STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF STATE, )

DIVISION OF LICENSING, )

)

Petitioner, )

)

vs. ) Case Nos. 99-2759

) 99-3022

COLLATERAL SERVICES OF AMERICA, ) INC., and WILLIAM NEGRON, )

)

Respondents. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on October 12 and December 21, 1999, in Miami, Florida, before Claude B. Arrington, a duly-designated Administrative Law Judge of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Douglas D. Sunshine, Esquire

Department of State Division of Licensing

The Capitol, Mail Station 4 Tallahassee, Florida 32399-0250

For Respondents: Roderick F. Coleman, Esquire

122 Minorca Avenue

Coral Gables, Florida 33134 STATEMENT OF THE ISSUE

Whether Respondents committed the offenses alleged in the Administrative Complaints.

PRELIMINARY STATEMENT

Respondent William Negron is the owner of Respondent Collateral Services of America, Inc. (CSA), a corporation that provides repossession services. Mr. Negron holds a Class "E" Recovery Agent License and a Class "C" Private Investigators License. CSA holds a Class "R" Recovery Agency License.

Petitioner filed two Administrative Complaints against Respondent Negron and his company. The Administrative Complaint that provides the basis for DOAH Case No. 99-2759 contains three counts. Count I alleges that Respondents charged for expenses not actually incurred in connection with the unloading of vehicles from a recovered auto carrier in violation of Section 493.6118(1)(u)2, Florida Statutes. Count II alleges that Respondent Negron failed to record the correct mileage in his records of a recovered vehicle in violation of Section 493.6118(1)(f), Florida Statutes. Count III alleges that Respondents reported a recovery to the police under an incorrect name in violation of Section 493.6118(1)(f), Florida Statutes.

The Administrative Complaint that provides the basis for DOAH Case No. 99-3022 contains four counts. Count I alleges that Respondent Negron failed to certify a biannual report of an internship for Adrian Lopez in violation of Section 493.6118(1)(r), Florida Statutes. Count II alleges that Respondent Negron failed to certify the completion or the

termination of an internship for Mr. Lopez in violation of Section 493.6118(1)(r), Florida Statutes. Count III alleges that Respondents failed to accurately credit Mr. Lopez with the proper number of hours he performed regulated activities in violation of Section 493.6118(1)(f), Florida Statutes. Count IV alleges that Respondent Negron attempted to coerce Mr. Lopez into withdrawing the complaint Mr. Lopez filed with against Respondents in violation of Section 493.6118(1)(f), Florida Statutes.

At the formal hearing, Petitioner presented the testimony of Perry Wood (an investigator employed by Petitioner) and Mr. Lopez. Petitioner presented three exhibits, each of which was admitted into evidence.

Respondent testified on his own behalf and presented the additional testimony of Jose Castellanos. Respondent offered no exhibits.

A Transcript of the proceedings has been filed. The Petitioner and Respondent Negron filed Proposed Recommended Orders, which have been duly-considered by the undersigned in the preparation of this Recommended Order.

FINDINGS OF FACT

1. Respondent William Negron holds a Class "E" Recovery Agent License (number E91-00022) and a Class "C" Private Investigator License (number C93-00478).

2. Respondent Collateral Services of America, Inc. (CSA) holds a Class "R" Recovery Agency License (Number R91-00085).

3. On October 2, 1998, Respondents repossessed an auto carrier from a debtor pursuant to a subcontract from MDL & Associates, which is a recovery agency owned by Mark and Debbie Lasik. This auto carrier was loaded with motor vehicles.

4. Respondents regularly employ Jose Castellanos to perform services on a piecework basis. Mr. Castellanos and one of his associates were hired by Respondents to unload the motor vehicles that were on the auto carrier. Respondents paid

   Mr. Castellanos and his associate the sum of $200.00 to unload the autos from the auto carrier. There was no evidence that this sum was unreasonable.

5. Respondent Negron timely reported the repossession of the auto carrier to the Miami Springs Police Department, the police department with jurisdiction of the area in which the repossession occurred. Mr. Negron testified, credibly, that he told the police officer to whom he made the report who he was and that he had repossessed the auto carrier pursuant to a subcontract with Mark Lasik, a principal of MDL & Associates. The police report reflected that the recovery was made by MDL & Associates and that the contact person at MDL & Associates was Mark Lasik. The police officer who took the report from Respondent did not testify at the formal hearing.

6. On or about January 23, 1998, Respondent Negron repossessed a 1997 BMW automobile. Respondent Negron, in completing a condition report 1/ for the BMW, reported that the mileage was 13,000 miles. The BMW had a digital readout, so that the mileage could not be read without the car being turned on. Respondent Negron testified that his company had the key and that one of his employees read the mileage and reported the same on the condition report. 2/

7. The BMW was stolen from Respondents' storage facility and subsequently recovered by law enforcement. Gold Coast Towing towed the stolen BMW for law enforcement and completed a report reflecting that the mileage was 12,499. There was no evidence as to whether Gold Coast Towing estimated the mileage or whether it had a key to the car and actually read the mileage.

8. Adrian Lopez was employed as a Recovery Agent Intern on or about January 13, 1998. Respondent Negron was Mr. Lopez's sponsor as a Recovery Agent Intern.

9. On January 11, 1999, Mr. Lopez filed a complaint with Mr. Wood against Respondents because he had been unable to get credit from Petitioner for the time he had worked for Respondents as an intern.

10. Petitioner admitted into evidence the licensure file of Mr. Lopez. This file contains an Intern Biannual Progress

    Report for the period January 23, 1998 to July 23, 1998. This form was signed and notarized on July 24, 1998, by Mr. Negron as sponsor for Mr. Lopez. The form was not time-stamped when received by Petitioner. The copy of the form submitted into evidence by Petitioner contains a fax footprint reflecting that the copy was faxed by CSA on January 13, 1999. Whether it was faxed directly to Mr. Wood was not established. There is no allegation that this report was not timely. Also on January 13, 1999, Respondents faxed to Petitioner a form reflecting that

    Mr. Lopez's employment had been terminated. This termination notice was dated January 11, 1999. There was no allegation that this notice was not timely.

11. Respondents did not submit a biannual report for the internship of Mr. Lopez for the period July 24, 1998 through January 13, 1999. Because that report was not filed, Mr. Lopez had difficulty establishing the amount of internship credit to which he was entitled. Mr. Wood, after reviewing Respondents' records, determined that Mr. Lopez was entitled to seven months of credit.

12. Mr. Lopez receives disability income benefits from the Department of Labor. After Mr. Lopez filed his complaint,

    Mr. Negron telephoned him and threatened to report to the Department of Labor that Mr. Lopez received much more money than he actually was paid. This was an attempt to coerce Mr. Lopez

    into withdrawing the complaint since such a report would jeopardize Mr. Lopez's disability benefits.

13. There was no evidence that Mr. Negron made any type of report with the Department of Labor.

    CONCLUSIONS OF LAW

    
    

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

15. Petitioner has the burden of proving the allegations against Respondents by clear and convincing evidence. Department of Banking and Finance v. Osbourne Stern, 670 So. 2d 932 (Fla. 1996); Ferris v. Turlington, 510 So. 2d 292 (Fla.

    1987).

    
    

16. Chapter 493, Florida Statutes, regulates the practice of private investigative, private security, and repossession services. Section 493.6118, Florida Statutes, provides, in pertinent part, the following:

    1. The following constitute grounds for which disciplinary action specified in subsection (2) may be taken by the department against any licensee, agency, or applicant regulated by this chapter, or any unlicensed person engaged in activities regulated under this chapter.

       * * *

       (f) Proof that the applicant or licensee is guilty of fraud or deceit, or of negligence, incompetency, or misconduct, in the practice of the activities regulated under this chapter.

       * * *

       (r) Failure or refusal by a sponsor to certify a biannual written report on an intern or to certify completion or termination of an internship to the department within 15 working days.

       * * *

       (u) In addition to the grounds for disciplinary action prescribed in paragraphs (a)-(t), Class "R" recovery agencies, Class "E" recovery agents, and Class "EE" recovery agent interns are prohibited from committing the following acts:

       * * *

       2. Charging for expenses not actually incurred in connection with the recovery, transportation, storage, or disposal of a motor vehicle, mobile home, motorboat, or personal property.

       * * *

    2. When the department finds any violation of subsection (1), it may do one or more of the following:

       1. Deny an application for the issuance or renewal of a license.

       2. Issue a reprimand.

       3. Impose an administrative fine not to exceed $1,000 for every count or separate offense.

       4. Place the licensee on probation for a period of time and subject to such conditions as the department may specify.

       5. Suspend or revoke a license.

          
          

17. Petitioner failed to prove the factual allegations in any of the three counts contained in DOAH Case No. 99-2759. Count I alleges that Respondents charged for expenses not actually incurred in connection with the unloading of vehicles from a recovered auto carrier in violation of Section 493.6118(1)(u)2, Florida Statutes. The evidence established that the expenses at issue were incurred and there was no

    evidence that the expenses were unreasonable. Count II alleges that Respondents failed to record the correct mileage in his records of a recovered vehicle in violation of Section 493.6118(1)(f), Florida Statutes. The evidence established that there was a discrepancy in the mileage between an unofficial report prepared by Respondents and one subsequently prepared by another recovery agency. This discrepancy does not establish that Respondents' report was incorrect. Consequently, that discrepancy does not establish the violation alleged in Count II by clear and convincing evidence. Count III alleges that Respondents reported a recovery to the police under an incorrect name in violation of Section 493.6118(1)(f), Florida Statutes.

    Mr. Negron's credible testimony established that he correctly reported the repossession at issue to the Miami Springs Police Department. Respondents are not responsible for the manner in which the police officer prepared his or her report.

18. DOAH Case No. 99-3022 contains four counts.

    
    

    Petitioner established by clear and convincing evidence that Respondents failed to certify a biannual report of an internship for Adrian Lopez for the period July 24, 1998 through January 13, 1999, in violation of Section 493.6118(1)(r), Florida Statutes, as alleged in Count I.

19. Petitioner failed to establish by clear and convincing evidence that Respondents failed to certify the completion or

    the termination of an internship for Mr. Lopez in violation of Section 493.6118(1)(r), Florida Statutes, as alleged in Count

    II. Respondents filed a notice that the employment of Mr. Lopez had been terminated. It was not established that this notice was inadequate to notify Petitioner that the internship had been terminated.

20. Count III charged Respondents with failing to accurately credit Mr. Lopez with the proper number of hours he performed regulated activities in violation of Section 493.6118(1)(f), Florida Statutes. Intern sponsors, such as

    Mr. Negron, do not award internship credits to interns, but they are required to submit reports that would enable Petitioner to award such credit. The Intern Biannual Progress Report for the period July 24, 1998 through January 13, 1999, would have contained the information necessary for that credit to be determined. It is concluded that the allegations contained in Count III are subsumed in the violation based on the allegations of Count I.

21. The evidence pertaining to the threatening telephone call Mr. Negron made to Mr. Lopez established by clear and convincing evidence that Mr. Negron was guilty of misconduct in violation of Section 493.6118(1)(f), Florida Statutes, as alleged in Count IV.

22. Rule 1C-3.113(2)(t), Florida Administrative Code, provides a penalty guideline for a violation of Section 493.6118(1)(r), Florida Statutes, as ranging from an administrative fine of $150.00 to $350.00 to probation. There is no separate penalty guideline for a violation of Section 493.6118(1)(f), Florida Statutes.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order dismissing the allegations contained in DOAH Case No. 99-2759 and those in Counts II and III of DOAH Case No. 99-3022. It is further RECOMMENDED that the final order find Respondents guilty of the violations alleged in Count I and Count IV of DOAH Case No. 99-3022, and that it impose an administrative fine against Respondents in the amount of $150.00 for each violation.

DONE AND ENTERED this 11th day of April, 2000, in Tallahassee, Leon County, Florida

CLAUDE B. ARRINGTON

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 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 11th day of April, 2000.

ENDNOTES

1/ Respondent Negron testified that the condition report was for his own records and that a copy was usually given to the client for whom the repossession was made. There was no evidence that this report had any official purpose or that it was required by statute or rule.

2/ Mr. Wood testified that Mr. Negron told him that he estimated the mileage on the BMW. Mr. Negron testified as to the circumstances of the condition report and denied that he told Mr. Wood that he had estimated the mileage on the car.

Respondent's testimony is found to be as credible as Mr. Wood's.

COPIES FURNISHED:

Douglas D. Sunshine, Esquire Department of State

Division of Licensing

The Capitol, Mail Station 4 Tallahassee, Florida 32399-0250

Roderick F. Coleman, Esquire

122 Minorca Avenue

Coral Gables, Florida 33134

Honorable Katherine Harris Secretary of State

The Capitol, Plaza Level 02 Tallahassee, Florida 32399-0250

Deborah K. Kearney, General Counsel Department of State

The Capitol, Lower Level 10 Tallahassee, Florida 32399-0250

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: 99-002759

Orders for Case No: 99-002759