STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) CASE NO. 81-3074

)

PETER O. DALTON, )

)

Respondent. )

)

RECOMMENDED ORDER

A formal administrative hearing was conducted in this matter on March 25, 1982, in Jacksonville, Florida. The following appearances were entered: Salvatore A. Carpino, Tallahassee, Florida, appeared on behalf of the Petitioner, Department of Professional Regulation, Board of Real Estate; and Harry L. Shorstein, Jacksonville, Florida, appeared on behalf of the Respondent, Peter O. Dalton.

On or about October 8, 1981, Petitioner issued an Administrative Complaint seeking to suspend, revoke or take other disciplinary action against the Respondent as a licensed real estate broker. Respondent requested a formal administrative hearing, and Petitioner forwarded the matter to the office of the Division of Administrative Hearings for the assignment of a hearing officer and the scheduling of a hearing. Respondent filed a Motion to Dismiss the complaint which was denied by Order entered January 5, 1982. The final hearing was scheduled to be conducted as set out above.

At the final hearing Petitioner moved to amend its complaint by adding a reference to Section 475.25(1)(b) to the last sentence of the complaint. The Motion to Amend was granted without objection from Respondent. The parties stipulated that the allegations set out in paragraphs 1 through 6 of the Administrative Complaint could be accepted as true without the need for any further proof, except that Respondent did not stipulate that an answer he submitted to a Writ of Garnishment that had been filed against him was legally incorrect. Based upon this stipulation, Petitioner rested and called no witnesses. The Respondent testified as a witness on his own behalf and called Lon Brugh as his only additional witness. Hearing Officer's Exhibit 1 and Petitioner's Exhibit 1 were received into evidence. The parties waived their right to submit post-hearing legal memoranda or proposed recommended orders.

The issue in this matter is whether Respondent has violated provisions of Florida Statutes governing licensed real estate brokers and salesmen, and, if so, what disciplinary action should be taken against him.

FINDINGS OF FACT

1. Respondent is a real estate broker having been issued License Number 19454.

2. On or about the 30th day of November, 1979 a Final Judgment was entered in the cause of Brugh v. Alters, Case No. 79-324-SP in the County Court in and for Clay County in which the Plaintiff, Brugh, was awarded the sum of $929.05 plus costs of $34.00.

   
   

3. On or about the 11th day of April, 1980 the Respondent, Peter O. Dalton, was served with a Writ of Garnishment on behalf of Vanguard Realty. On or about April 28, 1980 the Respondent, Peter O. Dalton, filed an Answer of Garnishee in which Dalton alleged that as of the 11th day of April, 1980, and to and including April 28, 1980 that Peter O. Dalton did not have any "goods, monies, chattels or effects of the Defendant, Patricia C. Alters in his possession."

   
   

4. As a result of the Answer of Garnishee filed by Peter O. Dalton the County Court in and for Clay County entered a Final Judgment for the Garnishee, Peter O. Dalton and Vanguard Realty, and found that the Respondent Dalton did not hold any property of the Defendant Patricia Alters, and awarded Peter O. Dalton the sum of $10.00 costs and the sum of $10.00 attorney's fees.

   
   

5. On or about March 5, 1980, a contract was entered into by and between Thomas C. Davis as purchaser and Nancy P. Smith as seller. At this time Peter

   O. Dalton, the Respondent, was the broker for Vanguard Realty, Inc. The contract was consummated by a closing on April 11, 1980 and Patricia Alters, the Defendant in the aforementioned civil suit filed in Clay County, was a licensed salesperson in the employ of Vanguard Realty, Inc., and Peter O. Dalton. As a result of this sale closing, Patricia Alters was to receive a commission in the amount of $1,445.49. The commission was received by the Respondent Dalton and Vanguard Realty, Inc., on April 11, 1980. The Respondent Dalton's Answer of Garnishee alleged to the Court in Clay County that he did not possess any money of Patricia Alters's. In fact, this was not so.

   
   

6. The Respondent and Mr. Brugh, who caused the Writ of Garnishment to be served upon Respondent, had no business or other relationship except in connection with the garnishment matter. The two did not meet until approximately one week before the hearing.

   
   

7. When he was served with the Writ of Garnishment, Respondent immediately contacted the attorney who had represented him in the past. This is not the same attorney who represented Respondent at the hearing in this matter. The Respondent advised his attorney as to Patricia Alters's commission. Respondent then forwarded the Writ of Garnishment to his attorney. The attorney prepared an "Answer of Garnishee" for Respondent's signature. The answer was forwarded to the Respondent, who signed it. The answer was then filed in the County Court for Clay County, Florida. In the answer Respondent denied that he had at any relevant time any goods, monies, chattels or effects of Patricia C. Alters. Relying on the advice he received from his attorney, the Respondent believed the answer to be legally correct. He did not deliberately misrepresent any facts, but rather relied on advice of his attorney as to the legal propriety of his answer.

   
   

8. The County Court in Clay County, Florida, entered a final judgment in favor of the Respondent in the garnishment action. Patricia C. Alters had filed an "Affidavit of Exemption of Wages from Garnishment" with the court stating

   that she was the head of a family, and as such was exempt from garnishment. In its final judgment, the court held that the Respondent was not indebted to Alters because of her exemption from garnishment. Had the Respondent advised the court as to the commission that he held for Alters, Brugh would nonetheless have had no entitlement to recover any portion of that commission from Respondent because of Alters's exemption from garnishment.

   
   

   CONCLUSIONS OF LAW

   
   

9. 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.

   
   

10. Petitioner has alleged that the Respondent's Answer of Garnishee constituted violations of Sections 475.25(1)(b) and (d), Florida Statutes. Paragraph (b) provides that the Board of Real Estate can take disciplinary action against a licensee who has:

    
    

    (b) Been guilty of fraud, misrepresentation, 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. . .

    
    

    A fraudulent response to a writ of garnishment would constitute a violation of the paragraph. In order to constitute fraud or misrepresentation, however, it would be necessary that Respondent was aware of facts that he misstated or was culpably negligent in not being aware of the facts. In this case, the Respondent sought advice of counsel, and believed that he was filing a legally correct answer of garnishee. His conduct, therefore, does not constitute a violation of Section 475.25(1)(b), Florida Statutes.

    
    

11. Paragraph (d) of 475.25(1) provides that the Board may take disciplinary action against a licensee who has:

(d) Failed to account or deliver to any person, including a licensee under this chapter, at

the time which has been agreed upon or was required by law or, in the absence of a fixed time, upon demand of the person entitled to such accounting and delivery, any personal property such as money . . . which has come into his hands and which is not his property or which he is not in law or equity entitled to retain under the circumstances. . .

While this paragraph appears to relate primarily to security deposits taken in connection with real estate transactions, or to real estate commissions that the broker might hold for a salesman, the language is sufficiently broad to cover a circumstance where a licensee commits a fraud or misrepresentation in response to a writ of garnishment. Respondent's Answer of Garnishee, while incorrect, was not executed by the Respondent with any guilty knowledge. Respondent was entitled to rely upon advice of counsel as to what he was required to divulge in the garnishment proceeding. The answer, therefore, does not constitute a violation of Section 475.25(1)(d).

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, dismissing the Administrative Complaint filed against the Respondent, Peter O. Dalton.

RECOMMENDED this 8 day of April, 1982, in Tallahassee, Florida.

G. STEVEN PFEIFFER 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 8 day of April, 1982.

COPIES FURNISHED:

Salvatore A Carpino, Esquire Assistant General Counsel Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

Harry L. Shorstein, Esquire Shorstein & Romanello

605 Blackstone Building

Jacksonville, Florida 32202

Frederick H. Wilsen, Esquire Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

Samuel R. Shorstein, Secretary Department of Professional

Regulation

130 North Monroe Street Tallahassee, Florida 32301

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

Post Office Box 1900 Orlando, Florida 32802

Docket for Case No: 81-003074

Orders for Case No: 81-003074