STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND ) PROFESSIONAL REGULATION, )

)

Petitioner, )

)

vs. ) CASE NO. 96-5849

) CHRISTOPHER T. C. SMITH, )

)

Respondent. )

)

RECOMMENDED ORDER

Robert E. Meale, Administrative Law Judge of the Division of Administrative Hearings, conducted the final hearing by videoconference in Tallahassee, Florida, on February 28, 1997.

The parties, attorneys for the parties, witnesses, and court reporter participated by videoconference in Ft. Myers, Florida.

APPEARANCES

For Petitioner: Attorney Andrea D. Perkins

Department of Business and Professional Regulation

Division of Real Estate Legal Section

400 West Robinson Street Suite N-308A

Orlando, Florida 32801

For Respondent: Frederick H. Wilsen

Frederick H. Wilsen & Associates, P.A.

Law Office of Gillis & Wilsen 1415 East Robinson Street Suite B

Orlando, Florida 32801

STATEMENT OF THE ISSUE

The issue is whether Respondent is guilty of obtaining his license by fraud, misrepresentation, or concealment, in violation of Section 475.25(1)(m), Florida Statutes.

PRELIMINARY STATEMENT

By Administrative Complaint dated November 19, 1997, Petitioner alleged that Respondent was a licensed real estate broker. The Administrative Complaint alleges that Petitioner sent Respondent a renewal notice as the end of his licensing term approached, and the notice states that the licensee “acknowledges compliance with all the requirements for renewal” by submitting the required fees.

The Administrative Complaint alleges that, on January 1, 1996, Respondent signed the renewal affirmation, stating that “I hereby affirm that I have met all statutory and rule requirements for renewal.” Petitioner then renewed his license for the term starting April 1, 1996.

The Administrative Complaint alleges that, when he submitted the license renewal affirmation and fee, Respondent had not completed the 14 hours of continuing education required for renewal by Section 475.182(1), Florida Statutes. The Administrative Complaint alleges that he completed the continuing education on July 1, 1996.

The Administrative Complaint alleges that Respondent thereby obtained his license by fraud, misrepresentation, or concealment,

in violation of Section 475.25(1)(m), Florida Statutes. The Administrative Complaint seeks the full range of penalties and costs under Section 455.227(3), Florida Statutes.

Respondent represented himself at the final hearing. Counsel for Respondent appeared when he filed a proposed recommended order.

At the hearing, Petitioner called one witness and offered into evidence two exhibits. Respondent called one witness and offered into evidence eight exhibits. All exhibits were admitted except Respondent Exhibit 5.

The court reporter filed the transcript on March 27, 1997. The parties filed their proposed recommended orders by April 11, 1997.

FINDINGS OF FACT

1. At all material times, Respondent has been a licensed real estate broker, holding license number 0500228.

2. Respondent’s licensing cycle ends on March 31 every two years. He duly renewed his broker’s license prior to its expiration on March 31, 1994.

3. During the ensuing two-year licensing term, Respondent executed on January 1, 1996, a Request for License or Change of Status and submitted the form to Petitioner. The purpose of submitting the form was to notify Petitioner that Respondent had adopted a corporate form of doing business as a real estate broker.

4. Section A of the form contains a series of options. Respondent selected “other” and wrote in “change to corp.” Section B contains identifying information, and Respondent completed this section. Section C is irrelevant to the change that Respondent was making, and he did not fill in this section.

5. The instructions for Section A direct the person filing the form as follows: “If this is a renewal of your license, it must be accompanied by the required fee and sign this: I hereby affirm that I have met all statutory and rule requirements regarding education for license renewal.” Respondent signed this statement even though he was not seeking a renewal of his license.

6. The instructions for Section B told the person filing the form how to complete Section B. But these instructions required no representations.

7. The next form generated in this case was another renewal notice, as Respondent’s license neared the end of its term, which expired March 31, 1996. This form states: “By submitting the appropriate renewal fees to the Department . . ., a licensee acknowledges compliance with all requirements for renewal.”

8. By check dated December 30, 1995, Respondent timely submitted his license renewal fee of $95 in response to the renewal notice. He was unaware at the time that he had not met the continuing education requirement for relicensing, which called for 14 hours of education.

9. In reliance on the implied representation that Respondent had completed the required continuing education, Petitioner renewed Respondent’s license. Later, during a random audit, Petitioner discovered that Respondent had not completed the necessary courses and commenced this proceeding.

10. Respondent was cooperative during the audit. Upon discovering that he had not complied with the continuing education requirement, he promptly undertook the necessary coursework, which he completed by August 6, 1996.

    CONCLUSIONS OF LAW

    
    

11. The Division of Administrative Hearings has jurisdiction over the subject matter. Section 120.57(1), Florida Statutes. (All references to Sections are to Florida Statutes.)

12. Section 475.25(1)(m) authorizes the Florida Real Estate Commission to impose discipline against a person who has “obtained a license by means of fraud, misrepresentation, or concealment.”

13. Section 475.182(1) requires that a broker or salesperson seeking renewal of his license satisfactorily complete 14 hours of continuing education during each two-year licensing period.

14. Petitioner must prove the material allegations by clear and convincing evidence. Department of Banking and Finance v. Osborne Stern and Company, Inc., 670 So. 2d 932 (Fla. 1996) and Ferris v. Turlington, 510 So. 2d 292 (Fla. 1987).

15. Section 475.182(1)(e) authorizes discipline for any violation of Chapter 475. Petitioner elected not to charge Respondent with this offense. Such a charge would have required evidence only that Respondent failed to satisfy his continuing education requirement, regardless of his state of mind. Instead, Petitioner charged Respondent with the more serious offense of obtaining his license by fraud, misrepresentation, or concealment.

16. Petitioner has not proved that Respondent obtained his license by fraud, misrepresentation, or concealment. His failure to satisfy the continuing education requirement appears most likely to have been the result of a mere oversight, which negates any finding of fraud, misrepresentation, or concealment.

17. Sensing that the proof established no intent by Respondent to conceal his failure to complete the continuing education, Petitioner argues in its proposed recommended order that negligent misrepresentation is a suitable basis for finding a violation of Section 475.25(1)(m). One must question why Petitioner would go to such lengths to extend the normal meaning of “fraud, misrepresentation, and concealment”--all of which normally connote an affirmative, intentional wrongdoing--to a negligent act or omission, especially when Section 475.25(1)(e) better describes the violation present in this case. In any event, this is a disciplinary case, and such an extension of the

    reach of Section 475.25(1)(m) seems ill-advised, at least on the facts of this case.

18. Petitioner cites several cases in its proposed recommended order to show that the Florida Real Estate Commission “has consistently disciplined licensees for misrepresentation of the fulfillment of the 14 hours continuing education requirement.” Petitioner has helpfully attached copies of these decisions to the proposed order.

19. In Department of Business and Professional Regulation v. Anita Ruth Green, DOAH Case No. 96-3998, the Florida Real Estate Commission entered a final order adopting the recommended order of the administrative law judge, who had recommended revocation for a violation of Section 475.25(1)(m) in fraudulently obtaining a renewal license through a misrepresentation of completion of the 14 hours of continuing education. The recommended order found that the licensee knew, when submitting her renewal form, that the law required 14 hours of continuing education for renewal and unconvincingly lied that she had completed the necessary coursework. This is fraud-- something missing from the present case.

20. In Department of Business and Professional Regulation v. Lillie Denise Wallace, FREC Case No. 96-82780, and Department of Business and Professional Regulation v. Paul H. Miesner, FREC Case No. 96-83361, the Florida Real Estate Commission entered final orders on admitted administrative complaints, charging

violations of Section 475.25(1)(m). The administrative complaints alleged no fraud, but the cases were not contested, so the facts were not developed. Uncontested cases do not establish sound precedent.

RECOMMENDATION

It is

RECOMMENDED that the Florida Real Estate Commission enter a final order dismissing the administrative complaint against Respondent.

ENTERED in Tallahassee, Florida, on June 4, 1997.

ROBERT E. MEALE

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 on June 4, 1997.

COPIES FURNISHED:

Attorney Andrea D. Perkins Department of Business and

Professional Regulation Division of Real Estate Legal Section

400 West Robinson Street Suite N-308A

Orlando, Florida 32801

Frederick H. Wilsen Frederick H. Wilsen &

Associates, P.A.

Law Office of Gillis & Wilsen 1415 East Robinson Street Suite B

Orlando, Florida 32801

Lynda L. Goodgame General Counsel

Department of Business and Professional Regulation

1940 North Monroe Street Tallahassee, Florida 32399-0792

Henry M. Solares Division Director Division of Real Estate

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900

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 must be filed with the agency that will issue the final order in this case.

Docket for Case No: 96-005849

Orders for Case No: 96-005849