STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case No. 97-3723

)

EVE K. MAROTTE, )

)

Respondent. )

)

RECOMMENDED ORDER

Upon due notice, William R. Cave, Administrative Law Judge, Division of Administrative Hearings, held a formal hearing in this matter in Tampa, Florida on October 30, 1997, by videoconference from Tallahassee, Florida.

APPEARANCES

For Petitioner: Geoffrey T. Kirk, Esquire

Department of Business and Professional regulation

Division of Real Estate

400 West Robinson Street Suite North-308

Orlando, Florida 32801

For Respondent: Eve K. Marotte, pro se

2616 46th Terrace North

St. Petersburg, Florida 33714 STATEMENT OF THE ISSUE

Should Respondent's license as a real estate broker be revoked, suspended or otherwise disciplined?

PRELIMINARY STATEMENT

By an Administrative Complaint dated June 20, 1997, and filed with the Division of Administrative Hearings (Division) on August 21, 1997, the Department of Business and Professional Regulation, Division of Real Estate (Department) seeks to revoke, suspend, or otherwise discipline Respondent’s license as a real estate broker in the State of Florida. As ground therefor, it is alleged that Respondent: (a) is guilty of fraud, misrepresentation, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence or breach of trust in a business transaction in the State of Florida in violation of Section 475.25(1)(b), Florida Statutes; and (b) is guilty of failing to timely satisfy a civil judgment in violation of Section 475.25(1)(d), Florida Statutes. By an Election of Rights, the Respondent disputed the allegations in the Administrative Complaint, requested a formal hearing, and this proceeding ensued.

At the hearing, the Department withdrew Count Two of the Administrative Complaint and proceeded on Count One of the Administrative Complaint only. The Department presented the testimony of David A. Eaton. The Department’s Exhibits One, Two, and Three were received as evidence. Respondent testified on her own behalf but presented no other witness. Respondent’s Exhibits A(1), A(2), B, C, D, E, and F were received as evidence.

Respondent made a proffer of Exhibits A(1), A(2), E and F. After further review of those exhibits, they were accepted.

A transcript of this proceeding was filed with the Division on November 13, 1997. Petitioner timely filed its proposed findings of fact and conclusions of law. Respondent chose not to file any proposed findings of fact and conclusions of law.

FINDINGS OF FACT

Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made:

1. The Department is the agency charged with the responsibility of investigating and enforcing the provisions of Chapter 475, Florida Statutes.

2. At all times material to this proceeding, Respondent was a licensed real estate broker in the State of Florida, issued license number 0152815 in accordance with Chapter 475, Florida Statutes.

3. Robert L. Purlee and Doris A. Purlee (Purlees) conveyed certain real property located at Unit 1303-A, Jamestown Condominiums, within Pinellas County, Florida, to Ralph F. Marotte and Eve K. Marotte (Marottes), on June 18, 1993, for an agreed upon sum of $15,000, with installments due over a period of 120 months, at the rate of $181,99 per month, beginning July 15, 1993. Since there was no express language in the deed to express a contrary intent, the conveyance to the Marottes created an estate by the entirety which was not available to answer for the individual debts of either of the tenants.

4. The Marottes executed a mortgage and ad promissory note creating a lien against the property in favor of the Purlees, to secure the timely payment of the sum owed by the Marottes.

5. At the time the Marottes purchased the property in question from the Purlees, there were no other liens or encumbrances against the property.

6. At the time the deed was recorded, there was two personal judgments filed of record against Ralph F. Marotte, individually, but no personal judgments filed of record against Ralph F. Marotte and Eve K. Marotte, jointly or as husband and wife, or Eve K. Marotte, individually. Since no copies of these judgments, certified or otherwise, were introduced as evidence, and David Eaton appeared to be confused about these judgments, this finding is based on the testimony of Eve K. Marotte which I find credible.

7. On November 10, 1993, the Marottes authored and caused to be delivered to the Purlees a letter which provides in pertinent part:

   We are unable to financially own this unit, therefore, we wish to deed it back to you and your wife, and record it in the courthouse.

   
   

   Rather than go thru foreclosure proceedings and lawyer’s fees etc., thought the simplest best way for both of us is to just return the property back to you both, and have the tenant send her rent payment directly to you.

   
   

   We have prepared the deed - and after it is recorded - have the courthouse send it to you directly. (Emphasis Supplied)

   * * *

   
   

8. On December 8, 1993, the Marottes authored and caused to be delivered to the Purlees a letter which provides in pertinent part:

   Attached is a copy of the Quit Claim Deed - which is being recorded and will be mailed to you directly. (Emphasis Supplied)

   
   

   * * *

   
   

9. On January 6, 1994, the Marottes authored and caused to be delivered to the Purlees a letter which provides in pertinent part:

   We went to the courthouse to record the deed, and realized that we did not take the mortgage off, so we are enclosing a satisfaction of mortgage, so that we can turn the property back to you- and you will then own it free and clear as you did before.

   
   

   As soon as we received this paper from you, will turn over everything, to you, that is, keys, etc. (Inventory remains the same). (Emphasis Supplied)

   
   

   * * *

   From the notation on the quit claim deed it appears that the Marottes attempted to record the deed at the courthouse but changed their mind as indicated in the letter.

10. The Purlees executed the satisfaction of mortgage and posted it with the United States Postal Service for delivery to the Marottes. Subsequently, the Purlees discussed the matter with their attorney, David A. Eaton, who advised the Purlees to have the satisfaction of mortgage retrieved from the postal service. This was accomplished, and the Marottes did not receive

    the satisfaction of mortgage. Therefore, the Marottes did not record the quit claim deed transferring title back to the Purlees.

11. Based on the testimony of Eve K. Marotte which I find credible, Eve K. Marotte continued in her effort to deed the property back to the Purlees, and even discussed the possibility of satisfying the personal judgments against Ralph F. Marotte in the process. In fact, Respondent even arranged for the sale of the property but that did not prove fruitful either.

12. At the time the Marottes attempted to deed the property back to the Purlees, the Marottes did not advise the Purlees of the personal judgments against Ralph F. Marotte, individually.

13. Since the conveyance of the property to the Marottes created an estate by the entirety, the property would not have been subject to any judgments against Ralph F. Marotte, individually upon the Marottes deeding the property back to the Purlees.

14. There was no intent on the part of the Respondent to “saddle” the Purlees with Ralph F. Marotte’s personal judgments. Likewise, there was no intent on the part of Respondent to mislead or misrepresent the circumstances surrounding the attempt to “deed back” the property or to induce the Purlees to execute a satisfaction of mortgage so that the Marottes could record such satisfaction or mortgage without recording the quit claim deed and thereby have the property free and clear of the mortgage.

15. Although the Marottes did make some of the mortgage payments, they did not make all of the payments as contemplated by the mortgage and promissory note. Their failure to make mortgage payments was due to their financial condition and not that the Marottes were intentionally attempting to deprive the Purlees of the property without paying for the property.

16. The Marottes collected some rent from the property but apparently did not apply this money toward the mortgage payment. However, there was no evidence, other than the requirement of making the mortgage payments, that the Marottes were required to pay the rent over to the Purlees.

17. On or about November 6. 1995, the Purlees filed a complaint with the Circuit Court of the Sixth Judicial Circuit of the State of Florida, in and for Pinellas County, against the Marottes alleging, inter alia, that Respondent committed fraud and dishonest dealing in a real estate transaction.

18. On a Motion for Summary Judgment filed by the Purlees, the court entered a Final Judgment Against Licensed Real Estate Broker, Eve K. Marotte, for Monetary Damages Arising Out of Fraudulent Conduct in a Real Estate Brokerage Transaction on March 1, 1996.

19. Additionally, the court entered a Final Judgment Against Eve K. Marotte and Ralph F. Marotte for the total sum of

    $95, 454.95 which included $22, 284.54 in actual damages,

    
    

    $66,853.62 in trouble damages pursuant to Section 772.11, Florida

    Statutes, $5,250.00 in attorney’s fees, and $1,066.79 in taxable costs.

20. Because of this judgment and other financial and personal circumstances surrounding the Respondent’s life at that time, the Respondent filed for bankruptcy which eventually “wiped out” this judgment.

21. Subsequently, the Purlees filed a separate proceeding for foreclosure of the mortgage, and obtained title to the property by foreclosure sale on or about August 1997.

22. Between the time of the initiation of the foreclosure proceeding and gaining title to the property, the Purlees had a receiver appointed to receive the rent on the property. Although David Eaton testified that the Marottes failed to turn over rents during this period, there is insufficient evidence to show that the Marottes received any rent during this period or that the property was rented at all times during this period.

23. Clearly, after engaging an attorney and obtaining the large judgment, the Purlees were not interested in taking the property back without the judgment being satisfied. Likewise, it is equally clear that Respondent was not financially able to pay the judgment.

24. Respondent did not intentionally or otherwise misrepresent the facts in order to induce the Purlees to accept the deed back and release her from her obligation, or act in a fraudulent manner in order to convince the Purlees to release

    Respondent from her obligation, or act dishonestly in her dealings with the Purlees.

    CONCLUSIONS OF LAW

    
    

25. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding pursuant to Section 120.57(1), Florida Statutes.

26. Section 475.25(1)(b), Florida Statutes, provides for disciplinary action against a real estate licensee if the licensee:

    (b) Has been guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction in this state. . . .

    
    

27. Petitioner argues that established principles of res judicata and collateral estoppel bars Respondent from contesting those issues of fact which were previously litigated and determined in the Final Judgment Against Licensed Real Broker, Eve K. Marotte, for Monetary Damages Arising Out of Fraudulent Conduct in a Real Estate Brokerage Transaction. Petitioner’s argument is without merit. Trucking Employees of North Jersery Welfare Fund, Inc. vs. Romano, 450 So. 2d 843 (Fla. 1984). The underlying facts of this case do not support the findings of the court in the circuit court case that the Respondent was guilty of fraudulent conduct in a real estate brokerage transaction.

28. In a disciplinary proceeding, the burden is upon the

regulatory agency to establish facts upon which its allegations of misconduct are based. Balino vs. Department of Health and Rehabilitative Services, 348 So. 2d 349 (1st DCA Fla. 1977). The Department must prove the material allegations of the Administrative Complaint by clear and convincing evidence.

Department of Banking and Finance, Division of Securities and Investor Protection vs. Osborne Stern and Company, 670 So. 2d 932 (Fla. 1996); Ferris vs. Turlington, 510 So. 2d 292 (Fla. 1987).

The Department has failed to meet its burden in this regard.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Florida Real Estate Commission enter a final order dismissing both Count I and Count II of the Administrative Complaint.

DONE AND ENTERED this 19th day of December, 1997, in Tallahassee, Leon County, Florida.

WILLIAM R. CAVE

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6947

Filed with the Clerk of the Division of Administrative Hearings this 19th day of December, 1997.

COPIES FURNISHED:

Henry M. Solares Division Director Division of Real Estate

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

Lynda Goodgame General Counsel

Department of Business and Professional Regulation

Northwood Centre

1940 North Monroe Street Tallahassee, Florida 32399-0792

Geofrrey T. Kirk, Esquire Department of Business and

Professional Regulation Division of Real Estate

400 West Robinson Street Suite N-308

Orlando, Florida 32801

Eve K. Marotte, pro se 2616 46th Terrace North

St. Petersburg, Florida 33714

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: 97-003723

Orders for Case No: 97-003723