STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HOMESAFE MORTGAGE COMPANY, )

)

Petitioner, )

)

vs. ) CASE NO. 92-4703

) DEPARTMENT OF BANKING AND FINANCE, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, William J. Kendrick, held a formal hearing in the above-styled case on November 30, 1992, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Marie A. Mattox

Attorney at Law 3045 Tower Court

Tallahassee, Florida 32303

For Respondent: Bridget L. Ryan

Assistant Attorney Counsel Department of Banking and Finance Suite 1302, The Capitol Tallahassee, Florida 32399

STATEMENT OF THE ISSUE

Whether petitioner's application for licensure as a mortgage lender pursuant to the "Saving Clause," Section 494.0065, Florida Statutes, should be approved.

PRELIMINARY STATEMENT

By letter of April 13, 1992, respondent, Department of Banking and Finance (Department), notified petitioner of its intention to deny its application for licensure as a mortgage lender pursuant to the "Saving Clause," Section 494.0065, Florida Statutes. In the notice, the Department gave the following explanation for its proposed action:

The denial is based on Sections 494.0065(1)(a)(1.), 494.0072(2)(P), Florida

Statutes, and Rule 3D-40.202, Florida Administrative Code. Section 494.0072(2), Florida Statutes, "Each of the following acts constitutes a ground for which the disciplinary actions specified in subsection (1) may be taken:

(p) Failure to comply with, or violations of, any other provision of ss. 494.001 - 494.0077."

Section 494.0065(1)(a), Florida Statutes, "Any person in good standing who holds an active registration pursuant to former s. 494.039 or license pursuant to former s. 521.205, or any person who acted solely as a mortgage servicer on September 30, 1991, is eligible to apply to the department for a mortgage lender's license and is eligible for licensure if the applicant:

1. For at least 12 months during the period of October 1, 1989, through September 30, 1991, has engaged in the business of either acting as a seller or assignor of mortgage loans or as a servicer of mortgage loans, or both; . . ."

Rule 3D-40.202, Florida Administrative Code, "Eligibility for Application for Mortgage Lender License Pursuant to the Saving Clause. A mortgage brokerage business licensee which changes their business entity, such as the incorporation of a sole proprietorship or partnership, shall be deemed the same "person" as defined in s. 494.001(17), F.S., for the purpose of determining eligibility pursuant to

s. 494.0065, F.S., provided the applicant is owned by the same person(s) holding the same ownership interest as the mortgage brokerage business licensee prior to any change in the resulting business entity." The applicant does not meet the eligibility requirements of Section 494.0065(1)(a)(1.), Florida Statutes, and Rule 3D-40.202, Florida Administrative Code.

On May 1, 1992, petitioner filed a timely request for a formal hearing on the Department's proposed denial of its application, and the matter was referred to the Division of Administrative Hearings for the assignment of a Hearing Officer to conduct a formal hearing pursuant to Section 120.57(1), Florida Statutes. Subsequently, respondent was granted leave to amend its notice of denial to include the following additional basis for its proposed action:

Section 494.0072(2)(k), Florida Statutes, "Acting as a mortgage lender or correspondent mortgage lender without a current, active license issued under ss. 494.006 - 494.0077."

Our records reflect Homesafe Mortgage Company

has acted as a mortgage lender without a current, active license.

At hearing, petitioner called Orlando J. Monteagudo and Henry Volpe as witnesses, and its exhibits 1-17 were received into evidence. Respondent called Rex Pearce as a witness, and its exhibits 1-15, 17A, 17B, and 17C were received into evidence. 1/ Respondent's request for official recognition of Chapter 494, Florida Statutes (1991), and Chapter 3D, Florida Administrative Code, was granted.

The transcript of hearing was filed December 14, 1992, and the parties were granted leave until January 7, 1993, later extended to January 11, 1993, to file proposed findings of fact. Consequently, the parties waived the requirement that a recommended order be rendered within thirty days after the transcript is filed. Rule 60Q-2.031(2), Florida Administrative Code. The parties' proposals have been addressed in the appendix to this recommended order.

FINDINGS OF FACT

Background

1. Petitioner, Homesafe Mortgage Company (Homesafe), initially known as FMC Mortgage Company, a Florida corporation, was established on May 24, 1990, and has, since its inception, been owned by Orlando Monteagudo and his wife, Omaida.

   
   

2. On September 16, 1990, Homesafe applied to respondent, Department of Banking and Finance (Department), for registration as a mortgage brokerage business under the provisions of Section 494.039, Florida Statutes (1989). Homesafe's application was approved, and its mortgage brokerage business license was issued on October 24, 1990.

   
   

3. A few days after Homesafe was licensed, the assets of another corporation wholly owned by Orlando and Omaida Monteagudo, First Miami Investments Corporation (FMIC), discussed more fully infra, were transferred to it, and Homesafe assumed the mortgage business of FMIC. At that time, FMIC became idle, and ceased doing business.

   
   

4. On October 1, 1991, a new law, the "Mortgage Brokerage and Mortgage Lending Act," Chapter 91-245, Laws of Florida, became effective, which substantially changed the provisions of Chapter 494, Florida Statutes, and required businesses desirous of engaging in activities as mortgage lenders to be licensed as such. The Act also required such licensure for entities engaged in the business of servicing loans, if they proposed to service loans for more than four months, whereas previously no license was required for such activity.

   
   

5. As a consequence of the amendments to chapter 494, Homesafe filed a timely application for licensure as a mortgage lender pursuant to the "Saving Clause," Section 494.0065, Florida Statutes. Pertinent to this case, that section provided:

   
   

   (1)(a) Any person in good standing who holds an active registration pursuant to former

   s. 494.039 . . . or any person who acted solely as a mortgage servicer on September 30, 1991, is eligible to apply to the department for a mortgage lender's license and is eligible for licensure if the applicant:

   
   

   1. For at least 12 months during the period of October 1, 1989, through September 30, 1991, has engaged in the business of either acting as a seller or assignor of mortgage loans or as a servicer of mortgage loans, or both . . . .

   (Emphasis added)

   And, Section 494.001(17), Florida Statutes, defined a "person" to mean "an individual, partnership, corporation, association, or other group, however organized."

   
   

6. Also pertinent to an evaluation of Homesafe's application by the Department was Rule 3D-40.202, Florida Administrative Code, which provided:

   
   

   Eligibility for Application for Mortgage Lender License Pursuant to the Saving Clause. A mortgage brokerage business licensee which changes their business entity, such as the incorporation of a sole proprietorship or

   partnership, shall be deemed the same "person" as defined s. 494.001(17), FS., for the purpose of determining eligibility pursuant to s. 494.0065, FS., provided the applicant is owned by the same person(s) holding the same ownership interest as the mortgage brokerage business licensee prior

   to any change in the resulting business entity.

   
   

7. By letter of April 13, 1992, the Department notified Homesafe of its intention to deny Homesafe's application for licensure as a mortgage lender pursuant to the "Saving Clause." The basis for the Department's denial was it conclusion that Homesafe had not "engaged in the business of either acting as a seller or assignor of mortgage loans or as a servicer of mortgage loans, or both" for "at least 12 months during the period of October 1, 1989, through September 30, 1991, as required by the "Saving Clause," and that the provisions of Rule 3D-40.202 were not applicable to Homesafe's circumstances, such that credit for FMIC's activities could be accorded Homesafe. Subsequently, the Department amended its notice of denial to include, as an additional basis for denial, its contention that Homesafe violated the provisions of Section 494.0072(2)(k), Florida Statutes, by acting as a mortgage lender subsequent to October 1, 1991, without a current, active license.

   
   

8. Homesafe filed a timely request for formal hearing and disputed the bases upon which the Department proposed to deny its application.

   
   

   Homesafe's activities and those of its predecessor in interest, FMIC

   
   

9. Orlando Monteagudo, the chief executive officer and co-owner of Homesafe, has personally held an active license as a mortgage broker since 1984, and has, through various entities, been active in the mortgage brokerage business since that date, without unfavorable incident.

   
   

10. On July 20, 1989, Orlando and Omaida Monteagudo became the sole owners of OJM Enterprises, Inc. (OJM), then known as The R & M Group, Inc., a Florida corporation, through a structured buy out from his former partners, with whom Monteagudo apparently felt strong dissatisfaction. OJM was the parent company of First Mortgage Corporation (FMMC) and First Miami Investment Corporation (FMIC), both Florida corporations. FMMC had been licensed as a mortgage brokerage business since at least March 14, 1986; however, neither OJM nor FMIC were ever so licensed. 2/

    
    

11. In September 1990, Monteagudo, out of a desire to further distance himself from his former associates, and on the advice of his accountant as to the best way to wrap up the affairs of OJM, FMMC and FMIC, contemplated the

    merger of OJM and FMMC into FMIC by September 30, 1990, and the transfer of their assets and mortgage brokerage business activities to Homesafe, which until that time had been largely inactive.

    
    

12. In furtherance of such plan, Homesafe, as heretofore noted, on September 16, 1990, applied to the Department for registration as a mortgage brokerage business under the provisions of Section 494.039, Florida Statutes (1989). Homesafe's brokerage business license was issued on October 24, 1990.

    
    

13. In the interim, a merger agreement was executed on September 29, 1990, on behalf of FMMC, FMIC and The R & M Group, Inc., whereby the parties agreed to merge The R & M Group, Inc., and FMMC into FMIC. [Use of the name "The R & M Group, Inc.," OJM's former name, was a mistake and would lead to a delay in filing with the Secretary of State as discussed infra.] Under the agreement, which was to have been effective September 30, 1990, FMIC would be the surviving entity, and "all the estate, property, rights, privileges, powers, franchises, and interests of each of the . . . corporations" would be vested in FMIC as the surviving corporation, without further act or deed.

    
    

14. Considering the restructuring that was occurring, the proof is persuasive that at least by October 1, 1990, and more probably at some unidentifiable date shortly prior thereto, Homesafe began to service mortgage loans on behalf of FMIC. Thereafter, by October 30, 1990, following approval of its application for a mortgage brokerage business license, Homesafe received the assets of FMIC and assumed the mortgage brokerage business that had previously been operated through the corporate group, now FMIC. At that time, FMIC became idle and ceased doing business.

    
    

15. Notwithstanding their efforts to effect a technical merger by September 30, 1990, the Secretary of State, by letter of January 4, 1991, rejected the merger agreement because The R & M Group, Inc., had changed its name on September 4, 1990, to OJM Enterprises, Inc. Accordingly, the parties were advised to correct their agreement to properly reflect the corporate parties if they desired the Secretary of State to accept such filing.

    
    

16. Consequently, on January 14, 1991, the parties executed an amended merger agreement that properly reflected the corporate parties as FMMC, FMIC and OJM Enterprises, Inc. That agreement was duly filed with the Secretary of State on January 18, 1991, and FMIC became, technically, the surviving corporation that date. Under the terms of that agreement, as with the initial agreement, Orlando and Omaida Monteagudo, as the sole owners of OJM, became the sole owners of FMIC.

    
    

    The Department's Rule 3D-40.202

    
    

17. Pertinent to this case, Rule 3D-40.202, Florida Administrative Code, provides:

    
    

    Eligibility for Application for Mortgage Lender License Pursuant to the Saving Clause. A mortgage brokerage business licensee which changes their business entity, such as the incorporation of a sole proprietorship or partnership, shall be deemed the same "person" as deemed in s. 494.001(17), FS., for the purpose of determining eligibility pursuant to

    s. 494.0065, FS., provided the applicant is owned

    by the same person(s) holding the same ownership interest as the mortgage brokerage business licensee prior to any change in the resulting business entity.

    
    

    Here, the Department and Homesafe disagree as to the proper interpretation of the foregoing provision.

    
    

18. The intent of the rule, according to the Department, was to permit those who were licensed as a mortgage brokerage business prior to the adoption of the "Mortgage Brokerage and Mortgage Lending Act," Chapter 91-245, Laws of Florida, but were not a corporate entity, to qualify under the "Saving Clause." Notably, under the amendments to chapter 494, only corporations are eligible for licensure as a mortgage lender. See Section 494.0061, Florida Statutes. Therefore, the Department interprets the rule to apply only when there has been an actual change in the form of the business entity, through incorporation of a sole proprietorship or partnership, and does not consider the rule applicable where, as here, a mere transfer of assets occurred between corporations.

    
    

19. Contrasted with the Department's interpretation, Homesafe contends that the provisions of the rule are broad enough to cover the situation where, as here, the mortgage brokerage business of one corporation is assumed by another corporation, as long as the ownership interests remain the same. Under such interpretation, Homesafe and FMIC, the surviving corporation, would be considered the same "person" for purposes of determining eligibility under the "Saving Clause," and Homesafe could be credited, if necessary, with the time periods FMIC or its merged parts operated as a mortgage brokerage business to satisfy the "12-month" standard of the "Saving Clause."

    
    

20. While Homesafe's interpretation may be a permissible interpretation of Rule 3D-40.202, so is the Department's. Indeed, the Department's interpretation of the rule is consistent with the intent of the rule and the doctrine of noscitur a sociis often applied as an aid to statutory construction. Under such circumstances, and for the reasons set forth in the conclusions of law, deference is accorded the agency's interpretation.

    
    

    Homesafe's activities subsequent to October 1, 1991

    
    

21. Pertinent to the Department's charge that Homesafe has acted as a mortgage lender subsequent to October 1, 1991, without a current, active license, the proof demonstrates that since October 1, 1991, Homesafe has made between 120-170 mortgage loans, sold those loans to investors, and thereafter serviced the majority of those loans.

    
    

22. In response, Monteagudo retorts that Homesafe was entitled to licensure under the "Saving Clause," and that it was entitled to and needed to continue its business pending Department approval of its application.

    
    

    CONCLUSIONS OF LAW

    
    

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

    
    

24. At issue in this proceeding is whether petitioner's application for licensure as a mortgage lender pursuant to the "Saving Clause," Section

    494.0065, Florida Statutes, should be approved. As the applicant, petitioner has the burden of demonstrating its entitlement to licensure. Florida Department of Transportation v. J.W.C. Co., Inc., 396 So.2d 778 (Fla. 1st DCA 1981), and Balino v. Department of Health and Rehabilitative Services, 348 So.2d

    349 (Fla. 1st DCA 1977).

    
    

25. Effective October 1, 1991, Chapter 494, Florida Statutes, prohibited any person from acting as a mortgage lender unless duly licensed. Section 494.0025, Florida Statutes. However, Section 494.0065, contained a "Savings Clause" which accorded certain persons who held an active mortgage brokerage business registration issued pursuant to former Section 494.039, Florida Statutes, or who acted solely as a mortgage servicer on September 30, 1991, to be eligible for licensure as a mortgage lender under the "Mortgage Brokerage and Mortgage Lending Act" (the "Act"), Chapter 91-245, Laws of Florida, provided they met the requirements they would otherwise have to meet to obtain such license.

    
    

26. Pertinent to this case, Section 494.0065, Florida Statutes, the "Saving Clause," provides:

    
    

    (1)(a) Any person in good standing who holds an active registration pursuant to former s. 494.039 . . . or any person who acted solely as a mortgage servicer on September 30, 1991, is eligible to apply to thee department for a mortgage lender's

    license and is eligible for licensure if the applicant:

    1. For at least 12 months during the period of October 1, 1989, through September 30, 1991, has engaged in the business of either acting as a seller or assignor of mortgage loans or as a servicer of mortgage loans, or both. . . .

       (Emphasis added)

       
       

       And, Section 494.001(17), Florida Statutes, defines a "person" to mean "an individual, partnership, corporation, association, or other group, however organized."

       
       

27. As heretofore noted in the findings of fact, Homesafe acted as a servicer of mortgage loans on behalf of FMIC by at least October 1, 1990, and following licensure, assumed the business of FMIC as a seller or assignor of mortgage loans. Under the circumstances, Homesafe has demonstrated that for "at least 12 months during the period of October 1, 1989, through September 30, 1991, [it] has engaged in the business of either acting as a seller or assignor of mortgage loans or as a servicer of mortgage loans, or both," and has demonstrated that it meets the eligibility requirements of the "Saving Clause."

    
    

28. As to the proper interpretation to be accorded Rule 3D-40.202, it is observed that the construction of a statute by an agency responsible for its administration is entitled to great deference and should not be overturned unless clearly erroneous. Department of Environmental Regulation v. Goldring,

    477 So.2d 532 (Fla. 1985), All Seasons Resorts, Inc. v. Division of Land Sales, Condominiums and Mobile Homes, 455 So.2d 544 (Fla. 1st DCA 1984), and Sans Souci

    v. Division of Lands Sales and Condominiums, 421 So.2d 623 (Fla. 1st DCA 1982). The same deference has been accorded to rules and to the meaning assigned to them by officials charged with their administration. Pan American World

    Airways, Inc. v. Florida Public Service Commission, 427 So.2d 716 (Fla. 1983), and State Department of Commerce, Division of Labor v. Matthews Corp., 358 So.2d

    256 (Fla. 1st DCA 1978). Moreover, the agency's interpretation does not have to be the only one or the most desirable one; it is enough if it is permissible. Pan American World Airways, Inc. v. Florida Public Service Commission, supra, and Florida Power Corp. v. Department of Environmental Regulation, 431 So.2d 684 (Fla. 1st DCA 1983). Here, the Department's interpretation of Rule 3D-40.202 is a permissible interpretation, and not clearly erroneous. Accordingly, deference is accorded its interpretation.

    
    

29. Finally, under the authority and reasoning set forth in the recommended order entered by Hearing Officer Stuart M. Lerner on November 18, 1992, in Alternative Mortgage Corporation v. Department of Banking and Finance, DOAH Case No. 92-4313, final order rendered December 31, 1992, the Department's contention that Homesafe's continued operation as a mortgage lender, pending approval of its application under the "Saving Clause," constituted a basis to deny its application is rejected. [A true copy of such recommended order and final order, as filed with the Division of Administrative Hearings, is included with the record and marked Hearing Officer exhibit 1.]

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be rendered approving Homesafe's application

for licensure as a mortgage lender pursuant to the "Saving Clause," Section 494.0065, Florida Statutes.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 28th day of April 1993.

WILLIAM J. KENDRICK

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 28th day of April 1993.

ENDNOTES

1/ At the conclusion of the hearing, the record remained open to allow respondent to have the continuation of the deposition of Orlando J. Monteagudo transcribed and filed as an exhibit. That deposition was filed January 7, 1993, marked respondent's exhibit 17C, and received into evidence.

2/ The corporate history of OJM Enterprises, Inc., FMMC and FMIC predates July 20, 1989, when Orlando and Omaida Monteagudo became sole owners. In this regard, the proof demonstrates that FMMC and FMIC were incorporated on September 26, 1983, and at that time were owned by Orlando and Omaida Monteagudo

(49 percent), Rene and Lourdes Rodriquez (49 percent), and Lourdes Garcia (2 percent). FMMC was probably first licensed by the Department at or about that time.

On or about July 30, 1984, The R & M Group, Inc., was formed and became the sole owner of FMMC and FMIC. Ownership of The R & M Group, Inc., continued, as it had with FMMC and FMIC, with Orlando and Omaida Monteagudo (49 percent), Rene and Lourdes Rodriquez (49 percent), and Lourdes Garcia (2 percent).

During July 1989, because of disagreements between the Monteagudo's and the Rodriquez's, the ownership of The R & M Group, Inc., changed. At that time, a new corporation called Century Mortgage was formed as a subsidiary of The R & M Group, Inc., which on July 20, 1989, was split off and became owned by the Rodriquez's. As of that date, the Monteagudo's became the sole owners of The R & M Group, Inc., with its two subsidiaries, FMMC and FMIC. On September 4, 1990, The R & M Group, Inc.'s, name was changed to OJM Enterprises, Inc.

APPENDIX

Homesafe's proposed findings of fact are addressed as follows: 1-8. Addressed in paragraphs 4-7.

9-15. Addressed in paragraphs 9-11, and endnote 2.

16 & 17. Addressed in paragraphs 11, 13, 15, and 16. 18-24. Addressed in paragraphs 1-3, and 11-16.

25. Rejected as subordinate or not a finding of fact.

26-30. Addressed in paragraph 9, otherwise rejected as subordinate or not relevant.

1. Addressed in paragraph 7, otherwise rejected as argument.

2. Rejected as not relevant since no such motion was made and because any application filed on behalf of FMMC would have been untimely under Section 494.0065(1)(a)3, Florida Statutes.

3. Addressed in paragraphs 21 and 22.

The Department's proposed findings of fact are addressed as follows: 1-5. Addressed in endnote 2.

6. Rejected as contrary to the proof. See paragraphs 13, 15, and 16.

7 & 8. Addressed in paragraph 10 and endnote 2.

9. Accepted but not necessary to result reached.

10 & 11. Addressed in paragraph 1.

1. Addressed in paragraph 14, otherwise contrary to the more persuasive proof.

2. Addressed in paragraph 2.

3. Addressed in paragraphs 5 and 7.

4. Addressed in paragraphs 13, 15 and 16.

5. Addressed in paragraph 4. 17-19. Addressed in paragraph 21.

20. Addressed in paragraph 18.

21 & 22. Addressed in paragraphs 11-14, otherwise rejected as argument or comment on the proof.

1. Rejected as subordinate or argumentative.

2. Rejected as not relevant.

COPIES FURNISHED:

Marie A. Mattox Attorney-at-Law 3045 Tower Court

Tallahassee, Florida 32303

Bridget L. Ryan

Assistant Attorney Counsel Department of Banking and Finance Suite 1302, The Capitol Tallahassee, Florida 32399

The Honorable Gerald Lewis Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350

William G. Reeves General Counsel

Department of Banking and Finance Room 1302, The Capitol Tallahassee, Florida 32399-0350

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this recommended order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this recommended order. Any exceptions to this recommended order should be filed with the agency that will issue the final order in this case.

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

AGENCY FINAL ORDER

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

STATE OF FLORIDA DEPARTMENT OF BANKING AND FINANCE

DIVISION OF FINANCE

HOMESAFE MORTGAGE COMPANY,

Petitioner,

vs. Administrative Proceeding

No. 2434-F-4/92

DEPARTMENT OF BANKING DOAH CASE NO. 92-4703 AND FINANCE,

Respondent.

/

FINAL ORDER

This matter has come before the undersigned as head of the Department of Banking and Finance, Division of Finance ("Department"), for the entry of a final order in the above styled proceeding. On April 28, 1993, a Hearing Officer from the Division of Administrative Hearings submitted his Recommended Order, a copy of which is attached hereto as Exhibit A. On April 13, 1993, the Department timely filed its exceptions to the Recommended Order, a copy of which is attached hereto as Exhibit B. No response was filed to the Department's exceptions.

BACKGROUND

Petitioner, Homesafe Mortgage Company, timely applied for licensure as a mortgage lender pursuant to the "Savings Clause," Section 494.0065, Florida Statutes. By letter dated April 13, 1992, the Department notified Homesafe of its intent to deny Homesafe's application and Homesafe requested a formal hearing. This matter was then transferred to the Division of Administrative Hearings for the assignment of a Hearing Officer to conduct a formal hearing pursuant to Section 120.57(1), Florida Statutes. A hearing was held in this matter on November 30, 1992, in Tallahassee, Florida. The Hearing Officer's Recommended Order recommends that the Department approve Homesafe's application pursuant to the Savings Clause.

RULINGS ON EXCEPTIONS FILED BY THE DEPARTMENT

First Exception: The Department's first exception is to the applicability of the provisions of Rule 3D-40.202, Florida Administrative Code. The Department contends that Rule 3D-40.202, Florida Administrative Code, does not apply to the facts of this proceeding.

The Department's first exception is granted. Although it is unclear from the Recommended Order whether the Hearing Officer ever determined that the Rule applied to Homesafe's situation, to the extent that it does, the Department

rejects that finding of fact and conclusion of law as not based on competent, substantial evidence and as an incorrect interpretation of the Department's rule.

Second Exception: The Department's second exception is to Paragraph 14 of the Recommended Order in which the Hearing Officer found that Homesafe had begun to service mortgage loans on behalf of First Miami Investment Corporation by at least October 1, 1990, and more probably at some unidentifiable date shortly prior thereto. The Department contends that Mr. Monteagudo's testimony was not credible and that Homesafe did not produce any documents at the hearing to establish that it was servicing mortgage loans prior to its licensure as a mortgage brokerage business.

In Heifetz v. Department of Business Regulation, 475 So.2d 1277 (Fla. 1st DCA 1985), the district court of appeal stated the respective roles of hearing officer and state agencies in deciding factual issues as follows:

Factual issues susceptible of ordinary methods of proof that are not infused with policy considerations are the prerogative of the hearing officer as the finder of fact.

McDonald v. Department of Banking and Finance, 346 So.2d 569 (Fla. 1st DCA 1977). It is the hearing officer's function to consider all the evidence presented, resolve conflicts, judge credibility of witnesses, draw permissible inferences from the evidence, and reach ultimate findings of fact based on competent, substantial evidence.

State Beverage Department v. Ernal, Inc., 115 So.2d 566 (Fla. 3rd DCA 1959). If, as is often the case, the evidence presented supports two inconsistent findings, it is the hearing officer's role to decide the issue one way or the other. The agency may not reject the hearing officer's finding unless there is no competent, substantial evidence from which the finding could reasonably be inferred. The agency is not authorized to weigh the evidence presented, judge credibility of witnesses, or otherwise interpret the evidence to fit its desired ultimate conclusion...

Id. at 1281.

Having reviewed the transcript, the evidence and the record of this proceeding, the Department's exception appears to have some merit in that there exists discrepancy and inconsistency in the record as to what date Homesafe commenced its operations in servicing mortgage loans. 1/ The Hearing Officer's finding seems to be based, in part, on Mr. Monteagudo's testimony at hearing that "[o]n or about July 6th Homesafe started servicing mortgages, some of the mortgages of First Miami Investment Corporation, exclusively." (Transcript page 31). 2/ However, based on Heifetz, supra, it cannot be determined that there is no competent, substantial evidence to support the Hearing Officer's finding.

Accordingly, the Department's second exception is rejected.

Having ruled on the exceptions filed in this matter and upon review and consideration of the Recommended Order, and the complete record of this proceeding, it is accordingly ORDERED:

1. The Hearing Officer's findings of fact and conclusions of law contained in the Recommended Order are hereby adopted and incorporated herein except as modified or rejected in this Final Order.

   
   

2. Homesafe's application for licensure as a mortgage lender pursuant to the "Savings Clause," Section 494.0065, Florida Statutes, is GRANTED.

DONE and ORDERED this 26th day of May, 1993, in Tallahassee, Leon County, Florida.

Gerald Lewis, as Comptroller and Head of the Department of Banking

and Finance

ENDNOTES

1/ The financial statements which were submitted with the application specifically stated that "[t]he company was incorporated in the State of Florida on July 6, 1990, to provide mortgage brokerage services in the South Florida Area. The Company remained inactive until commencement of operations on October 1, 1990."

2/ This testimony by Mr. Monteagudo at hearing directly conflicts with his deposition testimony taken on November 4, 1992, in which he testified that he had no knowledge of whether Homesafe serviced mortgage loans during the period of October 1, 1989 through September 30, 1991. (See Respondent's Exhibit 17-A,

page 76).

COPIES FURNISHED:

Randall A. Holland, Director Division of Finance

Bridget L. Ryan

Assistant General Counsel

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true copy of the forgoing Final Order has been sent by regular U.S. Mail to Marie A. Mattox, Esquire, 3045 Tower Court, Tallahassee, Florida 32303, and to Clerk, Division of Administrative Hearings, The DeSoto Building, 1230 Apalachee Parkway, Tallahassee, Florida 32399-1550, this 26th day of May, 1993.

Margaret S. Karniewicz

Department of Banking and Finance Suite 1302, The Capitol Tallahassee, Florida 32399-0350

(904) 488-9896

NOTICE OF RIGHT TO JUDICIAL REVIEW

ANY PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK, DEPARTMENT OF BANKING AND FINANCE, SUITE 1302, THE CAPITOL, TALLAHASSEE, FLORIDA 32399-0350, AND A SECOND COPY, ACCOMPANIED BY THE FILING FEES PRESCRIBED BY SECTION 35.22(3), FLORIDA STATUTES, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, 300 MARTIN L. KING, JR., BOULEVARD, TALLAHASSEE, FLORIDA 32399-1850, OR IN THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE PARTY RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN THIRTY (30) DAYS OF RENDITION OF THE FINAL ORDER TO BE REVIEWED.

Docket for Case No: 92-004703

Orders for Case No: 92-004703