STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA DEPARTMENT OF )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 89-4205

)

EDWARD J. ZIBRO AND )

ED ZIBRO REALTY, INC. )

)

Respondents. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, Claude B. Arrington, held a formal hearing in the above-styled case on October 24, 1989, in Fort Lauderdale, Florida.

APPEARANCES

For Petitioner: James H. Gillis, Esquire

Senior Attorney

Department of Professional Regulation, Division of Estate

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

For Respondents: Edward J. Zibro, pro se

2803 E. Commercial Boulevard Fort Lauderdale, Florida 33308

STATEMENT OF THE ISSUES

Whether Respondents committed the offenses as alleged in the Administrative Complaint and the penalties, if any, which should be imposed.

PRELIMINARY STATEMENT

This is a disciplinary proceeding brought by Petitioner against Respondent Edward J. Zibro, a licensed real estate broker, and against Respondent Ed Zibro Realty, Inc., a corporation for whom Edward J. Zibro is the qualifying broker. Petitioner filed a four count Administrative Complaint against Respondents for violations that allegedly occurred during the course of two separate transactions.

Count I and Count II of the Administrative Complaint concern a commission dispute in a single transaction between Respondents and Pamela L. Mereider, d/b/a Earthrise Realty, Inc. (Mereider). Count I alleges that Respondent Edward

J. Zibro failed to account and deliver a share of a commission to Mereider in violation of Section 475.25(1)(d), Florida Statutes. Count II alleges that Respondent Ed Zibro Realty, Inc. failed to account and deliver a share of a commission to Mereider in violation of Section 475.25(1)(d), Florida Statutes.

Counts III and IV concern a dispute over the entitlement to an escrow deposit that had been placed with Respondents in connection with a transaction that did not close. The buyer and seller made competing demands for the funds the buyer had placed in escrow. Count III charged Respondent Edward J. Zibro with having failed to account and deliver a deposit in violation of Section 475.25(1)(d), Florida Statutes. Count IV charged Respondent Ed Zibro Realty, Inc. with having failed to account and deliver a deposit in violation of Section 475.25(1)(d), Florida Statutes.

Respondents denied the allegations of the Administrative Complaint and timely requested a formal administrative hearing. This proceeding followed.

At the final hearing, Petitioner presented the testimony of Respondent Edward J. Zibro and the testimony of one other witness. Petitioner presented eight exhibits at the hearing and submitted two additional exhibits as late- filed exhibits. All ten exhibits submitted by Petitioner were accepted into evidence. Respondents presented the testimony of Edward J. Zibro and the testimony of one additional witness. Respondent presented three exhibits, each of which was accepted into evidence. At Petitioner's request, official recognition was taken of Section 20.30, Florida Statutes, and of Chapters 120, 455, and 475, Florida Statutes.

A transcript of the proceedings has been filed. The rulings on the proposed findings of fact submitted on behalf of Petitioner are found in the appendix to this Recommended Order. Respondents filed no post-hearing submittal.

FINDINGS OF FACT

1. Petitioner is a regulatory agency of the State of Florida charged with the responsibility of investigating and prosecuting complaints against real estate professionals, including real estate brokers and their qualified corporations.

   
   

2. Respondent Edward J. Zibro is now and was at all times material hereto a licensed real estate broker in the State of Florida having been issued license number 0359349 in accordance with Chapter 475, Florida Statutes.

   
   

3. Respondent Ed Zibro Realty, Inc. is now and was at all times material hereto a corporation registered as a real estate broker in the State of Florida having been issued license number 0251315 in accordance with Chapter 475, Florida Statutes. Respondent Edward J. Zibro is now and was at all times material hereto an officer of and qualifying broker for Respondent Ed Zibro Realty, Inc.

   
   

4. The Respondents' offices are now and were at all times material hereto located at 2803 East Commercial Boulevard, Suite 202, Fort Lauderdale, Florida.

   
   

5. Respondents and Pamela L. Mereider, d/b/a/ Earthrise Realty, Inc. (Mereider) submitted to arbitration through the Fort Lauderdale Area Board of Realtors, Inc. a dispute involving the right of Mereider to share in a commission check which had been deposited in Respondents' escrow account. By an

   award entered December 4, 1987, Respondents were ordered by the arbitration board to pay Mereider the sum of $1,800.00 within ten days of the date of the award. Respondents had not paid the award at the time of the final hearing.

   
   

6. On February 15, 1989, the County Court in and for Broward County, Florida, issued a final judgment ordering the Respondents to pay to Mereider the sum of $1,800.00 plus arbitration costs of $100.00 and court costs of $58.00. This final judgment was based on the arbitration award dated December 4, 1987, which the Court found to be binding on the parties. Respondents had not satisfied the final judgment at the time of the final hearing in this proceeding.

   
   

7. On November 13, 1987, Respondents, as agents for the seller, obtained a contract for the purchase of Crystal Lakes Chevron Station by Werner Hatzelhoffer (Hatzelhoffer). Hatzelhoffer, as buyer, placed an $11,000.00 deposit in trust with Respondents.

   
   

8. On or about March 16, 1988 Hatzelhoffer's bank was notified that his application for financing this transaction through the Small Business Administration had been rejected. Hatzelhoffer did not obtain financing and the transaction did not close. On August 17, 1988, Hatzelhoffer requested in writing that Respondents return the $11,000.00 deposit with interest. Based on the terms of the contract executed by the parties, Respondents and the seller of the property disputed that Hatzelhoffer was entitled to a refund of the deposit. Hatzelhoffer later requested the return of the deposit money by telephone and went to Respondent's office in person to demand the refund of the deposit. On October 25, 1988, Hatzelhoffer's attorney made written demand of Respondents for the return of Hatzelhoffer's deposit.

   
   

9. On April 21, 1989, Respondent Edward J. Zibro advised Petitioner for the first time of the conflicting demands on the escrow deposit and requested an escrow disbursement order from Petitioner. Petitioner opened an escrow disbursement case and, on May 2, 1989, Gerri E. Barnoske, a complaint analyst for Petitioner, requested in a letter certain information from Respondents relating to the escrow dispute. Respondents did not receive this letter.

   
   

10. On June 2, 1989, Ms. Barnoske wrote to Respondents a second time. This second letter advised that the previously requested information had not been received and that failure to cooperate could result in disciplinary proceedings being brought. The second letter also advised Respondents to let Petitioner know if the matter had been settled.

    
    

11. The dispute involving Mr. Hatzelhoffer's deposit was amicably resolved on May 30, 1989. On May 8, 1989, the seller and his wife executed an agreement which released any claim they may have had to the escrowed funds and which authorized Respondents to negotiate a settlement with Hatzelhoffer. Respondents were also authorized by the release instrument executed by the seller on May 8, 1989, to retain as their commission for the failed transaction any sums they could get Hatzelhoffer to agree was due the seller. As a result of the settlement, Hatzelhoffer was reimbursed $6,500.00 and Respondents retained

    $4,500.00.

    
    

12. Upon receiving Ms. Barnoske's letter dated June 2, 1989, Respondent Edward J. Zibro advised Ms. Barnoske that he had not received her letter dated May 2, 1989. He further advised that the escrow dispute had been settled and enclosed a statement signed by Mr. Hatzelhoffer on May 30, 1989, which acknowledged that the matter had been resolved.

13. On June 22, 1989, Petitioner filed an Administrative Complaint against Respondents which contained four counts. Count I and Count II charged Respondent Edward J. Zibro and Respondent Ed Zibro Realty, Inc., respectively, with having failed to account and deliver a share of a commission in violation of Section 475.25(1)(d), Florida Statutes, based on the dealings with Mereider. Count III and Count IV charged Respondent Edward J. Zibro and Respondent Ed Zibro Realty, Inc., respectively, with having failed to account and deliver a deposit in violation of Section 475.25(1)(d), Florida Statutes, based on the dealings with Hatzelhoffer.

    
    

14. Respondents denied the allegations of the Administrative Complaint and timely requested a formal hearing. This proceeding followed.

    
    

    CONCLUSIONS OF LAW

    
    

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

    
    

16. Section 475.25(1), Florida Statutes (1988), provides, in pertinent part, as follows:

    
    

    1. The commission ... may place a licensee, certified appraiser, registrant, or permittee on probation; may suspend a license, certification, registration, or permit for a period not exceeding 10 years; may revoke a license, certification, registration, or permit; may impose an administrative fine net to exceed $1,000 for each count or separate offense; and may issue a reprimand, and any or all of the foregoing, if it finds that the licensee, certified appraiser, registrant, permittee, or applicant:

       * * *

       (d) Has failed to account or deliver to any person, including a licensee under this chapter, at the time which has been agreed upon or is required by law or, in the absence of a fixed time, upon demand of the person entitled to such accounting and delivery, any personal property such as money, fund, deposit, check, draft, abstract of title, mortgage, conveyance, lease, or other document or thing of value, including a share of a real estate commission, or any secret or illegal profit, or any divisible share or portion thereof, which has come into his hands and which is not his property or which he is not in law or equity entitled to retain under the circumstances. However, if the licensee, in good faith, entertains

       doubt as to what person is entitled to the accounting and delivery of the escrowed property, or if conflicting demands have been made upon him for the escrowed property, which property he still maintains in his escrow or trust account, the licensee shall promptly notify the commission of such doubts or conflicting demands and shall promptly:

       1. Request that the commission issue

          an escrow disbursement order determining who is entitled to the escrowed property;

       2. With the consent of all parties, submit the matter to arbitration; or

       3. By interpleader or otherwise, seek adjudication of the matter by a court.

       
       

       If the licensee promptly employs one of the escape procedures contained herein, and if he abides by the order or judgment resulting therefrom, no administrative complaint may be filed against the licensee for failure to account for, deliver, or maintain the escrowed property.

       
       

17. Petitioner has the burden of proving by clear and convincing evidence the allegations against Respondents. See Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).

    
    

18. Petitioner established by clear and convincing evidence the allegations of Count I and of Count II of the Administrative Complaint. These violations were established by Respondents' failure and refusal to pay the amount awarded to Pamela L. Mereider, d/b/a/ Earthrise Realty, Inc. through the arbitration process to which Respondents had submitted the dispute. These violations were also established by Respondents failure and refusal to satisfy the final judgment entered in favor of Pamela L. Mereider, d/b/a Earthrise Realty, Inc. by the County Court in and for Broward County, Florida.

    
    

19. Petitioner also established by clear and convincing evidence the allegations of Count III and Count IV of the Administrative Complaint. These violations were established by Respondents' failure to promptly act to resolve the escrow dispute. Hatzelhoffer made written demand for the return of his escrow deposit on August 17, 1988. Hatzelhoffer's attorney made written demand of Respondents for the return of the deposit on October 25, 1988. Respondents did not notify Petitioner of the dispute nor did he request a disbursement order or select one of the other options available to them until April 21, 1989. By waiting until April 21, 1989, to follow the requirements of Section 475.25(1)(d), Florida Statutes, Respondents failed to act promptly as required by this provision of law. Although the escrow dispute with Mr. Hatzelhoffer was amicably settled before it became necessary for Petitioner to issue an escrow disbursement order, it is Respondents' failure to promptly act as required by Section 475.25(1)(d), Florida Statutes, which constitutes the violation. Petitioner's argument that Respondents violated Section 475.25(1)(b), Florida

    Statutes, by making material misrepresentations during their dealing with Mr. Hatzelhoffer is rejected as being beyond the scope of the charges contained in the Administrative Complaint.

    
    

20. Section 21V-24.001, Florida Administrative Code, contains the disciplinary guidelines for violations of Chapter 475, Florida Statutes, and provides, in pertinent part, as follows:

    
    

    (3) The minimum penalty for all below listed sections is a reprimand and/or a fine up to $1,000.00 per count. The

    maximum penalties are as listed:

    (j) 475.25(1)(d) - Up to 5 years suspension.

    
    

21. There are no mitigating or aggravating factors which require deviation from these guidelines.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law it is RECOMMENDED that Department of Professional Regulation, Florida Real Estate

Commission enter a final order which finds as follows:

1. Respondent Edward J. Zibro guilty of violating the provisions of Section 475.25(1)(d), Florida Statutes, as alleged in Count I of the Administrative Complaint;

   
   

2. Respondent Ed Zibro Realty, Inc. guilty of violating the provisions of Section 475.25(1)(d), Florida Statutes, as alleged in Count II of the Administrative Complaint;

   
   

3. Respondent Edward J. Zibro guilty of violating the provisions of Section 475.25(1)(d), Florida Statutes, as alleged in Count III of the Administrative Complaint; and

   
   

4. Respondent Ed Zibro Realty, Inc. guilty of violating the provisions of Section 475,25(1)(d), Florida Statutes, as alleged in Count IV of the Administrative Complaint.

IT IS FURTHER RECOMMENDED that the final order entered by Petitioner assess administrative fines against Respondents as follows:

1. Against Edward J. Zibro in the amount of $500.00 for the violation of Count I of the Administrative Complaint.

   
   

2. Against Ed Zibro Realty, Inc. in the amount of $500.00 for the violation of Count II of the Administrative Complaint.

   
   

3. Against Edward J. Zibro in the amount of $500.00 for the violation of Count III of the Administrative Complaint.

   
   

4. Against Ed Zibro Realty, Inc. in the amount of $500.00 for the violation of Count IV of the Administrative Complaint.

IT IS FURTHER RECOMMENDED that the final order entered by Petitioner suspend the licenses and registration of the Respondents for a period of six months or until such time as the administrative fines are paid and the final judgement in favor of Pamela L. Mereider, d/b/a Earthrise Realty, Inc. is satisfied, whichever occurs first.

DONE AND ENTERED this 29th day of November, 1989, in Tallahassee, Leon County, Florida.

CLAUDE B. ARRINGTON

Hearing Officer

The DeSoto Building 1230 Apalachee Parkway

Tallahassee, Florida 32399-1550 904/488-9675

Filed with the Clerk of the Division of Administrative Hearings this 29th day of November, 1989.

APPENDIX TO THE RECOMMENDED ORDER IN CASE 89-4205

The following rulings are made on the proposed findings of fact submitted by Petitioner:

1. The proposed findings of fact in paragraph 1 are

   adopted in material part by paragraph 1 of the Recommended Order.

2. The proposed findings of fact in paragraph 2 are

   adopted in material part by paragraphs 2 and 4 of the Recommended Order.

3. The proposed findings of fact in paragraph 3 are

   adopted in material part by paragraphs 3 and 4 of the Recommended Order.

4. The proposed findings of fact in paragraph 4 are

   adopted in material part by paragraph 3 of the Recommended Order.

5. The proposed findings of fact in paragraph 5 are

   adopted in material part by paragraph 5 of the Recommended Order.

6. The proposed findings of fact in paragraph 6 are

   adopted in material part by paragraph 5 of the Recommended Order.

7. The proposed findings of fact in paragraph 7 are

   adopted in material part by paragraph 5 of the Recommended Order.

8. The proposed findings of fact in paragraph 8 are

   adopted in material part by paragraph 6 of the Recommended Order.

9. The proposed findings of fact in paragraph 9 are

   adopted in material part by paragraph 6 of the Recommended Order.

10. The proposed findings of fact in paragraph 10 are adopted in material part by paragraph 7 of the Recommended Order.

11. The proposed findings of fact in paragraph 11 are rejected as being unnecessary to the result reached.

12. The proposed findings of fact in paragraph 12 are adopted in material part by paragraph 7 of the Recommended Order.

13. The proposed findings of fact in paragraph 13 are adopted in material part by paragraph 8 of the Recommended Order.

14. The proposed findings of fact in paragraph 14 are adopted in material part by paragraph 8 of the Recommended Order.

15. The proposed findings of fact in paragraph 15 are adopted in material part by paragraph 9 of the Recommended Order.

16. The proposed findings of fact in paragraph 16 are adopted in material part by paragraph 9 of the Recommended Order.

17. The proposed findings of fact contained in the

    first sentence of paragraph 17 are adopted in material part by paragraph 11 of the Recommended Order. The proposed findings of fact contained in the second sentence of paragraph 17 are rejected as being subordinate to the findings made in Paragraph

    11 of the Recommended Order.

18. The proposed findings of fact in paragraph 18 are adopted in material part by paragraphs 10 and 12 of the Recommended Order.

19. The proposed findings of paragraph 19 are rejected as being unnecessary to the results reached.

COPIES FURNISHED:

James H. Gillis, Esquire Department of Professional Regulation

400 West Robinson Street Orlando, Florida 32801

Edward Zibro

Ed Zibro Realty, Inc.

2803 East Commercial Boulevard Suite 202

Fort Lauderdale, Florida 33308

Darlene F. Keller Division Director

Department of Professional Regulation

400 West Robinson Street Orlando, Florida 32801

Kenneth E. Easley General Counsel

Department of Professional Regulation

1940 North Monroe Street Tallahassee, Florida 32399-0792

Docket for Case No: 89-004205

Orders for Case No: 89-004205