vs. ) CASE NO. 83-3266
) JAY R. TOLL and THE HOME AGENCY ) REAL ESTATE CORPORATION, )
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 January 12, 1984, in Fort Lauderdale, Florida. The following appearances were entered:
For Respondent: Jay R. Toll, pro se
The issue for determination at the final hearing was whether Petitioner should suspend, revoke or take other disciplinary action against Respondents for allegedly violating Sections 475.25(1)(b) and (d) and 475.25(1)(e) and (k), Florida Statutes and Rule 21V-14.13, Florida Administrative Code.
At the final hearing, W. J. McNaughton, Ralph W. Oxford, Harvey Harris and Frank King, testified for the Petitioner. Jay R. Toll and Harvey Harris testified for the Respondents. Petitioner's Exhibits 1-15 were offered and admitted into evidence.
A Proposed Recommended Order has been filed by Petitioner containing findings of fact which have been considered by the undersigned in the preparation of this Recommended Order. When the Petitioner's findings were consistent with the weight of the credible evidence introduced at final hearing, they were adopted and are reflected in this Recommended Order. To the extent that the findings were not consistent with the weight of the credible evidence, they have been either rejected, or when possible, modified to conform to the
evidence. Additionally, proposed findings which were subordinate, cumulative, immaterial or unnecessary have not been adopted.
At all material times, the Respondent Jay R. Toll ("Toll") was a licensed real estate broker, acting as the sole qualifying broker and officer of the Respondent The Home Agency Real Estate Corporation ("Home Agency").
At the time of the hearing, the licenses of the Respondent Toll and the Respondent Home Agency had expired, and were thus in inactive status.
From October of 1980 to April 8, 1981, Laura Oxford was employed as a salesman for Home Agency. On April 8, 1981, Laura Oxford expired.
By letter dated June 10, 1981, Attorney W. J. McNaughton, representing the estate of Laura Oxford, notified the Respondent Toll that he was to retain all commissions, together with a full accounting thereof, in Toll's escrow account until McNaughton advised Toll as to the time when the money should be delivered to the estate.
By letter dated June 19, 1981, Toll responded that he owed Laura Oxford
$883.73 for the Hawkins to Macaluso sales transaction, and that he would keep that sum in escrow.
By letter of October 22, 1982, McNaughton informed Toll to forward the check for all commissions due to Laura Oxford to the estate of Laura Oxford.
Hearing no response from Toll, McNaughton again wrote to both Respondent Toll and Respondent Home Agency and requested them to forward the commissions due Laura Oxford. McNaughton also stated that if he had not heard from Toll within seven days of Toll's receipt of the letter, he would report Toll to the Florida Real Estate Commission.
Again hearing no response, McNaughton wrote to Toll on January 5, 1983 requesting the $883.73, and also indicated to Toll that McNaughton was aware of four real estate deals at the time of Oxford's death, for which she may have been owed commissions. This letter was sent to Toll at his home address, and to Home Agency at its business address, certified mail, but both were returned unclaimed.
When this last attempt at communication with the Respondents' failed, McNaughton advised Ralph Oxford, personal representative of the estate of Laura Oxford, to file a complaint with the Florida Real Estate Commission.
On February 26, 1982, Toll's escrow account in which the $883.73 in commission due Laura Oxford had been maintained was closed, and the funds were thereafter not maintained in escrow.
The complaint Ralph Oxford filed against the Respondents was investigated from April 20, 1983 to May 27, 1983, by Department Investigator Frank King.
On May 20, 1983, Frank King interviewed Toll with regard to Mr. Oxford's complaint. During that interview, Toll admitted that he owed the estate of Laura Oxford $927.50 for the Miller to Rivera sales transaction and
$75 for the Price to Rosario sales transaction.
Ralph Oxford first became aware that there were commission monies due Laura Oxford in excess of $883.73 when investigator Frank King so notified him during the course of investigation of Toll. At no time prior to May, 1983 did Toll report to McNaughton or Ralph Oxford that additional monies were due Laura Oxford.
Toll utilized the commissions due the estate of Laura Oxford for his own use and benefit without the prior knowledge and consent of Laura Oxford or her estate.
On July 25, 1980, Toll submitted an application for licensure of The Home Agency Real Estate Corporation, listing Jill Harris, wife of Harvey Harris, as vice president and registered agent of the corporation, and listing Harvey Harris as a 50 percent owner in the corporation.
On July 29, 1980, Harvey Harris gave Toll a check in the amount of
$2,550 as partial payment for ownership of 50 percent of Home Agency. The total purchase price for 50 percent of the stock of Home Agency was $3,500.00. The original agreement between Harvey Harris and Toll was that Harris was to own 50 percent of the profits of the corporation. The stock was never issued.
On August 19, 1980, Harvey Harris became employed by Home Agency as a real estate salesman and remained so employed until approximately April 22, 1981.
Early in Harris' employment, Toll told Harvey Harris that he did not want partners in the corporation, and offered instead to make Harvey Harris sales manager with Harvey Harris receiving 60 percent of listings and sales and Home Agency receiving 40 percent. Harvey Harris was also to get $100 for each deal that came in the office and $50 a week toward car allowance. Toll's agreement with Harvey Harris included the provision that Toll be placed on all of Harvey Harris' listings so that if Harris was out of the office canvassing or training salespeople and customers called to inquire about a listing, Toll would be able to take the calls. Further, if Harris took a listing and was also selling salesman for the listing, he would retain 70 percent of the money with
30 percent going to Home Agency. Through several payments, Toll paid back the
$3,500 originally paid to him by Harvey Harris for the stock.
Harris was the listing salesman in the Brown to Herrara transaction. Toll took no part in the listing which was sold by another real estate office. Under the terms of the agreement between Toll and Harris, Harris should have received 60 percent of Home Agency's share of the commission. Home Agency received $2,349 as commission, and Harris was to receive $1,404.00. Instead, Harvey Harris received nothing. When Harris demanded his commission, Toll told him that he needed the money to keep Home Agency open and stated that he would pay Harris back.
Harvey Harris was the listing salesman in the Lassiter to O'Bier transaction. Toll procured the purchasers, the O'Biers. In that transaction Home Agency received $3,750.00. Toll should have received 60 percent of that amount, but instead received nothing. Harris discussed the commission with Toll and was again told by Toll that he needed the money to keep the office open.
Harvey Harris was both the listing and rental salesman in the Temple Israel to Mishel rental transaction. As such, he was entitled to 70 percent of the $700 commission. Instead Harvey Harris received $175.00. When he
confronted Toll about the additional monies due him, Toll told him that that was all he would receive.
Harris was the selling salesman in the Carsaglia to Caveras transaction. The listing was held by 4 percent Realty. Toll had no involvement in the transaction, other than rewording the contract.
Harris was due 60 percent of the commission in the Carsaglia to Caveras transaction. Home Agency received approximately $2,200.00. Harris received $570.19, significantly less than the approximately $1,320 that he was entitled to receive.
Harris was the listing salesman and selling salesman in the Force to Albertoria transaction. Home Agency received $3,720 in commissions from that transaction. Under the terms of his agreement with Toll, Harris was to receive
70 percent of that commission. Instead, Toll paid Harris $116 initially, with twelve payments of $88.85 due monthly. Toll did not pay the last two payments in the amount of $88.85 to Harris.
Harris received no other monies from Toll on the commissions previously discussed, and when he requested the commissions and pursued the point he was fired. After leaving Toll's employment, Harris repeatedly requested the commissions and Toll failed to deliver them.
The Respondent Toll presented no defense to the allegations involving Laura Oxford, but did defend the statements of Harris by presenting testimony that Harris in fact was indebted to Home Agency.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding. Section 120.57(1), Florida Statutes.
By seven count Administrative Complaint, the Respondents are charged with violating Sections 475.25(1)(b), 475.25 (1)(d) and Rule 21V-14.13, Florida Administrative Code, by operation of Section 475.25(1)(e) and (k), 1/ Florida Statutes, in their dealings with Oxford and Harris. These statutory provisions provide as follows:
The commission may deny an application for licensure, registration, or permit, or renewal thereof; may suspend a license or permit for a period not exceeding 10 years; may revoke a license or permit; may impose an administrative fine not to exceed $1,000 for each count or separate offence; and may issue a reprimand, or any or all of the foregoing, if it finds that the licensee, permitee, or applicant:
* * *
(b) Has 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, nation, or territory;...
* * *
Has failed to account or deliver to any person, including a licensee under this chapter, at the time which has been agreed upon or is 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, fund, deposit, check, draft, abstract of title, mortgage, conveyance, lease, or other document or thing of value, including a share of real estate commission, or any secret or illegal profit,
or any divisible share or portion thereof, 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. However, if the licensee, in good faith, entertains doubt as to what person is entitled to the accounting and delivery
of the escrowed property, or if conflicting demands have been made upon him for the escrowed property, which property he still maintains in his escrow or trust account, the licensee shall promptly notify the commission of such doubts or conflicting demands and shall promptly:
Request that the commission issue an escrow disbursement order determining who is entitled to the escrowed property;
With the consent of all parties, submit the matter to arbitration; or
By interpleader or otherwise; seek adjudication of the matter by a court. If the licensee promptly employes one of the escape procedures contained herein, and if he abides by the order or judgment resulting therefrom, no administrative complaint
may be filed against the licensee for failure to account for, deliver, or maintain the escrowed property.
Has violated any of the provisions
of this chapter or any lawful order or rule made or issued under the provisions of this chapter or chapter 455.
The Respondents asserted at final hearing that monies due to Harris were withheld as a setoff against monies owed to them. No such assertion was made concerning Laura Oxford.
In Golub v. Department of Professional Regulation, Case No. 83-65, Florida Fifth District Court of Appeal, opinion filed February 23, 1984, the Court held that the Department's disciplinary power could not be invoked in a situation where a broker claimed a setoff of commissions due to a salesman. Moreover, it was noted, citing Fleischman v. Department of Professional Regulation, 441 So.2d 1121 (Fla. 3d DCA 1983), that the escape procedures in
Section 475.25(1)(d) relate only to "escrowed property" and not contested commission fees. Accordingly, no violation of Sections 475.25(1)(d) or (e), Florida Statutes, was demonstrated regarding the Respondents dealings with Harris and Oxford.
The Respondents are also charged with fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence and breach of trust in a business transaction in their dealings with Harris and Oxford.
The Petitioner has demonstrated by clear and convincing evidence that the Respondents' actions toward Oxford's attorney following her death were fraudulent, dishonest and culpably negligent. Although the Respondents' dealings with Harris were also improper, they did not rise to the level of willfulness or other intentional wrongdoing as required by Section 475.25(1)(b), Florida Statutes.
Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED:
That a Final Order be entered by the Florida Real Estate Commission finding the Respondents guilty of Count One of the Administrative Complaint and suspending the licenses of Jay R. Toll and The Home Agency Real Estate Corporation for a period of three (3) years.
DONE and ENTERED this 30th day of March, 1984, in Tallahassee, Florida.
SHARYN L. SMITH
Filed with the Clerk of the Division of Administrative Hearings this 30th day of March, 1984.
1/ The Petitioner conceded that since commissions due from a broker to a salesman are not required to be maintained in escrow, no violation of Section 475.25(1)(k), Florida Statutes, exists.
Jay R. Toll
Harold Huff, Executive Director Florida Real Estate Commission Post Office Box 1900
Frederick M. Roche, Secretary Department of Professional
