STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) Case No. 85-2976

)

RONALD GILBERT RICE, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, W. Matthew Stevenson, held a formal hearing in this case on December 4, 1985 in Naples, Florida. The following appearances were entered:

APPEARANCES

For Petitioner: James H. Gillis, Esquire

Department of Professional Regulation Division of Real Estate/Legal

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802

For Respondent: J. Stephen Crawford, Esquire

12751 Cleveland Avenue, Suite 207 Ft. Myers, Florida 33907

The issue for determination at the final hearing was whether Respondent committed the allegations contained in the Administrative Complaint. Specifically, the complaint alleged that Respondent:

1. Operated as a real estate broke or salesman without being the holder of a valid and current license;

   
   

2. Operated as a broker or has operated as a real estate salesman for a person not registered with his employer, and/or;

3. Committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealings by trick, scheme or device, culpable negligence and/or breach o f trust in a business transaction, all in violation of Chapter 475.25, Florida Statutes (1983).

PROCEDURAL BACKGROUND

The Administrative Complaint was filed with the Department of Professional Regulation on August 1, 1985. By letter dated August 23, 1985, the Respondent disputed the allegations of fact contained in the Administrative Complaint and requested a formal hearing before a Hearing Officer appointed by the Division of Administrative Hearings. This cause came on for final hearing on December 4, 1985. At the final hearing, Petitioner presented the testimony of three (3) witnesses. Inc. addition, Petitioner's Exhibits 1-5 were offered and duly received into evidence. The Respondent testified in his own behalf and submitted Respondent's Exhibit 1 for consideration.

FINDINGS OF FACT

Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, I hereby make the following findings of fact:

1. Respondent is and was at all times material hereto a registered real estate salesman in the State of Florida having been issued license no. 0390547.

   
   

2. In March of 1985, the Respondent's real estate salesman's license was placed with Raymond Joseph Deangelis Investments (RDI) in Naples, Florida. Since March of 1985, Respondent has had a couple of transactions that have actually closed with Mr. Deangelis.

   
   

3. Prior to being placed with RDI, the Respondent's registration certificate was placed with EVI Properties, Inc., in Naples, Florida. EVI was a registered corporation. On March 31, 1984, the corporate registration of EVI Properties, Inc was canceled due to non-renewal. Some confusion exists in the Florida Real Estate Commission's records as to when the licenses of the associates of EVI were cancelled. By letter dated January 4, 1985, to EVI Properties, Inc., the Records Section stated:

   
   

   "In reviewing the Division's Records, I find that registration held by your corporation/ partnership expired on 3/31/84 and no renewal has been processed as of the above date.

   For your convenience, I am enclosing proper form 400.3 on which to request renewal of your corporation/partnership. I suggest that same be filed within 20 days from the date of this letter, otherwise we have no alternative than to cancel the licenses of all associates with your corporation/ partnership. . ." (Emphasis Added)

   
   

   Further, the Respondent was issued a salesman's license effective November 17, 1984, expiration date 3/31/86, registered with EVI Properties, Inc. Although that license was apparently issued in error, the Respondent received no further communication regarding it from the Record's Section. Nevertheless, the Respondent was aware that he did not possess a valid current registration certificate as a salesman during the times material to this complaint. The Respondent enrolled in and completed a 12 hour Bert Rodgers Schools of Real Estate course and re-applied for a current registration certificate. The new registration certificate was issued effective March 18, 1985.

   
   

4. During the time that Respondent's registration certificate with EVI Properties was cancelled, he was also employed as vice-president of American Home Funding, a large New York based mortgage firm. As vice-president with American Home Funding, the Respondent was in charge of their Florida organization as a mortgage broker. The Respondent has been licensed as a mortgage broker in Florida since 1981.

   
   

5. While the Respondent was associated with EVI Properties no transactions transpired and he inadvertently failed to maintain a valid and current registration certificate as a real estate salesman.

   
   

6. From April 1, 1984 through March 17, 1985, Respondent did not possess a valid and current registration as a real estate salesman.

   
   

7. In June 1984, the Respondent met Mr. James D. Peterson. Mr. Peterson is the owner of several nursing home facilities located in Rhinelander, Wisconsin, Florida, and Illinois. The Respondent attempted to arrange permanent financing for Mr. Peterson for Some property known as Buena Vida, in Naples. However, the transaction was never consummated.

   
   

8. The Respondent, in reviewing Mr. Peterson's financial statements while attempting to arrange financing for him, became aware of a nursing home facility owned by Peterson in

   Rhinelander, Wisconsin. At the time, the Rhinelander nursing facility was not for sale.

   
   

9. In October 1984, the Respondent met Deborah M. Maclean, a real estate sales person at a cocktail party. The party was attended by the Respondent, Mr. Corcelli an attorney and CPA, Mr. Corcelli's partner, Joseph Moore, an, attorney and the owner of Naples Title Company and Ms. Debra Maclean. The Respondent had arranged a S1.8 million dollar construction loan for Mr. Corcelli and Mr. Moore to build a facility on Vanderbilt Beach. As a result of obtaining that mortgage loan commitment, and following the closing, the Respondent invited Mr. Corcelli and Mr. Moore and his wife to his home for cocktails. As his guest, Mr. Corcelli brought Deborah Maclean.

   
   

10. During the course of the evening at the dinner party, Respondent and Mr. Corcelli were discussing the real estate industry and Respondent mentioned Mr. Peterson. The following day, Ms. Maclean called Respondent and informed him that she was aware of a company which had a strong interest in purchasing nursing home facilities anywhere in the United States. The firm was called Canadian International Health Services' Inc. Ms. Maclean related to the Respondent that she had all cash buyers". Ms. Maclean contacted the Respondent several times requesting that she be introduced to Mr. Peterson, but Respondent refused. Apparently, Respondent was concerned that he might lose an anticipated mortgage brokerage commission because Ms. Maclean had "all cash" buyers.

    
    

11. At some point, Ms. Maclean went to the Rhinelander facility and told one of Mr. Peterson's key employees that she had a buyer for any, end all of their facilities, and in particular the Rhinelander facility.

    
    

12. Mr. Peterson decided to sell the Rhinelander nursing home facility, but preferred to deal with Respondent rather than Ms. Maclean. Mr. Peterson, therefore, employed Respondent to serve as a shield between he, Mr. Peterson, and Ms. Maclean during negotiations for the sale of the nursing home facility.

    If a sale had resulted, Respondent expected to be compensated by the sellers at the rate of 4% of the selling price of $13,000,000 less the value of the inventory. The Respondent agreed to share his commission 50/50 with Deborah Maclean.

    
    

13. In December of 1984 and May of 1985, a meeting was held between Ms. Maclean, her attorney George P. Langford, and Respondent to further discuss the sale of the facility and any fee arrangements. Respondent informed Mr. Langford that he did not have a current license, but Respondent stated that he felt

    that the transaction primarily involved a business and not real property.

    
    

14. Respondent did not state to any of the persons involved that he had the "listing" for the Rhinelander property. However, Mr. Peterson informed Ms. Maclean that there was a detailed listing for the property.

    
    

15. Respondent's employing broker, Raymond J. Deangelis, did not discover that Respondent was attempting to obtain a purchaser for the Wisconsin property through sales negotiations with Deborah Maclean until May, 1985. None of the negotiations or documents involved in the attempted sale of the Rhinelander property were routed through Respondent's broker.

    CONCLUSIONS OF LAW

    
    

    The Division of Administrative Hearings has jurisdiction of the parties to, and the subject of, this proceeding. Section 120.57(1), Florida Statutes (1983). This proceeding is penal in nature and burden of proof is on the Petitioner. Bach vs.

    Florida Board of Dentistry 378 So.2d 34 (Fla. 1st DCA 1980); Balino vs. Department of Health and Rehabilitative Services, 348 So.2d 349 (Fla. 1st DCA 1977). Because the Respondent's license is at stake, the evidence to support the charges must be more substantial than that required to support conventional forms of regulatory action. Under these circumstances, Bowling vs.

    Department of Insurance 394 So.2d 165 (Fla. 1st DCA 1981) requires the evidence weigh as substantially on the scale for evidence as the penalty does on the scale of penalties.

    Accordingly, the findings here made are predicated upon a showing of clear and convincing evidence and the scale of the penalty is aligned with that of the scale of the evidence.

    
    

    Count I of the Administrative Complaint charges that the Respondent is guilty of having operated as a real estate broker or salesman without being the holder of a valid and current license as a real estate broker or salesman in the State of Florida in violation of §475.25(1)(a), Florida Statutes, and therefore, in violation of §475.25(1)(e), Florida Statutes.

    Section 475.25, Florida Statutes (1983) provides in part that:

    
    

    "(1) 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 offense; and may issue a reprimand,

    or any or all of the foregoing, if it finds that the licensee, permittee, or applicant;

    
    

    1. has violated any provisions of s. 475.42 or of s. 455.227(1).

(e) 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."

Section 475.42 (l)(a), Florida Statutes (1983) provides that:

"No person shall operate as a broker or salesman without being the holder of a valid and current license there fore."

The term operating as a broker or salesman is deemed to mean the Commission of one or more acts described in Section 475.01(1)(c), Florida Statutes as constituting or defining a broker or salesman. Section 475.01(1)(c), Florida Statutes provides in part that:

"Broker" means a person who, for another, and for a compensation or valuable consideration directly or indirectly paid or promised, expressly or implied, or with an intent to collect or receive a compensation of valuable consideration therefore, appraisers, auctions, sales, exchanges, buyers, rents, or offers, attempts or agrees to appraise, auction

or negotiate the sale, exchange, purchase, or rental of business enterprises or business opportunities or any real property or any interest in or concerning the same . . . or who takes

any part in the procuring of sellers, purchasers, leases, or lessees of business enterprises or business opportunities or the real property of another . . . or who directs or assists in the procuring of prospects or in the negotiation or closing of any transaction

which does, or is calculated to, result in a sale, exchange, or leasing thereof,

and who receives, expects, or is promised any compensation or valuable consideration, directly or indirectly therefore . . . "

A salesman is any person who performs any act specified in the definition of broker, but who performs such act under the direction or control of another person. The Petitioner has established by clear and convincing evidence that the Respondent, Ronald Gilbert Rice, operated as a real estate salesman without being the holder of a valid and current registration certificate in the State of Florida. It is clear that the Respondent actively took part in the attempted sale of Mr. Peterson's Rhinelander Nursing Home facility to American-Canadian International, Inc. The Respondent's assistance to Mr. Peterson in the attempted sale of the Rhinelander facility was provided with the clear expectation that Respondent would receive

compensation and valuable consideration. The Respondent is guilty of having operated as a real estate broker or salesman without being the holder of a valid and current registration certificate in violation of Sections 475.25(1)(a) and (e), Florida Statutes (1983).

Count II of the Administrative Complaint, charges that the Respondent operated as a broker or as a real estate salesman for a person not registered as his employer in violation of Section 475.42(1)(b), Florida Statutes and therefore in violation of Section 475.25(1)(e), Florida Statutes. Section 475.42(b) provides that:

"No person licensed as a salesman shall operate as a broker or operate as a salesman for any person not registered as his employer."

During the initial stages of the Rhinelander nursing facility negotiations, the Respondent was not licensed and had no employing broker. During the final stages of negotiations for the sale of the Rhinelander facility, the Respondent was registered with Raymond Deangelis Investments. The Respondent acted independently of Raymond Deangelis Investments during the attempted negotiation of the Rhinelander transaction. The, acts of the Respondent were on-behalf of someone other than his employing broker of record during that period of time in which he should have been working directly with his broker. The Respondent is guilty of having operated as a real estate salesman for a person not registered as his employer in violation of Sections 475.25(1)(e) and 475.42(1)(d), Florida

Statutes (1983).

Count II charges that the Respondent is guilty of 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 violation of Section 475.25(1)(b), Florida Statutes. There is no competent and substantial clear and convincing evidence to show that the Respondent committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or devise, culpable negligence or breach of trust in any business transaction. There was no credible evidence adduced which established that the Respondent told any of the parties involved that he held a current registration certificate as a real estate salesman. In fact, Ms. Maclean's attorney testified that Respondent informed him early on that he was not licensed and Ms. Maclean was well aware that Respondent was not licensed. The Respondent acted initially upon his erroneous assumption that he did not need a current registration certificate as a real estate

salesman to receive a "fee" for his involvement in this transaction. The Respondent is not guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence or breach of trust in a business transaction as alleged in Count III of the Administrative Complaint.

RECOMMENDATIONS

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that The Florida Real Estate Commission suspend the real estate salesman's license of Respondent Ronald Gilbert Rice for a period of 6 months and that an administrative fine of $500 be assessed.

DONE and ORDERED this 8th day of January, 1986 in Tallahassee, Leon County, Florida.

W. MATTHEW STEVENSON, Hearing Officer Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 8th day of January, 1986.

COPIES FURNISHED:

James H. Gillis Esquire Department of Professional

Regulation

Division of Real Estate/Legal

400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802

J. Stephen Crawford, Esquire 12751 Cleveland Avenue

Suite 207

Ft. Myers, Florida 33907

Fred Roche Secretary

130 North Monroe Street

Tallahassee, Florida 32301

Salvatore A. Carpino, Esquire General Counsel

130 North Monroe Street Tallahassee, Florida 32301

Harold Huff Executive Director

Department of Professional Regulation

Division of Real Estate

400 West Robinson Street

P. O. Box 1900

Orlando, Florida 32802

Docket for Case No: 85-002976

Orders for Case No: 85-002976