STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STATE OF FLORIDA, DEPARTMENT OF ) PROFESSIONAL REGULATION, BOARD ) OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 81-2906

)

JAMES W. WEISS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated bearing Officer, James E. Bradwell, held a public hearing in this case on February 16, 1982, in Jacksonville, Florida. A transcript of the proceedings was received by the Division of Administrative Hearings on March 22; 1982.

APPEARANCES

For Petitioner: Bruce Lamb, Esquire

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

For Respondent: Herman S. Paul, Esquire

LEWIS, PAUL, ISAAC & CASTILLO, P.A.

1903 Independent Square

Jacksonville, Florida 32202 ISSUES

Whether or not the Respondent failed to account or deliver to persons with whom he was involved in a real estate transaction, a payment of approximately

$10,000.00 as required by an agreement whereunder Respondent received a piece of realty in violation of Chapter 475.25(1)(d), Florida Statutes (1979).

FINDINGS OF FACT

1. Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, the following relevant facts are found.

   
   

2. During times material herein, Respondent, James W. Weiss, was a registered real estate broker and holds License No. 0094382.

3. During March, 1980, Respondent, a real estate broker who purchases numerous properties under distress sales, learned that Frank and Evelyn Harvey were behind on mortgage payments on their home which is located at 11031 Duval Road, Jacksonville, Florida. Respondent offered to protect the Harvey's equity by taking their residence in trade for a home Respondent owned on Monaco Street in Jacksonville. Respondent considered the value of the Monaco Street residence to be approximately $25,000.00 and it had a mortgage balance of approximately

   $13,000.00 outstanding. Respondent and the Harvey's entered into an agreement which was prepared by Respondent's attorney and executed by the parties on March 27, 1980. (Petitioner's Exhibit No. 1) Under the terms of the agreement, the Harvey's were to exchange their property for the property owned by the Respondent located on Monaco Street. Additionally, Respondent received an option to purchase a lot which abutted the rear of the lot on which the Harvey's home was located. Subsequent to execution of the agreement, Evelyn Harvey, who was then divorced from Frank Harvey, examined the property owned by Respondent located on Monaco Street and decided that that house was not worth Respondent's stated value of $25,000.00 and that it required numerous repairs which she could not afford. After Ms. Harvey expressed her dissatisfaction to Respondent about the Monaco Street residence, Respondent agreed that he would pay the Harvey's an equity balance of approximately 10,000.00 instead of transferring the possession of the Monaco Street residence. 1/

   
   

4. During these discussions, Ms. Harvey represented to Respondent, and the evidence contained in the written agreements reflect that, according to Ms. Harvey, the outstanding mortgage balance remaining on the property the Harveys owned did not exceed $21,000.00. (See Petitioner's Exhibit 1)

   
   

5. On March 31, 1980, Respondent prepared a Warranty Deed whereunder the Harveys transferred their residence to the Respondent. Additionally, Respondent prepared an option agreement for the purchase of the rear lot which abutted the Harveys' residence. (Petitioner's Exhibit 2 and Respondent's Exhibit 1)

   
   

6. On March 31, 1980, Respondent ordered a title insurance binder from Chicago Title Insurance Company. Evidence reveals that when the Harveys transferred the Duval Road residence to Respondent, there was an outstanding mortgage dated June 27, 1973, from Frank and Evelyn Harvey to DAC Corporation which had an approximate balance of $21,400.00. Additionally, evidence revealed that the real property taxes for 1979 were due in the gross amount of $226.92. Evidence also indicates that there was an outstanding mortgage from the Harveys to City Consumer Services of Florida, Inc., in the approximate balance of

   $12,000.00. Finally, there was an unsatisfied final judgment filed July 30, 1974, from the Harveys in favor of M. A. Baer and Wayne Thompson d/b/a Physician's Service Bureau in the amount of $92.50 plus costs. Armed with these facts, Respondent confronted Ms. Harvey about these matters and the upshot of this confrontation is that Respondent advised Ms. Harvey that he was only interested in proceeding with the transaction if Ms. Harvey satisfied the outstanding delinquencies which exceeded $21,000.00, as agreed upon. Ms. Harvey indicated that she was unable to satisfy these outstanding obligations, whereupon Respondent offered to satisfy these obligations and pay Ms. Harvey any outstanding amounts which represented the difference in their earlier agreement. Respondent indicated to Ms. Harvey that the benefit to her in such a transaction would be that her credit history would not be adversely affected by a foreclosure proceeding which was threatened by DAC Corporation should the outstanding delinquencies not be satisfied by April 1, 1980. (See letter dated March 25, 1980, from DAC Corporation received as Respondent's Exhibit 9)

7. Respondent, having determined that the parties had reached an agreement, as reflected by the Warranty Deed executed by the parties on March 31, 1980, proceeded to pay the delinquent mortgage payments and back taxes on the subject property and recorded the Warranty Deed. (See Petitioner's Exhibit

   2 and Respondent's Exhibits 11 through 13)

   
   

8. On July 27, 1980, Respondent obtained a purchase contract from Arthur and Marilyn Hopkins. As a result of that purchase contract from the Hopkins, the transaction closed on September 12, 1980, and two Warranty Deeds transferring the property from the Harveys to Respondent and from Respondent to the Hopkins were recorded on September 17, 1980.

   
   

9. The Harveys and Hopkins, along with Respondent, were present at the subject closing. At the end of the closing, Ms. Harvey inquired of Respondent of the outstanding monies due her, whereupon Respondent told her that he would immediately remit to her monies due if she would follow him to his office.

   
   

10. At Respondent's office, Ms. Harvey was given three checks for the outstanding monies due her plus a check for certain pool and lawn equipment. (Respondent's Exhibits 3, 4, 5, 6 and 7)

    
    

11. While the Administrative Complaint alleges that the Respondent failed to nay the Harvey's approximately $10,000.00 as provided in an agreement between Respondent and the Harveys, the evidence revealed otherwise. In this regard, under the first written agreement entered between the parties, the Harveys represented that the outstanding mortgage from their residence approximated

    $21,000.00 whereas the outstanding mortgages due were in excess of $30,000.00. Evidence also reveals that Respondent indicated his willingness to proceed with the subject transaction if, and only if, the Harveys satisfied the outstanding obligations which represented amounts in excess of the $21,000.00. The Harveys were either unwilling or unable to satisfy these obligations. Noteworthy is the fact that Respondent, after learning of these outstanding obligations in excess of the claimed $21,000.00 mortgage balance by the Harveys, obtained a warranty deed to protect the monies which he found it necessary to expend to prevent the Harveys' residence from foreclosure proceedings. (See Warranty Deed dated and recorded from the Harveys to Respondent on March 31, 1980) It was also noted and the evidence reflects that while the Harveys contend that there was an agreement evidencing the fact that Respondent promised to pay Ms. Harvey approximately

    $10,000.00, no such agreement was produced and Petitioner amended the Administrative Complaint to reflect that there was no such agreement but rather that there were ongoing discussions in this regard. In this connection, the evidence tends to support Respondent's version which is in keeping with other documentary evidence and agreements and his credible testimony which was supportive of other record evidence. That being so, to the extent that Ms.

    Harvey's testimony differs from testimony offered by Respondent in these proceedings, Respondent's testimony is considered more credible and Ms. Harvey's testimony, to the extent that it differs from testimony offered by Respondent, is not credited. (Tr. pp. 39, 43, 44, 47 and 48) Ms. Harvey admits that she was "upset" about the transactions and could not remember the specifics of the various documents which she entered. Finally, an examination of the affidavit given by Ms. Harvey to Investigator Robert Maxwell on January 19, 1981, reflects that she told Respondent at the closing on September 12, 1980, that she would not sign any document unless she was paid before signing. (Page 2 of Respondent's Composite Exhibit No. 2) The evidence adduced during the hearing from witnesses Beardsley, Hopkins and Respondent, fails to support Ms. Harvey's claim in this regard.

    CONCLUSIONS OF LAW

    
    

12. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this action. Chapter 120, Florida Statutes.

    
    

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

    
    

14. The authority of the Petitioner is derived from Chapter 475, Florida Statutes (1979).

    
    

15. During times material, Respondent was a licensed real estate broker and as such is subject to the disciplinary contained in Chapter 475.25, Florida Statutes (1979).

Based on the foregoing Findings of Fact and Conclusions as found above, insufficient evidence was offered to establish that the Respondent failed to pay the Harveys $10,000.00 as alleged in paragraph 14 of the Administrative Complaint filed herein in violation of Chapter 475.25(1)(b), Florida Statutes (1979), or that Respondent failed to account or deliver to (the Harveys) money, funds, deposits, checks, drafts or other things of value which is not his property, in violation of Chapter 475.25(1)(d) , Florida Statutes (1979), as alleged. It is, therefore,

RECOMMENDED

1. That the Administrative Complaint filed herein be DISMISSED. RECOMMENDED this 5th day of May, 1982, 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 5th of May, 1982.

ENDNOTE

1/ In this regard, petitioner's counsel amended the Administrative Complaint filed herein on October 30, 1981, to reflect, in paragraphs 7 and 8, that there was not an agreement between the parties but rather there was "merely a discussion" as to the exchange of equities from Respondent to the Harvey's.

COPIES FURNISHED:

Bruce D. Lamb, Esquire Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

Herman S. Paul, Esquire 1903 Independent Square

Jacksonville, Florida 32202

Frederick H. Wilsen, Esquire Assistant General Counsel Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

C. B. Stafford, Executive Director Board of Real Estate

Department of Professional Regulation

Post Office Box 1900 Orlando, Florida 32802

Samuel Shorstein, Secretary Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

Docket for Case No: 81-002906

Orders for Case No: 81-002906