STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BERRY INVESTMENT GROUP, d/b/a ) THE BERRY RANCH, )

)

Petitioner, )

)

vs. ) CASE NO. 87-3282A

) FULL CIRCLE SERVICE, INC., and ) AETNA CASUALTY & SURETY COMPANY, )

)

Respondents. )

)

RECOMMENDED ORDER

For Petitioner: C. P. Hamilton

Venice, Florida

For Respondents: John Charles Heekin, Esquire

Port Charlotte, Florida

This case involves the Petitioner's complaint that Full Circle Service, Inc., and its surety, Aetna Casualty & Surety Company, owe the Petitioner

$4627.00 for deliveries of sod at two separate sites under two separate invoices. Through pleadings, the respondents do not dispute the complaint but raise the affirmative defense that sod paid for and delivered at yet a third site on the same open account was of unacceptable quality, requiring Full Circle to cover, and that the price paid for the unacceptable sod, the price paid for replacement sod and other incidental and consequential damages exceed the amount owed, establishing a complete defense of set-off.

The final hearing in this case was held in Englewood on November 19, 1987.

The parties requested and received until December 19 (or, since it is a Saturday, until December 21), 4; 1987, in which to file proposed recommended orders. Explicit rulings on the parties' proposed findings of fact may be found in the attached Appendix To Recommended Order, Case No. 87-3282A.

FINDINGS OF FACT

1. The Petitioner, Berry Investment Group, d/b/a The Berry Ranch, among other things, grows and sells sod.

   
   

2. Full Circle Service, Inc., is a landscaping business that was a customer of the Petitioner.

   
   

3. Aetna Casualty & Surety Company is the surety for Full Circle to secure the faithful accounting for and payment to producers such as the Petitioner for agricultural products purchased by Full Circle. 1/

4. During 1986, Full Circle did business with the Petitioner on a running account. Full Circle would order the delivery of sod for installation at different Full Circle jobs. The Petitioner would invoice each delivery separately.

   
   

5. During 1986, the Petitioner delivered $4073.40 worth of sod to Full Circle's San Marino Bay in Tampa and Barnett Bank job in Ft. Myers. (In addition, $854.60 for trucking fees and $246.40 of tax was invoiced on these deliveries.) This sod was of acceptable quality 2/ , yet Full Circle has not paid for this sod.

   
   

6. Also during 1986, the Petitioner delivered sod to Full Circle for installation at another job in Ft. Myers called Iona Lakes. Full Circle paid the Petitioner over $19,000 for this sod. When the sod was not acceptable to Full Circle's customer, Full Circle replaced much of the sod and claims this and other consequential and incidental damages relating to the Iona Lakes job should be set off against, and therefore completely extinguished, the Petitioner's San Marino Bay and Barnett Bank claims.

   
   

   CONCLUSIONS OF LAW

   
   

7. Section 604.21, Florida Statutes (1985), provides in pertinent part:

   
   

   1. Any person claiming himself to be damaged by any breach of the conditions of a bond or certificate of deposit assignment or agreement given by a licensed dealer in agricultural products as hereinbefore provided may enter complaint thereof against the dealer and against the surety, if any, to the department, which complaint shall be a written statement of the facts constituting the complaint ...

      
      

   2. Upon the filing of such complaint in the manner herein provided, the department shall investigate the matters complained of; whereupon, if, in the opinion of the department, the facts contained in the complaint warrant such action, the department shall send to the dealer in question, by certified mail, notice of the filing of the complaint. Such notice shall be accompanied by a true copy of the complaint. A copy of such notice and complaint shall also be sent to the surety company, if any, that provided the bond for the dealer, which surety company shall become party to the action. Such notice of the complaint shall inform the dealer of a reasonable time within which to answer the complaint by advising the department in writing that the allegations in the complaint are admitted or denied or that the complaint has been satisfied ...

   3. If the dealer admits the allegations of the complaint but fails to satisfy same within the time fixed by the department, the department shall thereupon order payment by the dealer of the amount found owed.

      
      

   4. ... If the department determines

      the complaint has not been established, the order shall, among other things, dismiss the proceedings. If the department determines that the allegations of the complaint have been established, it shall enter its findings of fact accordingly and thereupon enter its order adjudicating the amount of indebtedness due to be paid by the dealer to the complainant.

      
      

8. The threshold legal question raised by this case is whether the statute governing this proceeding provides for the trial of an affirmative defense, or counter-claim, of set-off. Neither the statute, the decisions under it nor the administrative orders under it clearly answer the question. But it is inferred from the language and purpose of the statute that defenses to a complaint under the statute must relate to the subject matter of the complaint, not to other business dealings not the subject of the complaint. See, e.g., Henderson v. Southern Cucumber Co., Inc., 478 So.2d 520 (Fla. 2d DCA 1985)(defense in the nature of statute of limitations and reply of fraudulent concealment related to the subject matter of the complaint); Blalock Foliage, Inc., v. Exotic Plant Sales, Inc., et al., 2 F.A.L.R. 1369-AS (Dpt. Agr. 1980)(defense of application of payments related to complaint of overall indebtedness to the plaintiff.) In light of this conclusion, the affirmative defense, or counter- claim, of set-off is legally insufficient in this proceeding and the factual issues it raises need not be resolved in this case. 3/

   
   

9. While attempting to raise the affirmative defense, or counter-claim, of set-off, Full Circle's answer admitted the allegations of the complaint (on the San Marino Bay and Barnett Bank jobs). Without the affirmative defense, or counter-claim, the complaint is established by the pleadings (together with the evidence) for purposes of this proceeding. Meanwhile, Aetna, the surety, did not answer, relying instead on Full Circle's defense. Therefore, all of the elements of the complaint, including the surety bond, have been established against both Full Circle and Aetna by the pleadings, together with the evidence.

RECOMMENDATION

Based on the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that the Department of Agriculture and Consumer Services enter a final order adjudicating that $4073.40 is the amount of the indebtedness owed to the plaintiff under its Amended Complaint and ordering Full Circle Service, Inc., to pay the indebtedness or, if it is not paid within 15 days after the final order is issued, ordering Aetna Casualty & Surety Company to pay it.

RECOMMENDED this 5th day of January, 1988 in Tallahassee, Florida.

J. LAWRENCE JOHNSON 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 5th day of January, 1987.

ENDNOTES

1/ The Amended Complaint in this case alleges that Aetna is Full Circle's surety. Aetna did not answer; Full Circle's answer does not dispute that Aetna is its surety. Therefore, this finding is made on the facts established by the parties' pleadings.

2/ There was unpersuasive testimony that the Barnett Bank sod was of unacceptable quality. On February 24, 1987, Full Circle acquiesced in a statement of its account as to the San Marino Bay and Barnett Bank jobs. There was no notice or indication before the final hearing that Full Circle considered the Barnett Bank sod to be unacceptable.

3/ On the other hand, the affirmative defense, or counter-claim, of set-off could be raised in circuit court proceedings between the parties.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-3282A

To comply with Section 120.59(2), Florida Statutes (1985) , the following explicit rulings are made on the parties' proposed findings of fact:

1. Petitioner's Proposed Findings Of Fact.

   
   

   1. Accepted and incorporated.

   2. Accepted and incorporated.

      
      

2. Respondents' Proposed Findings Of Fact.

   
   

   1-2. Accepted and incorporated except for conclusion of law. 3-4. Accepted and incorporated.

   
   

   1. Rejected as subordinate to facts contrary to those found.

   2. Second sentence, accepted and incorporated; first sentence, rejected as unnecessary in light of the conclusions of law.

   3. Accepted but subordinate and unnecessary.

   4. Rejected as unnecessary in light of the conclusions of law.

   5. Rejected as subordinate to facts contrary to those found.

   6. First and second sentences, accepted but subordinate; third sentence, rejected as unnecessary in light of the conclusions of law.

   7. Accepted but subordinate and unnecessary.

   
   

   COPIES FURNISHED:

   
   

3. P. Hamilton General Manager

The Berry Corporation Post Office Box 5609

Winter Haven, Florida 33880-0416

John Charles Heekin, Esquire 21202 Olean Blvd., Suite C2 Port Charlotte, Florida 33952

Honorable Doyle Conner Commissioner of Agriculture The Capitol

Tallahassee, Florida 32399-0810

Robert Chastain General Counsel

Department of Agriculture and Consumer Services

Mayo Building, Room 513 Tallahassee, Florida 32399-0800

Ben Pridgeon, Chief

Bureau of Licensing and Bond Department of Agriculture and Consumer Services

Lab Complex

Tallahassee, Florida 32399-1650

Docket for Case No: 87-003282

Orders for Case No: 87-003282