DEPARTMENT OF PROFESSIONAL ) REGULATION, CONSTRUCTION INDUSTRY ) LICENSING BOARD, )
vs. ) CASE NOS. 82-0720
THEODORE A. DYSART, )
Respondent. )
These matters came on for hearing in Miami, Florida, on June 20, 1983, July 21, 1983, and March 23, 1984, before the Division of Administrative Hearings and its duly appointed Hearing Officer, R. T. Carpenter. The parties were represented by:
These cases arose on Petitioner's Administrative Complaints charging Respondent with violations of Chapter 489, Florida Statutes (F.S.), in his capacity as a licensed general contractor and pool contractor.
Respondent is a licensed general contractor and pool contractor. He is employed by Sally Dysart, Inc., and is currently the qualifying contractor for that company. Additionally, Respondent has served as qualifier for ARK Swimming Pool Service, Inc.
On June 6, 1981, Sally Dysart, Inc., contracted with Theresa Pica to construct a swimming pool at her North Lauderdale residence. On June 9, 1981, Respondent obtained a permit from the City of North Lauderdale to construct the Pica pool. The permit indicated that ARK Swimming Pool Service, Inc., was the contractor.
The contract specified that the pool would measure 16 x 32 x 3 x 6 1/2 feet, with stainless steel walls. The contract allowed "minor variations in dimensions . . ." and provided that, "Dysart is authorized to use its discretion in making changes or additions if the customer is not immediately available."
The pool as installed was 8 feet rather than 6 1/2 feet deep, and the walls were of aluminum rather than stainless steel. These changes were not approved by Theresa Pica and she complained to Petitioner regarding these changes and other problems which are not relevant to the charges herein.
This was an 18 inch change in pool depth and could not be considered a minor variation in dimensions, nor could the change in materials be considered insignificant. Respondent should have, but did not, obtain the owner's concurrence before substituting the 8 foot aluminum pool for the 6 1/2 foot steel pool, which the contract called for. This installation was also held to be in violation of Broward County Ordinance Section 9-14(b)(9), by the local board having jurisdiction.
Respondent was not properly registered as the qualifying agent for Sally Dysart, Inc., at the time of this project. He was registered as the qualifier for Ark beginning in 1977, but his application to qualify Sally Dysart, Inc., was not received by Petitioner until November 1981 and not issued until December 1981. A Julius Kaplan was also a qualifier for Sally Dysart, Inc., but his application was not received by Petitioner until October 1981. Sally Dysart, Inc., was therefore not qualified by a licensed pool contractor at the time this company undertook the Pica project. The permit was improperly drawn on Ark Pool Service, Inc., by Respondent since Ark was not a party to the Pica contract.
Respondent demonstrated that the administrator for Sally Dysart, Inc., was attempting to secure a qualifier for this company between April and December 1981. Thus, while some effort had been made to qualify Sally Dysart, Inc., this had not been accomplished at the time the Pica project was undertaken.
Sally Dysart, Inc., contracted with James J. Mirrione to install a spa for him at his residence in Boca Raton. The permit was obtained by Respondent on behalf of Sally Dysart, Inc., on April 23, 1981. As noted above, Respondent was not a qualifier for Sally Dysart until December 1981.
No final inspection of the Mirrione installation was ever made. Respondent believed that officer personnel at Sally Dysart, Inc., had arranged for such inspection, but it was either not requested or requested but not performed.
On June 25, 1981, Warren Schober contracted with Sally Dysart, Inc., to construct a pool at his Miami residence. He negotiated the contract with a Milton Wolf who he understood to be the sales manager for Sally Dysart, Inc.
The project was completed, but Schober encountered problems with a defective light and leaks in the pool. The difficulties were eventually corrected and Schober is now satisfied with the installation.
In late August 1981, Milton Wolf agreed to sell Dr. Ronald Scott a swimming pool for $5,970. Scott made an initial payment of $3,970 to Milton Wolf by cashier's check dated September 8, 1981.
Scott believed he was dealing with Sally Dysart, Inc., since Wolf held himself out as a representative of that company. Although he had some reservations about making the check payable to Milton Wolf personally, he had contacted a Better Business Bureau to determine that Sally Dysart, Inc., was a
reputable company. Further, Wolf was available when he telephoned him at the Sally Dysart, Inc., offices.
Sally Dysart, Inc., later disclaimed the Wolf agreement but offered to honor it if Scott would turn over the balance due. However, Scott rejected this offer and it was later withdrawn. He did not receive the pool or return of his initial payment.
The evidence did not establish whether or not Sally Dysart, Inc., approved the contract for sale of the pool negotiated by Wolf. However, there was no construction contemplated and therefore no active involvement by Respondent in his capacity as construction supervisor.
On July 31, 1981, Milton Wolf, on behalf of Sally Dysart, Inc., contracted with Mr. William D. Black for the sale and installation of a swimming pool at the latter's Miami resident. By check dated August 28, 1981, Black made an initial payment of $4,585 to Wolf. Black left the payee portion of the check blank at Wolf's request on the representation that he would use a stamp to supply the Dysart firm name. Wolf later filled in his own name, cashed the check and absconded.
Black had no reason to distrust Wolf as he had communicated with Wolf at Sally Dysart, Inc., and had checked on the company through the Better Business Bureau. Wolf held himself out as sales manager and this was not repudiated by Sally Dysart, Inc., until after Wolf absconded.
Respondent obtained a permit for the Black project on October 13, 1981, and some of the initial approvals were made. However, by letter dated September 22, 1981, Sally Dysart, Inc. (by its president, Sally Dysart), advised Black that the company would attempt to complete the project only if he would pay the balance of all payments due. This letter also disclaimed responsibility for Wolf's representations.
In response, Black demanded that Sally Dysart, Inc., honor the contract and proposed that remaining payments be placed in escrow pending satisfactory completion. This proposal was rejected, and Black did not obtain the pool nor was his $4,585 "deposit" returned.
Respondent sought to establish that Milton Wolf was not authorized to act on behalf of Sally Dysart, Inc., but that he was merely present in the Dysart offices as a potential business partner. His contact with customers was purportedly limited to investigation of leads and company business potential. However, the testimony of a former Dysart employee established that Wolf did make sales and brought in cash receipts to the company prior to his defalcation. Therefore, regardless of any private understanding between Sally Dysart, Inc., and Milton Wolf, the latter was holding himself out to the public as a company representative with the knowledge and approval of Sally Dysart, Inc.
CONCLUSIONS OF LAW
Section 489.129, F.S., provides in part:
The board may revoke, suspend, or deny the issuance or renewal of the certificate or registration of a contractor or impose an a administrative fine not to exceed $1,000, place the contractor on probation, reprimand
or censure, a contractor if the is found guilty of any of the following acts:
* * *
Violation of chapter 455.
Willful or deliberate disregard and violation of the applicable building codes or laws of the state or of any municipalities or counties thereof.
Aiding or abetting any uncertified or unregistered person to evade any provision of this act.
Knowingly combining or conspiring with an uncertified or unregistered person by allowing one's certificate or registration to be used by any uncertified or unregistered person with intent to evade the provisions of this act. When a certificate holder or registrant allows his certificate or registration to be used by one or more companies without having any active participation in the operations, management, or control of said companies, such act constitutes prima facie evidence of an intent to evade the provisions of this act.
Acting in the capacity of a contractor under any certificate or registration issued hereunder except in the name of the certificate holder or registrant as set forth on the issued certificate or registration, or in accordance with the personnel of the certificate holder or registrant as set forth in the application for the certificate or registration, or as later changed as provided in this act.
Diversion of funds or property received for prosecution or completion of a specified construction project or operation when as a result of the diversion the contractor is or will be unable to fulfill the terms of his obligation or contract.
Disciplinary action by any municipality or county, which action shall be reviewed by the state board before the state board takes any disciplinary action of its own.
Failure in any material respect to comply with the provisions of this act.
Abandonment of a construction project in which the contractor is engaged or under contract as a contractor. A project is considered abandoned after 90 days if the contractor terminates said project without notification to the prospective owner and without just cause.
* * *
(m) Upon proof and continued evidence that the licensee is guilty of fraud or deceit or of gross negligence, incompetency, or misconduct in the practice of contracting.
Section 489.119, F.S., requires a licensed contractor to register as a corporate qualifier and obtain Petitioner's approval. "The business organization may not engage in contracting until a qualifying agent is employed." Subsection 489.119(3)(a), F.S. In constructing the Pica and Mirrione pools without obtaining the required registration for the contracting company, Sally Dysart, Inc., Respondent violated this provision. These acts and omissions also violated Subsections 489.129(1)(e), (f) and (g), F.S., which require Respondent to operate only in his registered name and refrain from aiding an unregistered entity in evading such provisions. Finally, these acts and omissions constitute misconduct in the practice of contracting in violation of Subsection 489.129(1)(m), F.S.
Respondent deliberately disregarded an applicable Broward County ordinance in the installation of the Pica pool and therefore violated Subsection 489.129(1)(d), F.S., quoted above. However, his failure to obtain a final inspection of the Mirrione installation was unintentional and cannot be considered a willful or deliberate disregard of an applicable building code. No violation involving the Schober contract was demonstrated. Therefore, charges pertaining to this project must be dismissed.
As qualifying agent for Sally Dysart, Inc., Respondent is responsible in his licensed capacity for all contracting activities and may not disclaim such responsibility by lack of knowledge.1 Subsection 489.119(2), F.S., requires the licensed contractor to demonstrate that he is "legally qualified to act for the business organization in all matters connected with its contracting business. . . ." However, these provisions do not set up a standard of absolute contractor liability2 where, as here, the company and its customers were victims of fraud.
The Scott and Black projects were disrupted as a result of such fraud. All diverted funds were lost through checks made payable to the perpetrator personally. Therefore, Sally Dysart, Inc., and Respondent have at least an arguable basis for their disclaimers of responsibility. Further, offers of project completion were made but the conditions were unacceptable to the customers. In view of these circumstances, Respondent cannot be held to have diverted funds or abandoned a construction project without just cause as charged by Petitioner.
Based on the foregoing, it is RECOMMENDED that Petitioner enter a Final Order suspending Respondent's contractor licenses for a period of ninety (90) days.
DONE AND ENTERED this 16th day of May, 1984, in Tallahassee, Florida.
R. T. CARPENTER Hearing Officer
Filed with the Clerk of the Division of Administrative Hearings this 16th day of May 1984.
1/ See Alles v. Department of Professional Regulation, 423 So.2d 624 (Fla. 5th DCA 1982).
2/ "Where statutes provide grounds for revocation of licenses, those provisions must be strictly construed and strictly followed because the statute is penal in nature." Bach v. Florida State Board of Dentistry, 378 So.2d 34, 36 (Fla. 1st DCA 1979).
Fred M. Roche, Secretary Department of Professional
