Judges: ARNOLD H. POLLOCK
Agency: Department of Business and Professional Regulation
Latest Update: Feb. 12, 1988
Summary: Broker guilty of fraud/culpable negligence for forging seller's signature on contract and listing and not independently measuring room size.
87-2144STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
DEPARTMENT OF PROFESSIONAL ) REGULATION, DIVISION OF REAL ) ESTATE, FLORIDA REAL ESTATE )
COMMISSION )
)
Petitioner, )
)
vs. ) CASE NO. 87-2144
)
STEPHEN HAUTALA, ARLENE ) GUENNEL, and ALMAR REALTY, INC., )
)
Respondent. )
)
RECOMMENDED ORDER
Consistent with the Order Amending Hearing Date submitted to the parties by the undersigned on November 3, 1987, a hearing was held in this case before Arnold H. Pollock, a Hearing Officer with the Division of Administrative Hearings in Ft. Myers, Florida on December 10, 1987. The issue for consideration was whether the Respondents' licenses as registered real estate broker, salesman, and brokerage corporation respectively, in Florida should be disciplined because of the alleged misconduct outlined in the Administrative Complaint filed herein.
APPEARANCES
For Petitioner: Arthur R. Shell, Jr., Esquire
Division of Real Estate
400 West Robinson Street Orlando, Florida 32801
For Respondent: Neale Montgomery, Esquire
Post Office Drawer 1507 Ft. Myers, Florida 33902
BACKGROUND INFORMATION
By Administrative complaint dated April 22, 1987, Petitioner charged Respondents with 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. Thereafter, Respondents denied the allegations and requested a formal hearing. On May 14, 1987, the file was forwarded to the Division of Administrative Hearings for appointment of a hearing officer and on June 17, 1987, Hearing Officer Linda M. Rigot set the case for hearing for October 27, 1987. The undersigned, to whom the case had been transferred, on motion continued the matter until December 10, 1987, at which time it was held as scheduled.
At the hearing, Petitioner presented the testimony of Robert J. Tracey, owner of the property involved in the matter under consideration; Pamela Ciavarella, a realtor with Merrill, Lynch Realty in Ft. Myers; Carolyn A. Bauer, a broker with Merrill, Lynch; William C. Rhoad, purchaser of the Tracey property; Donna May Prosser, a licensed real estate broker; and John M. Adams, Executive Officer of the Cape Coral Board of Realtors. Petitioner also introduced Petitioner's Exhibits 1 through 5.
Respondent Hautala testified in his own behalf as did Respondent Arlene Guennel. Respondents also presented the testimony of Julia Fitzgerald, a neighbor and friend of Ms. Guennel; and Mr. Tracey, who had testified for the Petitioner. Respondents introduced Respondents' Exhibit A.
No transcript of the proceedings was furnished nor did either party submit proposed Findings of Fact.
FINDINGS OF FACT
At all times pertinent to the allegations contained herein, Respondent Stephen S. Hautala was licensed as a registered real estate broker in Florida; Almar Realty, Inc., was licensed as a real estate brokerage corporation in Florida; and Arlene J. Guennel was licensed as a real estate salesman in Florida.
At the time of the alleged misconduct, Robert J. Tracey owned and occupied a home located at 1123 SE 36th Terrace in Cape Coral, Florida, which he occupied as his private residence. He met Respondent, Arlene Guennel, at a construction site at which he was working and agreed to let her attempt to sell the house. He gave her a key so she could preview it and never received the key back.
After this meeting, Mr. Tracey did not contact Ms. Guennel, nor did he hear from her for quite a while. From time to time he would come home and find his bed had been made and he assumed that Ms. Guennel had done it. She had on several occasions straightened up the house so that it would be presentable to show.
Mr. Tracey did not execute a formal listing agreement with Ms. Guennel. One evening in early April, 1986, she came to the Tracey home with a sales contract bearing an offer of $115,000.00. Mr. Tracey did not accept that offer by signing his name to the contract which now bears his purported signature, "Bob" Tracey. The listing agreement purportedly entered into by Mr. Tracey with Ms. Guennel, who was representing Almar Realty, also bears the signature of the lister as "Bob" Tracey. Mr. Tracey strongly contends that he never signs his name that way and it is found that Mr. Tracey did not sign either document. Respondent, Guennel, admits to having signed Mr. Tracey's name to the sales contract and though she denies having signed the listing contract, it is found that she signed it, or procured someone else to sign it.
Mr. Tracey contends that he did not agree to the terms of the contract presented to him by Ms. Guennel. He did, however, initial certain counterproposals which are contained on the document and admits to having initialed it in the lower right hand corner.
Mr. Tracey denies having given Ms. Guennel any permission to sign documents or initial corrections to documents in his name, utilizing his signature or initials. However, it is found that on the evening that Respondent
Guennel came to Tracey's house with the contract containing the offer to purchase the property, he did propose a counter offer. He also indicated that in the event that Ms. Guennel could not get to him in person with a proposal, it would be all right for her to secure verbal approval by phone and thereafter make the appropriate changes in the contract. At no time, however, was Mr.
Guennel or Mr. Hautala authorized to commit Mr. Tracey to any change without at least his verbal approval and neither was authorized to affix his signature to any document.
William C. Rhoad was referred by his former broker to the local Merrill, Lynch office and Ms. Ciavarella, the local representative, showed him the Tracey home which was listed in the multiple listing book.
Mr. Rhoad had indicated his need for a large home in excess of 2200 square feet and chose the Tracey home after seeing several others on the basis of the square footage represented in the multiple listing book. Neither Mr. Rhoad nor his agent measured the property. He made an offer which was presented by his agent to Respondent Guennel at Ms. Guennel's home on or about April 7, 1986. Ms. Guennel called her back on or about April 9, 1986, to advise that the contract had been signed by the seller.
The seller's signature, however, was in conjunction with a counter offer of $119,500.00 as opposed to the $115,000.00 offered plus a split of 50/50 on the cost of the title insurance. Mr. Rhoad countered that counteroffer with another offer of $119,000.00 and Ms. Guennel, after talking with Mr. Tracey about it, advised that Tracey had accepted the contract at $119,000.00 without the need to pay 50 percent of the title insurance costs.
When the closing was held, Respondent Guennel was not present. As the parties were going over the closing statement, Mr. Tracey said he would not pay
$363.00 for title insurance. When he asked why he should pay, Ms. Ciavarella, who was also present, advised him that it had been provided for in handwriting on the contract which he had allegedly initialed. Mr. Tracey, immediately denied having initialed that change and denied signing the contract. It became apparent then that Respondent, Guennel had signed the contract and at that point, Mr. Tracey's broker, the Almar representative, agreed to pay the title insurance cost and have it come out of their portion of the commission. Mr.
Tracey had, however, initialed the title insurance change and was subsequently held responsible for it in court.
It also appeared that the room size, as described on the multiple listing placed by Ms. Guennel, as well as the lot size, the year the house was built, it's elevation above sea level, and several other particulars were incorrect. Notwithstanding the fact that Mr. Rhoad looked at the house four or five time prior to deciding to buy it and had some doubt as to the size, he said nothing about this until shortly before closing.
Because of the various discrepancies described above and Mr. Rhoad's feeling he was being cheated, Mr. Rhoad attempted to back out of the deal. He was contacted, however, by his own agent and asked if he would reconsider going through with the purchase if concessions were made. He agreed and the listing agent, Mr. Tracey, and his agent reduced their commissions by a total of
$3,500.00, all of which was passed on to Mr. Rhoad. This reduction in price was prorated $2,500 to Almar Realty, $500.00 to Mr. Tracey, and $500.00 to Merrill, Lynch Realty.
The errors which appeared in the multiple listing book were the result of the input accomplished by Ms. Guennel.
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.
In the Administrative Complaint, Petitioner has charged each of the Respondents with fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, and breach of trust in a business transaction, all in violation of Subsection 475.25(1)(b), Florida Statutes, which authorizes the Real Estate Commission to discipline licensees for misconduct such as is alleged here.
In any disciplinary action, the burden of proof is on the Petitioner. Under the provisions of the cited statute, if proven, the allegations could result in severe sanctions including revocation of the licenses of all Respondents and the Petitioner must satisfy its burden of proof by clear and convincing evidence. Turlington v. Ferris, 496 So.2d 177 (Fla. 1st DCA 1986).
The evidence clearly shows that Respondent, Guennel, committed several improper acts. One was affixing the signature of Mr. Tracey to the contract committing him to sell his property when she did not have the authority to do so. This constitutes fraud and misrepresentation. The same is true regarding her placing Tracey's signature to the listing contract or having someone else do it. Though she denies having done so, and though the signature is not the same as that which appears on the contract to which she does admit, the weight of the evidence indicates that she either signed it herself or procured someone else to do it without Tracey's authority. This, too, constitutes a violation of the statute.
Ms. Guennel's failure to measure the rooms and her reliance on the representations by the seller as to the square footage when inputting the listing, constitutes culpable negligence. As to the other items, such as the absence of a wet bar, lot size, year built, and elevation, these were either obvious or could easily be determined from the public records of the county. Her failure to check and insure that the representation made to the public was accurate is culpable negligence.
The misconduct demonstrated here is exactly that type of activity which the Statute was intended to prevent. Real estate professionals must be held to the highest standards of integrity and practice and Respondent Guennel's actions here fall far short of the standards to be expected of a real estate professional in this state. Her performance merits disciplinary action.
As to Respondent Hautala, at the time in question it appears he was neither the office manager nor the supervising broker, nor is there any evidence to show his participation in any misconduct. There is insufficient evidence to support action against him.
As for Almar Realty, the evidence indicates that Respondent Guennel is the actual owner of the agency and that Mr. Faugst, the then office manager and supervising broker was actively involved with Mrs. Guennel in this transaction, it would appear the agency is guilty of misrepresentation at least.
RECOMMENDATION
Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore:
RECOMMENDED that Respondent Arlene J. Guennel's license be suspended for one year and that she pay a fine of $500.00; that the license of Almar Realty, Inc. be suspended for one year; and that the charges against Respondent Stephen
S. Hautala be dismissed.
RECOMMENDED this 12th day of February, 1988, at Tallahassee, Florida.
ARNOLD H. POLLOCK, 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 12th day of February, 1988.
COPIES FURNISHED:
Arthur R. Shell, Jr., Esquire DPR, Division of Real Estate
400 West Robinson Street Orlando, Florida 32801
Neale Montgomery, Esquire Post Office Drawer 1507 Ft. Myers, Florida 33902
Darlene F. Keller
Acting Executive Director DPR, Division of Real Estate
400 West Robinson Street Orlando, Florida 32801
Docket for Case No: 87-002144
Orders for Case No: 87-002144
| Issue Date |
Document |
Summary |
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Jun. 21, 1988 |
Agency Final Order
|
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Feb. 12, 1988 |
Recommended Order
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Broker guilty of fraud/culpable negligence for forging seller's signature on contract and listing and not independently measuring room size.
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