STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL ) REGULATION, CONSTRUCTION ) INDUSTRY LICENSING BOARD, )

)

Petitioner, )

)

vs. ) CASE NO. 87-5586

)

JULIUS H. ISAAC, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice issued December 30, 1987, a hearing was held in this cause on March 15, 1988, in Tampa, Florida, before Diane A. Grubbs, a Hearing Officer of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: David L. Swanson, Esquire

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32399-0750

For Respondent: Julius H. Isaac, pro se

421 Ella Mae Avenue Tampa, Florida 33602

ISSUE

1. Whether respondent on several occasions aided an unlicensed contractor to engage in contracting by obtaining permits on respondent's license for contracting jobs performed by the unlicensed contractor;

   
   

2. Whether respondent committed the statutory violations alleged; and

   
   

3. If so, whether respondent's license should be suspended or revoked, or whether some other penalty should be imposed.

BACKGROUND

On November 2, 1987, petitioner filed an Administrative Complaint which alleged that respondent was a certified general contractor, that on multiple occasions respondent aided an unlicensed contractor to engage in contracting by obtaining or authorizing the obtaining of permits on respondent's license, that the jobs for which the permits were obtained were undertaken by the contractor who was not properly licensed, and that respondent failed to properly supervise the activities of the firm that undertook the jobs. The complaint also alleged that the unlicensed contractor's name was Johnnie Thomas who was doing business

as J. T. Thomas Construction Company, that the number of occasions were "unknown" but occurred between 1978 and 1986, that the construction jobs were to "build houses," and that the job locations were Hillsborough and Pinellas Counties. The Administrative Complaint alleged that these activities were violations of Section 489.129(1)(e), (g), (m) and (j), Florida Statutes, and Sections 489.119 and 489.105(4), Florida Statutes.

Respondent disputed the allegations of fact contained in the Administrative Complaint and requested a hearing pursuant to Section 120.57(1), Florida Statutes. On December 21, 1987, petitioner referred the matter to the Division of Administrative Hearings for further proceedings.

At the hearing, petitioner presented the testimony of Evelyn Stores Williams; Verlie S. Nelson; Catherine Farragut; Hazel Nelson Jones; Nick D'Andrea, a City of Tampa building department official; Thomas H. Alderman, a Hillsborough County Building Department Code Compliance Investigator; Johnnie T. Thomas, the president of J. T. Thomas Construction Company; Homer Dennis Force, an investigator with the Department of Professional Regulation, and Julius Isaac, the respondent. Petitioner's Exhibits 1 through 8 were admitted into evidence. Respondent called Augusta E. Thomas as a witness on his behalf.

Respondent did not introduce any exhibits into evidence.

On March 25, 1988, the date that the parties' proposed recommended orders were to be filed, respondent, through his newly retained counsel, requested an extension of time in which to file respondent's proposed findings of fact and conclusions of law. Respondent's motion was granted and he was given to and including April 1, 1988, in which to file his proposed recommended order.

Petitioner had already filed its proposed order. Respondent did not file a proposed recommended order by April 1, 1988; however, on April 6, 1988, respondent filed a motion to reopen the hearing which, for the first time, alleged that respondent did not receive any notice of the hearing held March 15 until the morning of the hearing. Petitioner filed a response opposing respondent's motion to reopen the hearing, arguing that it would be prejudicial to petitioner to permit the case to be reopened to permit respondent to present additional witnesses and testimony. On May 10, 1988, the motion to reopen the hearing was denied on the ground that, under the circumstances presented, respondent waived any objection he may have had to the timeliness of the notice.

A transcript of the hearing has not been filed. Petitioner has filed proposed findings of fact and conclusions of law, and a ruling on each of the proposed findings of fact is contained in the Appendix to this order.

Respondent did not file proposed findings of fact or conclusions of law.

FINDINGS OF FACT

1. At all times material to the Administrative Complaint, respondent was a certified general contractor in Florida holding License No. CG C000572.

   
   

2. Johnnie T. Thomas is the president of J. T. Thomas Construction Company. Mr. Thomas is not a licensed contractor in the State of Florida. Although respondent has used his license to qualify several corporations, the last being Julius Isaac & Association, Inc., respondent never qualified J. T. Thomas Construction Company. Indeed, J. T. Thomas Construction has never been qualified by any licensee. During the time period relevant to this action, J.

   T. Thomas Construction Company was the name used by Mr. Thomas to engage in the contracting business.

3. On July 25, 1983, J. T. Thomas Construction Company contracted with Hazel N. Jones for the construction of a residence at 11729 Rock Hill Road, Thonotosassa, Florida, in Hillsborough County. Johnnie Thomas signed the contract on behalf of J. T. Thomas Construction Company as "President and Builder." Ms. Jones did not know that Mr. Thomas was unlicensed. James Montjoy drew the plans for the house and recommended Thomas as the builder. The total price for the house was $75,500. The house was started in September of 1983, and on January 30, 1984 final payment was made. After moving into the house, Ms. Jones discovered several problems. In June of 1984 an energy check found that the home was not properly insulated; however, this was apparently corrected in May of 1985. Ms. Jones had several other problems with the home and sent a "punch-list" to Mr. Thomas setting forth the items that needed to be corrected. Although Mr. Thomas admitted at the hearing that there were items that should have been corrected on the punch-list, he also admitted that he did not correct them because he disputed other claims of Ms. Jones.

   
   

4. The building permit application for Ms. Jones' home was signed by the respondent. On the building permit application, the contractor was listed as Julius Isaac and Association, Inc. The building permit was issued on August 15, 1983. It listed Julius H. Isaac and Julius Isaac and Association, Inc. as the contractor. The building permit was signed by Julius H. Isaac as agent. Ms. Jones never met Mr. Isaac, never saw him and never knew that he was involved in any way in the construction of her home.

   
   

5. In late 1984, Ms. Catherine Farragut, the owner of a building located at 1704 North Nebraska Avenue, Tampa, Florida, contracted with J. T. Thomas to have her building remodeled. Ms. Jones recommended Mr. Thomas to Ms. Farragut before Ms. Jones began to experience problems with Mr. Thomas. Ms. Farragut was not aware that Mr. Thomas was not a licensed contractor. The remodeling of the building was completed in early 1985. The permit for the interior remodeling of the offices at 1704 North Nebraska Avenue was issued on July 23, 1984 to Julius Isaac & Association. Ms. Farragut did see Isaac at the job site in the central parking area; however, Mr. Thomas never advised Ms. Farragut that respondent was involved with the project.

   
   

6. On August 20, 1985 J. T. Thomas Construction Company contracted with Evelyn S. Williams to construct a residence at 3620 East North Bay Street, Tampa, Florida. The contract price for the home was 66,000 and payments by check were made to Johnnie Thomas in intervals. Construction on the home began in November 1985. Ms. Williams moved into the home in August of 1986. She discovered some problems with the house, and gave Mr. Thomas a list of the items that needed to be corrected. Mr. Thomas corrected all the items but one. Ms. Williams still has a problem with the roof getting moldy due to water retention.

   
   

7. A permit was issued by the City of Tampa Building Department on November 20, 1985, for construction at 3620 East North Bay Street. The permit was issued to Julius Isaac and the contractor of record is stated as Julius Isaac d/b/a Julius Isaac & Associates. Ms. Williams never met Mr. Isaac or saw him; however, Ms. Williams did not go to the job site during construction since the mortgage company was supposed to periodically inspect the house during construction. Ms. Williams was not aware that Mr. Thomas was unlicensed.

   
   

8. On August 28, 1986, J. T. Thomas Construction Company entered into a written contract with Ms. Verlie Nelson to construct a residence at 8105 Jad Drive for a price of $102,560. Ms. Nelson thought that Mr. Thomas was a

   licensed contractor. She never saw Mr. Isaac at the job site, however, she was rarely there because Sun Coast Federal Credit Union was paid to do the inspections.

   
   

9. On October 16, 1986, respondent applied for a building permit for 8105 Jad Drive. John and Augusta Thomas were listed as the owners and Julius Isaac & Association, Inc., was listed as the general contractor for the project. On November 7, 1986, the permit was issued by the Hillsborough County Building Department. Julius H. Isaac was listed as the applicant and contractor. John and Augusta Thomas were listed as the owners of the property at 8105 Jad Drive.

   
   

10. Mr. Thomas admitted that J. T. Thomas Construction Company built the homes for Ms. Jones, Ms. Nelson and Ms. Williams, and did the renovation on the building owned by Ms. Farragut. Mr. Thomas received the payments for the projects, hired and paid the subcontractors and supervised construction. He also managed the daily affairs of J. T. Thomas Construction Company.

    
    

11. J. T. Thomas Construction Company was formed in 1971 under the name Thomas (J. T.) Construction Company. However, the company, as a corporate entity, was dissolved by proclamation in 1973. J. T. Thomas' brother Leslie was the secretary of the corporation and a licensed contractor. He obtained the building permits for the company until be became ill. Thereafter, respondent obtained the building permits for J. T. Thomas Construction Company. Respondent knew that Mr. Thomas was not licensed and could not get the permits himself.

    
    

12. Respondent is not a salaried employee of J. T. Thomas Construction Company, and he received no compensation for his services although he was reimbursed for the actual cost of obtaining the permits. Other than obtaining the permits, respondent's only connection with Mr. Thomas' construction projects was to visit job sites before inspections or go to a site if Mr. Thomas asked for his help with a construction problem. However, there was no competent evidence establishing that respondent ever went to the particular job sites involved in this case. Respondent had no responsibilities in connection with the projects and had no authority to take any actions. In essence, respondent was simply "helping" a long time friend.

    
    

13. Respondent has been licensed since 1968, and there was no evidence presented of any prior violations or any prior complaints.

    
    

    CONCLUSIONS OF LAW

    
    

14. The Division of Administrative Hearings has jurisdiction over the subject matter of and the parties to this proceeding. Section 120.57(1), Florida statutes. Section 489.129(1), Florida statutes (1987), gives the Construction Industry Licensing Board the power to take disciplinary action against a licensed contractor and provides, in pertinent part, as follows:

    
    

    1. The Board may revoke, suspend, or deny the issuance or renewal of the certificate or registration of a contractor and impose an administrative fine not to exceed $5,000, place a contractor on probation, or reprimand or censure a contractor if the contractor, or if the business entity or any general partner, officer, director, trustee, or

       member of a business entity for which the contractor is a qualifying agent, is found guilty of any of the following acts:

       * * *

       (e) Aiding or abetting any uncertified or unregistered person to evade any provision of this act.

       * * *

       (g) Acting in the capacity of a contractor under any certificate or registration issued hereunder except in the name of the certificate holder or registrant as set forth on the issued certificate or registration

       * * *

       (j) Failure in any material respect to comply with the provisions of this act.

       * * *

       (m) Upon proof that the licensee is guilty of fraud or deceit or of gross negligence, incompetency, or misconduct in the practice

       of contracting.

       
       

15. Although the Administrative Complaint cited to all of the subsections listed above as the statutory basis for seeking disciplinary action against respondent, petitioner in its proposed conclusions of law asserts only that respondent violated Section 489.129(1)(e), Florida Statutes.

    
    

16. Petitioner has the burden of proving by clear and convincing evidence that the respondent committed the acts alleged. Ferris v. Turlington, 510 So.2d

    292 (Fla. 1987). Petitioner presented evidence which established that respondent was guilty of aiding or abetting J. T. Thomas, an uncertified and unregistered person, to evade the provisions of Chapter 489. Section 489.113(2) provides that "no person who is not a licensee shall engage in the business of contracting in this state." By obtaining building permits for the construction projects that were performed by Mr. Thomas, respondent aided and abetted Mr. Thomas in violating Section 489.113(2).

    
    

17. The other grounds for disciplining respondent have not been supported by petitioner. Further, the evidence presented does not support a finding that respondent is guilty of those acts set forth in Subsections 489.129(1)(g), (j), and (m), Florida Statutes.

    
    

18. Although the Administrative Complaint does not clearly identify the basis for charging that respondent committed the acts set forth in Subsections 489.129(1)(g) and (j), the complaint cites to Sections 489.119 and 489.105(4), Florida Statutes. Section 489.119 requires an applicant who proposes to engage in construction as a corporation or other business entity to apply through a qualifying agent. The qualifying agent must be legally qualified to act for the business entity in all matters connected with the contracting business and must have authority to supervise the construction undertaken by the business.

    Section 489.105(4) defines "qualifying agent." Apparently the theory behind the charges was that respondent was engaging in contracting as J. T. Thomas Construction Company, although he had failed to qualify that company. However, the evidence clearly established that respondent was not engaging in contracting as J. T. Thomas Construction Company. J. T. Thomas was engaging in contracting as J. T. Thomas Construction Company. Therefore, respondent did not fail to comply with Section 489.119, and thus did not commit the act set forth in

    Subsection 489.129(j). For the same reason, respondent did not "[a]ct in the capacity of a contractor ... except in the name of the certificate holder," since respondent did not act in the capacity of a contractor on any of the construction projects.

    
    

19. Section 489.129(1)(m) permits a contractor to be disciplined "[u]pon proof that the licensee is guilty of fraud or deceit or of gross negligence, incompetency, or misconduct in the practice of contracting." (e.s.) "Contracting" is defined as "engaging in business as a contractor." Section 489.105(5), Florida Statutes. Section 489.105(3) defines "contractor" as "the person who is qualified for and responsible for the entire project contracted for and means ... the person who, for compensation, undertakes to construct, repair, alter, remodel or improve any building." The administrative complaint alleged, and the evidence established, that respondent "did aid an unlicensed contractor in engaging in contracting." In other words, it was the unlicensed person, not the respondent, who was "engaging in business as a contractor" on all of the projects involved in the instant case. Therefore, respondent is not subject to discipline pursuant to Section 489.129(m), Florida Statutes.

    
    

20. Rule 21E-17.001, Florida Administrative Code provides as follows:

Normal Penalty Ranges. The following guidelines shall be used in disciplinary cases, absent aggravating or mitigating circumstances and subject to the other provisions of this Chapter.

* * *

(13) 489.129(1)(e): Aiding or abetting evasion of Chapter 489. First violation,

$500 to $1500 fine; repeat violation, $500 to $3000 fine and one year suspension.

Rule 21E-17.002, Florida Administrative Code, sets forth the aggravating and mitigating circumstances which may be considered. In this case, there are both aggravating and mitigating circumstances. The aggravating circumstances include the damage to Ms. Jones by the failure to correct certain items on the "punch list" which, by Mr. Thomas' admission, should have been corrected, and the number of occasions respondent pulled permits for work performed by Mr. Thomas. On the other hand, there was no evidence of gross negligence or incompetency in the construction of the homes or of any actual damage to the owners of the homes. Further, there was no evidence of any complaints, other than the instant one, filed against respondent, and he has been licensed since 1968. Therefore, the penalty should be within the range set forth in Rule 21E-17.001(13), Florida Administrative Code.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Construction Industry Licensing Board enter a final

order finding respondent guilty of the act set forth in Section 489.129(e), Florida Statutes, and imposing an administrative fine of $1,500.

DONE AND ENTERED this 27th day of May, 1988, in Tallahassee, Florida.

DIANE A. GRUBBS

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 27th day of May, 1988.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-5586

Rulings on petitioner's proposed findings of fact by paragraph: 1-8 Accepted generally.

COPIES FURNISHED:

David L. Swanson, Esquire Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32399-0750

Julius H. Isaac

421 Ella Mae Avenue Tampa, Florida 33602

Fred Seely Executive Director

Construction Industry Licensing Board

Post Office Box 2 Jacksonville, Florida 32201

William O'Neil Stephen F. Hanlon, Esquire

General Counsel BARNETT, BOLT & KIRKWOOD Department of Professional Post Office Box 3287 Regulation 100 Twiggs Street

130 North Monroe Street Sixth Floor Tallahassee, Florida 32399-0750 Tampa, Florida 33602

Docket for Case No: 87-005586

Orders for Case No: 87-005586