This case came before Administrative Law Judge John G. Van Laningham for final hearing by telephone conference on July 22, 2008, at sites in Tallahassee and Lauderdale Lakes, Florida.
The issues in this case are whether Respondent, who was never licensed as a contractor, engaged in the unlawful practice of contracting when he entered into (and attempted to perform
under) an agreement to build a dental office; and whether, if Respondent is found guilty of unlicensed contracting, Petitioner should penalize him by imposing an administrative fine and assessing investigative costs.
On April 3, 2008, Petitioner Department of Business and Professional Regulation issued a two-count Administrative Complaint against Respondent James Bresnahan, wherein it was alleged that he had practiced contracting without a license, in violation of Florida law. Mr. Bresnahan timely requested a formal hearing to contest the allegations, and the matter was referred to the Division of Administrative Hearings on May 15,
2008.
was continued to July 22, 2008, at the Department's request. Both parties appeared at the final hearing, which took place as scheduled.
At hearing, the Department presented the testimony of four witnesses: Linda Commons, Angela Griffin, John Lee, and Norma Fishner. In addition, Petitioner's Exhibits 1 through 8 were admitted into evidence. Mr. Bresnahan testified on his own behalf and also called Wesley J. Curran to the witness stand.
Mr. Bresnahan offered one exhibit, which was received in evidence as Respondent's Exhibit 1.
The final hearing transcript was filed on August 26, 2008.
Each party thereafter submitted a Proposed Recommended Order, and the undersigned has considered these papers.
Unless otherwise indicated, citations to the Florida Statutes refer to the 2007 Florida Statutes.
Petitioner Department of Business and Professional Regulation ("Department") has jurisdiction to take punitive action against unlicensed persons who unlawfully engage in the business of contracting.
At no time relevant to this proceeding was Respondent James Bresnahan ("Bresnahan") licensed, certified, or registered to do business as a contractor of any sort.
In June 2007, Bresnahan entered into a contract with University Dental Health Care Center, Inc. ("University"), whereby, in exchange for University's agreement to pay Bresnahan a total of $42,350 in compensation for his work, Bresnahan promised to remodel a bay at the Shoppes of Rolling Hills ("Rolling Hills"), a shopping center located in Davie, Florida, where University planned to operate a dental office.
The contract described the scope of the work that Bresnahan would perform as follows:
Remove all walls per plans.
Redesign interior space to reflect new office plans.
New electrical per plans.
New plumbing per plans.
New droped [sic] ceiling and lighting per plans per Ken.
Finish all walls with new paint colors per Angela.
New flooring [illegible] tile to be picked by owner.
Install new compressor bracket on back of building.
Bring all utilities to dental chairs (vac[uum], water, electric, air and drain; five chairs per plans per Ken.
Proposal is for drawings and permits and construction of office.
Cabinets and installation by others.
Equipment and plumbing fixtures by others per Ken.
Handycap [sic] bathroom by Shops [sic] of Rolling Hills.
(Quoted text reformatted from "all uppercase" to "sentence case.")
Bresnahan had not previously undertaken a construction project such as this. He had, however, overseen the build-out of his wife's bakery, which was located in Rolling Hills. For that project, Bresnahan had engaged a general contractor, Johnson Beckett, Inc. ("Johnson Beckett"). Bresnahan, in other words, had been the client, Johnson Beckett the builder.
Bresnahan had been introduced to University's principals by their mutual landlord, who——perhaps being unaware of Bresnahan's actual role in the construction of the bakery—— touted Bresnahan as a "builder." Bresnahan had not advertised or promoted himself as a builder, but neither did he disclaim
such expertise upon meeting the principals of University; to the contrary, he ultimately offered to build a dental office for University, leading to the contract described above.
On June 21, 2007, upon entering into the construction agreement with Bresnahan, University made a down payment of
$10,000 to Bresnahan. Because he was not in fact a builder, Bresnahan's plan was to use this money, and other payments he would receive from University, to hire Johnson Beckett to act as the "general contractor" for all aspects of the project except the plumbing and electrical work, for which Bresnahan intended to engage separate subcontractors. Johnson Beckett would not bid a fixed price for the project, however, without a proper construction plan. Consequently, Bresnahan entered into a contract (in his personal capacity, not as an agent for University) with Johnson Beckett, pursuant to which the general contactor was to obtain a blueprint for the dental office project, appropriately sealed by a licensed engineer. For this drafting work, Bresnahan agreed to pay Johnson Beckett $5,000.
As Johnson Beckett proceeded, it encountered some difficulty in obtaining information, which the engineer needed, concerning the equipment that would be installed in the dental office. Meantime, little or no work was being accomplished at the jobsite, which began to create tensions between Bresnahan
and University. Nevertheless, University gave Bresnahan another check, for $5,000, on July 19, 2007.
As the weeks passed, however, University became increasingly frustrated at the lack of tangible progress; it began to lose patience with Bresnahan. When Linda Commons, an owner of the company, started pressing Bresnahan for an accounting, the relationship deteriorated further. On or around August 21, 2007, Bresnahan sent University a letter that announced he was unilaterally canceling their contract. Thereupon, Bresnahan abandoned the job.
As of the final hearing, Bresnahan had not refunded to University any of the compensation he received.
In connection with the instant matter, the Department has incurred investigative costs in the amount of $209.55.
Ultimate Factual Determinations
Bresnahan's negotiation of, entry into, and attempt to perform under the construction agreement with University constituted the practice of contracting under Florida law.
Thus, Bresnahan, who was not a licensed contractor, is guilty of unlicensed contracting, as charged in Count I of the Administrative Complaint.
Bresnahan's negotiation of, entry into, and attempt to perform under the construction agreement with University also constituted the practice of electrical contracting under Florida
law. Thus, Bresnahan, who was not a licensed electrical contractor, is guilty of unlicensed electrical contracting, as charged in Count II of the Administrative Complaint.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has personal and subject matter jurisdiction in this proceeding pursuant to Sections 120.569 and 120.57(1), Florida Statutes(2008).
As the party asserting the affirmative in this administrative proceeding, the Department owns the burden of proof. See, e.g., Florida Department of Transportation v. J.W.C. Co., Inc., 396 So. 2d 778, 788 (Fla. 1st DCA 1981); Balino v. Department of Health and Rehabilitative Services, 348 So. 2d 349, 350 (Fla. 1st DCA 1977)("The general rule is, that as in court proceedings, the burden of proof, apart from statute, is on the party asserting the affirmative of an issue before an administrative tribunal."). Because the Department desires to impose an administrative fine against Bresnahan, this proceeding is penal in nature; thus, the applicable standard of proof requires that the allegations be established by clear and convincing evidence. See, e.g., Department of Banking and
Finance, Div. of Securities and Investor Protection v. Osborne Stern & Co., 670 So. 2d 932, 935 (Fla. 1996).
Regarding the standard of proof, in Slomowitz v.
Walker, 429 So. 2d 797, 800 (Fla. 4th DCA 1983), the Court of
Appeal, Fourth District, canvassed the cases to develop a "workable definition of clear and convincing evidence" and found that of necessity such a definition would need to contain "both qualitative and quantitative standards." The court held that:
clear and convincing evidence requires that the evidence must be found to be credible; the facts to which the witnesses testify must be distinctly remembered; the testimony must be precise and explicit and the witnesses must be lacking in confusion as to the facts in issue. The evidence must be of such weight that it produces in the mind of the trier of fact a firm belief or conviction, without hesitancy, as to the truth of the allegations sought to be established.
Id. The Florida Supreme Court later adopted the fourth district's description of the clear and convincing evidence standard of proof. Inquiry Concerning a Judge No. 93-62, 645 So. 2d 398, 404 (Fla. 1994). The First District Court of Appeal also has followed the Slomowitz test, adding the interpretive comment that "[a]lthough this standard of proof may be met where the evidence is in conflict, . . . it seems to preclude evidence that is ambiguous." Westinghouse Elec. Corp., Inc. v. Shuler Bros., Inc., 590 So. 2d 986, 988 (Fla. 1st DCA 1991), rev.
denied, 599 So. 2d 1279 (Fla. 1992)(citation omitted).
In the first of the two counts that were brought against Bresnahan, the Department charged that Bresnahan had practiced contracting without a license in violation of Section
489.127, Florida Statutes, which provides in pertinent part as follows:
No person shall:
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(f) Engage in the business or act in the capacity of a contractor or advertise himself or herself or a business organization as available to engage in the business or act in the capacity of a contractor without being duly registered or certified or having a certificate of authority[.]
As used in the foregoing statute, the term "contractor" means, in relevant part:
the person who, for compensation, undertakes to, submits a bid to, or does himself or herself or by others construct, repair, alter, remodel, add to, demolish, subtract from, or improve any building or structure, including related improvements to real estate, for others or for resale to others; and whose job scope is substantially similar to the job scope described in one of the subsequent paragraphs of this subsection.
§ 489.105(3), Fla. Stat. Subsection (3) includes the following paragraphs, which, respectively, describe specific categories of contracting services:
"General contractor" means a contractor whose services are unlimited as to the type of work which he or she may do, who may contract for any activity requiring licensure under this part, and who may perform any work requiring licensure under this part, except as otherwise expressly provided in s. 489.113.
"Building contractor" means a contractor whose services are limited to construction of commercial buildings and single-dwelling or multiple-dwelling residential buildings, which commercial or residential buildings do not exceed three stories in height, and accessory use structures in connection therewith or a contractor whose services are limited to remodeling, repair, or improvement of any size building if the services do not affect the structural members of the building.
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(m) "Plumbing contractor" means a contractor whose contracting business consists of the execution of contracts requiring the experience, financial means, knowledge, and skill to install, maintain, repair, alter, extend, or, when not prohibited by law, design plumbing. A plumbing contractor may install, maintain, repair, alter, extend, or, when not prohibited by law, design the following without obtaining any additional local regulatory license, certificate, or registration: sanitary drainage or storm drainage facilities; venting systems; public or private water supply systems; septic tanks; drainage and supply wells; swimming pool piping; irrigation systems; or solar heating water systems and all appurtenances, apparatus, or equipment used in connection therewith, including boilers and pressure process piping and including the installation of water, natural gas, liquefied petroleum gas and related venting, and storm and sanitary sewer lines; and water and sewer plants and substations.
The scope of work of the plumbing contractor also includes the design, when not prohibited by law, and installation, maintenance, repair, alteration, or extension of air-piping, vacuum line piping, oxygen line piping, nitrous oxide piping, and all related medical gas systems; fire
line standpipes and fire sprinklers to the extent authorized by law; ink and chemical lines; fuel oil and gasoline piping and tank and pump installation, except bulk storage plants; and pneumatic control piping systems, all in such a manner as to comply with all plans, specifications, codes, laws, and regulations applicable. The scope of work of the plumbing contractor shall apply to private property and public property, shall include any excavation work incidental thereto, and shall include the work of the specialty plumbing contractor. Such contractor shall subcontract, with a qualified contractor in the field concerned, all other work incidental to the work but which is specified herein as being the work of a trade other than that of a plumbing contractor.
Section 489.105(6), Florida Statutes, defines the term "contracting" as follows:
"Contracting" means, except as exempted in this part, engaging in business as a contractor and includes, but is not limited to, performance of any of the acts as set forth in [s. 489.105](3) which define types of contractors. The attempted sale of contracting services and the negotiation or bid for a contract on these services also constitutes contracting. If the services offered require licensure or agent qualification, the offering, negotiation for a bid, or attempted sale of these services requires the corresponding licensure.
However, the term "contracting" shall not extend to an individual, partnership, corporation, trust, or other legal entity that offers to sell or sells completed residences on property on which the individual or business entity has any legal or equitable interest, or to the individual or business entity that offers to sell or sells manufactured or factory-built buildings that will be completed on site on
property on which either party to a contract has any legal or equitable interest, if the services of a qualified contractor certified or registered pursuant to the requirements of this chapter have been or will be retained for the purpose of constructing or completing such residences.
The undersigned has determined, as a matter of ultimate fact, that the Department established Bresnahan's guilt, by clear and convincing evidence, in connection with the charge of engaging in the practice of contracting without a license in violation of Section 489.127(1)(f), Florida Statutes. In making this determination, the undersigned concluded that the plain language of the applicable statutes, being clear and unambiguous, could be applied in a straightforward manner to the historical events at hand without resorting to principles of interpretation. It is therefore unnecessary to make additional legal conclusions concerning this violation.
Unlicensed contracting is punishable by fine pursuant to Section 489.13, Florida Statutes, which provides in relevant part as follows:
(1) Any person performing an activity requiring licensure under this part as a construction contractor is guilty of unlicensed contracting if he or she does not hold a valid active certificate or registration authorizing him or her to perform such activity, regardless of whether he or she holds a local construction contractor license or local certificate of competency. Persons working outside the geographical scope of their registration are
guilty of unlicensed activity for purposes of this part.
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(3) Notwithstanding s. 455.228, the department may impose an administrative fine of up to $10,000 on any unlicensed person guilty of unlicensed contracting. In addition, the department may assess reasonable investigative and legal costs for prosecution of the violation against the unlicensed contractor. The department may waive up to one-half of any fine imposed if the unlicensed contractor complies with certification or registration within 1 year after imposition of the fine under this subsection.
In addition, the Department is authorized to impose other penalties for this particular offense, including a separate administrative fine "not to exceed $5,000 per incident pursuant to the provisions of chapter 120 . . . ." § 455.228(1), Fla.
Stat.
In the second count against Bresnahan, the Department charged that he had practiced electrical contracting without a license, in violation of Section 489.531(1)(a), Fla. Stat. The following definitions, set forth in Section 489.505, Florida Statutes, are relevant to this charge:
(9) "Contracting" means, except where exempted in this part, engaging in business as a contractor or performing electrical or alarm work for compensation and includes, but is not limited to, performance of any of the acts found in subsections (2) and (12), which define the services which a contractor is allowed to perform. The attempted sale
of contracting services and the negotiation or bid for a contract on these services also constitutes contracting. If the services offered require licensure or agent qualification, the offering, negotiation for a bid, or attempted sale of these services requires the corresponding licensure.
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(12) "Electrical contractor" or "unlimited electrical contractor" means a person who conducts business in the electrical trade field and who has the experience, knowledge, and skill to install, repair, alter, add to, or design, in compliance with law, electrical wiring, fixtures, appliances, apparatus, raceways, conduit, or any part thereof, which generates, transmits, transforms, or utilizes electrical energy in any form, including the electrical installations and systems within plants and substations, all in compliance with applicable plans, specifications, codes, laws, and regulations. The term means any person, firm, or corporation that engages in the business of electrical contracting under an express or implied contract; or that undertakes, offers to undertake, purports to have the capacity to undertake, or submits a bid to engage in the business of electrical contracting; or that does itself or by or through others engage in the business of electrical contracting.
The undersigned has determined, as a matter of ultimate fact, that the Department proved the charge of practicing electrical contracting without a license, by clear and convincing evidence. This finding was based on the plain language of Sections 489.531(1)(a) and 489.505(9), (12), Florida
Statutes. No additional legal conclusions with regard to this charge are necessary.
The penalties for unlicensed electrical contracting are prescribed in Section 455.228(1), Florida Statutes, which provides as follows:
When the department has probable cause to believe that any person not licensed by the department, or the appropriate regulatory board within the department, has violated any provision of this chapter or any statute that relates to the practice of a profession regulated by the department, or any rule adopted pursuant thereto, the department may issue and deliver to such person a notice to cease and desist from such violation. In addition, the department may issue and deliver a notice to cease and desist to any person who aids and abets the unlicensed practice of a profession by employing such unlicensed person. The issuance of a notice to cease and desist shall not constitute agency action for which a hearing under ss.
120.569 and 120.57 may be sought. For the purpose of enforcing a cease and desist order, the department may file a proceeding in the name of the state seeking issuance of an injunction or a writ of mandamus against any person who violates any provisions of such order. In addition to the foregoing remedies, the department may impose an administrative penalty not to exceed $5,000 per incident pursuant to the provisions of chapter 120 or may issue a citation pursuant to the provisions of subsection (3). If the department is required to seek enforcement of the order for a penalty pursuant to s. 120.569, it shall be entitled to collect its attorney's fees and costs, together with any cost of collection.
25. The Department is seeking to impose a fine of $10,000 and to assess investigative costs in the amount of $209.55. Such penalties are reasonable, justified by the evidence, and within the Department's authority to administer.
Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order which: (1) finds Bresnahan guilty of (a) engaging in the business of contracting without a license and (b) practicing electrical contracting without a license; (2) imposes an administrative fine of $10,000 for these incidents of unlicensed contracting; and (3) assesses investigative costs in the amount of $209.55.
DONE AND ENTERED this 12th day of September, 2008, in Tallahassee, Leon County, Florida.
JOHN G. VAN LANINGHAM
Filed with the Clerk of the Division of Administrative Hearings this 12th day of September, 2008.
G.W. Harrell, Executive Director Construction Industry Licensing Board Department of Business and
Nancy S. Terrel, Hearing Officer Department of Business and
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.
