vs. ) CASE NO. 82-2335
GERALD B. NATELSON, )
Respondent. )
Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, SHARYN L. SMITH, held a formal hearing in this case on February 10, 1983, in Miami, Florida. The following appearances were entered:
For Petitioner: Curtis A. Billingsley, Esquire
For Respondent: Richard A. Barnett, Esquire
The issue for determination at the final hearing was whether the Respondent Gerald B. Natelson's ordinary life, including disability agent, insurance license should be revoked, suspended or otherwise disciplined based on the Respondent's plea of guilty in the United States District Court, Southern District of Florida, and conviction of Sections 841(a)(1) and 846 Title 21, USC, by knowingly conspiring with others to distribute and to possess with intent to distribute marijuana (cannabis).
At the final hearing, Jose Fanelo, president of Universal Casualty Insurance Company, and Les Lloyd, regional investigator for the Department of Insurance, testified for the Respondent Natelson. Petitioner's Exhibits 1 and 2 and Respondent's Exhibits 1-15 were offered and admitted into evidence.
Proposed Recommended Orders have been submitted by the parties and considered by the Hearing Officer. To the extent that the proposed findings submitted by the parties are not reflected in this Order, they are rejected as being not supported by competent and substantial evidence or as being irrelevant to the issues determined here.
On August 6, 1980, the Respondent Gerald B. Natelson, was charged in the United States District Court, Eastern District of Missouri, with violating Sections 841(a)(1) and 846, Title 21, USC, by knowingly and willingly, combining, conspiring, confederating and agreeing with others to distribute and possess with intent to distribute, marijuana, methaqualone and hashish, Schedule I and II controlled substances.
The Respondent Natelson pled guilty to violating Sections 841(a)(1) and 846, Title 21, USC, as charged in Count I of the Indictment, by knowingly conspiring with others to distribute and to possess with intent to distribute marijuana. The amount or quantity of marijuana which was involved in the conspiracy set forth in Count I, is not identified in the Indictment, the Judgment and Probation/Commitment Order entered December 22, 1980, or Judge Aronovitz's Order Granting Motion to Vacate, Set Aside or Correct Sentence, and Granting Petition for Writ of Habeas Corpus in Natelson v. United States, Case No. 82-542 SMA, entered May 10, 1982. The Indictment, at paragraphs 12, 14 and 22, sets forth the Respondent's involvement in the conspiracy, which consisted of meeting in Hollywood and Fort Lauderdale, Florida, on April 1 and 4, 1979, and Phoenix, Arizona, on June 1, 1979, with specifically named co-conspirators.
Jose Fanelo, president of Universal Casualty Insurance Company and formerly regional director for the Department of Insurance, and Les Lloyd, regional investigator for the Department of Insurance, established that the Respondent had been a fit and trustworthy insurance agent. Additionally, the Respondent submitted various documents, identified as Respondent's Exhibits 2- 13, which support the opinions expressed by Fanelo and Lloyd that the Respondent is a fit and trustworthy insurance agent.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties and subject matter of this dispute. Section 120.57(1), Florida Statutes.
By Administrative Complaint dated July 8, 1982, the Respondent Natelson was charged with violating Sections 626.611(7), 626.611(14) and 626.621(8), Florida Statutes. Section 626.611(7), Florida Statutes, requires the Department of Insurance to, inter alia, suspend or revoke the license of an agent found to have a demonstrated lack of fitness or trustworthiness to engage in the business of insurance. Section 626.611(14), Florida Statutes, requires the Department to, inter alia, suspend or revoke the license of an agent found guilty of, or pled guilty to, a felony in this state or any other state which involves moral turpitude. Section 626.621, Florida Statutes, authorizes the department to, in its discretion, inter alia, revoke or suspend the license of any agent found guilty of, or pled guilty to, a felony in this state or any other state.
Both Sections 626.611(14) and 626.621(8), Florida Statutes, empower the department to take action against an agent found guilty of a felony in this state or any other state. The position of the Petitioner is that these statutes were intended to be applied geographically and, therefore, the Respondent, who was convicted of a federal felony which was committed in the State of Maryland, is subject to the statutes prohibitions. 1/ Conversely, the Respondent asserts that the statutes clearly encompass only state felonies, do not specifically refer to federal convictions and, accordingly, do not authorize the instant proceeding.
This case is complicated not only by the statutes, which are susceptible to both interpretations urged by the parties, but also by case law which has limited the authority of the Legislature to utilize the term "felony" in the context of disciplinary and other proceedings.
The Florida Constitution and Chapter 626, Florida Statutes
In the leading case, Duggar v. State, 43 So.2d 860 (Fla. 1949), the Supreme Court held that Duggar's conviction was not vitiated by the service on his jury of two persons who had been convicted of federal liquor law felonies. The statute in question, Section 40.01, Florida Statutes (1941), provided that "... no person who shall have been convicted of bribery, forgery, perjury or larceny, or any felony, unless restored their civil rights, shall be qualified to serve as a juror." (e.s) In so holding, the Court construed the statutory term "any felony" in conjunction with Article XVI, Section 25, Florida Constitution (1885), which required the term felony to be construed wherever it occurred in the Constitution or laws of the State, as any criminal offense punishable by death or imprisonment in the state penitentiary. Presumably, since the federal crimes for which the jurors were convicted could not have resulted in imprisonment in a Florida penitentiary, they were found not to be "felons" as that term was used in Section 40.01, Florida Statutes. Duggar was decided only two years after In re Weathers, 31 So.2d 543 (Fla. 1947), in which the Court concluded that Weathers, who was a licensed physician convicted in federal court in Jacksonville, Florida, of mailing non-mailable material, could not be disciplined because the federal crime for which he was convicted was not a felony under the laws of Florida. 2/ Further, neither a constitutional objection nor Article XVI, Section 25, Florida Constitution (1885), was discussed in Weathers.
In 1959, the Legislature began regulating insurance agents and procedures. See Chapter 59-205, Laws of Florida. At Sections 240-241, Chapter 59-205, the Department was authorized to take disciplinary proceedings against an agent for, inter alia, conviction of a felony. Based on the Duggar decision, the Legislature's use of this particular language limited insurance disciplinary proceedings involving convicted felons to those persons convicted of any crime punishable with death or imprisonment in a Florida state penitentiary. By constitutional construction, the vast majority of federal felonies were, therefore, excluded.
In 1968, a new state constitution was adopted which amended the prior provision concerning felonies, Article XVI, Section 25, and provided that:
The term "felony" as used herein and
in the laws of this state shall mean any criminal offense that is punishable under the laws of this state, or that would be punishable if committed in this state by death or by imprisonment in the state penitentiary. (e.s) Article X, Section 10, Florida Constitution (1968)
The emphasized language was added to broaden the 1885 Constitution so that, for example, federal offenses could be constitutionally considered if such offenses would have been felonies if committed in Florida.
The Legislature amended the insurance code in 1971 and struck the subsections concerning "... conviction of a felony" and added the language which presently exists. See Sections 12-13, Chapter 71-86, Laws of Florida.
Subsequent to the adoption of Article X, Section 10, and prior to the 1971 Amendment, the term "conviction of a felony" as used in the then existing insurance code, would presumably have been interpreted as including "... Florida felonies and those non-Florida offenses which 'if committed in this state' would be Florida felonies," since Article X, Section 10, has been characterized as a "compelling instrument" of statutory construction. See Rotstein v. Department of Professional Regulation, 397 So.2d 308,309 (Fla. 1st DCA 1981). However, by amending the statutes in question in 1971 and adding the phrase "... in this state or any other state," to the language concerning felonies, the question next arises as to exactly what the Legislature intended by adding this phrase to the existing law.
It is a long-standing rule of statutory construction that once a statute is amended, there is a presumption that the Legislature intended the statute to have a meaning different than that given before the amendment. See Carlile v. Game and Fresh Water Fish Commission, 354 So.2d 362 (Fla. 1977). Since the Legislature could not constitutionally expand the term "felony" beyond the definition at Article X, Section 10, the amendment must have either limited or clarified existing law.
There is no evidence in the title of Chapter 71-86, Laws of Florida, that the Legislature intended to limit crimes for which disciplinary action could be imposed. Indeed, the class of actionable felony crimes was expanded to include those for which a judgment of conviction was not entered. However, if the Legislature had intended to clarify the statutes by inserting the phrase "in this state or any other state," such effort was not entirely successful. Had the Legislature included the word "committed" in the amendment, such amendment would have tracked the language contained in Article X, Section 10, and the meaning, although redundant, would be clear.
Assuming that the Legislature intended the phrase "in this state or any other state," to clarify rather than limit or expand existing law, Article X, Section 10, requires an analysis of the federal conviction to determine whether such an offense would constitute a felony under Florida law.
Equating federal conspiracy laws with state felonies
In Shields v. Smith, 404 So.2d 1106 (Fla. 1st DCA 1981), the court was confronted with a similar problem concerning a federal defendant convicted of violating the Hobbs Act, 18 USC, Section 1951 (1976). The jury returned general verdicts of guilt as to three counts of the indictment, one dealing with conspiracy and the remaining two with attempted bribery. The court found that acts for which Shields was convicted, as described in the charging instrument, would support a Florida conviction of a Chapter 838 felony, namely, requesting or soliciting unlawful compensation for official behavior. See Section 838.016(1), Florida Statutes. Shields' conspiracy conviction was disregarded, however, because the federal crime of conspiracy as interpreted by the federal courts under the Hobbs Act, lacked essential elements of Chapter 838 felonies; the court noting that the general statute prescribing conspiracy to commit an offense against the United States, 18 USC, Section 371 (1976), and accompanying case law require only proof of an agreement between two or more persons to
commit the specific offense and an overt act in furtherance of the conspiracy. See Shields, supra at 1110, n.3.
Turning to the instant case, the state statute which most closely approximates the federal act to which the Respondent pled nolo contendere, 21 USC, Sections 841(a)(1) and 846, is Section 893.13(1)(a)(2), Florida Statutes, which provides:
(1)(a) Except as authorized by this chapter and chapter 500, it is unlawful for any per- son to sell, manufacture, or deliver, or possess with intent to sell, manufacture, or deliver, a controlled substance. Any person who violates this provision with respect to:
* * *
2. A controlled substance named or de- scribed in s.893.03(1)(c), (2)(c), (3), 3/ or (4) is guilty of a felony of the third degree, punishable as provided in s.775.082, s. 775.083, or s. 775.084.
Section 777.04, Florida Statutes, pertaining to attempts, solicitation and conspiracy, generally, provides in pertinent part:
Whoever shall agree, conspire, com- bine, or confederate with another person or persons to commit any offense commits the of- fense of criminal conspiracy and shall, when no express provision is made by law for the punishment of such conspiracy, be punished as provided in subsection (4).
Whoever commits the offense of criminal attempt, criminal solicitation, or criminal conspiracy shall be punished as follows:
* * *
(d) If the offense attempted, solicited, or conspired to is a felony of the third
degree, the person convicted shall be guilty of a misdemeanor of the first degree, punish- able as provided in s. 775.082, s. 775.083, or s. 775.084.
Thus, the Respondent's federal conspiracy conviction reduced the third degree felony, Section 893.13(1)(a)(2), Florida Statutes, to a first degree misdemeanor under Florida law. 4/ This analysis, however, assumes that Florida courts would equate a Florida and federal conspiracy conviction, an assumption which could be questioned. Although the court in Shields did not elaborate concerning what elements of federal conspiracy law were missing in Chapter 838 felonies, the Florida Supreme Court in Briklod v. State, 365 So.2d 1023, 1026 (Fla. 1978), noted one difficulty in uniformly applying conspiracy laws, observing that "... diverse courts have required different quantums of proof of the existence and membership of a conspiracy in order to obtain the admission of hearsay testimony."
Moral turpitude
Based on the above discussion, it is unnecessary to decide this issue. However, assuming that this issue were to be reached in this case, the statute in question, Section 626.611(7), Florida Statutes, is unclear concerning whether state or federal law, or both, control in order to determine whether a particular felony involves "moral turpitude."
Power to discipline must be clear
In the instant case, the applicable statutes, Sections 626.611(14) and 626.621(8), are susceptible to the construction urged by both parties to this proceeding. The language utilized in these statutes differs markedly from other professional regulatory statutes which consistently define the parameters of disciplinary power based on prior convictions with noteworthy precision. 5/ As discussed, supra, the legislative history of the statute, when considered in the context of constitutional changes and existing case law, does not offer appreciable assistance in attempting to resolve the issue of construction of these statutes. Had the Legislature included either the word "committed" or "court" when it amended the statutes in 1971, the intent of the amendment would have been clear.
The most persuasive argument in favor of interpreting the statutes geographically as urged by the Department is that such a construction is the most logical of the two alternatives, The Department's construction bars only federal felonies committed outside of any state, e.g., Washington, D.C., Puerto Rico, while the Respondent's interpretation bars all federal felonies regardless of where committed. 6/
It has been stated that when statutes provide grounds for revocation or suspension of a professional license such provisions must be strictly construed and followed. Bach v. Board of Dentistry, 378 So.2d 34, 36 (Fla. 1st DCA 1979), citing, State v. Pattishall, 99 Fla. 296, 126 So. 147, 148 (1930). When a statute authorizes revocation of a professional license for certain enumerated causes, such license cannot be revoked for any ground other than those specified. Bach, supra, Lester v. Department of Professional and Occupational Regulation, 348 So.2d 923, 925 (Fla. 1st DCA 1977).
Since the statutes in question do not unambiguously empower the Department to proceed to revoke or suspend the Respondent's license based on his federal conviction, the Department has not established a violation of either Section 626.611(14) or Section 626.621(8), Florida Statutes.
The Respondent's fitness to engage in the business of insurance
Regarding the Respondent Natelson's lack of fitness or trustworthiness to engage in the business of insurance, see Section 626.611(7), Florida Statutes, it is presumed that such lack of fitness or trustworthiness is based solely on the Respondent's flea in federal court to violating Sections 841(a)(1) and 846, Title 21, USC.
In this proceeding, the burden is on the Department to prove its allegations by clear and convincing evidence. Walker v. State, 322 So.2d 612 (Fla. 3d DCA 1975); Reid v. Florida Real Estate Commission, 188 So.2d 846 (Fla. 2d DCA 1966). When, such as here, it is alleged that a licensee breached a standard of conduct not explicitly fixed by statute or rule, "the critical
matters in issue must be shown by evidence which is indubitably as 'substantial' as the consequences." Bowling v. Department of Insurance, 394 So.2d 165, 172 (Fla. 1st DCA 1981).
Had the Respondent's federal conviction been linked in some manner with his business as an insurance agent, his fitness or trustworthiness would clearly be placed in issue. However, the only evidence in the record which links the Respondent's insurance business to the drug conspiracy was his partnership in Companion Health Services, Inc., a life and health insurance sales office, with Oscar Ansourian, a coconspirator in the federal crime. 7/ In contrast are the numerous letters of recommendation received from a wide variety of individuals in the insurance industry and the local community which
uniformly vouch for the Respondent's business practices, honesty and reputation.
The Respondent has been a licensed insurance agent approximately 10 years. No evidence was presented that during that period of time, the Respondent's insurance license has been the subject of any other disciplinary proceedings.
It has been stated that the purpose of an administrative disciplinary proceeding involving a licensed professional is not punitive, but is primarily an inquiry into the fitness of the licensee to practice his profession without constituting a threat to either the public or the profession. See, e.g., In re Kreamer, 535 P.2d 728, 14 Cal. 3rd 524 (1975); Matter of Preston, 616 P.2d 1 (Alas. 1980); Matter of Couser, 596 P.2d 26, (Ariz. 1979); Petition of Harrington, 367 A.2d 161 (Vt. 1976); Carter v. Folcarelli, 402 A.2d 1175 (R.I. 1979); Louisiana State Bar Association v. Quaid, 368 So.2d 1043 (La. 1979). Measured by these standards, the Respondent's federal conviction, when considered in conjunction with the unrebutted testimony and documentary evidence concerning the Respondent's personal and professional fitness, fails to demonstrate by clear and convincing evidence, his unfitness or untrustworthiness to engage in the business of insurance, and accordingly, revocation or suspension of his license, the only penalties provided by law, are not authorized.
E. Summary
The statutes in question, Sections 626.611(7) and 626.611(14),Florida Statutes, do not clearly and unambiguously empower the Department to discipline a licensee convicted of a federal felony. However, assuming arguendo, that the statute were construed as urged by the Petitioner, the Respondent's federal conspiracy conviction does not constitute a felony under Florida law as required by Article X, Section 10, Florida Constitution (1968).
Insufficient evidence was presented to establish by clear and convincing evidence that the Respondent is unfit or untrustworthy to engage in the business of insurance.
Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED:
That the Department of Insurance enter a Final Order dismissing its Administrative Complaint against the Respondent Gerald B. Natelson.
DONE and ORDERED this 20th day of May, 1983, in Tallahassee, Florida.
SHARYN L. SMITH
Filed with the Clerk of the Division of Administrative Hearings this 20th day of May, 1983.
1/ For example, as construed by the Department, federal convictions in Washington, D.C., Puerto Rico and the Virgin Islands would not be encompassed under either statute.
2/ Section 458.12(2), Florida Statutes, required: "... that the physician has been convicted in a court of competent jurisdiction of a felony. The conviction of a felony shall be the conviction of an offense which if committed within the State of Florida, would constitute a felony under the laws thereof."
3/ Section 893.03(1)(c)(3), Florida Statutes, lists cannabis as a Schedule I drug.
4/ The Petitioner's argument that the Respondent could have been charged with violating Section 893.135, Florida Statutes, is not supported by the record.
Even assuming that the state is authorized to inquire behind the face of the federal indictment, plea, and judgment, insufficient evidence was provided to demonstrate with any degree of reasonable certainty, the specific amount of marijuana involved in the conspiracy to which the Respondent pled nolo contendere.
5/ See, e.g., chiropractors, Section 460.413(1)(c), F.S., (convicted of a crime in any jurisdiction); podiatrists, Section 461.013(1)(c), F.S., (convicted of a crime in any jurisdiction); optometrists, Section 463.016(1)(d), F.S., (conviction of a crime in any jurisdiction); nurses, Section 464.018(1)(c), F.S., (convicted of a crime in any jurisdiction); pharmacists, Section 465.016(1)(f), F.S., (convicted in a court of this state or other jurisdiction); dentists, Section 466.028(1)(c), F.S., (convicted of a crime in any jurisdiction); radiologic technologists, Section 468.31(1)(b), F.S., (convicted in a court of competent jurisdiction either within or without this state); engineers, Section 471.033(1)(d), F.S., (convicted of a crime in any jurisdiction); accountants, Section 473.323(1)(d), F.S., (convicted of a crime in any jurisdiction); veterinarians, Section 474.214(1)(d), F.S., (convicted of a crime in any jurisdiction); real estate brokers, Section 475.25(1)(f), F.S., (found guilty of a crime against the laws of this state, or any other state or the United States); architects, Section 481.225(1)(d), F.S., (convicted of a crime in any jurisdiction); pest control, Section 482.161(4), F.S., (conviction in any court, in any state or in any federal court of a felony); opticians, Section 484.014(1)(r), F.S., (convicted in a court of this state or other
jurisdiction); mortgage brokers, Section 494.05(1)(d), F.S., (guilty of a crime against the laws of this state or any other state or of the United States); medical doctors, Section 495.015(1)(c), F.S., (convicted of a crime in any jurisdiction); and compare AGO -73-355, which construed Section 112.011(1)(b), F.S., as prohibiting licensing agencies from disqualifying convicted felons whose civil rights have been restored from practicing a trade or profession unless the conviction directly relates to the license held.
6/ Compare, Deep South Plantation Foods, Inc. v. Wynne, 317 So.2d 131 (Fla. 2d DCA 1975), which authorized the revocation of a beverage license on a federal felony conviction based on Section 561.29(1)(b), Florida Statutes, which prohibited a violation of "... any laws of this state, or any other state or territory of the United States." The court construed the underscored language to encompass a federal felony committed in Florida.
7/ It should be noted that this information is contained in Respondent's Exhibit 12, a newspaper clipping from the Sun Tattler, dated August 9, 1980.
Curtis A. Billingsley, Esquire Department of Insurance
Richard A. Barnett, Esquire 602 Center Court Building 2450 Hollywood Boulevard
