STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BERTHA MANCIL and THOMAS H. MANCIL )

d/b/a B&T PRODUCE, )

)

Petitioners, )

)

vs. ) CASE NO. 78-2432A

) EASTERN MARKETING SERVICE, INC., )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, G. Steven Pfeiffer, held a public hearing in this case on February 22, 1979, in Clewiston, Florida.

APPEARANCES

The following appearances were entered: Bertha Mancil and Thomas H. Mancil, the Petitioners, who appeared on their own behalf; W. B. Stevens, a corporate officer of the Respondent, who appeared on behalf of the Respondent; and Earl Peterson, Tallahassee, Florida, who appeared on behalf of the Department of Agriculture and Consumer Services.

On or about August 10, 1978, the Petitioners executed a complaint, and filed it with the Department of Agriculture and Consumer Services, asserting that the Respondent failed to adequately compensate the Petitioners for agricultural goods sold by the Petitioners to the Respondent. An amendment to the complaint was filed on December 4, 1978. On or about December 13, the respondent answered the complaint, denied that it owed any additional compensation to the Petitioners, and requested that a hearing be conducted. By letter dated December 12, 1978, the Department of Agricultural and Consumer Services forwarded the matter to the office of the Division of Administrative Hearings for the assignment of a Hearing Officer and the scheduling of a hearing. The final hearing was scheduled to be conducted as set out above by notice dated January 12, 1979.

At the final hearing the Petitioners each testified on their own behalf, and called Rosalyn Lee as an additional witness. W.B. Stevens testified on behalf of the Respondent, and called Don Srum as an additional witness.

Petitioners' Exhibits 1-5 and Respondent's Exhibit 6 were offered into evidence and were received. Respondent's Exhibits 1-5 were offered into evidence, but were rejected.

FINDINGS OF FACT

1. The Petitioners and the Respondent had a business relationship under which the Respondent purchased watermelons from the Petitioners during the 1978 harvest season. Watermelons are at times sold on a "cash basis", which means

   that a buyer purchases the melons at the field for a set price per pound. At other times watermelons are sold on a "handle basis" or a "brokerage basis". Under these arrangements a buyer picks up a load of melons, sells it at the best obtainable price, and a portion of the sale price goes to the producer and a portion to the buyer. Prior to the 1978 harvest season, the Petitioners had had some unhappy experiences selling watermelons on a "handle" or "brokerage" basis. They decided to sell melons during the 1978 season only on a cash basis. The Respondent purchased several loads from the Petitioners during 1978 on a cash basis.

   
   

2. A dispute arose as to four loads of melons which the Respondent purchased from the Petitioners late in the 1978 harvest season. The Petitioners understood that the transactions would continue to be on a cash basis. The Respondent, who was represented by W.B. Stevens in the transactions, appears to have had the honest belief that the transactions would be on a brokerage basis. Mr. Stevens did not, however, reduce the brokerage arrangement to writing, and he did not adequately advise the Petitioners that the terms of the transactions would be different from previous transactions that year.

   
   

3. The four transactions were as follows: On May 30, 1978, the Respondent purchased 2,000 Grey watermelons which weighed 44,650 pounds at a quoted price of 4.75 cents per pound. On June 2, 1978, the Respondent purchased 1,330 Jubilee watermelons which weighed 45,470 pounds at 5.25 cents per pound. On June 5, 1978, the Respondent purchased 1,560 Grey watermelons which weighed 40,080 pounds at a quoted price of 4.50 cents per pound, and 1,550 Jubilee watermelons which weighed 44,100 pounds at a quoted price of 5.00 cents per pound. The total amount the Respondent owed the Petitioners for these four loads was $8,516.66. The Respondent issued the Petitioners a check for the loads in the amount of $5,453.72. The Petitioners are thus owed an additional

   $3,062.94.

   
   

4. The Respondent offered several affidavits into evidence. These were identified for the record as Respondent's Exhibits 1-5, but they were rejected. Even if the affidavits had been admissible, they would not serve to alter the findings of fact set out herein. The affidavits identified as Respondent's Exhibits 1, 3 and 4 relate to the quality of the watermelons. Since it has been found that the melons were sold on a cash basis, the Respondent took ownership of the melons when they were loaded onto the Respondent's trucks. The quality of the melons would not, therefore, affect the amount the Respondent owed the Petitioners. If the Respondent were going to reject the melons, it should have done so when they were loaded onto the trucks. The affidavit which was identified as Respondent's Exhibit 2 relates to a truck shortage that existed in Florida at the time that the Petitioners' melons were harvested. While this affidavit may tend to support the Respondent's contention that it intended these loads to be sold on a brokerage basis, it does not alter the fact that the Respondent did not adequately communicate this understanding to the Petitioners. The affidavit which was marked as Respondent's Exhibit 5 is unsigned. Furthermore, it relates only that Mr. Stevens believed that the transactions would be handled on a brokerage basis. The affidavits are hearsay and are not cumulative of other evidence in this case. They are therefore inadmissible. Even if the affidavits were admissible, however, they would have no relevance to the issues.

   
   

5. The Respondent is licensed with the Department of Agriculture and Consumer Services as an agricultural commodity dealer. The Respondent has a

   $20,000 bond on file with the Department.

   CONCLUSIONS OF LAW

   
   

6. The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding, and over the parties. Section 120.57(1), Florida Statutes (1978 Supp.).

   
   

7. Section 604.20(1), Florida Statutes (1978 Supp.) provides:

   
   

   Before any [agricultural commodity dealers] license shall be issued the applicant therefore shall make and deliver to the department a surety bond in the amount of at least $1,000 or such greater amount as the department may determine, . . . executed by a surety corporation authorized to transact business in the state. Such bond shall be upon a form prescribed or approved by the department and shall be conditioned to secure the faithful accounting for

   and payment to producers, their agents or representatives, of the proceeds of all agricultural products handled or sold by such dealer.

   
   

   Section 604.21(1), Florida Statutes (1978 Supp.) provides:

   
   

   Any person claiming himself to be damaged by any breach of the conditions of a bond given by a licensed dealer in agricultural products as herein before provided may enter a complaint therefore to the department Said

   complaint shall be filed within nine months from the date of the last transaction between the complaining producer and the dealer complained against.

   
   

   The remaining paragraphs of 604.21 provide that should the department conclude that the producer is entitled to compensation from the Respondent, the Respondent has fifteen days within which to satisfy the department's order.

   Thereafter, if the producer is not satisfied, a civil action can be maintained against the Respondent, and the surety.

   
   

8. The affidavits which the Respondent offered into evidence, and which were identified as Respondent's Exhibits 1-5 are inadmissible hearsay evidence. The affiants were not available to be cross examined by the Petitioners, and the evidence set out in the affidavits is not cumulative of direct evidence that was received. At the hearing the Respondent requested a continuance of the hearing so that he could call the affiants and additional persons as witnesses at a later date. The Respondent indicated that the witnesses could be available to testify in August or September, 1979, but not before. The Motion for Continuance is unreasonable, and it was denied at the hearing.

   
   

9. While there was no real meeting of the minds between the Petitioners and the Respondent with respect to the questioned four loads of watermelons, it

   is reasonable for the Petitioners to have believed that the sales would be on a cash basis. Previous sales during the 1978 harvest season had been on a cash basis, and the Respondent did not sufficiently inform the Petitioners that it wished to change the nature of the transactions. Furthermore, United States Department of Agriculture regulations require that brokerage arrangements be reduced to writing. The Respondent did not endeavor to reduce its understanding that the four loads would be handled on a brokerage basis to a written contract.

   
   

10. The Petitioners are entitled to $3,062.94 in additional compensation for agricultural commodities which they sold to the Respondent. If the Respondent fails to satisfy this obligation, the failure would constitute a breach of the condition of the bond which the Respondent has filed with the Department.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is, hereby

RECOMMENDED:

That a final order be entered by the Department of Agriculture and Consumer Services finding that the Petitioners are entitled to $3,062.94 in additional compensation for agricultural commodities which they sold to the Respondent, and requiring the Respondent to pay this sum to the Petitioners.

RECOMMENDED this 7th day of March, 1979, in Tallahassee, Florida.

G. STEVEN PFEIFFER Hearing Officer

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

904/488-9675

Filed with the Clerk of the Division of Administrative Hearings this 15th day of June.

COPIES FURNISHED:

Mr. W. B. Stevens President

Eastern Marketing Services, Inc.

P.O. Box 2156

Bartow, Florida 33830

Mr. Thomas H. Mancil

P.O. Box 303

Clewiston, Florida 33840

L. Earl Peterson, Chief Bureau of License & Bond Department of Agriculture Mayo Building

Tallahassee, Florida 32304

Honorable Doyle Conner Commissioner of Agriculture The Capitol

Tallahassee, Florida 32304

Robert A. Chastain General Counsel Department of Agriculture

and Consumer Services Mayo Building

Tallahassee, Florida 32304

Docket for Case No: 78-002432

Orders for Case No: 78-002432