STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CATHERINE KING, )

)

Petitioner, )

)

vs. ) Case No. 99-0266F

)

FLORIDA ELECTIONS COMMISSION, )

)

Respondent. )

)

FINAL ORDER

Pursuant to notice this cause came on for formal proceeding before P. Michael Ruff, duly-designated Administrative Law Judge on April 12, 1999, in DeFuniak Springs, Florida.

APPEARANCES

For Petitioner: J. David Holder, Esquire

Post Office Box 489 DeFuniak, Florida 32345

For Respondent: No appearance.

STATEMENT OF THE ISSUE

The issues to be resolved in this proceeding concern whether the Petitioner is entitled to recover attorney's fees and costs incurred as a result of prevailing in the underlying case of Florida Elections Commission vs. Catherine King, Case

No. 98-1256, Final Order entered December 11, 1998, based on the authority of Section 57.111, Florida Statutes.

PRELIMINARY STATEMENT

This proceeding began when the Respondent entered an Order of Probable Cause on November 7, 1997, concerning an election law violation. The Petitioner requested a formal hearing on the allegations, and on July 10, 1998, a formal hearing was held.

Subsequent to that hearing on October 8, 1998, a Recommended Order was entered finding that the Petitioner did not commit the election law violation that the Respondent had alleged in its Order of Probable Cause. On December 11, 1998, the Respondent agency entered a Final Order by which it adopted the Recommended Order in Case No. 98-1256, in its entirety.

On January 14, 1999, the Petitioner herein (the Respondent in the underlying case) initiated this proceeding by the filing of a Petition for Recovery of Attorney's Fees and Costs pursuant to Section 57.111, Florida Statutes. On February 3, 1999, the Respondent filed a Motion to Dismiss in opposition to the Petition. In response to this motion, the Petitioner filed a Motion for Leave to Amend her Petition which was granted by Order of March 17, 1999.

Thereafter, by notice of hearing issued March 24, 1999, the cause was set for hearing on April 12, 1999. The Petitioner testified at hearing and offered nine (9) exhibits which were received into evidence, as well as publishing excerpts of the former testimony of a number of witnesses given in the underlying case. The Respondent did not appear at the hearing.

A transcript of the hearing has been filed and the parties have timely submitted proposed orders which were considered in the rendition of this order. Subsequent to the hearing a Motion for Re-Hearing, alternatively requesting dismissal, was filed in conjunction with the Respondent agency's Proposed Order. In essence, the Respondent maintains that it was unaware that a date for hearing had been set until the Judge's assistant contacted the Respondent telephonically on the date of hearing, April 12, 1999, to inform the Respondent that the hearing time had been changed to later that day (3:00 p.m.) On the day of the hearing it appeared that the notice had been sent to the agency Respondent. Indeed, the record present in the case file indicated that the Notice of Hearing had been sent to the correct address of record for the Respondent. Consequently, the hearing was conducted on that date in DeFuniak Springs, Florida. The Petitioner presented its case, the Respondent failed to appear, either to present its case or to show cause for a postponement.

FINDINGS OF FACT

1. This proceeding commenced when the Respondent entered an Order of Probable Cause on November 7, 1997. The Petitioner herein requested a formal hearing on the allegations upon which the agency had found probable cause. The formal hearing was held in the above-referenced underlying case (98-1256) on July 10, 1998. A Recommended Order was thereafter entered finding that the Petitioner had not committed any of the election law

   violations that Respondent herein had alleged in its order of probable cause. Thereafter, on December 11, 1998, the Respondent entered a Final Order by which it adopted the Recommended Order in Case No. 98-1256, in its entirety. In that Final Order, the Respondent "accepted the Findings of Fact, Conclusions of Law and Recommendation" of the Administrative Law Judge.

2. The Petitioner, Catherine King, was the prevailing party (Respondent) in the underlying action which had been initiated by the Florida Elections Commission, the Respondent in this proceeding. Neither party has appealed the Respondent's Final Order in Ms. King's favor and indeed it is undisputed that she is a "prevailing party."

3. The Respondent was not merely a nominal party in that underlying case. There are no existing circumstances which would make an award of attorney's fees and costs unjust in this action and indeed the Respondent herein has agreed that that is the case.

4. The attorney's fees and costs which the Petitioner incurred in the underlying proceeding total $8,109.20. There is no dispute that they are reasonable. The Petitioner actually expended that amount for fees and costs. The attorney's fees incurred by the Petitioner in this proceeding through April 9, 1999, are in the amount of $1,440.00. Those fees are shown to be reasonable. The Petitioner has paid some of the fees but has not

   yet been billed for all of the fees incurred during the month of April, 1999.

5. The Petitioner was the sole proprietor of an unincorporated business located in Walton County, Florida, and she herself was domiciled in Walton County, Florida, at the time the underlying action was initiated by the Respondent agency.

   Her business is known as "Quick Retrieval." It is unincorporated and had less than twenty-five employees and a net worth of less than two million dollars including both the Petitioner's business and personal investments at the time the action was initiated by the Respondent. Indeed its only employee is the Petitioner.

6. It has not been established that the Petitioner is a "small business party" for purposes of Section 57.111(3)(d)1.a. and b., Florida Statutes, however. Although proof offered by the Petitioner at hearing established that she has a "small business" and, as found above, it meets the employee compliment and net worth threshold requirements in order to recover attorney's fees under the Florida Equal Access to Justice Act (Section 57.111, Florida Statutes), it has not been demonstrated that the Petitioner is a prevailing small business party.

7. Although the Petitioner demonstrated that she had an unincorporated business of which she is the sole proprietor, the Petitioner's proof does not establish that the action initiated by the agency, from which she seeks to recover fees and costs, was initiated against her as the proprietor of a small business.

   Rather, that action, the probable cause order issued by the Respondent, Florida Elections Commission, was against her in her personal capacity as an office holder or one seeking to hold office as Clerk of the Court in Walton County. The action was the agency's attempt to re-dress what it had alleged was an election law violation by the Petitioner personally. The action initiated by the agency in the underlying case had nothing to do with the Petitioner's capacity as the proprietor of a small business. For instance, no license of that business was in jeopardy by the Respondent agency's action and none of the facets of the operation of the Petitioner's business was in any way jeopardized or subjected to any potential fine, penalty or sanction by the action initiated by the agency in the underlying case. The Petitioner's business was not a party to nor in anyway related to the subject matter of the underlying proceeding pertaining hereto. The Petitioner offered no evidence to indicate that her participation in the underlying proceeding was as the sole proprietor of an unincorporated business party to the subject action. That is, it was not the activities of the business which were in question. Thus, that element necessary to recovery of an attorney's fee, pursuant to Section 57.111, Florida Statutes, has not been proven. 1/

   CONCLUSIONS OF LAW

   
   

8. The Division of Administrative Hearings has jurisdiction of the subject matter of and the parties to this proceeding pursuant to Sections 120.57(1), and 57.111, Florida Statutes.

9. It is undisputed that the attorney's fees and costs sought in this proceeding are reasonable. It is also undisputed that the Respondent agency was more than a nominal party in the underlying proceeding and there are no circumstances prevailing which would render an award of attorney's fees and cost unjust. The disputed issues concern the Petitioner's proprietary status as a "small business party" and the issue of whether or not the actions of the agency in the underlying case were "substantially justified." The determination concerning the Petitioner's status as a "small business party" is dispositive, therefore, the issue of "substantial justification" need not be reached and the opportunity of the agency to adduce evidence on the issue of "substantial justification" through a grant of the Motion for

   Re-Hearing, which would involve a determination that the agency's earlier failure to appear at the hearing of April 12, 1999 was justified, need not be addressed.

10. Section 57.111(3)(d)1.a and b., Florida Statutes, provides that the term "small business party" means:

    A sole proprietor of an unincorporated business, including a professional practice, whose principal office is in the state, who is domiciled in this state, and whose business or professional practice has, at the time the action is initiated by a state

    agency, not more than twenty-five full-time employees or a net worth of not more than two million dollars, including both personal and business investments; or

    
    

    A partnership or corporation, including a professional practice which has its principal office in this state and has at the time the action is initiated by a state agency not more than twenty-five full-time employees or a net worth of not more than two million dollars.

    
    

11. Section 57.111, Florida Statutes, does not authorize an award of attorney's fees and costs to anyone other than a corporation, partnership or the sole proprietor of an unincorporated business. See Florida Real Estate Commission vs. Shealy, 647 So. 2d 151 (Fla. 1st DCA 1994). The Petitioner established that she was a proprietor of a small, unincorporated business which otherwise met the "small business" thresholds as to net worth and number of employees. Whether or not that business was in existence when the investigation was first initiated, the Petitioner established that it was in existence on January 1, 1997, well before the entry of the probable cause order on November 7, 1997, which initiated the formal action underlying this attorney's fee and costs proceeding.

12. Regardless of when the business began, versus the time the underlying formal proceeding against the Petitioner was initiated, it is clear that the Petitioner did not participate in that underlying proceeding (where she was a Respondent) as a partnership, corporation or as sole proprietor of an unincorporated business. The action in the underlying case did

    not proceed against the Petitioner for any action or omission she took as the owner or operator of that business nor was any fine, penalty or other sanction capable of being imposed on that unincorporated business of the Petitioner, or against the Petitioner in her capacity as the business proprietor, had she not prevailed in that underlying proceeding. Rather, the Petitioner was prosecuted by the agency in that underlying proceeding personally, in her individual capacity as a candidate for public office alleged to have violated the Florida Election Laws therein at issue. That proceeding had nothing to do with any actions, omissions or operations of the Petitioner in her capacity as a proprietor of the unincorporated business.

13. In this proceeding, aside from establishing the existence of the unincorporated business as one which met the minimum size requirements for a Section 57.111, Florida Statutes, entity which can seek attorney's fees and costs, the Petitioner offered no evidence to show that that unincorporated business, nor the Petitioner as its proprietor, participated in the underlying proceeding as a "small business party." Rather she merely was prosecuted by the agency in that underlying proceeding in her individual capacity as a candidate for public office. The Petitioner's business was not a party to, nor in any way related to the subject matter of the proceeding in the underlying case nor is the Petitioner in her capacity as proprietor of that business operation. That being the circumstance, it cannot be

said that, although she was a prevailing party that she was a prevailing "small business party." See Howey vs. Criminal Justice Standards and Training Commission, DOAH Case

No. 90-8198F (1991); and J.O.E. vs. Department of Health and Rehabilitative Services, DOAH Case No. 89-2830F (1989).

Accordingly, in view of the above findings, conclusions and considerations, it must be determined that the Petitioner is not entitled to an award of attorney's fees and costs pursuant to Section 57.111, Florida Statutes.

ORDER

Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record and the pleadings and arguments of the parties it is, therefore,

ORDERED:

That the Petition filed by Catherine King, for the above found reasons, be DENIED.

DONE AND ORDERED this 3rd day of June, 1999, in Tallahassee, Leon County, Florida.

P. MICHAEL RUFF 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) 921-6847

Filed with the Clerk of the Division of Administrative Hearings this 3rd day of June, 1999.

ENDNOTE

1/ Because of the result reached with regard to the issue concerning whether the Petitioner participated in the underlying proceeding as a "small business party," the remaining issue of the commission's "substantial justification" in prosecuting the underlying action need not be reached. That is the only other issue arising under Section 57.111, Florida Statutes, which the commission contests. Since the finding and conclusion below concerning the Petitioner's failure to establish participation in the underlying proceeding as the proprietor of a "small business party" is dispositive in the Respondent's favor, the Motion for Re-Hearing need not be granted and evidence on behalf of the Respondent on the issue of "substantial justification" need not be adduced.

COPIES FURNISHED:

J. David Holder, Esquire Post Office Box 489

DeFuniak Springs, Florida 32345

Kristi Reid Bronson, Esquire Florida Elections Commission The Capitol, Room 2002

Tallahassee, Florida 32399-0250

Barbara Linthicum, Executive Director Florida Elections Commission

The Capitol, Room 2002 Tallahassee, Florida 32399-0250

NOTICE OF RIGHT TO APPEAL

A party who is adversely affected by this final order is entitled to judicial review pursuant to Section 120.68, Florida Statutes. Review proceedings are governed by the Florida Rules of Appellate Procedure. Such proceedings are commenced by filing one copy of the notice of appeal with the Agency Clerk of the Division of Administrative Hearings and a second copy, accompanied by filing fees prescribed by law, with the District Court of Appeal, First District, or with the District Court of Appeal in the Appellate District where the party resides. The notice of appeal must be filed within 30 days of rendition of the order to be reviewed.

Docket for Case No: 99-000266F

Orders for Case No: 99-000266F