STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

RICHARD STEEL-REED, DONALD E. ) BLOCK, MARTIN-YOUNG PRIVATE )

INVESTIGATIVE AGENCY, INC., )

)

Petitioners, )

)

vs. ) CASE NO. 94-0863

)

DEPARTMENT OF BANKING AND ) FINANCE, DIVISION OF FINANCE, )

)

Respondent. )

)

RECOMMENDED ORDER

On June 15, 1994, a formal administrative hearing was held in this case in Largo, Florida, before J. Lawrence Johnston, Hearing Officer, Division of Administrative Hearings.

APPEARANCES

For Petitioner: Bruce G. Kaufmann, Esquire

11151 66th Street North, Suite 401

Largo, Florida 34643

For Respondent: Paul C. Stradler, Jr., Esquire

Assistant General Counsel Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32399

STATEMENT OF THE ISSUE

The issue in this case is whether the Petitioners established entitlement to $22,165 of abandoned property being held by the Respondent, the Department of Banking and Finance, Division of Finance, under Chapter 717, Fla. Stat. (1993).

PRELIMINARY STATEMENT

On or about October 15, 1993, the Respondent, the Department of Banking and Finance, Division of Finance, denied the Petitioners' claim to $22,165 of abandoned property being held by the Department under Chapter 717, Fla. Stat. (1993). On or about October 28, 1993, the Petitioners requested formal administrative proceedings under Section 120.57, Fla. Stat. (1993). The matter was not referred to the Division of Administrative Hearings (DOAH) until February 18, 1994. In accordance with the parties' joint response to the Initial Order in the case, the case was scheduled for final hearing on June 15, 1994.

At final hearing, the president of Martin-Young Private Investigative Agency, Inc., testified on behalf of the Petitioners. Counsel for the Petitioners also testified, without objection, to facts not in serious dispute. Petitioners' Exhibits 1 through 17 were admitted in evidence. The Department called one witness.

Although all of the Petitioners' exhibits were admitted in evidence, the Department objected to some of the exhibits, as well as some of the testimony, on grounds of the "best evidence rule" and on grounds of hearsay. At the hearing, ruling was reserved on the objections to the extent of the limitations on the use of the evidence. Rulings are contained in the Conclusions of Law.

At the conclusion of the hearing, the Department ordered the preparation of a transcript of the hearing and requested 14 days from the filing of the transcript in which to file proposed recommended orders. The transcript was filed on June 30, 1994. Neither party filed proposed findings of fact.

FINDINGS OF FACT

1. On or about December 21, 1992, the National Abandoned Property Processing Corporation delivered to the Department of Banking and Finance, Division of Finance, $22,165 in cash derived from the cash acquisition of McGraw-Edison Company on May 30, 1985, Cooper Industries, Inc. Cooper Industries indicated that the cash, representing $65 per common share for 341

   unexchanged shares, had been abandoned by Helen A. Block, 1116 North 13th Court, Hollywood, Florida 33019, and that the owner's account number was 000148084992, but Cooper Industries does not have a social security or tax identification number or any other information to identify the owner.

   
   

2. Richard Steel-Reed and Donald E. Block are the adult sons of, and heirs to the estate of, a Helen A. Block who died in California on August 6, 1989, after having resided in Chatsworth, California, for approximately three to five years. Prior to residing in California, and in particular in 1983, she resided at 3901 South Ocean Drive, Hollywood, Florida. But there is no evidence that she ever resided at 1116 North 13th Court, Hollywood, Florida 33019.

   
   

3. The Petitioners were unable to produce any stock certificates or account statements or any other evidence directly identifying their mother as the owner of the $22,165 at issue in this case.

   
   

4. The Petitioners were unable to prove, by a preponderance of the evidence, that their mother was the owner of the $22,165 at issue in this case.

   
   

   CONCLUSIONS OF LAW

   
   

5. Section 717.124(1), Fla. Stat. (1993), provides:

   
   

   Any person, excluding another state, claiming an interest in any property paid or delivered to the department under this chapter may file with the department a claim on a form prescribed by the department and verified by the claimant. The department shall determine each claim within 90 days after it is filed. Such determination shall contain a notice of rights provided by s. 120.57.

   As used in the statute, "the department" means the Department of Banking and Finance. Section 717.101(4), Fla. Stat. (1993).

   
   

6. Section 717.126, Fla. Stat. (1993), provides:

   
   

   Any person aggrieved by a decision of the department may petition for a hearing as provided in s. 120.57. In any proceeding for determination of a claim to property paid or delivered to the department under this chapter, the burden shall be upon the claimant to establish entitlement to the property by a preponderance of evidence.

   
   

7. Some of the evidence presented by the Petitioners in support of their claim was in the form of testimony and copies of documents to which the Department objected on grounds of the "best evidence rule," Section 90.952, Fla. Stat. (1993), which provides:

   
   

   Except as otherwise provided by statute, an original writing, recording, or photograph is required in order to prove the contents of the writing, recording, or photograph.

   
   

   (Emphasis added.) The "best evidence rule" objections are overruled. First, this was not a case to prove the contents of the documents that were utilized by the Petitioners. Even if it were, the document copies qualified as "duplicates" under Section 90.953, Fla. Stat. (1993); besides, Section 120.58(1)(d), Fla.

   Stat. (1993), provides for the following statutory exception to the "best evidence rule":

   
   

   Documentary evidence may be received in the form of a copy or excerpt if the original is not readily available.

   
   

8. Much of the evidence presented by the Petitioners in support of their claim was hearsay. As part of their investigation, they contacted various people named Helen Block and various relatives of people, both living and deceased, named Helen Block. At final hearing, the Petitioners presented the out-of-court statements of the people they contacted during their investigation. Section 120.58(1)(a), Fla. Stat. (1993), provides:

   
   

   Hearsay evidence may be used for the purpose of supplementing or explaining other evidence, but it shall not be sufficient in itself to support a finding unless it would be admissible over objection in civil actions.

   
   

   It is concluded that the Petitioners did not demonstrate or establish any hearsay exception that would make the hearsay admissible over objection in a civil action. As a result, the hearsay evidence was insufficient in itself to support a finding as to the truth of the matters asserted in the hearsay.

   
   

9. Even with the hearsay, the Petitioners would not have been able to prove their case. There are too many other possible explanations of the actual ownership of the abandoned property that could not be excluded by the Petitioners' evidence.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Respondent, the Department of Banking and Finance, enter a final order denying the Petitioners' claim to the $22,165 being held by the Department.

RECOMMENDED this 2nd day of August, 1994, in Tallahassee, Florida.

J. LAWRENCE JOHNSTON 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 2nd day of August, 1994.

COPIES FURNISHED:

Bruce G. Kaufmann, Esquire 11151 66th Street North Suite 401

Largo, Florida 34643

Paul C. Stradler, Jr., Esquire Assistant General Counsel Office of the Comptroller

The Capitol, Suite 1302 Tallahassee, Florida 32399

Honorable Gerald Lewis Comptroller

The Capitol, Plaza Level Tallahassee, Florida 32399-0350

William G. Reeves, Esquire General Counsel

Office of the Comptroller The Capitol, Room 1302 Tallahassee, Florida 32399

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit to the Department of Banking and Finance 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 consult

with the Department of Banking and Finance concerning its rules on the deadline for filing exceptions to this Recommended Order.

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AGENCY FINAL ORDER

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STATE OF FLORIDA DEPARTMENT OF BANKING AND FINANCE

DIVISION OF FINANCE

RICHARD STEEL-REED, DONALD E. BLOCK, MARTIN-YOUNG PRIVATE INVESTIGATIVE AGENCY, INC.,

Petitioners, Administrative Proceeding vs. No. 3175-F-11/93

DOAH Case No. 94-0863

DEPARTMENT OF BANKING AND FINANCE, DIVISION OF FINANCE,

Respondent.

/

FINAL ORDER

This matter has come before the undersigned as head of the Department of Banking and Finance, Division of Finance ("Department") for the entry of a final order in the above- referenced proceeding. On August 2, 1994, a hearing officer from the Division of Administrative Hearings ("DOAH") submitted his Recommended Order, a copy of which is attached hereto as Exhibit "A". The Department, on August 5, 1994, timely filed its exception to the Recommended Order. On or about August 15, 1994, Petitioners timely filed exceptions to the Recommended Order. On August 23, 1994, the Department timely filed its Response to petitioners' Exceptions to the Recommended Order.

RULING ON EXCEPTIONS BY THE DEPARTMENT

First exception: The Department takes exception to the Recommended Order's Findings of Fact paragraph 2 wherein the hearing officer concluded that the decedent, Helen Block, "resided at 3901 south Ocean Drive, Hollywood, Florida." The department argues that the basis for this particular finding is the hearsay evidence obtained from page 36, lines 10-16, of the transcript.

In Heifetz v. Department of Business Regulation, 475 So.2d 1277, 1281 (Fla.

1st DCA 1985), the District Court of Appeal explained the respective roles of hearing officers and state agencies in deciding factual issues as follows:

Factual issues susceptible of ordinary methods of proof that are not infused with policy considerations are the prerogative of the hearing officer as the finder of fact.

McDonald v Department of Banking and Finance,

346 So.2d 569 (Fla. 1st DCA 1977): It is the hearing officer's function to consider all the evidence presented, resolve conflicts, judge credibility of witnesses, draw permissible inferences from the evidence, and reach ultimate findings of fact based on competent, substantial evidence. State Beverage Department v. Ernal, Inc., 115 So.2d 566

(Fla. 3d DCA 1959). If, as is often the case, the evidence presented supports two inconsistent findings, it is the hearing officer's role to decide the issue one way or the other. The agency may not reject the hearing officer's finding unless there is no competent, substantial evidence from which the finding could reasonably be inferred. The agency is not authorized to weigh the evidence presented, judge credibility of witnesses, or otherwise interpret the evidence to fit its desired ultimate conclusion.

Furthermore, the Third District has held:

Hearsay evidence may be used to supplement or explain other evidence, [but) it is not sufficient in itself to support a finding unless it would be admissible over objection in civil actions.

Byer v. Florida Real Estate Commission, 380 So.2d 511, 512 (Fla. 3d DCA 1980). Petitioners submitted the out-of-court statements of the sons of a Helen A. Block to demonstrate that she--their mother- -lived at the south Ocean Drive address. These statements are hearsay, and while admissible in an administrative proceeding, are insufficient alone to carry the weight of the evidence.

Additionally, petitioners submitted pages from a city directory to show that a Helen A. Block resided at the south Ocean Drive address. While the hearing officer allowed the directory pages to come into evidence as nonhearsay, he would not be able to reasonably infer that the mother of petitioners Steel- Reed and Block resided at the South Ocean Drive address based upon the directory information and the hearsay evidence from the sons. He could only find that a Helen A. Block resided at that address from the directory information.

Therefore, the department adopts the exception and rejects the hearing officer's Finding of Fact, as to this particular finding, since it was not supported by competent, substantial evidence.

RULING ON EXCEPTIONS BY PETITIONERS

Petitioners' General Exceptions

The Petitioners, in their exceptions labeled (A) through (C), set forth in unnumbered pages 1 and 2 thereof, supply vague quotations with regards to various constitutional provisions. If it is petitioners' point to argue a constitutional challenge, then these exceptions are rejected insofar as administrative agencies are inappropriate forums to address these constitutional issues. See Myers v. Hawkins, 362 50. 2d 926, 928 (Fla. 1978).

In their exceptions labeled (C) and (D), petitioners make vague references to the burden of proof and argue that both the Department and the Division of Administrative Hearings forced petitioners to prove their claim beyond a reasonable doubt. For the reasons set forth in ruling on petitioners' numbered exception 18, infra, this exception is rejected.

Petitioners' Exceptions to Findings of Fact

Petitioners, in the section entitled "Findings of Fact," agree and disagree with certain facts and conclusions of the hearing officer. Disregarding where Petitioners are in agreement with the hearing officer, the Department rules on Petitioners' exceptions wherein they object as to the characterization of the evidence. With regards to Petitioners' specific exceptions to certain findings, the Department thus rules as follows:

First Exception: In numbered paragraphs 3 through 12 of Petitioners' exceptions to "Findings of Fact," Petitioners take exception to the Recommended Order's Findings of Fact paragraph 2 wherein the hearing officer concluded that "there is no evidence that she ever resided at 1116 North 13th Court, Hollywood, Florida 33019." The Petitioners argue that the evidence was misstated and misleading in that its purpose was to demonstrate that the address was invalid.

The abandoned property report from the National Abandoned property processing Corporation for Cooper Industries, Inc. (formerly McGraw-Edison)(Pet. Ex. 5), by which the Department and Petitioners were notified that the property existed, shows that a Helen A. Block, of 1116 N. 13th Ct., Hollywood, Florida 33019, is the holder of account number 000148084992 containing 341.00 shares of stock, valued at $22,165.00.

The Finding of Fact by the hearing officer states, in essence, that petitioners have failed to demonstrate by a preponderance of the evidence that their Helen A. Block was the Helen A. Block who resided at 1116 North 13th court, Hollywood, Florida, and who was reported as owner of the property. Even if the evidence was misstated, as petitioners contend, the out of court statements made by purported former and current residents of the North 13th Court address are hearsay. Alone, this evidence is insufficient to support a finding that the Helen A. Block related to Petitioners Steel-Reed and Block resided at the North 13th Court address. Byer v. Florida Real Estate Commission, 380 So.2d 511, 512 (Fla. 3d DCA 1980).

Statements made by family members that their Helen A. Block never resided at the North 13th Court address are also hearsay. While statements by family members may be an exception to the hearsay rule, no declarant provided sworn testimony to this fact. Mr. Dotzler, who is not a family member, relayed the statements purportedly made by family members and others. Therefore, the hearing officer's Finding of Fact paragraph 2, is supported by competent, substantial evidence. Heifetz, 475 So.2d at 1281. Petitioners' exception is rejected.

Second Exception: In paragraph 18 of the exceptions to "Findings of Fact," Petitioners take exception to the Recommended Order's Findings of Fact paragraph

4 wherein the hearing officer concluded that petitioners were unable to prove, by a preponderance of the evidence, that their mother was the owner of the

$22,165 at issue." The Petitioners argue that the state is "enforcing a stricter burden on the Petitioner than is required by law."

The test for proof by a preponderance of the evidence is well-settled in Florida:

Our test of preponderance of the evidence is qualitative more than quantative (sic).

The phrase necessarily implies that the evidence must "satisfy the mind of the jury" such as to "lead a reasonably cautious man to that conclusion" "produce a reasonable belief" and "convince as of its truth."

Saporito v. Bone, 195 So.2d 244 (Fla. 2d DCA 1967). While Petitioners have provided a quantity of evidence, the quality is insufficient to meet the burden of proof. Petitioners' evidence is hearsay and is unsupported by nonhearsay evidence. See Byer, 380 So.2d at 512. The hearing officer's Finding of Fact is accepted as being supported by competent, substantial evidence, and Petitioners' exception is rejected. Heifetz, 475 So.2d at 1281. Petitioners' constitutional challenge is also rejected upon the same grounds, insofar as administrative agencies, such as this one, are inappropriate forums for deciding constitutional issues. Myers, 362 So.2d at 928.

Third Exception: In paragraphs 19 through 21 of the exceptions to "Findings of Fact," Petitioners take exception to the Recommended Order's Conclusion of Law paragraph 8 in which the hearing officer concluded that "There are too many other possible explanations of the actual ownership of the abandoned property that could not be excluded by the petitioners' evidence." Petitioners argue that they demonstrated by a preponderance of the evidence that their Helen A. Block was the owner of the property. Also, petitioners argue that they proved that all other known Helen A. Blocks made admissions against interest by purportedly denying any knowledge of the property.

The Department's ruling on Petitioners' Second Exception is adopted as to this exception. The Department rejects Petitioners' Third Exception on the same grounds.

As to Petitioners' argument regarding the purported "admissions" against interest by other Helen A. Blocks, Petitioners inappropriately rely upon the hearsay exception under section 90.804(4)(2)(c), Florida statutes, "Declarations Against Interest." In order to admit hearsay evidence under this exception, the party offering the evidence must demonstrate that the declarant is unavailable. Ehrhardt, Florida Evidence 804.4 (1994 Ed.). The Petitioners did not establish that the declarants--"all other Helen A. Blocks " --were unavailable to testify as to their denial of ownership of the property. Therefore, the statements are hearsay. Thus, the Department accepts the hearing officer's conclusion of law and rejects Petitioners' exception.

Fourth Exception: In paragraph 23 of the exceptions to "Findings of Fact," Petitioners take exception to the Recommended Order's Conclusions of Law paragraphs 8 and 9 wherein the hearing officer concluded that the out-of-court statements of people contacted during petitioners' investigation are hearsay.

Petitioners' argue that the hearing officer and the state "show their unfamiliarity with the hearsay rule and its exceptions."

As addressed above with regard to Petitioners' First Exception, the out-of- court statements by purported family members, neighbors, and former and current

residents of the referenced addresses, as testified to by Mr. Dotzler, fail to come under any exception to the hearsay rule. Therefore, Petitioners' exception is rejected, and the Department accepts the hearing officer's conclusions of law.

ORDER

UPON review and consideration of the Recommended Order and the complete record of this proceedings and having considered and ruled upon the parties exceptions, it is accordingly ORDERED:

1. The hearing officer's Findings of Fact and Conclusions of Law as set forth in the attached Recommended Order are hereby adopted and corporated herein, except as modified by the rulings on the exceptions, as the Findings of Fact and Conclusions of Law of this Final Order; and

   
   

2. The claim of Martin-Young Private Investigative Agency, Inc., on behalf of Richard Steel-Reed and Donald E. Block for the abandoned property in the amount of $22,165 held by the Department, is hereby denied.

DONE and ORDERED this 26th day of October, 1994, in Tallahassee, Leon County, Florida.

GERALD LEWIS, as Comptroller of the State of Florida and Head of the Department of Banking and Finance

COPIES FURNISHED:

J. Lawrence Johnston Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

Linda G. Dilworth, Director, Division of Finance

Paul C. Stadler, Jr. Assistant General Counsel

NOTICE OF RIGHT TO JUDICIAL REVIEW

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK AND A SECOND COPY, ACCOMPANIED BY FILING FEES PRESCRIBED BY LAW, WITH THE FIRST DISTRICT COURT OF APPEAL. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Final Order and Notice of Rights has been furnished by regular U.S. mail to Bruce G. Kaufman, Esquire, 11151 66th street North, suite 401, Largo, Florida 34643, this 26th day of October, 1994.

J STRATIS PRIDGEON

Certified Legal Intern

H. RICHARD BISBEE Deputy General Counsel

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DISTRICT COURT OPINION

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IN THE DISTRICT COURT OF APPEAL FIRST DISTRICT, STATE OF FLORIDA

RICHARD STEEL-REED, DONALD E. NOT FINAL UNTIL TIME EXPIRES TO BLOCK, MARTIN-YOUNG PRIVATE FILE MOTION FOR REHEARING AND INVESTIGATIVE AGENCY, INC., DISPOSITION THEREOF IF FILED

Appellants, CASE NO: 94-3871

DOAH CASE NO: 94-0863

v.

DEPARTMENT OF BANKING AND FINANCE DIVISION OF FINANCE,

Appellee.

/

Opinion filed July 20, 1995.

An appeal from a final order of the Department of Banking and Finance, Division of Finance. Gerald Lewis, Comptroller of the State of Florida.

Bruce G. Kaufman, Largo, for Appellants.

Paul C. Stadler, Jr., Assistant General Counsel, Office of the Comptroller, Tallahassee, for Appellee.

PER CURIAM.

AFFIRMED.

ZEHMER, C.J., ALLEN and KAHN, JJ., CONCUR.

MANDATE

From

DISTRICT COURT OF APPEAL OF FLORIDA FIRST DISTRICT

To the Honorable Gerald Lewis, Comptroller State of Florida Department of Banking Finance

WHEREAS in that certain cause filed in this Court styled: RICHARD STEEL-REED, DONALD E.

BLOCK, MARTIN-YOUNG PRIVATE

INVESTIGATIVE AGENCY, INC.

vs. Case No. 94-3871

Your Case No. 94-0863

DEPARTMENT OF BANKING AND FINANCE, DIVISION OF FINANCE

The attached opinion was rendered on July 20, 1995

YOU ARE HEREBY COMMANDED that further proceedings be, had in accordance with said opinion, the rules of this Court and the laws of the State of Florida.

WITNESS the Honorable E Earle Zehmer

Chief Judge of the District Court of Appeal of Florida, First District and the Seal of said court at Tallahassee, the Capitol, on this 7th day of August, 1995

Karen Roberts

Deputy Clerk, District Court of Appeal of Florida, First District

Docket for Case No: 94-000863

Orders for Case No: 94-000863