STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA CONSTRUCTION INDUSTRY ) LICENSING BOARD, )

)

Petitioner, )

)

vs. ) CASE NO. 76-835

)

KARL A. KANDELL, ) d/b/a KANDELL CONSTRUCTION CORP.,)

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, James E. Bradwell, held a public hearing in the above styled cause on November 3, 1976, at West Palm Beach, Florida.

APPEARANCES

For Petitioner: Barry Sinoff, Esquire

1010 Blackstone Building

Jacksonville, Florida 32202

For Respondent: Robert L. Saylor, Esquire

Suite 222, Squires Building 721 U.S. Highway One

North Palm Beach, Florida 33408

By administrative complaint filed April 6, 1976, the Florida Construction industry Licensing Board (FCILB) Petitioner herein, seeks to suspend the certified general contractor's license of Karl A. Kandell d/b/a Kandell Construction Corporation (license No. CGC002481). As grounds therefor, it is alleged that Kandell Construction Corporation was adjudged bankrupt by the U.S. District Court for the Southern District of Florida on January 26, 1976. By this act, it is alleged that the licensee is in violation of Section 468.112(7), Florida Statutes and that the licensee's filing of the petition in bankruptcy is considered by the Board to be just cause for suspension of his certification.

One exhibit was introduced and admitted into evidence and the Respondent testified in his behalf.

FCILB, through its attorney, introduced an order adjudging Kandell Construction Corporation, a Florida corporation, bankrupt on January 26, 1976. (Petitioner's Exhibit #1)

The thrust of the Respondent's argument is that Florida Statutes, Section 468.112(7) is invalid and violative of the supremacy clause of the United States Constitution in that said state statute interferes with and frustrates a federal statute and the United States Constitution (Article 6 Clause 2 of the United States Constitution and Section 17 of the Bankruptcy Act, 11 U.S.C. Section 35).

Respondent avers that since the main purpose of the Bankruptcy Act is to give debtors a new opportunity and a clear field for future efforts by eliminating preexisting debts, the state statute in question frustrates that policy since it authorizes disciplinary action against the licensed contractor for securing an adjudication in bankruptcy. By so doing, Respondent urges that the state statute offends the purpose of congress since its effect is to deny to debtors the benefits of the Bankruptcy Act.

In Perez v. Campbell 402 US 637, 652, 915. Ct. 1704, the United States Supreme Court struck down a state statute providing that a discharge in bankruptcy did not exonerate a judgement debtor from the requirements of state law in respect to the financial responsibility of motorists. The state law involved authorized the suspension of a driver's license and vehicle registration for nonpayment of a judgement debt attributable to an automobile accident. Under the provisions of the challenged statute, until the judgement was paid the suspension remained in effect and the judgement debtor continued under its restraint despite the fact that the debt might later be discharged in bankruptcy. The Perez court carefully delineated the issue presented and explicated the principals for its resolution. After analyzing in a two step process the construction of the two statutes and after determining the constitutional question whether they are in conflict, the Supreme Court concluded that the state statute could not stand because of the apparent conflict between state and federal law. In reaching this conclusion the Perez opinion made clear that the controlling principal is whether a state statute interferes with and frustrates a federal statute and not merely whether the form is designed for some conceivable state purpose.

Karl A. Kandell, a contractor and land developer, testified that he is presently residing in Marietta, Georgia where he is currently employed as a contractor and land developer. He testified that his license has been placed in inactive status however, he is able to obtain permits etc. in the state of Georgia based on his representation to the Georgia licensing authorities that he is a registered general contractor in Florida. Therefore he urges that if his registration is suspended in this state, he will face an undue hardship inasmuch as he will be unable to obtain licensing and permits for projects that he is building and developing in Georgia.

The undersigned found no judicial decisions addressing the constitutionality of the challenged statute nor did counsel for the parties. The undersigned is mindful of the authority vested in a Hearing Officer in determining disputes cognizable under the Administrative Procedure Act, and the general restraints of administrative agencies based on the separation of powers

doctrine. See for example State v. Calwell 23 So.2d 855. The undersigned feels compelled and duty bound to consider the controlling principles and be guided by the pertinent state statute until or if they have been struck down as unconstitutional. While it appears that Congress, in enacting the Bankruptcy Act enunciated a policy of giving discharge debtors a new start, it is also clear that the state statute here complained has not been repealed by any court of competent jurisdiction.

CONCLUSIONS OF LAW

1. The parties were properly noticed pursuant to Chapter 120, Florida Statutes.

   
   

2. The Respondent, Karl A. Kandell, is a certified general contractor who holds license no. CGC002481.

3. Kandell Construction Corporation was adjudged bankrupt by the U. S. District Court for the Southern District of Florida on January 26, 1976.

   
   

4. Chapter 468.112(7), Florida Statutes, provides that the Florida Construction Industry Licensing Board may consider as just cause for suspension of a certification, the filing of a petition in bankruptcy.

RECOMMENDATION

Based on the above findings and conclusions of law, I recommend that the Respondent Licensee's certification be suspended for one year.

DONE and ORDERED this 22nd day of December, 1976, in Tallahassee, Florida.

JAMES E. BRADWELL

Hearing Officer

Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304

(904) 488-9675

COPIES FURNISHED:

Barry Sinoff, Esquire 1010 Blackstone Building

Jacksonville, Florida 32202

Robert L. Saylor, Esquire Suite 222, Squires Building 721 U.S. Highway One

North Palm Beach, Florida 33408

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

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

July 15, 1977

Mr. Karl A. Kandell

Suite 160, 380 Interstate North

Atlanta, Georgia 30339

Dear Mr. Kandell:

At a formal hearing held in West Palm Beach, Florida on November 3, 1976, by the Division of Administrative Hearings, it was found that you had been adjudged bankrupt, which under F.S. 468.112(7) the Florida Construction Industry

Licensing Board may consider as just cause for suspension of a certification, the filing of a petition of Bankruptcy. The Hearing Officer recommended suspension for one year.

On July 8, 1977, the Florida Construction Industry Licensing Board's monthly meeting, after reviewing evidence of your financial responsibility, it was voted to dismiss you case; therefore your license remains in full force and effect.

Sincerely,

THE FLORIDA CONSTRUCTION INDUSTRY LICENSING BOARD

JKL:ed

cc: Barry Sinoff, Esquire 1010 Blackstone Building

J. K. Linnan Executive Director

Jacksonville, Florida 32202

Robert L. Saylor, Esquire Suite 222, Squires Building 721 U.S. Highway One

North Palm Beach, Florida 33408

Docket for Case No: 76-000835

Orders for Case No: 76-000835