STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF STATE, )

DIVISION OF LICENSING, )

)

Petitioner, )

)

vs. ) CASE NO. 86-0900

)

VERNIE RAY BARNES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, William R. Cave, held a public hearing in the above- captioned case on June 23, 1986, in Pensacola, Florida.

APPEARANCES

For Petitioner: James V. Antista, Esquire

Department of State The Capitol

Tallahassee, Florida 32301

For Respondent: R. John Westberry, Esquire

24 West Government Street, Suite 285 Post Office Box 748

Pensacola, Florida 32594 STATEMENT OF THE ISSUE

The issue for determination is whether Respondent's Class "EE", repossessor intern license, Class "C" private investigator license, and Class "M" manager license should be revoked, suspended or otherwise disciplined for violation of Sections 493.306(2)(b) and 493.319(1)(f) and (p), Florida Statutes.

PRELIMINARY STATEMENT

By Administrative Complaint filed with the Division of Administrative Hearings on March 17, 1986, the Petitioner seeks to revoke, suspend or otherwise discipline the repossessor license, private investigator license and manager license of Respondent Vernie Ray Barnes. As grounds therefor, it is alleged that Respondent's employment and financial history demonstrates a lack of goof moral character that ther is a substantial connection between the Respondent's lack of gppd ,pra; cjaracter and that there is a substantial connection between the Respondent's lack of good moral character and the licenses he holds.

This case was improperly styled. The style is now corrected to read Department of State, Division of Licensing, Petitioner v. Vernie Ray Barnes, Respondent.

In support of its charges, Petitioner presented the testimony of Adrian Elwood Kirksey, Patricia Porto, Robert Owen Clayton, Bonnie Tramill and Shelly Bradshaw. Petitioner's Exhibits Nos. 1 through 11 and 13 were received into evidence. Respondent objected to the admission of Petitioner's Exhibit No. 12 on the ground that it pertained to matters not charged in the Administrative Complaint. Petitioner at that time moved ore tenus to amend paragraphs II and III to include matters concerning monies allegedly owed to the Citizens and Peoples National Bank of Pensacola (Bank) by the Respondent that were in default, whether reduced to judgment or not. Later int he proceeding, Petitioner also moved ore tenus to amend the Administrative Complaint to include the matter involving monies allegedly owed to Bonnie Tramill. The undersigned Hearing Officer reserved ruling on both matters and allowed the parties to submit written argument on these matters with the understandign that should the motion to amend the Administrative Complaint be enied that Petitioner's Exhibit No. 12 would not be received into evidence and all testimony in regard to these matters would be stricken.

Based upon a review of the record in this case and after considering Petitioner's motion, it is the rulingof the undersigned Hearing Officer that Petitioner's Motion to Amend the Administrative Complaint be and same is hereby DENIED and Petitioner's Exhibit No. 12 and all of the testimony of Robert Owen Clayton and Bonnie Tramill in regard to thse matters are excluded from evidence.

Respondent testified on his own behalf. Respondent's Exhibits Nos. 1 through 3 were received into evidence.

The parties submitted posthearing Proposed Findings of Fact and Conclusions of Law. A ruling on each proposed finding of fact has been made as reflected in the Appendix to this Recommended Order.

FINDINGS OF FACT

1. The Respondent applied for a Class "EE" repossessor intern license, a Class "C" private investigator license, and a Class "M" manager license from the Petitioner sometime in the latter part of August or early September 1985.

   
   

2. On January 23, 1986, Petitioner denied Respondent's application for the above-mentioned licenses primarily on the basis that Respondent lacked "good moral character" and that there was a substantial connection between the Respondent's lack of "good moral character" and the business of private investigator or repossessor for which the Respondent sought licenses.

   
   

3. Petitioner issued Respondent a Class "EE" license No. GEE8500097, a Class "C" license No. GC 8500619, and a Class "M" license No. GM8500444 on February 5, 1986. Petitioner advised Respondent by letter dated February 11, 1986, that the denial had been rescinded, the licenses issued, and an Administrative Complaint filed to revoke those licenses. The letter further stated that the reason for issuing the licenses was based solely on the Petitioern's failure to comply with the 90 day requirement in Section 120.60(2), Florida Statutes. Respondent currently holds the above-mentioned licenses.

   
   

4. Respondent was employed by the Escambia County Sheriff's Department (Department) on January 3, 1975.

   
   

5. On January 2, 1985, Respondent was give a letter of reprimand for an alleged violation of Section 21.111, Escambia County Sheriff's Manual, by

   involving himself in a criminal case in which Respondent had no official standing. Petitioner presented no evidence concerning the underlying facts which resulted in the reprimand. Respondent's testimony concerning the reprimand, which I found credible, was that he had talked with someone in the State Attorney's Office about a case pending against Homer Curtis Wright (Wright) at the request of Lieutenant Newman because Lieutenant Newman though Wright was a vitim of the system, had never been convicted of crime, had four small children and did not need a felony conviction on his record. This incident occurred prior to the incident involved in Finding of Fact 6, although the letter of reprimand in this incident was written some ten months after the incident in Finding of Fact 6.

   
   

6. On April 3, 1984, Respondent was given Notice of Disciplinary Action for accepting nine pounds of coffee from inmate Wright in violation of Part II, Chapter 14, Section B, Rule 11, Corrections Division, Jail Operations Manual, Escambia County Sheriff's Department and Rule 33-803(2), Florida Administrative Code. However, it was later determined that Respondent had been authorized by the "Officer in Charge" to acept the coffee for use in the jail and the disciplinary actiosn were withdrawn by the Department.

   
   

7. On May 10, 1985, Respondent was issued a Notice of Disciplinary Action alleging that Respondent had cashed five out-of-town checks made payable to Wright and drawn on Mary Odom, knowing that Wright was a convicted felon, and withholding $450.00 from the monies received for those checks, and representing ot Wright that the money withheld was a fee charged by the bank for cashing the checks. On the basis of this allegation, Respondent was charged with violation of the Escambia County Sheriff's Department Policy of associating with known criminals in violation of Policy No. 21.107, of assisting criminals in violation of Policy 21.105, with conduct unbecoming an officer in violation of Policy No. 21.87, and compromising an officer's integrity in violation of Policy No. 21.89.

   
   

8. Respondent filed a Notice of Appeal of this disciplinary action with the Escambia County Civil Service Board (Board).

   
   

9. In October 1985 prior to this matter being heard by the Board, the Respondent and the Department entered into a Stipulated Agreement whereby the disciplinary action was amended to a single charge of conduct unbecoming an officer in that Respondent used poor judgment. The disciplinary action was further amended to provide for a 30 day suspension rather than a dismissal and for Respodnent to receive back pay from June 10, 1985, the day after the 30 day suspension ended, until October 16, 1985, the day the stipulation was signed. In return, Respondent agreed to dismiss his appeal with the Board and voluntarily retire from the employ of the Department.

   
   

10. There was insufficient evidence to prove that Respondent advised Wright that the bank charged a fee for cashing the checks drawn on Mary Odom made payable to Wright and withholding $450.00 for that purpose. Wright freely gave the Respondent $450.00 for getting the bank to cash 5 checks drawn on Mary Odom made payable to Wright, because Wright was unable to get them cashed and that Wright only brought charges against Respondent after he and Respondent had a disagreement concerning the payment of work performed for Respondent by Wright.

    
    

11. There was insufficient evidence to prove that Respondent knew or should have known that Wright was trying to defraud Mary Odom. In fact, Mary

    Odom was advise to pursue this matter civilly rather than criminally, because there was insufficient evidence to prove conspiracy with intent to defraud by Wright. There was no evidence that Mary Odom proceeded against Wright or the Respondent civilly.

    
    

12. On occasions, Wright worked for the Respondent, however, other officers within the Department worked what could be referred ot as "known criminals" without being disciplined by the Department.

    
    

13. There was no evidence that Respondent "socialized" with any "known criminals" other than Wright. Respondent's "socializing" with Wright could best be described as using poor judgment rather than "associating with known criminals" to the extent that he was "assisting criminals" in performing illegal acts.

    
    

14. During Respondent's employment with the Department he received numerous letters of commendation. Major Adrian Kirksey supervised Respondent for two years during which time Respondent performed his duties without any problems.

    
    

15. If the discipline sought of an employee of the Department was less than dismissal or termination, the Department determined the appropriateness of the discipline given an employee and there was no opportunity for the disciplined employee to have a hearing before the Sheriff of Escambia County.

    
    

16. The Bank obtained a judgment against Respondent in the sum of $450.00 on September 16, 1980, on a Master Card account which was satisfied on August 19, 1982.

    
    

17. The Bank obtained a judgment against Respondent in the sum of $952.00 on January 15, 1980, which was satisfied on March 27, 1980.

    
    

18. On July 29, 1985, the Federal Home Loan Mortgage Corporation obtained a final judgment of foreclosure on Respondent's residence in the sum of

    $76,650.23. The certificated of title was issued to Federal Home Loan Mortgage Corporation on September 3, 1985, after it was the successful bidder on the property at $77,286.27. This foreclosure action also involved a second mortgage to the Bank in the amount of $17,420.95 which has been charged to reserve for bad debts by the bank.

    
    

19. On March 5, 1985, the Liberty Bank of Cantonment obtained a final judgment of foreclosure against the Respondent on property located in Escambia County and was issued a certificate of title to the property on April 16, 1985, after being the successful bidder.

    
    

20. On April 20, 1981, the Bank obtained a Final Judgment of Foreclosure against Respondent in the sum of $45,506.31 on a parcel of commercial property located on Navy Boulevard in Pensacola, Florida, and secured a certificate of title on May 27, 1981, after being the successful bidder. After obtaining the certificate of title, the bank was unable to sell the property and, on November 19, 1984, resold the property to Respondent for which he executed a note in the amount of $48,000.00. Respondent made some payments on this note, but on December 30, 1985, the balance of $47,241.42 was charged off to Reserve for Bad Debts by the Bank.

21. On August 28, 1985, Respondent and his wife, Carla Gail Barnes, filed a Suggestion of Bankruptcy. There was no evidence introduced as to what title bankruptcy was filed.

    
    

22. Respondent was a member of the Escambia County Employees Credit Union (Credit Union) from sometime in 1974 until 1980 when his membership ended. During Respondent's membership, he applied for and received a loan on property located in Santa Rosa County, Florida, specifically Jay, Florida, in the amount of $13,000.00 based on an appraisal submitted by A. A. O'Daniel, Appraiser for the Credit Union, to Respondent showing the property to have a value of

    $15,500.00. Respondent defaulted on this loan and the Credit Union foreclosed on the property. The Credit Union sold the property for $4,000.00 and obtained a deficiency judgment in the amount of $16,766.65. There was insufficient evidence to show whether the appraiser made a mistake as to value or appraised the wrong parcel of property, but at the time of foreclosure another appraiser valued the parcel of property at $4,000.00. There was no evidence that Respondent influenced the original appraiser in any manner to inflate his appraisal. The deficiency judgment has not been satisfied, but Respondent's appeal of the deficiency judgment was not rendered by the appellate court until May 14, 1986.

    
    

23. On November 18, 1977, Respondent signed a mortgage deed on property described as the Navy Boulevard property to secure a promissory note given to the Credit Union on the same date in the sum of $38,057.00. The mortgage deed was improperly executed in that his signature was neither witnessed nor acknowledged. This mortgage, for whatever reason, was never recorded. At the time Respondent borrowed this money, the property was not deeded to Respondent. It was in early 1978 that Respondent discovered that Charles Bryan, the manager of the Credit Union, had had the property deeded to himself, and in August of 1978 Respondent was able to get Charles Bryan to deed the property to him. It was after Respondent received title to the property that he proceeded to borrow money from the Bank and give the Bank a mortgage deed on this property to secure the promissory note mentioned in paragraph 20. Although Patricia Porto testified that the Credit Union never received any of this money borrowed from the Bank by Respondent, the Respondent's testimony, which I find credible, was that two checks were given to Charles Bryan for the Credit Union to pay off the promissory note given by Respondent to the Credit Union mentioned above. There was no evidence that Charles Bryan gave this money to the Credit Union.

    
    

24. During the period that Charles Bryan was managing the Credit Union, there were several checks drawn on the Credit Union made payable to Respondent that the Credit Union treated as loans made by Respondent although thgere were no loan applications, promissory notes or other necessary documentation required by Credit Union policy in the files of the Credit Union. These checks were signed by Charles Bryan, Linda S. Hurd, and Linda F. Steadman. Although Respondent was joined in a civil suit with Charles Bryan and Arnold Craft filed by the Credit Union to recover these funds, only a judgment against Charles Bryan was entered. The Credit Union has not attempted to proceed any further on this matter.

    
    

25. The Credit Union filed a bond claim against the bond of Charles Bryan in the amount of $200,000.00, which included actual and alleged loans of the Respondent that had not been paid, and collected 80% of that amount from the bonding company on Charles Bryan's lack of faithful performance.

    
    

26. Although Respondent defaulted on several loans, the record reveals that he did make payments on those loans. The record further reveals that even

    though Respondent defaulted on the first mortgage to the Bank, the Bank later felt that Respondent could probably handle the mortgage the second time around, but, due in part to his problem of employment with the Department, he was unable to handle it and the Bank had to write it off as a bad debt.

    
    

    CONCLUSIONS OF LAW

    
    

27. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, this proceeding. Section 120.57(1), Florida Statutes (1985).

    
    

28. The alleged misconduct on which Respondent is accused purportedly violates Section 493.306(2)(b), Florida Statutes, which is quoted below:

    
    

    (2)(b) The department may refuse to license an applicant for lack of good moral character only if:

    1. There is a substantial connection between the lack of good moral character of the applicant and the business for which the license is sought.

    2. The finding by the department of lack of good moral character is supported by clear

       and convincing evidence.

       
       

       And Section 493.319(1)(f) & (p), Florida Statutes, which is quoted below:

       
       

       (1) The following constitutes grounds for which disciplinary action specified in subsection (2) may be taken:

       * * *

       (f) Proof that the licensee is guilty of fraud or deceit, or of negligency, incompetency, or misconduct, in the practice of his business for which the license is held;

       * * *

       (p) Violating any provision of this chapter.

       
       

29. Petitioner contends that the Respondent has the burden of moving forward with the evidence in this proceeding even though Petitioern is seeking to revoke Respondent's license because it only issued the licenses due to a technicality in Section 120.60(2), Florida Statutes, which requires the issuance of a license when the agency fails to either approve or deny the applciation within 90 days of the date of the application unless the time period is tolled. For whatever reason, this is a disciplinary proceeding and the burden is up to the regulatory agency to establish facts upon which its allegations of misconduct are based. Balino v. Department of Health and Rehabilitative Services, 348 So.2d 349 (2nd DCA Fla. 1977).

    
    

30. Respondent contends that the Petitioner cannot use misconduct occurring before licensure as a basis for disciplinary action. However, in this case there is specific statutory language requiring the Petitioner to deny a license where the applicant lacks good moral character and inaction on the part of the Petitioner in failing to timely approve or deny the application cannot thwart specific legislative direction. Cirnigliaro v. Florida Police Standards and Training Commission, 409 So.2d 80 (1st DCA Fla. 1982). Therefore, facts

    concerning Respondent's employment and financial history that are relevant in showing Respondent's "lack of good moral character" and "the substantial connection between" the Respondent's "lack of good moral character" and the business in which the Respondent holds the licenses are admissible even though this conduct occurred before the licenses were issued.

    
    

31. Although Respondent used "poor judgment" in "socializing" with Wright during his tenure with the Department and was no "financial wizard" in monetary matters, the Petitioern has failed to meet its burden as set out in Section 493.306(2)(b)2., Florida Statutes, to prove that Respondent lacks "good moral character" as defined in Section 493.306(2)(a), Florida Statutes. Additionally, Petitioner has failed to meet its burden to prove that Respondent violated Section 493.319(1)(f) & (p), Florida Statutes.

RECOMMENDATION

Based on the Findings of Fact and Conclusions of Law recited herein, it is RECOMMENDED that Respondent be found not guilty of the violatons as charged in the Administrative Complaint and that Counts I through IX of the Administrative Complaint be DISMISSED.

Respectfully submitted and entered this 13th day of November 1986 in Tallahassee, Leon County, Florida.

WILLIAM R. CAVE

Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 13th day of November 1986.

APPENDIX

The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the proposed findings of fact submitted by the parties in this case.

Rulings on Proposed Findings of Fact submitted by the Petitioner.

Although paragraphs 5, 6, 13 and in part paragraph 10, are recitations of the witnesses' testimony, I have treated them as findings of fact.

1. Rejected as a Conclusion of Law rather than a fact.

2. Adopted in Findings of Fact 1 and 2.

3. Adopted in Finding of Fact 3.

4. Adopted in Finding of Fact 3.

5. Sentences 1, 4, 6, and 7 adopted in Finding of Fact 7. The first phrase of sentences 2 and 3 are adopted in Finding of Fact 7, but there is no substantial competent evidence in the record to support the balance of those

   facts and are therefore rejected. Paragraph is rejected because there is no substantial competent evidence in the record to support that finding.

6. Sentences 1 and 3 are rejected because there is no substantial competent evidence in the record to support those findings. The second sentence is adopted in Findings of Fact 16 and 17.

7. Since there is no specific finding of fact that the allegations of Count IV pertain to Respondent, paragraph 7 is adopted, but not in any particular paragraph.

8. Adopted in Finding of Fact 18.

9. Adopted in Finding of Fact 19.

10. All of paragraph 10 with the exception of the last sentence is adopted in Findings of Fact 22 and 23 as modified. The last sentence is rejected as irrelevant and immaterial.

11. Sentences 1 through 5 and 7 adopted in Finding of Fact 24, as modified. Sentence 7 adopted in Finding of Fact 25. Sentence 6 rejected as irrelevant and immaterial.

12. Sentences 1 and 2 adopted in Finding of Fact 23. The balance of paragraph 12 is rejected because there is no substantial competent evidence in the record to support that finding.

13. Rejected as argument.

14. Rejected because there is no substantial competent evidence in the record to support that finding.

Rulings on Proposed Findings of Fact Submitted by the Respondent

1. Adopted in Finding of Fact 1.

2. & 3. Rejected as immaterial and irrelevant.

4. Adopted in Finding of Fact 2.

3-7. Adopted in Finding of Fact 3.

1. Adopted in Finding of Fact 4.

2. Rejected as immaterial and irrelevant.

3. & 11. Adopted in Finding of Fact 5

1. Adopted in Finding of Fact 6

2. Adopted in Finding of Fact 7.

3. & 17. Adopted in Finding of Fact 7.

4. , 16. & 19. Adopted in Finding of Fact 12 as modified.

18. Adopted in Finding of Fact 15.

20. & 21. Adopted in Finding of Fact 14 as modified.

1. Adopted in Finding of Fact 16.

2. Adopted in Finding of Fact 17.

3. Rejected as not supported by substantial competent evidence in the record.

4. Adopted in Finding of Fact 18 as modified.

5. Adopted in Finding of Fact 19.

6. & 41. Adopted in Finding of Fact 20.

28.-31. Rejected as not supported by substantial competent evidence in the record.

1. & 34. Adopted in Finding of Fact 22.

2. , 35., 38. & 39. Adopted in Finding of Fact 23.

37. Adopted in Finding of Fact 23.

37. & 40. Adopted in Finding of Fact 24. 42.-44. Adopted in Finding of Fact 26.

COPIES FURNISHED:

Honorable George Firestone Secretary of State

The Capitol

Tallahassee, Florida 32301

James V. Antista, Esquire Department of State

The Capitol

Tallahassee, Florida 32301

R. John Westberry, Esquire

24 West Government Street, Suite 285 Post Office Box 748

Pensacola, Florida 32594

Docket for Case No: 86-000900

Orders for Case No: 86-000900