STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF PROFESSIONAL ) REGULATION, DIVISION OF )

REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 89-5415

)

THOMAS CARTER, JR., )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on July 26, 1990, in Palatka, Florida, before the Division of Administrative Hearings, by its designated Hearing Officer, Diane K. Kiesling.

APPEARANCES

For Petitioner: Janine B. Myrick

Senior Attorney

Department of Professional Regulation

Division of Real Estate Post Office Box 1900 Orlando, Florida 32802

For Respondent: James A. Bazley

Attorney at Law

418 Kingsley Avenue Post Office Box 815

Orange Park, Florida 32067-0815 STATEMENT OF ISSUES

The issue is whether the real estate license of Respondent, Thomas Carter, Jr., should be revoked or otherwise penalized based on the acts alleged in the Administrative Complaint.

PRELIMINARY STATEMENT

The Department of Professional Regulation presented the testimony of Walter

1. Messer, Jr., Benny A. Carroll, and Sharri B. Hunter. DPR Exhibits 1-9 were admitted in evidence. Carter presented his own testimony and offered no exhibits.

   
   

   The filing of a transcript was waived by the parties. The parties further agreed that proposed findings of fact and conclusions of law were to be filed within 20 days of the hearing, no later than August 15, 1990. DPR timely filed

   its proposed findings of fact and conclusions of law on August 9, 1990. Carter failed to file a proposed recommended order. The proposed findings of fact and conclusions of law filed by DPR have been considered. A specific ruling on each proposed finding of fact is made in the Appendix attached hereto and made a part of this Recommended Order.

   
   

   FINDINGS OF FACT

   
   

   1. Thomas Carter, Jr., holds a real estate license in Florida, No. 0469236, and held this license at the times relevant to the charges in this case. His last license was as a broker at Palatka Realty, Inc., in Palatka, Florida.

      
      

   2. From sometime in October or November 1988, until January 31, 1989, Carter was affiliated with Palatka Realty, Inc.

      
      

   3. The financial arrangements between Carter and Palatka Realty are unclear. Walter C. Messer, Jr., president of and qualifying broker for Palatka Realty, testified that Carter was to pay one-half of the office overhead and keep all of the commissions he generated or pay no overhead and get one-half of the commissions he generated. However, Messer told a DPR investigator that Carter was to pay Palatka Realty $500 for rent, utilities and advertising, or

      $750 per month for total office expenses, and that the commissions were to be split in half between Palatka Realty and Carter. Carter testified that there was to be no sharing of commissions and that Carter and Messer were to share expenses with Messer presenting copies of office bills to Carter for payment. Carter said he was to pay $350 per month for office expenses. However, Carter told the DPR investigator that he was to pay $350 per month plus half of additional advertising expenses and that the commissions were to be split in half.

      
      

   4. It is clear that Messer and Carter had no written agreement and no clearly delineated verbal agreement regarding spliting of expenses and commissions. Both now remember the "terms" of their agreement in the manner which best benefits their respective positions. Neither's version is reliable or credible. Additionally, Carter never paid Messer anything for office expenses. Carter claims that he never paid because Messer demanded more money than they had agreed on and never showed him the bills to support the demands. Messer claims Carter never saw the bills because Carter failed to show up every time they had arranged to look at the bills.

      
      

   5. On January 26, 1989, Carter negotiated a sales contract between buyers Platt and seller Phillips.

      
      

   6. Carter received a $1000 earnest money deposit check from the Platts payable to Palatka Realty to secure the sales contract. The contract was signed by Carter and stated that the realtor was Palatka Realty, Inc., and that Palatka Realty represented the seller.

      
      

   7. On January 31, 1989, Carter submitted a resignation from Palatka Realty, Inc.

      
      

   8. Prior to the closing of the Platt-Phillips transaction, Messer gave Carter a $1000 Palatka Realty check, which represented the deposit, for presentation to the closing agent.

   9. At the time of the Platt-Phillips closing, Messer believed the commission should be remitted to Palatka Realty for distribution to Palatka Realty and Carter.

      
      

   10. On March 23, 1989, the Platt-Phillips transaction was closed by Sharri

       B. Hunter, closing agent for Lawyers Title Insurance Corporation.

       
       

   11. Ms. Hunter reviewed the settlement statement and determined that the sales commission should be paid to Palatka Realty.

       
       

   12. Carter, who attended the closing, instructed Ms. Hunter to make the sales commission check payable to him personally.

       
       

   13. Ms. Hunter told Carter that she would need a letter from Palatka Realty, Inc., authorizing disbursement of the commission to Carter personally.

       
       

   14. When Ms. Hunter requested an authorization letter, Carter told her he was "Palatka Realty."

       
       

   15. Ms. Hunter typed a statement dated March 23, 1989, which stated: "I, Thomas C. Carter, Jr., Vice president of Palatka Realty, Inc., authorize Lawyers Title Insurance Corporation to disburse the real estate commission check to Thomas C. Carter, Jr."

       
       

   16. Carter read and signed the statement as vice president of Palatka Realty, Inc.

       
       

   17. Ms. Hunter signed and notarized the statement. Based on this sworn statement, Ms. Hunter disbursed the entire sales commission of $4490 to Carter personally.

       
       

   18. On March 23, 1989, Carter was not employed by or affiliated in any way with Palatka Realty, Inc., having resigned on January 31, 1989.

       
       

   19. Subsequent to the closing of the Platt-Phillips transaction, Messer discovered the sales commission had been paid to Carter personally.

       
       

   20. On March 29 or 30, 1989, Messer sent a letter to Carter by certified United States Mail demanding the return of the Platt-Phillips commission and the document file relating to the transaction.

       
       

   21. On April 11, 1989, Messer sent a letter to F. Linton Stone of Lawyers Title Insurance Corporation advising that the Platt-Phillips commission was wrongfully paid to Carter and demanding that one-half of the commission be paid to Palatka Realty, Inc.

       
       

   22. Lawyers Title Insurance Corporation ultimately admitted liability for the commission and remitted one-half of the commission to Palatka Realty, Inc.

       
       

   23. Carter never paid one-half of the commission to Palatka Realty or Lawyers Title Insurance Corporation, and he never returned the document file to Palatka Realty.

       CONCLUSIONS OF LAW

       
       

   24. The Division of Administrative Hearings has jurisdiction of the parties to and subject matter of these proceedings. Section 120.57(1), Florida Statutes.

       
       

   25. By the Administrative Complaint, DPR charges Carter 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, and with having filed to account and deliver funds in violation of Section 475.25(1)(d), Florida Statutes. While DPR argues in its proposed recommended order that the violations alleged include the failure to deliver the document file on the transaction to Palatka Realty, no such allegations are made in the Administrative Complaint and no such charges will be considered in this case.

       
       

   26. The burden is on DPR to prove the allegations in the Administrative Complaint by clear and convincing evidence. DPR has carried its burden.

       
       

   27. Carter clearly engaged in trickery and misrepresentation in signing the sworn statement as vice president of Palatka Realty when he in fact was not affiliated with Palatka Realty and had not been so affiliated for almost two months. Carter made these misrepresentations solely to induce Ms. Hunter to disburse the sales commission to him personally. This constitutes a violation of Section 475.25(1)(b), Florida Statutes.

       
       

   28. Carter also failed to account for or deliver the funds from the Platt- Phillips transaction to Palatka Realty for appropriate distribution. While there may be some doubt as to entitlement to the final disbursement of the sales commission, there is no doubt that Palatka Realty was the realtor on the Platt- Phillips transaction and that the contract was entered into while Carter was the registered broker for Palatka Realty. The commission should have been paid to Palatka Realty. Carter and Messer could then have resolved their differences about entitlement to the commission in one of several ways. Instead, Carter fraudulently received the commission and failed to account for it or deliver it to Palatka Realty. This constitutes a violation of Section 475.25(1)(d), Florida Statutes.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Professional Regulation, Division of Real Estate, enter a Final Order and therein:

1. Find Thomas Carter, Jr., guilty of violating Sections 475.25(1)(b) and (d), Florida Statutes.

   
   

2. Impose an administrative fine of $500 per count for a total administrative fine of $1000.

   
   

3. Suspend Carter's real estate license for a period not to exceed one (1) year.

RECOMMENDED this 28th day of August, 1990, in Tallahassee, Florida.

DIANE K. KIESLING

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 28th day of August, 1990.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-5415

The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on the proposed findings of fact submitted in this case.

Specific Rulings on Proposed Findings of Fact

Submitted by Petitioner, Department of Professional Regulation,

Division of Real Estate

1. Each of the following proposed findings of fact is adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 2-4(1-3); 5-19(5-19); 21(3); 22(3); 23(4); 24(3); and 30-32(20-22).

   
   

2. Proposed findings of fact 1, 29, and 33 are unnecessary or irrelevant.

   
   

3. Proposed findings of fact 25-28 are subordinate to the facts actually found in this Recommended Order.

COPIES FURNISHED:

Janine B. Myrick Senior Attorney

Division of Real Estate

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

James A. Bazley Attorney at Law

418 Kingsley Avenue Post Office Box 815

Orange Park, Florida 32067-0815

Darlene F. Keller, Director Division of Real Estate

400 West Robinson Street Post Office Box 1900 Orlando, FL 32802

Kenneth E. Easley General Counsel

Department of Professional Regulation 1940 North Monroe Street

Tallahassee, FL 32399-0792

Docket for Case No: 89-005415

Orders for Case No: 89-005415