Respondents. )
The final hearing in this case was held in Tampa, Florida on October 15, 1987, before Donald D. Conn, a duly designated Hearing Officer of the Division of Administrative
Hearings. The parties were represented as follows:
For Petitioner: James R. Mitchell, Esquire
For Respondent: David S. TenBrook, Esquire
The Department of Professional Regulation, Division of Real Estate (Petitioner) filed an Administrative Complaint against A. Richard Perez, Richard Perez and Associates, Inc., and Amerimark, Inc. (Respondents) seeking license disciplinary action based upon the alleged nonpayment of real estate commissions to Beverly Givens who was employed by Respondents in 1984 as a real estate salesperson. At the hearing, Petitioner voluntarily dismissed Counts 3 and 6 of the Administrative Complaint, and thereby dismissed Amerimark, Inc., as a co- Respondent. Petitioner called five witnesses to testify and introduced twenty exhibits; Respondents called two witnesses and introduced twelve exhibits. A transcript of the hearing was filed on December 2, 1987, and the parties were allowed to file post-hearing memoranda and proposed recommended orders within ten days thereafter. The Appendix to this Recommended Order includes a ruling on each timely filed proposed finding of fact.
At all times material hereto, Respondent A. Richard Perez was a licensed real estate broker in the State of Florida, having been issued license number 0246170.
Richard Perez and Associates, Inc. was, at all times material hereto, a corporation registered as a real estate broker in the State of Florida, having been issued license number 0233722, and Respondent Perez was the qualifying broker, owner and President of said real estate corporation.
From approximately April, 1984 to approximately September 24, 1984, Respondent Perez employed Beverly Givens as a real estate salesperson. This employment was through, and in association with Richard Perez and Associates, Inc. Givens' real estate salesperson's license number is 0403324.
Givens was employed by Perez to engage primarily in the sale of condominium conversion units known as Oakbrook Village Condominiums in Clearwater, Florida. In accordance with her independent contractor and compensation agreements, commissions were earned only at such time as a sale was closed and the seller paid a commission on such sale. Further, in the event of the termination of the independent contractor agreement, the independent contractor was entitled to one-half of the regular commission for all units closed following such termination if there was a fully executed sales contract on the unit at the time of termination, and if the seller paid a commission on the sale. In addition, Givens was eligible for, and did in fact receive, a draw of $450 every two weeks from Perez beginning on April 15, 1984. Commissions earned by a salesperson were first applied against any outstanding draw balance, and after all draws were repaid, the salesperson then received excess commissions.
At the time of her termination on or about September 24, 1984, Givens had several fully executed sales contracts for units at Oakbrook Village which had not yet closed. Five of these contracts subsequently closed, as follows: Hoffman on September 28, 1984; Vollbracht on September 28, 1984; Gasser on October 5, 1984; Hakel on October 5, 1984; and Cook on October 31, 1984. Respondent Perez did not pay Givens any commissions in connection with these five closings. However, Perez only received commissions from the seller for the Hoffman, Gasser and Hakel transactions, and did not received any commissions for the Vollbracht or Cook closings.
Givens filed suit against Richard Perez and Associates, Inc., on January 14, 1985. On July 29, 1986, she received a Final Judgment against that corporation, in Case Number 85-3211-15, in the Circuit Court for Pinellas County, for unpaid commissions in the amount of $1522.29, plus $322 in interest,
$216.45 for costs and $2500 for attorneys fees, for a total of $4,560.74. Respondent Perez, as qualifying broker at the time, did not attend the trial, and said corporation was unrepresented in the proceedings. To date, Respondents have not paid or otherwise satisfied this Final Judgment.
On July 29, 1987 a Verified Motion for Relief From Final Judgment was filed in Case Number 85-3211-15 on behalf of Richard Perez and Associates, Inc., seeking to set aside the Final Judgment because of lack of notice concerning the trial date. Respondent Perez, as President of said corporation, verified this Motion. By stipulation of the parties in this case, the Verified Motion was denied.
Givens received nine checks representing draw payments of $450.00 each for the period between April 15 and August 31, 1984. In addition, she received a check dated September 20, 1984 in the amount of $4,741.84 which states thereon, "Pay back draw and commissions to date." These checks were all signed by Respondent Perez from the account of Richard Perez and Associates, Inc. Total payments received by Givens amounted to $8,791.84.
No records were produced by Petitioner or Givens to establish the commissions she was due for closings which occurred during her employment. She simply alleged that when she terminated her employment on September 24, 1984, she had paid back all draws and amounts advanced to her, and that she was therefore entitled to one-half of the normal commission on the five closings which occurred after her termination. Petitioner and Givens rely on the notation on the check she received from Respondent on September 20, 1984, and the Final Judgment in Case Number 85-3211-15 to support her allegation that when she terminated her employment, she did not owe Respondent Perez any amounts for draws and advances and that he has failed to pay her commissions to which she was entitled. Testimony offered by Petitioner of Clay Simpson and Jim Givens is given little weight due to their own expressed motivation to support Beverly Givens in her claim against Respondent, the fact they were not involved in the process of paying Respondent's salesmen, and their lack of knowledge or experience in keeping financial records.
Respondent alleges that upon Givens' termination, she owed him certain amounts for draws which had been advanced to her, and that the subsequent closings were applied against that balance due. Therefore, he maintains that he owes her nothing as a result of these five closings.
Based upon the clear and express terms of the independent contractor and compensation agreement, it is specifically found that Beverly Givens was not due any commission on the Vollbracht and Cook closings since the evidence clearly establishes that in both cases the seller did not pay Respondent any commissions in association with these sales.
Respondent Perez and Givens agree that she should be credited with a
$416.13 commission from the Hakel closing. Concerning the Gasser and Hoffman closings, Perez asserts Givens should be credited with $275.63 and $269.50, while Givens claims $321.56 and $404.25, respectively. It is therefore Perez' position that Givens' credits from these subsequent closings totalled $961.26, while Givens claims $1,141.94 from these three subsequent closings. The evidence adduced at hearing does not permit a finding to be made as to which credit amount is correct, because no testimony or documentary evidence was presented concerning the percentage of commission to be earned by the salesperson on these three transactions.
Nevertheless, even if it is assumed that the lower credit amount was due Givens, it would still appear that Respondent Perez owed her almost
$1000.00, and has improperly failed to pay her these commissions. Competent substantial evidence was offered by Petitioner in the form of the check dated September 20, 1984, in the amount of $4741.84 bearing the notation that it was for payment of "back draw and commissions to date" to establish that Givens had paid back all draws and advances through earned commissions while she was employed by Respondent Perez, and in addition thereto still had sufficient sales to receive this payment. Therefore, when she terminated on September 24, 1984, she was due commissions from Perez for the three sales which subsequently closed for which the seller had paid him a commission. While there may be a dispute as to the exact amount of commissions owed Givens, it is clear that it was between
$961.26 and $1,141.94.
The draw/commission account ledger presented at hearing by Respondent Perez allegedly showing that Givens owed him approximately $1450 is not persuasive because he testified that it was not prepared contemporaneously with the sales transactions depicted thereon, but rather was prepared after Givens' termination by a person who was not present to testify, and no records were produced to verify or substantiate the sales figures depicted on the ledger.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties and subject matter in this case. Section 120.57(1), Florida Statutes. Since this case involves proposed license disciplinary action, the Petitioner has the burden of proving the charges set forth in the Administrative Complaint by clear and convincing evidence. Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).
Respondents have been charged with violating Sections 475.25(1)(b) and (d), Florida Statutes, which authorize license disciplinary action against any licensee who:
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)
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 a 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.
Section 475.25(1)(d) further sets forth specific procedures which a licensee shall follow if doubts and conflicting demands exist concerning monies, funds and commissions which must be placed in an escrow account in accordance with Rules 21V-14.010, 21V-14.013, Florida Administrative Code:
... 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 employs 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.
The evidence does not establish that Respondents utilized the procedures required by Section 475.25(1)(d) for resolving doubts and conflicting demands between themselves and Givens. Therefore, Petitioner is not precluded from filing the Administrative Complaint in this case.
Petitioner has sustained its burden with regard to Respondent Perez by clearly and convincingly establishing that he failed to deliver to Beverly Givens commissions to which she was entitled of between $961.26 and $1,141.94. This caused her to bring suit against the real estate corporation for which she worked at the time and for which Respondent Perez was president and qualifying broker, Richard Perez and Associates, Inc. She subsequently received a Final Judgment against said corporation. Respondent Perez executed Givens' independent contractor and compensation agreements and signed checks to her on behalf of said corporation for draws and commissions. His actions constitute concealment and dishonesty concerning commissions clearly owed by him to Givens. Despite the mechanism for resolving legitimate commission disputes set forth in Section 475.25(1)(d), Respondent Perez chose to simply withhold payment of commissions claimed by Givens and it has been judicially determined by the Circuit Court for Pinellas County that Respondents were not legally entitled to withhold such commissions and were, in fact, liable to Givens for commissions. See Golub v. Department of Professional Regulation, 450 So.2d 229 (Fla. 5th DCA 1984).
These actions involving three real estate transactions each constitute separate violations of both Sections 475.25(1)(b) and (d), Florida Statutes. Section 475.25(1), Florida Statutes, authorizes the Florida Real Estate Commission to suspend or revoke a license, or impose an administrative fine of up to $1000.00 for each count or separate offense.
