STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA HOME BUILDERS ) ASSOCIATION and BRUCE JOHNSON, )

)

Petitioner, )

)

vs. ) CASE NO. 81-2603RP

)

DEPARTMENT OF PROFESSIONAL )

REGULATION, CONSTRUCTION )

INDUSTRY LICENSING BOARD, )

)

Respondent. )

)

FINAL ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, William E. Williams, held a public hearing in this cause on December 14, 1981, at Tallahassee, Florida.

APPEARANCES

For Petitioners: Stephen W. Metz, Esquire

Post Office Box 1259 Tallahassee, Florida 32302

For Respondent: Patricia R. Gleason, Esquire

Department of Legal Affairs The Capitol

Tallahassee, Florida 32301

By Petition filed with the Division of Administrative Hearings on October 16, 1981, Petitioners, Florida Home Builders Association, Sylvia Jordan and Bruce Johnson, seek an administrative determination of the invalidity of proposed Rule 21E-15.05(2), Florida Administrative Code, ("the rule") pursuant to Section 120.54(4), Florida Statutes. Petitioners allege that Respondent, Construction Industry Licensing Board ("the Board") lacked statutory authority for adoption of the proposed rule, that the economic impact statement prepared in conjunction with the proposed rule is invalid, and that the rule is arbitrary and not based upon competent substantial evidence. The Board denies each of these contentions, and further asserts that Petitioners lack standing to challenge the rule.

Final hearing in this cause was scheduled for December 14, 1981, by Notice of Hearing dated October 30, 1981. At the final hearing, Petitioner called Burt German, John Koelemij, Peggy Browning, Joelene Strickland, Bruce Johnson and James Linnan as their witnesses. Petitioners offered Petitioners' Exhibits 1 through 5, each of which was received into evidence. Respondent called Burt German as its only witness. Respondent offered Respondent's Exhibits 1 through 9, which were received into evidence.

Upon request, the Hearing Officer took official notice of Chapter 21E-15, Florida Administrative Code, a copy of which was admitted into evidence and marked as Hearing Officer's Exhibit 1.

At the final hearing, Petitioner, Sylvia Jordan, filed a Notice of Voluntary Dismissal, and was thereupon dismissed as a party to this proceeding.

Both Petitioners and Respondent submitted proposed findings of fact for consideration by the Hearing Officer. To the extent that those proposed findings are not contained in this order, they have been rejected as either having been irrelevant to the issues presented for decision, or as not having been supported by evidence of record.

FINDINGS OF FACT

1. Petitioners in this proceeding challenge the validity of proposed Rule 21E-15.05(2) , Florida Administrative Code. The rule, as noted in the October 2, 1981, issue of the "Florida Administrative Weekly," provides as follows:

   
   

   An applicant shall also be required to submit proof that he can be bonded in the amount of

   $5000 by a surety corporation authorized to do business in the State of Florida and that said bond shall be currently in force and effect and executed subject to the following conditions:

   1. The terms of the bend shall be In a form acceptable to the Florida Construction Industry Licensing Board and shall remain in full force and effect if the applicant obtains a license as a certified contractor under the Chapter 489, Florida Statutes, and shall be furnished to the Florida Construction Industry Licensing Board before issuance of a license.

   2. The bend shall be subject to claim by any consumer sustaining monetary damages caused

by or arising out of acts of the contractor found by the Florida Construction Industry Licensing Board to be violations of subsections (d), (h) or (k) of Section 489.129(1), Florida Statutes, provided that:

1. The consumer is the owner or lessee of real property who has contracted with the certified contractor for the construction, improvement or alteration of a structure

   or structures on such real property, and the consumer has incurred monetary damages

   as a result of this contractual relationship.

2. Suit for such claim must be commenced within one year from the date of the finding of the Florida Construction Industry Licensing Board of a violation of subsections (d),

   or (k) of Section 489.129(1), Florida Statutes, on which such suit is based.

3. Suit for such claim must be based on acts of the contractor performed in his

   capacity as a certified contractor and not for any acts which he may have performed

   in the capacity of a registered contractor.

4. The amount of the claim paid by the bending company shall be based on a final judgment in a court of competent jurisdiction or an out of court settlement.

1. Subsequently, the proposed rule was amended to limit the period during which the required bond is to be in effect to two years from the date of issuance of a license. The proposed rule, as amended, was noticed in the November 25, 1981, issue of the "Florida Administrative Weekly."

   
   

2. The Board is the state agency charged by statute with determining the qualifications for licensure of persons seeking statewide certification to engage in the construction and home improvement industries in the State of Florida. Section 489.115(1), Florida Statutes. In making this determination, the Board is also authorized by statute to adopt rules defining "financial responsibility" in order to determine whether an applicant should be issued a certificate or registration. Section 489.115(4) , Florida Statutes.

   
   

3. Petitioner, Florida Home Builders Association, is a nonprofit trade association consisting of over twelve thousand members, including builders, developers, manufacturers, subcontractors and suppliers.

   
   

4. Petitioner, Bruce Johnson, has been licensed in Leon County as a residential contractor for aPPRDximately fourteen months. In order to obtain his residential contractor's license, he was required to pass a licensing examination. While so licensed, Mr. Johnson has completed one speculative residential home, which was subsequently sold. Mr. Johnson currently has no projects under construction. At final hearing, Mr. Johnson indicated that he would "potentially" like to take the state licensing examination, perhaps within the next two years. Petitioner Johnson has never applied to the Board for state certification in any category, but has been advised by a Tallahassee insurance agency representing several national bonding companies, that he would be ineligible for the type of bond required under the Board's proposed rule because his financial assets are currently insufficient to induce a bonding company to issue the required bond.

   
   

5. Prior to the final hearing in this cause, the Board filed a Motion to Dismiss for Lack of Jurisdiction, asserting that Petitioners each lacked "standing" to challenge the proposed rule. Because the issues raised in that motion involve a mixed question of law and fact, ruling was reserved until after the taking of testimony. In light of the fact that the Hearing Officer has determined that on the basis of the facts of record the Board's Motion to Dismiss is well taken, no findings are made concerning Petitioners' allegations that the Board lacks authority to adopt the rule, that the economic impact statement is invalid and that the rule is not based upon competent substantial evidence.

   
   

   CONCLUSIONS OF LAW

   
   

6. The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding. Section 120.54(4), Florida Statutes.

   
   

7. Section 120.54(4)(a), Florida Statutes, provides that:

   Any substantially affected person may seek an administrative determination of the invalidity of any proposed rule on the ground that the proposed rule is an invalid exercise of delegated

   legislative authority. (Emphasis added.)

   
   

8. A party challenging the validity of an existing or proposed rule bears the burden of proving standing to maintain such a challenge when, as here, standing is made an issue in the proceeding. Department of Health and Rehabilitative Services v. Alice P., 367 So.2d 1045, 1052 (Fla. 1st DCA 1979).

   
   

9. Petitioner, Florida Home Builders Association, Inc., is not a "substantially affected person" within the intent and meaning of Section 120.54(4), Florida Statutes, and therefore lacks standing to challenge the proposed rule involved in this proceeding. Department of Labor and Employment Security v. Florida Home Builders Association, 392 So.2d 21 (Fla. 1st DCA 1981); Florida Department of Education v. Florida Education Association/United, 378 So.2d 893 (Fla. 1st DCA 1979)

   
   

10. It is also concluded, based upon the rationale contained in Department of Offender Rehabilitation v. Jerry, 353 So.2d 1230 (Fla. 1st DCA 1978) , that Petitioner, Bruce Johnson, likewise lacks standing to challenge the validity of the Board's proposed rule. In Jerry, the Court found that a prison inmate who had been earlier subjected to, and had completed, disciplinary confinement under an existing rule, lacked standing to maintain such a rule challenge, absent a showing of injury accompanied by continuing adverse effects. In reaching its conclusion, the Court held that injury or threat of injury sufficient to clothe a petitioner with standing to challenge a rule pursuant to Chapter 120, Florida Statutes,". . . must be both real and immediate, not conjectural or hypothetical 353 So.2d at 1235. Thus, there must exist either some redressible injury or a showing of a real and immediate impact in order to confer standing on a party to maintain a rule challenge,

    
    

    for it is this requirement which

    gives a litigant a direct stake in the controversy and prevents the [administrative] process from becoming no more than a

    vehicle for the vindication of the value interests of concerned by-standers.

    353 So.2d at 1234.

    
    

11. Although the Jerry case involved a challenge to an existing rule, as opposed to a proposed rule, as here, it has been held that ". . . [t]here is no difference between the immediacy and reality necessary to confer standing where the proceeding is to challenge an existing rule or a proposed rule." Department of Health and Rehabilitative Services v. Alice P., 353 So.2d at 1052.

    
    

12. Petitioner Johnson is not now, nor has he ever been, licensed by the Board. This fact clearly distinguishes his situation from that of the licensee in 4245 Corporation, Mother's Lounge, Inc. v. Division of Beverage, 348 So.2d 934 (Fla. 1st DCA 1977) , where the Petitioner challenging an agency's proposed rule was, by virtue of merely holding a license, subject to the requirements of the proposed rule, if adopted. Further, Petitioner Johnson is not now engaged in any activity which he would be prohibited from engaging in by virtue of adoption of the proposed rule. Thus, the facts involved in this case are distinguishable from those in Professional Firefighters of Florida v. Department

of Health and Rehabilitative Services, 396 So.2d 1194 (Fla. 1st DCA 1981), where the parties challenging a proposed rule were then currently at work in a profession not previously subject to statewide regulation or licensing, and the challenged rule would have made their continued employment unlawful absent their compliance with licensing requirements. The mere facts that Petitioner Johnson might at some unspecified time in the future apply to the Board for licensure, and further that at the time he might so apply he might be unable, because of lack of assets, to post the necessary $5,000 bond, are so speculative and conjectural as to be insufficient to support a finding that he is so "substantially affected" as to enable him to challenge the Board's proposed rule. Accordingly, the relief sought by Petitioners should be, and the same is hereby DENIED.

DONE AND ORDERED this 15th day of March, 1982, at Tallahassee, Florida

WILLIAM E. WILLIAMS

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 15th day of March, 1982.

COPIES FURNISHED:

Stephen W. Metz, Esquire Post Office Box 1259 Tallahassee, Florida 32302

Patricia R. Gleason, Esquire Department of Legal Affairs The Capitol

Tallahassee, Florida 32301

Samuel Shorstein, Secretary Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

Carroll Webb, Executive Director Administrative Procedure Committee

120 Holland Building Tallahassee, Florida 32301

Liz Cloud, Chief

Bureau of Administrative Code Department of State

The Capitol, Room 1802 Tallahassee, Florida 32301

Docket for Case No: 81-002603RP

Orders for Case No: 81-002603RP