vs. ) CASE NO. 95-2559A
AS SURETY. )
Respondent. )
Upon due notice, William R. Cave, Hearing Officer, Division of Administrative Hearings held a formal hearing in this matter on September 12, 1995, in Arcadia, Florida.
For Respondent: James A. Crocker, Qualified Representative Fancy Farms 1305 West Martin Luther King, Jr. Boulevard Sales, Inc. Plant City, Florida 33564-9006
Has Respondent Fancy Farms Sales, Inc. (Fancy Farms) made proper accounting to Petitioner Lonnie Pearce in accordance with Section 604.22(1), Florida Statutes, for agriculture products delivered to Fancy Farms from October 28, 1994, through December 10, 1994, by Lonnie Pearce to be handled by Fancy Farms as agent for Lonnie Pearce on a net return basis as defined in Section 604.15(4), Florida Statutes?
By letter dated April 25, 1995, the Department of Agriculture and Consumer Services (Department) advised Fancy Farms and Respondent Gulf Insurance Company (Gulf) that Lonnie Pearce had filed a Complaint alleging that Fancy Farms owed Lonnie Pearce $5,979.90 for an agricultural product delivered to Fancy Farms between October 28, 1994 and December 10, 1994. Fancy Farms filed an answer to the Complaint denying any indebtedness and requested a hearing within the prescribed time. Gulf did not file an answer to the Complaint or request a
hearing. By letter dated May 18, 1995, the Department notified Lonnie Pearce that Fancy Farms had filed an answer to the Complaint and had requested a hearing. By letter dated May 18, 1995, the Department referred the matter to the Division of Administrative Hearings (Division) for the assignment of a hearing officer and the conduct of a hearing.
At the hearing, Lonnie Pearce testified in his own behalf but did not present any other witness. Fancy Farms presented the testimony of Salvatore Toscano. Petitioner's exhibits one through three were received as evidence. Fancy Farm's exhibit one and two were received as evidence, with exhibit two being filed late.
There was no transcript of this proceeding filed with the Division. The time for filing posthearing findings of fact and conclusions of law were extended due to the late filing of Respondent Fancy Farm's exhibit two.
However, the parties did not file posthearing proposed findings of fact and conclusions of law as allowed by Section 120.57(1)(b)(4), Florida Statutes, under the extended time frame.
Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made:
At all times pertinent to this proceeding, Lonnie Pearce was in the business of growing and selling "agricultural products" as that term is defined in Section 604.15(3), Florida Statutes, and was a "producer" as that term is defined in Section 604.15(5), Florida Statutes.
At all times pertinent to this proceeding, Fancy Farms was licensed as a "dealer in agricultural products" as that term is defined in Section 604.15(1), Florida Statutes, as evidenced by license number 8453 issued by the Department, supported by bond number 57 92 20 in the amount of $75,000, written by Gulf Insurance Company with an inception date of September 1, 1994, and an expiration date of August 31, 1995.
Beginning October 28, 1994, and continuing through December 10, 1994, Lonnie Pearce delivered certain quantities of an agricultural product (zucchini) to Fancy Farms. It is the accounting for these zucchini (zukes) that is in dispute. It was stipulated by the parties that Fancy Farms was acting as agent in the sale of the zukes delivered to Fancy Farms for the account of Lonnie Pearce on a net return basis.
There is no dispute as the quantity or size of the zukes delivered by Lonnie Pearce to Fancy Farms during the above period of time. Furthermore, there is no dispute as to the charges made by Fancy Farms for handling the zukes, including but not limited to the commission charged by Fancy Farms. The agreed upon commission was ten per cent (10 percent) of the price received by Fancy Farms from its customers. There is no evidence that Fancy Farms found any problem with the quality of the zukes delivered to Fancy Farms by Lonnie Pearce during the above period of time.
Upon delivering the zukes to Fancy Farms, Pearce was given a prenumbered receiving ticket showing Lonnie Pearce as Grower number 6 and containing the following additional information: (a) date and time of delivery;
(b) produce number, i.e., 37 indicating fancy zukes and 38 indicating medium zukes; (c) description of the produce, i.e., zukes, fancy; (d) a lot number
containing number of delivery ticket, grower number and produce number, i.e. 2074-6-37 and; (e) the number of units of zukes received by Fancy Farm.
The accounting for the zukes from the following delivery receipt ticket numbers is being contested in this proceeding: (a) 2074 dated October 28, 1994, lot nos. 2074-6-37 and 2074-6-38; (b) 2078 dated October 31, 1994, lot nos.
2078-6-37 and 2078-6-38; (c) 2086 dated November 3, 1994, lot nos. 2086-6-37 and
2086-6-38; (d) 2103 dated November 4, 1994, lot nos. 2103-6-37 and 2103-6-38;
(e) 2128 dated November 8, 1994, lot nos. 2128-6-37 and 2128-6-38; (f) 2144
dated November 10, 1994, lot nos. 2144-6-37 and 2144-6-38; (g) 2162 dated
November 12, 1994, lot nos. 2162-6-37 and 2162-6-38; (h) 2180 dated November 15,
1994, lot nos. 2180-6-37 and 2180-6-38; (i) 2241 dated November 29, 1994, lot
nos. 2241-6-37 and 2241-6-38; (j) 2253 dated December 1, 1994, lot nos. 2253-6-
37 and 2253-6-38; (k) 2266 dated December 3, 1994, lot nos. 2266-6-37 and 2266-
6-38; (l) 2290 dated December 7, 1994, lot nos. 2290-6-37 and 2290-6-38 and; (m)
2314 dated December 10, 1994, lot nos. 2314-6-37 and 2314-6-38.
Once Fancy Farms found a customer for the zukes, Fancy Farms prepared a prenumbered billing invoice. Additionally, a bill of lading and load sheet was prepared and attached to the invoice. The bill of lading and load sheet would have the same number as the invoice. Basically, the invoice and bill of lading contained the customer's name and address, produce number, description of produce, number of units ordered, number of units shipped and the price per unit. The load sheet contains the customer's name, produce number, description of produce, units ordered, units shipped and the lot number for the units that made up the shipment.
On numerous occasions Fancy Farms made adjustments to the selling price after the price had been quoted and accepted but before the invoice was prepared. Fancy Farms did not make any written notations in its records showing the adjustments to the price or the reasons for the adjustments to the price. Salvatore Toscano testified, and I find his testimony to be credible, that this usually occurred when there was a decrease in the market price after Fancy Farms made the original quote. Therefore, in order to keep the customer, Fancy Farms made an adjustment to the price. Pearce was never made aware of these price adjustments.
In accounting for the zukes delivered by Pearce, Fancy Farms prepared a Grower's Statement which included the delivery receipt number, the date of delivery, the lot number, grower number, produce number, description of the produce, quantity (number of units), price per unit and total due. Payment for the zukes was made to Lonnie Pearce from these statements by Fancy Farms. On occasions payment was for only one delivery receipt while at other times payment was for several delivery receipts for different dates.
Petitioner's exhibit 2 is the Florida Vegetable Report (Market Report), Volume XIV, Nos. 12, 13, 16, 17, 19, 21, 22, 23, 31, 33, 35, 37 and 40, dated October 28, 31, 1994, November 3, 4,8, 10, 14, 15, 29, 1994, and December 1, 5, 7, 12, 1994, respectively. The Market Report is a federal-state publication which reports the demand (moderate), market (steady), volume sold and prices paid for numerous vegetables, including zucchini, on a daily basis. The prices quoted for zucchini is for 1/2 and 5/9th bushel cartons and includes palletizing. The average cost for palletizing in the industry is 65 per carton. Fancy Farms receives and sells zukes in one-half (1/2) bushel cartons. Fancy Farms does not palletize the cartons for handling at its warehouse or for shipment.
From October 28, 1994, through November 8, 1994, Pearce delivered a combined total of 431 units of fancy and medium zukes which included all lot numbers listed on delivery receipt ticket numbers 2074, 2078, 2086, 2103 and 2128. Pearce was paid $1,715.70 by Fancy Farms for those zukes as evidenced by Pearce's Grower Statement dated November 17, 1994 (Petitioner's exhibit 1). Fancy Farms sold this combined total of 431 units of zukes for $1,901.36 as evidenced by invoice nos. 3755, 3777, 3806 and 3814. The commission earned on these sales is $190.14 (0.10 x 1901.36 = 190.14). The amount owed by Pearce after deducting the amount paid by Fancy Farms ($1,715.70) and the commission ($190.14) is: $1,901.36 - $1,715.70 - $190.14 = -$4.48.
The Market Report shows a much higher price being paid on the market for both fancy zukes (mostly $10.00 on 10/28/94 and mostly $8.00 on 10/31/94) and medium zukes (mostly $8.00 on 10/28/94) and mostly $6.00 on 10/31/94) than was allowed Pearce for zukes delivered on the same dates to Fancy Farms. However, the zukes delivered on October 28 & 31, 1994, were not sold by Fancy Farms until November 1, 1994. There is no Market Report for November 1, 1994, included in Petitioner's exhibit 2. The Market Reports for November 3, 4, 8 and 10, 1994, included in Petitioner's exhibit 2, show fancy zukes selling for $4.00
- $6.65 and medium zukes selling $2.25 - $4.65. The prices ($5.00 - $6.00 for fancy zukes and $3.50 to $4.14 for medium zukes) received by Fancy Farms for those zukes delivered to Fancy Farms by Pearce beginning October 28 through November 11, 1994, are in line with the Market Report. Therefore, the prices received by Fancy Farms have been used to calculate the amount due Pearce.
From November 10, 1994, through November 15, 1994, Pearce delivered a combined total of 645 units of fancy and medium zukes to Fancy Farms which included delivery receipt ticket numbers 2144, 2162 and 2180. Pearce was paid
$2,461.15 by Fancy Farms for those zukes as evidenced by the Grower Statement dated November 25, 1994 (Petitioner's exhibit 1). Fifty-three units of medium zukes on delivery receipt no. 2144 (lot no. 2144-6-38), 128 units of fancy zukes on delivery ticket 2162 (lot no. 2162-6-37), 30 units of medium zukes on delivery ticket no. 2180 (lot no. 2180-6-38) and 66 units of fancy zukes on delivery ticket no. 2180 (lot no. 2180-6-37) were not accounted for by invoice. Therefore, the price established in the Market Report of $5.00, $8.00, $6.00 and
$8.00, respectively were used to calculate the amount owed Pearce for those zukes. The total amount calculated as owed to Pearce for the zukes represented by delivery receipt ticket nos. 2144, 2162 and 2180 is $3,513.00. The net difference due Pearce after deducting the amount paid to Pearce and the commission is: $3,513.00 - $2,461.15 - $351.30 = $700.55
On November 29, 1994, Pearce delivered 79 units of fancy zukes and 48 units of medium zukes for a combined total of 127 units and was paid $5.00 per unit for the fancy zukes and $3.00 per unit for the medium zukes for a total of
$539.00. From invoice no. 3941 it appears that Fancy Farms made an adjustment for its customer in the price per unit for fancy zukes that was not reflected in the price per unit paid to Pearce. The price per unit of $5.00 for fancy zukes paid Pearce is more in line with the price established in the Market Report and is the price used to calculate the amount due Pearce. Invoice no. 3927 indicates that Fancy Farms was paid $3.00 per unit for medium zukes. Therefore, the amount due Pearce is:
$5.00 per unit x 79 units = $ 395.00
$3.00 per unit x 48 units = $ 144.00 Total $ 539.00
Less: |
|
Ten per cent commission | $ | 53.90 |
Amount received by Pearce | $ | 539.00 |
Balance Owed by Pearce | -$ | 53.90 |
From December 1, 1994, through December 7, 1994, Pearce delivered 181 units of fancy zukes represented by lot nos. 2253-6-37, 2266-6-37 and 2290-6-37 and 160 units of medium zukes represented by lot nos. 2253-6-38, 2266-6-38 and 2290-6-38 for a combined total units of 341 units and was paid $1,385.00 for those zukes by Fancy Farms as evidenced by Pearce's Grower Statement dated December 15, 1994. The price per unit paid by Fancy Farms to Pearce was $5.00 fancy zukes and $3.00 for medium zukes. Other than 73 units of fancy zukes represented by lot no. 2253-6-37 which were billed out by Fancy Farms at $4.25 per unit, there was no evidence of the price per unit received by Fancy Farms for the balance of the fancy zukes and the medium zukes. On December 1, 1994, the Market Report shows the price per unit for fancy and medium zukes to be mostly $8.65 and mostly $6.65 per unit, respectively. Pearce should received a price of $4.25 per unit for 73 units of fancy zukes; $8.65 per unit for 30 units of fancy zukes and $6.65 per unit for 33 units of medium zukes delivered on December 1, 1994. The per unit price of $6.00 and $3.50 for fancy and medium zukes respectively, received by Fancy Farms as indicated on invoice nos. 3946 and 4049 falls within the per unit price reported in the Market Report for the dates of December 5 & 7, 1994. Therefore, Pearce should receive:
$4.25 per unit x 73 units | = | $ 310.25 |
$8.65 per unit x 30 units | = | $ 259.50 |
$6.65 per unit x 33 units | = | $ 219.45 |
$6.00 per unit x 78 units | = | $ 468.00 |
$3.50 per unit x 127 units | = | $ 444.50 |
Total |
| $1,701.70 |
Less: Ten percent commission |
|
$ 170.17 |
Amount received by Pearce |
| $1,385.00 |
Amount owed Pearce |
| $ 146.53 |
On December 10, 1994, Pearce delivered 39 units of medium zukes and 32 units of fancy zukes to Fancy Farms and was paid $3.50 per unit for medium zukes and $5.50 per unit for fancy zukes for a total $312.50 by Fancy Farms. There is no invoice or other evidence to show what Fancy Farms received for the above 71 units of zukes. However, the Market Report reflects that fancy zukes were selling mostly for $7.00 to $8.00 per unit and medium zukes were selling mostly for $6.00 per unit. Therefore, Pearce should receive:
$7.50 per unit x 32 units | = | $ 240.00 |
$6.00 per unit x 39 units Total $ 474.00 | = | $ 234.00 |
Less: Ten percent commission |
$ 47.40 |
Amount received by Pearce | $ 312.50 |
Amount owed Pearce | $ 114.10 |
November 17, 1994 | -$ 4.48 |
November 25, 1994 | $ 700.55 |
December 7, 1994 | -$(-53.90) |
December 15, 1994 | $ 146.53 |
December 23, 1994 | $ 114.10 |
SubTotal
Less: Positive Adjustment/ | $ 906.80 |
The net amount owed to Pearce by Fancy Farms: From Grower Statements dated:
Grower Statement dated
December 25, 1994. $ 127.00
Balance owed Pearce $ 779.80
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, this proceeding pursuant to Sections 120.57(1) and 604.21(6), Florida Statutes.
Section 604.22(1), Florida Statutes, provides as follows:
Each licensee, while acting as agent for a producer, shall make and preserve for at least 1 year a record of each transaction, specifying the name and address of the producer for whom he acts as agent; the date of receipt; the kind, quality; and
quantity of agricultural products received; the name and address of the purchaser of each package of agricultural products; the price for which each package was sold; the amount and explanation of any adjustments given; and the net amount due from each purchaser. An account of sales shall be furnished each producer within 48 hours after the sale of such agricultural products. Such account of
sales shall clearly show the sale price of each lot of agricultural products sold; all adjust- ments to the original price, along with an explanation of such adjustments; and an itemized showing of all marketing costs deducted by the licensee along with the net amount due the producer. The licensee shall make payment to the producer within 5 days of the licensee's receipt of payment. (Emphasis supplied)
It is clear from the record that Respondent Fancy Farms Sales, Inc. failed to comply with the above in that it failed to record the amount of adjustments and explanations, give Pearce an account of the sales timely, itemize all marketing costs (commission), and record the name and address of the purchaser of all of Pearce's zucchini.
The burden of proof is on the party asserting the affirmative of an issue before an administrative tribunal. Florida Department of Transportation v.
Any party to these proceedings adversely affected by this Final Order is entitled to seek review of this Order pursuant to Section 120.68, Florida Statutes, and Rule 9. 110, Florida Rules of Appellate Procedure. Review proceedings must be instituted by filing a petition or notice of appeal with the Agency Clerk, 5th Floor, Mayo Building, Tallahassee, Florida 32399-0800, and a copy of same with the appropriate District Court of Appeal within thirty (30) days of rendition of this Order.
ANN H. WAINWRIGHT
Filed with Agency Clerk this 16th day of January, 1996.
Joann S. Dixon Agency Clerk
Mr. Lonnie Pearce, 1676 CR 731, Venus, Florida 33960
Mr. James A. Crocker, Qualified Representative, Fancy Farms Sales, Inc., 1305 W. Dr. M.L. King, Jr., Blvd., Plant City, Florida 33564-9006
Gulf Insurance Company, Legal Department, 4600 Fuller Drive, Irving, TX 75038- 6506
Mr. William R. Cave, Hearing Officer, Division of Administrative Hearings, The DeSoto Building, 1230 Apalachee Parkway, Tallahassee, Florida 32399-1550 Messrs.
