STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF STATE, DIVISION ) OF LICENSING, )

)

Petitioner, )

)

vs. ) CASE NO. 94-1636

) SET-TEL MARKETING, INCORPORATED, )

JOAN IGNELZI, Agent/Owner, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on June 21, 1994, at Fort Lauderdale, Florida, before Michael M. Parrish, a Hearing Officer of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Henri C. Cawthon, Esquire

Department of State Division of Licensing

The Capitol, Mail Station Number 4 Tallahassee, Florida 32399-0250

For Respondent: Ms. Joan Ignelzi, Agent

SET-TEL Marketing, Incorporated 1951 northwest 35th Avenue Coconut Creek, Florida 33066

STATEMENT OF THE ISSUE

This is a disciplinary proceeding in which the Petitioner seeks to take disciplinary action against the Respondent on the basis of alleged violations of Section 849.094, Florida Statutes, set forth in a two-count Administrative Complaint.

PRELIMINARY STATEMENT

At the formal hearing in this case the Petitioner presented the testimony of two witnesses 1/ and offered two exhibits. One of the Petitioner's exhibits was received in evidence; the other was rejected. 2/ The Respondent did not offer any additional testimony or exhibits at the formal hearing.

At the conclusion of the formal hearing, the parties advised the Hearing Officer that they were going to attempt to settle the case and requested that the Hearing Officer not establish a deadline for the filing of proposed recommended orders. On August 16, 1994, the Petitioner filed a motion in which it stated that the parties had not been able to reach a settlement agreement and

requested an opportunity to supplement the record with certain materials. By order dated October 10, 1994, the Hearing Officer established deadlines for the filing of any materials with which the parties sought to supplement the record and establishing deadlines for the filing of any objections to proposed supplemental materials.

On November 2, 1994, the Petitioner filed the transcript of a post-hearing deposition taken on August 12, 1994, along with two exhibits that were identified during the course of that deposition. 3/ The transcript of the June 21, 1994, formal hearing was filed on December 5, 1994. The Respondent did not file any proposed supplemental documents, nor did the Respondent file any objection to the supplemental materials submitted by the Petitioner.

On February 17, 1995, the Hearing Officer issued an order establishing March 10, 1995, as the deadline for the submission of proposed recommended orders. On March 10, 1995, the Petitioner filed a proposed recommended order containing proposed findings of fact and conclusions of law. As of the date of this Recommended Order, the Respondent has not filed a proposed recommended order or any other post-hearing document. All proposed findings of fact submitted by the Petitioner are specifically addressed in the appendix to this Recommended Order.

FINDINGS OF FACT

1. At various times during early 1993, the Respondent, Set-Tel Marketing, Incorporated (hereinafter "Set-Tel"), arranged through a marketing company in Florida by the name of MRG for certificates to be mailed to people in various other states. The certificates evidenced participation in a game promotion known as "Celebrate America." Set-Tel paid MRG an agreed amount for each certificate that was mailed with Set-Tel's name, address, and telephone number. The certificates arranged for through MRG were ultimately mailed by Celebrate America, a game promotion located in New York.

   
   

2. The subject certificates offered prizes to the certificate holder. The total value of the prizes was greater than $5,000.00. The subject certificates stated that the certificate holder was guaranteed one of the five listed prizes, which ranged in value from a brand new automobile to a 27-inch color television.

   
   

3. Set-Tel's name, address, and telephone number were displayed on the front of the certificates. No other telephone numbers appeared anywhere on the certificates. The fine print on the back of the certificates included the following information: "To enter the sweepstakes automatically and receive additional details on the sweepstakes prizes and the values offered, call the telephone number indicated on the reverse side."

   
   

4. Inasmuch as Set-Tel's telephone number was the only telephone number on the certificates, all telephone calls from certificate holders seeking to enter the sweepstakes and obtain prize information were made to Set-Tel. When certificate holders would call, Set-Tel would try to sell vacation packages to them. Certificate holders who were only interested in sweepstakes and prize information were told to contact Celebrate America directly.

   
   

5. The subject game promotion was not registered in Florida. Set-Tel did not have any liability insurance, bond, or trust account.

   CONCLUSIONS OF LAW

   
   

6. The statutory provisions regarding game promotions of the type described above are found at Section 849.094, Florida Statutes. Subsections (1) through (7) of Section 849.094 contain definitions and numerous requirements that must be complied with by all game promotion operators. Provisions for enforcement of those requirements are found in Subsections (8) and (9) of Section 849.094, which read as follows:

   
   

   (8)(a) The Department of State shall have the power to promulgate such rules and regu- lations respecting the operation of game promotions as it may deem advisable.

   (b) Whenever the Department of State or the Department of Legal Affairs has reason to

   believe that a game promotion is being operated in violation of this section, it may bring an action in the circuit court of any judicial circuit in which the game promotion is being operated in the name and on behalf of the people of the state against any operator thereof to enjoin the continued operation of such game promotion anywhere within the state.

   (9)(a) Any person, firm, or corporation, or association or agent or employee thereof, who engages in any acts or practices stated in this section to be unlawful, or who violates any of the rules and regulations made pursuant to this section, is guilty of a misdemeanor of the second degree, punishable as provided in s.

   775.082 or s. 775.083.

   (b) Any person, firm, corporation, association, agent, or employee who violates any provision of this section or any of the rules and regulations made pursuant to this section shall be liable for a civil penalty of not more than $1,000 for each such violation, which shall accrue to the state and may be recovered in a civil action brought

   by the Department of State or the Department of Legal Affairs.

   
   

7. Noticeably absent from Section 849.094, Florida Statutes, is any mention of any authority for the Department of State or the Department of Legal Affairs to issue orders imposing fines or penalties for violations of any of the requirements of Section 849.094, Florida Statutes. In the absence of such statutory authority, the Department of State lacks authority to initiate and prosecute an administrative proceeding for the purpose of imposing penalties for alleged violations of Section 849.094. Pursuant to the clear language of the subject statute, enforcement of Section 849.094 must be by criminal prosecution or by civil action, both of which must be pursued in the courts. 4/

RECOMMENDATION

Inasmuch as the Department of State lacks statutory authority to issue a final order imposing any penalty for violation of Section 849.094, Florida Statutes, it is RECOMMENDED that the Department of State issue a Final Order in this proceeding dismissing the Administrative Complaint in its entirety.

DONE AND ENTERED this 29th day of March 1995 in Tallahassee, Leon County, Florida.

MICHAEL M. 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 29th day of March 1995.

ENDNOTES

1/ The two witnesses were Joan Ignelzi, the owner of the Respondent corporation, and Richard T. Railton, an investigator for the Department of State.

2/ The rejected exhibit consisted of the deposition testimony of an out of state witness. It was rejected because of defects in the notice of taking the deposition. The exhibit which was received was a copy of one of the subject certificates. The copy available at the time of the hearing did not include the information printed on the back of the certificate. By agreement of the parties, the Petitioner was allowed to late-file a copy of the back of the certificate.

3/ The taking of the post-hearing deposition was not authorized by the Hearing Officer and the transcript of that deposition has not been relied upon in making any of the findings of fact in this Recommended Order. The two exhibits submitted with the post-hearing deposition transcript consist of the front and the back of one of the subject certificates. The late filing of those documents was authorized by the Hearing Officer.

4/ In this regard it is important to note that administrative agencies in Florida do not have any inherent powers. Gardinier, Inc. v. Florida Department of Pollution Control, 300 So.2d 75 (Fla. 1st DCA 1974), School Board of Marion County v. PERC, 330 So.2d 770 (Fla. 1st DCA 1976). It is also well settled that a legislative direction as to the manner in which a thing is to be done impliedly prohibits its being done in any other way. Murphy v. Barnes, 3 So.

433 (Fla. 1888); State v. Yeats, 77 So. 262 (Fla. 1917); and Alsop v. Pierce, 19 So.2d 799 (Fla. 1944).

APPENDIX

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

Findings submitted by Petitioner

Except as specifically noted immediately below, all proposed findings of fact submitted by the Petitioner have been accepted in substance.

Paragraph 4: The last line of this paragraph is rejected as not being supported by persuasive competent substantial evidence. (The only evidence on the subject point is contained in a deposition transcript which was not received in evidence.)

Paragraph 5: The facts proposed in this paragraph are rejected as irrelevant.

Paragraph 8: The facts proposed in this paragraph are rejected as not being supported by persuasive competent substantial evidence. (The only evidence on the subject point is contained in a deposition transcript which was not received in evidence.)

Findings submitted by Respondent (None were submitted.)

COPIES FURNISHED:

Henri C. Cawthon, Esquire Department of State, Division

of Licensing

The Capitol, MS Number 4 Tallahassee, Florida 32399-0250

Ms. Joan Ignelzi, Agent

Set-Tel Marketing, Incorporated 1951 Northwest 35th Avenue Coconut Creek, Florida 33066

Honorable Sandra B. Mortham Secretary of State

The Capitol

Tallahassee, Florida 32399-0250

Don Bell, General Counsel Department of State

The Capitol, PL-02

Tallahassee, Florida 32399-0250

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.

================================================================= AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA DEPARTMENT OF STATE

DEPARTMENT OF STATE, DIVISION OF LICENSING,

Petitioner,

vs. DOAH CASE NO: 94-1636

DOS CASE NO: C93-01690

SET-TEL MARKETING, INCORPORATED, JOAN IGNELZI, AGENT/OWNER,

Respondent.

/

FINAL ORDER

This cause came before the Department of State, Division of Licensing, for consideration and final agency action, A formal administrative hearing was conducted pursuant to Section 120.57(1), Florida Statutes, on June 21, 1994, before Michael M. Parrish, a duly assigned Hearing Officer of the Division of Administrative Hearing. A Recommended Order was submitted by the Hearing Officer on March 29, 1995, a copy of which is attached. Petitioner filed exceptions on April 18, 1995.

FINDINGS OF FACT

The Department of State hereby adopts and incorporates herein by reference the Findings of Fact in the Recommended Order.

CONCLUSIONS OF LAW

The Department of State hereby rejects Conclusions of Law Numbers 6 and 7 of the Recommended Order.

The Department of State hereby adopts and incorporates herein by reference Petitioner's exceptions to the Recommended Order, a copy of which is attached.

WHEREFORE, based upon the foregoing, it is ORDERED that Respondent shall pay an administrative fine of $500.00, by certified check or money order, payable to the Department of State, Division of Licensing within thirty (30) days of this order.

NOTICE OF RIGHTS

This Order constitutes final agency action. Any party who is adversely affected by this Order may seek judicial review under Section 120.68, Florida Statutes. Such proceedings are commenced by filing a Notice of Appeal, pursuant to Rule 9.110, Florida Rules of Appellate Procedure, with the Deputy Clerk of

the Division of Licensing, Department of State, The Capitol, Mail Station Number 4, Tallahassee, Florida 32399-0250; and by filing a copy of the Notice of Appeal, accompanied by the applicable filing fees, with the First District Court of Appeals, or with the District Court of Appeal in the appellate district where the party resides. The Notice of Appeal must be filed within thirty (30) days of the day this Order is filed with the Clerk of the Department.

DONE AND ORDERED at TALLAHASSEE, Florida this 13th day of June, 1995.

John M. Russi, Director Division of Licensing

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a copy of the foregoing Final Order has been sent by

U.S. Mail this 13th day of June, 1995 to Joan Ignelzi, Agent, Set-Tel Marketing, incorporated, 1951 Northwest 35th Avenue, Coconut Creek, Florida 33066.

Douglas D. Sunshine Assistant General Counsel Department of State Division of Licensing

The Capitol, M.S. Number 4 Tallahassee, Florida 32399-0250

Attachment STATE OF FLORIDA

DEPARTMENT OF STATE

DEPARTMENT OF STATE, DIVISION OF LICENSING,

Petitioner,

vs. DOAH CASE NO. 94-1636

CASE NO. C93-01690

SET-TEL MARKETING, INCORPORATED, JOAN INGELZI, AGENT/OWNER

Respondent.

/

PETITIONER'S EXCEPTIONS TO THE RECOMMENDED ORDER

Petitioner, Department of State, Division of Licensing, pursuant to Section 120.57(1)(b)9, Florida Statutes, and Rule 28-5.404, Florida Administrative Code, submits the following exceptions to the Hearing Officer's Recommended Order. The Petitioner takes exception to the Recommended Order Conclusions of Law 6 and 7 and in support the Petitioner states:

The Department of State, Division of Licensing excepts to those portions of the Hearing Officer's Conclusions of Law 6 and 7 which conclude that the Department of State lacks statutory authority to initiate and prosecute an administrative proceeding for the purpose of imposing penalties for violations of Section 849.094, Florida Statutes.

The Hearing Officer specifically cited only subsection (8) and (9) of Section 849.094 as the provisions relating to enforcement of that section. However, Section 849.094(4)(b), Florida Statutes must also be read in pari materia with subsections (8) and (9) to recognize administrative provisions for enforcement. Section 849.094(4)(b), which addresses when the Department of State may waive the requirement of a bond or trust account for a game promotion, states:

The Department may waive the provisions of this subsection for any operator who has conducted game promotions in this state for not less than 5 consecutive years and who has not had any civil, criminal, or administrative action, instituted against him by the State or an agency of the State for violation of THIS section within that 5-year period.

(Emphasis added)

That subsection clearly recognizes that the state or any agency of the state, which includes the Department of State, may initiate administrative action for any violation of Section 849.094, Florida Statutes. Subsection (4)(b) must be read to allow the Department of State to initiate administrative action, governed by the provisions of Chapter 120, in order to give meaning to that subsection.

Further, paragraph (8)(a) of s. 1, ch. 85-197, Laws of Florida, transferred to the Department of State from the Attorney General, via a Type 4, Section 20.06(4) transfer, the power to promulgate rules for Section 849.094, Florida Statutes. Section 20.06(4) provides that any program or activity transferred under that section shall have all of its statutory powers transferred. Section 20.05(1)(a) provides that the head of a Department shall have the power to execute the powers and duties vested in his Department. Section 20.05(5) further provides that a Department head "shall . . . subject to requirements of Chapter 120 (Administrative Procedure Act), have existing authority to promulgate rules pursuant and limited to the powers, duties, and functions transferred [to it] . . . " Thus, at the time that jurisdiction over Section

849.094 was transferred to the Department of State, it was specifically contemplated that Chapter 120 applied to Section 849.094.

A statute should be construed in its entirety and as a whole. It is a cardinal rule of statutory construction that the entire statute under consideration must be considered in determining legislative intent, and effect

must be given to every part of the provision under construction and every part of the statute as a whole; from a view of the whole law in pari materia, the reviewing court will determine legislative intent . . . Significance and effect must if possible be accorded to every word, phrase, sentence, and part of the statute. 49 Fla. Jur. 2d, Statutes, Sections 115, 175, 179.

Although subsections (8) and (9) set forth enforcement provisions, they are not the sole enforcement provisions available to the Department as the Hearing Officer concluded. Subsection (8)(b) is clearly an injunctive enforcement provision; i.e., the Department of State may bring an action in circuit court if there is reason to believe that a game promotion "is being operated" to "enjoin" the "continued operation" of the game promotion. That provision would not allow the Department of State to go to circuit court on a game promotion which has ended. Subsection (9)(a) provides that the state attorney may proceed criminally on any violations of Section 849.094. Subsection (9)(b) merely sets forth a civil fine of not more than $1,000 per violation which shall be payable to the State and which "may be recovered" in a "civil action" brought by the Department of State or the Department of Legal Affairs. When subsection (9)(b) is read in pari materia with subsection (4)(b)p it is clear that an administrative action may be initiated by the Department of State alleging violations of Section 849.094 on game promotions which have ended. If the fines are not paid in accordance with any resulting administrative final order, the Department of State may seek enforcement of those fines in circuit court as provided in Sections 120.69 and 849.094(9)(b), Florida Statutes.

WHEREFORE, the Petitioner respectfully requests that the Division Director incorporate these modifications to Conclusions of Law numbers 6 and 7 in the Final Order in accordance with these exceptions.

Respectfully submitted,

Michele Guy

Assistant General Counsel Department of State

Fla. Bar No. 460087

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a copy of the foregoing has been sent by U.S. Mail this 18th day of, April 1995, to to Joan Ignelzi, Agent, Set-Tel Marketing, Incorporated, 1951 Northwest 35th Avenue, Coconut Creek, Florida 33066.

Michele Guy

Assistant General Counsel Department of State Division of Licensing

The Capitol, MS Number 4 Tallahassee, Florida 32399-0250

(904) 488-3492

Docket for Case No: 94-001636

Orders for Case No: 94-001636