STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PAMELA W. WILLIAMS, d/b/a )

SECURE HOME MANAGEMENT, )

)

Petitioner, )

)

vs. ) CASE NO. 83-1772

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, this cause came on for administrative hearing before P. Michael Ruff, duly designated Hearing Officer of the Division of Administrative Hearings, on November 2, 1983, in Palatka, Florida. The appearances were as follows:

APPEARANCES

For Petitioner: Albert W. Whitaker, Esquire

Post Office Drawer D Palatka, Florida 32078-0019

For Respondent: James A. Sawyer, Jr., Esquire

District III Legal Counsel

1000 Northeast 16th Avenue, Building H Gainesville, Florida 32601

This cause arose upon an application for licensure of an adult congregate living facility, filed by Pamela W. Williams, d/b/a Secure Home Management, on January 31, 1983. After some correspondence and negotiation between the parties, the Department determined that financial criteria for licensure of an adult congregate living facility had not been met by the Petitioner and on May 4, 1983, notified the Petitioner of the Department's denial of the application for licensure. The Petitioner timely requested a Section 120.57(1) proceeding on the issue of its entitlement to an ACLF license. By prehearing stipulation and "motion for modification of issues," the parties have agreed to proceed to hearing and waive all notice requirements regarding the attempted imposition of an administrative fine on the Petitioner by the Respondent for allegedly operating the subject facility without a license from the period August 22, 1983, until October 14, 1983. By virtue of that prehearing stipulation, the parties have resolved the dispute regarding the entitlement of the Petitioner to an ACLF license, and the Petitioner was issued the license applied for on October 14, 1983. Thus, by agreement of the parties and pursuant to their waiver of notice on the issue of imposition of a fine on the Petitioner, the cause proceeded to hearing on that issue only. The issue which was heard thus involves solely the question of whether an administrative fine, pursuant to

Section 400.414(1)(b) and Section 400.419(1), (2) and (3), Florida Statutes, should be imposed.

The Department thus seeks to impose an administrative fine in the amount of

$440 for the period of time the facility allegedly operated without a license, that is, August 22, 1983, through the end of October 13, 1983. At the hearing, the Petitioner presented the testimony of Pamela Williams, the Petitioner, as well as Exhibits 1 and 2, consisting of a lease contract and a pledge of financial support by one Jack Allen, a financial backer of the ACLF involved.

Both exhibits were admitted into evidence. Additionally, the Petitioner called Lee Darden, the Supervisor of Aging and Adult Services for the Department of Health and Rehabilitative Services. The Respondent presented no testimony or evidence, relying instead on the matters contained in the stipulation to which the parties agreed, as well as legal argument concerning the Department's authority to impose the disputed administrative fine.

All proposed findings of fact, conclusions of law, and supporting arguments have been considered. To the extent that proposed findings and conclusions submitted are in accordance with the Findings, Conclusions and views stated herein, they have been accepted. To the extent that such proposed findings and conclusions and such arguments made are inconsistent herewith, 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. To the extent that the testimony of various witnesses is not in accord with the Findings herein, it is not credited.

FINDINGS OF FACT

1. The Petitioner, Pamela Williams, doing business as Secure Home Management, seeks a license to operate an adult congregate living facility (ACLF) in Palatka, Florida. The Respondent is an agency of the State of Florida charged with regulating the operation and practices of adult congregate living facilities and licensure thereof, together with enforcement of licensure standards contained in Chapter 400, Part II, Florida Statutes (1981).

   
   

2. Preliminary discussions and informal meetings between representatives of the Department and the Petitioner, Pamela Williams, occurred at various times in January 1983, during which discussions the Petitioner was advised by the Department that she was required to apply for an ACLF license in order to legally operate her business. The Petitioner took the position that the facility she operates was a transient rental facility and thus exempt from the ACLF licensing provisions contained in Chapter 400, Part II, Florida Statutes, which exemption is provided for at Section 400.404(d) of that chapter. However, as a result of these informal discussions between the parties, the Petitioner ultimately elected to apply for licensure as an ACLF and did so on January 31, 1983. After further deliberations by the Department, requests for additional information and further informal negotiations and conferences, the Respondent Department ultimately elected to deny the application for licensure and so informed the Petitioner on May 4, 1983. In essence, the reasons for the Respondent's denial of the application for licensure was the belief by the agency and its representatives that the applicant Petitioner lacked the financial ability to provide continuing adequate care to residents under authority of Section 400.414(1)(b), Florida Statutes (1981).

   
   

3. Subsequent to the denial of licensure, the Petitioner made a number of good-faith efforts to attempt to meet the Respondent's criteria for licensing in the area of furnishing proof of financial responsibility. For instance, on

   April 15, 1983, just before denial of licensure, a letter from Jack Allen, a financial backer of the Petitioner, was provided to the Department promising adequate financial support. That letter was admitted as Petitioner's Exhibit 1. However, the Department nonetheless elected to deny licensure, being unsatisfied that that constituted adequate establishment of financial security for the proposed licensed institution. Following the denial of the license, the Petitioner and the Respondent continued to attempt to resolve the problem regarding establishment of financial support for the institution. The Petitioner in that regard furnished the Respondent with additional documentary evidence from Jack Allen, dated May 12, 1983, and admitted as Petitioner's Exhibit 2, in which unlimited resources were promised in order to assure that the ACLF would embark on its operations on a secure financial footing.

   
   

4. Sometime in August 1983, in part at the behest of the Respondent, the Petitioner retained an attorney, with the result that a document establishing financial worth and responsibility for operating the facility with adequate provision for care for its residents from a financial standpoint was provided the Department, with the result that after certain other informal negotiations the license was ultimately issued on October 14, 1983, authorizing Pamela W. Williams, d/b/a Secure Home Management, to operate the subject ACLF. Prior to this licensure, the Petitioner continued to operate the facility while making good-faith attempts to meet the requirements of the Department and during which time the dispute concerning whether she needed licensure or conversely whether she came under the above-described exemption was unresolved in part between the parties. It was established through Petitioner's testimony, as well as that of Lee Darden, a representative of the Division of Aging and Adult Services of HRS, that at all times pertinent hereto, before and after licensure, the residents of the Petitioner's facility received at least adequate care and that the failure of the Petitioner to be licensed did not in any way jeopardize the health, safety or well-being of any of the Petitioner's residents.

   
   

   CONCLUSIONS OF LAW

   
   

5. The Division of Administrative Hearings has jurisdiction of the subject matter of and the parties to these proceedings. Section 120.57(1), Florida Statutes (1981).

   
   

6. Section 400.414, Florida Statutes (1981), deals with the grounds for suspension, revocation, or denial of licensure, and provides pertinently as follows:

   
   

   1. The department may deny, revoke, or suspend a license or impose an administrative fine in the manner provided in chapter 120.

   2. Any of the following actions by a facility or its employee shall be grounds for action by the department against a facility:

      (b) The determination by the department that the facility owner or operator is

      of questionable moral character or lacks the financial ability to provide continuing adequate care to residents

7. Section 400.419 concerns the specific penalty provisions, classifying penalties and the grounds for which they can be assessed by the Department. It provides:

   
   

   (1)(a) If the department determines that a facility is not in compliance with standards promulgated pursuant to the provisions of this part, including the operation of a facility without a license, the department, as an alternative to or in conjunction with an administrative action against a facility, shall make a reasonable attempt to discuss each violation and recommended corrective action with

   the owner or operator of the facility, prior to written notification thereof. The department, instead of fixing a period within which the facility

   shall enter into compliance with standards, may request a plan of corrective action from the facility which demonstrates a good faith effort to remedy each violation by a specific date, subject to the approval of the department.

   (b) Any facility owner or operator found to be in violation of this part shall be liable to a fine, set and levied by the department.

   
   

   1. In determining if a penalty is to be imposed and in fixing the amount of the penalty to be imposed, if any, for a violation, the department shall consider the following factors:

      1. The gravity of the violation, including the probability that death or serious physical or emotional harm to a resident will result or has resulted, the severity of the actual or potential harm, and the extent to which the provisions of the applicable statutes or rules were violated.

      2. Actions taken by the owner or operator to correct violations.

      3. Any previous violations.

      4. The financial benefit to the facility of committing or continuing the violation.

         
         

   2. Each violation shall be classified according to the nature of the violation and the gravity of its probable effect on facility residents. The department shall indicate the classification of each violation on the face of the notice of the violation as follows:

      1. Class "I" violations include overt resident abuse and negligence related to the operation and maintenance of a facility which the department determines present an imminent

         danger to the residents or guests of the facility or a substantial probability that death or serious physical or emotional harm would result therefrom. . .

      2. Class "II" violations are those conditions or occurrences

         related to the operation and maintenance of a facility which the department determines directly threaten the physical or emotional health, safety, or security of the facility residents.

      3. Class "III violations are those conditions or occurrences

         related to the operation and maintenance of a facility which the department determines indirectly or potentially threaten the physical or emotional health, safety, or security of facility residents, other than class I or II violations. A class III violation shall be subject to a civil penalty of not less than $100 and not exceeding

         $500 for each violation. A citation for a class III violation shall specify the time within which the violation is required to be corrected. If a class III violation is corrected within the time specified, no civil penalty shall

         be imposed, unless it is a repeated offense.

         
         

   3. The department may set and levy a fine not to exceed $500 for each violation which cannot be classified according to subsection (3). In no

   event shall such a fine in the aggregate exceed $5,000.

   
   

8. The above Findings of Fact reveal that in the period of time from August 22, 1983, until October 14, 1983, the time during which the Respondent seeks to apply its fining provisions, the Petitioner was indeed technically operating an ACLF facility without a license. In that event, depending on the circumstances in which it was so operated, a fine in varying amounts could be assessed by the Department. The October 17, 1983, letter from Respondent to Petitioner regarding the assessment of the fine speaks in general terms of the fines being assessed pursuant to Chapter 400, Part II, Florida Statutes, but not specifically as to which section of Section 400.419, the above penalty provision, it was employing in its attempt to assess the fine. Section 400.419 (3), Florida Statutes, quoted above, requires that violations shall be classified according to their nature and gravity of effect on facility residents and the classification of each violation shall be indicated on the Notice of Violation. The Notice of Violation here was merely a letter which did not attempt to classify the violations for which the Respondent seeks to impose a fine. Section 400419(3)(c), cited above, provides that a Class III violation, which this lack of licensure could arguably be (in that it could indirectly or potentially threaten physical or emotional health, safety or security of residents), must specify the time within which the violation is required to be corrected and that the Class III violation shall be the subject of a civil penalty of not less than $100 and not exceeding $500 per violation. Such a

   specification regarding a "correction time," as well as a classification for purposes of the above statute of the violation for which the Department was seeking to impose the fine, was not provided the Petitioner in this instance. Thus the Department may only fine under Subsection (4) above, which is a general fining provision allowing the Department to set and levy a fine not to exceed

   $500 per violation or $5,000 in the aggregate of violations, but with no minimum amount. Thus, the $500 maximum and $100 minimum fines provided for in the classified violation provisions cited above do not apply herein.

   
   

9. In determining the amount of a penalty to be assessed, the Department must consider the various factors enumerated in Section 400.419(2) involving considerations of the gravity of the violations, the likelihood or probability of its resulting in death or serious physical or emotional harm to residents, the severity of the actual potential harm and the extent to which provisions of applicable statutes or rules have been violated, with concomitant consideration for any corrective action taken by the owner or operator, any previous violations by the owner or operator, and the financial benefit to the facility by the commission of the violation.

   
   

10. The above Findings of Fact establish that this is not a factual situation in which a fine is warranted. The gravity of the violation is certainly not severe, given the circumstances surrounding this case. The only violation is operating without a license during a two-to-three month period of time, during which the need for licensure was the subject of a good-faith dispute between the parties. There was absolutely no likelihood during the nonlicensed period of time in question during which the Petitioner operated that any death or serious physical or emotional harm would, or did, result to the residents. In fact, the testimony presented by a representative of the Department, who inspected the facility, established that at all times the residents received due and adequate care and were not endangered in any way. Further, the Petitioner continually sought to take corrective action regarding the violation by filing an application for licensure and seeking to establish entitlement to licensure and comport with licensure requirements of the Department, most pertinently with regard to establishing financial responsibility. Although the Petitioner at least initially disputed Respondent's assertion of the need for licensure vis-a-vis the Petitioner's Position that the facility should be exempt for the reason delineated above, the Petitioner voluntarily agreed to submit to the licensure requirements during the course of the "free-form" stage of its contact with the Respondent and made continuing good-faith efforts to satisfy the Respondent's criteria concerning the one area (financing) in which the Respondent disputed Petitioner's entitlement to licensure. The Petitioner continually took action, up until the time licensure was finally agreed to by the Department, to establish its financial reliability for purposes of operating an ACLF and therefore is concluded to have taken good-faith efforts to correct the subject violation regarding operating an ACLF without a license. There is no record of any previous violations of Chapter 400, Part II, by the Petitioner, and Petitioner received no financial benefit by committing the violation per se, other than any financial benefit she may have obtained through revenues associated with continuing her ACLF operation during the pendency of her licensing dispute. The violation is, in reality, merely a technical one, and, since Subsection (4) cited above, does not contain any requirement for a minimum fine once a violation is determined to have occurred, it is concluded that the facts do not justify the imposition of a fine against the Petitioner in this matter.

RECOMMENDATION

Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence in the record, and the pleadings and arguments of the parties, it is, therefore,

RECOMMENDED:

That a final order be entered by the Department of Health and Rehabilitative Services finding that no fine be assessed and levied upon Pamela

W. Williams, d/b/a Secure Home Management.

DONE and ENTERED this 10th day of February, 1984, in Tallahassee, Leon County, 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 10th day of February, 1984.

COPIES FURNISHED:

Albert W. Whitaker, Esquire Post Office Drawer D Palatka, Florida 32078-0019

James A. Sawyer, Jr., Esquire District III Legal Counsel Department of Health and

Rehabilitative Services 1000 NE 16th Avenue,

Building H

Gainesville, Florida 32601

David H. Pingree, Secretary Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32301

Docket for Case No: 83-001772

Orders for Case No: 83-001772