STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA DEPARTMENT OF BUSINESS ) AND PROFESSIONAL REGULATION, ) DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 94-0779

)

BROOKS A. STRAWSER, )

)

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 April 15, 1994, via video teleconference. The hearing officer appeared in Tallahassee, Florida and the parties appeared in Miami, Florida.

APPEARANCES

For Petitioner: Theodore R. Gay, Senior Attorney

Department of Business and Professional Regulation

Division of Real Estate

401 Northwest 2nd Avenue, Suite N-607 Miami, Florida 33130

For Respondent: Sheldon R. Rosenthal, Esquire

1040 City National Bank Building

25 West Flagler Street Miami, Florida 33130

STATEMENT OF THE ISSUES

Whether Respondent violated Sections 475.25(1)(b) and (d)1, Florida Statutes, and, if so, what penalty should be imposed.

PRELIMINARY STATEMENT

On January 19, 1994, Petitioner, Florida Department of Business and Professional Regulation, Division of Real Estate (Department), filed an Administrative Complaint against Respondent, Brooks A. Strawser (Strawser), alleging that Strawser violated Sections 475.25(1)(b) and (d)1, Florida Statutes. Strawser requested a formal administrative hearing and the case was forwarded to the Division of Administrative Hearings for assignment to a hearing officer on February 11, 1994.

The case was heard by video teleconference. The Department presented the testimony of two witnesses, Bernard Moskowitz and Ira Witlin. Petitioner's

Exhibits 1-6 were admitted into evidence. Strawser testified in his own behalf. Respondent's Exhibits 1-7 were admitted into evidence.

At the conclusion of the hearing the parties agreed to file proposed recommended orders within twenty days after the filing of the transcript. The transcript was filed on May 17, 1994. Petitioner's proposed recommended order was filed on June 6, 1994. Respondent's proposed recommended order was filed on June 13, 1994. The parties' proposed findings of fact are addressed in the Appendix to this Recommended Order.

FINDINGS OF FACT

1. Petitioner, Florida Department of Business and Professional Regulation, Division of Real Estate (Department), is a state government agency charged with the responsibility and duty to prosecute administrative complaints pursuant to the laws of the State of Florida, in particular Section 20.165, Florida Statutes, and Chapters 120, 455, and 475, Florida Statutes, and the rules promulgated thereto.

   
   

2. Respondent, Brooks A. Strawser (Strawser), is now and was at all times material hereto a licensed real estate broker in the State of Florida having been issued license number 0412070 in accordance with Chapter 475, Florida Statutes.

   
   

3. The last license issued to Strawser was as a broker with a mailing address of 600 Biltmore Way, Suite 519, Coral Gables, Florida 33134-7530.

   
   

4. In January, 1992, Bernard Moskowitz (Moskowitz) entered into two property management agreements by which Strawser was to rent, lease, operate and manage properties owned by Moskowitz and his wife. The properties were the Sabrian Apartments at 45 Antilla Avenue and 42 Phoentia Avenue in Coral Gables and the Sunset Garden Apartments at 7101 Southwest 89th Court in Miami.

   
   

5. Strawser began performing services pursuant to the agreements in February, 1992. His responsibilities included collecting rent and security deposits from the tenants, issuing receipts for the monies received and disbursed in connection with the management of the properties, negotiating leases, and rendering itemized statements of receipts, expense charges and accruals to Moskowitz.

   
   

6. Strawser used the operating and the security accounts which Moskowitz maintained for each of the apartments for the deposit of rents and security deposits. Moskowitz was the only authorized signatory for the accounts.

   
   

7. Although the agreements called for Strawser to collect the rents and security deposits from the tenants, in practice the on-site building managers, who were paid by Moskowitz, performed those services. Strawser would receive the checks and money orders from the on-site managers and deposit them in the appropriate account. Deposit slips were made out in triplicate. Strawser would either mail or give Moskowitz the deposit slips and would give Moskowitz a monthly summary report. The bank would send Moskowitz the deposit slips and monthly statements.

   
   

8. By letter dated February 22, 1993, Strawser advised Moskowitz that he planned to withdraw from managing the apartments, effective March 31, 1993, or sooner if Moskowitz so desired. Strawser advised that by March 15 his firm would prepare all papers, letters, files, etc., to be handed over to the new

   management. He also advised that on or before March 31 he would present Moskowitz with all bank books, check books, etc., and conclude his fiscal responsibility upon payment of all professional fees due him.

   
   

9. After the agreements terminated, a dispute arose between Strawser and Moskowitz. Strawser claimed that Moskowitz owed him management fees pursuant to the Sunset Gardens Apartments Property Management Agreement for the month of February 1993, totalling approximately $1,000. Moskowitz claimed that Strawser miscalculated the amount and that the actual amount was less. Moskowitz also claimed setoffs exceeding $1,000 due to other matters. On January 7, 1994, Strawser filed a county court claim against Moskowitz, seeking $1,006.93 as the amount of the unpaid property management fees. At the time of the hearing, Moskowitz had not yet paid the fees.

   
   

10. Strawser waited to file the county court claim because he hoped to collect the fees without having to file a lawsuit.

    
    

11. Moskowitz hired Pacific Real Estate Management to succeed Strawser as property manager of the Sunset Gardens Apartments, beginning March 1, 1993. Strawser gave Lorna Lopez, office manager of Pacific Real Estate Management, the checkbook, estimates for repairs for hurricane damage and a folder on the manager for Sunset Gardens Apartments. Later, Ms. Lopez requested Strawser to give her any leases he had for Sunset Gardens Apartments. Strawser said he would give the leases to her in time after he had settled with Moskowitz. Ms. Lopez advised Moskowitz of her conversation with Strawser and Moskowitz called Strawser, who told Moskowitz that he would not turn over the records until he had been paid. Later, Ms. Lopez again requested the leases and Strawser advised her that he did not have any leases.

    
    

12. Moskowitz put the apartments located at 42 Phoentia Avenue up for sale. In May 1993, Moskowitz's attorney, Ira M. Witlin, contacted Strawser and requested that he release the records for the 42 Phoentia Avenue property. Strawser advised Mr. Witlin that Moskowitz owed him $1000 for management of the Sunset Gardens Apartments. He further told Mr. Witlin that he was not sure exactly what records he had, but if he were paid the money relating to his fees on the Sunset Gardens Apartments he would cooperate and look to see what records he had on the 42 Phoentia Avenue apartments. Mr. Witlin sent a letter dated June 2, 1993, to Strawser setting forth his recollection of their conversation. A few days after Mr. Witlin sent the letter, Strawser called Mr. Witlin advising that he had received the letter and requesting Mr. Witlin to call his attorney.

    
    

13. In February, 1993, Strawser received an insurance settlement check for hurricane damage to Sunset Gardens Apartments. He turned the check over to Moskowitz. In July, Strawser called Moskowitz and told him that he had received a check from the insurance company for hurricane damage to Sabrian Apartments. Strawser told Moskowitz that he would give him the insurance settlement check and the other documents if Moskowitz would give him the $1,000 which Strawser claimed he was owed. Moskowitz called the insurance company and requested that the insurance check be reissued. The insurance company reissued a check and sent it directly to Moskowitz.

    
    

    CONCLUSIONS OF LAW

    
    

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

15. The Department has the burden of proving by clear and convincing evidence all of the essential allegations against Strawser. See Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).

    
    

16. As they pertain to this proceeding, Sections 475.25(1)(b) and (d)1, Florida Statutes provide:

    
    

    1. The commission may deny an application for licensure, registration, or permit, or renewal thereof; may place a licensee, registrant, or permittee on probation; may suspend a license, registration, or permit for a period not exceeding 10 years; may revoke a license, registration, or permit; may impose an administrative fine not 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, registrant, permittee, or applicant:

       * * *

       (b) Has been guilty of fraud, misrepresentation, concealment, false promises, false 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 the 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 public.

       * * *

       (d)1. 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 . . . 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. . . .

       
       

17. As it pertains to this proceeding, Section 83.49(7), Florida Statutes, provides:

    
    

    (7) Upon the sale or transfer of title of

    the rental property from one owner to another, or upon a change in the designated rental agent, any and all security deposits or advance rents being held for the benefit of the tenants shall be transferred to the new owner or agent, together with any earned interest and with an accurate accounting showing the amounts to be credited to each tenant account. . . .

    
    

18. In Count I of the Administrative Complaint, the Department alleges that Strawser is guilty of concealment, culpable negligence or breach of trust in any business transaction or the violation of a duty imposed upon him by Section 83.49(7), Florida Statutes, or otherwise imposed upon him by law in a real estate transaction in violation of Section 475.25(1)(b), Florida Statutes.

    
    

19. The Department has established that Strawser violated Section 475.25(1)(b), Florida Statutes. Strawser intentionally concealed whether he had possession of any leases or other documents for either Sabrian Apartments or Sunset Gardens Apartments in an attempt to get Moskowitz to pay him $1,000 which he claimed he was owed pursuant to the agreement for managing Sunset Garden Apartments. Strawser had advised Moskowitz by letter that he would gather the documents relating to all the apartments by March 15, 1993, and he did deliver some documents to Ms. Lopez and to the on-site managers. Thus, it is inconceivable to believe that Strawser did not know whether he had any leases or other documents pertaining to the apartments when he was asked for them by Ms. Lopez and Mr. Witlin. Strawser also withheld the insurance settlement check from Moskowitz in an attempt to get money from Moskowitz and breached his duty to account for and deliver funds which he held in trust for Moskowitz.

    
    

20. In Count II of the Administrative Complaint, the Department alleged that Strawser failed to account or deliver personal property, documents and funds in violation of Section 475.25(1)(d)1, Florida Statutes.

    
    

21. The Department has established by clear and convincing evidence that Strawser violated Section 475.25(1)(d)1, Florida Statutes. Strawser failed to deliver the insurance check which he received on behalf of Moskowitz for the hurricane damage to the Sabrian Apartments. Strawser failed to account for all documents that he had in his possession relating to the Sunset Garden Apartments and to the Sabrian Apartments by failing to tell Moskowitz what documents he had in his possession which pertained to the Moskowitz properties when he was requested to turn over the documents to Moskowitz or his agents.

    
    

22. Pursuant to Section 475.25(1), Florida Statutes, and Rule 61J2-24.001, Florida Administrative Code, disciplinary action by the Florida Real Estate Commission may, as circumstances warrant, include any one or more of the following penalties: a reprimand; an administrative fine not to exceed $1,000

per violation; probation; suspension of license for a period not to exceed ten years; or revocation of license.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding that Brooks Strawser

violated Sections 475.25(1)(b) and (d)1, Florida Statutes and imposing the

following discipline:

1. Reprimand.

   
   

2. Administrative fine of $2,000.

   
   

3. One year probation, during which time Respondent must provide to the Florida Department of Business and Professional Regulation, Division of Real Estate, Legal Section, Hurston Building, North Tower, Suite N-308, 400 West Robinson Street, Orlando, Florida 32801-1772, satisfactory evidence of having completed a 30-hour postlicensure broker management course.

DONE AND ENTERED this 27th day of June, 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 27th day of June, 1994.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-779

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:

Petitioner's Proposed Findings of Fact.

1. Paragraphs 1-4: Accepted.

2. Paragraph 5: The first two sentences are accepted. The last three sentences are rejected as unnecessary detail.

3. Paragraphs 6-8: Accepted.

4. Paragraph 9: The first four sentences are accepted. The remainder of the paragraph is rejected as subordinate to the facts actually found.

5. Paragraph 10: Accepted in substance.

6. Paragraph 11: The first, second, third, and sixth

sentences are accepted in substance. The remainder of the paragraph is rejected as subordinate to the facts actually found.

Respondent's Proposed Findings of Fact.

1. Paragraphs 1-4: Accepted.

2. Paragraph 5: The first two sentences are accepted. The last three sentences are rejected as unnecessary detail.

3. Paragraphs 6-8: Accepted.

4. Paragraphs 9-10: Accepted in substance.

5. Paragraph 11: The first sentence is rejected as not supported by the greater weight of the evidence. The second sentence is accepted.

6. Paragraphs 12-13: Accepted in substance.

7. Paragraph 14: Rejected as not supported by the greater weight of the evidence.

8. Paragraphs 15-17: Rejected as constituting argument.

COPIES FURNISHED:

Theodore R. Gay, Esquire Department of Business and

Professional Regulation

401 Northwest 2nd Avenue, Suite N-607 Miami, Florida 33128

Sheldon R. Rosenthal, Esquire Suite 1040

City National Bank Building

25 West Flagler Street Miami, Florida 33130

Jack McRay

Acting General Counsel

Department of Business Regulation Northwood Centre

1940 North Monroe Street Tallahassee, Florida 32399

Darlene F. Keller Division Director Division of Real Estate

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

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: 94-000779

Orders for Case No: 94-000779