STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on June 13, 1997, at Miami, Florida, before J. D. Parrish, a designated Administrative Law Judge of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: John O. Williams, Esquire

Boyd, Lindsey, Williams & Branch, P.A. 1407 Piedmont Drive, East

Tallahassee, Florida 32317

For Respondent: Miguel Diaz-Perna, pro se

14631 Southwest 148th Street Circle Miami, Florida 33196

STATEMENT OF THE ISSUES

Whether the Respondent, Miguel Diaz-Perna, committed the violations alleged in the administrative complaints and, if so, what penalty should be imposed.

PRELIMINARY STATEMENT

This matter began on November 2, 1995, when the Department of Business and Professional Regulation (Department) issued three administrative complaints against the Respondent, Miguel Diaz- Perna. The first complaint, assigned DOAH Case No. 96-4448, set forth ten counts which itemized violations of the construction industry laws pertaining to work performed by Respondent on a contract with a consumer named Gum Lee.

Similarly, the second administrative complaint, DOAH Case No. 96-4449, alleged ten counts against Respondent for work performed for Li Kim Ming and Wan Chang Lu. And the third administrative complaint, Case No. 96-4450, set forth eight violations related to a contract for work for Ethel Odwin. As to all claims, Respondent executed an election of rights which disputed the facts and requested a formal hearing. Subsequently, on September 25, 1996, the cases were forwarded to the Division of Administrative Hearings for formal proceedings.

At the hearing, the Department voluntarily dismissed the following counts of the administrative complaints: as to DOAH Case No. 96-4448, counts VIII and X; and as to Case No. 96-4449, counts VII and VIII. The Department presented testimony from Sarina Lu Li and Jose David Mitrani. Its Exhibits 1 through 15, 11A, and 16 have been admitted into evidence. The Respondent testified in his own behalf, and his Exhibits 1 through 13 were received in evidence.

A transcript of the proceeding was filed with the Division of Administrative Hearings on August 12, 1997. Both parties submitted proposed recommended orders which have been considered.

FINDINGS OF FACT

1. The Department is the state agency charged with the responsibility of regulating construction industry licensees.

2. At all times material to the allegations of these complaints, the Respondent was licensed as a certified general contractor, license number CGC026702. Respondent's license is held in his individual name.

3. The company known as M.D.P. General Contractor, Inc., is not registered by the Construction Industry Licensing Board as a contractor. M.D.P. General Contractor, Inc., has not been qualified to practice contracting in the State of Florida.

4. On November 18, 1992, an individual named Gum Lee contracted with Respondent who was doing business under the entity name M.D.P. General Contractor, Inc., for the roof of his hurricane-damaged home.

5. While the contract identified Respondent as the president of the corporate entity and represented it to be a certified state general contractor, the contract did not bear Respondent's individual license number.

6. Respondent's price for re-roofing the Gum Lee residence was $13,000.

7. Gum Lee paid Respondent the full $13,000.

8. Respondent began work at the Gum Lee resident in November 1992. Subsequently, in April 1993 Respondent, again doing business as M.D.P. Contractor, Inc., entered into a second agreement with Gum Lee to make an addition to the residence. This second contract also did not bear Respondent's license number.

9. The contract price for this addition was to be $20,000.

   
   

10. Subsequently, Respondent obtained a permit from the Metro-Dade Building Department for work at the Gum Lee residence.

11. In July, 1993, Respondent executed an affidavit that all materialmen and subcontractors had been paid for labor and materials supplied to the Gum Lee projects.

12. In fact, Respondent had failed to pay at least one company, Coma Cast Corporation, in the amount of $3,808.44.

13. Coma Cast Corporation placed a valid lien on the Gum Lee property.

14. Neither Respondent nor M.D.P. Contractor, Inc., satisfied the lien within 75 days. Moreover, as of the date of hearing, Respondent had not satisfied the lien.

15. Despite having paid Respondent for the work and materials at his home, in order to satisfy the lien, Gum Lee was required to remit an additional $6,026.01 to Coma Cast.

16. In November, 1992, Li Kam Ming and Wan Chang Lu contracted with Respondent, doing business as M.D.P. Contractor, Inc., for the roof of their home. This contract, like the

    proposal form used by Respondent in all instances in this cause, did not contain Respondent's license number.

17. The contract price for the work for this project was

    
    

    $11,600 for which Respondent was paid in full.

    
    

18. Respondent pulled a Metro-Dade Building Department permit for the Ming/Lu project on or about December 18, 1992.

19. Respondent's individual license as a general contractor does not entitle him to perform roofing contracting in Florida.

20. Respondent represented himself to Ming and Lu as a licensed roofing contractor.

21. In November 1993, Coma Cast Corporation placed a valid lien against the Ming/Lu home in the amount of $2,872.86. This amount was due for materials furnished to this project and which were unpaid by Respondent or M.D.P. Contractor, Inc.

22. Despite notice of the lien, Respondent failed to satisfy it within 75 days.

23. On August 30, 1994, the property owners satisfied the lien by remitting $4,900.

24. Following mediation in circuit court, Respondent was ordered to pay Ming and Lu the sum of $5,400 to resolve this matter, but he has failed or otherwise refused to do so.

25. In February, 1993, Respondent contracted with Ethel Odwin for repairs at her hurricane-damaged home in Miami. As in the other cases, Respondent entered into this agreement as M.D.P.

    Contractor, Inc. No license number was included in the proposal form.

26. A second project (and agreement for same) at the Odwin home was entered into by Respondent on October 11, 1993. This project required repairs to the swimming pool at the residence.

27. The total contract price for both projects at the Odwin home was $46,664, of which Mrs. Odwin paid Respondent $44,917.40.

28. Respondent pulled a Metro-Dade Building Department permit for work at the Odwin home, but did not obtain a permit for the swimming pool repair.

29. At no time material to the allegations of this case has Respondent been licensed or certified to perform swimming pool contracting in the State of Florida.

30. Respondent did not subcontract the swimming pool work to be performed at the Odwin residence.

31. Respondent did not complete all work at the Odwin home and, in fact, as a percentage of the work completed, received more funds than he was entitled to under the parties' agreement.

32. Mrs. Odwin was required to expend an additional $8,000 in order to complete the work at the home after Respondent abandoned the projects in February 1994.

33. Respondent's excuse that his gravely ill son distracted him during the time frames of these cases cannot explain why he has failed to attend to the financial responsibilities of his business subsequent to his son's death.

    CONCLUSIONS OF LAW

    
    

34. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

35. The Petitioner has the burden of proof to establish, by clear and convincing evidence, the allegations of these cases. It has met that burden.

36. Section 489.129(1), Florida Statutes, provides, in pertinent part:

    489.129 Disciplinary proceedings.–

    
    

    (1) The board may take any of the following actions against any certificateholder 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 for financial harm directly related to a violation of a provision of this part, 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, financially responsible officer, or business organization for which the contractor is a primary qualifying agent, a financially responsible officer, or a secondary qualifying agent responsible under s. 489.1195 is found guilty of any of the following acts:

    * * *

    1. Knowingly violating the applicable building codes or laws of the state or of any municipalities or counties thereof.

    2. Performing any act which assists a person or entity in engaging in the prohibited uncertified and unregistered practice of contracting, if the certificateholder or registrant knows or has reasonable grounds to know that the person or entity was uncertified and unregistered.

    * * *

    1. Acting in the capacity of a contractor under any certificate or registration issued hereunder except in the name of the certificateholder or registrant as set forth on the issued certificate or registration, or in accordance with the personnel of the certificateholder or registrant as set forth in the application for the certificate or registration, or as later changed as provided in this part.

    2. Committing mismanagement or misconduct in the practice of contracting that causes financial harm to a customer. Financial mismanagement or misconduct occurs when:

       1. Valid liens have been recorded against the property of a contractor's customer for supplies or services ordered by the contractor for the customer's job; the contractor has received funds from the customer to pay for the supplies or services; and the contractor has not had the liens removed from the property, by payment or by bond, within 75 days after the date of such liens;

       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;

    * * *

    1. 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.

    2. Signing a statement with respect to a project or contract falsely indicating that the work is bonded; falsely indicating that payment has been made for all subcontracted work, labor, and materials which results in a financial loss to the owner, purchaser, or

    contractor; or falsely indicating that workers' compensation and public liability insurance are provided.

    * * *

    (n) Committing incompetency or misconduct in the practice of contracting.

    
    

37. In this case, the Department has proved by clear and convincing evidence that the Respondent did business in an entity name other than his licensed individual name. It has established he contracted for work which was not encompassed within his license, failed to include his license number on contracts, and failed to subcontract work which he could not perform to an appropriately licensed contractor.

38. The Department has further established that Respondent was grossly irresponsible in the financial dealings of his contracting business and that same led to financial harm suffered by three consumers who did business with him.

39. Rule 61G4-17.001, Florida Administrative Code, sets forth the guidelines for penalties in this matter. Such guidelines have been considered in the recommendation noted below. The rule provides, in pertinent part:

61G4-17.001 Normal Penalty Ranges.

The following guidelines shall be used in disciplinary cases, absent aggravating or mitigating circumstances and subject to other provisions of this Chapter.

* * *

1. 489.129(1)(d): Violation of state or local building codes or laws. First violation, $500 to $1,250 fine; repeat violation, $1,250 to $5,000 fine and/or probation, suspension, or revocation.

2. 489.129(1)(e): Assisting unlicensed

person to evade provision of Chapter 489. First violation, $500 to $2,500 fine; repeat violation, $2,500 to $5,000 fine and/or probation, suspension, or revocation.

* * *

(7) 489.129(1)(g), 489.119: Failure to

qualify a firm, and/or acting under a name not on license. First violation, $100 fine; repeat violation $750 to $1,500 fine.

(8) 489.129(1)(h): Mismanagement or misconduct causing financial harm to the customer. First violation, $750 to $1,500 fine and/or probation; repeat violation,

$1,500 to $5,000 fine and/or probation, suspension, or revocation.

* * *

1. 489.129(1)(j): Failing in any material respect to comply with the provisions of Part I of Chapter 489.

2. 489.129(1)(k): Abandonment. First violation, $500 to $2,000 fine; repeat violation, revocation and $5,000 fine.

* * *

(14) Misconduct or incompetency in the practice of contracting as set forth in Section 489.129(1)(n), Florida Statutes, shall include, but is not limited to:

* * *

1. Failure to abide by the terms of a mediation agreement.

2. The following guidelines shall apply to cases involving misconduct or incompetency in the practice of contracting, absent aggravating or mitigating circumstances:

* * *

3. Any other form of misconduct or incompetency. First violation, $250 to $1,000 fine and/or probation; repeat violations

$1,000 to $5,000 fine and/or probation, suspension or revocation.

* * *

(21) For any violation occurring after October 1, 1988, the board may order the contractor to make restitution in the amount of financial loss suffered by the consumer. Such restitution may be ordered in addition to the penalties provided by these guidelines without demonstration of aggravating factors set forth in rule 61G4-17.002, and to the extent that such order does not contravene federal bankruptcy law.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Construction Industry Licensing Board enter a final order revoking Respondent's license, imposing an administrative fine in the amount of $15,000, and requiring financial restitution to the extent that same does not contravene federal bankruptcy law.

DONE AND ORDERED this 10th day of September, 1997, in Tallahassee, Leon County, Florida.

J. D. PARRISH Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(904) 488-9675 SUNCOM 278-9675

Fax Filing (904) 921-6847

Filed with the Clerk of the Division of Administrative Hearings this 10th day of September, 1997.

COPIES FURNISHED:

Rodney Hurst, Executive Director Construction Industry Licensing Board 7960 Arlington Expressway, Suite 300

Jacksonville, Florida 32211-7467

Lynda L. Goodgame, General Counsel Department of Business and

Professional Regulation 1940 North Monroe Street

Tallahassee, Florida 32399-0792

John O. Williams, Esquire Boyd, Lindsey, Williams

& Branch, P.A.

1407 Piedmont Drive, East Tallahassee, Florida 32317

Miguel Diaz-Perna

14631 Southwest 148th Street Circle Miami, Florida 33189

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of 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: 96-004448

Orders for Case No: 96-004448