STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL )

REGULATION, BOARD OF REAL )

ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 79-1843

)

GENARO O. DIDIEGO, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings by its duly designated Hearing Officer, Michael Pearce Dodson, held a final hearing in this case on January 31. 1980, and April 23, 1980, in Miami, Florida and Tallahassee, Florida, respectively. The following appearance was entered:

APPEARANCES

For Petitioner: Tina Ripple, Esquire

Staff Attorney

Department of Professional Regulation 2009 Apalachee Parkway

Tallahassee, Florida 32301 For Respondent: No appearance was entered.

These proceedings began on March 14, 1979, when the Bead of Real Estate, then the Florida Real Estate Commission, issued an Administrative Complaint against Respondent, Genaro O. DiDiego. No response to the complaint was filed by Respondent and on September 5, 1979, the matter was forwarded to the Division of Administrative Hearings for the assignment of a Hearing Officer and the scheduling a final hearing.

The five count Administrative Complaint alleges that Mr. DiDiego who is licensed as reall estate broker was guilty of fraud, misrepresentation, breach of trust, etc., in two separate business transactions with Ms. Arlene Channing. Because of these transactions the Petitioner seeks the revocation of Mr.

DiDiego's license as a real estate broker.

The final hearing was scheduled for and held on January 31, 1980. During the course of the hearing the Petitioner moved for a continuance based on the unavailability of a subpoenaed witness. Good cause was shown and the hearing was continued until April 23, 1980. In the interim the Petitioner filed an action in Circuit Court to enforce the Subpoena served on Gerald S. Berkell, Esquire. Subsequent thereto, Mr. Berkell agreed to appear and the hearing in this case was concluded on April 23, 1980.

At the final hearing Petitioner presented as its witnesses; Maria Robles, Arlene Channing, Albert J. Rourk, Jr., and Gerald S. Berkell, Esquire.

Petitioner offered Exhibits 1 through 17 into evidence and they were so received. Respondent made no appearance at either of the final hearing dates and therefore offered no witnesses or exhibits.

After the hearing Petitioner filed Proposed Findings of Fact. Careful consideration has been given to those proposed findings, To the extent that they are not contained in this order, they are rejected as being either not supported by competent substantial evidence or as irrelevant and immaterial to the issues for determination here.

FINDINGS OF FACT

1. During all times material to the Complaint Respondent Genaro O. DiDiego was licensed as a real estate broker under Chapter 475, Florida Statutes.

   
   

2. From May 1, 1976 until February 7, 1977, Mr. DiDiego did business under the trade name "Lauderdale Realty" in the Miami Beach Area.

   
   

3. In the spring of 1976 Ms. Arlene Channing through a salesman, Anita Kandel, employed by Lauderdale Realty met the Respondent. Ms. Channing was naive about the real estate business and any related transactions.

   
   

4. After their initial meeting the Respondent attempted to interest Ms. Channing in a variety of business ventures. Eventually she became involved in two. One was the Choice Chemical Company loan and the other was the Qualk Building purchase.

   
   

5. On May 10, 1976, Ms. Channing loaned Mr. DiDiego $30,000.00 for his purchase of stock in the Choice Chemical Company. This loan was to be secured by a note and mortgage from Mr. DiDiego to Ms. Channing in the principal sum of

   $30,000.00 with interest at 10 percent until the principal was paid. The note and mortgage were due and payable within 18 months. Specifically, the security was 50 percent of the outstanding stock of Choice Chemical Corporation and also Lauderdale Realty's lots and telephone land operation. The security was to be held in escrow by Gerald S. Berkell, who at that time was counsel to Mr.

   DiDiego.

   
   

6. In fact no such security was ever delivered into escrow. From the facts and circumstances of the transactions between Ms. Channing and Mr. DiDiego, it is found that Mr. DiDiego never intended to secure the $30,000.00 loan. That security was a material inducement to Ms. Channing for the loan. The principal sum of the loan, $30,000.00, was deposited into the account of Lauderdale Realty, account number 60-943-7 at County National Bank of North Miami Beach.

   
   

7. Subsequently on April 18, 1978, Ms. Channing filed an action in the Circuit Court of the Eleventh Judicial Circuit in and for Dade County, Florida, against Mr. DiDiego for the unlawful conversion of her $30,000.00. On June 19, 1978, a final judgement by default was entered against Mr. DiDiego in the amount of $30,000.00 plus legal interest.

   
   

8. The Qualk Building purchase concerned a building represented to Ms. Channing to cost $700,000.00. Mr. DiDiego induced her to invest $150,000.00 in the purchase of the Qualk Building. To effect the purchase, Mr. DiDiego and Ms. Channing entered into a limited partnership agreement in which Mr. DiDiego would

   be the general partner, investing $1,000.00 and Ms. Channing would be a limited partner, investing $150,000.00.

   
   

9. Subsequently Ms. Channing deposited $150,000.00 into the Lauderdale Realty escrow account. Her check dated June 18, 1976, in the amount of

   $150,000.00 was deposited in Account number 60-944-8 for Lauderdale Realty.

   
   

10. In fact, the total purchase price for the Qualk building was

    $585,000.00. The building was however encumbered by first and second mortgages totaling $535,855.90. The total amount therefore required to close was less than $33,000.00. These facts were known to Respondent but were not disclosed to Ms. Channing. From the facts and circumstances of this transaction, it is found that the facts were misrepresented to Ms. Channing for the purpose of inducing her to part with her $150,000.00.

    
    

11. Ms. Channing never received any accounting for her investment and she subsequently brought an action in the Circuit Court of the Eleventh Judicial Circuit in and for Dade County, Florida. On July 8, 1977, final judgment was entered against Respondent, Genaro O. DiDiego in the amount of $150,000.00 less

    $32,662.84, which were actually applied to the purchase price of the Qualk building, and less $9,780.00 which represents a portion of the income of the Qualk Building paid by Respondent to Ms. Channing. In entering its final judgment, the Court found that Respondent breached His fiduciary duty to Ms. Channing. This judgment has never been satisfied.

    
    

    CONCLUSIONS OF LAW

    
    

12. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this action. Section 120.57(1) and Section 120.65, Florida Statutes.

    
    

13. The Petitioner is authorized to suspend or revoke a real estate broker's license for being guilty of fraud, misrepresentation, concealment, false pretenses, false promises, dishonest dealing by trick, scheme or device, culpable negligence, or breach of trust in any business transaction and for failing to account or deliver to any person, upon demand of the person entitled to such accounting or delivery, any personal property such as money, fund, deposit, check, draft, etc., which has come into his hands and which is not his property or which he is not in law or equity entitled to retain under the circumstances. Section 475.25. Florida Statutes (1979).

    
    

14. At the time the alleged violations charged in the Administrative Complaint occurred, Section 475.25, Florida Statutes (1975) was in effect. It too provided for the suspension or revocation of a license for the foregoing reasons. It is concluded that by his dealings with Ms. Arlene Channing as set forth in the findings of fact Respondent is guilty of violating the above provisions.

    
    

15. It is further concluded that the Respondent, Genaro O. DiDiego has been guilty of a course of conduct or practice which shows him so dishonest or untruthful that the money, property, transactions and rights of investors or those with which he may sustain a confidential relation may not be safely entrusted to him. Section 475.25(3), Florida Statutes (1975) and Section 475.25(1)(n), Florida Statutes (1979).

RECOMMENDATION

In light of the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED

That the license of Genaro O. DiDiego as a real estate broker be revoked by the Board of Real Estate, Department of Professional Regulation.

DONE and RECOMMENDED this 3rd day of November, 1980, in Tallahassee, Florida.

MICHAEL P. DODSON

Hearing Officer

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

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 3rd day of November, 1980.

COPIES FURNISHED:

Tina Hipple, Esquire Staff Attorney

Department of Professional Regulation 2009 Apalachee parkway

Tallahassee, Florida 32301

C. B. Stafford

Board Executive Director Board of Real Estate

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802

Genaro O. DiDiego

3745 N.E. 171st Street

North Miami Beach, Florida 33160

Docket for Case No: 79-001843

Orders for Case No: 79-001843