STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE )

AND TREASURER, )

)

Petitioner, )

)

vs. ) CASE NO. 90-4430

)

RANDY LEE POMERANTZ, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on December 7, 1990, at Fort Lauderdale, Florida, before Michael M. Parrish, a duly designated Hearing Officer of the Division of Administrative Hearings.

Appearances at the hearing were as follows:

APPEARANCES

For Petitioner: James A. Bossart, Esquire

Department of Insurance

412 Larson Building Tallahassee, Florida 32399-0300

For Respondent: Ted Crespi, Esquire

110 Tower, Suite 815

110 S.E. 6th Street

Fort Lauderdale, Florida 33301 STATEMENT OF THE ISSUES

This is a license discipline case in which the Petitioner seeks to take disciplinary action against a licensee on the grounds that he has violated several provisions of the insurance law. The specific allegations material to this case are that the Respondent has violated Section 626.611(7), 626.611(14), and 626.621(8), Florida Statutes, by reason of being guilty of the crime of Grand Theft in the third degree.

PRELIMINARY STATEMENT

By means of an Amended Administrative Complaint, the Respondent was charged, in three separate counts, with violation of various statutory provisions. At the formal hearing the Petitioner voluntarily dismissed Counts I and II, and proceeded only on Count III. In support of its position the Petitioner offered three exhibits, all of which were received in evidence. The Petitioner did not call any witnesses. The Respondent testified on his own behalf. The Respondent did not call any other witnesses, nor did he offer any

exhibits. At the conclusion of the hearing the parties were allowed ten days from the filing of the transcript within which to file their proposed recommended orders.

On January 4, 1991, the transcript was filed. Thereafter, the Petitioner filed a timely proposed recommended order. The proposed findings of fact submitted by the Petitioner are specifically addressed in the Appendix to this Recommended Order. The Respondent did not file a proposed recommended order, but on January 22, 1991, the Respondent filed a document titled Respondent's Exceptions And Objections To Proposed Recommended Order Submitted By The Office Of The Treasurer And Department Of Insurance. On January 30, 1991, the Petitioner filed a Motion To Strike addressed to the document described immediately above. The basic grounds for the Motion To Strike are that the document filed on January 22, 1991, constitutes unauthorized and impermissible rebuttal to the Petitioner's proposed recommended order which is not authorized by Chapter 120. The Motion To Strike is well taken and is hereby GRANTED.

FINDINGS OF FACT

1. The Respondent, Randy Lee Pomerantz, is currently eligible for licensure and is licensed in the State of Florida as a general lines, property, casualty, surety, and miscellaneous lines insurance agent.

   
   

2. On or about May 30, 1989, the Respondent, along with one of his former employees, was charged by Information in the Circuit Court of the Eleventh Judicial Circuit, in and for Dade County, Florida, in Case No. 89-20405, with fifteen felony counts and three misdemeanor counts. The fifteen felony counts included one count of a RICO violation, one count of scheme to defraud, three counts of grand theft in the second degree, and ten counts of grand theft in the third degree.

   
   

3. On or about July 13, 1990, the Respondent entered a plead of nolo contendere to Count VIII of the information, which was one of the counts charging grand theft in the third degree in violation of Section 812.014, Florida Statutes. The prosecutor entered a nolle prosequi as to all other counts insofar as they related to the Respondent. Adjudication of guilt was withheld on Count VIII. The Respondent was placed on probation for three years and ordered to pay restitution in the amount of $2,325.03.

   
   

4. The Respondent's plea of nolo contendere to Count VIII of the Information was a plea of convenience. The Respondent did not commit the acts alleged in Count VIII of the Information. As the Respondent explained at the hearing, at the time of his plea his wife was about to give birth and he did not feel he could take a chance on a "roll of the dice" with a jury trial.

   
   

   CONCLUSIONS OF LAW

   
   

5. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of these proceedings. Section 120.57(1), Florida Statutes.

   
   

6. In a case of this nature, the Petitioner must prove its case by clear and convincing evidence. Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).

7. Grand theft in the third degree is a felony under Florida law. See Section 812.014, Florida Statutes. The crime of grand theft in the third degree is a crime involving moral turpitude. See State ex rel. Tullidge v. Hollingsworth, 146 So. 660 (Fla. 1933), and Pearl v. Florida Board of Real Estate, 394 So.2d 189 (Fla. 3d DCA 1981). 1/

   
   

8. The Amended Administrative Complaint alleges that the Respondent violated three provisions of Chapter 626, Florida Statutes; Sections 626.611(7), 626.611(14), and 626.621(8), Florida Statutes. Those provisions read as follows:

   
   

   626.611 Grounds for compulsory refusal, suspension, or revocation of agent's, solicitor's, or adjuster's license or service representative's, supervising or managing general agent's or claims investigator's permit.

   (7) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance.

   (14) Having been found guilty of, or having pleaded guilty or nolo contendere to, a felony in this state or any other state which involves moral turpitude, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.

   626.621 Grounds for discretionary refusal, suspension, or revocation of agent's, solicitor's, or adjuster's license or service representative's, supervising or managing general agent's or claims investigator's permit.

   (8) Having been found guilty of, or having pleaded guilty or nolo contendere to, a felony in this state or any other state, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.

   
   

9. With regard to the alleged violations of Sections 626.611(14) and 626.621(8), Florida Statutes, attention must first be directed to Ayala v. Department of Professional Regulation, 478 So.2d 1116 (Fla. 1st DCA 1985). In Ayala the court had before it the question of how to apply a statute regulating the practice of medicine, Section 458.311(1)(c), Florida Statutes, 2/ which authorized disciplinary action against a licensee for

   
   

   Being convicted or found guilty, regardless of adjudication, of a crime in any jurisdiction which directly relates to the practice of medicine or to the ability to practice medicine. Any plea of nolo contendere shall be considered a conviction for purposes of this statute. (Emphasis added)

   With regard to the last sentence of the statutory provision quoted immediately above, the Ayala court concluded:

   
   

   We find that Section 458.331(1)(c) is

   clearly constitutional by construing the word "shall" in the last sentence of that subsection as permissive rather than mandatory in meaning. Rich v. Ryals, 212 So.2d 641, 643. As so construed, the Board of Medical Examiners may presumptively consider the nolo contendere plea as evidence of a conviction for purposes of chapter 458; however, in accordance with the Supreme Court's opinion in The Florida Bar v.

   Lancaster, 448 So.2d 1019, the Board must allow appellant the opportunity to rebut this presumption and assert his innocence of the underlying criminal charges by explaining the reasons and circumstances surrounding his plea of nolo contendere, and thereby attempt to convince the Board that he is not guilty of a crime in violation of the provisions of section 458.331(1)(c). The Board must consider this evidence in deciding appellant's guilt or innocence for purposes of the disciplinary charges. Such explanation may, of course, always be considered in mitigation of punishment if appellant should be adjudicated guilty by the Board.

   
   

10. Applying the holding in Ayala to the facts in this case leads to the conclusion that there has been no showing of a violation of Sections 626.611(14) and 626.621(8), Florida Statutes. Consistent with the requirements of Ayala, the Respondent was allowed an opportunity to "assert his innocence of the underlying criminal charges by explaining the reasons and circumstances surrounding his plea of nolo contendere...." The Respondent took advantage of that opportunity and, as evidenced by the foregoing findings of fact, was successful in convincing the Hearing Officer that he was not guilty of the underlying criminal charges. Such being the case, under the holding in Ayala, the Respondent cannot be subjected to disciplinary action under either Section 626.611(14) or Section 626.621(8), Florida Statutes.

    
    

11. The remaining allegation is that the Respondent violated Section 626.611(7), Florida Statutes, by reason of a "Demonstrated lack of fitness or trustworthiness to engage in the business of insurance." The greater weight of the evidence is to the effect that the Respondent did not engage in the criminal conduct described in the Amended Administrative Complaint. There is no evidence of any other misconduct by the Respondent, nor is there any other evidence that specifically addresses his fitness or trustworthiness to engage in the business of insurance. Accordingly, the evidence is insufficient to support a violation of Section 626.611(7), Florida Statutes.

RECOMMENDATION

For all of the foregoing reasons, it is RECOMMENDED that the Department of Insurance and Treasurer issue a Final Order in this case dismissing the Amended Administrative Complaint in its entirety.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 27th day of February 1991.

MICHAEL PARRISH

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 27th day of February 1991.

APPENDIX TO RECOMMENDED ORDER IN CASE NO. 90-4430

The following are the specific rulings on all proposed findings of fact submitted by all parties.

Findings proposed by Petitioner:

Paragraphs 1, 2, and 4: Accepted.

Paragraph 3: Rejected as contrary to the greater weight of the evidence. Although it is likely that the facts alleged in Count VIII of the Information related to the transaction of insurance business in this state, such is not established by clear and convincing evidence. And, in any event, the matter is irrelevant in light of the findings that the Respondent's plea was a plea of convenience and that the Respondent was not guilty of the crime charged.

Findings proposed by Respondent:

COPIES FURNISHED:

James A. Bossart, Esquire Department of Insurance

412 Larson Building Tallahassee, Florida 32399-0300

Ted Crespi, Esquire

110 Tower, Suite 815

110 S.E. 6th Street

Fort Lauderdale, Florida 33301

Tom Gallagher Bill O'Neil

State Treasurer and General Counsel Insurance Commissioner Department of Insurance The Capitol, Plaza Level and Treasurer Tallahassee, Florida 32399-0300 The Capitol, Plaza Level Tallahassee, Florida 32399-0300

NOTICE OF RIGHT TO SUBMIT 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. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency 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.

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AGENCY FINAL ORDER

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OFFICE OF THE TREASURER DEPARTMENT OF INSURANCE

IN THE MATTER OF DOAH CASE NO.: 90-4430 Case No. 90-L-254JB

RANDY LEE POMERANTZ

/

FINAL ORDER

THIS CAUSE came on before the undersigned Treasurer of the State of Florida, acting in his capacity as Insurance Commissioner, for consideration and final agency action. On May 29, 1990, an Administrative Complaint was filed charging the Respondent with various violations of the Insurance Code. The Respondent timely filed a request for a formal proceeding pursuant to Section 120.57(1), Florida Statutes. On November 6, 1990, an Order was entered wherein an Amended Administrative Complaint was deemed filed contemporaneous with a Notion For Leave To Amend, filed November 6, 1990. Pursuant to notice, the matter was heard before Michael N. Parrish, Hearing Officer, Division of Administrative Hearings, on December 7, 1990.

After consideration of the evidence, argument and testimony presented at hearing, and subsequent written submissions by the parties, the hearing officer issued his Recommended Order (Attached as Exhibit A). The hearing officer recommended that the Department enter a Final Order dismissing the Administrative Complaint. The Petitioner timely filed two (2) exceptions to the hearing officer's Recommended Order which have been considered and addressed herein. The Respondent filed one (1) exception which has been considered herein.

RULINGS ON PETITIONER'S EXCEPTIONS

1. Petitioner first excepts to Conclusions of Law #5 and #6 in the Recommended Order contending that the hearing officer's reliance on Ayala v Department of Professional Regulation 478 So. 2d 1116 (Fla. 1st DCA 1985) is misplaced.

   
   

   In Ayala, supra at 1117, the Court's paramount concern was the construction of Section 458.331(1)(c), Florida Statutes, which provided that a plea of nolo contendere "shall be considered a conviction for purposes of this chapter."

   The Court disagreed with the statutory conclusive presumption of guilt.

   However, the reliance on Ayala is inapposite to this case. At issue in this matter are sections 626.611(14) and 626.621(8), Florida Statutes which provide:

   
   

   626.611 Grounds for compulsory refusal, suspension, or revocation of agent's solicitor's, or adjuster's license or service representative's, supervising or managing general agent's or claims investigator' s permit.

   (14) Having been found guilty of, or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of one year or more under the law of the United States of America or of any state thereof or under the

   law of any other country which involves moral turpitude, without regard to whether a judgment of conviction has been entered

   by the court having jurisdiction of such cases. 626.621 Grounds for discretionary refusal, suspension, or revocation of agent's, solicitor's, or adjuster's license or

   service representative's, supervising or managing general agent's or claim investigator' s permit.

   (8) Having been found guilty of, or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of one year or more under the law of the United States of America or of any state thereof or under the law of any other country, without regard to

   whether a judgment of conviction has been entered by the court having jurisdiction of such cases.

   
   

   It is apparent from reading Sections 626.611(14) and 626.621(8), Florida Statutes, that they do not impermissibly convert a nolo contendere plea into a conviction. It is the entry of such a plea that is a violation of these particular statutes.

   
   

   In McNair v. Criminal Justice Standards and Training Commission,

   518 So. 2d 390 (Fla. 1st DCA 1987), the Court distinguished Ayala, supra, on that same basis. That is, sections 626.611(14) and 626.621(8), Florida Statutes, similar to the statute at issue in McNair, supra, provide compulsory and discretionary grounds for disciplining the Respondent's licenses without impermissibly converting a plea of nolo contendere into a conviction as was the case in Ayala.

   
   

   It was established at hearing that the Respondent entered a plea of nolo contendere to a charge of grand theft in the third degree. (TR. 22). This is a crime of moral turpitude. See State ex. rel. Tullidge v. Hollingsworth, 146 So. 660 (Fla. 1933); Pearl v. Florida Board of Real Estate, 394 So. 2d 189 (Fla. 3d DCA 1981). This activates the mandatory provisions of section 626.611 which calls for suspension or revocation, as well as the discretionary section 626.621. Moreover, it is well-established that an agency's interpretation of the statutes it is charged with administering is entitled to great deference.

   Department of Insurance v. Southeast Volusia Hospital District, et al., 438 So.2d 815 (Fla. 1983), cert. denied, 466 U.S. 901 (1984); Natelson vs.

   Department of Insurance, 454 So. 2d 31 (Fla. 1st DCA 1984); School Board of Pinellas County v. Department of Administration, 492 So. 2d 767 (Fla.

   1st DCA 1986). Further, it must be noted that insurance is a business greatly affected by the public trust with the agent standing in a fiduciary capacity with both the insured and the insurer. Natelson, supra. Based upon the statutes relevant to this case, the Petitioner has the statutory authority to discipline the Respondent under both statutes. Therefore, Petitioner's Exception #1 is ACCEPTED.

2. The Petitioner also excepts to Conclusion of Law #7 in the Recommended Order. This particular Conclusion of Law involves Section 626.611(7), Florida Statutes, which reads:

626.611 Grounds for compulsory refusal, suspension or revocation of agent's, solicitor's, or adjuster's license or service representative's, supervising or managing general agent's or claims investigator' s permit.

(7) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance.

In light of the precepts of Natelson, supra, and Paisley v. Department of Insurance, 526 So.2d 167 (Fla. 1st DCA 1988), it is certainly possible to perceive the acts to which the Respondent pled as evincing a lack of fitness or trustworthiness to engage in the business of insurance. Accordingly, Petitioner1s Exception #2 is also ACCEPTED.

RULING ON RESPONDENT'S EXCEPTIONS

Respondent takes exception to the Hearing Officer's Preliminary Statement on page 2, paragraph 2 of the Recommended Order and to the Appendix to the Recommended Order wherein the Hearing Officer stated that Respondent did not file a Proposed Recommended Order. This exception is beyond the scope of this Order. The Hearing Officer stated he did not receive a Proposed Recommended Order and that finding can not be changed in this Final Order. Respondent's Exception #1 is therefore DENIED.

RULING ON RESPONDENT'S RESPONSE TO PETITIONER'S EXCEPTIONS TO RECOMMENDED ORDER

On March 19, 1991, Respondent filed Respondent's Response To Petitioner's Exceptions To Recommended Order. The aforementioned Response constitutes unauthorized and impermissible rebuttal to Petitioner's Exceptions To Recommended Order which is not authorized by Chapter 120. Therefore, the Response is without merit and will not be considered herein.

Upon careful consideration of the Record, the submission of the parties and being otherwise advised in the premises, it is

ORDERED:

1. The Findings of Fact of the hearing officer are adopted in full as the Department's Findings of Fact, except for the finding that Respondent did not commit the crime to which he entered his plea of nolo contendere. This finding is not relevant to the charges contained in the Amended Administrative Complaint. The guilt or innocence of the Respondent was not at issue in the Amended Administrative Complaint, only whether Respondent had violated the Insurance Code and should be disciplined accordingly. In the event the guilt or innocence of the Respondent was at issue, the Department would have presented evidence on that issue.

2. The Conclusions of Law of the hearing officer numbered 1 through 4 are adopted as the Department's Conclusions of Law. However, the Conclusion of Law of the hearing officer numbered 5 through 7, being based on a faulty legal premise, are rejected.

   
   

3. The hearing officer's Recommendation that the Amended Administrative Complaint be dismissed is REJECTED as being inappropriate to the disposition of this case.

ACCORDINGLY, RANDY LEE POMERANTZ is deemed to have violated Sections 626.611(14), 626.621(8), and 626.611(7), Florida Statutes. As a result of these violations the Respondent's insurance licenses shall be SUSPENDED for one (1) year pursuant to Section 626.641, Florida Statutes. In not ordering a revocation of Respondent's insurance licenses, the Respondent's explanation regarding the circumstances surrounding his plea has been taken account (TR. 14- 24), however, pursuant to section 626.611(7) and 626.611(14) a period of suspension is mandated. Further, the Respondent's licenses shall not be reinstated until such time as the Respondent provides proof to the Department of his completion of the court ordered restitution.

Any party to these proceedings adversely affected by this Order is entitled to seek review of this Order pursuant to Section 120.68, Florida Statutes,

and Rule 9.110, Florida Rules of Appellate Procedure. Review proceedings must be instituted by filing a Notice of Appeal with the General Counsel, acting as the agency clerk, at 412 Larson Building, Tallahassee, Florida 32399- 03 00, and a copy of the same and filing fee with the appropriate District Court of Appeal within thirty (30) days of rendition of this Order.

DONE and ORDERED this 18th day of April, 1991.

TOM GALLAGHER

Treasurer and Insurance Commissioner

Copies Furnished To:

Michael M. Parrish, Hearing Officer

The Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

Randy Lee Pomerantz

4200 Northwest 107th Avenue Coral Springs, FL 33065

Ted Crespi, Esquire

110 Tower, Suite 815

110 S.E. 6th Street

Fort Lauderdale, FL 33301

James A. Bossart, Esquire Division of Legal Services

412 Larson Building Tallahassee, FL 32399-0300

Docket for Case No: 90-004430

Orders for Case No: 90-004430