STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STATE OF FLORIDA, DEPARTMENT OF ) PROFESSIONAL REGULATION, ) FLORIDA CONSTRUCTION INDUSTRY ) BOARD, )

)

Petitioner, )

)

vs. ) CASE NO. 79-1971

)

RICHARD E. ULBRICHT, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, James E. Bradwell, held a public hearing in this case on March 10, 1980, in West Palm Beach, Florida. Pursuant to leave, the parties were allowed through April 3, 1980, to submit memoranda supportive of their respective positions. Petitioner's counsel filed his memorandum on April 3, 1980, which was considered by me in preparation of this Recommended Order.

APPEARANCES

For Petitioner: Michael Egan, Esquire

ROBERTS AND EGAN, P.A.

Post Office Box 1386 Tallahassee, Florida 32301

For Respondent: 1/ Robert Clay Kime, Esquire

363 South County Road

Palm Beach, Florida 33480 ISSUE

The issue posed for decision herein is whether or not

the Respondent has engaged in conduct, more particularly set forth hereinafter as noticed by the Administrative Complaint filed herein, which conduct warrants the Petitioner to take disciplinary action against Respondent and his registered contractor's license.

FINDINGS OF FACT

Based upon my observation of the witnesses and their demeanor while testifying, the arguments of counsel and the entire record compiled herein, the following relevant facts are found.

1. Based on an Administrative Complaint filed on July 6, 1979, the Florida Construction Industry Licensing Board (herein sometimes referred to as the Petitioner or the Board) seeks to take disciplinary action against Licensee

   Richard E. Ulbricht, d/b/a Ulbricht Construction, Inc., and to impose an administrative fine or $500.00. Respondent is a registered contractor who holds the following licenses:

   
   

   1. RG 0011921 - Registered General/Active/Issued

   2. RGA 0011921 - Registered General/Active/Issued

   3. RG OB 11921 - Registered General/Delinquent

   4. RM 0014920 - Registered Mechanical/Active/Issued

   5. RM 0017586 - Registered Mechanical/Delinquent

   6. RS 0019201 - Registered Sheet Metal/Active/Issued

   7. RC 0019264 - Registered Roofing/Active/Issued

      
      

2. Respondent was first licensed by the Petitioner during February, 1972. On June 14, 1977, Respondent qualified Ulbricht Construction, Inc., as the business entity through which he would conduct his contracting business.

   
   

3. The construction activities involved herein took place in the City of Palm Bay, Florida. Palm Bay has no local licensing board. On June 12, 1978, Respondent entered into a contract with Michael D. and Karen K. McCammack to construct a residence for the sum of $39,900.00. Respondent received the full contracted price and the transaction closed on January 4, 1979. Chelsea Title and Guaranty Company closed the transaction for Respondent and the McCammacks on January 4, 1979.

   
   

4. Camille Guilbeau is the manager for the Palm Bay branch of Chelsea Title and Guaranty Company. Ms. Guilbeau is in charge of all closing and as such ensures that all outstanding obligations of record are paid. In keeping with Chelsea's policy of protecting itself in the event of outstanding unrecorded claims of liens, Chelsea has a policy of requiring contractors and builders such as Respondent to declare in an affidavit that there is no outstanding work which has been performed, or labor or materials for which a lien could be filed on property in which Chelsea is closing the mortgage transaction. Respondent executed such an affidavit relative to the McCammacks' property, which Chelsea relied on to close the transaction on January 4, 1979 (Petitioner's Exhibit 4). On January 4, 1979, Chelsea Title and Guaranty Company paid Rinker Materials Corporation of Melbourne, Florida, $1,201.02 based on a claim of liens filed December 15, 1978, for materials consisting of concrete block, steel and miscellaneous items which were used on the McCammack property (Petitioner's Exhibit 6). Subsequent to the date of closing, January 4, 1979, liens amounting to approximately $2,761.62 have been filed against the McCammack property based on Respondent's failure to pay bills for labor and/or materials used in connection with the construction of the McCammacks' residence. These lien claims were filed against the McCammacks' property for a drilled well, installation of a pump and tank by Perry and Leighty, Inc., of Melbourne, Florida; two septic tanks, drains and sand supplied by Pence South Brevard Sewer and Septic Tank of Melbourne, Florida (Petitioner's Exhibits 7, 8 and 9).

   
   

5. On December 22, 1978, Respondent entered into a contract with Robert J. Greene to construct a residence for $30,500.00 in Palm Bay, Florida. Respondent filed an affidavit of no liens relative to the Greene property on January 10, 1979. Chelsea Title and Guaranty Company relied on this affidavit to close the Greene property transaction on January 10, 1979 (Petitioner's Exhibit 5). Respondent was paid thee entire contract price. On February 12, 1979, Pence South Brevard Sewer and Septic Tank filed a claim of lien in the amount of

   $1,015.36 for two septic tanks, drains and sand which had been furnished the Respondent for the property of Robert J. and Alice Greene of Palm Bay, Florida, on December 15, 1978 (Petitioner's Exhibits 10 and 11). Approximately $3,496.40

   was retained by Chelsea Title and Guaranty Company to satisfy outstanding recorded obligations on the date the Greene transaction closed (Petitioner's Exhibit 13).

   
   

6. On February 21, 1979, Respondent caused to be filed in the United States District Court of the Middle District of Florida, a Voluntary Petition for Bankruptcy for Ulbricht Construction, Inc. (Petitioner's Exhibit 2 Composite).

   
   

   CONCLUSIONS OF LAW

   
   

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

1. The authority of the Petitioner is derived from Part II, Chapter 468.112, Florida statutes. 2/

   
   

2. The parties were duly noticed pursuant to the notice provisions of Chapter 120, Florida Statutes.

   
   

3. Respondent, by receiving the full contract price for the property of Michael D. and Karen K. McCammack on January 4, 1979, and failing to pay materialmen and suppliers for materials and supplies furnished for the construction of the McCammack property, engaged in conduct constituting a diversion of funds in violation of Chapter 468.112(2)(e), Florida Statutes (1977).

   
   

4. Respondent, by receiving the full contract price for the construction of the residence for Robert J. and Alice Greene on January 10, 1979, and having failed to pay all materialmen and suppliers as indicated above, engaged in conduct which constitutes a diversion of funds in violation of Chapter 468.112(2)(e), Florida Statutes (1977).

   
   

5. By causing a Petition in Bankruptcy to be filed on behalf of Ulbricht Construction, Inc., the entity qualified by Respondent as the entity through which he would conduct his construction business, Respondent engaged in conduct violative of Chapter 468.112(7), Florida Statutes (1977).

   
   

6. Based on the foregoing, the Respondent has engaged in conduct amounting to a deliberate disregard of the laws of the State of Florida in violation of Chapter 468.112(2)(a), Florida Statutes (1977), Chapter 489.129(1)(d), Florida Statutes (1979).

RECOMMENDATION

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

RECOMMENDED:

That the Respondent's contractors licenses set forth hereinabove be REVOKED.

RECOMMENDED this 6th day of May, 1980, in Tallahassee, Florida.

JAMES E. BRADWELL, Hearing Officer Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 6th day of May, 1980.

ENDNOTES

1/ Attorney Kime only appeared specially at the hearing to voice objections thereto based on Respondent's claim that it was impossible for Respondent to properly defend against the charges herein due to the pendency of other court litigation. In this regard, a lotion for Continuance was filed with the undersigned based on an allegation that related court litigation had been initiated by Respondent which could impact on the decision herein. Said motion was considered by the undersigned and denied by Order dated March 6, 1980.

2/ Part II, Chapter 468.112, Florida Statutes (1977) is presentry codified as Chapter 489.129, Florida Statutes (1979).

3/ Presently Chapter 489.129(1)(h), Florida Statutes (1979). 4/ Presently Chapter 489.129(1)(h), Florida Statutes (1979).

5/ There is no corresponding provision to this section in the 1979 amendments to Chapter 468, Florida Statutes. however, the Board is authorized to investigate and in fact conducts inquiry into the financial responsibility of applicants/licensees. See Chapter 489.115(4), Florida Statutes (1979). Based thereon, and in view of the fact that the 1979 amendments did not digest the Board of jurisdiction to inquire into the financial wherewithal of its applicants, 1 submit that the Board is still authorized to discipline contractors whose financial records reflect that they may not be safely entrusted with the propert percent and funds of others. Cf. Sellars v. Florida Real Estate Commission, 380 So.2d 1052 at 1054 (1980).

COPIES FURNISHED:

Michael Egan, Esquire ROBERTS & EGAN, P.A.

Post Office Box 1386 Tallahassee, Florida 32301

Robert Clay Kime, Esquire

363 South County Road

Palm Beach, Florida 33480

Nancy Kelley Wittenberg, Secretary Department of Professional Regulation 2009 Apalachee Parkway

The Oakland Building Tallahassee, Florida 32301 J.

K. Linnan, Executive Director Florida Construction Industry

Licensing Board Post Office Box 2

Jacksonville, Florida 32201

Docket for Case No: 79-001971

Orders for Case No: 79-001971