STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
DEPARTMENT OF INSURANCE, )
)
Petitioner, )
)
vs. ) CASE NO. 79-332
)
KATHRYN G. SAVIAK, )
)
Respondent. )
)
RECOMMENDED ORDER
This matter came on for hearing in Fort Lauderdale, Florida, before the Division of Administrative Hearings, by its duly designated Hearing Officer, Robert T. Benton, II, on August 17, 1979. After all witnesses but respondent herself had testified on the parties' cases in chief, respondent announced that, on account of a migraine headache, she could not proceed, even though she wished to testify in her own behalf. Respondent's motion for continuance was granted, on condition that she surrender her license until the hearing reconvened. The hearing did not resume at the time first scheduled for its resumption because of another undocumented assertion of illness made at the eleventh hour. When the hearing did reconvene on February 21, 1980, respondent was not present and her counsel moved for a continuance on the ground of his client's illness. The motion was not supported by any affidavit or statement from a physician, and the motion for continuance was denied. The Division of Administrative Hearings received the final portion of the transcript on March 17, 1980. In these proceedings, the parties have been represented by counsel:
For Petitioner: Patrick F. Maroney, Esquire
S. Strom Maxwell, Esquire Department of Insurance The Capitol
Tallahassee, Florida 32301
For Respondent: Edward S. Jaffry, Esquire
S. Jack Carrouth, Esquire
Suite 800, Barnett Bank Building Tallahassee, Florida 32302
Other counsel appeared on behalf of various witnesses: J. Edwine Gay, Esquire, and Kenneth F. Hoffman, Esquire, on behalf of E.R. Milbourne, Jr.; Thomas Lang, Esq., Swann & Haddock, Orlando, on behalf of the Florida Joint Underwriting Association (FJUA) and Scott Blume.
By administrative complaint dated December 29, 1978, petitioner alleged, in count 1, that respondent "took an application for the [FJUA] and received payment for same in the amount of $309.00 for automobile insurance from Marvin and Carlene Grigg of Lauderhill," but that respondent failed to "forward the entire premium . . . to the USF&G Company in the regular course of business"; that the policy was cancelled for nonpayment as a result, although it was
"reinstated when USF&G learned the agent had received the entire premium but had not forwarded the same." Count II of the administrative complaint alleged that respondent "took an application for [FJUA] and received payment for the same in the amount of $257.00 for automobile insurance from one Constantine A. Ronca" but failed to "forward the entire premium . . . to the USF&G Company in the regular course of business"; with the result that the policy "was cancelled for nonpayment of premium by USF&G," although it was "subsequently reinstated when USF&G learned the agent had received the entire premium but had not forwarded same." Count III alleged that respondent "took an application and received payment in the amount of $153.00 for automobile insurance from one Antonio Vettorazzi for automobile insurance through JUA servicing carrier USF&G"; that a "premium finance agreement was executed for the balance of the premium through Capital [sic] Premium Plan, Inc."; that respondent received the balance of this premium from Capital Premium Plan, Inc., yet . . . failed to send the entire premium to USF&G in the regular course of business"; that the automobile policy was cancelled for nonpayment of premium as a result, although it was "subsequently reinstated when USF&G learned the agent had collected the entire premium but failed to remit same"; all in violation of Sections 624.11, 626.561(1), 626.611(1)(4)(7)(8)(10) and (13), 626.621(2)(3)(4) and (6), and
626.9541(15)(a) Florida Statutes (1977). In count IV, petitioner alleged that respondent "took an application and received payment in the amount of $112.00 for automobile insurance from one Linda M. Blair for insurance through the servicing carrier USF&G"; that a "premium finance agreement was executed for the balance of the premium through Capital Premium Plan, Inc."; that respondent "received the balance of this premium from Capital Premium Plan, Inc., yet . . . failed to send the entire premium to USF&G in the regular course of business"; that, as a result, Linda Blair's automobile policy was cancelled for nonpayment
. . . and subsequently reinstated when USF&G learned that the agent had received the entire premium but failed to remit same"; all in violation of Section 626.611(7)(9)(10)(13) and 626.621 (2), Florida Statutes (1977)
By order entered May 4, 1979, petitioner was granted leave to amend the administrative complaint by adding Counts XXVII through XLIV, inclusive.
Count XXVII alleges that respondent "took an application for the [FJUA] and received payment for same in the amount of. . . 442.00) for automobile insurance from Lori I. Sterling" but failed to "forward the entire premium . . . to the USF&G Company in the regular course of business"; with the result that the policy "was cancelled for nonpayment of premium by USF&G effective December 12, 1978." In Count XXVIII, petitioner alleged that respondent "took an application for the [FJUA] and received payment for same in the amount of . . . ($421.00) for automobile insurance from David D. Fuerst" but that respondent "did not forward the entire premium received from David D. Fuerst to the USF&G Company in the regular course of business"; with the result that the automobile policy issued to David D. Fuerst was cancelled for nonpayment of premium by USF&G effective January 1, 1979." In Count XXIX, petitioner alleged that respondent or one of her agents "took an application for the [FJUA] and received payment for the same in the amount of . . . ($200.00) for automobile insurance from William
P. Pete" but that respondent "did not forward the entire premium received from William P. Pete to the USF&G Company in the regular course of business"; with the result that "the automobile policy issued to William P. Pete was cancelled for nonpayment of premium by USF&G effective January 7, 1979." In Count XXX, petitioner alleged that respondent or her agent "took an application for the [FJUA] and received payment for same in the amount of . . . ($275.00) for automobile insurance from Linda J. Brown" but "did not forward the entire premium received from Linda J. Brown to the USF&G Company in the regular course of business"; with the result that "the automobile policy issued to Linda J.
Brown was cancelled for nonpayment of premium by USF&G Company effective December 25, 1978." In Count XXXI, petitioner alleged that respondent "took an application for the [FJUA] and received payment for the same in the amount of .
. . ($711.00) for automobile insurance from Robert C. Oberheim" but that respondent "did not forward the entire premium received from Robert C. Oberheim to the USF&G Company in the regular course of business"; with the result that "the automobile policy issued to Robert C. Oberheim was cancelled for nonpayment of premium by USF&G effective October 16, 1978." In Count XXXII, petitioner alleged that respondent or her agent "took an application for the [FJUA] and received payment for same in the amount of ($1,153.00) for automobile insurance from Jean L. and Paul Snyder" but that respondent "did not forward the entire premium received from Jean L. and Paul Snyder to the USF&G Company in the regular course of business"; with the result that "the automobile policy issued to Jean L. and Paul Snyder was cancelled for nonpayment of premium by USF&G effective May 22, 1978." In Count XXXIII, petitioner alleged that respondent "took an application for the [FJUA] and received payment for same in the amount of . . . ($733.00) for automobile insurance from Janie H. Fender" but that respondent "did not forward the entire premium received from Janie H. Fender to the USF&G Company in the regular course of business"; with the result that the automobile policy issued to Janie H. Fender was cancelled for nonpayment of premium by USF&G, effective November 20, 1978," all in violation of Sections 624.11, 626.561(1), 626.611(1)(4)(7)(8)(10)(13), 626.621(2)(3)(4) and (6), and
626.9541(15)(a), Florida Statutes (1977). In Count XXXIV petitioner alleged that "[o]n or about August 8, 1978, Joseph Guido . . . visited . . . [an agency] owned and operated by [respondent and] requested his USF&G automobile policy #8- 90-182815 be cancelled"; that the "cancellation request was transmitted to the USF&G Company on or about August 24, 1978"; that "USF&G then forwarded their draft . . . to the Time Premium Finance Company who had financed the premium for policy #8-90-182815"; that "Time Premium Finance Company in turn forwarded a check in the amount of . . . ($207.73) to [respondent] Agency as the return premium to be paid to Mr. Joseph Guido" but that "no return premium or monies were returned to Joseph Guido" until March 30, 1979," notwithstanding several contacts by Mr. Guido of respondent's agency, all in violation of section 626.561(1) and (2), section 626.611(7), (8), (9), and (10), 626.621(2) and (6),
and 626.9521, Florida Statutes (1977) and Rule 4-28.03, Florida Administrative Code. In Count XXXV, petitioner alleged that Joseph Guide "requested that he be added to policy #8-90-115918 issued in the name of one Patricia Rotola, Mr.
Guido's spouse on or about August 8, 1978; that the addition resulted in an additional premium of . . . ($475.00) which Mr. Guido paid on or about August 8, 1978," but that respondent "did not . . . forward the entire premium received from . . . Joseph Guide to the USF&G Company in the regular course of business"; with the result that "on or about October 9, 1978, a notice of termination of policy #8-90-115918, effective 10/23/78 for non-payment of premium . . . [because USF&G] had not received the additional premium as to said policy," in violation of "sections 624.11, 626.561(1), 626.611(1), (4), (7), (8), (10),
(13), 626.621(2),(3),(4),(6) and 626.9541 (15)(a), Florida Statutes (1977). In
Count XXXVI, petitioner alleged that respondent took an application for the [FJUA] and received payment from one Shirley J. Payne . . . in the amount of ($300.00)"; that Ms. Payne subsequently paid an additional $382.32, but that, as of the middle of February, 1979, Ms. Payne still had not received a policy . . . despite repeated demands and requests of [respondent's] agency," in violation of section 626.611 ( ), (4), (7)(8), (9), (10) and (13) and 626.621 (2), (3), (4)
and (6), and 626.9641(1)(e) and (f), and 627.421, Florida Statutes (1977). In Count XXXVII, petitioner alleged that "Nancy Ruf . . . and her daughter Denise were quoted a premium for automobile insurance by respondent or her agent of
$401.00 of which $140.00 was paid on or about December 14, 1978; that "Mrs. Ruf telephoned [respondent's] agency and cancelled the policy as of January 5, 1979,
with a written request for cancellation addressed to the agency dated January 9, 1979," but that no refund had been received as of March 17, 1979, in violation of Sections626.561(1), 626.611(7), (8), (9), and (10), and 626.621(2) and (6),
and 626.9521, Florida Statutes (1977). In Count XXXVIII, Petitioner alleged that respondent or her agent "received United States Fidelity and Guaranty Company check #F110517 made payable to the order of Sylvia Robbins of Hallandale, Florida, dated December 1, 1978, in the amount of . . . ($256.00)"; that respondent or her agent "acting under [her] direction or supervision did write or caused to be written an unauthorized signature of Sylvia Robbins as endorsement of the aforementioned check"; that respondent "did deposit or cause to be deposited the aforementioned check to the bank account of J & J Insurance Agency at the Commercial Bank and Trust Company, Miami, Florida,"; that even though the check represented a return premium due Sylvia Robbins, respondent "had not forwarded said return premium to Sylvia Robbins as of March 28, 1979, .
. . [but that respondent] misappropriated, converted or unlawfully withheld monies belonging to insureds," in violation of Sections 626.561 (1) and (2), 626.611(7), (8), (9) and (10), and 626.621(2) and (6), and 626.9521, Florida
Statutes (1977). In Count XXXIX, petitioner alleged that respondent or her agent acting under [her] direction or supervision, received United States Fidelity and Guaranty Company (USF&G) check #111558 made payable to the order of Robert K. Kaganac of Hollywood, Florida, dated December 11, 1978, in the amount of . . . ($44.00)"; that respondent or her agent "acting under [her] direction or supervision did write or cause to be written the unauthorized signature of Robert K. Kaganac as endorsement of the aforementioned check"; that respondent "did deposit or cause to be deposited the aforementioned check to the bank account of J & J Insurance Company at the Commercial Bank and Trust Company, Miami, Florida"; that, although the check represented a return premium due Robert K. Kaganac, respondent had "not forwarded said return premium to Robert
Kaganac as of March 28, 1979 [but that respondent] misappropriated, converted or unlawfully withheld monies belonging to insureds . . . [in violation of] sections 626.561(1)(2), 626.611(7)(8)(9)(10), 626.621(2)(6) and 626.9521, Florida Statutes' (1977). In Count XL, petitioner alleged that respondent or her agent, "acting under [her] direction or supervision, received United States Fidelity and Guaranty Company (USF&G) check #F106883 made payable to the order of Patricia Vickery of Davie, Florida, dated December 1, 1978, in the amount of
. . . ($30.00)"; that respondent or her agent "acting under [her] direction or supervision, did write or caused to be written the unauthorized signature of Patricia Vickery as endorsement of the aforementioned check"; that respondent "did deposit or cause to be deposited the aforementioned check to the bank account of J & J Insurance agency at the Commercial Bank and Trust Company, Miami, Florida; that, although the check represented return premium due Patricia Vickery, respondent had "not forwarded said return premium to Patricia Vickery as of March 30, 1979" but that respondent "misappropriated, converted or unlawfully withheld monies belonging to insureds." In Count XLI, petitioner alleged that respondent or her agent "acting under [her] direction or supervision received United States Fidelity and Guaranty Company (USF&G) check #F111000 made payable to the order of J. Bruce Garland of Ft. Lauderdale, Florida, dated December 1, 1978, in the amount of . . . ($54.00)"; that respondent or her agent "acting under [her] direction or supervision did write or caused to be written the unauthorized signature of J. Bruce Garland as endorsement of the aforementioned check"; that respondent did deposit or caused to be deposited the aforementioned check to the bank account of J & J Insurance Agency at the Commercial Bank and Trust Company, Miami, Florida"; that, although the check represented return premium due J. Bruce Garland, respondent had not "forwarded said return premium to J. Bruce Garland as of April 4, 1979," but that respondent "misappropriated, converted or unlawfully withheld monies belonging to insureds."
In Count XLII, petitioner alleged that respondent or her agent "acting under [her] direction or supervision, received United States Fidelity and Guaranty (USF&G) check #F107747 made payable to the order of James J. Greco of Hollywood, Florida, dated November 15, 1978, in the amount of . . . ($57.00)"; that respondent or her agent "acting under [her] direction or supervision, did write or caused to be written the unauthorized signature of James J. Greco as endorsement of the aforementioned check"; that respondent "did deposit or caused to be deposited the aforementioned check to the bank account of J & J Insurance Agency at the Commercial Bank and Trust Company, Miami, Flo[ri]da"; that although the check represented return premium due James J. Greco, respondent had "not forwarded said return premium to James J. Greco as of April 4, 1979," but that respondent "misappropriated, converted or unlawfully withheld monies belonging to insureds." In Count XLII, petitioner alleged that respondent or her agent "acting under [her] direction or supervision, received United States Fidelity and Guaranty Company (USF&G) check #F110271 made payable to the order of Guillermo Citelli of Hollywood, Florida, dated November 22, 1978, in the amount of ($91.00)"; that respondent or her agent "acting under [her] direction or supervision did write or cause to be written the unauthorized signature of Guillermo Citelli as endorsement of the aforementioned check"; that respondent "did deposit or caused to be deposited the aforementioned check to the bank account of J & J Insurance Company at the Commercial Bank and Trust Company, Miami, Florida"; that, although the check represented a return premium to Guillermo Citelli, respondent "had not forwarded the entire premium . . . to Guillermo Citelli as of April 5, 1979," but that respondent "misappropriated, converted or unlawfully withheld monies belonging to insureds." In Count XLIV, petitioner alleged that respondent or her agent "acting under [her] direction or supervision, received United States Fidelity and Guaranty Company (USF&G) check #110568 made payable to the order of Kevin V. McGuire, of Hollywood, Florida, dated December 5, 1978, in the amount of . . . ($53.00)"; that respondent or her agent "acting under [her] direction or supervision, did write or caused to be written the unauthorized signature of Kevin V. McGuiro as endorsement of the aforementioned check"; that respondent "did deposit or caused to be deposited the aforementioned check to the bank account of J & J Insurance Agency at the Commercial Bank and Trust Company, Miami, Florida"; that although the check represented a return premium due Kevin V. McGuire, respondent "had not forwarded the entire return premium . . . to Kevin V. McGuire as of April 5, 1979," but that respondent "misappropriated, converted or unlawfully withheld monies belonging to insureds [in violation of] sections 626.561(1)(2), 626.611(7)(8)(9)(10), 626.621(2)(6) and 626.9521, Florida Statutes" (1977).
At the final hearing, petitioner voluntarily dismissed without prejudice, Counts V, VI, VII, VIII and IX of the administrative complaint. Counts X through XXVI, inclusive, contain allegations of misconduct by respondent at various times before April 13, 1976. They are the same allegations that petitioner made in a notice and order to show cause filed on or about April 13, 1976, Case No.
76-L-23M, which eventuated in a consent order entered on August 24, 1977. The consent order imposed an administrative fine and placed respondent on probation on the condition, inter alia, that she "fully comply with all the insurance laws of the State of Florida, and all the rules of the Department of Insurance." On respondent's motion, Counts X through XXVI, inclusive, of the administrative complaint in the present case were dismissed, over petitioner's objection, as having been disposed of in the consent order in the previous case. Over respondent's objection, petitioner was granted leave to amend the administrative complaint at the final hearing to allege that "the matters alleged as . . . independent grounds for disciplinary action are also matters which . . . justify revocation of probation." (T.I:28)
FINDINGS OF FACT
Respondent, Kathryn Genevieve Saviak, did business as J & J Insurance Agency at all times pertinent to these proceedings. As a general lines insurance agent, she maintained five offices at one time or another in Dade, Broward and Hillsborough counties, for the sale of automobile insurance.
Respondent did not deal with customers directly herself. She visited her offices occasionally, perhaps once a month, and spoke to the office managers more frequently by telephone. Some of her employees travelled among offices.
Respondent authorized her employees to write insurance policies on behalf of the FJUA under an arrangement with the United States Fidelity and Guaranty Company (USF&G), a servicing carrier for the FJUA. Prior to December, 1978, respondent was the only licensed agent with the J & J Insurance Agency assigned to USF&G. Agents like respondent who represented the FJUA were required to forward to the servicing carrier money thee received in payment of premiums on the date received or, at the latest, on the following day. An agent need not require payment of the entire premium in order to write an insurance policy, so long as the agent collected a specified minimum deposit. Any money actually collected above the amount of the minimum deposit, however, was to be forwarded to the servicing carrier daily. E.R. Milbourne, Jr., the USF&G employee with direct charge of FJUA operations, personally apprised respondent at various times, including prior to 1978, of the requirement that monies be forwarded upon receipt. Agents were first advised of this requirement in writing on or about September 17, 1973.
Respondent is one of approximately 250 agents for whom USF&G has been designated the servicing carrier by FJUA. Respondent's offices wrote 60 to 70 policies a month as compared to USF&G's 25,000 FJUA policies a year. The FJUA policies respondent's offices wrote became effective on the date they were written. USF&G then had thirty days in which to issue the policy. In its last audit before the final hearing began, USF&G determined that two percent of its private passenger vehicle policies and four percent of its commercial vehicle policies had not been issued within the thirty-day period. Routinely, USF&G issued a notice of termination if the premium for a policy had not been paid in full within thirty days, but, in some cases, as many as sixty days might have elapsed from the date of application before USF&G issued a notice of termination.
On March 30, 1978, Carlene Grigg made application for automobile insurance at respondent's Ft. Lauderdale Office. She made payment of $309.00 at that time. USF&G received the application on May 15, 1978, accompanied by only
$200.00. In late July, Carlene's husband, Marvin, received a notice of termination from USF&G dated July 26, 1978, stating that USF&G was owed $188.00. Petitioner's exhibit No. 5. In September, Mr. and Mrs. Grigg paid an additional
$73.00 to respondent's Ft. Lauderdale office. On or about November 6, 1978, USF&G received an additional $139.00 from respondent's Ft. Lauderdale office. Together with the initial $200.00, this constituted full payment of the premium for the policy Ms. Grigg applied for on March 30, 1978 (which has subsequently been revised to eliminate physical damage coverage, resulting in a decrease in premium.) (Count I)
On August 14, 1978, Constantine A. Ronca made application for an automobile insurance policy at respondent's Ft. Lauderdale office and paid
$257.00. USF&G received Mr. Ronca's application later in August, accompanied by
$100.00. USF&G sent a notice of termination dated October 26, 1973, to be effective November 9, 1978, for the stated reason of unpaid premium. (Count II)
On June 27, 1978, Antonio Vettorazzi purchased automobile insurance at respondent's Ft. Lauderdale office. Against a total premium of $437.00, Mr. Vettorazzi made a down payment of $153.00. The balance of the premium, $284.00, was financed. USF&G received Mr. Vettorazzi's application from respondent's Ft. Lauderdale office accompanied by a check for $284.00. Thereafter Mr. Vettorazzi received a notice of termination from USF&G dated November 15, 1978, threatening to terminate the policy effective November 29, 1978, for alleged nonpayment of a premium balance of $153.00. In late November or early December of 1978, USF&G received a check for $153.00 from respondent's Ft. Lauderdale office. Although Mr. Vettorazzi made his payments to the premium finance company, he made no additional payments directly to respondent after June 27, 1978. (Count III)
Also on June 27, 1978, Linda Diane Moray Blair purchased automobile insurance from respondent's Ft. Lauderdale office. Against a total premium of
$308.00 she made a cash down payment of $112.00, for which she received a receipt. Petitioner's exhibit No. 2 attached to petitioner's exhibit No. 3. The balance of the premium was financed by Capitol Premium Plan, Inc. Ms. Blair made monthly payments of $29.20 to Capitol Premium Finance in a timely fashion.
Subsequently she received a notice from J & J Insurance that another $10.00 was due. In September of 1978, Ms. Blair sent a $10.00 money order to respondent's Ft. Lauderdale office. Thereafter, Ms. Blair received from USF&G a notice of termination dated October 12, 1978, stating that a balance was owed the company of $122.00. On October 27, 1978, USF&G received from respondent's Ft. Lauderdale office a check in the amount of $122.00. (Count IV)
On October 18, 1978, David G. Fuerst purchased automobile insurance at respondent's Ft. Lauderdale office. He wrote a check for $210.00, half the annual premium. On November 21, 1978, Mr. Fuerst wrote another check in favor of J & J Insurance for the remainder of the premium in the amount of $210.00. Petitioner's exhibit No. 8. When USF&G received Mr. Fuerst's application, respondent's check in the amount of $150.00 accompanied the application. Eventually USF&G issued a notice of termination dated December 18, 1978, advising Mr. Fuerst that his policy would be terminated on account of an unpaid balance of $270.00. Petitioner's exhibit No. 9. Shortly after receiving the notice of termination, Mr. Fuerst received from respondent's Ft. Lauderdale office a form "Special Notice" stating that the cancellation of the policy "was due to a computer error. Petitioner's exhibit No. 10. On January 9, 1979, USF&G received the $270.00 balance from respondent's Ft. Lauderdale office. (Count XXVIII)
On October 30, 1978, William Patrick Pete went into respondent's Ft. Lauderdale office. He purchased an automobile insurance policy for which he paid the entire premium of $170.00. Additionally, he purchased membership in an automobile club for which he paid $30.00. USF&G received Mr. Pete's application on November 8, 1978, accompanied by respondent's check for $50.00. On December 26, 1978, USF&G sent Mr. Pete a notice of termination for the stated reason that he owed $120.00 toward his premium. On January 9, 1979, USF&G received $120.00 from respondent's Ft. Lauderdale office. (Count XXIX)
On October 3, 1978, Linda J. Brown purchased insurance from respondent's Ft. Lauderdale office. On that date she made a do payment of $96.00 against a total premium of $275.00. She financed the remainder of the premium,
$179.00, under an agreement with Time Premium Company. Petitioner's exhibit No.
15. USF&G received Ms. Brown's application on October 18, 1978, accompanied by a
check for $179.00. On December 11, 1978, USF&G directed a notice of termination to Ms. Brown for the stated reason that she owed $96.00 on her premium.
Petitioner's exhibit No. 16. On January 2, 1979, USF&G received from respondent a check in the amount of $96.00. (Count xxx)
12. In July, 1978, Robert Charles Oberheim purchased insurance from respondent's Ft. Lauderdale office. He made a down payment of $249.00 against a quoted premium of $711.00. He financed the balance of $462.00, and made regular monthly payments of $63.00. When USF&G issued Mr. Oberheim's policy, it adjusted the premium downward by $40.00 so that the total premium was in fact $671.00. On October 2, 1978, USF&G issued a notice of termination for the stated reason of a balance owing by Mr. Oberheim of $209.00. Thereafter, some time before October 16, 1978, USF&G received respondent's check in the amount of $209.00. Not until August 1, 1979, did J & J Insurance draw a check in favor of Mr. Oberheim in the amount of $40.00, representing the refund he was owed. Petitioner's exhibit No.
(Count XXXI)
On November 4, 1977, Jean L. Snyder, wife of Paul Snyder, purchased automobile insurance from respondent's Miami office. She was quoted a premium of
$1,153.00 and wrote a check for the full amount on November 16, 1977. Petitioner's exhibit No. 20. USF&G received this application on February 13, 1978, accompanied by a check in the amount of $400.00. (Count XXXII)
On February 9, 1978, Joseph J. Guido purchased automobile insurance from respondent's Ft. Lauderdale office. He made a down payment of $221.00 against a total premium of $631.00, and financed the balance of $410.00 under an agreement with Time Premium Company. Petitioner's exhibit No. 25. He subsequently sold the vehicle he had insured and, on August 8, 1978, cancelled the policy. On August 28, 1978, Time Premium Company received a $490.00 refund check from USF&G. Brooksie Peeples, Time Premium Company's manager, deposited this check against Mr. Guido's account. The check was enough to pay off Mr. Guide's indebtedness to Time Premium Company in its entirety, with $207.73 remaining. This balance was forwarded to respondent's Ft. Lauderdale office on September 13, 1978. Petitioner's exhibit No. 26. The check was deposited on September 19, 1978. Beginning in November of 1978, Mr. Guido and his wife made repeated demands for the refund. Finally, when Mr. Guide refused to leave the premises until the check was written, on March 29, 1979, the manager of respondent's Ft. Lauderdale office wrote Mr. Guide a check for $207.73. (Count XXXIV)
On December 7, 1978, Shirley Payne purchased automobile insurance from respondent's Ft. Lauderdale office. On that date she made a down payment in the amount of $300.32 against a quoted premium of $682.32. She was told she would receive her policy within thirty days, along with a bill for the balance due. In fact, she received her policy in March of 1979. She paid respondent another
$100.00 on March 20, 1979, petitioner's exhibit No. 28, and the final $282.00 on March 28, 1979. Petitioner's exhibit No. 29. USF&G received Ms. Payne's application on February 28, 1979, accompanied by a check in the amount of
$214.00. (Count XXXVI)
Lena Sabel accompanied her daughter, Sylvia Robbins, to purchase automobile insurance at respondent's Hollywood office on July 25, 1978. On that date Ms. Sabel wrote a check in the amount of $556.23 in favor of J & J Insurance Agency. Petitioner's exhibit No. 22. The total premium for the policy she purchased was $406.00. When USF&G received the Robbins' application from respondent it was accompanied by a check in the amount of $150.00. On October 23, USF&G issued a notice of termination for the stated reason that $256.00 was
owed for the premium. On receipt of this notice, Ms. Robbins' son sent USF&G a check for $256.00. It arrived shortly after a check in the same amount that respondent's office sent. Having received duplicate checks, USF&G wrote a refund check to the order of Sylvia Robbins in the amount of $256.00 and forwarded the check to respondent. Sylvia Robbins' endorsement was forged and the check was deposited to the J & J Insurance Premium account at the Commercial Bank and Trust Company in Miami. About two weeks before the final hearing began, Ms.
Sabel received a refund check in the amount of $256.00. (Count XXXVIII)
USF&G drew Check No. 111558 in favor of Robert K. Kaganac in the amount of $44.00 on December 11, 1978, and forwarded the check in care of respondent's Hollywood office. Mr. Kaganac's endorsement was forged and the check was deposited to J & J Insurance Premium account at Commercial Bank and Trust Company in Miami. (Count XXXIX)
On December 1, 1978, USF&G drew a check to the order of J. Bruce Garland in the amount of $54.00 and forwarded it to respondent's Ft. Lauderdale office. There Mr. Garland's endorsement was forged and the check was deposited to the J & J Insurance Premium account at the Commercial Bank & Trust Company in Miami. On August 1, 1979, respondent mailed Mr. Garland a check in the amount of
$24.00. (Count XLI)
Guillermo Citelli purchased automobile insurance at respondent's Hollywood office. On November 22, 1978, USF&G drew its check No. F110271 in favor of Mr. Citelli in the amount of $91.00 and forwarded it to respondent's Hollywood office. Mr. Citelli's endorsement was forged and the check was deposited to the J & J Insurance Premium account at the Commercial Bank & Trust Company in Miami. (Count XLIII)
On October 11, 1978, Kevin B. McGuire purchased automobile insurance at respondent's Hollywood office. On that day he paid a premium of $108.00. He later requested that the policy be cancelled. On December 5, 1975, USF&G drew its check No. F110568 in favor of Kevin B. McGuire in the amount of $53.00 and forwarded the check to respondent's Hollywood office. Mr. McGuire's endorsement was forged and the check was deposited to the J & J insurance Premium account at the Commercial Bank & Trust Company in Miami. In January, 1979, Mr. McGuire received a refund from respondent in the amount of $53.00. (Count XLIV)
In each instance in which it was shown that USF&G had cancelled a policy for which respondent had failed to forward the entire premium, USF&G later reinstated the policy, effective retroactively to the date of cancellation.
Paula Davis, who managed respondent's Hollywood office from March of 1978, until January of 1979, was instructed by respondent to forge endorsements on refund checks and did so. This practice antedated Ms. Davis' employment at the Hollywood office. Marie Vernon, also employed by respondent at her Hollywood office, forged endorsements on refund checks, believing respondent had directed that this be done. Before each forgery, a photostat of the refund check was made and attached to the pertinent file against the possibility that the payee might make demand for the refund. Deborah Goldberg's testimony on this and other points has not boon credited.
With respect to certain classes of insurance, respondent instructed Ms. Davis to forward to USF&G only a specified minimum deposit even when the office received more than the minimum deposit toward payment of the premium. With respect to these policies, respondent gave Ms. Davis standing instructions
to forward the premium balances only upon receipt of notices of termination from USF&G. These instructions were followed, and monies belonging to USF&G were diverted to a separate account.
Respondent also represented an Alabama insurance company to whom she forwarded premiums as promptly as that company required. Many of her employees engaged in no improper conduct of any kind and were completely unaware of what was going on.
Both parties have furnished proposed findings of fact which have been considered in preparation of the foregoing findings of fact. Proposed findings of fact inconsistent with the foregoing are hereby expressly rejected.
CONCLUSIONS OF LAW
By statute in force at the time of the occurrences at issue in these proceedings, petitioner is required to take disciplinary action against respondent's license when any of the following is shown:
Lack of one or more of the qualifications for the license or permit as specified in this code . . .
(4) If the license or permit is
willfully used, or to be used, to circumvent any of the requirements or prohibitions of this code . . .
For demonstrated lack of fitness
or trustworthiness to engage in the business of insurance.
For demonstrated lack of reasonably adequate knowledge and technical competence to engage in the transactions authorized by the license or permit.
Fraudulent or dishonest practices
in the conduct of business under the license or permit.
Misappropriation, conversion,
or unlawful withholding of monies be longing to insurers or insureds or beneficiaries
or others and received in conduct of business under the license . . .
(13) Willful failure to comply with,
or willful violation of, any proper order, rule or regulation of the department, or willful violation of any provision of this code. Section 626.611, Florida Statutes (1977)
Petitioner has discretion to take disciplinary action against a liceasee whenever there is shown to be:
Violation of any provision of
this code or of any other law applicable to the business of insurance in the course of dealing under the license or permit.
Violation of any lawful order or rule or regulation of the department.
Failure or refusal, upon demand,
to pay over to any insurer he represents, or has represented any money coming into his hands belonging to the insurer. . .
(6) If in the conduct of business
under the license or permit he is engaged in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under Part VII of this chapter, or has otherwise shown himself to be a source of injury or loss to the public or detrimental to the public interest. Section 626.621, Florida Statutes (1977).
Clear and convincing evidence is required for the showing necessary for disciplinary action against an occupational licensee to be taken. Reid v. Florida Real Estate Comm'n, 188 So.2d 846 (Fla. 2d DCA 1966).
In its proposed findings of fact, petitioner, in effect, abandoned Counts XXVII, XXXIII, XXXV, XXXVII, XL and XLII.
With respect to the allegations in Counts I through IV, XVIII through XXXII, XXXIV and XXXVI, petitioner alleges that is has demonstrated violations of the following provisions:
Knowingly collecting any sum as a premium or charge for insurance, which is not then provided, or is not in due course
to be provided, subject to acceptance of the risk by the insurer, by an insurance policy issued by an insurer as permitted by this code. Section
626.9541(15)(a), Florida Statutes (1977)
All premiums, return premiums, or other funds belonging to insurers or others received by an agent, solicitor, or adjuster in transactions under his license shall be trust funds so received
by the licensee in the fiduciary capacity, and the licensee in the applicable
regular course of business shall account for and pay the same to the insurer, insured or other person entitled thereto.
Section 626.561(1), Florida Statutes (1977).
Subsection two of Section 626.561, Florida Statutes (1977), makes any agent who "diverts or appropriates such funds or any portion thereof to his own use" guilty of a criminal offense, upon conviction.
Petitioner has alleged that the facts on which Counts XXXVIII, XXXIX, XLI, XLIII, and XLIV are predicated also constitute violations of Section 626.561(1), Florida Statutes (1977), and amount to unfair or deceptive acts or practices within the meaning of Section 626.9521, Florida Statutes (1977). In addition, Section 624.11, Florida Statutes (1977), forbids "transact[ing] insurance in Florida . . . without complying with the applicable provisions of [the insurance] code."
Petitioner amply demonstrated that respondent failed to forward to USF&G, "in the regular course of business" all or part of several insurance premiums her employees collected on behalf of USF&G, in violation of Section 626.561, Florida Statutes (1977). Petitioner also established violations of the same statute by proving multiple instances in which respondent's employees converted refund checks, withholding them from insured persons, in keeping with respondent's instructions to Ms. Davis.
Petitioner did not prove by clear and convincing evidence, however, that respondent had any personal involvement with any violation of Section 626.9541(15)(a), Florida Statutes (1977), or that respondent was responsible for the delay in the issuance of Shirley Payne's insurance policy.
The evidence clearly and convincingly showed that respondent lacks the requisite "fitness or trustworthiness to engage in the business of insurance"; that she has been guilty of "[f]raudulent or dishonest practices in the conduct of business under [her] license or permit"; that she withheld "monies belonging to insurers [and] insureds . . . received in conduct of business under the license"; and that she intentionally violated provisions of the insurance code as well as Rule 4-28.03, Florida Administrative Code, all in violation of Section 626.611(4), (7), (9), (10) and (13), Florida Statutes (1977). Petitioner must, therefore, "suspend or revoke . . . [respondent's] license . . . and . . . [her] eligibility to hold a license." Section 626.611, Florida Statutes (1977)
Because petitioner must suspend or revoke, pursuant to Section 626.611, Florida Statutes (1977), the question whether petitioner is also authorized to take these actions in its discretion, pursuant to Section 626.621, Florida Statutes (1977), becomes moot. Similarly, the question whether the fact that respondent was on probation at the time of the misconduct proven in these proceedings affords an independent basis for disciplinary action also becomes moot.
Upon consideration of the foregoing, it is RECOMMENDED:
That petitioner revoke respondent's license and her eligibility for licensure.
DONE and ENTERED this 16th day of April, 1980, in Tallahassee, Florida.
ROBERT T. BENTON, II
Hearing Officer
Division of Administrative Hearings Room 101 Collins Building Tallahassee, Florida 32301
(904) 488-9675
COPIES FURNISHED:
Patrick F. Maroney, Esquire
S. Strom Maxwell, Esquire Department of Insurance The Capitol
Tallahassee, Florida 32301
Edward S. Jaffry, Esquire.
S. Jack Carrouth, Esquire Suite 300, Barnett Bank Building
Tallahassee, Florida 32302
| Issue Date | Proceedings |
|---|---|
| May 29, 1980 | Final Order filed. |
| Apr. 16, 1980 | Recommended Order sent out. CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| May 28, 1980 | Agency Final Order | |
| Apr. 16, 1980 | Recommended Order | Petitioner and her agents converted premium checks and failed to forward them to the insurance companies. Revoke license and eligibility. |
DEPARTMENT OF INSURANCE vs DANIEL LEE ALISON, 79-000332 (1979)
DEPARTMENT OF INSURANCE AND TREASURER vs. KEVIN DENIS COX, 79-000332 (1979)
DEPARTMENT OF INSURANCE AND TREASURER vs. JOHN WAYNE PENNINGTON, 79-000332 (1979)
DEPARTMENT OF INSURANCE vs MARIA AMELIA POU, 79-000332 (1979)
DEPARTMENT OF INSURANCE vs RICHARD ROSENBLUM, 79-000332 (1979)
