STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

WOERNER SOUTH, INC., d/b/a )

WOERNER TURF, )

)

Petitioner, )

)

vs. ) Case No. 99-4737A

) R & R SOD CONTRACTORS, INC., and ) INSURANCE COMPANY OF NORTH AMERICA, )

)

Respondents. )

)

RECOMMENDED ORDER

Pursuant to notice, a final hearing was conducted in this case on February 11, 2000, by means of a teleconference video connection in Tallahassee and West Palm Beach, Florida, before Administrative Law Judge Michael M. Parrish, of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Ronald Nieporant, National Credit Manager

Woerner South Inc., d/b/a Woerner Turf

505 South Flagler Drive, Suite 606 West Palm Beach, Florida 33401

For Respondent Barbara Rodriguez, President R & R Sod R & R Sod Contractors, Inc. Contractors, 12640 Southwest 51st Street Inc.: Miami, Florida 33175

For Respondent No Appearance Insurance Company

of North America:

STATEMENT OF THE ISSUE

The issue in this case is whether the Respondent, R & R Sod Contractors, Inc., owes the Petitioner for sod purchased from the Petitioner and, if so, the amount presently owed.

PRELIMINARY STATEMENT

In August of 1999, the Petitioner filed a Complaint with the Department of Agriculture and Consumer Services (Department) alleging that the Respondent, R & R Sod Contractors, Inc.

(R & R), had failed to pay the Petitioner for sod the Petitioner had sold to R & R. In the Complaint, the Petitioner asserted that R & R owed a total of $1,649.00. The Insurance Company of North America (ICNA) was identified in the Complaint as surety for R & R. By separate letters dated October 5, 1999, the Department notified R & R and ICNA of the filing of the Petitioner's Complaint and of their opportunity to file a written answer to the Complaint and request a hearing on the matter. Shortly thereafter, R & R filed an answer in which it asserted that it did not owe anything to the Petitioner. On November 9, 1999, the Department referred the matter to the Division of Administrative Hearings.

By means of a Notice of Hearing issued on January 4, 2000, the final hearing was scheduled for February 11, 2000. On January 14, 2000, the Petitioner filed a Motion to Amend Petition in which it requested that "the amount of said petition

be changed to $2,409.00 to reflect additional unpaid invoice amounts that occurred after the date of the original petition." By order issued on January 26, 2000, the motion to amend was granted.

At the final hearing on February 11, 2000, the Petitioner presented the testimony of one witness and offered eleven exhibits (marked A through K), all of which were received in evidence. The Respondent R & R presented the testimony of one witness and offered two exhibits (marked 1 and 2), both of which were received in evidence. 1/

At the conclusion of the final hearing, the parties were allowed until March 2, 2000, within which to submit proposed recommended orders. On February 15, 2000, the Petitioner submitted a two-page document in support of its position. On February 28, 2000, R & R filed a one-page document in support of its position. 2/ These post-hearing documents have been carefully considered during the preparation of this Recommended Order.

FINDINGS OF FACT

1. The Petitioner is in the business of raising and selling sod in the State of Florida. During the past few years, R & R has been a frequent customer of the Petitioner and has purchased large amounts of sod from the Petitioner.

2. Prior to April of 1998, R & R had a credit account with the Petitioner. The terms of the credit agreement included the following: "In the event the account becomes delinquent, and will be referred to a licensed collection agency or an attorney, Customer agrees to pay all costs and expenses of collection including reasonable attorney's fees, court costs, and costs incurred on appeal."

3. During April of 1998, R & R's account with the Petitioner became delinquent. The Petitioner referred the delinquent account to an attorney. The attorney filed a lawsuit against R & R and also filed a complaint with the Department to collect the delinquency by asserting a claim against the bond posted by R & R. The 1998 account delinquencies were resolved in December of 1998, when the Department issued a check to the Petitioner in the amount of $48,431.00. That check paid the full amount of all unpaid invoices from the Petitioner to R & R as of December of 1998.

4. In the process of collecting the $48,431.00 debt from R & R during 1998, the Petitioner incurred costs and attorney's fees in the amount of $1,644.00. These costs and attorney's fees were in addition to the $48,431.00 debt that was paid by the check from the Department.

5. In January of 1999, the Petitioner again began to sell sod to R & R, but only on a cash basis. In the latter part of

   February of 1999, R & R bought approximately $2,500.00 of sod from the Petitioner which they paid for with a $2,500.00 cashier's check payable to the Petitioner. Although the cashier's check was given to the Petitioner by R & R, the face of the cashier's check identified the remitter as "Ely Sod, Inc." 3/

6. At the time the Petitioner received the $2,500.00 cashier's check described above, the Petitioner had an unsatisfied judgment against Ely Sod, Inc. When the cashier's check first went through the Petitioner's bookkeeping system, it was treated as a payment by Ely Sod, Inc., to the Petitioner, and was applied to reduce the amount of the judgment owed by Ely Sod, Inc. Consequently, none of the $2,500.00 cashier's check was initially applied towards the amounts owed by R & R.

7. The misapplication of the proceeds of the $2,500.00 cashier's check discussed above apparently produced a great deal of confusion between the Petitioner and R & R regarding the status of R & R's account with the Petitioner. In this regard the Petitioner was especially concerned about the fact that R & R, which was supposed to be on a "cash only" basis, appeared to be $2,500.00 in arrears in its payments to the Petitioner. During the course of resolving the issue of the misapplied cashier's check, the Petitioner became aware of the fact that

   R & R had never paid the Petitioner's costs and attorney's fees

   related to the 1998 litigation. Ultimately, it was agreed between the attorneys representing the Petitioner and R & R that the proceeds of the $2,500.00 cashier's check should be applied to pay the costs and attorneys fees in the amount of $1,644.00 incurred by the Petitioner in the 1998 litigation, and that the balance of $856.00 would be paid to R & R or would be applied to any outstanding debts of R & R. Consistent with the agreement,

   $1,644.00 was applied to pay the Petitioner's costs and attorneys fees, and $856.00 was applied towards the unpaid amounts owed by R & R for sod purchased from the Petitioner

8. Review of the invoices, payments, and accounts between the Petitioner and R & R reveals that, after the agreed application of funds described in paragraph 7, above, R & R still owes the Petitioner the amount of $1,844.00 for sod purchased from the Petitioner. 4/

   CONCLUSIONS OF LAW

   
   

9. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this proceeding. Sections 120.57(1) and 604.21(6), Florida Statutes.

10. In accordance with Section 604.18, Florida Statutes, a "dealer in agricultural products," as defined in Section 604.15(1), Florida Statutes, must be licensed by the Department to transact business in the State of Florida. "Before any [such] license is issued, the applicant therefor shall make and

    deliver to the [D]epartment a surety bond or certificate of deposit in the amount of at least $3,000 or in such greater amount as the [D]epartment may determine, not exceeding the maximum amount of business done or estimated to be done in any month by the applicant." Section 604.20(1), Florida Statutes.

11. A "dealer in agricultural products" is defined in Section 604.15(1), Florida Statutes, as follows:

    "Dealer in agricultural products" means any person, whether itinerant or domiciled within this state, engaged within this state in the business of purchasing, receiving, or soliciting agricultural products from the producer or her or his agent or representative for resale or processing for sale; acting as an agent for such producer in the sale of agricultural products for the account of the producer on a net return basis; or acting as a negotiating broker between the producer or her or his agent or representative and the buyer.

    
    

12. At all times material hereto, R & R was a "dealer in agricultural products," as defined in Section 604.15(1), Florida Statutes, and was licensed as required by Section 604.18, Florida Statutes.

13. "Agricultural products," within the meaning of Section 604.15(1), Florida Statutes, are defined in Section 604.15(3), Florida Statutes, as follows:

    "Agricultural products" means the natural products of the farm, nursery, grove, orchard, vineyard, garden, and apiary (raw or manufactured); livestock; milk and milk products; poultry and poultry products;

    the fruit of the saw palmetto (meaning the fruit of the Serenoa repens); and limes (meaning the fruit Citrus aurantifolia, variety Persian, Tahiti, Bearss, or Florida Key limes) produced in the state, except tobacco, tropical foliage, sugarcane, and citrus other than limes.

    
    

14. Sod is an agricultural product as defined in Section 604.15(3), Florida Statutes.

15. "Any person claiming herself or himself to be damaged by any breach of the conditions of a bond or certificate of deposit assignment or agreement given by a licensed dealer in agricultural products as hereinbefore provided may enter complaint thereof against the dealer and against the surety, if any, to the [D]epartment, which complaint shall be a written statement of the facts constituting the complaint. Such complaint shall be filed within 6 months from the date of sale in instances involving direct sales or from the date on which the agricultural product was received by the dealer in agricultural products, as agent, to be sold for the producer. No complaint shall be filed pursuant to this section unless the transactions involved total at least $250 and occurred in a single license year." Section 604.21, Florida Statutes.

16. A Section 120.57(1), Florida Statutes, hearing on the complaint must be conducted if there are disputed issues of material fact. The complainant has the burden of proving the allegations of the complaint by a preponderance of the evidence.

    See Florida Department of Transportation v. J.W.C. Company,

    
    

    Inc., 396 So. 2d 778, 788 (Fla. 1st DCA 1981); Florida Department of Health and Rehabilitative Services v. Career Service Commission, 289 So. 2d 412, 415 (Fla. 4th DCA 1974). If the Department determines that the complainant has met its burden of proof, it must "enter its order adjudicating the amount of indebtedness due to be paid by the dealer to the complainant," which order is "final upon issuance." Section 604.21(4), (5) and (6), Florida Statutes.

17. If payment is not made within 15 days after the issuance of the Department's order, the Department must, "in instances involving bonds, call upon the surety company to pay over to the [D]epartment out of the bond posted by the surety for such dealer or, in instances involving certificates of deposit, call upon the financial institution issuing such certificate to pay over to the [D]epartment out of the certificate under the conditions of the assignment or agreement, the amount called for in the order of the [D]epartment, not exceeding the amount of the bond or the principal of the certificate of deposit." Section 604.21(7) and (8), Florida Statutes.

18. In this case the Petitioner filed a timely and sufficient complaint, and proved at hearing that R & R owes

$1,844.00 for sod purchased from the Petitioner. Accordingly,

the Department should issue an order directing R & R to make payment to the Petitioner in the amount of $1,844.00.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby

RECOMMENDED that the Department enter a final order

(1) finding that R & R is indebted to the Petitioner in the amount of $1,844.00; (2) directing R & R to make payment to the Petitioner in the amount of $1,844.00 within 15 days following the issuance of the order; and (3) announcing that if payment in full of this $1,844.00 indebtedness is not timely made, the Department will seek recovery from ICNA, R & R's surety.

DONE AND ENTERED this 7th day of April, 2000, in Tallahassee, Leon County, Florida.

MICHAEL M. PARRISH

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 7th day of April, 2000.

ENDNOTES

1/ During the hearing on February 11, 2000, ruling on the admissibility of R & R's Exhibit number 1 was reserved. Upon further consideration, that Exhibit has been received in evidence.

2/ The post-hearing document filed by R & R also had attached to it copies of 17 pages of documents from the exhibits.

3/ See Petitioner's Exhibit E.

4/ R & R contends in its post-hearing submission that it owes only $200.00. This contention ignores the fact that R & R, through its attorney, agreed that $1,644.00 of the funds paid by R & R should be applied to pay the Petitioner's costs and attorneys fees related to the 1998 litigation.

COPIES FURNISHED:

Ronald Nieporant National Credit Manager

Woerner South Inc., d/b/a Woerner Turf

Suite 606

505 South Flagler Drive

West Palm Beach, Florida 33401

Barbara Rodriguez, President R & R Sod Contractors, Inc. 12640 Southwest 51st Street Miami, Florida 33175

Insurance Company of North America Post Office Box 7716

Philadelphia, Pennsylvania 19192

Honorable Bob Crawford Commissioner of Agriculture Department of Agriculture and

Consumer Services

The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810

Brenda H. Hyatt, Chief Bureau of License and Bond

Department of Agriculture and Consumer Services

Mayo Building, Room 508 Tallahassee, Florida 32399-0800

Richard Tritschler, General Counsel Department of Agriculture and

Consumer Services

The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810

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: 99-004737

Orders for Case No: 99-004737