225(4), Florida Statutes.

    
    

13. The sole violation with which Respondents were charged is Section 475.25(1)(b), Florida Statutes, which provides that a license may be disciplined if the licensee:

    
    

    (b) Has been guilty of fraud, misrepresen- tation, concealment, false promises,

    false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or 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 or by the terms of a listing contract, written, oral, express, or implied, in a real estate transaction; has aided, assisted, or conspired with any other person engaged in any such misconduct and in furtherance thereof; or has formed an

    intent, design, or scheme to engage in any such misconduct and committed an overt act in furtherance of such intent, design, or scheme. It is immaterial to the guilt of the licensee that the victim or intended victim of the misconduct has sustained no damage or loss; that the damage or loss has been settled and paid after discovery of the misconduct; or that such victim or intended victim was a customer or a person in confidential relation with the licensee or was an identified member of the general public.

    
    

14. Petitioner failed to produce evidence, "clear and convincing," that this violation occurred. See Ferris v. Turlington, 12 FLW 393 (Fla. S.Ct. opinion filed July 16, 1987).

RECOMMENDATION

Based on the foregoing, it is hereby, RECOMMENDED:

That the Administrative Complaint against both Fred Marberry and Bernon Thomas, be dismissed.

DONE and ORDERED this 11th day of August, 1987, in Tallahassee, Florida.

MARY CLARK

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 11th day of August, 1987.

COPIES FURNISHED:

James R. Mitchell, Esquire Division of Real Estate

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802

Robert D. Gatton, Esquire Maitland Center

1051 Winderley Place

Maitland, Florida 32751

Bernon Earl Thomas 4226 Match Point Drive

Augusta, Georgia 30909

Van Poole, Secretary Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32399-0750

Joseph A. Sole, Esquire General Counsel

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32399-0750

Harold Huff, Executive Director Division of Real Estate

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802

Docket for Case No: 87-001392

Orders for Case No: 87-001392