STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DAVID E. FUGATE, )

)

Petitioner, )

)

vs. ) CASE NO. 83-031

)

DEPARTMENT OF PROFESSIONAL ) REGULATION, FLORIDA REAL ESTATE ) COMMISSION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, this cause came on for administrative hearing before P. Michael Ruff, duly designated A. Hearing Officer of the Division of Administrative Hearings, on July 14, 1983, in Englewood, Florida.

APPEARANCES

For Petitioner: David Fugate, pro se

1028 South East 18th Place Cape Coral, Florida 33904

For Respondent: Lawrence Gendzier, Esquire

Department of Legal Affairs

Office of Attorney General, The Capitol Tallahassee, Florida 32301

ISSUE

This cause arose upon a denial of an application for licensure by the Florida Real Estate Commission. Denial was based upon the applicant's answer to question six of the licensing application regarding his prior criminal record under authority of Section 475.17(1), as well as 475.25(1)(b), Florida Statutes (1979). Specifically, the Florida Real Estate Commission notified the Petitioner that the denial of the application was based upon the following:

1963 conviction of armed robbery

1965 conviction of false police report 1967 conviction of worthless check

1968 and 1971 convictions for public intoxication 1971 conviction for assault and battery

1976 and 1980 convictions for public intoxication 1982 indecent exposure charge

The Petitioner requested a formal hearing to be permitted the opportunity to present testimony and evidence in support of his petition for application for licensure, and the cause ultimately came on for hearing on the above date after completion of discovery. At the hearing, the Petitioner presented the testimony

of two witnesses, including himself, as well as the testimony of a witness from out of state who was unable to attend, whose testimony was admitted in the form of an affidavit stipulated into evidence by the parties. The Respondent presented one witness. The Petitioner presented six exhibits, all of which were admitted into evidence. The Respondent presented four exhibits which were admitted into evidence.

At the conclusion of the hearing, the parties requested the benefit of a transcript and the right to file proposed findings of fact and conclusions of law. Proposed findings of fact and conclusions of law were timely filed by the Respondent.

All proposed findings of fact and supporting arguments of the parties have been considered. To the extent that the proposed findings and conclusions submitted by the parties, and the arguments made by them, are in accordance with the findings, conclusions and views stated herein, they have been accepted, and to the extent that such proposed findings and conclusions of the parties, and such arguments made by the parties are inconsistent therewith, they have been rejected. Certain proposed findings and conclusions have been omitted as not relevant or as not necessary to a proper determination of the material issues presented.

FINDINGS OF FACT

1. The Petitioner is a native of Ohio, having lived in that state until coming to the Ft. Myers area to live and enter business in 1980. Some twenty- one years ago, when he resided in Ohio at the age of thirteen years, he was charged with armed robbery, according to his arrest record in evidence. On that occasion, he was placed in the custody of the Ohio Youth Commission and placed in an industrial school for boys. Again, on September 9, 1965, he was arrested for making a false police report and was returned to the custody of the Ohio Youth Commission as a juvenile offender once again. While originally in the industrial school for boys in Ohio pursuant to the first arrest, he was not permitted to attend high school classes because of a severe vision problem (nearly legally blind) and the school had no facilities for education of those with his visual handicap. He was tutored instead by a priest, apparently at the school. Prior to that, he had been formally educated up to and including approximately three months of high school. In Ohio, at that time, these acts were considered to be "juvenile acts of delinquency" and not classed as criminal convictions.

   
   

2. Between May 24, 1968, and June 24, 1980, the Petitioner had seven arrests for public intoxication. Those arrests culminated in the payment of $25 fines, and in one instance, a $40 fine with no court appearance. In effect, the bond was estreated. On July 20, 1971, he was arrested for assault and battery and paid a $100 fine, again with no court appearance. All of these arrests, with the exception of the original armed robbery juvenile delinquency instance, were misdemeanors. All occurred in Dayton, Ohio.

   
   

3. On November 23, 1982, by Order of the Montgomery County, Ohio, Court of Common Pleas, Juvenile Division - the records of David Fugate were expunged. According to that Order, the court found that rehabilitation of the applicant, David Fugate, had been attained to a satisfactory degree and, accordingly, ordered that all records pertaining to David Fugate be sealed; that the proceedings in the case be deemed to have never occurred and that all index references to said applicant be deleted. This Order is somewhat ambiguous in that it mentions "case" in the singular, but then mentions all records

   pertaining to David Fugate and all "index references" referring to the applicant being deleted from his record and, further, that all copies of fingerprints or pictures taken of the applicant "in this cases" should be destroyed. It is not clear whether an expungement of all record of offenses committed in Ohio through 1980 was ordered, or merely of those matters involving the juvenile division of the court; that is, the three offenses occurring in 1963, 1965 and 1967. In any event, the Court's expungement of the applicant's "record in this court" is found to mean all three juvenile court offenses, especially in view of the applicant's and his corroborating witness' testimony. Further, with regard to the issue raised by the public intoxication charges (to the extent they may not have been expunged by the Order represented by Respondent's Exhibit 1), the Petitioner acknowledges that he had a drinking problem, related to marital difficulties, during his ten years of marriage. All those cases were misdemeanors and generally the subject of fines, not involving court appearances. Petitioner has since overcome his drinking problem, as evidenced in his unrefuted testimony, and that of witness Lawrence who has worked with him for approximately ten years and knows his personal habits quite well. It was thus established that the Petitioner has never had a problem with alcohol which interfered with his business and his relationship with the public and, indeed, his employer, witness Lawrence, was never aware that he had a drinking problem at all.

   
   

4. Mr. Lawrence has employed the Petitioner over a period of approximately ten years in a finance company, loan and collection business. The Petitioner often was required to handle and transport large sums of money and never committed any dishonest act or irregularity concerning his handling of his employer's money. He has loaned several thousand dollars to the Petitioner and has been timely paid when any amounts came due and would not hesitate to enter into business dealings with the Petitioner in the future.

   
   

5. Donald Jansen, a former professor in the areas of communication and criminal justice at Ohio State University, has known the Petitioner for approximately eighteen years. He first became acquainted with the Petitioner when the Petitioner was made a ward of the State of Ohio and placed in the Ohio Youth Commission Boys' Industrial School, where Mr. Jansen was employed at the time. One of his duties was to orient and counsel boys with regard to life at the school. He felt that David, the Petitioner, had a potential that most of the boys under his care did not have and he has maintained regular contact with him ever since. Petitioner worked with him as a volunteer in Dayton, 0hio, in the area of community contact work with youth in a salaried position and exhibited great concern for others, and in assisting young men who were in trouble, to better their lives. Mr. Jansen has observed Petitioner over the years and has observed the change in his attitude toward himself and others. He is more reliable than most people Mr. Jansen has dealt with and they have had financial dealings together in which the Petitioner has been honest and ethical in every way. He has never betrayed a trust and Mr. Jansen has placed thousands of dollars in the Petitioner's care in these financial dealings without regret. In the near future, he plans to engage in business with the Petitioner with proceeds of a large wheat farm which he plans to liquidate in the State of Nebraska. The Petitioner's conduct and attitude over the years shows that the Petitioner is determined to overcome his visual handicap and become a productive member of society, rather than seek public assistance and that he has genuinely rehabilitated himself in the long years since his more serious juvenile offenses. In that connection, this witness corroborated the testimony of the Petitioner in establishing that, indeed, the expungement order went to all three juvenile offenses, and, in the words of the court in that order, "the proceedings in such case be deemed never to have occurred."

6. It is noted that the Petitioner, himself, established that his problem with alcohol was related to his domestic difficulties over a period of years and that with the resolution of those difficulties (his divorce) he has concomitantly overcome his alcohol problem. It has been clearly established that any problem with alcohol in the past has not interfered with his business and financial dealings. Indeed, his reputation for responsible conduct of his business affairs since arriving in Florida is demonstrated by the fact that he has recently been approved for a real estate mortgage loan in the amount of fifty-five thousand ($55,000) dollars together with an unsecured signature loan in excess of one thousand ($1,000) dollars. The Petitioner has achieved some financial success by his work in real estate investments, owning several parcels of real estate himself and serving as President of Florida Credit and Investment Corporation.

   
   

7. The Petitioner's arrest in March, 1982, on a charge of indecent exposure, as freely admitted by the Petitioner, involved urination in a public place. The charge was nol prossed and the court informed the Petitioner that that event rendered the matter to be "as if it never occurred." Because of this belief, the Petitioner failed to list it on his application in answer to question number six. The Petitioner listed all other past charges or arrests, some of which were more serious, and failed to list the March, 1982, charge because he did not feel it relevant since the court informed him that he could conduct himself as if had not occurred. There was no showing of any facts surrounding that arrest which would demonstrate that the Petitioner is clothed with a character which might pose a danger to the interests of the public and investors if his registration and licensing were granted.

   
   

8. In short, it has been established that the Petitioner has clearly attained rehabilitation from his earlier, aberrant behavior and that a sufficient lapse of time and subsequent good conduct reveals that the Petitioner's character is now such that he can be safely trusted with the affairs and finances of funds of members of the public who entrust their real estate and financial affairs to him in the capacity of a licensed realtor.

   
   

9. The Petitioner has taken and passed the required real estate educational course and passed the test administered at the end of that course as a prerequisite to being admitted to the Florida real estate examination.

   
   

   CONCLUSIONS OF LAW

   
   

10. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this proceeding. Section 120.57(1), Florida Statutes (1981).

    
    

11. Subsection 475.17(1), Florida Statutes (1981), provides that an applicant for licensure must be eighteen years of age, a bona fide Florida resident, have a good reputation for fair dealing, and shall be honest, trustworthy, and of good character, and that subsection further provides:

    
    

    If the applicant has been guilty of conduct or practices in this State or elsewhere which would have been grounds for revoking or suspending his license under this Chapter had the applicant then been registered, the

    applicant shall be deemed not to be qualified, unless, because of lapse of time and

    subsequent good conduct and reputation, or other reason deemed sufficient, it shall appear to the Board that the interests of the public and investors will not likely be endangered by the granting of registration.

    
    

    Subsection 475.25(1)(b), Florida Statutes, provides in pertinent part that an application may be denied if the applicant has been:

    
    

    Guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealings by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction, in this state or any other state, nation, or territory. . .

    
    

    The Respondent maintains that the Petitioner's arrests from May, 1968, through March, 1982, establish a course of conduct showing the Petitioner not to be competent to handle the funds of others. Section 475.25(1)(b), however, refers to being found guilty for 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 Florida or other territories or states. The arrests beginning in May, 1968, were all for public intoxication, one assault and battery, and one indecent exposure (urination outdoors in a public place). Those arrests (and convictions from May, 1968, up to June, 1980) did not involve situations of fraud, misrepresentation, dishonest dealings, etc., in any business transaction and are totally unrelated to questions involving the Petitioner's honesty and character and reputation for fair and honest dealing, and involve no misrepresentation or false promises.

    They merely show that on those occasions, he may have been publicly intoxicated. With regard to the March, 1982, arrest for indecent exposure, that involved no conviction whatever, since the charges were "nol prossed." Further, that situation involved no guilt of fraud, misrepresentation, concealment, false promises, dishonest dealings, etc., for purposes of the subsection quoted last above.

    
    

12. Further, with regard to the arrests in 1963, 1965, and 1967, involving armed robbery, false police report, and a worthless ten ($10) dollar check, the Hearing officer concludes that the greater weight of the evidence consisting of the judge's order of Expungement referred to in the Findings of Fact above, as well as the Petitioner's testimony and the testimony of Donald Jansen, reveals that, indeed, in Ohio, those three juvenile matters were acts of delinquency which involved one all-encompassing record "case number" of which the court expunged. The court in that expungement proceeding found that rehabilitation of the applicant had been attained to a satisfactory degree, that all records pertaining to the matters before the Juvenile Division of the Montgomery County Court of Common Pleas (which the undersigned concludes means all three of those early offenses) should be sealed and the proceedings deemed never to have occurred, with all index references to David Fugate to be deleted. Thus, it is concluded that the applicant herein would have been on sound legal ground by denying that those arrests and convictions had ever occurred for purposes of Ohio and Florida law regarding expungement of prior criminal records. See, Section 943.058, Florida Statutes (1980). Nevertheless, in an abundance of candor, the Petitioner disclosed those arrests and convictions under the juvenile court system of Ohio in his application involved herein. The Hearing Officer concludes that even had the records of those convictions not been properly expunged and rendered "never to have occurred," that the last such

    offense occurred in 1967 and that the testimony of the Respondent, the testimony of Donald Jansen, and Gene Lawrence clearly and conclusively established that the Petitioner has become rehabilitated with regard to his moral character such that his character is now clothed with dominant traits of honesty and a willingness to honestly achieve what he is able to in support of himself in his chosen field of business endeavor by his own exertions, rather than any demonstration of a penchant for scheming against or defrauding others. This rehabilitated character has been demonstrated by long years of subsequent good conduct in his own financial and business dealings and even in his representation of the substantial and significant financial interests of others in business deals in which he has been entrusted with thousands of dollars of money belonging to others, with never an irregularity or failure to properly account for the same. This sixteen year period of good conduct and honesty in dealing with others and in representing others in financial matters has thus established a substantial reputation possessed by the Petitioner in his community for honest and fair dealing with respect to the rights of others.

    
    

13. The Hearing Officer is somewhat concerned over an apparent alcohol- related problem the Petitioner has had which may have indeed resulted in his fairly recent arrest in March, 1982; however, the evidence by the Petitioner and witness Lawrence is unrefuted and establishes that the Petitioner no longer has any alcohol-related personality problems and that even at those times contemporaneous to the arrests for public intoxication, the Petitioner never lost his job or allowed that supposed problem to interfere with his financial dealings involving obtaining and accounting for large sums of money accurately to his employer. In a recent case, illicit conduct perpetrated by a petitioner occurred five years prior to the application for licensure. Since that time, the petitioner had held a number of responsible positions engaged in a business involving handling other people's money on a day-to-day basis. The Hearing 0fficer (and the court) found that she had done so in a responsible, honest manner and uncontroverted testimony established she had a reputation for fair and honest dealings. The Fourth District Court of Appeal thus concluded in that case that the appellant had established a reputation for fair and honest dealing; that the interests of the public and investors would not likely be endangered by the granting of the application for registration and that five years since the appellant's charge of aiding and abetting the sale of unregistered securities, was a sufficient time for her to rehabilitate herself. It that case, as in the instant one, the Board tendered no evidence of the applicant's misconduct since the episodes mentioned as a basis for denying the application for licensure. All the evidence in that case pointed toward rehabilitation as it does in the instant case. See, Aquio v. Department of Professional Regulation, Board of Real Estate, 430 So.2d 598 (Fla. 4th DCA 1983). In the case at bar, the Respondent has submitted no evidence to show any misconduct by the Petitioner since those matters which involved dishonesty occurring sixteen to twenty-one years ago in Ohio, and thus has not refuted the Petitioner's showing of rehabilitation and reputation for honesty and fair dealing.

    
    

14. The arrests for public intoxication did not involve any conduct proscribed under Section 425.23(1)(b) as grounds for revoking or suspending a license. That being the case, no derivative failure to establish qualifications under Section 475.17(1) has been established with regard to those charges and further, it has been established that the Petitioner has overcome any drinking problem he may have had related to marital difficulties which have now been resolved. Thus, the Petitioner has demonstrated by a preponderance of the evidence that his licensure would not be in derogation of the interests of the

public and investors and that their interests would not be endangered by the granting of his registration.

RECOMMENDATION

Having considered the foregoing Findings of Fact and Conclusions of Law, the evidence in the record, the candor and demeanor of the witnesses, it is therefore

RECOMMENDED:

That the application of David Fugate for a real estate salesman's license be GRANTED.

D0NE and ENTERED this 26th day of 0ctober, 1983, in Tallahassee, Florida.

P. MICHAEL RUFF 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 26th day of October, 1983.

COPIES FURNISHED:

David E. Fugate

1028 South East 18th Place Cape Coral, Florida 33904

Lawrence Gendzier, Esquire Department of Legal Affairs Office of Attorney General The Capitol

Tallahassee, Florida 32301

Randy Schwartz, Esquire Assistant Attorney General Department of Legal Affairs Suite 212

400 West Robinson Street Orlando, Florida 32801

Fred M. Roche, Secretary Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32301

Docket for Case No: 83-000031

Orders for Case No: 83-000031