STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS REGULATION ) DIVISION OF FLORIDA LAND SALES ) AND CONDOMINIUMS, )

)

Petitioner, )

)

vs. ) CASE NO. 84-0834

) MURRAY FIELDS d/b/a/ PINECREST ) ESTATES )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice a formal evidentiary hearing was held in this case on August 23, 1984, in Miami, Florida, before Michael M. Parrish, a duly designated Hearing Officer of the Division of Administrative Hearings. The appearances at the hearing were as follows:

For Petitioner: Thomas L. Barnhart, Esquire

Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301

For Respondent: Mr. Murray Fields, pro se

Post Office Box 600474

North Miami Beach, Florida 33160 INTRODUCTION

The issue in this case is whether the Petitioner, Department of Business Regulation, Division of Florida Land Sales and Condominiums (hereinafter referred to as "the Division"), should issue a cease and desist order against the Respondent, Murray Fields, and/or impose civil penalties on the Respondent, Murray Fields, for allegedly offering or disposing of lots in Pinecrest Estates, a subdivision in St. Johns County, Florida, without a valid order of registration and without delivering to the purchaser a current offering statement in violation of Section 490.023, Florida Statutes.

At the hearing the Division presented the testimony of one witness, Shirley Arthur, and offered 23 exhibits, all of which were received in evidence. Mr.

Fields testified on his own behalf, but did not call any other witnesses and did not offer any exhibits. At the close of the hearing the parties were given 15 days within which to file post-hearing submissions to the Hearing Officer. The Division filed a timely Proposed Recommended Order. Mr. Fields did not file any post-hearing submission to the Hearing Officer.

FINDINGS OF FACT

Based on the testimony of the witnesses and the exhibits received in evidence at the hearing, I make the following findings of fact:

1. On January 9, 1980, Richard Morgentaler, Trustee, obtained title to 574 lots in Pinecrest Estates, a subdivision located in St. Johns County, Florida. Pinecrest Estates is registered with the Division. (Pet. Ex. 1) Richard Morgentaler paid 22,960.00 for the 574 lots, or approximately $40 per lot. (Pet. Ex. 23)

   
   

2. On July 21, 1980, Richard Morgentaler conveyed 44 lots to Florida Crown Corporation. (Pet. Ex. 15) The deed reflects a documentary stamp tax of 8.80. Murray Fields was the president and sole stockholder of Florida Crown Corporation. (Pet. Ex. 20) The Corporation was formed on July 17, 1980, only 4 days before the corporation obtained title to the 44 lots from Richard Morgentaler. On August 29, 1980, Richard Morgentaler also conveyed 10 lots in Pinecrest Estates to Murray Fields. (Pet. Ex. 18) Neither Florida Crown Corporation nor Murray Fields has ever been registered with the Division to offer or sell subdivided lands. (Pet. Ex. 2)

   
   

3. On August 29, 1980, Shirley Arthur purchased 9 lots in Pinecrest Estates from Richard Morgentaler, Trustee, for $21,860.00. (Pet. Ex. 16 & 22) Present at the closing in Morgentaler's office were Shirley Arthur, Murray Fields, Barry Shelomith and Richard Morgentaler. Shirley Arthur had previously met Murray Fields when Murray Fields became her driving instructor. As a friendship developed between Shirley Arthur and Murray Fields, Shirley Arthur placed a great deal of trust and confidence in Murray Fields. Murray Fields told Shirley Arthur about some allegedly great investments in land through Barry Shelomith, who was described by Fields as "liquidator of estates." Fields and Shelomith presented brochures about Pinecrest Estates and the surrounding area and made many representations to Shirley Arthur about the value of the land as well as potential development in the area. (Pet. Ex. 21) Murray Fields also told Shirley Arthur that he was buying 10 lots in Pinecrest Estates at the same time. Shirley Arthur's belief that Murray Fields was buying lots at the same time was a major factor in her decision to purchase, because of the trust she placed in Murray Fields. Shirley Arthur was not given a public offering statement prior to or at the closing. At no time did Murray Fields disclose to Shirley Arthur the adverse features of the land, the absence of roads to the subdivision, the absence of roads in the subdivision, or the amount of water continually covering the subdivided land. (Testimony of Shirley Arthur; Pet. Ex 4)

   
   

4. As president of Florida Crown Corporation, Murray Fields sold subdivision lots to many individuals from July 1980 to July 1981. (Pet. Ex. 5 through 14) Most of these deeds reflect documentary stamp taxes in the amount of

   $5.20 to $13.60). 1/

   
   

   CONCLUSIONS OF LAW

   
   

5. Based on the foregoing findings of fact, the relevant statutory provisions, and the applicable legal principles, I make the following conclusions of law:

   
   

6. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this case. Section 120.57, Florida Statutes.

7. Section 498.023, Florida Statutes, provides in part:

   
   

   Unless the subdivided lands are exempt or the transaction is exempt pursuant to s. 498.025:

   1. No person may offer or dispose, or participate in an offer or disposition of, any interest in subdivided lands located in this state, nor may

      any person offer or dispose of, or participate in an offer or disposition of, any interest in subdivided lands located without this state to persons in this state, nor may any person within this state offer or dispose of, or participate

      within this state in any offer or disposition of, any interest in subdivided lands located without this state to persons located without this state, unless such person has a valid order of registration therefore.

   2. No person may dispose of, or participate in the disposition of, any interest in subdivided lands unless a current public offering statement is delivered to the purchaser

      prior to the disposition, the purchaser is afforded a reasonable opportunity to examine the public offering statement prior to the disposition, and the contract and public offering statement

      used contained a provision which authorizes the purchaser to cancel the agreement without cause until midnight of the seventh day after execution by the purchaser.

      
      

8. Section 498.023 must be read together with the definition in Section 498.005(5) and (9):

   
   

   5. "Disposition" means any transaction involving any interest in subdivided lands which is

   entered into for profit, including any sale, resale, lease for more than five years, assign- ment, or award by lottery of any interest in subdivided lands,

   * * * * * *

   9. "Offer" includes every inducement, solicitation, or attempt to encourage a person to acquire any interest in subdivided lands, if undertaken for gain or profit.

   
   

9. It is clear from the evidence in this case that Murray Fields entered into transactions involving the purchase and sale of lots in Pinecrest Estates for profit and that he offered or participated in the offer of subdivided lands for profit. The evidence in this case also establishes that neither Murray Fields nor Florida Crown Corporation was registered with the Division to offer or sell subdivided lands. The evidence also establishes that at least one of the purchasers was not provided with a public offering statement prior to purchasing lots in Pinecrest Estates. On the basis of the foregoing it is concluded that Murray Fields" has violated both Section 498.023(1) and Section 498.023(2), Florida Statutes.

10. Section 498.051, Florida Statutes, provides in pertinent part:

    
    

    1. The Division may issue an order requiring a person to cease and desist, and to take

       such affirmative action as in the judgement of the Division will carry out the purpose of this chapter if the Division determines that the person has:

       1. Violated any provision of this chapter;

       2. Directly or through an agent or employee knowingly engaged in any false, deceptive, or misleading advertising, promotional, or sales methods to offer or dispose of any interest in subdivided lands.

       
       

11. Section 498.049(4), Florida Statutes, provides in part:

    
    

    The Division may, by order, impose civil penalties against any persons for viola tions of this chapter or rules relating hereto. Such imposition of a civil penalty

    shall not preclude the Division from invoking any other appropriate remedy authorized by this chapter... No civil penalty so imposed shall exceed $10,000 for each offense....

    
    

    RECOMMENDATION

    
    

    On the basis of all of the foregoing it is recommended that the Department of Business Regulation, Division of Florida Land Sales and Condominiums, issue a Final Order as follows:

    
    

    1. Ordering Murray Fields to cease and desist from offering or disposing and from partici pating in the offer or disposition of interests in Pinecrest Estates or any other subdivided

       lands until he has a valid order or registration, delivers a current public offering statement,

       and otherwise complies with Chapter 498, Florida Statutes: and

       
       

    2. Ordering Murray Fields to pay to the Division, within 30 days from the entry of the Final Order, a civil penalty in the amount of $5,000 for violation of Section 498.023(1) and Section 498.023(2), Florida Statutes.

DONE and ORDERED this 28th day of September, 1984, at Tallahassee, Florida.

MICHAEL M. PARRISH

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 28th day of September, 1984.

ENDNOTE

1/ In making the foregoing findings of fact I have relied primarily on the testimony of Shirley Arthur and on the exhibits received in evidence. I have given very little credit to the testimony of Murray Fields because most of his testimony was merely a disclaimer of knowledge and most of his efforts at ex- culpatory statements were either implausible or in conflict with other evidence in the record. Further, some of Murray Fields' testimony tended to incriminate than to exculpate; such as his testimony that he signed, a number of blank deeds and left them with Barry Shelomith.

COPIES FURNISHED:

Thomas L. Barnhart, Staff Attorney Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301

Murray Fields

Post Office Box 600474

North Miami Beach, Florida 33160

E. James Kearney, Director Department of Business Regulation Division of Florida Land Sales and Condominiums

The Johns Building 725 S. Bronough Street

Tallahassee, Florida 32301

Docket for Case No: 84-000834

Orders for Case No: 84-000834