STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DIVISION OF BEVERAGE, )

)

Petitioner, )

)

vs. ) CASE NO. 75-1627

) LICENSE NO. 23-951 EUGENE CONEY d/b/a 62nd STREET )

GROCERY, )

)

Respondent. )

)

RECOMMENDED ORDER

A hearing was held pursuant to notice in the Miami District Office of the Department of Business Regulation, 7880 N.W. 36th Street, Miami, Florida at 11:00 a.m. on January 12, 1976, before Stephen F. Dean assigned Hearing Officer of the Division of Administrative Hearings.

This matter was presented upon the Administrative Complaint and notice of the Petitioner, Division of Beverage, alleging that the Respondent, Eugene Coney d/b/a 62nd Street Grocery, was in violation of Section 561.23(2), 561.17 and 562.45, Florida Statutes, and 7A-4.45 and 7A-3.17, Florida Administrative Code, by having failed to keep wine and malt beverage invoices on the premises for three (3) years, failing to display the beverage license in a conspicuous place within the licensed premises, by failing to disclose the name of a person who had a direct or indirect interest in the business on the application for licensure, by filing a false lease affidavit with the application for licensure dated October 4, 1973 and by failing to maintain responsibility for all business conducted on your premises contrary to Rule 7A-3.17, F.A.C. The charge contained in paragraph 1 of the Complaint relating to Rule.7A-3.11, F.A.C., was dismissed by the agency.

APPEARANCES

For Petitioner: Charles Curtis, Esquire Witnesses: James J. Harris, Jr.

James R. Bates Edward Pfitzenmaier

For Respondent: Barnett Pletz, Esquire Witness: Eugene Coney

Robert Coney

FINDINGS OF FACT

1. It was stipulated that Respondent, Eugene Coney, is a licensee, and that he received due notice of said hearing. It was also stipulated that Robert Coney conducted 90 percent of the business activities of the business, writing checks, paying bills, and similar functions.

   
   

2. Exhibits 1-6 were identified by James A. Harris, Jr., custodian of the Miami District Office Records, and were received into evidence. Beverage Agent James R. Bates testified that on May 8, 1974, he inspected the premises at 9:30 p.m. Robert Coney was present on the premises. Then asked to produce the beverage license, Robert Coney searched under the counter and produced the license. When asked to produce invoices for the sale of wine and malt beverages, Robert Coney produced those for that day but could not produce such invoices for the past six (6) months or for the past three (3) years. Bates did discover an old eviction notice and various other bills. In response to Bates' questions Robert Coney stated that he handled most of the business. Bates testified, and it was confirmed by the Coneys, that permission to keep invoices of wine and malt beverage sales off of the premises had not been requested. A copy of an eviction notice from the Court files was received as Exhibit 7.

   
   

3. Beverage Agent Edward Pfitzenmaier inspected the licensed premises on April 9, 1975 and found the premises in the charge of Geneva Bell. Pfitzenmaier asked to see the beverage license and again it was found under the counter of the grocery.

   
   

4. Robert Coney stated be was the brother of Eugene Coney, the licensee, and was employed at his brother's licensed premises as the manager. His duties included paying bills, clerking, protecting the business property, receiving beverages, selling

   beverages, and accounting for the business receipts. He had no written contract with his brother but it was their oral agreement that he could take food from the store's stocks and that the profits would split evenly between them. In addition, according to Eugene Coney, if Robert Coney required more than 50 percent of the profits to support his needs he was authorized to take so much of the profits as he required to support his basic needs. Robert and Eugene Coney both stated that Eugene had opened the business, had executed the lease with the landlord, and was in the premises at least every 7-8 days. Eugene Coney did relieve his brother when he was sick or as necessary, however, Eugene Coney had a full time job as a truck driver which required him to be out of town for several days at the time.

   
   

5. Eugene testified that he had opened the business to provide his brother with employment because of Robert's heart condition, but that he (Eugene) was the owner, had absolutely final say in the conduct of the business, and could discharge Robert at any time. Eugene stated, however, that Robert was manager and could run the business as he wanted to run it.

   
   

6. Both brothers testified that the store had been burglarized and vandalized on many occasions and that this had resulted in the destruction of many business records to include wine and malt beverage invoices. Similarly, their beverage license had been destroyed or disfigured during these burglaries which is why it was not displayed. Robert testified that after the inspection by Bates, he had found a box of business records which he had forgotten about which included some of the invoices in question. The Hearing Officer requested that the Petitioner's agents inspect these records and advise the Hearing Officer of the results of their inspection by affidavit which would be received as a late filed exhibit. Said affidavit is made a part of the record.

   
   

   CONCLUSIONS OF LAW

   
   

7. Section 561.23(2), F.S. clearly provides that licensees shall display their beverage license in a conspicuous place. The fact that the licensed premises had been vandalized is certainly evidence in mitigation on one occasion, however, this failure to display the license was for a substantial period of time. The Hearing Officer was advised that duplicates of the license, if disfigured or destroyed, could be obtained from the Miami District Office. Having considered the facts presented by the agency, the evidence in mitigation to include the fact the license was

   presented in each instance, the Hearing Officer finds that Respondent's in violation of Section 561.23(2), F.S.

   
   

8. The Hearing Officer finds that the evidence indicates that the licensee did maintain those invoices of sales of wine and malt beverages which were in their possession. The licensee cannot be required to maintain invoices which have been destroyed by vandals. The Hearing Officer does not find the licensee in violation of Rule 7A-4.45, F.A.C.

   
   

9. Regarding the allegations of paragraph 4 of the Complaint, it is alleged that Eugene failed to disclose the direct or indirect interest of Robert in the business. The Division of Beverage introduced evidence of Robert's management and the brother's compensation agreement to prove Robert's indirect, if not direct, interest in the business.

   
   

10. In the case of Wilkenfeld v. Meiklejohn, 216 So.2d 237, (1 DCA 1968), the Court considering Section 561.17(1), stated as follows the nature of the interest required to be disclosed:

    
    

    "No cases have been called to our attention construing the nature of the interest of a business which one must have to come within the statute under consideration, but we take it to mean a pecuniary interest. (p.239)"

    
    

11. The Division of Beverage suggests that the sharing of profits shows such a pecuniary or financial interest in the business. While sharing of profits could be evidence of shared ownership, the brothers' testimony, which was very candid, was that Robert had no financial interest in the business. The profit sharing arrangement was explained to be the agreed upon means of compensating Robert for his management and labors in behalf of the business. The Division produced no direct evidence that Robert had infused any money into the business. Profit sharing per se does not constitute an indirect financial interest of the type required to be reported. In this instance, the consideration for sharing the profits was sufficiently explained by Eugene.

    
    

12. The Division has also alleged that Eugene has violated Rule 7A-3.17, F.A.C., by failing to manage and control all business conducted on the premises under the beverage law directly or through his authorized employee(s).

    
    

13. Rule 7A-3.17, F.A.C., attempts to clarify who would be an authorized employee. The rule indicates that such an employee

    is one who receives a salary or wages for services performed on behalf of the licensee and who is under the exclusive control and direction of the licensee.

    
    

14. The Division argues that the requirement relating to wages or salary means fixed wages or salary. While salary may be appropriately interpreted as fixed periodical compensation, the rule refers to both salary and wages. Wages is therefore interpreted by the Hearing Officer to encompass a broader scope of compensation as defined in Blacks Law Dictionary, Revised Fourth Edition, which states:

    
    

    "Wages. Compensation given to a hired parson for his or her service; the compensation agreed upon by a master to be paid to a servant... Every form of remunerative payable for a given period to an

    individual for personal services, including salaries, commissions, vacation pay, dismissal wages, bonuses, and reasonable value of board, rent, housing, lodging, payments of any kind, tips, and any other similar advantage received from one's employer or directly with respect to work for him."

    
    

15. Such a definition of wages does not require fixed compensation. Further, the manner of compensation is not considered dispositive of the mature of the relationship existing between an employer and another. 53 Am Jur 2d, Masters and Servant s. 2, Note 19. The rule does, however, speak to particular financial relationships which are prohibited. The "employee" may not lease the premises from the licensee. The "employee" may not pay a fixed sum to the licensee. Neither of these financial arrangements was demonstrated.

    
    

16. Additionally, Rule 7A-3.17, F.A.C., specifically prohibits the following business relationships between the licensee and another person: an independent contractor, a lessee, or a person employed by a collateral agreement to independently manage and control the licensed premises. However, the rule indicates that a principal and agent relationship between the employee and licensee is permitted. Based upon the rule's stated provisions, it is clear that control of the licensed premises, activities within the premises, and the conduct of that portion of the business regulated under the beverage laws is the basic requirement of the rule.

    
    

17. In the agent-principal relationship, the agent may conduct business and even contract in the principal's behalf,

    whereas a person who is strictly an employee or servant may not.

    53 Am Jur 2d, Masters and Servant, s. 3. Rule 7A-3.17, F.A.C., indicates that the beverages may be purchased in the licensee's behalf and the premises operated in the name of the licensee thereby approving a principal-agent relationship. If control over the conduct of the person, the order, method, and plan of work is retained, the relationship is not that of an employer-independent contractor. If the person in question is free to execute the work without being subject to the orders of the employer with regard to such details as the method, plan, and order of work, then the person is an independent contractor. Again, the mode of payment may be considered, it is not decisive of the question. 53 Am Jur 2d, Masters and Servant s. 4.

    
    

18. With regard to the relationship in question, Eugene testified that he had authorized Robert to run the grocery in the way he (Robert) wanted to run it. Therefore, regardless of the degree of ultimate responsibility residing in Eugene or the manner in which Robert was compensated, Robert was free to conduct the details of the business. Therefore, Robert was an independent contractor, and Eugene was in violation of the rule.

    
    

19. Regarding the allegation of having filed a false lease affidavit, the only evidence introduced to support this contention was the eviction judgement. The Hearing Officer notes that this judgement was a default type of judgement. This judgement could perhaps be collateral proof of the allegation but there was no direct evidence regarding the lease except the testimony of the brothers, both of whom indicated that Eugene was the lessee. The Hearing Officer finds their testimony more believable and more direct that the default judgement of eviction.

RECOMMENDATION

Having found that the charges of falsifying the lease affidavit, the failure to keep records of sales of wine and malt beverages for a period of three (3) years, the failure of the applicant to show the alleged business interest of Robert Coney in his application were not proven, the Hearing Officer recommends these charges be dropped.

Having found that the licensee failed to conspicuously display the beverage license, but having found some mitigating factors, the Hearing Officer recommends a minimal penalty of one week suspension or a civil penalty of $50.

Having found the licensee in violation of Rule 7A-3.17, F.A.C., the Hearing Officer recommends that the licensee receive a light penalty of two weeks suspension or a civil penalty of $400.

The suspensions are recommended to run consecutively. DONE and ORDERED this 4th day of February, 1976.

STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304

(904) 488-9675

COPIES FURNISHED:

Charles L. Curtis, Esquire Department of Business Regulation The Johns Building

Tallahassee, Florida

Barnett Pletz, Esquire

335 N. W. 54th Street Miami, Florida 33127

================================================================= AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA DEPARTMENT OF BUSINESS REGULATION

DIVISION OF BEVERAGE

DIVISION OF BEVERAGE,

Petitioner,

1. CASE NO. 75-1627

   LICENSE NO. 23-951

   EUGENE CONEY d/b/a 62nd STREET GROCERY,

   
   

   Respondent.

   /

   
   

   ORDER

   
   

   COMES NOW, the Director of the Division of Beverage, the Honorable Charles A. Nuzum, Department of Business Regulation, State of Florida, and after due consideration in the above styled cause, it is hereby ORDERED:

   
   

   1. That the Recommended Order of the Hearing Examiner of February 4, 1976, is hereby adopted in its entirety. A copy of that Recommended Order is attached hereto, incorporated by reference herein, and made a part hereof;

      
      

   2. For failing to display his beverage license conspicuously, the licensee is hereby assessed a civil penalty of

      $50;

      
      

   3. For having violated Rule 7A-3.17, the licensee is hereby assessed a civil penalty of $400;

      
      

   4. In lieu of the total civil penalty of $450, the licensee shall have his license suspended for a period of three weeks from the date of his election of which penalty is to be imposed;

   5. The civil penalty shall be paid within 15 days from the receipt of this order or the Respondents license will automatically be suspended for a period of three weeks.

DONE AND ORDERED this 31 day of March, 1976, in Tallahassee, Leon County, Florida.

Charles A. Nuzum, Director Division of Beverage

Department of Business Regulation State of Florida

Room 217, Johns Building Tallahassee, Florida 32304

Copies furnished to: Charles L. Curtis, Esq.

Department of Business Regulation

210 Johns Building 725 S. Bronough Street

Tallahassee, Florida 32304

Barnett Pletz, Esq.

335 N. W. 54th Street Miami, Florida 33127

Docket for Case No: 75-001627

Orders for Case No: 75-001627