STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

IN RE: ILENE LIEBERMAN, )

) CASE NO. 93-1180EC

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, Susan B. Kirkland, held a formal hearing in this case on December 7 and 8, 1993, in Fort Lauderdale, Florida.

APPEARANCES

For Respondent: Stuart R. Michelson, Esquire

1111 Kane Concourse, Suite 517

Bay Harbor Islands, Florida 33154

For Complainant: Anthony J. Titone, Esquire

7471 West Oakland Park Boulevard Fort Lauderdale, Florida 33319

STATEMENT OF THE ISSUES

Whether Irene Lieberman is entitled to attorney fees and costs from Lorenzar Brown, as provided in Section 112.317(8), Florida Statutes, and if so, the amount.

PRELIMINARY STATEMENT

On or about October 3, 1992, Lorenzar Brown (Brown) filed a complaint with the Florida Commission on Ethics (Commission) containing allegations of misconduct by Ilene Lieberman (Lieberman) as Mayor of Lauderhill. The Executive Director of the Commission recommended that the Complaint be dismissed on the ground that the allegations in the Complaint were legally insufficient to indicate a violation of Section 112.313(6), Florida Statutes. On February 2, 1993, the Commission entered a Public Report and Order, dismissing the Complaint.

On or about February 18, 1993, Lieberman filed a Verified Petition for Attorney's fees and Costs with the Commission. The Commission referred the petition to the Division of Administrative Hearings for assignment to a hearing officer.

The case was originally assigned to Hearing Officer Mary Clark. The case was scheduled for final hearing on August 3, 1993, rescheduled for August 23, 1993, and again rescheduled for December 7, 1993. The case was transferred to Hearing Officer Susan B. Kirkland.

At the final hearing Lieberman testified in her own behalf and called the following witnesses: Arthur M. Wolff, Marcia Berkely, Richard J. Kaplan, Samuel Goren, Jeffery Pheterson, Leroy Bates, Richard Michelson, Richard Korte, Theresa

Gillis, Desorae Giles, Donald Giancoli, Lorenzar Brown, Mary Margaret Bates, and Tyson T. Jones. Lieberman's Exhibits 1-15 were admitted in evidence. Brown called Michael Arciola and Alan Brown as witnesses and Brown's exhibits 1-8 were admitted in evidence.

At the final hearing, Lieberman was given leave to file on or before January 15, 1994, the deposition of an expert witness to rebut the testimony of Michael Arciola who was qualified as an expert witness at the final hearing but who had not been designated as an expert in the prehearing stipulation. The deposition of Thomas Bradley was filed on January 11, 1994.

At the final hearing the parties agreed to file proposed recommended orders on or before February 15, 1994. A transcript was filed. The parties timely filed their proposed recommended orders. The parties' proposed findings of fact are addressed in the appendix to this Recommended Order.

FINDINGS OF FACT

1. At all times relevant to this proceeding, Ilene Lieberman (Lieberman) served as mayor of the City of Lauderhill, Florida (City).

   
   

2. The City and Broward County entered into an agreement (Grant) in January, 1992, for a Self-Help Home Ownership and Repair Program in the amount of $117,500, which provided for funding and administration of Community Development Block Grant (CDBG) projects. Pursuant to the Grant, the City would be reimbursed for allowable project expenses.

   
   

3. On July 13, 1992, the City Commission passed Ordinance No. 92-161, which approved budget adjustment BA 92-86 for the transfer of $123,000 from various budget accounts to establish the budget for the CDBG program.

   
   

4. When entering the CDBG budget into the City's computer system, the data entry operator made some coding errors. Budget adjustment BA-92-86 showed that

   $22,500 was to be budgeted for account number 3110. However, when it was keyed into the computer system, the $22,500 was coded to account number 3121, which was the account for the City Attorney's hourly charges. No funds were entered as budgeted for account number 3110. Budget adjustment BA-92-86 showed that

   $25,000 was to be budgeted for account number 3122. However, when keying the entry, the data entry operator entered $25,500 instead of the $25,000.

   
   

5. Lorenzar Brown (Brown), the Respondent, obtained a copy of the City Expenditure Status Report for July, 1992 (July Expenditure Report). The report reflected the errors that were made when the budget information was placed in the computer system. The report indicated that there were no expenditures made from account number 3121, the account for the City Attorney hourly charges.

   
   

6. In July or August, 1992, Brown talked to Marcia Berkely, who was the City Planner, concerning whether CDBG funds were being used to pay City Attorney fees. Ms. Berkely advised Brown that the CDBG funds were not being used to pay the City Attorney. Brown did not show Ms. Berkely the July Expenditure Report.

   
   

7. On August 31, 1992, Brown made a presentation to the City Commission, expressing his "concerns about the present taxpayer's dollars being expended to pay fees to the city attorney of the City of Lauderhill." Brown referenced the City's July Expenditure Report, stating, "In reviewing the monthly expenditure report for July, there was a number of other accounts budgeted to the city attorney."

8. In particular Brown was concerned about CDBG funds being used for City Attorney's fees. Brown stated:

   
   

   This last month an additional $40,000.00 of Community Development Block Grant was recom- mended by the Mayor and approved by the City Commission to be used for city attorney fees. This also passed by the Ordinance 92-161.

   The community, especially the taxpayers, request that the City Commission look into or investigate the action of the Mayor, on the part of the Mayor in recommending that

   the City Commission use Block Grant Funds for the city attorney fees contrary to the contract approved by the Commission by Resolution 91-83 which was passed on July 13th, 1992.

   
   

9. Brown's presentation was made during the communications from the public portion of the City Commission meeting. According to the policy of the City Commission, the Mayor and City Commission members are not allowed to respond to comments made during this portion of the meeting. Comments from the public officials are made during communications from the public officials portion of the meeting. Lieberman asked the Vice Chair of the City Commission to allow her to respond to Brown's presentation immediately after Brown concluded but she was not allowed to do so. Brown was unable to stay for the comments from the public officials because he had to pick up his daughter. He apologized to the Commission and told them that he had to leave.

   
   

10. During the comments from public officials, Lieberman explained the purpose of the Community Development Block Grant Program. She stated that

    $40,000 was not used for City Attorney fees but that the CDBG budget did include a line item for "legal matters that are incident to home ownership." She invited the public to spend time with her and Marcia Berkely to discuss the attorney fees issue.

    
    

11. By memorandum dated September 8, 1992, Brown advised the City Commission that he had not received a response from the Mayor's office concerning his request made on August 31, 1992, that the City Commission "investigate the propriety of the Mayor's office in recommending that the City Commission use BLOCK GRANT FUNDS for the City's Attorney fees. (92-161)." Brown did not reference the July Expenditure Report.

    
    

12. By letter dated September 16, 1992, Richard J. Kaplan (Kaplan), Commission Vice Chair, advised Brown that the Mayor had responded to Brown's comments at the City Commission meeting on August 31, 1992, and attached a copy of the minutes of the meeting. Kaplan additionally told Brown that he had checked the ordinances cited by Brown and found that one was in error. By memorandum dated September 16, 1992, Kaplan forwarded a copy of Brown's September 8 correspondence to Lieberman and requested that she respond to Brown in writing.

13. By letter to Kaplan dated September 21, 1992, Brown stated that he had reviewed the ordinances and the information submitted to Kaplan, that they were correct and that if the City Commission failed to investigate his allegations, that "the concern (sic) residents of Lauderhill will be compelled to file a complaint with the Ethics Commission and or the Bar Association." Brown did not reference the July Expenditure Report.

    
    

14. Lieberman responded to Brown by letter dated September 29, 1992. She attached a copy of the budget for the CDBG program, budget adjustment request BA 92-86, Ordinance 92-161, and a portion of the transcript of the August 31, 1992, City Commission meeting. She advised that there had been no misappropriation of City funds and that according to the budget adjustment $5,500 was coming from the City Attorney's budget to the CDBG budget as matching funds from the City for the program. The budget adjustment contained a $25,000 line item for legal services for closing costs, and included the $5,500 from the City Attorney's budget. She invited Brown to contact her directly if he had any further questions. She did not review the July Expenditure Report in the preparation of her response.

    
    

15. Brown never contacted Lieberman after the August 31 City Commission meeting to resolve any questions that he may have had. Based on prior dealings with her, he felt that she made him feel small and little and that she embarrassed and belittled him at City Commission meetings; therefore he did not feel comfortable directly asking her questions concerning the attorney fees issue.

    
    

16. Brown never asked anyone in the City's finance department, including Donald Giancoli, the Director of Finance, Assistant City Administrator for the City, to explain the differences between budget adjustment 92-86 and the July Expenditure Report.

    
    

17. On October 3, 1992, Brown executed Commission on Ethics Complaint No. 92-157 against Lieberman, alleging that she had violated Section 112.313(6), Florida Statutes, in that she "breached the public trust by solicitation in recommending that the City Commission Board use Community Block Grant funds for the City Attorney fees." On November 12, 1992, Brown executed an amendment to Complaint No. 92-157, enclosing additional information, which included a copy of the July Expenditure Report.

    
    

18. Prior to filing the Complaint, Brown spoke with Theresa Gillis, the Director of the Community Development Division of Broward County. She administered the Community Development Block Grant Programs for the County including the Grant to the City of Lauderhill. He told her that the City had violated the terms of the Grant by getting reimbursed for attorney's fees. He did not reference the July Expenditure Report. Ms. Gillis checked the reimbursements made to the City and found that the City had not violated their obligations under the CDBG Program. If she had been aware of the July Expenditure Report showing funds being budgeted to the City Attorney account, she would have been concerned and asked the City for an explanation.

    
    

19. On December 7, 1992, the Executive Director of the Florida Commission on Ethics issued a Recommendation of Legal Insufficiency, stating that the allegations in Complaint No. 92-157 were legally insufficient to indicate a possible violation of Section 112.313(6), Florida Statutes. On February 2, 1993, the Chairman of the Commission on Ethics filed a Public Report and Order

    Dismissing Complaint, stating that on January 28, 1993, the Commission on Ethics voted to adopt the Executive Director's legal sufficiency analysis and to dismiss Complaint No. 92-157.

    
    

20. On January 19, 1993, Brown filed a complaint with The Florida Bar against Lieberman. The complaint stemmed from remarks Lieberman made at a December 7, 1992 City Commission meeting. The Florida Bar declined to pursue the matter, determining that his complaint did not reveal any violations of the Rules Regulating Attorneys.

    
    

21. On February 18, 1993, Brown filed a lawsuit against Lieberman, alleging that she had defamed him in the December 7, 1992 meeting.

    
    

22. During the January 25, 1993, City Commission meeting, Brown publicly stated that he would personally support a recall petition against Lieberman. He took this position due to Lieberman's comments against him at the December 7, 1992, meeting.

    
    

23. Around the time that Lieberman first became mayor in 1988, she and Brown had some discusssions concerning a citation which he had received from the code enforcement board for failure to pay for garbage service at his premises. Brown was very angry and accused Lieberman of violating his constitutional rights.

    
    

24. At a City Commission meeting in approximately September, 1992 while Lieberman was responding to a question, Brown told the gentleman seated next to him that she was lying. Brown's voice was loud enough that it was heard twenty feet away by Richard Korte, the Director for Code Enforcement for the City.

    
    

25. After Brown filed the complaint against Lieberman, City Attorney Richard Michelson represented Lieberman as Mayor in his role as City Attorney. The City paid for these services out of the City Attorney's monthly $3,500 retainer. The total number of hours provided by the City Attorney relating to Brown's complaint and the instant fee proceeding was 23.1 hours.

    
    

26. After Brown's complaint was dismissed, Samuel Goren was retained to represent the Mayor. Mr. Goren filed the instant fee petition. The total number of hours for Mr. Goren's law firm was 16.2 hours.

    
    

27. After the fee petition was filed, Stuart Michelson (no relation to Richard Michelson) was retained to represent the Mayor. The total number of hours for Stuart Michelson through November 18, 1993 was 33.675. The total number of hours spent in hearing by Stuart Michelson was 17.5 hours, which included closing argument by telephone conference. Stuart Michelson spent one hour in taking the deposition of Thomas Bradley. Stuart Michelson's law clerk provided 5.45 hours of services.

    
    

28. Each of the attorneys providing services in representing Lieberman in the complaint by Brown and in the fee petition charged the City at $125 per hour. The services of the law clerk were billed at $50 per hour.

    
    

29. The City paid for the services provided through November 18, 1993.

    
    

30. Jeffery Pheterson, who was qualified as an expert on attorney's fees issues, opined that based on the rates customarily charged locally the rate of

    $125 per hour is a modest, reasonable rate for the services provided by the attorneys. He also opined that the rate of $50 per hour for paralegal services

    was also a reasonable rate for the services provided. At the final hearing, counsel for Brown stipulated that the rates for Stuart Michelson and Samuel Goren were reasonable. The rates of $125 per hour for attorney services and $50 for paralegal services are reasonable rates for similar services in the community.

    
    

31. Mr. Pheterson opined that the 23.1 hours of service provided by Richard Michelson, City Attorney, the 16.2 hours of service provided by Samuel Goren's firm, the 33.675 hours provided by Stuart Michelson and the 5.45 hours provided by Stuart Michelson's law clerk were reasonable. The hours of service provided by the above attorneys and law clerk through November 18, 1993, were reasonable. Additionally, the 17.5 hours spent by Stuart Michelson at the final hearing is reasonable and the one hour spent in taking the deposition of Thomas Bradley was reasonable.

    
    

    CONCLUSIONS OF LAW

    
    

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

    
    

33. Section 112.317(8), Florida Statutes, provides:

    
    

    In any case in which the commission determines that a person has filed a complaint against a public officer or employee with a malicious intent to injure the reputation of the officer or employee and in which such complaint is found

    to be frivolous and without basis in law or fact, the complainant shall be liable for costs plus reasonable attorney's fees incurred by the person complained against. If the complainant fails to pay such costs voluntarily within 30 days following such finding and dismissal of the complaint by the commission, the commission shall forward such information to the Department of Legal Affairs,

    which shall bring a civil action to recover such costs.

    
    

34. Rule 34-5.029(3), Florida Administrative Code provides:

    
    

    The respondent has the burden of proving the grounds for an award of costs and attorney's

    fees by a preponderance of the evidence presented at the hearing. 'Malicious intent to injure the reputation' may be proven by evidence showing ill will or hostility as well as by evidence showing that the complainant intended to bring discredit upon the name or character of the respondent by filing such complaint with knowledge that the complaint contained one or more false allegations

    or with reckless disregard for whether the complaint contained false allegations of fact material to a violation of the Code of Ethics for Public Officers and Employees. Such reckless disregard exists where the complainant entertained serious doubts as to the truth or falsity of the allegations, where the complainant imagined or fabricated the allegations,

    or where the complainant filed an unverified anonymous tip or where there are obvious reasons to doubt the veracity of the information or that of the source of the information.

    
    

35. Lieberman has proved by a preponderance of the evidence that Brown's complaint against Lieberman was without basis in law and fact. The facts as alleged by Brown did not support any violation of Chapter 112, Florida Statutes. There were no facts to support the allegation that Lieberman as mayor had recommended that funds be budgeted from the CDBG program to the City Attorney. Lieberman's recommendation was for budget adjustment 92-86, which did not include money being budgeted from CDBG funds to the City Attorney.

    
    

36. Lieberman has failed to establish by a preponderance of the evidence that Brown filed the ethics complaint against her with a malicious intent to injure her reputation. Brown found a discrepancy between budget adjustment 92-

    86 and the July Expenditure Report. He told Ms. Gillis and Ms. Berkely that he thought that CDBG funds were being expended for the City Attorney. Since no such funds had been expended, both Ms. Gillis and Ms. Berkely told him that the expenditures from the CDBG program were proper. Brown may not have been as articulate with Ms. Gillis and Ms. Berkely as he could have been when he tried to explain the problem, but in his mind and on paper there existed a discrepancy between budget adjustment 92-86 and the July Expenditure Report.

    
    

37. When Brown appeared before the City Commission on August 31, 1992, he did state that he had reviewed the July Expenditure Report. However, Lieberman in responding to Brown's August 31 request for an investigation did not check the July Expenditure Report. Lieberman argues that she did not check the expenditure report because Brown never asked her about it, but he did ask the City Commission when he made his presentation.

    
    

38. The July Expenditure Report was in error and Brown knew that CDBG funds should not be budgeted to the City Attorney. He attempted to raise this issue at the August 31 City Commission meeting when he told the City Commissioners and the Mayor that he had reviewed the July Expenditure Report. Lieberman's explanation both at the August 31 meeting and in her written response dated September 29 did not address the July Expenditure Report.

    
    

39. Lieberman argues that Brown had ill will toward her at the time he filed the ethics complaint because he later filed a civil action against her and a bar complaint against her. These actions were commenced after Lieberman made remarks at the December 7, 1992 City Commission about Brown and the CDBG program. Brown's position concerning a recall petition was also prompted by Lieberman's December 7 remarks. These actions may show that after December 7, 1992, Brown definitely had some ill feelings toward Lieberman, but they do not establish that when he filed the ethics complaint in October, 1992, that he did so with ill will or hostility against Lieberman.

    
    

40. Brown's demeanor at the August 31 City Commission was respectful and did not demonstrate any ill will or hostility against Lieberman. Lieberman attempts to make the argument that Brown did not stay to hear Lieberman's remarks at the August 31 meeting because he did not want to listen to what she had to say. This argument is without merit. Brown apologized at the meeting, stating that he would be unable to stay. The unrebutted testimony was that Brown did not stay because he had to pick up his daughter.

41. Brown's comments at the September, 1992, City Commission meeting which Mr. Korte overheard are not sufficient to demonstrate by a preponderance of the evidence that Brown had a malicious intent to injure Lieberman's reputation when he filed the ethics complaint. The dispute between Brown and Lieberman over garbage service is too remote in time to demonstrate ill will or hostility by Brown when he filed the ethics complaint.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered denying Ilene Lieberman's

Verified Petition for Attorney's Fees and Costs.

DONE AND ENTERED this 6th day of December, 1994, in Tallahassee, Leon County, Florida.

SUSAN B. KIRKLAND

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 6th day of December, 1994.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-1180EC

To comply with the requirements of Section 120.59(2), Florida Statutes (1993), the following rulings are made on the parties' proposed findings of fact:

Respondent Lieberman's Proposed Findings of Fact.

1. Paragraph 1: Accepted in substance.

2. Paragraph 2: Accepted.

3. Paragraphs 3-25: Accepted in substance.

4. Paragraph 26: Rejected as subordinate to the facts actually found.

5. Paragraphs 27-29: Accepted in substance.

6. Paragraph 30: Rejected as subordinate to the facts actually found.

7. Paragraph 31-33: Accepted in substance.

8. Paragraphs 34-35: Rejected as constituting argument.

9. Paragraphs 36-37 Accepted in substance.

10 Paragraph 38: Rejected as constituting argument.

1. Paragraphs 39-40: Rejected as constituting recitation of testimony.

2. Paragraph 41: Rejected as constituting argument.

3. Paragraph 42: Rejected as subordinate to the facts actually found.

4. Paragraph 43: Rejected as constituting recitation of testimony.

5. Paragraph 44: Accepted in substance.

6. Paragraph 45: Rejected as subordinate to the facts actually found.

7. Paragraphs 46-47: Accepted in substance.

8. Paragraph 48: The first sentence is rejected as not supported by the greater weight of the evidence. The second sentence is accepted to the extent that he filed the complaint because his concerns were not answered but rejected to the extent that it states that he filed the complaint a day or two after he received Lieberman's letter.

9. Paragraph 49: Rejected as not supported by the greater weight of the evidence. Brown knew that the July Expenditure Report showed funds being budgeted from the CDBG program to the City Attorney. The second sentence is rejected as subordinate to the facts actually found.

10. Paragraphs 50-51: Rejected as subordinate to the facts actually found.

11. Paragraphs 52-55: Accepted in substance.

12. Paragraph 56: Accepted in substance to the extent that Brown never told Lieberman personally that the expenditure report showed money going to the City Attorney, but rejected to the extent that he never referenced the expenditure report in her presence because he did at the August 31, 1992, City Commission meeting.

13. Paragraph 57: Rejected as subordinate to the facts actually found.

14. Paragraph 58: Rejected as cumulative.

15. Paragraphs 59-69: Accepted in substance.

16. Paragraphs 70-71: Rejected as constituting argument.

17. Paragraphs 72-73: Rejected as mere recitation of testimony.

18. Paragraphs 74-75: Accepted in substance.

19. Paragraphs 76-77: Rejected as mere recitation of testimony.

20. Paragraph 78: Accepted in substance to the extent that he refers to the ordinance but not as to the expenditure report. Lieberman did not address the expenditure report which Brown referenced in the August

    31 meeting.

21. Paragraph 79: Rejected as subordinate to the facts actually found.

22. Paragraphs 80-81: Accepted in substance.

23. Paragraphs 82-88: Rejected as constituting argument.

24. Paragraph 89: Rejected as subordinate to the facts actually found.

25. Paragraphs 90-92: Rejected as constituting argument.

26. Paragraph 93: Accepted in substance to the extent that there was a posting error.

27. Paragraphs 94-95: Rejected as constituting argument.

28. Paragraph 96: Accepted in substance.

29. Paragraph 97: Rejected as not supported by the greater weight of the evidence.

30. Paragraph 98: Accepted in substance.

31. Paragraph 99: Rejected as subordinate to the facts actually found.

32. Paragraphs 100-102: Rejected as constituting argument.

Complainant Brown's Proposed Findings of Fact.

1. Paragraphs 1-3: Accepted in substance.

2. Paragraph 4: The first sentence is accepted in substance. The second sentence is accepted to the extent that the responses did not make any reference to the July Expenditure Report which Brown brought up during his presentation at the August 31,

   1992, City Commission meeting. The third sentence is accepted in substance to the extent that Brown let Kaplan know that he was not satisfied

   with the responses.

3. Paragraphs 5-6: Rejected as subordinate to the facts actually found.

4. Paragraph 7: The first sentence is accepted to the extent that Brown had a copy of the Expenditure Status Report prior to the August 31, 1992, City Commission meeting and rejected as not supported by the greater weight of the evidence that Brown received the document from the City's finance department. The evidence is not clear how Brown received the document. The last sentence is accepted in substance.

5. Paragraphs 8-10: Accepted in substance.

6. Paragraph 11: The first and third sentences are accepted in substance. The second sentence is accepted in substance except that the July Expenditure Report was not attached to the original complaint but to an amendment to the complaint.

7. Paragraph 12: Accepted in substance to the extent that Lieberman personally did not expend funds or was obligated to pay the attorney's fees.

8. Paragraph 13: Rejected to the extent that his services were included in his retainer fee.

9. Paragraph 14: Accepted in substance.

COPIES FURNISHED:

Stuart R. Michelson, Esquire 1111 Kane Concourse, Suite 517

Bay Harbor Islands, Florida 33154

Anthony J. Titone, Esquire

7471 West Oakland Park Blvd., Suite 110 Ft. Lauderdale, Florida 33319

Bonnie Williams Executive Director

Florida Commission On Ethics Post Office Drawer 15709 Tallahassee, Florida 32317-5709

Phil Claypool, Esquire General Counsel

Ethics Commission

2822 Remington Green Circle, Suite 101 Post Office Drawer 15709

Tallahassee, Florida 32317-5709

Carrie Stillman Complaint Coordinator Commission on Ethics Post Office Box 15709

Tallahassee, Florida 32317-5709

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 ten 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.

Docket for Case No: 93-001180EC

Orders for Case No: 93-001180EC