A final hearing in this matter was held on March 5, 2008, in Largo, Florida, before Lawrence P. Stevenson, a duly- designated Administrative Law Judge of the Division of Administrative Hearings.
The issue is whether Petitioner, Michael Anthony Dipple, is entitled to an award of attorney's fees against Respondent,
Pinellas County Construction Licensing Board, pursuant to Section 57.111, Florida Statutes (2007).1
On January 3, 2008, Petitioner, Michael Anthony Dipple, filed a Motion to Tax Attorney's Fees and Costs (the "Motion"). Pursuant to the Initial Order, Respondent filed a Response to Petitioner's Motion to Tax Attorney's Fees and Costs and Memorandum of Law on January 24, 2008 (the "Response"). In its Response, Respondent admitted that Petitioner was the prevailing party2 in the underlying action, DOAH Case No. 07-3664, and that Respondent was not a nominal party in the underlying action.
Respondent disputes the requested reimbursement of attorney's fees and costs because its actions in bringing the underlying action were substantially justified. In its Response, Respondent requested an evidentiary hearing. Petitioner's Request for an Administrative Hearing was filed on February 6, 2008.
The parties filed a Pre-Hearing Stipulation on March 3, 2008. The parties agreed that the issues remaining for hearing consisted of legal argument surrounding the question of whether Respondent's actions were substantially justified, and that no witnesses would be called at the hearing.
On January 3, 2008, Petitioner filed the Motion, seeking attorney's fees and costs as the prevailing party in DOAH Case No. 07-3664. On November 5, 2007, Respondent filed its Notice of Voluntary Dismissal of DOAH Case No. 07-3664, and the file of the Division of Administrative Hearings was closed by an Order entered on November 6, 2007.
Respondent concedes that Petitioner is a prevailing small business party in the underlying proceeding, pursuant to Section 57.111, Florida Statutes.
In the underlying proceeding, Respondent received a complaint from Joseph Lassen on January 26, 2007. Mr. Lassen stated that Mr. Dipple claimed to have run out of money and was therefore unable to complete the room addition he had contracted to perform on Mr. Lassen's house. Mr. Lassen stated that he feared Mr. Dipple was moving out of state and never had any intention of completing the work.
With his complaint, Mr. Lassen included a copy of the contract, dated May 22, 2006, in which Mr. Dipple undertook to build the new room addition for the price of $76,350. The contract called for an initial deposit of $28,000, followed by three draws of $22,000, $17,000, and $10,000, to be paid as different phases of the work were undertaken. Mr. Lassen also included three canceled checks: one dated May 22, 2006, in the
amount of $28,000; one dated August 8, 2006, in the amount of
$22,000; and one dated September 25, 2006, in the amount of
$18,000.
In a letter dated March 2, 2007, signed by investigator Connie Garriques-Sang and sent to Mr. Dipple's business address in Largo, Respondent informed Mr. Dipple of the complaint. The letter stated, in relevant part:
The enclosed complaint has been filed against you. If you wish to resolve this matter before the Pinellas County Construction Licensing Board takes further action, you may do so. Upon resolution, you should notify our office so that we may update your file on this matter. Please use the attached form in response to the complaint and return it to my office within ten (10) working days. (Emphasis added.)
Respondent's probable cause panel convened on March 22, 2007. At that time, no response from Mr. Dipple had been received by Respondent. The probable cause panel considered
Mr. Lassen's complaint and the attachments thereto. The panel also considered information obtained by Ms. Garriques-Sang from the City of Largo's building inspector indicating there were code violations regarding electrical work that were holding up the final inspection. Based on the information before it, the panel found probable cause to proceed with disciplinary action against Mr. Dipple.
Mr. Dipple's response to Ms. Garriques-Sang's letter was received by Respondent on March 23, 2007, the day after the probable cause panel met and voted to proceed with an Administrative Complaint against Mr. Dipple. The delay in
Mr. Dipple's response was due in part to the fact that he had moved to Oklahoma and the letter had to be forwarded to his new address. Nonetheless, he dated his response March 13, 2007, indicating that he must have received Ms. Garriques-Sang's letter on or before that date. However, the postmark on the envelope containing Mr. Dipple's response indicates that he waited an additional week, until March 20, 2007, to actually mail the response.
Mr. Dipple's response included a letter from his attorney to Mr. Lassen and a copy of a phone message3 that
Mr. Lassen left at Mr. Dipple's place of business stating that Mr. Lassen wanted another company to finish the work.
Mr. Dipple generally contended that Mr. Lassen thwarted his attempts to complete the job.
Respondent issued an Administrative Complaint, dated March 30, 2007, alleging the following facts: Mr. Dipple contracted with Mr. Lassen on February 22, 2006, to build a room addition at Mr. Lassen's Largo home; that Mr. Dipple obtained a permit for the work on June 23, 2006; that the permit was active, but work was not complete and there were outstanding
tags for code deficiencies; that Mr. Dipple had changed his business address and had not performed any work on Mr. Lassen's house for over 90 days; that Mr. Dipple had informed Mr. Lassen that he did not have enough money to finish the job; and that Mr. Lassen was forced to hire another contractor to finish the job, at additional expense.
The Administrative Complaint had three counts. Count One alleged that Mr. Dipple abandoned the job in violation of Subsection 489.129(1)(j), Florida Statutes, and Section 24(2)(k), Chapter 75-489, Laws of Florida, as amended. Count Two alleged that Mr. Dipple committed financial mismanagement or misconduct in the practice of contracting that caused financial harm to a customer in violation of Subsections 489.126(2) and (4), Florida Statutes, Subsection 489.129(1)(g), Florida Statutes, and Section 24(2)(h), Chapter 75-489, Laws of Florida, as amended. Count Three alleged that Mr. Dipple committed fraud or deceit or gross negligence, incompetency, or misconduct in the practice of contracting in violation of Subsection 489.129(1)(m), Florida Statutes, and Section 24(2)(m), Chapter 75-489, Laws of Florida, as amended.
The case was referred to the Division of Administrative Hearings on August 16, 2007, and assigned DOAH Case No. 07-3664. With the Administrative Complaint, Respondent forwarded Mr. Dipple's Motion to Dismiss and Statement of Facts,
originally served on Respondent on August 9, 2007. Mr. Dipple denied the allegations of the Administrative Complaint, stating that Mr. Lassen had interfered with the contract by refusing to allow Mr. Dipple to work on scheduled days; that Mr. Lassen wrongfully terminated the contract before the work was completed and refused to allow Mr. Dipple to complete the work; that
Mr. Lassen owed money to Mr. Dipple; and that all portions of the work performed by Mr. Dipple had passed all building inspections. Mr. Dipple moved that the charges be dismissed on the ground that the alleged facts did not support any of the three counts stated in the Administrative Complaint.
With the Administrative Complaint, Respondent also forwarded Mr. Dipple's notice to Respondent of his intent to recover attorney's fees and costs, originally served on Respondent on July 20, 2007.
DOAH Case No. 07-3664 was scheduled for hearing on September 24, 2007, in Largo, Florida. On Mr. Dipple's motion, the hearing was continued and rescheduled for November 27, 2007.
On November 5, 2007, Respondent filed its Notice of Voluntary Dismissal of the Administrative Complaint. The Division of Administrative Hearings' file in DOAH Case No. 07- 3663 was closed by Order dated November 6, 2007.
Mr. Dipple's contends that the probable cause panel lacked other available information that could have and in fact
did subsequently exonerate him of the charges,4 and that Respondent violated its own rules, Chapters 455 and 489, Florida Statutes, and fundamental principles of due process in precipitously arriving at a probable cause determination before Mr. Dipple had a fair opportunity to respond to the March 2, 2007, letter from Ms. Garriques-Sang.
It is found that the information before the probable cause panel was sufficient to support the panel's decision to pursue an Administrative Complaint against Mr. Dipple, in the absence of any contrary information.
The evidence submitted in Mr. Dipple's March 23, 2007, response to Mr. Lassen's allegations provided an insufficient basis for a finding that the response would have altered the probable cause panel's decision. While it does appear that
Mr. Dipple submitted evidence that Mr. Lassen had instructed him to stop work, such evidence did not necessarily refute
Mr. Lassen's allegations that Mr. Dipple's actions had forced him to seek another contractor to complete the job.
Mr. Lassen also alleged something approaching fraud against Mr. Dipple, stating that he feared Mr. Dipple was planning to move away from Largo and never intended to complete the work. Mr. Dipple's response did not directly address this allegation. Further, even if the probable cause panel had timely received Mr. Dipple's response, the fact that the
response was mailed from Mr. Dipple's new residence in Oklahoma would, if anything, have provided circumstantial support to
Mr. Lassen's allegations.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this proceeding pursuant to Sections 120.569, and Subsections 120.57(1), and 57.111(4), Florida Statutes.
Section 57.111, Florida Statutes, the Florida Equal Access to Justice Act, provides, in pertinent part, as follows:
(4)(a) Unless otherwise provided by law, an award of attorney's fees and costs shall be made to a prevailing small business party in any adjudicatory proceeding or administrative proceeding pursuant to chapter 120 initiated by a state agency, unless the actions of the agency were substantially justified or special circumstances exist which would make the award unjust.
In proceedings to establish entitlement to an award of attorney's fees and costs pursuant to Section 57.111, Florida Statutes, the initial burden of proof is on the party requesting the award to establish by a preponderance of the evidence that it prevailed in the underlying disciplinary action and that it was a small business party at the time the disciplinary action was initiated. Once the party requesting the award has met this burden, the burden of proof shifts to the agency to establish
that it was substantially justified in initiating the disciplinary action. See Helmy v. Department of Business and Professional Regulation, 707 So. 2d 366, 368 (Fla. 1st DCA 1998); Department of Professional Regulation, Division of Real
Estate v. Toledo Realty, Inc. and Ramiro Alfert, 549 So. 2d 715, 717 (Fla. 1st DCA 1989).
Petitioner, Michael Anthony Dipple, prevailed in the underlying proceeding. § 57.111(3)(c)3., Fla. Stat.
Mr. Dipple is a "small business party" as contemplated by Subsection 57.111(3)(d), Florida Statutes.
The sole issue in this proceeding is whether Respondent's actions were "substantially justified." Subsection 57.111(3)(e), Florida Statutes, provides that a proceeding is "substantially justified" if it had a "reasonable basis in law and fact at the time it was initiated by a state agency." (Emphasis added.) The "substantially justified" standard falls somewhere between the "no justiciable issue" standard of Section 57.105, Florida Statutes, and an automatic award of fees to a prevailing party. Helmy, 707 So. 2d at 368.
In Department of Health v. Cralle, 852 So. 2d 930, 932 (Fla. 1st DCA 2003), the court set forth the following temporal limitation on the required analysis, quoting from Fish v. Department of Health, 825 So. 2d 421, 423 (Fla. 4th DCA 2002):
In resolving whether there was substantial justification or a reasonable basis in law and fact for filing an administrative complaint, "one need only examine the information before the probable cause panel at the time it found probable cause and directed the filing of an administrative complaint."
See also Agency for Health Care Administration v. Gonzalez, 657 So. 2d 56 (Fla. 1st DCA 1995)(proper inquiry is whether evidence before probable cause panel was sufficient for institution of disciplinary action).
In Fish, the Department of Health commenced an investigation against Dr. Fish pursuant to a complaint filed by a fellow dentist. After the investigation was completed, the Department forwarded the investigative file to the probable cause panel. Dr. Fish had disputed the allegations and filed a timely written response, but the Department chose not to forward his response to the probable cause panel. 825 So. 2d at 422. The panel found probable cause and forwarded the matter to the Division of Administrative Hearings. The Department subsequently dismissed the case, and Dr. Fish petitioned for attorney's fees pursuant to Section 57.111, Florida Statutes.
One of the grounds asserted by Dr. Fish was that the Department denied him due process by failing to forward his response to the probable cause panel. In affirming the Administrative Law Judge's conclusion that the Department was
substantially justified in proceeding against Dr. Fish, the court reasoned as follows:
Notwithstanding the existence of a procedural due process error due to the Probable Cause Panel's failure to review appellant's timely response, we nevertheless conclude that there existed competent substantial evidence to support the ALJ's finding of substantial justification.
Although the charges brought against appellant were subsequently withdrawn and the DOAH action dismissed, a review of the record and investigative file reveals that the Department was substantially justified at the time it initiated its disciplinary action. The DOAH action against appellant was dismissed, not because of any procedural irregularity, as espoused by appellant, but because two of the Department's key witnesses died and one witness had a disciplinary history with the Florida Bar.
Thus, the Department strategically decided to forego any further prosecution against appellant.
The record supports the conclusion that the Probable Cause Panel had the complete investigative file before it prior to its consideration of appellant's case. And, while the Probable Cause Panel should have considered appellant's response prior to its determination to proceed with an administrative complaint, there is no evidence to conclude that the Probable Cause Panel would have reached a different result had it considered his response. Appellant's response to the investigative file disputed the allegations against him, but did not disprove or conclusively rebut those allegations. In fact, appellant's response highlighted the fact that there were disputed issues of fact as to the charges against him.
Id. at 423.
In Fish as in the instant case, the information before the probable cause panel substantially justified the panel's determination, and the question was whether the panel's decision was skewed because it did not have all of the relevant information before it. The Fish court found that the agency's failure to place the petitioner's response to the allegations before the probable cause panel constituted a procedural due process error. However, the court went on to hold that such a procedural error was insufficient to overturn the finding that the agency's actions were substantially justified, unless that procedural error compromised the accuracy and integrity of the probable cause process.
In the instant case, it is questionable whether there was a due process error at all. The due process error in Fish consisted of the Department's conscious decision to withhold Dr. Fish's response from the probable cause panel. In the instant case, Respondent did not yet have Mr. Dipple's response at the time the matter was submitted to the probable cause panel. In any event, the record evidence was insufficient to establish that Mr. Dipple's response would have changed the
result reached by the probable cause panel. The record evidence also failed to establish any necessary connection between
Mr. Dipple's late-filed response and the agency's ultimate decision to dismiss the Administrative Complaint. Thus, any
procedural error committed by Respondent in failing to provide Mr. Dipple with adequate time to respond to Ms. Garriques-Sang's initial letter was insufficient to change the finding that the probable cause panel's decision to move forward with an Administrative Complaint was substantially justified at the time it was made.
Mr. Dipple pointed to no Pinellas County Construction Licensing Board rule requiring that a licensee be allowed to respond to a complaint before probable cause may be found to proceed with an Administrative Complaint against that licensee.
Mr. Dipple contends that because he is a state licensed contractor, and because some of the counts of the Administrative Complaint alleged violations of Chapter 489, Florida Statutes, the procedural provisions of Chapters 455 and 489, Florida Statutes, are applicable to Respondent's probable cause process.
Mr. Dipple points to Subsection 455.225(1)(b), Florida Statutes, which provides:
When an investigation of any subject is undertaken, the [Department of Business and Professional Regulation] shall promptly furnish to the subject or the subject's attorney a copy of the complaint or document that resulted in the initiation of the investigation. The subject may submit a written response to the information contained in such complaint or document within 20 days after service to the subject of the complaint or document. The subject's
written response shall be considered by the probable cause panel. The right to respond does not prohibit the issuance of a summary emergency order if necessary to protect the public. However, if the secretary, or the secretary's designee, and the chair of the respective board or the chair of its probable cause panel agree in writing that such notification would be detrimental to the investigation, the department may withhold notification. The department may conduct an investigation without notification to any subject if the act under investigation is a criminal offense. (Emphasis added.)
Mr. Dipple contends that the underscored language required Respondent to give him 20 days, not "10 working days," in which to respond to Mr. Lassen's complaint. He also contends that the underscored language required the probable cause panel to consider his response.
However, Mr. Dipple neglects to note that Section 455.017, Florida Statutes, provides: "The provisions of this chapter apply only to the regulation by the department of professions." Section 455.225, Florida Statutes, is therefore inapplicable to Respondent, a local government entity responsible for disciplinary enforcement of construction licensing requirements in Pinellas County, Florida. Ch. 75-489,
§§ 10, 23(2)(a), and 24, Laws of Fla., codified at Ch. 26, art. III, div. 2, Pinellas County Code.
In summary, Mr. Dipple was the prevailing small business party in the underlying proceeding. However,
Respondent established that its actions were substantially justified, in that it had a reasonable basis in law and fact at the time probable cause was found.
ORDERED that Michael Anthony Dipple's Motion to Tax for Attorney's Fees and Costs is denied.
DONE AND ORDERED this 14th day of April, 2008, in Tallahassee, Leon County, Florida.
LAWRENCE P. STEVENSON
Filed with the Clerk of the Division of Administrative Hearings this 14th day of April, 2008.
1/ All references are to Florida Statutes (2007), unless otherwise noted.
2/ Respondent initially disputed that Petitioner was a small business party, but later stipulated that Respondent is a prevailing small business party.
3/ The record in the instant case includes Mr. Dipple's response but not the attachments thereto. It unclear from the text of Mr. Dipple's response whether Mr. Dipple provided Respondent with a copy of his answering machine tape or with a written transcription of Mr. Lassen's call.
4/ It must be noted that Respondent took no express position on its reasons for dismissing the prosecution. The Notice of Voluntary Dismissal stated simply that Respondent was voluntarily dismissing the matter, "without prejudice."
Rodney S. Fischer, Executive Director Pinellas County Construction Licensing Board 11701 Belcher Road, Suite 102
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 the original notice of appeal with the Clerk of the Division of Administrative Hearings and a 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.
