STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
DEPARTMENT OF INSURANCE AND ) TREASURER, )
)
Petitioner, )
vs. ) CASE NO. 81-480
)
GEORGE S. EDISON, )
)
Respondent. )
)
RECOMMENDED ORDER
Pursuant to notice, a formal hearing was held before the Division of Administrative Hearings, by its duly designated Hearing Officer, DONALD R. ALEXANDER, on July 23, 1981, in Fort Lauderdale, Florida.
APPEARANCES
For Petitioner: David A. Yon, Esquire
428-A Larson Building Tallahassee, Florida 32301
For Respondent: J. Charles Shores, Jr., Esquire
310 Southeast 13th Street Tallahassee, Florida 33316
BACKGROUND
By Amended Administrative Complaint dated July 1, 1981, the Petitioner, Department of Insurance and Treasurer, has alleged that Respondent, George S. Edison, violated Chapters 626 and 627, Florida Statutes, and certain rules promulgated thereunder.1 In summary form, it is contended that (1) in March or April, 1979, Respondent solicited for sale and sold a life insurance policy to one Joseph J. Verdiglione; that no explanation was given to the buyer that his premium would increase substantially after the tenth year; that Respondent failed to provide a disclosure statement and notice concerning the replacement of life insurance to Verdiglione; that Respondent completed a disclosure statement and affixed Verdiglione's signature thereto without the buyer's knowledge; that Respondent returned the policy to the buyer with certain portions thereof obscured or crossed out; and that said acts constituted a violation of Sections 626.611(5), (7), (8), (9), and (13), 626.621(2), (6) and
(9), 627.410(1) and 627.460, Florida Statutes, and Rules 4-9.02. 4-9.05, 4- 24.04(3)(b), 4-24.04(3)(c) and 4-24.04(3)(d), Florida Administrative Code, and
on or about August or September, 1978, Respondent solicited an application for an sold to one Charles A. Clement a life insurance policy; that Respondent failed to tell Clement that the premium would substantially increase after the tenth year; that Respondent failed to provide the buyer with a disclosure statement or notice concerning replacement of life insurance; that Respondent intentionally obscured or crossed out certain portions of the policy returned to Clement; that Respondent had solicited and sold a Trans World Assurance Company
insurance policy to Clement without having been licensed to sell insurance on behalf of Trans World; and that such acts constituted a violation of Section 626.112(1), (2) and (4), 626.311(4), 626.611(5), (7), (8), and (9), 626.621(2),
(5), (6), (9) and (13), 626.9521, 628.410(1) and 627.460 Florida Statutes, and Rules 4-9.02, 4-9.05, 4-24.04(3)(b), 4-24.04(3)(c), and 4-24.04(3)(d), Florida
Administrative Code.
Respondent disputed the allegations of fact and requested a formal hearing pursuant to Section 120.57(1), Florida Statutes. The matter was transmitted to the Division of Administrative Hearings on March 2, 1981, with a request that a Hearing Officer be assigned to conduct a hearing. By Notice of Hearing dated April 17, 1981, a final hearing was scheduled for May 19, 1981, in Fort Lauderdale, Florida. By agreement of the parties, it was rescheduled to July 2, 1981, and the to July 23, 1981, at the same location.
At the final hearing, Petitioner called Joseph J. Verdiglione, Charles A. Clement, Thomas B. Phillips and Ellen Andrews as its witnesses and offered Petitioner's Exhibits 1-9, each of which was received into evidence. Respondent testified on his own behalf and called Rita Verdiglione, Charles Fairman and Margaret Fairman as his witnesses and offered Respondent's Exhibits 1-9, each of which was received into evidence.
The transcript of hearing was filed on September 2, 1981. Proposed findings of fact and conclusions of law were filed by the parties on September
14 and 15, 1981, and have been considered by the undersigned in the preparation of this Order. Proposed findings of fact not included in this Order were not considered relevant to the issues, were not supported by competent and substantial evidence or were considered immaterial to the results reached.
The issue herein is whether Respondent's ordinary life including disability agent and ordinary life agent license should be revoked or suspended, or whether other disciplinary action should be taken against him for alleged violations set forth in the Amended Administrative Complaint.
Based upon all of the evidence, the following facts are determined: FINDINGS OF FACT
At all times relevant hereto, Respondent George S. Edison, was licensed by Petitioner, Department of Insurance, as an ordinary life agent. He has held a license since 1977. During the time in which the alleged violations occurred, Respondent was employed by United Planning Services, Inc., Hollywood, Florida.
In March, 1978, Respondent solicited an application for and sold to one Joseph J. Verdiglione an Anchor National Life Insurance Company modified premium whole life policy with a face amount of $40,000 (Petitioner's Exhibit 1). The policy required a first year annual premium of $959.60, a premium of $503.60 per year for the second through the tenth years, and an annual premium of $2,015.60 thereafter unless conversion features were exercised. The actual policy was delivered to Verdiglione by Edison on or about May 1, 1979. When the policy was delivered, Edison, in the presence of Verdiglione, crossed out the upper right- hand column of numbers on page 3 of the policy, and wrote the words "Do not do". The marked-out column was entitled "Modified Premium Whole Life Annual Premium Thereafter" and contained premium requirements for the eleventh and following years of the policy if conversion features were not exercised. Edison also wrote the following words on the lower right-hand portion of the same page: "In tenth yr an use e & c. Follow projection take LEDT 17 yes to age 76. Maintain
same prem. outlay". Without Edison's knowledge or approval, a secretary in his office had previously placed a United Planning Services, Inc. sticker over the lower left-hand cornier of the same page. The sticker covered printed words and numbers which stated the annual total premiums due after the tenth year the policy was in force.
The handwritten markings on the policy were intended to advise Verdiglione to avail himself of a conversion feature in the policy after the tenth year in order to avoid an increase in premiums. Such advice was consistent with what Edison had earlier explained to Verdiglione, and was in accordance with Verdiglione's wish "to go the cheapest way" in terms of premium payments. The writings and sticker did not mislead or deceive Verdiglione. Before the application was made, Edison fully explained the type of policy being purchased, the conversion features offered therein, and the premium obligations under the plan.
Verdiglione later was visited by several unnamed agents from competing insurance firms. Verdiglione became confused from their advice and, believing that he had not purchased what he actually wanted, thereafter rescinded the policy and received a refund from Anchor. A letter was also sent to the Petitioner's Regional Director in Fort Lauderdale on November 28, 1979, bearing Verdiglione's signature and in which he complained that he had been misled by Edison (Respondent's Exhibit 4). However, Verdiglione specifically denied drafting, signing and mailing the letter and stated it had been prepared and sent by competitor insurance agents. Verdiglione stated he was perfectly satisfied in his dealings with Edison, was in no way misled, and had no complaint with Respondent.
The policy purchased by Verdiglione from Edison replaced an existing life insurance policy he had previously purchased from Prudential Insurance Company. Pursuant to Department requirements, both a basic policy disclosure statement and a notice to applicants regarding replacement of insurance were required to be furnished to the applicant for his review and signing. A document entitled "Comparison Statement" was submitted to Verdiglione by Edison and was signed by both individuals on March 27, 1979 (Petitioner's Exhibit 3).2 This document offered comparative information on both Verdiglione's existing policy as well as that which he purchased from Edison and furnished the type of information required by Department rule. Although at the time of the hearing Verdiglione stated he was not familiar with the document, he acknowledged that the signature affixed thereon was his own.
In September, 1978, Edison solicited an application for and sold and one Charles A. Clement an Anchor National Life Insurance Company modified premium whole life policy with a face amount of $33,000 annual premiums of
$363.65, annual premiums of $138.60 for two years through ten, and an annual premium of $816.42 thereafter unless conversion options were exercised. The actual policy was delivered to Clement by Edison on or about October 16, 1978. When the delivery was made, and in the presence of Clement, Edison crossed out the column of figures on the upper right-hand corner on page 3 and wrote the words "Do not do". On the bottom of the same page he wrote the following words: "At tenth yr ann. use exchange & conversion follow projection maintain same premium $23.25 mo. take L.E.D.T. 29 yrs to age 73.--Quarterly 72.48". Without Edison's knowledge or approval, a secretary in his office had placed a United Planning Services, Inc. sticker on the lower left-hand corner of the page which covered the premium schedule for the eleventh and following years.
The policy sold to Clement replaced an existing policy issued by Life of Georgia. Pursuant to Department requirements a basic policy disclosure statement and notice to applicants regarding replacement of insurance were presented by Edison to Clement for his review and signature.
On or about April 24, 1979, Clement signed an application for a flexible annuity policy to be issued by Trans World Assurance Company (Petitioner's Exhibit 5). Prior to that time Clement had telephoned Edison seeking advice on investing $2,500. Edison initially recommended he purchase an annuity policy from ITT Life Insurance Corporation which paid 7 3/4%. Edison subsequently advised he switch to Trans World which paid a higher interest rate.
The application was also signed by Charles Fairman, a licensed general agency and principal stockholder of United Planning Services, Inc., who held a license to sell on behalf of Trans World. At the time the application was signed by Clement and Fairman, Edison did not hold a license to sell insurance for Trans World. However, he had previously filed an application with that company for a licensing agreement. This agreement was received by Edison effective May 1, 1979 (Respondent's Exhibit 8). Edison then delivered the policy to Clement on May 2, 1979.
Although Edison filed an application with the Department for an additional license the exact date was never disclosed. In any event it was not later than May 1, 1979. The Department ultimately issued an additional license to Respondent for Trans World effective June 19, 1979 (Petitioner's Exhibit 7).
When the events above occurred, United Planning Services, Inc. was one of the top ten producing firms in the country for Anchor National Life Insurance Company. Edison individually ranked approximately 30th out of more than 16,000 Anchor agents in the United States in sales production. As a result of the Department's investigation, Anchor has terminated its relationship with both United and Edison and the volume of business for United Planning Services, Inc. has been substantially reduced.
Edison has been selling insurance since 1977. He has never been subject to any prior disciplinary action by the Department. His sales record is exemplary. Edison's employer, who is a master general agent, described him as being loyal, honest, and trustworthy and has recently permitted him to purchase a one-third interest in the business.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction of the subject matter and the parties thereto pursuant to Section 120.57(1), Florida Statutes.
In proceedings of this nature, where disciplinary action against a licensee is being sought, the evidence required to support such action is "substantially" greater than that required to support conventional forms of regulatory action. Bowling v. Department of Insurance, 394 So.2d 165 (Fla. 1st DCA 1981). That is to say, the proof offered by the Department to support its allegations must be commensurate with the potential penalty. Henderson Signs v. Florida Department of Transportation, 397 So.2d 768, 773 (Fla. 1st DCA 1981). With these standards in mind, the charges in Counts I and II will be examined in conjunction with the evidence presented by the parties.
COUNT I
In broad terms it is charged in Count I that Respondent (a) made misrepresentations to one Joseph Verdiglione to induce him to purchase a life insurance policy in contravention of Section 626.621(5), Florida Statutes, and Rule 4-9.02, Florida Administrative Code; (b) issued a statement misrepresenting the terms of the policy sold to Verdiglione in violation of Rule 4-9.05, Florida Administrative Code; (c) failed to furnish Verdiglione a disclosure statement and notice of replacement of life insurance at the time the application was taken as required by Rule 4-24.04(3)(b) Florida Administrative Code (d) failed to furnish Anchor National Life Insurance Company (the insurer) a completed disclosure statement as required by Rule 4-24.04(3)(c), Florida Administrative Code; (e) failed to have Verdiglione acknowledge receipt of a completed disclosure statement and notice of replacement of life insurance as required by Rule 4-24.04(3)(d), Florida Administrative Code; (f) modified or altered a provision of the policy in violation of Section 627.460, Florida Statutes; (g) delivered a policy not filed with and approved by the Department in contravention of Section 627.410(1), Florida Statutes; (h) violated a rule of the Department in violation of Section 626.621(2), Florida Statutes; (i) willfully violated a rule of the Department as proscribed by Section 626.611(13), Florida Statutes; (j) as a result of the violations in paragraphs (a), (f) and (g) has violated a provision of the insurance code in contravention of Section 626.621(2), supra; (k) as a result of the violations in paragraph (a), (f) and (g) has willfully violated a provision of the insurance code as prohibited by Section 626.611(13), supra; (1) violated the code of ethics for life agents in contravention of Section 626.621(9), Florida Statutes; (m) was willfully deceptive with regard to the sale of a life insurance policy in violation of Section 626.611(5), Florida Statutes; (n) has demonstrated a lack of fitness or trustworthiness in violation of Section 626.611(7), Florida Statutes; (o) engaged in fraudulent or dishonest practices in contravention of Section 626.611(9), Florida Statutes; (p) has demonstrated a lack of reasonable and adequate knowledge and technical competence to engage in the transactions authorized by his license in violation of Section 626.611(8), Florida Statutes; and (q) has shown himself to be a source of injury or loss to the public or detrimental to the public interest in violation of Section 626.621(6), Florida Statutes.
The charges in paragraphs (i), (k), (m), (n), (o) and (p) are of special significance, because if true, constitute grounds for compulsory suspension or revocation of Respondent's license. Bowling, supra at 170. The remaining charges provide grounds for discretionary suspension or revocation of the license, depending upon the severity of the offenses.
It is first charged in paragraph (a) that Edison ". . . [m]ade a misleading representation or incomplete or fraudulent comparison of . . . policies . . . for the purpose of inducing . . . (Verdiglione) . . . to . . . surrender . . . any insurance policy . . . (and) to take out a policy of insurance in another insurer." However, Verdiglione himself acknowledged that this was not the case and that Edison had fully and accurately explained all facts of his old and new policies before he committed himself to purchase the new Anchor policy. The evidence also contradicts the charges in paragraph (b) that an untrue statement concerning Verdiglione's policy was made or circulated by Edison. Accordingly, paragraphs (a) and (b) of Count I should be dismissed.3
There is some confusion in the record concerning the allegations that a disclosure statement and notice of replacement of life insurance were not submitted to the insured for his review and signature, and then submitted to the insurance company as required by Rule 4-24.04(3), supra. That Rule provides in pertinent part that each life insurance agent shall:
(3)(b) Present to the applicant, not later than at the time of taking the application, a completed "Disclosure Statement" signed by the agent and a "Notice to Applicants Regarding Replacement of Life Insurance" on forms substantially as described in Exhibits
A-1, A-2 and B and leave such forms with the applicant for his records:
(3)(c) Submit with the application to the insurer a copy of any proposal used and
the completed "Disclosure Statement" and the name of each insurer which issued any insurance being replaced;
(3)(d) Have the applicant acknowledge receipt of the completed "Disclosure Statement" and the "Notice to Applicants Regarding Replacement of Life Insurance."
Accordingly, under the terms of the Rule it is incumbent that an agent not only furnish the statement and notice to the insured at the time of taking the application, and to receive an acknowledgment of same from the insured, but also to give the insurer a copy of the completed statement. Further, the forms must be consistent with the format prescribed by Rule 4-24.07, Florida Administrative Code. The record reveals that a completed statement and notice were signed by the agent and insured on March 27, 1979, as required by the Rule. At the same time, it should be noted that the Department amended Rule 4-24.07 effective March 1, 1979, to slightly modify the format of the notice and disclosure statement previously used. Although the form signed by Edison and Verdiglione on March 27, 1979, was not in strict conformity with the new rule, it nonetheless furnished substantially the same type of information to the insured as was required under the new rule. Moreover, under the prevailing practice of Respondent and Anchor it was the responsibility of Anchor to prepare and supply its agents with forms that met Department requirements, and it is assumed Respondent was using the older forms until Anchor compiled and printed the newer ones. Accordingly, it is concluded that no violation of Rule 4-24.04 has occurred, and the charges in paragraphs (c), (d) and (e) should be dismissed.
Paragraphs (f) and (g) essentially charge that Respondent modified a provision of the Verdiglione insurance policy despite a prohibition against doing the same, and delivered said altered policy without having obtained Department approval to do so in contravention of Sections 627.460 and 627.410(1), Florida Statutes. The former section provides that:
There shall be a provision, at the option of the insurer, that no agent shall have the power to waive, change, or alter any of the terms or conditions of any policy; except that, at the option of the insurer, the terms or conditions may be changed by an
endorsement or rider signed by a duly authorized officer of the insurer.
The General Section of the policy issued to Verdiglione contained a provision entitled "Modification of Policy" and provided in part that "[n]o agent or person . . . has authority to change or modify this change or modify this policy or waive any of any provision by an agent is impermissible, the question presented here is whether certain handscript by Edison on page 3 of the policy constituted a change or modification of a provision within the meaning of those terms. It is concluded it did not. The first writing merely advised the insured to exercise an exchange and conversion provision in the policy after the tenth year in order to avoid the substantially higher premiums that would otherwise occur. The writing at the bottom of the page reiterated that advice and suggested that Verdiglione exercise the conversion option in the tenth year. Such notations cannot be construed as being a change or modification of the terms and conditions of the policy for they did not alter the rights, duties or liabilities of either the insurer or the insured. The charge in paragraph (g) stems from an alleged violation of Subsection 627.410(1), supra, which provides that no insurance policy may be delivered to an insured that has not been filed with and approved by the Department. But this charge is founded on the same incorrect premises--that the writings on the policy delivered to Verdiglione constituted a modification or change of its terms and conditions. For the foregoing reasons, it is concluded that the allegations in paragraphs (f) and
(g) are without merit and should be dismissed.
The charges in paragraphs (h)-(k) hinge on whether Respondent was guilty of the allegations in paragraphs (a)-(g).4 Having concluded that those charges are without merit, a similar conclusion must be reached regarding paragraphs (h)-(k), and this portion of Count I should accordingly be dismissed.
It is next charged in paragraph (1) that by making misrepresentations to Verdiglione, Edison has violated the code of ethics for life agents. However, the evidence belies this contention, for no misrepresentations occurred, and it is concluded that there was no violation of the code of ethics by Respondent.
The remaining charges in Count I (paragraphs (m)-(q)5 arise from the Verdiglione transaction and are dependent upon whether Edison deceived or misled the insured when soliciting and selling the policy. It having been previously concluded that no misrepresentation or deception was present in the solicitation and sale of the policy, the charges in paragraphs (m)-(q) should be dismissed.
COUNT II
In general terms it is charged in Count II that Edison (a) solicited an application and sold a life insurance policy to one Charles A. Clement under essentially the same circumstances as the sale to Verdiglione in Count I; and that for doing so Respondent is guilty of violating Sections 626.611(5), (7), (8) and (9), 626.621(2), (5), (6), (9) and (13), 627.410(1) and 627.460, Florida Statutes, and Rules 4-9.02, 4-9.05 and 4-24.04(3)(b), (c) and (d), Florida Administrative Code; (b) acted as an agent when not licensed as such in contravention of Subsection 626.112(1), Florida Statutes; (c) solicited or transacted as an agent for a kind of insurance to which he was not then licensed in violation of Subsection 626.112(2), Florida Statutes; (d) transacted a kind of insurance or class for which he did not have an agency appointment by an authorized insurer in violation of Subsection 626.311(4), Florida Statutes; (e) willfully used his license to circumvent provisions of the insurance code in
contravention of Subsection 626.611(4), Florida Statutes; and (f) engaged in an unfair or deceptive act or practice in violation of Section 626.9521, Florida Statutes.
The charge in paragraph (a) of Count II generally tracks the charge in Count I and involves the sale of a life insurance policy to one Charles A. Clement by Edison. Specifically, it is charged that misrepresentations and deception were used by Edison to induce Clement to purchase the policy, that the disclosure statement and notice of replacement of life insurance were not given to the applicant, and that Edison altered the policy by making certain marking on its third page. During the course of the hearing, the Department conceded that Edison had furnished the statement and notice to Clement as required by the Rule and that it had abandoned those charges. Petitioner then suggested that the forms may not have been completed, but it offered no affirmative evidence to support this charge or explain in what manner the form was incomplete. Accordingly, it is concluded that no violation relating to the statement and notice occurred. As to the charges that Edison misled or deceived Clement when making the sale, the evidence reveals that Clement was in no way misled or deceived by Edison's verbal representations or the handwritten notations on page
3 of the policy. Indeed, Clement himself acknowledged that such allegations were not true and that he was completely satisfied in his dealings with Edison. That being so, it must be concluded that the allegations in paragraph (a) are without merit and should be dismissed.6
The charges in paragraphs (b)-(f) all stem from an alleged sale by Edison to Clement of a Trans World Assurance Company (TWA) insurance policy prior to May 2, 1979. It is charged therein that Edison was not then licensed as an agent for TWA and that the solicitation and sale constituted various violations of Chapter 626 as set forth in paragraphs (b)-(f). The evidence reveals that Respondent had previously sold Clement a life insurance policy in the fall of 1978. At a later undisclosed time, Clement telephoned Edison and wished advice on how to invest approximately $2,500. Edison suggested a deferred annuity policy with ITT Life Insurance Corporation paying 7 3/4%.
After discovering that TWA was paying 9%, he suggested to Clement that he purchase a TWA policy in lieu of one from ITT. Edison had earlier applied for a licensing agreement with TWA but had not yet received the licensing agreement from the company. The Clement application was signed by Edison's general agent, Charles Fairman, who was authorized to represent TWA, on April 4, 1979. Armed with this agreement, he delivered a single premium deferred annuity policy to Clement on May 2, 1979. The record does not reveal the exact date when Edison submitted the necessary paperwork to the Department to obtain authorization to represent TWA but he testified it was earlier than May 1 because of common 2-4 month delays in processing such applications by the Department. In any event, the Department ultimately issued Edison a license to represent TWA effective June 19, 1979, or approximately 7 weeks after the Clement policy was delivered.
The Department contends that notwithstanding TWA's approval of Edison as an agent effective May 1, 1979, Edison was without authority to sell insurance on its behalf until on or about June 19, 1979, when that authority was officially registered with the Department, and that any activities on its behalf prior to that date were illegal. Subsection 626.112(1), supra, provides in part that:
No person shall . . . be, act as, or advertise or hold himself out to be, an insurance agent . . . unless he is then licensed as an agent . . . under a
currently effective license issued to such person by the department pursuant to this code.
Edison held a valid primary license which was issued in 1977 upon his initial qualification as a life agent. Subsection 626.331(3), Florida Statutes.
However, the code requires that "[a]dditional licenses . . . be issued to represent additional companies . . ." Subsection 626.331(3), supra. Thus, it was necessary for Edison to obtain an additional license to represent TWA. The appointment of Edison as an agent by TWA became effective on May 1, 1979, and obtain the appropriate license. The exact date the application was mailed not disclosed; however, the evidence persuades the undersigned to conclude that either the actual application was mailed in April, 1979, with the appointment mailed at some later date, or that both were mailed simultaneously no later than May 1, 1979.
At first blush it would appear that Edison was in violation of Subsection 626.112(1), supra, because the transaction occurred prior to him having a "currently effective license". This notion is supported by Subsection 626.361(2), Florida Statutes, which holds a license is not "effective" until the "date of issue". But whether this interpretation of the statutes was followed by the Department, and concomitant advise given to insurance agents, is questionable. Certainly there were no Department rules which crystallized this policy and afforded Edison, and others, the opportunity to conform their sales practices to this interpretation. Indeed, Edison himself indicated that what he had done was not out of the ordinary given the 2-4 month delay he frequently encountered in obtaining an additional license from the Department. It was his belief that upon the issuance of the licensing agreement by TWA on May 1, 1979, transactions on behalf of TWA were lawful, for once having received TWA's approval, the obtaining of an additional license was merely a ministerial function by the Department. In an effort to clarify this confusion and uncertainty, the Legislature enacted an amendment to the insurance code in 1980. Subsection 626.341(3), Florida Statutes (Supp. 1980) provides that:
A life agent with a license in force may solicit applications for policies of life insurance on behalf of an insurer with respect to which he is not a licensed life agent, unless
otherwise provided by contract, provided such agent submits an application for appointment as a life agent simultaneously with the submission to such insurer of the application for insurance solicited by him. However, no commissions shall be paid by such insurer to the agent until such time as an additional license with respect to such insurer has been issued
by the department to the agent pursuant to the provisions of Subsection (1). (Emphasis supplied)
If the Clement transaction had occurred subsequent to the change in the law, Edison would only have had to take the application from Clement and simultaneously apply for appointment as an agent on behalf of TWA in order to have made a lawful transaction. The fact that an additional "currently effective" license had not yet been applied for and issued by the Department
would be immaterial, and not render the solicitation and sale in violation of the law.7
Finally, in Count VIII of the petition, Petitioner challenges the penalty provision of Rule 7E-4.09 and 7E-4.25(11)(11), Florida Administrative Code. As previously indicated, Rule 7E-4.09(3), Florida Administrative Code, in addition to providing for denial revocation, or suspension of a license for violation of the rules of the Division, also provides for the imposition of ". .
. monetary fines not exceeding $200 . . . for each violation." In addition, Rule 7E-4.25(11)(11), Florida Administrative Code, provides that "[a]ny person breaching the provisions of this rule shall be subject to fine, suspension, or revocation of license. (Emphasis added).
The enactment of this amendment evidences an intent by Legislature (and Department) to clarity a previously confusing situation which may have prompted Edison, and others, to follow a course of action that they thought permissible. This, then, is not a case in which licensee discipline is sought for violation of an explicit statute or rule, or for an act tainted by standards which are commonly understood though only generally expressed by statute". Anheuser-Busch, Inc. v. Department of Business Regulation, 393 So.2d 1177, 1181 (Fla. 1st DCA 1981). Rather, the conduct in question is such that "the licensee likely would have conformed to any agency standard of which it had notice rather than incur the financial and other burdens of disciplinary action." Anheuser- Busch, Inc., supra at 1182; Bowling, supra at 172. Certainly, had Edison known of this interpretation, the entire transaction could have easily been handled by Fairman who held an additional license for TWA, and the disciplinary action surrounding the sale avoided. Here by reason of the generality of the statutes the conduct of Respondent was not predictably objectionable, and there is no record foundation to support the agency's conclusion that a violation of those statutes has occurred. Accordingly, it is concluded that Respondent is not guilty of violating Subsection 626.112(1), supra, and that the charge in paragraph (b) should be dismissed. Anheuser-Busch and Bowling, supra.
The charges in paragraphs (c) and (d) also stem from the TWA transaction and rest upon the allegation of the Department that the sale was in violation of the code. However, for the reasons just stated, these charges are without merit and should be dismissed.
Paragraph (e) contends that Edison willfully used his license to circumvent certain provisions of the insurance code. But there was insufficient evidence of a "substantial" nature to show that a willful violation of the code by Edison occurred. Bowling, supra. This is especially true since it has been previously found that no violations of the code occurred, and that all actions by Edison herein were made in good faith and in the belief that they were lawful and in the best interests of his clients. Accordingly, the allegation in paragraph (e) should be dismissed.
Finally, it is charged in Paragraph (f) that Edison "engaged in a trade or practice which is defined as an unfair or deceptive act or practice involving the business of insurance". Such contention is unavailing and should be dismissed.
Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that all charges in Counts I and II against Respondent be
DISMISSED.
DONE AND ENTERED this 24th day of September, 1981, in Tallahassee, Florida.
DONALD R. ALEXANDER
Hearing Officer
Division of Administrative Hearings Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32301 904/488-9675
Filed with the Clerk of the Division of Administrative Hearings this 24th day of September, 1981.
COPIES FURNISHED:
David A. Yon, Esquire 428-A Larson Building
Tallahassee, Florida 32301
J. Charles Shores, Esquire
310 Southeast 13th Street
Fort Lauderdale, Florida 33316
Mr. George Edison 2090 S.W. 29th Avenue
Fort Lauderdale, Florida 33312
| Issue Date | Proceedings |
|---|---|
| Oct. 30, 1990 | Final Order filed. |
| Sep. 24, 1981 | Recommended Order sent out. CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| Jan. 28, 1982 | Agency Final Order | |
| Sep. 24, 1981 | Recommended Order | All charges against life insurance agent dismissed. |
DEPARTMENT OF INSURANCE vs ALLAN BURTON CARMEL, 81-000480 (1981)
DEPARTMENT OF INSURANCE AND TREASURER vs. FRANK JOSEPH BRENNAN, 81-000480 (1981)
DEPARTMENT OF INSURANCE vs ACCELERATED BENEFITS CORPORATION, 81-000480 (1981)
DEPARTMENT OF FINANCIAL SERVICES vs THOMAS ANDREW MASCIARELLI, 81-000480 (1981)
