STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) CASE NO. 87-3044

)

LARRY G. BANGERT, )

)

Respondent. )

)

RECOMMENDED ORDER

Final hearing in the above-styled action was held in Orlando, Florida on November 3, 1987, before Mary Clark, Hearing Officer of the Division of Administrative Hearings.

The parties were represented as follows:

For Petitioner: James R. Mitchell, Esquire

Department of Professional Regulation Division of Real Estate

400 West Robinson Street Tallahassee, Florida 32802

For Respondent: Larry G. Bangert, pro se

103 Cashew Court Longwood, Florida 32750

Background and Procedural Matters

An Administrative Complaint filed on April 7, 1987, alleged three counts of violations of Section 475.25(1)(b) FS. by J. Thomas Jafek, J. Thomas Jafek II and Larry G. Bangert. Bangert responded with a request for formal hearing and this proceeding resulted.

At the final hearing, the two Jafeks were not parties, but J. Thomas Jafek testified as a witness for Petitioner, DPR. The agency also presented the testimony of Cynthia Green Tyson, J. Scott Jones and Garrick Fox. Seven exhibits were received into evidence without objection. Bangert testified in his own behalf and introduced two exhibits, both of which were admitted over objections based on relevance.

A hearing transcript was not filed, and only DPR submitted a proposed recommended order. The attached appendix addresses each finding of fact proposed by DPR.

Issue

The matter for determination is whether, as alleged in the Administrative Complaint, Larry G. Bangert 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, by failing to disclose that he was a licensed real estate salesman and by depositing a note, rather than cash, as a binder in a contract for purchase of real estate.

FINDINGS OF FACT

1. At all times relevant, Bangert was a licensed real estate salesman with State of Florida license number 0312002.

   
   

2. On or about May 1, 1986, Cynthia Green (now Cynthia Tyson) listed her house at 408 Lakeview Drive, Altamonte Springs, Florida, under an exclusive right of sale contract with J. Scott Jones, a licensed real estate broker.

   
   

3. Through his broker, Help U. Sell (Thomas Jafek and Thomas Jafek II), Bangert offered $64,900.00 to Ms. Tyson for the Lakeview house. The contract for sale offered a $1,000.00 deposit note, with two mortgages, including a balloon mortgage, payment of $3,000.00 fix-up costs by the seller, and cash to the seller at closing in the amount of $15,659.00

   
   

   The offer was rejected by Ms. Tyson.

   
   

4. J. Scott Jones negotiated over the telephone with Thomas Jafek II, and then with Bangert. The basic requirement of Ms. Tyson was that she wanted

   $50,000.00 net at closing. She also wanted a cash deposit, as she had a previous negative experience with a deposit note.

   
   

   J. Scott Jones does not recall that he told Bangert that a cash deposit was required, but he knows the issue came up sometime during the telephone discussion. He did not speak to both Jafek and Bangert at the same time.

   
   

5. A second contract offer was signed by Bangert and was accepted by Ms. Tyson on August 30, 1986. The purchase price and method of payment was set out as follows:

   
   

   PURCHASE PRICE $ 68,500.00

   
   

   PAYMENT:

   1. Deposit(s) to be held in escrow by Help-U-Sell of College Park,

      upon acceptance in the amount of $ 1,000.00

   2. Subject to AND [sic] assumption of Mortgage in good standing in favor of To Be Obtained

      having an approximate present

      principal balance of $ 40,000.00

   3. Purchase money mortgage and note bearing interest at 9 percent on terms set forth herein below, in the principal amount of 360 payments

      of 189.10 to Balloon at 60th mo. $ 23,500.00

   4. Other Purchase Money Mortgage @ 10 percent in a single payment at

      60th mo. $ 5,000.00

   5. Balance to close (U.S. cash, LOCALLY DRAWN certified or cashier's check), subject to

      adjustments and prorations $ 68,500.00

      
      

      (Petitioner's Exhibit #4)

      
      

      The Contract also provided for the $50,000.00 net at closing to the seller.

      
      

6. Bangert gave Thomas Jafek a deposit note in the amount of $1,000.00. Jafek did not know how to put a note in a trust or escrow account, so he held it in his files at Help U. Sell.

   
   

   Jafek had dealt with Bangert before in real estate transactions and had acted before as the escrow agent. In those dealings Bangert only put down notes, never cash. Jafek understood that Bangert's role was as a principal buyer and that Bangert intended to assign the contract for sale.

   
   

7. The transaction was initially scheduled to close on September 26, 1987. On September 30, 1986, the parties agreed to extend the closing until October 10, 1986. When J. Scott Jones met with Bangert to get the extension signed, he learned that a note, rather than cash deposit had been made.

   
   

8. The transaction never closed. For reasons that are not material to this proceeding, Bangert did not appear at the closing.

   
   

9. Cynthia Tyson retained an attorney, Garrick N. Fox, who sent letters to Jafek and to Bangert on October 17, 1986.

   
   

   The letter to Jafek provides, in pertinent part:

   As per the contract for sale and purchase, your company holds one thousand dollars in escrow and we may [sic) hereby make demand that you remit to this law office the one thousand dollars held in escrow as partial damages for the default of the contract.

   (Petitioner's Exhibit #6)

   
   

   The letter to Bangert does not mention the deposit, but states that the contract is in default. The final paragraph states:

   
   

   It is my sincere desire that we can settle this matter amicably without the necessity of litigation. If you can close on this contract forthwith, all of these problems can be settled. If not I would appreciate it if you would have your attorney contact [sic] so that we can immediately take the proper steps to minimize Miss Green's damages.

   (Petitioner's Exhibit #7)

   
   

   The attorney never made an oral demand on Bangert for the $1000.00. Jafek did not consider his letter to be a present demand, but rather a statement of intent to make a demand in the future. Jafek did not tender the note and the

   $1000.00 was not paid.

   
   

10. Bangert had no intent to make a cash deposit. He claims that he told "Tom Jr." " (Thomas Jafek II) to type "a deposit note" on the second contract offer, but that even without that language, a note, rather than cash, was not precluded by the contract terms.

    
    

    Bangert intended that the transaction take place and did not have an intent or motive to defraud the seller. If the transaction had closed, he claims he would have honored the note. As far as he knows, Jafek still has the note.

    
    

11. Bangert claims also that it was an oversight that he did not reveal his real estate license status on the contract. The Jafeks knew he was a real estate salesman. Further, he and Scott Jones were teaching at the same real estate school and he felt that Jones should have known his status. He did not intend to hide the fact of his license from anyone. His business in the last three years has been actively serving as a principal buyer and seller for other parties.

    
    

12. Bangert's liability on his note is not at issue. In the absence of clear evidence of his knowledge of the seller's conditions, I cannot find that he is guilty of fraud in putting a note cash on deposit. Nor did he deliberately misrepresent a material fact to the seller by failing to disclose that he was a licensed real estate salesman. Ms. Tyson never met Bangert. Both parties were dealing at arms length through their own brokers.

    
    

    Conclusions of Law

    
    

13. The Division of Administrative Hearings has jurisdiction over this matter pursuant to Section 120.57(1) F.S. and Section 455.225(4) F.S.

    
    

14. Section 475.25(1) F.S. provides that the Florida Real Estate Commission may impose discipline if it finds that a licensee,

    
    

    (b) 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...

    
    

15. DPR has the burden of proving the allegations of this complaint through evidence that is clear and convincing. Ferris v. Turlington, 510 So.2nd 292 (Fla. 1987).

    
    

16. It is apparent now that Ms. Tyson wanted a cash deposit as one condition of accepting an offer to buy her property. It is not clear that the condition was communicated to Bangert by either his broker, Thomas Jafek, II, or by Ms. Tyson's broker, J. Scott Jones. Without this material evidence it cannot be established that Bangert deliberately engaged in a subterfuge.

    Without evidence of dishonest or illicit intent, there is no guilt under Section 475.25(1)(b), F.S. Morris v. Department of Professional Regulation 474 So.2nd 841 (Fla. 5th DCA 1985).

    
    

17. No rule nor provision of law has been cited to require a real estate licensee to reveal his status as such when engaging in the purchase and sale of property in his personal capacity. Nor was evidence produced that would establish and justify such a policy by the Board.

In Santaniello v. Department of Professional Regulation 432 So.2nd 84 (Fla.

2nd DCA 1983), the court upheld the Board's right to determine that a broker violated Section 475.25(1)(b) F.S. when he failed to reveal that a purchaser was his mother-in- law. In that case, the court observed that the broker owed his allegiance to the sellers and was obligated to inform them of anything which might influence their decision to sell. Because of that, the existence of the mother-in-law relationship was deemed a material fact. No such foundation for a duty to inform was established here, therefore there was no violation of section 475.25(1)(b) F.S.

RECOMMENDATION

Based on the foregoing, it is hereby, RECOMMENDED:

That the Administrative Complaint against Larry G. Bangert be dismissed.

DONE and RECOMMENDED this 17th day of December, 1987 in Tallahassee, Florida.

MARY CLARK

Hearing Office

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 17th day of December, 1987.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-3044

The following constitute specific rulings on the findings of fact proposed by Petitioner.

1. Adopted in paragraph #1.

2. Adopted in paragraph #2.

3. Adopted in substance in paragraphs #3 and #4.

4. Adopted in substance in paragraph #4. Evidence did not establish that Bangert was aware of the cash deposit condition by Ms. Tyson.

5. Rejected as contrary to the evidence. The face of the contract does not require cash.

6. Adopted in paragraph #7.

7. Adopted in paragraph #8.

8. Adopted in paragraph #6.

9. Adopted in substance in paragraph #7.

10. Adopted in paragraph #11.

11. Adopted in paragraph #7.

12. Adopted in part in paragraph #10. Bangert contended that the contract did not specify cash.

13. Rejected as cumulative.

14. Adopted in paragraph #9.

15. Rejected as immaterial.

COPIES FURNISHED:

Copies furnished:

DOAH Case No. 87-3044

James R. Mitchell, Esquire Department of Professional

Regulation Legal Division of Real Estate

400 West Robinson Street Tallahassee, Florida 32802

Larry G. Bangert

103 Cashew Court Longwood, Florida 32750

Harold Huff, Executive Director Florida Real Estate Commission

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

William O'Neil, Esquire General Counsel

Department of Professional Regulation

130 North Monroe Street Tallahassee, Florida 32399-0750

=================================================================

AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA

DEPARTMENT OF PROFESSIONAL REGULATION FLORIDA REAL ESTATE COMMISSION

DEPARTMENT OF PROFESSIONAL REGULATION, DIVISION OF REAL ESTATE

Petitioner,

vs. CASE NO. 0154916

DOAH NO. 87-3044

LARRY G. BANGERT

Respondent.

/

FINAL ORDER

The Florida Real Estate Commission heard this case on January 19, 1988 to issue a Final Order.

Hearing Officer Mary Clark of the Division of Administrative Hearings presided over a formal hearing on November 3, 1987. On December 17, 1987, she issued a Recommended Order, which is adopted by the Florida Real Estate Commission as to all Findings of Fact and Conclusions of Law, with the exception of Paragraph 10 of the Findings of Fact and Paragraph 4 of the Conclusions of Law, which are specifically rejected. A copy of this Recommended Order is attached hereto as Exhibit A and made a part hereof.

The Petitioner's Exceptions to the Recommended Order, attached hereto as Exhibit B, are hereby adopted by the Commission.

As to the Recommendation of the Hearing Officer, after a complete review of the record the Florida Real Estate Commission hereby ORDERS that the real estate license of the Respondent be revoked.

This Order shall be effective 30 days from date of filing with the Clerk of the Department of Professional Regulation. This Order shall be appealable to the District Court of Appeal within 30 days from filing date.

DONE AND ORDERED this 19th day of January 1988 in Orlando, Florida.

Darlene F. Keller, Director Division of Real Estate

I HEREBY CERTIFY that a true copy of the foregoing was sent by U.S. Mail to: Larry G. Bangert, 103 Cashew Court, Longwood, Fl 32750; to Hearing Officer Mary Clark, Division of Administrative Hearings, 2009 Apalachee Parkway, Tallahassee, Fl 32399-1550; and to Fred Wilsen, Esq, DPR, P O Box 1900, Orlando, Fl 32802, this 27th day of January 1988.

LG:pep

Darlene F. Keller

Docket for Case No: 87-003044

Orders for Case No: 87-003044