STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL REGULATION, ) BOARD OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 88-4592

)

JOHN YOUNG, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, K. N. Ayers, held a public hearing in the above- styled case on April 25, 1989, at Tampa, Florida.

APPEARANCES

For Petitioner: Arthur R. Shell, Jr., Esquire

Post Office Box 1900 Orlando, Florida 32801

For Respondent: Robert H. Dillinger, Esquire

5511 Central Avenue

St. Petersburg, Florida 33701 STATEMENT OF THE ISSUES

Whether Respondent is guilty of fraud, misrepresentation concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction as alleged in Administrative Complaint dated July 23, 1988.

PRELIMINARY STATEMENT

At the hearing Petitioner called six witnesses, Respondent testified in his own behalf and six exhibits were admitted into evidence. Authority was given Petitioner to submit the deposition of William Davis as a late filed exhibit not later than May 16, 1989. This deposition was not submitted.

Proposed findings of fact were not timely submitted by either party.

FINDINGS OF FACT

1. At all times relevant hereto John Young was registered as a real estate salesman by the Florida Real Estate Commission.

   
   

2. On October 2, 1985 Respondent and William Kelly, D.O. entered into a contract to jointly purchase a condominium from Concord Developers Inc. (Exhibit

   1). The contract provided for a down payment of $2,000 with an additional earnest money deposit of $3690 to be paid on or before November 4, 1985.

   Respondent and Kelly each gave the seller a check for $1000 at the signing of the contract and this $2000 was deposited in escrow with the escrow agent.

   
   

3. Kelly met Respondent through Respondent's wife who worked in Kelly's office. At the time Kelly was looking for income tax shelters and this purchase appeared to qualify for that purpose.

   
   

4. On November 9, 1985, Kelly made out a check payable to John Young in the amount of $1845 which represented Kelly's half of the additional $3690 earnest money deposit. This check was either cashed by Young or deposited in Young's bank account (Exhibit 2).

   
   

5. The additional earnest money deposit was not made to the seller, as required by the contract, Exhibit 1. Young notified Bayside Federal Savings and Loan Association, who was to finance the sale, that the loan application was withdrawn, the transaction was cancelled, and two checks in the amount of $1000 each were returned to the seller by the escrow agent (Exhibit 6).

   
   

6. The customary practice of the seller in such a situation was to return the down payment to the buyer by check drawn on the seller's account. While no witness could recall this specific transaction, the usual practice would be to return the deposit to the buyer. In this case, the deposit would normally have been returned to Young.

   
   

7. Young acknowledged that he received the return of his $1000 deposit but not the $1000 that represented Kelley's portion of the down payment.

   
   

8. When Kelley gave Young the check for $1845 he inquired if it was necessary for him (Kelley) to attend the closing and Young advised him it was not.

   
   

9. When Kelley subsequently learned that the transaction did not close, he demanded the return of his money. To date he has received none of the monies he deposited to purchase this property.

   
   

10. Evidence was presented that in December 1985, Young closed on a condominium he and his wife had contracted to purchase in this same development, and subsequently moved into this unit. While this indicates Young had the opportunity to convert Kelley's contribution to the purchase of the condominium by Young and his wife, no credible evidence was presented that he did so. The evidence that was presented regarding this transaction was that Young was able to move into that unit with a total cash outlay of less than $500.

    
    

11. Young accounted for the $1845 check from Kelley as payment of a bet between him and Kelley on one football game. In rebuttal Kelley testified that not only did he not bet with Young on any matter, but also he has never gambled on a football game in his life.

    
    

12. Young's testimony that a $1845 bet was made on a football game is so unbelievable that it taints all of his testimony.

    
    

    CONCLUSIONS OF LAW

    
    

13. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

14. Respondent is here charged with violation of Section 475.25(1)(b), Florida Statutes which provides the Commission may suspend, revoke, or otherwise discipline a license if it finds the licensee:

    
    

    has been guilty of fraud ... or breach of trust in any business transaction.

    
    

15. In a license revocation proceeding the agency must prove the allegations by clear and convincing evidence. Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).

    
    

16. Here the evidence is unrebutted that Kelley paid some $2845 into a joint venture with Respondent and when the transaction fell through he recovered none of this money. While the evidence respecting Kelley's initial $1000 earnest money deposit is not clear and convincing that it was retained by Respondent, it is clear that Kelley's second payment of $1845 was received by Respondent and was never returned to Kelley. This was clearly a business transaction and in converting Kelley's $1845 to his own use, Respondent is guilty of fraud, misrepresentation and breach of trust in a business transaction.

RECOMMENDATION

That the Real Estate license of John Young be revoked. Entered this 2nd day of June, 1989, in Tallahassee, Florida.

K. N. AYERS 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 2nd day of June, 1989.

COPIES FURNISHED:

Arthur R. Shell, Jr., Esquire Post Office Box 1900

Orlando, Florida 32801

Robert H. Dillinger, Esquire 5511 Central Avenue

St. Petersburg, Florida 33701

Darlene F. Keller Division Director

Department of Professional Regulation

Division of Real Estate

400 West Robinson Street Orlando, Florida 32802

Bruce D. Lamb General Counsel

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32399-0729

Docket for Case No: 88-004592

Orders for Case No: 88-004592