STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, DIVISION OF REAL ESTATE,

Petitioner,

vs.

VICTORIA D. WIEDLE AND ESCAROSA REALTY, INC.,

Respondents.

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) Case No. 01-2076PL

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RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on April 25, 2002, in Pensacola, Florida, before the Division of Administrative Hearings, by its designated Administrative Law Judge, Barbara J. Staros.

APPEARANCES

For Petitioner: Juana Carstarphen Watkins, Esquire

Department of Business and Professional Regulation

400 West Robinson Street

Hurston Building-North Tower, Suite N308 Orlando, Florida 32801

For Respondent: Victoria D. Wiedle, pro se

4368 Casa Grande Court Milton, Florida 32583

Victoria D. Wiedle, pro se

157 Mirabelle Circle Pensacola, Florida 32514

STATEMENT OF THE ISSUE

Is Respondent, Victoria D. Wiedle, guilty of failure to account for and deliver funds, in violation of Section 475.25(1)(d)1, Florida Statutes, and, if so, what is the appropriate penalty.

PRELIMINARY STATEMENT

Petitioner, through its Administrative Complaint, accused Respondents, Victoria D. Wiedle and Escarosa Realty, Inc., of failure to account and deliver funds, in violation of Section 475.25(1)(d)1, Florida Statutes.

Respondent Wiedle disputed the allegations in the Administrative Complaint and timely requested an administrative hearing. The request for hearing was forwarded to the Division of Administrative Hearings on or about May 25, 2001. A hearing was scheduled for July 31, 2001. Respondent Wiedle requested a continuance of the hearing for health reasons. The request was granted and the case was rescheduled for hearing on April 25, 2002. On April 18, 2002, Respondent filed a Motion to Relinquish Jurisdiction of Company, based upon Respondent's, Escarosa Realty, Inc.'s, license now being void.

The case was reassigned to the undersigned. The Motion to Relinquish Jurisdiction of Company was heard at the commencement of the hearing and was granted. The hearing proceeded only involving the allegations against Respondent Wiedle.

At hearing, Petitioner presented the testimony of four witnesses: Jan Christian, Elnora Alexander, Beverly Lewis, and Fred Clanton. Petitioner's Exhibits 1 through 14 were admitted into evidence. Respondent testified on her own behalf.

Respondent's Exhibits 1, 2, 4, and 9 through 14 were admitted into evidence. Respondent's Exhibit 3 was rejected.

Respondent's Exhibits 7 and 8 were withdrawn.

Respondent's proposed Exhibit 5 was an affidavit of Ms. Roberta Lynn. Respondent stated that Ms. Lynn was not available to attend the hearing but had not been subpoenaed.

Respondent sought to have Ms. Lynn's affidavit admitted in lieu of her in-person testimony. While the affidavit was rejected, the record was left open to give Respondent an opportunity to conduct a deposition of Ms. Lynn within two weeks of the hearing, and then file Ms. Lynn's deposition testimony for consideration in lieu of her in person testimony.

Official recognition was taken of Chapters 20, 120, 455, and 475, Florida Statutes.

The parties were given an opportunity to submit post- hearing submissions within 10 days of the filing of the hearing transcript or of the deposition transcript of Ms. Lynn, whichever was filed later. A Transcript consisting of one volume was filed on May 1, 2002. The deposition of Ms. Lynn did not take place. On May 9, 2002, a telephone conference call was

held in which the parties requested and were granted until May 24, 2002, to submit post-hearing submissions. Each party

submitted a post-hearing submission on May 23, 2002, which have been considered in the preparation of this Recommended Order.

FINDINGS OF FACT

1. Petitioner is the state agency charged with the responsibility and duty to prosecute administrative complaints pursuant to Section 20.165 and Chapters 120, 455, and 475, Florida Statutes.

2. At all times material hereto, Respondent Wiedle was a licensed real estate broker, having been issued license number BK-0646846, and was principal broker of Escarosa Realty. Respondent's license is still active.

3. Janice Marlene Christian is a realtor associate. She was an independent contractor with Escarosa Realty from December 1998 until April 1999. Accordingly, Respondent Wiedle was

   Ms. Christian's registered broker during this time.

   
   

4. Ms. Beverly Lewis is the mother-in-law of

   
   

   Ms. Christian's brother. Ms. Lewis came to Ms. Christian in February 1999 because she was interested in looking for and purchasing a house. On February 16, 1999, Ms. Christian facilitated an Exclusive Buyer Brokerage Agreement (the Agreement) on behalf of Escarosa Realty with Ms. Lewis. The Agreement was on a form created by Formulator, a software

   company. "Florida Association of Realtors" appears on the face of the document.

5. Paragraph 6 of the Agreement reads in pertinent part:

   
   

   RETAINER: Upon final execution of this agreement, Buyer will pay to Broker a non- refundable retainer fee of $0 for Broker's services ("Retainer").

   
   

   Accordingly, Respondent was not entitled to any money as a retainer fee for broker services pursuant to this agreement.

6. The agreement was signed by Ms. Lewis, Ms. Christian, and Ms. Wiedle and became effective on February 16, 1999. The specified termination date of the agreement was August 17, 1999.

7. On or about February 27, 1999, Ms. Christian tendered an offer to sellers on behalf of Ms. Lewis, for property located at 107 Poi Avenue in Santa Rosa County (subject property).

8. Pursuant to this offer, Ms. Lewis gave a $500.00 check dated February 27, 1999, to Ms. Christian as earnest money. The check is made out as follows: "Escarosa Realty Inc. Escrow". Ms. Lewis wrote in the memo section of the check that the check was escrow money for 107 Poi Terrace.

9. The $500.00 check was deposited in Escarosa Realty's escrow account on March 1, 1999. Respondent accounted for the

   $500.00 check on the March 1999 monthly reconciliation statement for Escarosa Realty.

10. The seller of the subject property made a counter- offer for a higher price which Ms. Lewis rejected.

11. The testimony differs as to what happened next.

    
    

    According to Ms. Christian, Ms. Christian spoke to Respondent sometime after Ms. Lewis rejected the counter-offer about refunding the escrow money to Ms. Lewis. According to

    Ms. Christian, Respondent informed her that she did not have to give the escrow money back to Ms. Lewis yet because she had the buyer broker agreement. Ms. Christian further asserts that she filled out a written request on March 16, 1999, on a form entitled "EMD Request," which means earnest money deposit request, and gave it to Respondent who again asserted that the

    $500.00 did not need to be returned at that time because of the buyer brokerage agreement.

12. Ms. Christian's testimony is consistent with Ms. Lewis's. According to Ms. Lewis, she talked to

    Ms. Christian about getting a refund of the $500.00 shortly after she rejected the counter-offer. She and Ms. Christian discussed the EMD form. She initially agreed that Respondent could temporarily maintain the escrow funds. However, when

    Ms. Lewis discovered that the financing she was seeking through the rural development program would take several months, she decided she wanted the money returned.

13. Ms. Christian ended her contract with Escarosa Realty effective April 14, 1999. Because Ms. Christian was no longer at Escarosa, Ms. Lewis contacted Respondent by telephone on or about April 21, 1999. Ms. Lewis informed Respondent about the purchase offer and rejection of the counter-offer for the subject property. According to Ms. Lewis, Respondent initially told her she would return the money to her in the mail. When she did not receive it, Ms. Lewis again called Respondent and was told that the $500.00 would not be returned because of the buyer brokerage agreement was still in place. Ms. Lewis asserts that Respondent never told her any request for a refund of the

    $500.00 had to be in writing.

    
    

14. Ms. Lewis then went to the Escarosa Realty office.

    
    

    Ms. Weidle was not there but Elnora Alexander was there. Ms. Alexander was also a realtor associate who was an independent contractor with Escarosa Realty. Ms. Lewis explained to Ms. Alexander about the circumstances of the

    subject property and that she wanted her earnest money back. Ms. Alexander gave a copy of the buyer broker agreement to Ms. Lewis. After going to Escarosa Realty, Ms. Lewis had

    numerous other telephone conversations with Respondent about the money.

15. Respondent denies any knowledge of the Poi Terrace failed transaction until she spoke to Ms. Lewis on the phone. She also denied ever receiving the EMD request from

    Ms. Christian. Respondent asserts that she repeatedly told Ms. Lewis that she would return the $500.00 if Ms. Lewis would only make a request in writing, but that Ms. Lewis refused.

    This assertion is not credible. It is inconceivable that after all of the efforts made by Ms. Lewis to get her $500.00 returned to her, that she would refuse to make a written request for the money.

16. In any event, there is no dispute that Ms. Lewis made verbal requests to Respondent for the return of the escrow monies. Respondent Wiedle admits that Ms. Lewis requested the money over the telephone. Further, in an April 2, 2001 letter from Respondent to the Division of Real Estate, Respondent acknowledged that Ms. Lewis asked for a refund of the money in the beginning of May and again in early June of 1999. Clearly, if Respondent Wiedle had not previously been aware of the failed Poi Terrace transaction, she was made aware of it during the telephone conversations with Ms. Lewis.

17. Notwithstanding Respondent's assertion that the reason she did not refund the $500.00 to Ms. Lewis was that the request was not in writing, it is clear from Respondent's testimony and from a letter she wrote to Mr. Clanton, Petitioner's

    investigator, that she believed the $500.00 was connected to the buyer brokerage agreement, not to any offer for purchase of property. In an undated letter from Respondent Wiedle to

    Mr. Clanton, Respondent wrote:

    
    

    Dear Mr. Clanton,

    
    

    This is in response to your letter dated August 17th, 1999. First Beverly A. Lewis was refunded her money on August 20, 1999 check #111. Second I would like to respond to her complaint. Beverly A. Lewis signed a Exclusive Buyer Brokerage Agreement with EscaRosa Realty, Inc. on February 16th, 1999 with it to terminate on August 17th 1999.

    Beverly A. Lewis knew that her deposit was a refundable deposit after the agreement is expired not before. As the Broker of this company I had no contact with Beverly Lewis until the agent Marlene Christian was asked to leave the company. If there ever was a contract for her to purchase a house then her agent Marlene Christian never informed me of nor did she ever provide any such contract. The deposit was given to me with the Exclusive Buyer Brokerage Agreement only. Nor did her agent Marlene ever fill out the EMD refund request form requesting a refund to be given to Beverly A. Lewis.

    However, The result would have been the same. I asked Beverly Lewis If she had changed her mind on purchasing a house she said no she was still going to buy a house but that she knew if she didn't buy her house through Marlene at her new company that Marlene would make life very hard on her. I told her I was sorry but that is the whole purpose in the contract was to secure your buyers from just going all over the place. . . .(emphasis supplied)

    
    

18. Respondent refunded the $500.00 to Ms. Lewis on August 10, 1999.

19. At hearing, Respondent volunteered that there was a previous complaint against her for failing to return money she held under a buyer brokerage agreement with a former client. In that instance, the Probable Cause Panel of the Florida Real Estate Commission found no probable cause but issued a letter of guidance to Respondent.1

    CONCLUSIONS OF LAW

    
    

20. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this proceeding in accordance with Sections 120.569 and 120.57, Florida Statutes.

21. The Department of Business and Professional Regulation, Division of Real Estate, has the duty to regulate real estate licenses in Florida pursuant to Chapter 475, Florida Statutes. The Petitioner has the burden of proving the material allegations of the Administrative Complaint by clear and convincing evidence. Ferris v. Turlington, 510 So. 2d 292 (Fla. 1987).

22. Because she is a broker, Respondent is charged with the knowledge of Chapter 475, Florida Statutes. Wallen v. Florida Department of Professional Regulation, 568 So. 2d 975 (Fla. 3rd DCA 1990).

23. Petitioner charged Respondent with failing to account or deliver funds in violation of Section 475.25(1)(d)1., Florida Statutes, which reads in pertinent part:

    Has failed to account or deliver to any person, including a licensee under this chapter, at the time which has been agreed upon or is required by law or, in the absence of a fixed time, upon demand of the person entitled to such accounting and delivery, any person property such as money, fund, deposit, check, draft abstract of title, mortgage, conveyance, lease, or other document or thing of value, . . . (emphasis supplied)

    
    

24. Rule 61J2-14.008, Florida Administrative Code, defines a deposit as "a sum of money, or its equivalent, delivered to a real estate licensee, as earnest money . . . in connection with any real estate transaction named or described in Section 475.01(1)(a), Florida Statutes." Section 475.01(1)(a), Florida Statutes, clearly references transactions involving attempts to negotiate the sale or purchase of real estate. The evidence clearly established that the check given to Respondent by

    Ms. Lewis is a deposit within the rule definition, not a retainer fee for broker services.

25. Respondent Wiedle had no authority to withhold Ms. Lewis' escrow money. Her reliance on the buyer broker

    agreement as justification for not refunding the escrow money upon demand is misplaced and reflects confusion as to the law by Respondent.

26. Section 475.25(1)(d)1, Florida Statutes, imposes a duty on the broker to act when a party makes a demand for the funds. The evidence established that Ms. Lewis made great efforts to secure the refund of her escrow deposit. Even if Respondent had not received a written EMD request from

    Ms. Christian in April 1999, there is no requirement in the Florida Statutes that supports Respondent Weidle's insistence that Ms. Lewis put her demand for refund in writing.

27. Rule 61J2-24.001, Florida Administrative Code, sets forth a recommended range of penalties for licensees who violate Chapters 455 or 475, Florida Statutes. The Rule states that for purposes of this Rule, the order of penalties, ranging from lowest to highest is: reprimand, fine, probation, suspension, and revocation or denial. The range of penalties for a violation of Section 475.25(1)(d), Florida Statutes, is from an administrative fine of $1,000.00 to a 5-year suspension. Further, aggravating or mitigating circumstances may be considered in arriving at an appropriate penalty, including the severity of the offense and the degree of harm to the consumer.2

28. Petitioner seeks a penalty of an administrative fine of $1,000.00 and suspension of her license for two years. The evidence does not support the severity of the penalty sought by Petitioner. There were no allegations or evidence that Respondent improperly accounted for the escrow money, just that

she did not refund it in a timely manner. There were no allegations that Respondent converted the money for her own use or used it for any fraudulent purposes. She eventually refunded the escrow money in full to Ms. Lewis three days after the expiration of the buyer brokerage agreement which Respondent relied upon in keeping the $500.00 in her escrow account. While Ms. Lewis was harmed by the temporary loss of use of her money and the aggravation of attempting to get it back, the offense is not so severe as to warrant the penalty sought by Petitioner.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, the evidence of record and the demeanor of the witnesses, it is

RECOMMENDED:

That a final order be entered by the Florida Real Estate Commission finding the Respondent, Victoria D. Wiedle, guilty of violating Section 475.25(1)(d), Florida Statutes, in that she failed to deliver escrow money upon demand, imposing a fine of

$1,000.00, and placing Respondent Wiedle on probation for a period of two years. As conditions of probation, Respondent should be required to attend a continuing education course which addresses appropriate handling of escrow funds and be subject to periodic inspections and interviews by a Department of Business and Professional Regulation investigator.

DONE AND ENTERED this 14th day of June, 2002, in Tallahassee, Leon County, Florida.

BARBARA J. STAROS

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 14th day of June, 2002.

ENDNOTES

1/ Respondent waived her right to confidentiality of the content of Respondent's Exhibit 12, pursuant to Section 455.225(10), Florida Statutes.

2/ Rule 61J2-24.001(4)(b)8., Florida Administrative Code, states that if a letter of guidance has previously been issued to the licensee, that also may be considered as an aggravating circumstance. However, the letter of guidance previously issued to Respondent specifically states that it does not constitute a disciplinary record against Respondent for any purpose and is not appealable. Accordingly, for this reason and for fundamental due process considerations, the issuance of a previous letter of guidance was not considered as an aggravating factor in the recommendation of an appropriate penalty herein.

COPIES FURNISHED:

Juana Carstarphen Watkins, Esquire Department of Business and

Professional Regulation

400 West Robinson Street

Hurston Building North Tower, Suite N308 Orlando, Florida 32801

Victoria D. Wiedle 4368 Casa Grande Court Milton, Florida 32583

Victoria D. Wiedle

157 Mirabelle Circle Pensacola, Florida 32514

Dean Saunders, Chairperson Florida Real Estate Commission

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

Hardy L. Roberts, III, General Counsel Department of Business and

Professional Regulation Northwood Centre

1940 North Monroe Street Tallahassee, Florida 32399-2202

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: 01-002076PL

Orders for Case No: 01-002076PL