STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL )

REGULATION, BOARD OF REAL )

ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 81-1911

)

JANELL M. EISLER, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal administrative hearing was conducted in this matter on October 20, 1981, in Fort Walton Beach, Florida. The following appearances were entered:

APPEARANCES

For Petitioner: J. Riley Davis

Tallahassee, Florida

For Respondent: George C. Cox

Department of Professional Regulation Board of Real Estate

Fort Walton Beach, Florida

On or about July 13, 1951, the Petitioner issued an Administrative Complaint against the Respondent, Janell Eisler. The Respondent requested a formal hearing, and on July 31, 1951, the file was forwarded to the office of the Division of Administrative Hearings for the assignment of a Hearing Officer and the scheduling of a hearing. The hearing was scheduled to be conducted as set out above by notice dated August 31, 1951.

At the final hearing, the Petitioner called the following witnesses: Linda Ann Lyons, a resident of Fort Walton Beach; Jack Drasko, the manager of the Okaloosa County office of the Farmers Home Loan Administration; and Jack Piediscalzi, a resident of Okaloosa County. The Respondent testified as a witness on her own behalf. Petitioner's Exhibits 1 through 8 and Respondent's Exhibits 1 through 3 were offered into evidence and were received. In accordance with a schedule that was arranged at the hearing, the parties have submitted post-hearing legal memoranda.

The issues in this proceeding are whether the Respondent has violated the provisions of Section 475.25(1)(b), Florida Statutes, in connection with her serving as a real estate agent in a property transaction involving the sale of property owned by Jack Piediscalzi to a Mr. and Mrs. Lyons; and, if she is found to have violated the statute, the appropriate penalty that should be imposed.

FINDINGS OF FACT

1. The Respondent has at all times material to this matter been licensed by the Board of Real Estate as a real estate broker-salesman. For approximately the past year, she has been employed as a broker-salesman with Century 21 Realtors in Fort Walton Beach. Previously, for a period of approximately 18 months, she was employed with Kruse Realty, Fort Walton Beach, Florida, in the same capacity.

   
   

2. During November, 1979, Mr. and Mrs. L. C. Lyons visited Kruse Realty. The Lyonses were seeking to purchase a lot upon which they could build a house. They were introduced to the Respondent. The Lyonses advised the Respondent that they had been approved for a loan by the Farmers Home Loan Administration (FHLA) for the financing of construction. They advised the Respondent that they would be able to spend only $6,000 for a lot and that the property would need to qualify for FHLA financing. The Respondent told the Lyonses that she had lots available that had been approved for FHLA loans. One of them was located in Wynn Haven Beach, and the other was owned by a Mr. Jack Piediscalzi. The Lyonses visited the Wynn Haven Beach property and decided to purchase a lot. This resulted in a contract for sale being signed by the Lyonses. The Lyonses specifically requested that the contract be made contingent upon their securing financing from FHLA. After the Lyonses executed the contract, Mrs. Lyons' father visited the lot. He observed some low-lying areas that he felt would cause building problems. Mrs. Lyons' father also visited the Piediscalzi property and urged that it would provide a better building site. The Lyonses decided to follow this advice, and they asked the Respondent if they could cancel their contract to purchase the Wynn Haven Beach property, and purchase one of the Piediscaizi lots. The Respondent requested that the Wynn Haven Beach property owner cancel the contract, which he did. Thereafter, the Lyonses entered into a contract to purchase a lot from Mr. Piediscalzi. The contract was executed on November 19, 1973. The Lyonses advised Respondent that they would pay for the lot with cash, but that they would be financing home construction through the FHLA loan. They inquired as to whether the contract should be made contingent upon FHLA approval. The Respondent advised the Lyonses that such a contingency clause would not be necessary because FHLA had already approved loans for construction of houses on the Piediscalzi lots.

   
   

3. The day after they executed the contract to purchase one of the Piediscalzi lots, the Lyonses presented a loan approval package to FHLA. The FHLA representative immediately advised the Lyonses that the property would not qualify for FHLA financing because the road on which the lot fronted was merely an easement, not a county road as required by FHLA regulations. The FHLA representative advised the Lyonses that they were the first people to present a proposal for FHLA financing of one of the Piediscalzi lots. Mrs. Lyons called the Respondent later that same day. The Respondent's response was, "Well honey, what are you going to do with two lots?" The Respondent indicated that she would speak to her employer. Later, Mrs. Lyons spoke to Mr. Chamberlin, a real estate salesman who is also employed at Kruse Realty. Mr. Chamberlin advised that FHLA financing could be secured and that he would call her back within three days.

   He did not call her back in three days, and Mrs. Lyons contacted him. He advised that the property had not been approved, but that he would take steps to accomplish it. Mrs. Lyons also spoke to Mr. Kruse, the owner of Kruse Realty.

   Time was critical to the Lyonses because their FHLA loan package needed to be approved before available loan funds were distributed to other qualified purchasers. The steps that would need to be taken to secure FHLA financing were never accomplished, and the Lyonses did not secure the financing that they were seeking. Kruse Realty did not offer to compensate the Lyonses in any manner.

   Mrs. Lyons ultimately turned the property over to her father, who sold it. Mrs. Lyons filed a complaint with the Board of Real Estate, and with the Fort Walton Beach Board of Realtors.

   
   

4. Mr. Chamberlin from Kruse Realty contacted Jack Piediscalzi sometime prior to November, 1979, about the prospects of Mr. Piediscalzi subdividing and selling his property. Mr. Piediscalzi decided that he would like to sell the property in parcels, and he signed an exclusive contract with Kruse Realty to handle the sales. Mr. Piediscalzi left details of dividing the property to Kruse Realty. Kruse Realty decided to sell the property through "meets and bounds sales" rather than by subdividing the property into lots as required by local planning and zoning regulations. A road was constructed through the property, and efforts were made to dedicate the road to Okaloosa County. The County did not, however, accept the road. Mr. Piediscalzi dealt primarily with Mr. Chamberlin at Kruse Realty. He did not deal directly with the Respondent.

   
   

5. The Respondent was advised by Mr. Chamberlin and Mr. Kruse that they had talked to personnel at FHLA and that the property would qualify for FHLA loans. The Respondent saw two building permits that had been issued for lots on the property. The Respondent inquired of Mr. Kruse whether the property met local subdivision requirements, but she was assured that because it was being sold by "meets and bounds," it was not within subdivision requirements. The Piediscalzi-Lyons transaction was the first transaction in which the Respondent had dealt with an FHLA loan. The Respondent did not know specific FHLA requirements. She was not aware that the road through the Piediscalzi property had not been dedicated to Okaloosa County, nor that such dedication was required.

   
   

6. The Respondent ceased dealing with the Lyonses after they advised her that FHLA had not approved their loan. Thereafter, the Lyonses dealt with Mr. Chamberlin and Mr. Kruse. The Respondent sought to cancel the Lyons-Piediscalzi contract, and she returned the $240 commission that she had received for the sale to Kruse Realty in January, 1980. She sought to get Kruse Realty to buy the property back, and she was willing to by up to one-third of it. Her employer was not, however, willing to purchase the property, nor to rescind the contract or refund commissions.

   
   

   CONCLUSIONS OF LAW

   
   

7. The division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding. Sections 120.57(1), 120.60, Florida Statutes.

   
   

8. Section 475.25(1)(b) , Florida Statutes, provides that the Board of Real Estate may suspend or revoke a license, or impose an administrative fine if it finds that a licensee has:

   
   

   Been guilty of fraud, misrepresenta tion, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction in this state or any other state, nation, or territory

9. The Respondent's conduct does not constitute misrepresentations, concealment, or fraud. The Respondent did make false statements to the Lyonses in connection with the Piediscalzi-Lyons transaction. She advised the Lyonses that the lot they were purchasing would qualify for FHLA financing, and that other lots on the property had also qualified. These statements were not true. The Respondent made the statements in reliance upon information supplied to her by a fellow employee at Kruse Realty and by her employer. Making false statements under these circumstances cannot constitute fraud, misrepresentation, concealment, or the like because a necessary element of such conduct is knowledge of falsity. The Respondent was, however, guilty of culpable negligence in making the statements. The Respondent had never arranged FHLA financing prior to this transaction, yet she took no steps to assure herself of what FHLA required, and therefore whether the Piediscalzi lots would qualify for FHLA loans.

   
   

10. When a real estate broker or salesman makes representations to members of the general public respecting real estate matters, members of the public are entitled to rely upon the information. It is therefore incumbent upon the real estate salesman or broker to assure herself that statements she is making are in fact true. Since the Respondent took no steps to assure herself of the accuracy of the statements she was making beyond inquiring of fellow workers, she is guilty of culpable negligence.

    
    

11. In considering an appropriate penalty to be imposed upon the Respondent, it is appropriate that consideration be given to the fact that the untrue statements were made negligently, but not intentionally; that Respondent did not profit from the transaction, since she returned her portion of the commission; and that the Respondent has not been the subject of other disciplinary proceedings.

RECOMMENDED ORDER

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

RECOMMENDED:

That a final order be entered by the Department of Professional Regulation, Board of Real Estate, finding the Respondent, Janell Eisler, guilty of culpable negligence in connection with the Piediscalzi-Lyons transaction; suspending the Respondent's license to practice as a real estate broker- salesman in Florida for a period of 30 days; and imposing a fine of $250 upon the Respondent.

RECOMMENDED this 30th day of November, 1981, in Tallahassee, Florida.

G. STEVEN PFEIFFER Hearing Officer

Division of Administrative Hearings Department of Administration

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 30th day of November, 1981.

COPIES FURNISHED:

J. Riley Davis, Esquire Taylor, Brion, Buker & Greene Post Office Box 1796 Tallahassee, Florida 32302

James H. Gillis, Esquire Assistant General Counsel Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

George C. Cox, Esquire Post Office Box 1087

Fort Walton Beach, Florida 32549

Mr. Samuel R. Shorstein Secretary, Department of

Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

Mr. Carlos B. Stafford Executive Director Board of Real Estate

Department of Professional Regulation

Post Office Box 1900 Orlando, Florida 32802

Docket for Case No: 81-001911

Orders for Case No: 81-001911