vs. ) CASE NO. 94-3000
GARY S. SACHS, )
Respondent. )
Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, Claude B. Arrington, held a formal hearing in the above-styled case on August 23, 1994, in Miami, Florida.
For Petitioner: Gary L. Asbell, Esquire
Whether Respondent, a licensed general contractor, committed the offenses alleged in the administrative complaint and the penalties, if any, that should be imposed.
Respondent is a certified general contractor in the State of Florida (license number CG C050853) who served as the licensed qualifying agent for Reliable Remodelers at the times pertinent to this proceeding. Petitioner filed a three-count administrative complaint that contained certain factual allegations and, based on those allegations, charged Respondent with having violated certain laws regulating the practice of general contracting in the State of Florida. By Count I, Respondent was charged with committing mismanagement or misconduct in the practice of contracting that causes financial harm to a customer in violation of Section 489.129(1)(h)(2), Florida Statutes.
which the contractor is engaged or under contract as a contractor in violation of Section 489.129(1)(k), Florida Statutes. By Count III, Respondent was charged with committing fraud or deceit in the practice of contracting in violation of Chapter 489.129(1)(m), Florida Statutes. By its post-hearing submittal, the Petitioner dismissed Count III of the Administrative Complaint.
The Respondent challenged the allegations of the Administrative Complaint and this formal proceeding before the Division of Administrative Hearings followed.
At the formal hearing, Petitioner called three witnesses and introduced twelve exhibits, each of which was accepted into evidence. Respondent introduced one exhibit and testified on his own behalf.
At the formal hearing, Petitioner requested leave to file a post-hearing motion to supplement the record with an affidavit of certain costs incurred by Petitioner in prosecuting this matter. Petitioner asserts that the assessment of costs should be included as part of the penalty to be assessed against Respondent. A separate order has been entered which grants Petitioner's post- hearing motion and admits the post-hearing affidavit as Petitioner's Exhibit 13.
A transcript of the proceedings has been filed. At the request of the parties, the time for filing post-hearing submissions was set for more than ten days following the filing of the transcript. Consequently, the parties waived the requirement that a recommended order be rendered within thirty days after the transcript is filed. Rule 60Q-2.031, Florida Administrative Code. The findings of fact submitted on behalf of the Petitioner are adopted in material part by this Recommended Order. Respondent did not file a post-hearing submittal.
At all times pertinent to this proceeding, Respondent was a certified general contractor and the holder of license number CG C050853 issued by the Florida Construction Industry Licensing Board.
At all times pertinent to this proceeding, Respondent was the licensed qualifying agent for Reliable Remodelers, a division of Action Bay Marine Company, Inc., and as such qualifying agent was responsible for all its contracting activities.
On March 9, 1993, Joel Broder while representing himself to be vice president of Reliable Remodelers, executed a contract with Louise Rodney and Astrid Lamand wherein Reliable Remodelers agreed to perform certain roofing and carpet work at the residence of Yves and Louise Rodney at 35 N.W. 115 Street, Miami, Florida. The reason Astrid Lamand signed this contract was not established.
The work to be done on the Rodney residence was in repair of damages caused by Hurricane Andrew. The costs of these repairs were to be paid by insurance proceeds. The price for this work to be performed by Reliable Remodelers, including materials, was $10,650.00. According to the terms of the contract, $200 was due as a down payment on or about March 9, 1993, and the remainder was due on completion of the work.
Ms. Rodney gave Mr. Broder two checks as deposits toward the work to be done. The first was a check in the amount of $200.00 on March 9, 1993, the date
the contract was signed. Mr. Broder told Ms. Rodney on March 9, 1993, to call him when her insurance settlement came in so he could come back for an additional check and thereafter begin work. On April 11, 1993, Ms. Rodney advised Mr. Broder by telephone that she had received her insurance settlement. On April 12, 1993, Ms. Rodney paid to Mr. Broder the second check, which was in the amount of $3,000.00.
On April 13, 1993, Mr. Broder told the Rodneys that work would begin on the house in three days.
Ms. Rodney made both of these checks payable to Joel Broder personally because Mr. Broder instructed her to do so. Mr. Broder assured her that it was acceptable to make these two deposit checks to him personally because of his position as a vice-president of Reliable Remodelers. Mr. Broder indicated that the final check would be made payable to Reliable Remodelers.
Reliable Remodelers never began work on the subject contract.
No building permit was ever pulled for the project described in the subject contract.
A local building department building permit would have been required for beginning work on the roofing portion of the project described in the subject contract.
The Rodneys never received a refund of the $3,200.00 paid to Joel Broder.
Louise Rodney was justified in believing Mr. Broder was an authorized representative of Reliable Remodelers. Mr. Broder presented a business card and a contract with Reliable Remodelers' name and address and Respondent's general contractor's license number printed on the contract.
Mr. Broder was employed by Reliable Remodelers and had the authority to negotiate contracts on its behalf with the public.
Richard Levin, a corporate officer of Reliable Remodelers at the time of the Rodney contract, knew that Mr. Broder was representing Reliable Remodelers in a contract sales capacity at the time of the Rodney contract.
Between April 13, 1993, and the end of June 1993 Louise Rodney and her husband, Yves Rodney, repeatedly called Mr. Broder at Reliable Remodelers, but were never able to get Mr. Broder or Reliable Remodelers to start work.
When Mr. or Ms. Rodney called the number provided by Mr. Broder, he or she would sometimes get Mr. Broder, sometimes get an answering machine, and sometimes get a lady who answered the phone "Reliable Remodelers."
Mr. Broder repeatedly made excuses to the Rodneys about why the job did not begin.
Sometime around the end of June or early July, Ms. Rodney called Mr. Broder and demanded a return of her money.
Mr. Broder told Ms. Rodney that he could not refund the money until the end of July because he never wrote checks until the middle of the month. Mr. Broder did promise to return the money to Louise Rodney by the end of July 1993.
In July 1993, Ms. Rodney filed a complaint with the Metro Dade Building and Zoning Department against Reliable Remodelers and Joel Broder.
On July 23, 1993, Ms. Rodney filed a complaint with the Florida Department of Business and Professional Regulation against Joel Broder and Reliable Remodelers.
In late August or early September 1993, Mr. Broder contacted Ms. Rodney by telephone about the refund. This telephone contact was after a representative from the Florida Department of Business and Professional Regulation had contacted Mr. Broder about Ms. Rodney's complaint. In that telephone conversation Mr. Broder discussed the possibility of refunding to Ms. Rodney her deposit, but he insisted on keeping $200.00 of the $3,200.00.
On or about September 10, 1993, the Respondent executed and sent Louise Rodney a letter on Reliable Remodelers letterhead. A copy of the letter was sent to the Department of Professional Regulation. This letter provided, in part, as follows:
You have expressed a desire to be released from our contract dated March 9, 1993, for work in the amount of $10,650.00.
We want to make it clear that we have been pro- hibited from fulfilling the terms of our contract by unreasonable and impractical demands by you, the Homeowners, as to how the work should proceed, i.e., demanding that roof tiles be loaded on the roof before it is hot mopped. 1/
Although your request at this time is not in accordance with the cancellation terms of our contract, we feel it would be in the best interest of all parties to grant your request. We do however, require written notification of your intent to cancel. Notarized signatures on this document will suffice. Upon receipt of this
executed document we will initiate refund procedures. Your deposit of $3,200.00 will be returned to you within thirty (30) days. This allows us time to recoup binders issued for your job. Of course we have incurred some expenses in the set up for performing our contractual obligation. These,
in excess of $400.00, we will overlook.
Please endorse and have notarized the statement below and return this document to us promptly.
The letter of September 10, 1993, contained a release clause that Ms. Rodney and Mr. Astride were to sign and have notarized before any refund was to be forthcoming.
Sometime just after September 13, 1994, in the evening, three men came to the Rodney home with a copy of the letter signed by the Respondent on September 10, 1993.
One of these three men was Jules Lindsor, a corporate officer of Reliable Remodelers. Mr. Lindsor falsely identified himself to the Rodneys as being Gary S. Sachs. These three men were trying to procure the Rodneys' signature on a release from the subject contract.
The Rodneys refused to sign the release because there was no refund present and because they wanted to consult a lawyer before signing.
Sometime after September 13, 1993, the Rodneys executed a release and mailed it to Reliable Remodelers.
At the time of entering the contract with Reliable Remodelers the Rodney home was leaking from damage caused by Hurricane Andrew.
The leaks were finally repaired between April and June 1994 by persons other than Reliable Remodelers.
Respondent and Reliable Remodelers ratified the contract that Mr. Broder executed on its behalf. There was no evidence that Respondent or Reliable Remodelers ever repudiated the contract as a Reliable Remodelers contract, that there was any effort to perform the contract, or that there was a tender of a refund of the $3,200.00 paid by Louise Rodney.
There was no evidence that Reliable Remodelers had any justifiable excuse for its failure to perform any work pursuant to its contract with Ms. Rodney and Mr. Astride.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction of the parties to and the subject matter of, this proceeding pursuant to Section 120.57(1), Florida Statutes.
Petitioner has the burden of proving by clear and convincing evidence the allegations against Respondent. See Ferris v. Turlington, 510 So. 2d 292 (Fla. 1987); Evans Packing Co. v. Department of Agriculture and Consumer Services, 550 So.2d 112 (Fla. 1st DCA 1989). Evans Packing, supra, 550 So. 2d 112, 116, fn. 5, provides the following pertinent to the clear and convincing evidence standard:
That standard has been described as follows: [C]lear and convincing evidence requires that the evidence must be found to be credible; the facts to which the witnesses testify must be distinctly remembered; the evidence must be precise and explicit and the witnesses must
be lacking in confusion as to the facts in issue. The evidence must be of such weight that it produces in the mind of the trier of fact the firm belief of (sic) conviction, with-
out hesitancy, as to the truth of the allegations sought to be established. Slomowitz v. Walker, 429 So.2d 797, 800 (Fla. 4th DCA 1983).
Section 489.129(1), Florida Statutes, authorizes the Petitioner to discipline general contractors in the State of Florida and provides, in pertinent part, as follows:
The board may take any of the following actions against any certificate holder or registrant: place on probation or reprimand the licensee, revoke, suspend, or deny the issuance or renewal of the certificate or registration, require financial restitution to a consumer, impose an administrative fine not to exceed $5,000 per violation, require
continuing education, or assess costs associated with investigation and prosecution, if the contractor . . ., or business organization for which the contractor is a primary qualifying agent . . . is found guilty of any of the following acts:
* * *
(h) Committing mismanagement or misconduct in the practice of contracting that causes financial harm to a customer. Financial mismanagement or misconduct occurs when:
* * *
2. The contractor has abandoned a customer's job and the percentage of completion is less than the percentage of the total contract price
paid to the contractor as of the time of abandonment, unless the contractor is entitled to retain such funds under the terms of the contract or refunds
the excess funds within 30 days after the date the job is abandoned . . .
* * *
(k) Abandoning a construction project in which the contractor is engaged or under contract as
a contractor. A project may be presumed abandoned after 90 days if the contractor terminates the project without just cause or without proper notification to the owner, including the reason for termination, or fails to perform work without just cause for 90 consecutive days.
* * *
For purposes of this subsection, construction is considered to be commenced when the contract
is executed and the contractor has accepted funds from the customer or lender.
Section 489.105(4), Florida Statutes, defines the term "primary qualifying agent" as follows:
(4) "Primary qualifying agent" means a person who possesses the requisite skill, knowledge, and experience, and has the responsibility, to supervise, direct, manage, and control the
contracting activities of the business organization with which he is connected; who has the responsibility
to supervise, direct, manage, and control construction activities on a job for which he has obtained the building permit; and whose technical and personal qualifications have been determined by investigation and examination as provided in this part, as attested by the department.
As the qualifying agent for Reliable Remodelers, Respondent is responsible for all construction and contracting activities of Reliable Remodelers, including the Rodney contract.
Petitioner established by clear and convincing evidence that Reliable Remodelers violated the provisions of Section 489.129(1)(h)(2), Florida Statutes, which prohibit mismanagement or misconduct in the practice of contracting that causes financial harm to a customer as alleged in Count I of the Administrative Complaint. This violation was established by the evidence that Reliable Remodelers took two checks in the total amount of $3,200.00 from Ms. Rodney and has failed to refund that sum to her despite demands to do so. Petitioner established that Respondent is responsible for that violation as the qualifying agent for Reliable Remodelers.
Petitioner also established by clear and convincing evidence that Reliable Remodelers abandoned the Rodney contract by failing to perform any work on the job in violation of Section 489.129(1)(k), Florida Statutes, as alleged in Count II of the Administrative Complaint. Petitioner established that Respondent is responsible for that violation as the qualifying agent for Reliable Remodelers.
Rule 61G4-17.001, Florida Administrative Code, provides, in part, the following guidelines that are pertinent to this proceeding:
The Following guidelines should be used in disciplinary cases, absent aggravating or mitigating circumstances and subject to the other provisions of this chapter;
* * *
(8) 489.129(1)(h), Florida Statutes, by committing mismanagement or misconduct causing financial harm to the customer. First violation,
$750.00 to $1,500.00 fine and/or probation; repeat violation, $1,500.00 to $5,000.00 fine and/or probation, suspension or revocation.
* * *
(11) 489.129(1)(k), Florida statutes, by committing abandonment. First violation,
$500.00 to $2,000.00 fine; repeat violation, revocation and $5,000.00 fine.
Rule 61G4-17.002, Florida Administrative Code, provides in part:
Circumstances which may be considered for the purposes of mitigation or aggravation of penalty shall include, but are not limited to, the following:
Monetary or other damage to the licensee's customer, in any way associated with the violations, which damage the licensee has not relieved, as of
the time the penalty is to be assessed. (This provision shall not be given effect to the extent it would contravene federal bankruptcy law).
Actual job-site violations of building codes, or conditions exhibiting gross negligence, incompetence, or misconduct by the licensee,
which have not been corrected as of the time the penalty is being assessed.
* * *
(8) The actual damage, physical or otherwise, to the licensee's customer.
* * *
Any efforts at rehabilitation.
Any other mitigating or aggravating circumstances.
In its post-hearing submittal, Petitioner argues that an appropriate penalty to be assessed against Respondent would be an administrative fine in the amount of $3,500.00, a requirement of restitution, and an assessment of costs. The penalty Petitioner is seeking is within its guidelines.
Section 489.129(1), Florida Statutes and Section 61G4-17.001(19), Florida Administrative Code, authorizes the Petitioner to assess costs of investigation and prosecution against the Respondent. The sum of $2,747.13 is the amount of costs reflected by Petitioner's post-hearing affidavit. That affidavit is hearsay evidence which cannot be used as the sole basis for the finding of a fact in this proceeding. See, Section 120.58(1)(a), Florida Statutes, and Rule 60Q-2.6026(3), Florida Administrative Code.
Section 489.129(1), Florida Statutes, and Section 61G4-17.001(20), Florida Administrative Code, authorizes the Petitioner to order the Respondent to pay $3,200.00 in restitution to Louise Rodney.
Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Respondent be ordered to pay a fine in the amount of
to Louise Rodney in the amount of $3,200, and pay costs incurred in the prosecution of this proceeding in the amount to be determined by the Petitioner.
DONE AND ORDERED in Tallahassee, Leon County, Florida, this 14th day of November 1994.
CLAUDE B. ARRINGTON
Filed with the Clerk of the Division of Administrative Hearings this 14th day of November 1994.
1/ There was no evidence that this statement was truthful. Respondent did not attempt to establish at the formal hearing that the homeowners prevented Reliable Remodelers from performing the work.
Gary L. Asbell, Esquire Senior Attorney
Richard Hickok, Executive Director Construction Industry Licensing Board 7960 Arlington Expressway, Suite 300
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
