STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA REAL ESTATE COMMISSION, ) CORNELIUS L. REAGAN, )

)

Petitioner, )

)

vs. ) Case NO. 76-2139

)

EDWARD V. NORITIS, )

)

Respondent. )

)

RECOMMENDED ORDER

A hearing was held in the above-captioned matter, after due notice, at Ft.

Lauderdale, Florida, on May 2, 1977, before the undersigned Hearing Officer.

APPEARANCES

For Petitioner: Bruce Kamelhair, Esquire

Florida Real Estate Commission 2699 Lee Road

Winter Park, Florida 32789

For Respondent: Bruno Di Giulian and

John B. Di Chiara, Esquires Suite 1500, One Financial Plaza Ft. Lauderdale, Florida 33394

ISSUE PRESENTED

Whether Respondent's registration as a real estate salesman should be suspended or revoked, pursuant to Section 475.25, Florida Statutes. At the hearing, respondent moved to dismiss certain portions of petitioner's second amended administrative complaint on various grounds. Ruling on the motion was reserved and it will be considered in Conclusions of Law herein.

At the conclusion of petitioner's case, respondent's motion for a directed verdict was denied.

FINDINGS OF FACT

1. On October 12, 1973, respondent filed application with the petitioner for registration as a real estate salesman. Question 9 on the form application as completed by respondent reads as follows:

   
   

   "9. Have you ever been arrested for, or charged with, the commission of an offense against the laws of municipality, state or nation, including traffic offenses, without regard to whether sentence has been passed or served, or whether the verdict or judgment

   has been reversed or set aside or not, or pardon or parole granted

   
   

   If yes, state details in full Minor traffic tickets-No court involved." Thereafter, on March 15, 1974, respondent was issued certificate No. 0126461 as a registered real estate salesman in Ft. Lauderdale, Florida. The registration was renewed on April 1, 1975, with expiration date of March 31, 1977. (Petitioner's Composite Exhibit No. 1)

   
   

2. On June 22, 1959, respondent was arrested by federal authorities in Miami, Florida, pursuant to a warrant issued by the U.S. District Court of the Middle District of North Carolina upon an indictment charging him with failure to file income tax returns in violation of Title 26, U.S. Code, Section 7203. Respondent pleaded guilty to the offense and, on February 19, 1960, was sentenced to pay a fine of $2,000 and to be confined for a period of one year. The execution of the prison sentence was suspended and respondent was placed on probation for a period of three years subject to payment of the fine and delinquent income tax. (Petitioner's Exhibit 2)

   
   

3. On August 13, 1974, the United States Attorney, United States District Court for the Southern District of Florida, filed an information against respondent charging him with willfully filing a fraudulent and false document as to a material matter in an application for enrollment to practice before the Internal Revenue Service, in violation of Title 26, United States Code, Section 7207. On August 27, 1974, respondent pleaded guilty to the offense and was sentenced to pay a fine of $250.00 The offense of which respondent was convicted was based on a negative answer to a question on the application which was similar to question 9 on the application for registration as a real estate salesman. (Petitioner's Exhibit 3, Testimony of Respondent)

   
   

4. Respondent testified in denial of any intention to mislead or deceive petitioner as to the fact of his federal conviction in 1960. It was his opinion, based on advice of counsel representing him during those proceedings, that the conviction would be "wiped out" or otherwise expunged from the records in a period of ten years. Accordingly, when his wife was filling out the real estate application for him and inquired about an answer to question 9, respondent told her not to list the arrest and conviction since it has been "wiped out." Petitioner states that he did not read his application before signing and submitting it to petitioner because he relied upon his wife who customarily prepared such documents for him. Petitioner's explanation for his failure to fully answer question 9 of the application is not deemed credible and is insufficiently supported by other evidence. (Testimony of respondent, Sheila Noritis)

   
   

5. Petitioner is a competent and efficient accountant and real estate salesman who enjoys a good reputation for truth and honesty in his community. (Testimony of Stratton, Francis, M. Hartigan, J. Hartigan, Langberg, Deschamps, Cubbison, Mullenski, McTaggart; supplemented by respondent's Exhibits 2-4)

   
   

6. Respondent sought to introduce into evidence the results of a voluntary polygraph examination to show that in the opinion of the polygraph examiner, respondent was being truthful in his answers to questions bearing on his honest belief that the federal conviction had been "wiped out." Petitioner's objection to the receipt of such evidence was sustained. (Respondent's Exhibit 1 for identification [rejected]).

   CONCLUSIONS OF LAW

   
   

7. In its complaint, petitioner seeks to revoke respondent's registration as a real estate salesman. Count 1 of the complaint alleges that by reason of his false answer to question 9 of his application for registration, by failing to reveal his arrest in 1959, he does not possess the "necessary qualifications of honesty, truthfulness, trustworthiness and good character" as required by subsection 475.17(1), Florida Statutes, and is guilty of obtaining his registration as a salesman by means of fraud, misrepresentation, and concealment in violation of subsection 475.25(2), Florida Statutes. The latter provision provides for revocation of registration "if such registration, or a certificate issued thereon, is found to have been obtained by the registrant by means of fraud, misrepresentation, or concealment." Although respondent maintained in his motion to dismiss that the allegations concerning his qualifications for registration under 475.17(1) deal only with the issuance of licenses and not the revocation thereof, his contention is not well taken. The statutory revocation provision hinges on an applicant obtaining his registration through either fraud, misrepresentation or concealment. Assuming that one of such methods is found to exist, it must then be determined if the applicant's act or omission resulted in securing a license to which he might not otherwise have been entitled. Consequently, it is necessary to look to the standards for license issuance in order to determine if grounds for revocation exist.

   
   

8. Here, the method by which petitioner sought to obtain his license was concealment of a material fact; i.e., the omission of his 1969 federal arrest on question 9 of the application. Such a concealment, to fall within the ambit of the statute, must be intentional and with a design to suppress the truth from the body that determines qualifications for licensing. No question arises in this case that the omission was inadvertent due to mere forgetfulness on respondent's part. He admitted considering whether to list the arrest on his application and decided not to do so because of his alleged belief that the matter had been removed from the records by the passage of time. However, insufficient evidence was presented to bolster his testimony in this regard. Absent stipulation of the parties, the results of a polygraph examination are inadmissible in evidence. Kaminski v. State, 63 So 2d 339 (Fla 1952), State V. Cunningham, 324 So 2d 173 (Fla. 3d DCA 1975). It is considered that this doctrine applies to administrative as well as judicial proceeding. See The Florida Bar v. Rayman & Duhig, 238 So 2d 594 (Fla. 1970). Respondent asserts that it would have been foolish to have omitted the arrest from his application if he had not believed it to have been expunged because he was aware of the fact that petitioner would investigate his prior record and thereby learn the details of the same. However, he just as well could have been believed that the staleness of the incident would result in it not being disclosed by investigation. It is noteworthy that the application form signed and sworn to by the respondent is replete with admonitions to read the questions therein and answer them fully and accurately with no evasion and, in fact, the application is headed by a note that question 9 should be answered "very carefully." Since respondent's explanation is not given credence even when considered in the light of the character evidence adduced in his behalf, it is determined that he practiced concealment within the meaning of the statute.

   
   

9. In determining whether respondent's concealment resulted in his obtaining the license in question, the following parts of subsection 475.17(1) are pertinent:

"475.17 Qualifications of applicants for registration.(1) An applicant for

registration . shall be required to make it appear that he is... honest, truthful, trustworthy, of good character, and that

he bears a good reputation for fair dealing . If it shall be made to appear . . . that the applicant has been guilty of conduct or practices in this state or elsewhere, which would have been grounds for revoking or suspending registration under this chapter had the applicant then been registered, the

applicant shall be deemed not to be qualified, unless, because of lapse of time and subsequent good conduct and reputation or other reason deemed sufficient it shall appear to the commission that the interest of the public and investors will not likely be endangered by the granting of registration . . (Emphasis added)

It thus is necessary to look to the suspension and revocation authority in Chapter 475 to determine whether the 1960 conviction would have been grounds for disciplinary action against respondent if he had been licensed prior to same.

The offense of which he was convicted was a misdemeanor under the U.S. Internal Revenue Code (26 U.S.C. 7203) for willful failure to file tax returns. Section 475.25(1)(e) is the only apparent applicable disciplinary provision. It provides in part that the registration of a registrant may be suspended if he has:

"(e) Been guilty of a crime against the laws of this state or any other state or of the United States involving moral turpitude, or fraudulent or dishonest dealing

It is considered that fraudulent or dishonest dealing is not involved in the federal offense because no "dealing" or business transaction was involved. It therefore must be determined if the offense is one involving moral turpitude.

It has been held generally that that term means an act of baseness, vileness, or depravity in the private and social duties which a man owes to his fellow man or to society in general, contrary to the accepted and customary rule of right and duty between man and man. The question of moral turpitude is normally determined from a consideration of the nature of the offense and the attendant circumstances. In income tax evasion cases, the courts have been divided on whether or not moral turpitude is involved. However, where the conviction does not establish moral turpitude on its face, some independent showing beyond the bare fact of conviction is required. 7 Am Jur 2d, Attorneys, 50-51, 63 ALR 3rd

476. Here there was no evidence that respondent intended to defraud the government or otherwise engage in fraudulent conduct. It is therefore considered that his crime of failing to file tax returns cannot be characterized as one involving moral turpitude. It is further concluded that no grounds exist for revocation of his registration.

1. In Count 2 of the complaint, petitioner alleges that respondent violated subsection 475.25(1)(e) by his 1974 federal conviction for willful filing of a false and fraudulent document in connection with his application to practice before the Internal Revenue Service in violation of Title 26, U.S.C., Section 7207. Again, this offense does not involve any "dealing" or other business' transaction. It therefore must be found that moral turpitude is involved in the offense to invoke subsection 475.25(1)(e), as a ground for

   discipline. Section 7207, by its wording, specifically involves willfully and knowingly submitting false or fraudulent statements as to any material matter, and therefore clearly involves an intent to defraud. It does involve moral turpitude in the sense of subsection 475.25(1)(e). The conviction having been established by a properly authenticated record thereof, prima facie evidence of guilt was established. The fact that petitioner did not specifically refer to moral turpitude as a basis for alleging a violation of subsection 475.25(1)(e) does not foreclose a conclusion that respondent violated the statute in that respect. It is sufficient that a charge of improper conduct under the statutory provision in question is stated. Thorn v. Florida Real Estate Commission, 146 So 2d 907 (Fla. 2d DCA 1962) In view of the foregoing, petitioner is authorized to impose disciplinary sanctions.

   
   

2. In assessing an appropriate penalty, respondent's exemplary conduct since the 1974 conviction must be taken into account. Testimony of character witnesses establishes that his activities as a real estate salesman have been above reproach and it therefore appears unlikely that the interests of the public would be endangered by permitting him to remain as an active salesman. For this reason, it is considered that although respondent's registration certificate should be suspended for a period of sixty (60) days, the enforcement thereof shall be held in abeyance for a like period, after which respondent's status as a registered real estate salesman should be fully restored in the absence of further misconduct.

RECOMMENDATION

It is recommended that respondent's registration as a real estate salesman be suspended for a period of sixty (60) days, but that the enforcement thereof be held in abeyance for a like period.

DONE and ENTERED this 16th day of May, 1977, in Tallahassee, Florida.

THOMAS C. OLDHAM

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

(904) 488-9675

COPIES FURNISHED:

Bruce Kamelhair, Esquire Florida Real Estate Commission 2699 Lee Road

Winter Park, Florida 32789

Bruno Di Giulian and

John B. Di Chiara, Esquire Suite 1500, One Financial Plaza Ft. Lauderdale, Florida 33394

Docket for Case No: 76-002139

Orders for Case No: 76-002139