STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CHARLES R. BURRELL, d/b/a ) CHARLES R. BURRELL FARMS, )

)

Petitioner, )

)

vs. ) CASE NO. 88-4381A

) BATTAGLIA PRODUCE INC. and ) SOUTH CAROLINA INSURANCE ) COMPANY, )

)

Respondents. )

)

RECOMMENDED ORDER

Final hearing in the above-styled action was held in Orlando, Florida, on December 16, 1988, before Mary Clark, Hearing Officer from the Division of Administrative Hearings. The parties were represented as follows:

For Petitioner: Charles R. Burrell

Route 1, Box 1

Hastings, Florida 32045 (representing himself)

For Respondent: Ralph V. Hadley, III, Esquire Battaglia Hadley and Asma

Produce, Inc. Post Office Box 1340

Winter Garden, Florida 32787

For Respondent: No appearance South Carolina

Insurance Co.

BACKGROUND AND PROCEDURAL MATTERS

On or about June 28, 1988, Charles R. Burrell, doing business as Charles R. Burrell Farms, filed his complaint with the Florida Department of Agriculture and Consumer Services, pursuant to Section 604.21, Florida Statutes, alleging that Battaglia Produce, Incorporated, owed him a balance of $3,347.51 for 727.72 crates of green cabbages, sold on May 19, 1988.

Respondent filed a timely answer denying the claim, and the case was referred to the Division of Administrative Hearings to conduct a formal hearing pursuant to Section 120.57(1), Florida Statutes.

At the hearing, Mr. Burrell testified in his own behalf and presented the testimony of his wife, Barbara Burrell, who handles the recordkeeping and paperwork for Burrell Farms. The Burrell's composite exhibit consisting of their narrative statements, a statement by Ernest Rhodes, various invoices and adjustment sheets was received in evidence without objection.

Tony Battaglia, President of Battaglia Produce, Inc. testified on behalf of Respondent. In addition, Respondent's exhibits #1 and 1A were received without objection.

After hearing both parties submitted summary statements. These and all matters of record have been considered in the preparation of this recommended order.

ISSUE

The ultimate issue for determination is whether Respondent owes Petitioner payment for approximately 728 crates of green cabbages. This requires a determination of whether Respondent acted properly in consigning the load to Tampa Bay Produce rather than returning the cabbages to Petitioner.

FINDINGS OF FACT

1. Petitioner is a grower doing business at his farm at Route 1, Box 1 in Hastings, St. Johns County, Florida.

   
   

2. Respondent, Battaglia Produce, Inc., is a produce broker with an office in Virginia Beach, Virginia. Its President, Tony Battaglia, has been a produce broker for thirty-five years.

   
   

3. Respondent, South Carolina Insurance Company, is the bonding agent for Battaglia pursuant to Section 604.20, Florida Statutes.

   
   

4. On May 19, 1988, Burrell sold a load of 791 crates of cabbages to Battaglia for and on the account of Publix Supermarkets, Inc. It is uncontroverted that at the time the cabbages left the field they were of good quality.

   
   

5. The load was rejected by Publix in Lakeland on May 20, 1988. A sample of 30 crates out of the load revealed 27 crates were under the industry standard weight of fifty pounds.

   
   

6. Battaglia learned that freight for the load back to Hastings would be expensive, so he consigned the load to Tampa Bay Produce, Inc., in Tampa, Florida for the purpose of sale.

   
   

7. The subsequent consignment to Tampa Bay Produce was without the prior consent of Burrell. Battaglia has had an ongoing good business relationship with Burrell. Burrell's loads have been rejected at times in the past and Battaglia has never had problems obtaining Burrell's prior permission for disposing of the loads.

   
   

8. Battaglia handles a total of approximately 1000 loads of cabbage a season and approximately 15% get rejected. He typically tries to resell the load to get the best advantage for the grower.

   
   

9. Tampa Bay had some delay in selling the load. Some cabbages spoiled, and on May 31, 1988, 420 crates were dumped. The remainder sold for $606.00. Tampa Bay Produce deducted its 15% handling charge and paid Battaglia $515.00 for the load.

10. In his accounting to Charles Burrell dated June 22, 1988, Battaglia deducted freight from Hastings to Lakeland and from Lakeland to Tampa and a pre- cooling charge in Tampa. He showed a net loss of $153.15 for the load. Battaglia did not claim a brokerage fee. Battaglia deducted the $153.15 from other funds it owed Burrell for other cabbage loads and paid Burrell the balance appearing on an accounting of this and eight other loads of cabbage, dated June 23, 1988.

    
    

    At the hearing the Burrells amended their request for payment to add the

    $153.15 deducted for the load.

    
    

11. Burrell computed an average underweight based on the 30-crate sample from Publix and adjusted his invoice to Battaglia to reflect an 8% reduction. The invoice is dated June 27, 1988. Burrell claims that the 791 crates were sold for $4.60 per crate, for a total of $3,638.60. The 30 crates weighed an average of 46.14 pounds or eight percent less than the 50-lb. industry standard. An eight percent adjustment in the cost yields a total of $3,347.51.

    
    

12. Burrell does not contest the underweight findings by Publix. He insists that he should have been informed immediately and given a change to bring the shipment back, repack the cabbages and sell them again. Instead, someone from Battaglia called Barbara Burrell on May 21st to tell her the load was turned down by Publix and was shipped to Tampa. She called Battaglla several times to get details on the short weight so that she could adjust their bill, but she was unable to get any information until the latter part of June, and by then Battaglia's position was that the load was a net loss. She obtained the weight information eventually from Publix.

    
    

13. Battaglia claims that he acted professionally in handling the load and that he owes no additional funds to Burrell.

    
    

    CONCLUSIONS OF LAW

    
    

14. The Division of Administrative Hearings has jurisdiction over the parties and subject matter in this proceeding pursuant to Section 120.57(1), Florida Statutes.

    
    

15. Petitioner is a "producer" of agricultural products, as defined in Section 604.15(5), Florida Statutes.

    
    

16. Respondent is a "dealer in agricultural products", as defined in Section 604.15(1), Florida Statutes.

    
    

17. Section 604.21, Florida Statutes provides for a complaint, an investigation and a Chapter 120, Florida Statutes hearing when a person such as Petitioner claims to be damaged by breach of an agreement given by a licensed dealer in agricultural products. The dealer and its surety are parties to the action.

    
    

18. The evidence in this case is based on the testimony of the principals and on their business records. In his proposed findings of fact, Respondent characterizes the transaction as a sale of 791 crates of cabbages "...for and on the account of Publix Supermarkets, Inc.". Respondent also candidly admits that he did not obtain Burrell's permission prior to consignment to Tampa Bay Produce.

19. If the transaction were a sale, as the parties seem to agree, Battaglia is responsible for the full sales price, less that what can reasonably be determined as shortage.

    
    

    If, however, Battaglia acted as Burrell's agent, the subsequent consignment to Tampa Bay Produce was prohibited by Section 604.211, Florida Statutes, which provides as follows:

    
    

    604.211 Limitation on successive consignments.

    No licensee, while acting as an agent for a producer or in disposing of agricultural products received on consignment from a producer or his agent or representative, shall consign such products to another, use the services of a broker, or receive more than one commission or fee for making the sale thereof, unless by written consent of the producer or consignor. No charges or costs for acts prohibited by this section may be passed on to the producer or consignor.

    
    

    Thus, the costs related to the Tampa Bay transaction still could not be charged against Burrell's account.

    
    

20. Although he mentioned a written "growers' agreement", Battaglia did not produce this document. He did not controvert the claimed sales price nor the sampling of weights from Publix. In the absence of any alternative method, the Burrell's averaging of weights to adjust the price of the load is reasonable.

It is entirely conceivable that if they had been asked, the Burrells might have agreed to disposition of the load in Tampa. If they had insisted on return to Hastings, it is also possible that they would have had to pay the freight; the cabbages may have spoiled anyway; and they still may have lost the load.

All this is speculative. Based on the evidence, the Burrells proved their entitlement to the amount claimed in them complaint, and the additional $153.15, withheld by Battaglia for his losses.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED:

That a final order be entered requiring that Respondent pay to Petitioner the sum of $3500.66 and informing Respondent that failure to make such payment within fifteen (15) days will result in recovery from its surety, as provided in Subsection 604.21(8), Florida Statutes.

DONE and ENTERED this 20th day of March, 1989, in Tallahassee, Leon County, Florida.

MARY CLARK

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 20th day of March, 1989.

COPIES FURNISHED:

Charles R. Burrell Charles R. Burrell Farms Route 1, Box 1

Hastings, Florida 32045

Ralph V. Hadley, III, Esquire Hadley and Asma

Post Office Box 1340

Winter Garden, Florida 32787

South Carolina Insurance Company Post Office Box 1

Columbia, South Carolina 29202

Ben H. Pridgeon, Jr., Chief Bureau of License and Bond Department of Agriculture and

Consumer Services

Mayo Building, Room 418 Tallahassee, Florida 32399

=================================================================

AMENDED AGENCY FINAL ORDER

=================================================================

BEFORE THE STATE OF FLORIDA DEPARTMENT OF AGRICULTURE AND CONSUMER SERVICES

CHARLES R. BURRELL

d/b/a CHARLES R. BURRELL FARMS,

Petitioner,

DOAH CASE NO. 88-4381A

vs. LB CASE NO. 89-0023

BATTAGLIA PRODUCE, INC.

and SOUTH CAROLINA INSURANCE COMPANY,

Respondents.

/

AMENDED FINAL ORDER

1. Vacation of Initial Final Order

   
   

   1. On June 12, 1989, a "Final Order" (copy attached) was signed in this case. Such "Final Order" contains no notation that such "Final Order" was filed with this agency's clerk as described by Rule 5A-1.0013, Florida Administrative Code, so as to constitute a final agency decision within the meaning of Subsection 120.52(11), Florida Statutes (Supp. 1988), which requires such a filing as well as the Clerk's notation thereon of the date of such filing. Absent such "rendition" (compare Rule 9.020, Florida Rules of Appellate Procedure), that "Final Order" is not a final order.

      
      

   2. After receipt of the Hearing Officer's Recommended Order signed and rendered on March 20, 1989, but before the "Final Order" was signed but not rendered on June 12, 1989, the Respondent Battaglia Produce, Inc. (Sic: Battaglia Produce Sales, Inc.) filed a Chapter 11 petition in the United States Bankruptcy Court for the Eastern District of Virginia, Case No. 89-0172 NT, on May 10, 1989.

      
      

   3. By operation of Title 11, Section 362, United States Code--the automatic stay provision of the Bankruptcy Code--further proceedings against that debtor are barred absent relief therefrom by order of that court.

      
      

   4. At the time its "Final Order" was signed herein on June 12, 1989, the undersigned and his personnel had no knowledge of debtor's bankruptcy petition.

      
      

   5. Therefore, in light of the foregoing, the "Final Order" in this cause signed June 12, 1989, is vacated as having been inadvertently signed contrary to

      11 USC, Sec. 362; as not final, contrary to Section 120.52(11), supra, but even if final despite Section 120.52(11), supra, it is vacated in accordance with my "inherent authority" in light of the preemptive Bankruptcy Code provision, supra, under authority of the Florida Supreme Court's decision in Taylor v. Department of Professional Regulations, 520 So.2d 557 (Fla. 1988), to correct

      the inadvertent mistake of having signed such "Final Order" on June 12, 1989, without knowing at that time of Respondent's Chapter 11 filing on May 10, 1989. And, this Amended Final Order is hereby rendered.

      
      

2. Amended Final Order

1. On March 20,1989, the Hearing Officer's Recommended Order was rendered.

   
   

2. That Recommended Order (copy attached) is hereby adopted with one exception. Because the Respondent filed bankruptcy on May 10, 1989, it has the protection of the U.S. Bankruptcy Code in this proceeding, including the automatic stay of Section 362 thereof.

   
   

3. But, in light of 11 USC section 524(e), this proceeding is not stayed as to Respondent's surety. See, also, U.S. v. George A. Fuller Co., 250 F. Supp. 649 (D. Mont. 1955), and First National City Bank v. Kline, 439 F. Supp. 726 (S.D. N.Y. 1977).

   
   

4. Accordingly, Co-Respondent South Carolina Insurance Company "stands in the shoes of its principal" and, therefore, is liable to Complainant in the sum of $3,500.66, which it shall pay forthwith.

NOTICE OF APPEAL RIGHTS

Section 120.68, Florida Statutes entitles you to appeal this Amended Final Order. To do so, you must file notice thereof within 30 days from the rendition hereof in accordance with the Florida Rules of Appellate Procedure.

DONE and ORDERED this 29th day of September, 1989.

DOYLE CONNER

Commissioner of Agriculture

Filed with the Agency Clerk this 29th day of September, 1989.

COPIES FURNISHED:

Charles R. Burrell

d/b/a Charles R. Burrell Farms Route 1, Box 1

Hastings, Florida 32045

Battaglia Produce, Inc. Post Office Box 1340

Winter Garden, Florida 32787

South Carolina Insurance Company 1501 Lady Street

Columbia, South Carolina 29202

Mary Clark Hearing Officer

DIVISION OF ADMINISTRATIVE HEARINGS

The Oakland Building 2009 Apalachee Parkway

Tallahassee, Florida 32301

Messrs. James Brooks and Allan Kunz, Field Representatives

FILE CLERK

Docket for Case No: 88-004381

Orders for Case No: 88-004381