STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE, )

)

Petitioner, )

)

vs. ) CASE NO. 79-1579

)

GRADY HAROLD OWENS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice an administrative hearing was held before Delphene C. Strickland, Hearing Officer of the Division of Administrative Hearings, in Room 821, Broward County Courthouse in Fort Lauderdale, Florida, commencing at 12:05

p.m. on March 5, 1980.

APPEARANCES

For Petitioner: Patrick F. Maroney, Esquire

Legal Division Department of Insurance

Room 428-A, Larson Building Tallahassee, Florida 32301

For Respondent: David R. Farbstein, Esquire

2610 West Oakland Park Boulevard Fort Lauderdale, Florida 33311

ISSUE

Whether the Respondent's licenses should be revoked, or whether lesser penalties should be imposed.

INTRODUCTION

The Respondent, Grady Harold Owens, a resident of Broward County, Florida, is licensed by the State of Florida as a Disability Agent, an Ordinary Life Agent, and an Ordinary-Combination Life Including Disability Agent and has been in the insurance business some thirty-two (32) years. An Administrative Complaint was filed against Respondent by the State Treasurer and Insurance Commissioner dated July 6, 1979, accusing him of numerous violations of law in reference to insurance transactions. A request for a formal administrative hearing was made by the Respondent.

A Motion to Dismiss was filed by Respondent Owens on November 1, 1979, contending that the Petitioner Department had failed to comply with Section 120.60(5) , Florida Statutes. Oral argument was heard on the Motion immediately prior to the formal hearing on March 5, 1980. Petitioner's "Exhibit 1" reflected that "Notice of Intended Administrative Action" was served on the

Respondent February 8, 1980. The instrument contained the same allegations as the previously filed Administrative Complaint and was an attempt to belatedly provide Respondent Owens with remedies contemplated by Section 120.60(6), Florida Statutes. The Respondent replied by letter dated February 9, 1980 (Petitioner's Exhibit 2), that his plea was "not guilty to any of these accusations." After oral argument, the Motion to Dismiss was denied. It was found that Respondent Owens had been given the opportunity to show that he had complied with all lawful requirements for the retention of his licenses, and his denial of the allegations required the formal hearing he had previously requested and at which he was in attendance.

During the course of the hearing, Petitioner's Motion to Dismiss Count III of the Administrative Complaint was granted.

Subsequent to the hearing both parties submitted proposed findings of fact, memoranda of law and proposed recommended orders. These instruments were considered in the writing of this order. To the extent the proposed findings of fact have not been adopted in or are inconsistent with factual findings in this order, they have been specifically rejected as being irrelevant or not having been supported by the evidence. Petitioner, the Department of Insurance, recommended that all licenses and eligibility for licenses of Respondent Owens be revoked. Respondent recommended that he be placed on probation or, at worst, suspended for a reasonable time.

FINDINGS OF FACT

1. The following Stipulation of the parties was entered into evidence:

   
   

   The Petitioner and Respondent through their undersigned attorneys hereby stipulate

   to the introduction into evidence at the hearing to be held in this matter the attach ed copies of insurance policy applications referenced in the Administrative Complaint filed in this cause The Respondent further states that the applications were submitted to the respective insurers by Respondent, the Respondent signed the applications and received commissions on some of said appli cations. (Petitioner's Exhibit 4)

   
   

2. An application was submitted to the Midwestern National Life Insurance Company by Respondent Owens in the name of Julia Lea Anderson, a witness for Petitioner, in September of 1977. In addition a form was submitted authorizing the automatic withdrawal of premium payments from Ms. Anderson's checking account. Ms. Anderson did not authorize, request or sign either the application for insurance or the check authorization withdrawal form.

   
   

3. Respondent's testimony as to how he obtained the information he certified to be true and correct was contradictory and not worthy of belief. The Hearing Officer finds that Respondent submitted the application and check withdrawal form to Midwestern without the permission, knowledge or consent of Ms. Anderson in order to obtain a fee, commission or other benefit.

   
   

4. An application for insurance was submitted to the Centennial Life Insurance Company together with an authorization form for said company to draw checks from a checking account of witness Roger Barone at the Dania Bank in

   Dania, Florida. Barone had never had an account at said bank and did not authorize or sign either the insurance application or the withdrawal form. Other applications not authorized or signed by Barone were submitted to the State Mutual Insurance Company and the Beneficial Standard Life Insurance Company. The application and the check withdrawal authorization were submitted by Respondent without the knowledge, consent or approval of Barone for the purpose of obtaining a fee, commission or other benefit.

   
   

5. Applications for insurance were submitted to the Midwestern National Life Insurance Company by Respondent in the name of Chris E. Konopinski, John Scott Konopinski and Troy Allen Konopinski, all children of Carol Konopinski. Ms. Konopinski did not sign or request such applications, although she was listed as the applicant and beneficiary (Petitioner's Exhibit 5). The applications were made by Respondent Owens to secure a benefit for himself.

   
   

6. Respondent filled out an application for insurance and check withdrawal form for Heather Gouvert without her signature or consent. Respondent admitted he thereafter sent a check dated November 13, 1976, to Ms. Gouvert in the amount of $24.25 marked "deposit only" to reimburse her for the amount the insurance company had drafted out of her account.

   
   

7. Herman J. Zottie, a regional director of agencies for the Midwestern National Life Insurance Company, explained that his insurance company has a plan for new applications: When a premium is paid through a bank authorization (called a pre-authorization check plan), the company pays ninety (90) percent of two years' commission to the agent upon the payment of one month's premium. If the policy is thereafter cancelled, the unearned amount paid to the agent is charged back to the agent's account.

   
   

   CONCLUSIONS OF LAW

   
   

8. The Division of Administrative Hearings has jurisdiction of this matter and the parties thereto pursuant to Section 120.57, Florida Statutes.

   
   

9. Respondent Owens violated Section 626.9541(11)(a), Florida Statutes, by filing applications for insurance and forms for withdrawal of funds while knowing the signatures were fraudulent and knowing the information had not been properly supplied by those named on the applications and forms as applicants.

   
   

10. Respondent Owens violated Sections 626.621(2) and (6), Florida Statutes, and then made restitution in some cases, but was the source of loss to members of the public by his deceptive acts.

    
    

11. Respondent Owens demonstrated by his acts his lack of trustworthiness to engage in the business of insurance by his dishonest practices in the conduct of business contrary to Sections 626.611(7), (9) and (13), Florida Statutes. He knew or should have known the rules and regulations of the Respondent, Department of Insurance, and complied with the same.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law the Hearing Officer recommends that all licenses and eligibility for licenses of the Respondent, Grady Harold Owens, be revoked.

DONE and ORDERED this 6th day of May, 1980, in Tallahassee, Leon County, Florida.

DELPHENE C. STRICKLAND

Hearing Officer

Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301

(904) 488-9675

COPIES FURNISHED:

Patrick F. Maroney, Esquire Legal Division

Department of Insurance Room 428-A, Larson Building Tallahassee, Florida 32301

David R. Farbstein, Esquire

2610 West Oakland Park Boulevard Fort Lauderdale, Florida 33311

Docket for Case No: 79-001579

Orders for Case No: 79-001579