STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BUSINESS TELEPHONE SYSTEMS ) OF TALLAHASSEE, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 88-3885

)

DEPARTMENT OF GENERAL )

SERVICES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on October 17, 1988, at Tallahassee, Florida, before Michael M. Parrish, a duly designated Hearing Officer of the Division of Administrative Hearings. Appearances at the hearing were as follows:

APPEARANCES

For Petitioner: W. Crit Smith, Esquire

Smith & Thompson, P.A.

1530 Metropolitan Boulevard

Tallahassee, Florida 32308

For Respondent: Sandra E. Allen, Esquire

Office of General Counsel Department of General Services

200 East Gaines Street Room 452, Larson Building

Tallahassee, Florida 32399-0955 INTRODUCTION AND ISSUES

The basic issue in this case is whether the Petitioner, Business Telephone Systems of Tallahassee, Inc. ("BTS"), meets the eligibility criteria for recertification as a Minority Business Enterprise. The sole area of dispute concerns whether Ms. Nancy L. Nuce has control over the management and daily operations of the Petitioner corporation, within the meaning of Section 288.703(2), Florida Statutes, as implemented by Rule 13-8.005(3), Florida Administrative Code.

At the hearing, both parties presented evidence in the form of testimony and exhibits. Following the hearing, a transcript was prepared and, thereafter, both parties filed proposed recommended orders containing proposed findings of fact. The parties' proposals have been carefully considered during the formulation of this recommended order. All proposed findings of fact are specifically addressed in the appendix to this recommended order.

FINDINGS OF FACT

Based on the evidence received at the hearing, I make the following findings of fact.

1. The Petitioner, Business Telephone Systems of Tallahassee, Inc., was incorporated as a Florida corporation in October of 1985, and was certified as a minority business enterprise ("MBE") by the Department of General Services through May 21, 1988. Pursuant to its bylaws, the business of the corporation is managed by, and its corporate powers are exercised by, a board of directors. Ms. Nancy L. Nuce is the solemember of the Board of Directors of the Petitioner corporation and all corporate officers serve at her pleasure.

   
   

2. Ms. Nancy L. Nuce, a female, owns 97.25% of the stock of the Petitioner corporation. She serves as Vice President, Secretary, and Treasurer of the Petitioner corporation. Her husband, Mr. William Nuce, has always been the President of the Petitioner corporation. According to the bylaws, the President is the chief executive officer of the corporation. Nevertheless, the President serves at the pleasure of the Board of Directors, and Ms. Nancy Nuce, as sole member of that board, has the discretion to remove the President at any time. Since January of 1988, both Mr. William Nuce and Ms. Nancy Nuce have been working full-time for the Petitioner corporation.

   
   

3. Ms. Nancy L. Nuce has the sole authority to hire and fire employees of the Petitioner corporation, and she has exercised that authority.

   
   

4. Ms. Nancy L. Nuce is well informed as to the financial structure of the Petitioner corporation. She is the person who is most familiar with the financial affairs of the corporation, and she appears to be well informed regarding the corporation's financial affairs. She controls the business checking account of the Petitioner corporation and signs the vast majority of the checks. Mr. William Nuce is authorized to sign on the checking account, but rarely does so. Mr. William Nuce usually signs checks only when deliveries are made to the office at times when Ms. Nancy L. Nuce is not available.

   
   

5. Mr. William Nuce does not get involved in the financial affairs of the Petitioner corporation. He performs the technical aspects of the business, including such matters as installations, moves, changes, additions, and maintenance of telephone systems. Although he uses technicians to do most of the physical labor, he checks to make sure that the work is done properly and he does the site surveys prior to commencement of the work. As described in detail below, Ms. Nancy L. Nuce has a good working knowledge of the corporation's business operations and she handles all aspects of the corporation's business operations other than actual installation.

   
   

6. Ms. Nancy Nuce develops and plans the necessary telephone systems with potential customers, determines the customers' needs, designs the systems, orders the necessary equipment for the telephone systems, and trains the customers on the systems once they are installed. She seeks and negotiates contracts, prepares and submits bid proposals, determines the amount of profit to include in the bid, negotiates and obtains the necessary bonding to submit bids, and determines which projects to bid on. She purchases all necessary insurance for the corporation. She orders and purchases all necessary inventory and insures that all supplies necessary for the day-to-day operation of the business are on hand. She negotiated the lease of the corporation's business premises and recently negotiated and purchased a truck for the corporation.

   CONCLUSIONS OF LAW

   
   

   Based on the foregoing findings of fact and on the applicable legal principles, I make the following conclusions of law.

   
   

7. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this case. Sec. 120.57(1), Fla. Stat.

   
   

8. In a case of this nature, the burden is on the applicant to demonstrate its entitlement to the certification it seeks. See Florida Department of Transportation vs. JWC Company, Inc., 396 So.2d 778 (Fla. 1st DCA 1981). In this case it has been stipulated that the Petitioner meets all criteria for certification except the criteria related to control of management and daily operations. The criteria related to control of management and daily operations are addressed as follows at Rule 13-8.005(3), Florida Administrative Code:

   
   

   1. An applicant must establish that the minority owners possess control over the management and daily operations of the business. The Department will consider the following factors:

      1. Whether the minority owners have control over the purchase of goods, equipment, business inventory and services needed in the day-to-day operation of the business.

      2. Whether the minority owners have the authority to hire and fire employees.

      3. Whether the minority owners have a knowledge of the financial structure of the business and control over all financial affairs.

         Whether the minority owners control business accounts, checking,

         savings, and other financial affairs.

         1. Whether the minority owners have the capability, knowledge, and experience required to make decisions regarding that particular type of work.

         2. Whether the minority owners have displayed independence and initiative in seeking and negotiating contracts, accepting and rejecting bids and in conducting all major aspects of the business

         
         

9. As noted in the recommended order in Barton S. Amey Company, Inc. vs. Department of General Services, DOAH Case No. 86-3954 (R.O. March 5, 1987; F.O. April 21, 1987):

   
   

   The factors included in Rule 13-

   8.005(3), Florida Administrative Code, can be grouped into three general categories.

   First, the minority person must have control over the purchase of goods, equipment, business inventory and services,

   control over all financial affairs and business accounts and authority to hire and fire. The term "control" has been defined as "to exercise authority over; direct; command." "Authority" has been defined as "the power or a right to command, act, enforce obedience, or make final decisions; jurisdiction." Webster's New Twentieth Century Dictionary, Unabridged 1980.

   
   

10. The evidence in this case establishes that the minority owner, Ms. Nancy L. Nuce, possesses and exercises the control and authority envisioned by the provisions of Rule 13-8.005(3) Florida Administrative Code. Therefore, the Petitioner corporation is entitled to the recertification it seeks.

RECOMMENDATION

Based on all of the foregoing, it is recommended that the Department of General Services issue a final order in this case recertifying the Petitioner corporation as a minority business enterprise.

DONE and ENTERED this 21st day of March, 1989, at Tallahassee, Florida.

MICHAEL M. PARRISH

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 21st day of March, 1989.

APPENDIX TO RECOMMENDED ORDER IN CASE NO. 88-3885

The following are my specific rulings on the proposed findings of fact submitted by all parties.

Findings proposed by Petitioner:

All findings of fact submitted by the Petitioner have been accepted, except as specifically noted below.

Paragraph 2: The first sentence is rejected a unnecessary historical and procedural details.

Findings proposed by Respondent:

Paragraph 1: First sentence accepted. The remainder of this paragraph is rejected as constituting unnecessary background details.

Paragraphs 2 and 3: Rejected as constituting subordinate and unnecessary details.

Paragraph 4: It is accepted that Ms. Nuce owns 97.25% of the stock of the Petitioner corporation. The rest of this paragraph is rejected as subordinate and unnecessary details.

Paragraphs 5 and 6: Rejected as subordinate and unnecessary details.

Paragraph 7: The first and fourth sentences of this paragraph are accepted. The remainder of the paragraph is rejected as subordinate and unnecessary details and as unnecessary commentary upon the quality of the evidence.

Paragraphs 8 and 9: Accepted in substance with some unnecessary details omitted.

Paragraph 10: Rejected as subordinate and unnecessary details.

Paragraph 11: For the most part, rejected as subordinate and unnecessary details. Last sentence of this paragraph has been accepted.

Paragraph 12: Rejected as subordinate and unnecessary details and as constituting an inference contrary to the greater weight of the evidence.

Paragraph 13: Last sentence accepted in substance. The remainder of this paragraph is rejected as subordinate and unnecessary details.

Paragraph 14: Rejected because the fact that discussions take place is irrelevant and joint decisions is contrary to the greater weight of the evidence.

Paragraph 15: Rejected as subordinate and unnecessary details. Third sentence also rejected as not fully supported by persuasive competent substantial evidence.

Paragraph 16: Accepted in substance, with many unnecessary details omitted.

Paragraphs 17, 18, and 19: Rejected as subordinate and unnecessary details.

Paragraph 20: Accepted in substance with unnecessary details omitted.

Paragraph 21: First sentence reflected as constituting a commentary on the quality of the evidence father than a proposed finding of fact. Second sentence rejected as unnecessary details.

Paragraphs 22, 23, 24, 25, 26, and 27: Rejected as subordinate and unnecessary details, some of which are not fully supported by the evidence.

COPIES FURNISHED:

W. Crit Smith, Esquire SMITH & THOMPSON, P.A.

1530 Metropolitan Boulevard

Tallahassee, Florida 32308

Sandra D. Allen, Esquire Office of General Counsel Department of General Services

200 East Gaines Street Room 452, Larson Building

Tallahassee, Florida 32399-0955

Ronald W. Thomas Executive Director

Department of General Services

200 East Gaines Street Room 133, Larson Building

Tallahassee, Florida 32399-0955

Susan Kirkland, Esquire

General Counsel Department of General Services

200 East Gaines Street Room 452, Larson Building

Tallahassee, Florida 32399-0955

Docket for Case No: 88-003885

Orders for Case No: 88-003885