STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA REAL ESTATE COMMISSION, )

)

Petitioner, )

)

vs. ) CASE NO. 78-301

)

ERIC W. ADAMS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice an administrative hearing was held before Delphene C. Strickland, State Hearing Officer, Division of Administrative Hearings on the 2nd day of June, 1978 beginning at 10:00 a.m. in the First Floor Courtroom, South Brevard Branch Courthouse, 50 Neiman Avenue, Melbourne, Florida.

APPEARANCES

For Petitioner: Kenneth Meer, Esquire

Florida Real Estate Commission

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801

For Respondent: Earl W. Adams, Appearing in Proper Person

206 Sand Dollar

North Indialantic, Florida 32903 ISSUE

Whether the license of Respondent Adams should be suspended, revoked or whether Respondent should be otherwise disciplined for a violation of Section 475.25(1)(a), Florida Statutes.

FINDINGS OF FACT

1. An administrative complaint was filed against Respondent Earl W. Adams, a registered real estate broker on July 27, 1977. Respondent holds license no. 0148042.

   
   

2. The complaint alleged:

   
   

   1. That Mildred Muranyi contacted Respondent in May, 1976, for this services to locate investment property. Respondent suggested that Mrs. Muranyi consider the motel business and specifically the Seascape Motel owned by Joseph

      J. Brex and his wife.

      
      

   2. That Respondent drafted a contract under which Mrs. Muranyi agreed to purchase the Seascape Motel; that at the insistence of Mrs. Muranyi

      Respondent Adams placed a provision in the contract relating to termite inspection; that Respondent stated that he would have the Seascape Motel inspected for termites on behalf of Mrs. Muranyi; that at Respondent's request Broker Dorothy Kincel instructed Mr. Ken Treat of Terminix Pest Control to inspect the Seascape Motel; that upon beginning the inspection, evidence of termites and termite damage was found and this information was brought to the attention of Respondent whereupon Respondent contacted Mr. Baughn Kestetter of

      R.W. Collins Pest Control and requested a termite inspection of the Seascape Motel; that Respondent instructed the pest control agent to inspect only certain units of the Motel; that thereafter Respondent requested a clearance letter from Mr. Kerstetter regarding termites and was thereupon advised that inasmuch as the inspection was incomplete, no clearance letter would be given.

      
      

   3. That on or about June 16, 1976, Respondent wrote Mrs. Muranyi and advised her that the Seascape Motel had been inspected by Collins Pest Control for termites and no evidence of any infestation was located; that in reliance upon the representations of Respondent Mrs. Muranyi, on July 12, 1976 closed the sale and purchased the Seascape Motel.

      
      

3. The Hearing Officer finds:

   
   

   The subject property, the Seascape Motel, was inspected by two termite companies, one company, Ken Treat of Terminix Pest Control began inspection and the inspector found termites present and notified the owner of the property. No Evidence was produced to show that Respondent had notice of the finding of the termites.

   
   

   A second pest control company, R.W. Collins Pest Control, was contacted but could not make a complete inspection of the property for the reason that part of the units were not available to the inspector. The inspector notified Respondent Adams that he could not write a clearance letter inasmuch as all units had not been inspected.

   
   

4. The original contract had been changed by the parties to state that the property was sold in "as is condition." A letter of June 16, 1976 from Respondent Adams to the purchaser, Mrs. Milly Muranyi gave notice that no full termite inspection had been made. The Respondent, however, appears to be less than candid inasmuch as the broker stated in part "I would do nothing, I wouldn't do anything else regarding termite inspection prior to closing . . ."

   
   

   It is inconceivable that a person with knowledge of damage that can be done by termites could in good faith state that he would close a deal for himself in which the termite damage was unknown. Mr. Adams has dealt with coastal property which is subject to termite damage and it is good business practice to determine any damage that might be done to any structure before purchased.

   
   

5. (a) Petitioner contends: that the representations and activities of the Respondent amounted to a fraud on the purchaser; that once evidence of termite damage to the property for sale was discovered by one firm the inspection was cancelled; that the inspection by the second pest control company was limited to portions of the property that were not infected by termites.

   
   

   (b) Respondent contends: that at the time the contract was signed the property was being bought in "as is condition" and that the contract shows a waiver of the termite clause and was initialled by the parties; that the purchasers were represented by a competent attorney; that the condition of the

   contract was not predicated upon "termites or not termites" and that the price of the motel had been lowered from the original asking price.

   
   

   CONCLUSIONS OF LAW

   
   

6. Section 475.25(1)(a), Florida Statutes, provides:

   
   

   475.25 Grounds for revocation or suspension.

   1. The registration of a registrant may be sus- pended for a period not exceeding 2 years, or until compliance with a lawful order imposed in the final order of suspension, or both, upon a finding of facts showing that the registrant has:

      1. Been guilty of fraud, misrepresentation, con- cealment, false promises, false pretenses, dishonest dealing, trick, scheme or device, culpable negligence, or breach of trust in any business transaction, in this state or any other state, nation, or territory; has violated a duty imposed upon him by law or by the

   terms of a listing contract, written, oral, express or implied, in a real estate transaction; has aided, as- sisted, or conspired with any other person engaged

   in any such misconduct, and has committed an overt act in furtherance of such intent, design or scheme. It shall be immaterial to the guilt of the registrant that the victim, or intended victim, of the miscon- duct has sustained no damage or loss or the damage

   or loss has been settled and paid, after discovery of the misconduct, or whether such victim, or intended victim, thereof, was a customer or a person in confi- dential relation with the registrant, or was an identi- fied member of the general public; or,

   
   

7. The Respondent did not actually violate the foregoing statute. He protected himself by the writing of the letter of June 16, 1976 prior to the subsequent closing, although it is obvious that the wording of his letter was intended to encourage the purchasers to buy the property regardless of any termite damage.

   
   

8. Section 475.04(1), Florida Statutes, provides:

   
   

   475.04 Duty of commissions to enforce this chapter, keep records and educate members of profession.

   (1) The commission may examine witnesses and administer oaths, and shall investigate persons do- ing a real estate business in this state to ascertain if they are violating any of the provisions of this chapter necessary to an orderly dispatch of business. The commission shall foster the education of real estate brokers and salesmen concerning the ethical, legal and business principles which shall govern their conduct.

   
   

9. Under the foregoing section the Commission shall foster the education of those persons doing a real estate business in this state concerning the ethical principles which should govern their conduct. It has the authority to

educate those who may be pursuing a course of conduct it considers may not be upon to the highest standards of ethical conduct. Such education may be appropriate in this case.

RECOMMENDATION

Dismiss the complaint.

DONE AND ENTERED this 11th day of September, 1978, in Tallahassee, Florida.

DELPHENE C. STRICKLAND

Hearing Officer

Division of Administrative Hearings

530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675

COPIES FURNISHED:

Kenneth Meer, Esquire

Florida Real Estate Commission

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801

Earl W. Adams

206 Sand Dollar

North Indialantic, Florida 32903

Docket for Case No: 78-000301

Orders for Case No: 78-000301