STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS ) REGULATION, FLORIDA LAND ) SALES, CONDOMINIUMS AND ) MOBILE HOMES, )

)

Petitioner, )

)

vs. ) CASE NO. 91-3108

)

CAP FENDIG, )

)

Respondent. )

)

RECOMMENDED ORDER

This matter came on for hearing in Jacksonville, Florida, before Robert T. Benton, II, Hearing Officer of the Division of Administrative Hearings, on September 23, 1991. The Division of Administrative Hearings received the hearing transcript on October 2, 1991. The parties filed proposed recommended orders on October 29, 1991. The attached appendix addresses separately numbered proposed findings of fact by number.

APPEARANCES

For Petitioner: Thomas Bell, Esquire

Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32399-1007

For Respondent: H. N. "Cap" Fendig

205 Marina Drive

St. Simons Island, Georgia 31522 STATEMENT OF THE ISSUE

Whether respondent acted as a yacht broker in Florida without holding a yacht broker's license issued by petitioner?

PRELIMINARY STATEMENT

By notice to show cause, dated March 29, 1991, petitioner alleges that "[r]espondent, in violation of section 326.004(1), Florida Statutes, has acted as a Yacht Broker without being licensed as such by the Division of Florida Land Sales, Condominiums and Mobile Homes of the Department of Business Regulation [DBR] . . . [and that s]pecifically, on February 16, 1991, Respondent offered to sell a certain 1982 55' Ocean Super Sportfisherman named 'Westwind,' which was docked at slip 221, Miami Beach, Florida, during the 3rd Annual Brokerage Yacht Show held February 14-18, 1991."

On April 26, 1991, respondent requested a formal hearing, and petitioner duly referred the request to the Division of Administrative Hearings, in accordance with Section 120.57(1)(b)3., Florida Statutes (1990 Supp.).

FINDINGS OF FACT

1. Respondent Heidt Neil "Cap" Fendig, Jr., and his corporate alter ego, Go Fish, Inc., do business under the name Golden Isles Charter Company. Aside from operating the marina he leases on St. Simons Island, Georgia, Mr. Fendig hires out as a captain (for $175 a day), arranges charters, and acts as a yacht broker in Georgia.

   
   

2. When Kirby J. Bourgeois acquired the Westwind, a 55-foot "Ocean Super Sportfisherman," the man to whom the boat had previously belonged recommended respondent to Mr. Bourgeois, an Oklahoman who knew little about boats, as somebody who could assist him.

   
   

3. When Messrs. Fendig and Bourgeois met on October 5 or 6, 1990, respondent agreed to register the Westwind in the name of a corporation (Mandela Corp.) Mr. Bourgeois specified, and to equip the boat in accordance with Coast Guard requirements. Later he took Mr. Bourgeois out on "training trips." For each of these services, respondent prepared invoices which Mr. Bourgeois paid in due course.

   
   

4. Around Thanksgiving of 1990, Mr. Fendig acted as the Westwind's captain on a cruise Mr. Bourgeois took to the Bahamas. They left the boat docked in Marsh Harbor. In January of 1991, Mr. Bourgeois told Mr. Fendig on the telephone that he wanted to sell the Westwind.

   
   

5. At that time, if not before, Mr. Fendig mailed Mr. Bourgeois a packet of information about selling boats, which included a form yacht brokerage agreement. Instead of signing the yacht brokerage agreement, Mr. Bourgeois decided to show the Westwind at the Third Annual Brokerage Yacht Show in Miami Beach, one of the alternatives Mr. Fendig had suggested.

   
   

6. Mr. Fendig, who had once inquired of petitioner DBR about obtaining a Florida yacht broker's license, and been told he was ineligible because he lived and worked out of state, advised Mr. Bourgeois that he was not licensed in Florida and could not act as a yacht broker in Florida.

   
   

7. From conversations he had with petitioner's employees at the time he discussed obtaining a Florida license, Mr. Fendig understood that Florida law permitted him to accompany and assist yacht owners in the sale or purchase of yachts in Florida so long as he did not buy or sell as an owner's agent.

   
   

8. Mr. Fendig agreed to bring the Westwind over from Marsh Harbor for the show, which began on February 14, 1991, a Thursday. On January 23 or 24, 1991, respondent sent Mr. Bourgeois a facsimile transmission, described as confirmation of a telephone conversation, in which he wrote: "As per your instructions, I will transport the boat to the Miami show and look for your arrival in Miami at [sic] sometime during the show." Petitioner's Exhibit No. 4.

   
   

9. Although Mr. Bourgeois had informed respondent "that he would not be able to be there the first day" (T.24), Mr. Fendig arrived before the show began. He also filled out a form application and a contract for exhibit space, Petitioner's Exhibit No. 3, which, together with the application fee, had

   reached Yachting Provisions, Inc. in Ft. Lauderdale, on February 1, 1991. Mr. Bourgeois, whose name did not appear on the application and contract, later reimbursed him the fee.

   
   

10. Reportedly delayed by a snowstorm, Mr. Bourgeois did not reach Miami before Saturday evening. Until Mr. Bourgeois arrived, Mr. Fendig stayed with the boat, moored at slip 221 on Collins Avenue. Available to anybody who visited the Westwind while he was on board were copies of his business card, which included the words "YACHT SALES-YACHT MANAGEMENT." Petitioner's Exhibit No. 6.

    
    

11. Also available to show goers (including those to whom respondent never spoke) were one page fliers describing the Westwind and concluding: "Asking

    $350,000 Looking for serious offers contact H. N. "Cap" Fendig, Golden Isles Yacht Sales & Charter Co. 912 638-7717 St. Simons Island, Ga." Petitioner's Exhibit No. 5. Respondent had asked his brother to make up this flier.

    
    

12. Like other paid captains, respondent told anybody who inquired the owner's asking price. When, on the first day of the boat show, investigators in petitioner's employ posed as potential buyers, Mr. Fendig told them they would have to speak to the owner, who would be arriving later in the show. He told "everybody that, if they wanted to make an offer, the owner was coming and they could drop by later in the show and . . . talk to him." T. 36.

    
    

13. While at the boat show, Mr. Fendig slept on the boat, which was an economic benefit for him, at the same time it afforded the vessel a measure of security, which was an economic benefit for the owner. Mr. Bourgeois paid him for bringing the boat to Miami Beach, but not for the time he spent there. He had wanted to go to the boat show for his own purposes, in any event. The yacht show closed on Monday without the Westwind's changing hands.

    
    

14. Mr. Bourgeois still owned the Westwind on March 11, 1991, when he signed a yacht brokerage agreement with respondent Fendig. Petitioner's Exhibit No. 7. Before that time Mr. Fendig had no agreement for or expectation of any compensation on account either of the Westwind's sale or of his efforts to accomplish a sale (other than bringing the boat to Miami, for which he received a fixed amount.)

    
    

    CONCLUSIONS OF LAW

    
    

15. Since DBR referred respondent's hearing request to the Division of Administrative Hearings, in accordance with Section 120.57(1)(b)3., Florida Statutes (1990 Supp.), "the division has jurisdiction over the formal proceeding." Section 120.57(1)(b)3., Florida Statutes (1990 Supp.).

    
    

16. Strict procedural protections apply in disciplinary cases, and the prosecuting agency's burden is to prove its case clearly and convincingly. Ferris vs. Turlington, 510 So.2d 292 (Fla. 1987). See Addington vs. Texas, 441

    U.S. 426 (1979); Ferris vs. Austin, 487 So.2d 1163 (Fla. 5th DCA 1986);

    Anheuser-Busch, Inc. vs. Department of Business Regulation, 393 So.2d 1177 (Fla. 1st DCA 1981); Walker vs. State Board of Optometry, 322 So.2d 612 (Fla. 3rd DCA 1975); Reid vs. Florida Real Estate Commission, 188 So.2d 846, 851 (Fla. 2nd DCA 1966). A licensee's breach of duty justifies revocation only if the duty has a "substantial basis," Bowling vs. Department of Insurance, 394 So.2d 165, 173 (Fla. 1st DCA 1981) in the evidence, unless applicable statutes and rules create a clear duty, which the evidence shows has been breached. An unlicensed person

    faced with substantial monetary penalties is no less entitled to clear notice and clear proof.

    
    

17. Section 326.006(2), Florida Statutes (1989) confers power and imposes a duty on petitioner

    
    

    to enforce and ensure compliance with the provisions of . . . chapter [326] and

    rules promulgated pursuant [t]hereto relating to the sale and ownership of yachts and ships.

    . . .

    (d) Notwithstanding any remedies available to a yacht or ship purchaser, if the division has reasonable cause to believe that a violation of any provision of this chapter or rule promulgated pursuant [t]hereto has occurred, the division may institute enforcement proceedings in its own name against any broker or salesman or their assignees or agents, as follows:

    . . .

    
    

    4. The division may impose a civil penalty against a broker or salesman, or their assignees or agents, for any violatio

    of . . . . chapter [326] or a rule promulgated pursuant [t]hereto. A penalty may be imposed on the basis of each day of continuing violation, but in no event shall the penalty for any offense exceed $10,000. All amounts collected shall be deposited with the Treasurer to the credit of the Division of Florida Land Sales, Condominiums, and Mobile Homes Trust Fund. If a broker or salesman fails to pay the civil penalty, the division shall thereupon issue an order suspending the broker's license until such time as the civil penalty is paid or may pursue enforcement of the penalty in a court of competent jurisdiction. The order imposing the civil penalty or the order of suspension will not become effective until

    20 days after the date of such order. Any action commenced by the division shall be brought in the county in which the division has its executive offices or in the county where the violation occurred.

    
    

    (Emphasis supplied.) Section 326.002(1), Florida Statutes (1989), defines broker to include unlicensed as well as licensed persons:

    
    

    "Broker" means a person who for or in expectation of compensation: sells, offers, or negotiates to sell; buys, offers, or negotiates to buy; solicits or obtains listings of; or negotiates the purchase,

    sale or exchange of, yachts for other persons.

    
    

    (Emphasis supplied.) Section 326.004(1), Florida Statutes (1989), provides in pertinent part:

    
    

    A person may not act as a broker or salesman unless licensed pursuant to the Yacht and Ship Brokers Act [Chapter 326.]

    
    

    Section 326.004(1), Florida Statutes (1989) does not purport to apply outside Florida, and DBR does not contend otherwise. The question is whether DBR has clearly and convincingly proven that respondent acted as a yacht broker at the boat show in Miami in February of this year.

    
    

18. Respondent asserts that he acted no differently than other captains at the boat show who communicated asking prices and answered technical questions as boat owners' agents. But, as far as the evidence revealed, the other captains were all licensed as yacht brokers in Florida; the record is silent on the point. Nor is the defense that "everybody was doing it" a good one.

    
    

19. By telling inquirers the owner's asking price and by distributing the flyers his brother had made up for him, respondent made offers on behalf of Mr. Bourgeois, while in Florida, to sell the Westwind for $350,000. These activities fall within the definition of "act[ing] as a broker," however, only if done "for or in expectation of compensation."

    
    

20. Respondent testified he was not compensated for distributing flyers and relating the asking price orally. His lodging on board was in exchange for the security his presence afforded the boat, as far as the evidence showed. He testified without contradiction that the only payment he received was for bringing the boat to Miami, and that he was not even paid for staying with it until Mr. Bourgeois relieved him. The evidence did not clearly and convincingly establish otherwise.

RECOMMENDATION

It is, accordingly recommended that petitioner dismiss the notice to show cause.

RECOMMENDED this 5th day of December, 1991, in Tallahassee, Florida.

ROBERT T. BENTON, II

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 5th day of December, 1991.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 91-3108

Petitioner's proposed findings of facts Nos. 1, 2, 3, 4, 5, 8, 9, 11, 12, 13, and 14 have been adopted, in substance, insofar as material.

With respect to petitioner's proposed finding of fact No. 6, he was off and on the boat during the last two days. Before Mr. Bourgeois' arrival, it had been necessary to stay with the boat for security reasons.

With respect to petitioner's proposed finding of fact No. 7, the proof did not show that anybody asked the owner's name, address or phone number. Respondent testified he did not distribute this information because it "wasn't necessary, because the owner was going to be there." T.36.

With respect to petitioner's proposed finding of fact No. 10, the taking of evidence had closed and respondent was making legal argument.

With respect to petitioner's proposed finding of fact No. 15, respondent (who appeared pro se) answered a speculative question about what "could" happen.

COPIES FURNISHED:

Thomas Bell, Esquire Department of Business

Regulation

725 South Bronough Street Tallahassee, FL 32399-1007

H. N. "Cap" Fendig

205 Marina Drive

St. Simons Island, GA 31522

Henry M. Solares, Director Florida Land Sales, Condominiums and Mobile Homes

725 South Bronough Street Tallahassee, FL 32399-1000

Donald D. Conn, General Counsel Department of Business

Regulation

725 South Bronough Street Tallahassee, FL 32399-1000

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. 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.

Docket for Case No: 91-003108

Orders for Case No: 91-003108