DEPARTMENT OF PROFESSIONAL ) REGULATION, CONSTRUCTION ) INDUSTRY LICENSING BOARD, )
vs. ) CASE NO. 87-5050
FRANK W. WALLACE, )
Respondent. )
The final hearing in this case was held on May 11, 1988 in Tampa, Florida, before Donald D. Conn, Hearing Officer, Division of Administrative Hearings.
The Department of Professional Regulation, Construction Industry Licensing Board (Petitioner) was represented by David Swanson, Esquire, but Frank W. Wallace (Respondent) was not present and was not represented at hearing.
The issue in this case is whether license disciplinary action should be taken by Petitioner against Respondent for contracting services he performed at the Sebring Square Plaza shopping mall in May, 1986. The Petitioner introduced fourteen exhibits, and called Kenneth R. Long, Franklin T. Caceres, Charles R. Baldwin and Bernard Verse to testify. No transcript of the hearing was filed. The Appendix to this Recommended Order contains a ruling on each proposed finding of fact that was filed.
The following findings of fact are based upon the evidence presented, Respondent's admissions and matters deemed admitted due to Respondent's failure to timely respond to Petitioner's Second Request for Admissions:
At all times material hereto, Respondent was licensed by the Construction Industry Licensing Board as a registered air conditioning contractor with license number RA-0035721. He was the qualifying agent for Wallace's Air Conditioning and Heating.
Respondent's address of record is 4710 Cypress Ridge Place, Tampa, Florida 33624, and it was to this address that notice of the hearing was sent. At no time prior to the hearing did Respondent contact counsel for Petitioner or the undersigned regarding any problem he had with the date scheduled for this hearing. Respondent did not appear, and was not represented at the hearing which commenced at 9:00 a.m. on May 11, 1988. However, at 1:56 p.m. on the day of hearing, a letter from Respondent addressed to Petitioner's counsel was filed at the Division of Administrative Hearings in Tallahassee, Florida. This letter was postmarked on May 9, 1988 and requests rescheduling of the hearing due to his being out of town on "urgent business." By Order entered on May 13, 1988, Respondent's untimely and insufficient motion for continuance was denied for
failure to comply with Rule 22I-6.017, Florida Administrative Code, and this case has proceeded to the issuance of this Recommended Order in accordance with the procedures established at hearing.
On or about March 18, 1986, Respondent, as qualifying agent for Wallace's Air Conditioning and Heating, entered into a contract with General Engineering and Machine Company for the installation of heating, ventilation and cooling services (HVAC) at the Sebring Square Plaza shopping mall in Sebring, Florida. The work to be performed included the installation of heating, ventilation, air conditioning and temperature control systems for stores in the mall, which included Zayre's Department Store and thirty "strip stores." The contract price for this work was $275,460.
Respondent thereafter began work on the mall under this contract. However, he has never held any certificate of competency, occupational license, or registration in the City of Sebring, as required by local ordinance sections 5-18 and 5-19.
On or about May, 1986 Respondent entered into a subcontract agreement with Long's Air Conditioning and Heating for sheetmetal duct work, venting of exhaust fans and installation of flex duct and grilles at the Sebring Square Plaza. The original amount of Respondent's contract with Long's Air Conditioning was $69,200, but this was increased by agreement to $72,200. On or about June 19, 1986, work on the thirty "strip stores" was deleted from this subcontract agreement, and the contract price was then reduced by $3,760, making a final contract price of $68,440.
Respondent received draw requests totaling $68,440 from Long's Air Conditioning for work performed under this subcontract. Although all contracted work was performed by Long's Air Conditioning, Respondent has only made payments totaling $66,500, leaving an unpaid amount of $1,940.
In connection with his work on the Sebring Square Plaza, Respondent purchased equipment and supplies from Florida Air Conditioners, Inc., in the total amount of $122,019.80, but made no payments on this account. On October 6, 1986, Respondent's account with Florida Air Conditioners was paid in full by Highway 27 Associates, the owners of the Sebring Square Plaza, who in turn charged this amount to the general contractor, General Engineering and Machine Company, by reducing the amount they paid to said general contractor on the Sebring Square Plaza.
Charles R. Baldwin was the general administrator on this shopping mall job for the general contractor, General Engineering and Machine Company. In accordance with his subcontract agreement with Respondent, if Respondent did not pay his materialmen, the general contractor was responsible, and, in fact, in this case the general contractor was charged for payments made by the mall owner on Respondent's account at Florida Air Conditioners.
Respondent failed to regularly attend weekly job site status meetings with Baldwin. When schedules were established, Respondent voiced no objection, but he then frequently failed to complete work in accordance with those schedules. Respondent made little effort to complete his work on time, or to make up for delays. He failed to supervise the work he was performing at the Sebring Square Plaza. On or about June 24, 1986 Respondent walked off the job without completing the work which he had contracted to perform, and this caused further delay in the mall's completion since Baldwin had to find another contractor to complete Respondent's job.
Baldwin paid Respondent $174,467.70 on June 18, 1986 in connection with this job after Respondent signed an affidavit certifying that he had paid all his materialmen and subcontractors. The record establishes that said affidavit was false. With the amount Baldwin was charged for Respondent's unpaid account with Florida Air Conditioners, and the amount paid on June 18, 1986, General Engineering and Machine Company paid or was charged approximately
$296,000 for work performed by Respondent, although their contract with Respondent was only $275,460.
According to Bernard Verse, who was accepted as an expert in commercial construction, Respondent's failure to pay for supplies and equipment, and his failure to complete his contract with General Engineering and Machine Company constitute misconduct in contracting. In addition, Respondent failed to properly supervise the work he was performing, and for which he contracted, on this job.
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. The Petitioner has the burden to prove, by clear and convincing evidence, the violations of Chapter 489, Florida Statutes, alleged in the Administrative Complaint issued against Respondent. Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).
Section 489.117(2), Florida Statutes, specifies that a registered contractor may only engage in contracting in cities and counties where that contractor has complied with all local licensing requirements. Since Respondent performed work on the Sebring Square Plaza without complying with ordinances of the City of Sebring concerning local certification of competency and registration, he is in violation of Section 489.117(2).
In pertinent part, Section 489.129(1), Florida Statutes, authorizes disciplinary action against any licensee who is found guilty of:
(j) Failure in any material respect to comply with the provisions of this act.
* * *
Signing a statement with respect to a project or contract falsely indicating that the work is bonded; falsely indicating that payment has been made for all subcontracted work, labor, and
materials which results in a financial loss to the owner, purchaser, or contractor; or falsely indicating that workers' compensation and public liability insurance are provided.
Upon proof that the licensee is guilty of fraud or deceit or of gross negligence, incompetency, or misconduct in the practice of contracting.
(Emphasis supplied.)
The evidence clearly and convincingly establishes that Respondent did not pay for all subcontract work performed for him, or supplies and materials be
received in connection with his work on the Sebring shopping mall. He falsely executed an affidavit to the contrary on June 18, 1986 in order to receive payment from the general contractor in the amount of $174,467.70. This payment, when added to the amount charged to the owner and general contractor for Respondent's account with Florida Air Conditioners, exceeded the amount due him under his subcontract agreement with General Engineering and Machine Company by approximately $21,000. These actions establish a violation of Section 489.129(1)(l), Florida Statutes.
In addition, expert testimony in the record, as well as a review of all testimony and exhibits, establishes that Respondent's performance under this subcontract constituted misconduct in contracting, in violation of Section 489.129(1)(m), Florida Statutes. He also failed to carry out his responsibilities as a "qualifying agent" under Section 489.105(4), Florida Statutes, by failing to properly supervise the work he performed at the Sebring mall, which lead to missed deadlines, delays, and ultimately to his failure to complete his contract responsibilities. Finally, the evidence in this case clearly shows that Respondent has failed in several material ways to comply with Chapter 489, Florida Statutes, and has therefore also violated Section 489.129(1)(j), Florida Statutes.
The Construction Industry Licensing Board has adopted Rule 21E-17.001, Florida Administrative Code, which sets forth guidelines for imposing license disciplinary action against licensees found to be in violation of Chapter 489, Florida Statutes. There is no evidence in the record of any prior violations by Respondent, and it is therefore presumed that these are his first violations of Chapter 489. Accordingly, for a first offense of Sections 489.117 and 489.129(1)(l) and (m), Florida Statutes, Rules 21E-17.001(2), (9)(a)(b), (19)(b) Florida Administrative Code, prescribe cumulative penalties of a letter of guidance, and a fine of between $1000 and $3000. Rule 21E-17.002 allows aggravation of said penalties if monetary damage or job-site misconduct has occurred. Circumstances concerning Respondent's violations in this case warrant aggravation of the penalty for these first offenses.
Based upon the foregoing, it is recommended that the Construction Industry Licensing Board enter a Final Order suspending Respondent's license number RA- 0035721 for one (1) year and imposing an administrative fine of $5,000; provided that after the expiration of thirty (30) days from the issuance of the Final Order if Respondent pays said administrative fine in full, his license shall be immediately reinstated.
DONE AND ENTERED this 23rd day of May, 1988, in Tallahassee, Florida.
DONALD D. CONN
Filed with the Clerk of the Division of Administrative Hearings this 23rd day of May, 1988.
APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-5050
8 Adopted in Findings of Fact 7, 8. 9-10 Adopted in Finding of Fact 6.
David L. Swanson, Esquire Department of Professional Regulation
Tallahassee, Florida 32399-0750 Frank W. Wallace 4710 Cypress Ridge Place
