STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL )

REGULATION, DIVISION OF )

REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 90-0514

)

CHARLES VINCENT SUTER, )

)

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 September 13, 1990, in Fort Myers, Florida.

APPEARANCES

For Petitioner: Steven W. Johnson, Esquire

P. O. Box 1900

Orlando, Florida 32802-1900

For Respondent: Jerrold S. Stern, Esquire

P. O. Box 112

Sanibel, Florida 33957 STATEMENT OF THE ISSUES

Whether respondent's license as a real estate salesman should be disciplined for the reasons cited in the administrative complaint, and if so, what is the appropriate penalty.

PRELIMINARY STATEMENT

By a four count administrative complaint filed on December 7, 1989, petitioner, Department of Professional Regulation, Division of Real Estate, charged that respondent, Charles Vincent Suter, licensed as a real estate salesman, had violated Chapter 475, Florida Statutes (1987) in conjunction with a real estate transaction that occurred in late 1988 and early 1989. More specifically, petitioner alleged that after a renter had made a deposit on an apartment and agreed to a specified rental rate, respondent advised the renter that an additional $1,000 was needed. The complaint goes on to allege that respondent deposited the additional $1,000 in his personal checking account without advising his broker of this fact. It is alleged that the foregoing conduct violated Subsections 475.25(1)(b),(e), and (k) and 475.42(1)(d), Florida Statutes (1987).

Respondent disputed the above allegations and requested a formal hearing pursuant to Subsection 120.57(1), Florida Statutes (1989) to contest the proposed agency action. The matter was referred by petitioner to the Division of Administrative Hearings on January 29, 1990, with a request that a hearing officer be assigned to conduct a hearing. By notice of hearing dated February 19, 1990, a final hearing was scheduled on May 2, 1990, in Fort Myers, Florida. At the request of petitioner, the hearing was continued pending submission of a proposed settlement to the Division. When the settlement was rejected, the matter was rescheduled to July 18, 1990, and at respondent's request, rescheduled again to September 13, 1990, at the same location.

At final hearing, petitioner presented the testimony of Joe Jacob, a DPR investigator, and Thomas J. Roderick, the real estate broker who initiated this complaint. Also, it offered petitioner's exhibits 1-8. All exhibits were received in evidence. Respondent testified on his own behalf and presented the testimony of Mary Jane Briney and James Henry Lee, Jr. Also, he offered respondent's exhibits 1-4. All exhibits were received in evidence.

There is no transcript of hearing. At the request of the parties, the record was kept open for the purpose of taking the telephonic deposition of Norma Winkler. On October 26, 1990, petitioner advised that the deposition would not be taken and the record was accordingly closed. Proposed findings of fact and conclusions of law were filed by the parties on October 29, 1990. A ruling on each proposed finding is made in the Appendix attached to this Recommended Order.

FINDINGS OF FACT

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

1. Respondent, Charles Vincent Suter (Suter), is a licensed real estate salesman having been issued license number 0502107 by petitioner, Department of Professional Regulation, Division of Real Estate (Division). When the events herein occurred, respondent was employed as a salesman for Tom Roderick Realty, 2440 Palm Ridge Road, Sanibel, Florida. He has been licensed as a salesman since September 1987.

   
   

2. Through a mutual friend, Mary Jane Briney, Suter was introduced in 1988 to Norma Winkler, a resident of Indianapolis, Indiana, who occasionally visited Sanibel Island near Fort Myers on vacation during the winter months. Winkler was interested in renting a three bedroom condominium on the beach in January and February 1989. Briney recommended to Winkler that she rent a unit at an apartment/condominium complex known as Janthinia located on Sanibel Island and that she use respondent as her rental agent. Relying on Briney's recommendation, Winkler agreed to rent the unit and telephoned Suter in September 1988 and requested that he make reservations for her. Although Suter did not normally handle rental transactions, he agreed to assist Winkler and thereafter made reservations with Executive Services, Inc. (ESI), a corporation which managed various units in the Sanibel area including Janthinia.

   
   

3. On September 21, 1988, Suter sent Winkler a letter confirming her reservations for Unit 2A at Janthinia with an arrival date of January 26, 1989 and a departure date of February 23, 1989. The total rent, including tax, was

   $7,091.23. Suter also advised Winkler that she needed to furnish a 10% deposit, or $709.12, within ten days to secure the reservation.

4. On September 30, 1989, Winkler sent a check in the amount of $709.23 made payable to Tom Roderick Realty. The check was deposited into the firm's escrow account the same day. On October 4, 1989, the realty company issued a check in the same amount to ESI as a reservation deposit for Winkler.

   
   

5. After the deposit was forwarded to the real estate firm, Winkler changed her date of arrival in Florida from January 26 to January 20 but kept her date of departure the same. On December 9, 1989, ESI confirmed Winkler's reservation for those dates and sent a 10% commission to the realty company. The rental fee was shown as $8,395.42 less the deposit, or a total amount still due of $7,686.30. On January 30, 1989, Suter was paid $352.75 as his share of the commission.

   
   

6. Approximately a week before her scheduled arrival, Suter telephoned Winkler and advised her the total amount due was $8,686.30, or $1,000 more than was reflected on ESI's statement. However, Winkler had requested that Suter furnish her with a VCR, liquor, piano and other items so Suter estimated the total bill would be approximately $1,000 greater than the rent still due.

   
   

7. On January 20, 1989, Winkler, her sister, niece and a neighbor flew from Indianapolis to Fort Myers. They were met at the airport by Suter and two mutual friends. That same morning, and before Winkler arrived, Suter received by mail Winkler's check in the amount of $8,686.30.

   
   

8. When Suter received Winkler's check, he immediately deposited it in his own checking account and not the firm's account. The check was made out to Suter, and not the realty firm, since Winkler had suggested that she make it out in that manner. Upon depositing the check, Suter immediately asked the bank to verify if it was good, and after receiving assurances that it was, he went across the street and wrote a $7,686.30 check to ESI to pay for Winkler's rent.

   
   

9. When Winkler, Suter and other members of the group reached Janthinia, Suter advised Winkler that he owed her a refund. Winkler told him not to worry, that she would settle up later. She then had Suter purchase a quantity of liquor and obtain a VCR for her apartment.

   
   

10. During one of the social gatherings attended by Winkler and Suter a few weeks later, the two had a falling out. At that point, Winkler telephoned Suter's broker and told him she was due money from Suter. On February 7, the broker confronted Suter around 4:00 p.m. regarding Winkler's allegation. Suter readily acknowledged that Winkler still had money due and that he would immediately pay her. He also acknowledged that the money had been placed in his own bank account rather than the broker's escrow account. Although Suter volunteered to hand carry a check to Winkler that afternoon, she insisted he pay it to the broker who would then write her a check. Suter did so within the hour and Winkler later received a check for $1,000 from the real estate firm. The broker then made an inquiry with the Division concerning Suter's actions, and upon advice from a Division attorney, filed a complaint against Suter.

    
    

11. Winkler was described by a longtime friend as a 1,dangerous person", a "troublemaker", and someone who had caused problems for many persons over the years with various types of accusations, most of which were unfounded.

    
    

12. Suter denied that he knew it was unlawful to deposit the rent check in his personal account since he considered the transaction as a favor for a friend. He blamed the entire episode on Winkler who became mad at him for paying too much attention to a young widow, and not Winkler, at a dinner party

    in early February 1989. There was no intent on the part of Suter to use the deposited funds in an illicit manner or to defraud his broker and Winkler. Even so, Winkler's check should have been deposited in the broker's escrow account.

    
    

13. There is no evidence that Suter has ever been disciplined by the Division on any prior occasion. Further, Suter's initial reluctance to give a statement to an investigator was founded on the valid reason that he first wished to consult an attorney.

    
    

    CONCLUSIONS OF LAW

    
    

14. The Division of Administrative Hearings has jurisdiction of the subject matter and the parties hereto pursuant to Subsection 120.57(1), Florida Statutes (1989).

    
    

15. . Because respondent's professional license is at risk, petitioner is obligated to prove the allegations in the complaint by clear and convincing evidence. Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).

    
    

16. Respondent is charged with having violated Subsections 475.25(1)(b),(e), and (k) and 475.42(1) (a) and (d), Florida Statutes (1987), by his conduct in the Winkler transaction. Subsections 475.25(1)(b),(e) and (k) authorize the Division to initiate disciplinary action against a licensee if the licensee

    
    

    Has been guilty of fraud, misrepresentation, concealment, false promises, pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction in this state or any other state, nation, or territory; has

    violated a duty imposed upon him by law or by the terms of a listing contract, written, oral, express, or implied, in a real estate transaction; has aided, assisted, or conspired with any other person engaged in any such misconduct and in furtherance thereof; or has formed an intent, design, or scheme to engage in any such misconduct and committed an overt act in furtherance of such intent, design, or scheme. It is immaterial to the guilt of licensee that the victim or intended victim of the misconduct has sustained no damage or loss; that the damage or loss has been settled and paid after discovery of the misconduct; or that such victim or intended victim was a customer or a person in confidential relation with the licensee or was an identified member of the general public.

    (e) Has violated any of the provisions of this chapter or any lawful order or rule made or issued under the provisions of this chapter or chapter 455.

    (k) Has failed, if a broker to immediately place, upon receipt, any money, fund,

    deposit, check, or draft entrusted to him by any person dealing with him as a broker in escrow with a title company, banking institution, credit union, or savings and loan association located and doing business in this state, or to deposit such funds in a trust or escrow account maintained by him with some bank, credit union, or savings and loan association located and doing business in this state, wherein the funds shall be kept until disbursement thereof is properly authorized; or has failed, if a salesman, to immediately place with his registered employer any money, fund, deposit, check or draft entrusted to him by any person dealing with him as agent of his registered employer. The commission shall establish rules to provide for the records to be maintained by the broker and the manner which such deposits shall be made.

    
    

    In addition, Subsections 475.42(1)(a) and (d), Florida Statutes (1989) read as follows:

    
    

    1. No person shall operate as a broker or salesman without being the holder of a valid and current license therefor.

       (d) No salesman shall collect any money in connection with any real estate brokerage transaction, whether as a commission, deposit, payment, rental, or otherwise, except in the name of the employer and with the express consent of the employer; and no real estate salesman, whether the holder of a valid and current license or not, shall commence or maintain any action for a commission or compensation in connection with a real estate brokerage transaction against any person except a person registered as his employer at the time the salesman performed the act or rendered the service for which the commission or compensation is due.

       
       

17. The complaint alleges that respondent is guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence or breach of trust in a business transaction in violation of Subsection 475.25(1)(b), Florida Statutes (1989) (Count I), failing to immediately place a deposit with his employing broker as required by Subsection 475.25(1)(k) (Count II), operating as a broker while licensed as a salesman in violation of Subsections 475.25(1)(e) and 475.42(1)(a), Florida Statutes (1989) (Count III), and collecting money in connection with a real estate transaction except in the name of the employer and with the express consent of the employer as proscribed by Subsections 475.25(1)(e) and 475.42(1)(d), Florida Statutes (1989) (Count IV).

18. As to Count I, the case of Fleischman v. Department of Professional Regulation, 441 So.2d 1121, 1123 (Fla. 3rd DCA 1983) teaches us that there must be a showing of intent or scienter on the part of the licensee in order to establish a violation of Subsection 475.25(1)(b). There being no such intent or scienter on the part of Suter, this portion of the administrative complaint must fail.

    
    

19. As to the charges in Counts II - IV, by clear and convincing evidence petitioner has shown that respondent failed to immediately place a deposit with his employer as proscribed by Subsection 475.25(1)(k), (Count II), operated as a broker while licensed as a salesman in violation of Subsections 475.25(1)(e) and 475.42(1)(a) (Count III), and collected money in connection with a transaction other than in the name and consent of the employer as prohibited by Subsections 475.25(1)(e) and 475.42(1) (d) (Count IV).

    
    

20. For the above transgressions, petitioner's counsel suggests that a

$2,500 penalty is appropriate. This suggested penalty is, of course, premised on the notion that respondent is guilty of all four counts. Rule 21V-24.001, Florida Administrative Code (1989) sets forth suggested penalties to be imposed on licensees guilty of violating chapter 475. The rule authorizes a penalty of up to eight years suspension or revocation of a license for the cited violations. However, because the violations were clearly unintentional, and constitute the only blemish on respondent's record as a real estate salesman, a fine of $500 is more appropriate.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent be found guilty as charged in Counts II, III,

and IV of the administrative complaint and that Count I be dismissed with prejudice. It is further

RECOMMENDED that respondent be given a $500 fine to be paid within thirty days from date of order.

DONE and ENTERED this 8th day of November, 1990, in Tallahassee, Florida.

DONALD R. ALEXANDER

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 8th day of November, 1990.

APPENDIX

Petitioner:

1-3. Partially adopted in finding of fact 1.

4. Partially adopted in finding of fact 3.

5-6. Partially adopted in finding of fact 4.

1. Partially adopted in finding of fact 5.

2. Partially adopted in findings of fact 6 and 8. 9-10. Partially adopted in finding of fact 2.

11. Rejected as being unnecessary.

12-13. Partially adopted in finding of fact 6.

14. Partially adopted in findings of fact 7 and 8. 15-16. Partially adopted in finding of fact 10.

17-18. Partially adopted in finding of fact 12. 19-21. Partially adopted in finding of fact 10.

Respondent:

1-2. Partially adopted in finding of fact 1.

1. Partially adopted in finding of fact 2.

2. Partially adopted in findings of fact 2 and 3.

3. Partially adopted in finding of fact 4.

4. Partially adopted in finding of fact 5.

5. Partially adopted in findings of fact 5 and 6. 8-9. Partially adopted in finding of fact 5.

10-11. Partially adopted in finding of fact 8.

1. Partially adopted in finding of fact 7.

2. Partially adopted in finding of fact 9. 14-15. Rejected as being unnecessary.

16. Partially adopted in finding of fact 10.

Note - Where findings have been partially used, the remainder has been rejected as being cumulative, unnecessary, subordinate, irrelevant or not supported by the more credible and persuasive evidence.

COPIES FURNISHED:

Steven W. Johnson, Esquire

P. O. Box 1900 Orlando, FL 32802-1900

Jerrold S. Stern, Esquire

P. O. Box 112 Sanibel, FL 33957

Kenneth E. Easley, Esquire

1940 North Monroe Street, Suite 60

Tallahassee, FL 32399-0792

Darlene Keller, Executive Director Division of Real Estate

P. O. Box 1900 Orlando, FL 32802-1900

NOTICE OF RIGHT TO FILE EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. You should consult with the agency that will issue the final order in this case concerning their rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.

Docket for Case No: 90-000514

Orders for Case No: 90-000514