STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS REGULATION, ) DIVISION OF ALCOHOLIC BEVERAGES ) AND TOBACCO, )

)

Petitioner, )

)

vs. ) CASE NO. 87-4483

) MAXIMILLIANO N. GONZALES, d/b/a ) LOS AMIGOS BAR, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the above matter was heard before the Division of Administrative Hearings by its duly designated Hearing Officer, Donald R. Alexander, on October 15, 1987 in Miami, Florida.

APPEARANCES

For Petitioner: Thomas A. Klein, Esquire

725 South Bronough Street Tallahassee, Florida 32399-1020

For Respondent: Jose M. Herrera, Esquire

Post Office Box 345118

Coral Gables, Florida 33114 BACKGROUND

By Notice to Show Cause issued on October 8, 1987, petitioner, Department of Business Regulation, Division of Alcoholic Beverages and Tobacco, alleged that respondent, Maximilliano N. Gonzales, d/b/a Los Amigos Bar, had violated Section 561.29, Florida Statutes (1985) in twenty-one respects. For this, the agency proposed to take disciplinary action against respondent's Series 2-COP alcoholic beverage license. Also issued on October 8 was an Emergency Order of Suspension which suspended respondent's license on an emergency basis.

On October 9, 1987, respondent requested an expedited formal hearing to contest the allegations in the Notice to Show Cause pursuant to Subsection 120.57(1), Florida Statutes (Supp. 1986). In so doing, he waived his right to have fourteen days written notice prior to hearing. The matter was referred by petitioner to the Division of Administrative Hearings on October 9, 1987, with a request that a hearing officer be assigned to conduct a formal hearing.

By notice of hearing already embodied in the agency Notice to Show Cause, the matter was scheduled for final hearing on October 15, 1987, in Miami, Florida. At final hearing the parties stipulated that the factual allegations in the Notice to Show Cause and Emergency Order of Suspension were true and

correct. Petitioner presented the testimony of beverage officers Oscar Santana, Hector Garcia and Beverly Jenkins. Respondent testified on his own behalf, presented the testimony of Olga Pernis and Wilfredo Montero, and offered respondent's composite exhibit 1 which was received in evidence.

There is no transcript of hearing. Petitioner and respondent filed proposed findings of fact and conclusions of law on October 26 and 28, 1987, respectively. A ruling on each proposed finding is made in the Appendix attached to this order.

The issue is whether respondent is guilty of the allegations in the Notice to Show Cause and should have his alcoholic beverage license disciplined.

Based upon all of the evidence, including the stipulation of counsel, the following findings of fact are determined:

FINDINGS OF FACT

1. Introduction

   
   

   1. Respondent, Maximilliano N. Gonzales (respondent or Max) is the holder of alcoholic beverage license number 23-04935, Series 2-COP, issued by petitioner, Department of Business Regulation, Division of Alcoholic Beverages and Tobacco (Division). The license is used in conjunction with the operation of a lounge known as the Los Amigos Bar (bar or lounge) located at 5 Southwest 55th Avenue, Miami, Florida.

      
      

   2. Respondent and his companion, Olga, purchased the lounge in January, 1983 and have operated it since that time. Generally, either Max or Olga is on the premises supervising operations although Max was seriously injured by a customer about a year ago while breaking up an altercation and was forced to curtail his activities. Consequently, he has hired several other persons to assist him in managing the lounge during 1987.

      
      

   3. In the summer of 1987, the Division received a list of fifty Miami area establishments where the City of Miami police department suspected illicit drug transactions were taking place. RespondeV bar was one of these establishments. As a part of its investigation, the Division sent two undercover investigators (Garcia and Santana) to the lounge on August 21, 1987 to ascertain whether the police department's suspicions were well- founded. The two visited the bar on a recurring basis until October 8, 1987 when the Division issued an Emergency Order of Suspension which shut down the lounge and suspended respondent's license. That prompted the case sub judice.

      
      

   4. During their seven week investigation, Santana and Garcia observed a number of open and flagrant drug transactions and other illicit acts taking place on the licensed premises. In accordance with the parties' stipulation, these acts are summarized in chronological order in the findings below. For purposes of this order, Roberto was a patron of the bar, Carlos was its manager, and Loreno, Rosa, Lourdes, Eliza and Genny were barmaids. Further, all employees were on duty when the events herein occurred.

      
      

2. The investigation

   
   

   1. While visiting the lounge on or about September 2, 1987, Santana and Garcia were approached by Lorena and Roberto and asked if they wished to purchase some cocaine. The investigators told Roberto that they would each be

      interested in purchasing a half gram of cocaine. Roberto then left the licensed premises and returned shortly thereafter and handed each investigator a half gram packet containing what appeared to be cocaine, a controlled substance.

      Garcia paid Roberto sixty dollars for both packets. The transaction took place "in front of the bar" and in the presence of Lorena and Rosa. The substance purchased was sent to a laboratory where an analysis confirmed it to be cocaine.

      
      

   2. On another visit to the lounge on or about September 4, 1987, Santana and Garcia were approached by Roberto concerning a purchase of cocaine. Garcia told Roberto he and Santana wished to order a half gram each. Roberto left the licensed premises and returned a few minutes later. He handed Garcia two small packets containing what appeared to be cocaine. Garcia then paid Roberto sixty dollars for both packets. The transaction took place in plain view while the investigators were seated at the bar and in the presence of Rosa. The substance purchased was subsequently sent to a laboratory where an analysis confirmed it to be cocaine.

      
      

   3. While at the premises on September 4, Santana and Garcia heard Roberto ask Rosa in a loud voice if she wanted to purchase some cocaine. A short (but loud) conversation between Roberto and Rosa then ensued while in the presence of approximately ten patrons and three other barmaids. Throughout the same evening, several patrons were observed purchasing what appeared to be cocaine from Roberto inside the licensed premises.

      
      

   4. On or about September 8, 1987, Santana and Garcia observed Roberto selling what appeared to be cocaine to numerous patrons inside the licensed premises. The investigators were later approached by Roberto who asked if they wished to purchase the drug. After Santana responded that he wished to buy some, Roberto handed him two packets containing what appeared to be cocaine in exchange for sixty dollars. The transaction took place in plain view at the bar and in the presence of Lorena, Lourdes and Eliza. In addition, Carlos was on the licensed premises when these activities occurred. The substance purchased by the investigators from Roberto was thereafter sent to the laboratory for analysis and was found to be cocaine.

      
      

   5. On or about September 10, 1987, while on the licensed premises, Santana and Garcia were approached on two occasions by Lourdes and Genny who solicited drinks from the officers. The investigators then went to the parking lot of the licensed premises, and were approached by Roberto concerning a purchase of cocaine. After Santana responded that he wished to buy some, Roberto handed Santana two small packets containing what appeared to be cocaine in exchange for fifty dollars. The substance was later laboratory analyzed and found to be cocaine.

      
      

   6. After entering the premises on or about September 14, 1987, the investigators were immediately approached by Lourdes who solicited the officers for an alcoholic beverage. They were later solicited in the same fashion by Genny. Later on, Santana met with Roberto and Rosa and asked if he could buy some cocaine. Santana handed Roberto sixty dollars and returned to his seat at the bar. Shortly thereafter, Roberto approached the investigators at the bar and handed Santana two small packages containing what appeared to be cocaine. The transaction took place in plain view at the bar and in the presence of Rosa and Genny. The substance purchased was laboratory analyzed and found to be cocaine.

      
      

   7. On or about September 17, 1987, the investigators returned to the lounge and met with Eliza concerning a purchase of cocaine. Eliza approached a

      patron who was seated at the other end of the bar and briefly conversed with him. Eliza returned to the investigators and told them that she could obtain cocaine for sixty dollars per gram, and that the cocaine would be delivered to the bar in approximately thirty minutes. Some thirty minutes later, Roberto entered the lounge and approached the investigators and asked if they desired to buy the drug. Santana told him he was interested in such a purchase and handed Roberto sixty dollars in exchange for two small packets containing what appeared to be cocaine. The packets were delivered on top of the bar counter in plain view and in the presence of Eliza and Lourdes. The substance purchased was laboratory analyzed and found to be cocaine.

      
      

   8. While at the lounge on September 17, Genny solicited two drinks from Santana. The two investigators also had extensive conversations with Eliza regarding the purchase of cocaine.

      
      

   9. On or about September 21, 1987, Santana and Garcia met with the manager, Carlos, concerning the purchase of cocaine from Roberto. During the conversation, Carlos was told several times that the investigators had purchased cocaine from Roberto inside the licensed premises. Carlos merely responded that "Roberto is a good guy, but he is not here." At no time did Carlos express disapproval of the cocaine transactions occurring within the licensed premises.

      
      

   10. On the same visit, barmaid Genny solicited two drinks from the investigators. The investigators also had conversations with Genny regarding the availability of cocaine on the licensed premises. However, they were informed by her that Roberto had not yet arrived.

       
       

   11. On or about September 22, 1987, Santana and Garcia visited the lounge and were approached by Eliza who asked whether they wished to purchase some cocaine. Eliza also informed them that Roberto had instructed her to call him on his beeper if any of his "regular customers" needed to purchase cocaine. She added that if Roberto could not come to the bar, she could sell them drugs obtained from her source who was present at the bar. After Santana and Garcia told her that they were interested in purchasing cocaine,, Eliza took a quarter from the business cash register and placed a telephone call on the lounge telephone. Eliza then returned and informed them that Roberto was on his way to the bar. A few minutes later, Roberto entered the lounge, approached the investigators, and handed Garcia two small packages containing what appeared to be cocaine. For this, Garcia gave Roberto fifty dollars. The transaction took place in plain view at the bar and in the presence of Eliza and Carlos. The substance purchased was sent to the laboratory where an analysis confirmed the substance to be cocaine. It is also noted that on this same visit, Genny solicited a drink from the investigators.

       
       

   12. On or about September 24, 1987, Santana and Garcia returned to the bar and were approached by Eliza who asked if they wished to purchase cocaine. She again informed them that Roberto had instructed her to call him on his beeper should the investigators wish to make a purchase. After Santana and Garcia placed an order for cocaine, Eliza went to the public telephone inside the licensed premises, and made a telephone call. After she returned she advised them that Roberto would be arriving soon. Approximately twenty minutes later, Roberto arrived at the licensed premises and told them that he had the cocaine that they had ordered. Roberto then gave Santana one gram of a substance that appeared to be cocaine in exchange for sixty dollars. He also handed Garcia

       one-half gram of a substance appearing to be cocaine in exchange for thirty dollars. The two transactions took place in plain view in the bar and in the

       presence of Eliza and Carlos. The substances purchased were laboratory analyzed and found to be cocaine. During this same visit, Genny solicited a drink from the investigators.

       
       

   13. On or about September 28, 1987, the two investigators returned to the lounge and were approached by Eliza and Genny who asked if they were interested in purchasing some cocaine. Eliza told them that Roberto was not in the bar but that she could call him on his beeper. Garcia requested that Eliza telephone Roberto and order a gram of cocaine. Eliza left for a few moments and was observed making a telephone call inside the licensed premises. A few minutes later, Roberto entered the lounge and handed Garcia two small packets containing what appeared to be cocaine. For this, Garcia gave Roberto fifty dollars. The transaction took place in plain view at the bar and in the presence of Eliza and Genny. The purchased substance was laboratory analyzed and found to be cocaine.

       
       

   14. On the same visit, Santana asked Roberto if he could purchase a gram of cocaine. Roberto said yes and told him the cocaine was stored in his car in the parking lot. The two then went to the car, where Roberto removed a package containing what appeared to be a half gram of cocaine, and gave it to Santana in exchange for twenty-five dollars. The substance was sent to the laboratory for analysis and was found to be cocaine.

       
       

   15. On October 1, 1987, Santana and Garcia again visited the lounge and were approached by Eliza who asked them if they wished to purchase cocaine. She also advised them that Roberto had not been in the lounge that day. Even so, she told them she could obtain the drug from another source. Garcia and Santana then placed orders for one and one-half grams of cocaine, respectively. After leaving for a few moments, Eliza returned and handed Santana and Garcia a brown paper napkin containing what appeared to be a gram and a half of cocaine. She was then paid seventy-five dollars by the investigators. The substance purchased was laboratory analyzed and found to be cocaine.

       
       

   16. On October 6, 1987, Santana and Garcia returned to the lounge and were asked by Eliza if they were interested in purchasing cocaine. Although she noted that Roberto had not been in the lounge that day, she told them she could obtain the drug from another source. Thereafter, Garcia and Santana each ordered one-half gram of cocaine from Eliza. After leaving the premises for a few minutes, Eliza returned and gave each investigator what appeared to be one- half gram of cocaine in exchange for fifty dollars. A laboratory analysis of the substance confirmed it was cocaine.

       
       

   17. When the above events occurred, there were no signs posted in the lounge warning patrons not to use drugs or to bring them on the premises. Further, the two investigators were never told by the manager or other employees to not use drugs, nor did they ever see a patron asked to leave because of having drugs in his possession. Max was seen in the lounge almost every day when the investigators were conducting their operation. However, there is no evidence that he personally saw a drug transaction take place, or that he was aware of any illicit activity. This is also the first occasion on which the licensed premises has been investigated.

       
       

3. Mitigation

1. At hearing Max and Olga appeared remorseful about this episode. They denied having knowledge of any drug transactions, and stated that around six months ago they had requested two Miami police officers to lend assistance in ridding their lounge of undesirable elements. They also told the police that

   "rocks" were being smoked in an adjacent parking lot. After the suspension of their license, the barmaids were fired. It is not clear whether Carlos was fired, but he only worked at the lounge for one or two months. A former manager who worked the first five months of 1987 testified he saw no drugs during his tenure, and that he was advised by Max to call the police if there were any problems.

   
   

2. Because of his gunshot wounds, Max concedes it was necessary to hire other persons, perhaps too young, to oversee the lounge. He blames the incidents on those employees. If the license is reinstated, Max intends to shorten business hours and to have either himself or Olga on the premises at all times to ensure that no illicit activities occur. They also desire to sell the establishment, since they have invested their life savings in the business, and it represents their sole support.

   
   

   CONCLUSIONS OF LAW

   
   

3. The Division of Administrative Hearings has jurisdiction of the subject matter and the parties thereto pursuant to Subsection 120.57(1), Florida Statutes (Supp. 1986).

   
   

4. In its notice to show cause, the Division proposes to take action against respondent's license for repeated violations of Subsections 561.29(1) and 562.131(1), Florida Statutes (1985). Those subsections read in relevant part as follows:

   
   

   * * *

   1. Revocation and suspension of license; power to subpoena..--

      1. The division is given full power and authority to revoke or suspend the license of any person holding a license under the Beverage Jaw, when it is determined or found by the division upon sufficient cause appearing of:

         1. Violation by the licensee or his or its agents, officers, servants, or employees, on the licensed premises, or elsewhere while in the scope of employment, of any of the laws of this state or of the United States, or violation of any municipal or county regulation in regard to the hours of sale, service, or consumption of alcoholic beverages, or engaging in or permitting disorderly conduct on the licensed premises, or permitting another on the licensed premises to violate any of the laws of this state or of the United States; except that whether or not the licensee or his or its agents, officers, servants, or employees have been convicted in any criminal court of any violation as set forth in this paragraph shall not be considered in proceedings before the division for suspension or revocation of a license except as permitted by chapter 92 or the rules of evidence.

            * * *

            (c) Maintaining a nuisance on the licensed premises.

            * * *

            562.131 Solicitation for sale of alcoholic beverage prohibited; penalty.--

            1. It is unlawful for any licensee, his employee, agent, servant, or any entertainer employed at the licensed premises or employed on a contractual basis to entertain, perform or work upon the licensed premises to beg or solicit any patron or customer thereof or visitor in the licensed premises to purchase any beverage, alcoholic or otherwise, for such licensee's employee, agent, servant, or entertainer.

            * * *

            
            

5. The evidence is clear and convincing that there were at least twelve confirmed drug transactions by employees on the licensed premises during the seven week investigation. These transactions violated Subsection 893.13(1)(a), Florida Statutes (1985), which makes it illegal for a person to sell or deliver any controlled substance. This in turn constitutes a violation of Subsection 561.29(1)(a), which prohibits an employee of a licensee from violating a law of this state while in the scope of his employment. In addition, Section 823.10, Florida Statutes (1985), defines a nuisance as a place which is visited by persons for the purpose of unlawfully using drugs, or where such drugs are kept or sold. In view of the repeated sale of drugs on the premises, the bar constituted a nuisance within the meaning of the law. As such, the provisions of Subsection 561.29(1)(c) come into play, and authorize the Division to discipline a licensee for "maintaining a nuisance on the licensed premises." Finally, the evidence is clear and convincing that employees solicited drinks from the investigators on at least five separate occasions. These acts violate Subsection 562.131, and in turn constitute a violation of Subsection 561.29(1)(a). All of the above acts were open and notorious, and in plain view of both patrons and employees.

   
   

6. The only remaining issue is whether respondent can be held accountable for the acts of his employees where he was either not present, or had no knowledge of such activities. In order to be held accountable under such circumstances, there must be evidence that the licensee was "culpably responsible for the alleged violations as a result of his own negligence, intentional wrongdoing or lack of diligence." G & B of Jacksonville, Inc. v. State of Florida, 366 So.2d 877, 878 (Fla. 1st DCA 1979). Furthermore, the activity must be persistent or recurring, and involve more than one employee. Pauline v. Lee, 147 So.2d 359, 364 (Fla. 2nd DCA 1962). Here the evidence reflects that Max failed to exercise reasonable care and diligence to insure that the business was conducted in a lawful manner. The illicit conduct occurred on many occasions in an open and notorious manner, and in front of numerous employees and customers. Moreover, it appeared that most, if not all, employees were either participants in or observers of the illegal drug activities. Although Max may not have been aware of these activities, he is nonetheless responsible "as a result of his own negligence . . . or lack of diligence." G & B, 366 So.2d at 878; Lash, Inc. v. State, Department of Business Regulation, 411 So.2d 276 (Fla. 3rd DCA 1982).

   
   

7. In its proposed order, the Division recommends the license be revoked. Respondent does not dispute the facts, but asks only for a second chance, if

only to sell the business so as to not lose his life savings. However, given the numbers and types of violations, revocation of the license is appropriate.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent be found guilty of all charges in the Notice to

Show Cause and that his License No. 230495, Series 2-COP, be REVOKED.

DONE AND ORDERED this 2nd day of November, 1987, in Tallahassee, Leon County, Florida.

DONALD R. ALEXANDER

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 2nd day of November, 1987.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-4483

20. Covered in findings of fact 4 and 21.

Respondent:

1. Covered in findings of fact 1 and 3.

2. Covered in findings of fact 1 and 3.

3. Covered in finding of fact 21.

4. Covered in finding of fact 21. 5.(a) Covered in finding of fact 2.

1. Covered in finding of fact 3 to the extent the investigation was prompted by the City of Miami. The remainder is not supported by the evidence.

2. Covered in finding of fact 22.

1. Covered in finding of fact 21.

2. Covered in finding of fact 22.

3. Rejected since the evidence shows Lourdes and Rosa worked "many months" and "3-4 months," respectively.

4. Covered in finding of fact 22.

5. Covered in finding of fact 23.

6. Covered in finding of fact 23.

COPIES FURNISHED:

Thomas A. Klein, Esquire 725 South Bronough Street

Tallahassee, Florida 32399-1020

Jose M. Herrera, Esquire Post Office Box 345118

Coral Gables, Florida 33114

Daniel Bosanko, Director Division of Alcoholic Beverages

and Tobacco

The Johns Building

725 South Bronough Street Tallahassee, Florida 32399-1000

Van B. Poole, Secretary Department of Business Regulation The Johns Building

725 South Bronough Street Tallahassee, Florida 32399-1000

Joseph A. Sole, Esquire General Counsel

The Johns Building

725 South Bronough Street Tallahassee, Florida 32399-1000

Docket for Case No: 87-004483

Orders for Case No: 87-004483