STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE )

AND TREASURER, )

)

Petitioner, )

)

vs. ) CASE NO. 86-0095

)

ROBERT T. MARSH, )

)

Respondent. )

)

RECOMMENDED ORDER

For Petitioner: Robert D. Tritschler, Esquire

Department of Insurance Tallahassee, Florida

For Respondent: Thomas F. Woods, Esquire

Tallahassee, Florida

This matter was heard on April 7, 1986, in Tallahassee, Florida by William

1. Dorsey, Jr., the Hearing Officer designated by the Division of Administrative Hearings. Proposed Recommended Orders have been submitted by both parties and rulings on proposed findings are included in the appendix to this Recommended Order.

   
   

   ISSUE

   
   

   The issue is whether the registration of Robert T. Marsh as a motor vehicle service agreement company salesman should be revoked. The Superintendent of Insurance of the State of New York revoked the licensure of Mr. Marsh under Section 117 of the Insurance Law of that state and Mr. Marsh failed to acknowledge this on his application for licensure in Florida, despite a specific question requiring disclosure of such information. This demonstrates a lack of fitness or trustworthiness to engage in the business authorized under Chapter 634, Florida Statutes. Mr. Marsh's license should be revoked.

   
   

   FINDINGS OF FACT

   
   

   1. Mr. Marsh became licensed 1/ as a motor vehicle service agreement company salesman in Florida in 1984.

      
      

   2. On May 11, 1977, the Superintendent of Insurance of the State of New York revoked all casualty insurance licenses of Robert T. Marsh under Section

      117 of the Insurance Law of the State of New York because he failed to account for premium funds collected from clients and violated agreements regarding the payment of unearned commissions due to insurers (Petitioner's Exhibit 2a, Tr.

      page 13, line 9). In his findings of fact, conclusion and decision the Superintendent of Insurance also found that letters directed to Mr. Marsh regarding complaints filed with the New York Insurance Department were ignored, and such action reflected adversely upon Mr. Marsh's trustworthiness (id).

      
      

   3. The Insurance Department of the State of New York notified Mr. Marsh that his license had been revoked by certified mail dated June 28, 1977. The return receipt for that letter shows that it was received by Mr. Marsh on June 28, 1977 (Petitioner's Exhibit 4); Mr. Marsh admitted during the hearing that he received the notification from the New York Department of Insurance (Transcript

      p. 13 lines 2 and 3).

      
      

   4. Mr. Marsh applied for registration in Florida as a motor vehicle service agreement company salesman using Department form DI4-161 on August 31, 1984 (Petitioner's Exhibit 1). That form posed the question

      
      

      "Has your application for license ever been declined by this or any other Insurance Department or has your license or eligibility to hold a license ever been declined, suspended, revoked, placed on probation or administrative fine levied?

      If answer is "YES," give full details: Mr. Marsh answered no.

   5. The Department of Insurance learned that Mr. Marsh's license in the State of New York had been revoked after he received his Florida motor vehicle service agreement salesman license. The Department then sought an explanation of his original answer to question 5 above in an amended application filed December 13, 1985 (Petitioner's Exhibit 3). In his amended application Mr.

      Marsh then stated

      
      

      "To my knowledge my license was never suspended or revoked . . . I had mail going to many different addresses and know that I didn't receive all of it." (Petitioner's Exhibit 3)

      
      

      Mr. Marsh's testimony at the hearing that he signed the return receipt for the revocation notice, as well as the copy of the return receipt for the revocation letter from the Insurance Department of the State of New York rendered this first explanation unworthy of belief.

      
      

   6. Mr. Marsh explained at the hearing that he thought question 5 referred only to discipline of a service agreement license, but the New York revocation was for a casualty license, and therefore did not have to be disclosed (Transcript, p. 13, lines 6-9). Not only is this a strained interpretation of the question, it is not the explanation Mr. Marsh gave to the Department in his amended application, and apparently was developed between the date of the amended application and the date of the final hearing. This belated excuse for nondisclosure of the New York license revocation is also rejected.

      CONCLUSIONS OF LAW

      
      

   7. Mr. Marsh is charged with violations of Sections 634.181(1), (5) and 634.191(1), Florida Statutes (1983). Section 634.181, Florida Statutes (1983) provides:

      
      

      "The department shall deny, suspend, revoke, or refuse to renew or continue the registration of any such salesman if it finds that as to the salesman any one or more of the following applicable grounds exist:

      1. Material misstatement, misrepresentation or fraud in registration.

         * * *

         (5) For demonstrated lack of fitness or trustworthiness to engage in the business authorized under this part."

         
         

         Section 634.191(1), Florida Statutes (1983), provides:

         
         

         "The department may, in its discretion, deny, suspend, revoke, refuse to renew or continue the registration of any salesman if it finds that as to the salesman any one or more of the following applicable grounds exist under circumstances for which such denial, suspension, revocation or refusal is not mandatory under section 634.181:

         (1) For any cause for which granting of the registration could have been refused had it then existed and been known to the department."

         
         

   8. The State of New York not only revoked the license of Mr. Marsh under the Insurance Law of the State of New York, but found that Mr. Marsh's failure to answer letters from that Department reflected adversely upon his trustworthiness. Even without that specific finding, however, the substantive findings that Mr. Marsh breached fiduciary duties imposed under the New York Insurance Law by failing to account for premium funds collected and by violating agreements regarding payments of unearned commissions certainly constituted a lack of fitness or trustworthiness to engage in the business of insurance in New York. While these acts occurred in 1977, well before Mr. Marsh was licensed in Florida, the further misstatements recently made by Mr. Marsh rejected in Findings of Fact 4, 5 and 6 above show that he conducted himself in an untrustworthy fashion in obtaining his Florida licensure through misstatements or misrepresentations about his past.

      
      

   9. The Department of Insurance has demonstrated that Mr. Marsh has violated Sections 634.181(1), (5), Florida Statutes (1983). Under that statute, suspension or revocation of his license is mandatory.

      
      

   10. The Department has also proceeded under Section 634.191(1), Florida Statutes (1983), which authorizes the Department to suspend or revoke a license for any cause for which the granting of registration could have been refused had it then existed and been known to the Department. Section 634.171, Florida Statutes (1983) provides that the motor vehicle service agreement companies or insurers must register the name and business address of each of their salesmen

and pay a filing fee for each of them. It also provides that no employee or salesman may solicit or negotiate automobile warranty insurance contracts unless "so qualified and licensed therefor under the Florida Insurance Code." Section 634.171, Florida Statutes (1983). Mr. Marsh points out in his Proposed Recommended Order that Section 634.171 appears to be "more in the nature of a revenue statute than a regulatory statute" because it does not set any training requirements, testing requirements, or prescribe any qualifications for the license. It is something more than a mere revenue statute requiring issuance of the license as a ministerial act, given the compulsory grounds for discipline or denial of licensure found in Section 634.181; compare Section 120.52(8), Florida Statutes (1983). While Section 634.171, Florida Statutes (1983) describes no character or training requirements to become a salesman, the provisions of Section 634.021, Florida Statutes (1983) give the Department authority to adopt rules "necessary and proper to effectuate any provisions of this act." Application form DI4-161 has been adopted in Rule 4- 38.071, Florida Administrative Code. Coupled with the statutory discretion to deny, suspend or revoke licensure for any cause for which granting of a registration could have been refused, the Department is authorized to require Mr. Marsh to truthfully answer question 5 concerning his past insurance licensure revocation. Moreover, Mr. Marsh has not challenged the authority of the Department to require applicants for licensure to make such disclosures.

RECOMMENDATION

It is recommended that the motor vehicle service agreement company salesman license issued to Robert T. Marsh be REVOKED for misstatements or misrepresentations made in his application for licensure which have demonstrated a lack of fitness or trustworthiness to engage in business authorized under Chapter 634, pursuant to Sections 634.181(1), (5) and 634.191(1), Florida

Statutes (1983).

DONE AND ORDERED this 7th day of May 1986, in Tallahassee, Florida.

WILLIAM R. DORSEY, JR.

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 7th day of May 1986.

ENDNOTE

1/ The relevant statutes speak of "registration" as well as licensure as a motor vehicle service agreement company salesman. Sections 634.171, 634.181 and 634.191, Florida Statutes (1983). The Amended Administrative Complaint alleges that Mr. Marsh was "licensed" and this was admitted by Mr. Marsh in his Answer to Amended Administrative Complaint filed March 27, 1986. Under Section 120.52(8), Florida Statutes (1985), the terms "registration" and "licensure" are interchangeable for purposes of this revocation proceeding.

APPENDIX TO RECOMMENDED ORDER CASE NO. 86-0095

The following constitute my specific rulings pursuant to Section 120.59(2), Florida Statutes (1985) on the proposed findings of fact submitted by the parties.

Rulings on Proposed Findings of Fact Submitted by Petitioner

1. Covered in Finding of Fact 1.

2. Covered in Finding of Fact 4.

3. Covered in Finding of Fact 3.

4. Covered in Finding of Fact 2.

5. Covered in Finding of Fact 5.

6. Covered in Finding of Fact 3.

7. Rejected as irrelevant and cumulative in view of the foregoing Findings of Fact.

The Proposed Recommended Order submitted by Respondent contains no Findings of Fact but is limited to legal argument which is dealt with in the Conclusions of Law in the Recommended Order.

COPIES FURNISHED:

Honorable William Gunter State Treasurer and Insurance

Commissioner

The Capitol, Plaza Level Tallahassee, Florida 32301

Don Dowdell, Esquire General Counsel Department of Insurance The Capitol, Plaza Level

Tallahassee, Florida 32301

Richard T. Tritschler, Esquire Department of Insurance

413-B Larson Building Tallahassee, Florida 32301

Thomas F. Woods, Esquire 1030 E. Lafayette Street Suite 112

Tallahassee, Florida 32301

Docket for Case No: 86-000095

Orders for Case No: 86-000095