STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STATE OF FLORIDA, DEPARTMENT ) OF REVENUE, )

)

Petitioner, )

)

vs. ) CASE NO. 93-1563

)

JACK A. ROBINSON, )

)

Respondent. )

) STATE OF FLORIDA, DEPARTMENT ) OF REVENUE, )

)

Petitioner, )

)

vs. ) CASE NO. 93-1564

) I-10 CORPORATION, D/B/A STACKS ) AUTO TRUCK STOP, )

)

Respondent. )

) STATE OF FLORIDA, DEPARTMENT ) OF REVENUE, )

)

Petitioner, )

)

vs. ) CASE NO. 93-1565

)

R & R PARTNERSHIP, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, Don W. Davis, a duly designated Hearing Officer of the Division of Administrative Hearings, held a formal hearing in the above-styled case on March 26, 1993, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Lealand McCharen, Esquire

Assistant Attorney General Department of Legal Affairs The Capitol

Tallahassee, Florida 32399-1050

For Respondent: Timothy J. Warfel, Esquire

Post Office Box 1876 Tallahassee, Florida 32302-1876

STATEMENT OF THE ISSUES

The issues for determination are whether the emergency suspension of Respondents' licenses was proper and whether revocation of those licenses is required.

PRELIMINARY STATEMENT

On March 22, 1993, Petitioner served Emergency Orders Of Suspension on all Respondents, immediately suspending Respondent Robinson's wholesaler and special fuel dealer licenses, as well as the retailer licenses of the other two Respondents. Respondents were also served at that time with Notices To Show Cause why Respondents' licenses should not be permanently revoked.

Respondents timely requested immediate post

emergency suspension orders and the notices. The matter was transferred to the Division Of Administrative Hearings (DOAH) to conduct a formal hearing pursuant to Section 120.57(1), Florida Statutes.

At the hearing, Petitioner presented the testimony of one witnesses and two exhibits. Respondents presented one witness and 22 exhibits.

The transcript of the final hearing was filed on March 30, 1993. The parties requested and were granted leave to file posthearing submissions more than 10 days after the filing of the transcript, and in accordance with Rule 60Q-2.031, Florida Administrative Code, waived provisions of Rule 28-5.402, Florida Administrative Code. Proposed findings of fact submitted by the parties are addressed in the appendix to this recommended order.

FINDINGS OF FACT

1. Respondent Robinson, an authorized Chevron representative, is the sole proprietor of Jack A. Robinson, Distributor.

   
   

2. Respondent R&R Partnership (R&R) is a partnership between Jack A. Robinson and Dee Ann Rich (Rich).

   
   

3. Respondent I-10 Corporation (Stacks) is a subchapter S corporation in which Respondent Robinson is a 50 percent shareholder.

   
   

4. Rich is the general manager of Jack A. Robinson, Distributor and exercises administrative responsibilities with regard to Respondents Stacks and R & R Corporation.

   
   

5. Robinson holds Special Fuel Dealer's License No. 10

   Wholesaler's License No. 09000950/9356 issued by Petitioner. Robinson sells diesel fuel and gasoline at wholesale to I

   unrelated parties. I products at retail.

   
   

6. Robinson admits in response to Counts III, IV, VI, VII, VIII, IX, X, XI, XII, XVI, XIX, XXII, XXIII, XXIV, XXVII, and XXX, of the Notice To Show Cause in DOAH Case No. 93-1563 that $210,876.19 of tax remains due and owing.

7. Rich is Jack A. Robinson's step

   supervising and preparing tax returns for Robinson. With regard to the

   $210,876.19 admitted as due and owing, these state funds were collected by Respondent Jack A. Robinson as an agent for the State of Florida but, instead of being remitted to the state, these funds were spent by Respondent in the course of business operation.

   
   

   DOAH Case No. 93-1563

   
   

8. In response to Counts I, II, V, XV, XVII, XXI, XVI, XXVIII, and XXIX of the Notice To Show Cause in DOAH Case No. 93

   that $103,452.71 tax is due.

   
   

9. As to Count I, the balance for the tax return period of February 1990, for motor fuel tax due is $2,524.14.

   
   

10. In regard to Count II, Respondent also owes motor fuel tax in the amount of $26,839.71 for the tax return period of March, 1990. Although Rich requested Respondent's bank to make the appropriate electronic funds transfer to Petitioner, the amount was not received by Petitioner and no explanation was provided by Respondent for the failure of Petitioner to receive this amount.

    
    

11. As to Count V, Respondent owes a total motor fuel tax of $12,900.27. The previous total of $36,232.69 was reduced by a late partial payment of

    $11,562.53, and an additional payment of $11,769.87 on September 25, 1991.

    
    

12. No payment of tax was made for the period of March 1992.

    
    

13. As to Count XIV, Respondent Robinson filed a tax return for January 1993, motor fuel local option tax in the month of February 1993. The return showed a total tax due of $21,044.62. A collection allowance of $148.56 is shown deducted. No proof of payment of the tax was presented.

    
    

14. In regard to Count XVII, a return for the tax period of March 1990, was filed on behalf of Respondent Robinson, declaring a total special fuel tax due of $23,572.82. No evidence was presented that payment was actually made, although Rich testified that a wire transfer payment of that amount was requested by Respondent.

    
    

15. With regard to Respondent Robinson, the amounts of tax admitted in responsive pleading together with all counts of the Notice To Show Cause where no evidence or allegation of payment was presented total:

    Admitted in pleading $210,876.19 Admitted owing for March

    of 1990 in Motor Fuel and

    Special Fuel Tax $ 50,412.53

    
    

    Copies of Returns introduced and alleged to have been filed, but unsupported by Petitioner's

    records and otherwise unsubstan- tiated by proof (for August of

    1992 and January of 1993). $ 35,655.06

    No proof of payment presented for balance of November of
    1990 tax.	$ 12,900.27
    Admitted, paid less than due for January 1990; August 1990; and November, 1990.	$ 8,058.52

    
    

    This amount does not include applicable penalties and interest.

    
    

    DOAH Case No. 93-1565

    
    

16. Counts I through IV are admitted by Respondent R & R Partnership as to the amounts owned for a total tax due of $9,189.12. This amount does not include applicable penalties and accrued interest.

    
    

17. While R & R reported taxes due on Respondent Robinson's returns, no proof was submitted that these taxes were paid to Petitioner.

    
    

18. For the tax period of January, 1993, Rich maintained that a return was filed on behalf of R & R partnership and payment made. However, the copy of the payment check presented at hearing had "2/93" written in pencil as the date of the check and no evidence was presented that the check was presented for payment to Respondent's bank.

    
    

    DOAH CASE NO. 93-1564

    
    

19. With regard to I

    allegations of Counts I, II, III, IV, V, VII, VIII, X, XI, and XII. As to Counts VI and IX, Respondent denies only that there was improper reporting, not that the amount of tax is not due. Respondent maintains that all taxes collected by Stacks were paid to Respondent Robinson and reported on those returns.

    
    

20. The periods of January 1990; February 1990; March 1990; April 1990; August 1990; November 1990; February 1992; correspond to the counts of the Notice To Show Cause to which Stacks denies all allegations. These periods and denied counts match precisely with periods in Counts IX, X, XI, XII, XV, XVI, XVII, XVIII, XIX, XX, XXI, XXII, of the Notice To Show Cause filed against Respondent Robinson. Robinson admits Counts IX, X, XI, XII, XVI, XVII, XIX, XX, and XXII and presented no proof of payment at hearing with regard to Count XV and XVII. This fact, coupled with testimony that Stacks and R & R taxes were paid to Robinson and reported as line items on his returns, show that Stacks does owe the taxes claimed by Petitioner in the amount of $36,029.45 exclusive of interest and penalties.

    
    

21. Debra Swift, a Certified Public Accountant, employed by Petitioner, personally reviewed records of Petitioner in determining the amounts of tax, penalty and interest due from each Respondent. All payments received by Petitioner were credited by Swift in performing her calculations.

    
    

    CONCLUSIONS OF LAW

    
    

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

23. Respondent Robinson is a wholesaler licensed pursuant to Section 206.02, Florida Statutes. Wholesalers are required by provisions of Section 206.43, Florida Statutes, to report monthly all motor fuel taxes due and remit payment with the monthly return. Section 336.025 and Section 336.026, Florida Statutes, impose the same requirement with regard to motor fuel local option taxes. A wholesaler's license may be revoked by Petitioner for failure to remit these taxes to Petitioner in a timely fashion.

    
    

24. Special fuel dealers are also required to be licensed pursuant to Section 206.89, Florida Statutes. Robinson was such a licensed dealer. These special fuel dealers are also required to collect and remit special fuel tax and special fuel local option tax in a timely fashion. Section 206.87, Section 336.025, Section 336.026, and Section 206.91, Florida Statutes.

    
    

25. Failure to remit special fuel tax and special fuel local option tax when due in accordance with requirements of Section 206.97 and Section 206.055(1), Florida Statutes, permit the revocation of a special fuel dealer's license.

    
    

26. The magnitude of Respondent's dereliction with regard to collecting and remitting taxes is well

    Respondent's own admission, more than $200,000 in taxes was not remitted. The proof establishes that those taxes were collected and spent in the course of Respondent's business. Respondent Robinson's failure to collect and remit taxes in accordance with legal requirements resulted in harm to the State of Florida and is sufficient to justify revocation of Respondent's licenses.

    
    

27. Fuel retailers are also required to be licensed. Section 206.404, Florida Statutes. Respondent R & R and Respondent Stacks were licensed as fuel retailers. Both Respondents were required to collect and timely remit motor fuel local option taxes.

    
    

28. Respondent R & R admits that the tax claimed to be due is owed. Respondent argues that the tax was properly reported on the returns of Robinson because the businesses were "linked" as a result of Jack A. Robinson's ownership interest in all three businesses. This argument is not persuasive in view of the requirements of Rule 12B-5.007(5) that such combined reporting is permissible only if the fuel at the retail location is owned or co

    wholesaler. R & R and Stacks purchased fuel from Jack A. Robinson, obviating the applicability of "linking" of returns. R & R, as a separate legal entity is responsible for all taxes and filing of required returns in accordance with requirements of Rule 12B-5.007(5)(a), Florida Administrative Code.

    
    

29. Respondent Stacks denies all counts of the Notice To Show Cause. At hearing, no specific proof of payment of taxes was provided. Stacks' position is that Respondent Robinson was responsible for payment of taxes owed by Stacks. As noted with regard to R & R, the argument of "linked returns" is not persuasive and does not obviate Stacks' responsibility to pay its taxes.

    
    

30. Both R & R and Stacks have violated statutes requiring reporting and remitting of all taxes due. The State of Florida has suffered harm as a result of their dereliction of this statutory duty, thereby warranting revocation of the licenses of these Respondents.

RECOMMENDATION

Based on the foregoing, it is hereby

RECOMMENDED that a Final Order be entered revoking the fuel licenses of all three Respondents.

DONE AND ENTERED this 13th day of May, 1993, in Tallahassee, Leon County, Florida.

DON W. DAVIS

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 13th day of May, 1993.

APPENDIX

The following constitutes my rulings pursuant to Section 120.59, Florida Statutes, on proposed findings of fact submitted by the parties.

Petitioner's Proposed Findings:

1.-12. Adopted, though not verbatim. 13.-15. Accepted.

16.-22. Accepted.

Respondent's Proposed Findings:

1. Rejected, no record citation. 2.-3. Adopted.

4. Accepted, except for last sentence which is rejected as legal conclusion.

5.-7. Adopted.

8.-9. Rejected, subordinate to HO findings on this point. 10.-12. Rejected, weight of the evidence.

13. Rejected, relevancy.

14.-16. Rejected, subordinate to HO findings.

17. Adopted by reference.

18.-21. Rejected, subordinate to HO findings.

22.-24. Rejected, weight of the evidence, no citation. 25._38. Rejected, subordinate to HO findings.

39.-40. Rejected, weight of the evidence. 41.-42. Adopted by reference.

43.-44. Rejected, subordinate, misconstruction of testimony.

45. Rejected, conclusion of law, weight of the evidence. 46.-48. Rejected, subordinate, argumentative, relevancy.

COPIES FURNISHED:

Lealand L. McCharen Assistant Attorney General Department of Legal Affairs The Capitol-Tax Section Tallahassee, FL 32399-1050

Timothy J. Warfel Messer, Vickers Suite 701

First Florida Bank Building

215 South Monroe Street Post Office Box 1878 Tallahassee, FL 32302

Linda Lettera General Counsel

204 Carlton Building Tallahassee, FL 32399-0100

Larry Fuchs Executive Director

104 Carlton Building Tallahassee, FL 32399-0100

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.

Docket for Case No: 93-001563

Orders for Case No: 93-001563