STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA DEPARTMENT OF BUSINESS ) AND PROFESSIONAL REGULATION, ) DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 93-5575

)

SHERIN V. REYNOLDS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on December 15, 1993, in West Palm Beach, Florida, before Stuart M. Lerner, a duly designated Hearing Officer of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: James H. Gillis, Esquire

Senior Attorney

Department of Business and Professional Regulation,

Division of Real Estate Legal Section, Suite N 308

Hurston Building, North Tower

400 West Robinson Street Orlando, Florida 32801-1772

For Respondent: Jay J. Reynolds, Esquire

Reynolds and Reynolds, Chartered

433 Plaza Real, Suite 271 Boca Raton, Florida 33432

STATEMENT OF THE ISSUES

1. Whether Respondent committed the violations alleged in the Administrative Complaint?

   
   

2. If so, what disciplinary action should be taken against him?

PRELIMINARY STATEMENT

On August 19, 1993, the Department of Business and Professional Regulation (hereinafter referred to as the "Department") issued a one-count Administrative Complaint against Respondent, a licensed real estate salesperson, alleging that "Respondent is guilty of having had another state agency [namely, the Department of Banking and Finance] suspend [his] license or registration . . . , or impose a penalty against [him] as set forth in Subsection 475.455(2), Florida Statutes,

and therefore [he is] in violation of Subsection 475.25(1)(e), Florida Statutes." Respondent denied the allegations of wrongdoing advanced in the Administrative Complaint and requested a formal hearing. On September 30, 1993, the Department referred the matter to the Division of Administrative Hearings (hereinafter referred to as the "Division") for the assignment of a Division hearing officer to conduct the formal hearing Respondent had requested.

At the hearing that was held in the instant case, the Department called Respondent to the stand and elicited testimony from him. It also offered seven exhibits into evidence. Two of the exhibits, Petitioner's Exhibits 1 and 2, were received into evidence. The Hearing Officer reserved ruling on the remaining exhibits, Petitioner's Exhibits 3 through 7, all of which were represented to be records of the Florida Department of Banking and Finance (hereinafter referred to as "DBF") relating to DBF Proceeding No. 1307-F-1-1/89, until the parties had had the opportunity to address the issue of the admissibility of these documents in their post-hearing submittals. The Hearing Officer also gave the Department 20 days from the close of the hearing within which to file with the Division certified copies of the documents comprising Petitioner's Exhibits 3 through 7. He further indicated that if Respondent desired to challenge the authenticity of these certified copies he had to do so by filing a written objection with the Division within 15 days of being served with the certified copies.

Aside from Respondent's testimony and the seven exhibits offered by the Department, no other evidence was presented by either party. At the conclusion of the evidentiary portion of the hearing, the Hearing Officer, on the record, advised that the parties had the right to file post-hearing submittals and established a deadline, March 15, 1994, for the filing of such submittals with the Division.

On December 21, 1993, certified copies of Petitioner's Exhibits 3 through 7 were filed with the Division. To date, Respondent has not filed any written objection with the Division challenging the authenticity of these documents.

Having carefully considered the post-hearing submitals that were filed by the Department and Respondent on January 6, 1994, and January 31, 1994, respectively, as well as the arguments advanced by the parties at hearing, the Hearing Officer finds that Petitioner's Exhibits 3 through 7 are admissible to prove the allegations set forth in the instant Administrative Complaint regarding what occurred in DBF Proceeding No. 1307-F-1-1/89. Therefore, these exhibits will be received into evidence over Respondent's objection.

Both the Department's and Respondent's post-hearing submittals contain, what are labelled as, "findings of facts." These "findings of facts" proposed by the parties have been carefully considered and are specifically addressed in the Appendix to this Recommended Order.

FINDINGS OF FACT

Based upon the evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made:

1. The Department is a state government licensing and regulatory agency.

   
   

2. Respondent is now, and has been at all times material to the instant case, a licensed real estate salesperson in the State of Florida.

   
   

3. He holds license number 0497295.

4. The license is "involuntary inactive."

   
   

5. Respondent has also held a State of Florida mortgage broker's license issued by DBF. The license had an expiration date of August 31, 1991.

   
   

6. On or about May 31, 1989, DBF issued an administrative complaint in DBF Proceeding No. 1307-F-1-1/89 alleging that Respondent and others violated various provisions of the Florida's Mortgage Brokers Act.

   
   

7. Not having received a request for hearing from Respondent, DBF, on January 11, 1990, prior to the expiration date of Respondent's mortgage broker's license, issued a default order finding Respondent guilty of the violations alleged in the administrative complaint and permanently revoking his license,

   as well as ordering him to "tender the payment of an administrative fine in the amount of fifteen thousand dollars ($15,000.00) and a payment of three thousand ($3,000.00) for cost of investigation and prosecution."

   
   

8. On or about January 23, 1990, Respondent, through counsel, filed a Motion to Set Aside the default order. In the motion, Respondent asserted that he had "failed to request a hearing [on the administrative complaint] simply because he was not aware of same." He further contended in his Motion to Set Aside that the allegations of wrongdoing advanced in the administrative complaint were "totally erroneous."

   
   

9. On or about January 26, 1990, before DBF had ruled upon the Motion to Set Aside, Respondent, again through counsel, appealed the default order to the district court of appeal.

   
   

10. On or about October 31, 1991, Respondent and DBF entered into a Stipulation and Consent Agreement which provided, in pertinent part, as follows:

    
    

    1. In the interest of compromise and settlement, the Department and Reynolds agree to resolve the appeal of the Default Final Order on the following terms and conditions:

       1. Reynolds agrees to withdraw his appeal of the Default Final Order and his execution of this Stipulation and Consent Agreement shall constitute a withdrawal of the notice of appeal.

       2. Reynolds neither admits nor denies the truth of the allegations in the Complaint and Default Final Order. Reynolds agrees not to reapply for a mortgage broker license under the provisions of Chapter 494, Florida Statutes, for a period of three (3) years retroactive to January 11, 1990. Reynolds further agrees to cease and desist from any and all future violations of Chapter 494, Florida Statutes, and the rules promulgated thereunder.

       3. This Stipulation and Consent Agreement and accompanying Final Order supersede the "Default Final Order Revoking Mortgage Broker

          License and Registration" issued by the Department against Reynolds on January 11, 1990.

       4. The Department agrees to reduce the administrative fine imposed by the Default Final Order to One Thousand Dollars ($1,000.00). Reynolds agrees to pay an administrative fine of One Thousand Dollars ($1,000.00) by cashier's check or money order payable to "Gerald Lewis, Comptroller, Department of Banking and Finance, Division of Finance," immediately upon execution of the Stipulation and Consent Agreement.

    2. This Stipulation and Consent Agreement is being executed solely for the purpose of resolving and settling Reynolds' appeal of

       the Default Final Order. . . .

       8. Reynolds agrees that the accompanying Final Order, which will incorporate this Stipulation shall constitute final agency action by the Department, for which the Department may seek enforcement pursuant to Chapters 120 and 494, Florida Statutes. Reynolds further voluntarily and knowingly waives: (a) any right to an administrative hearing or issuance of a recommended order as provided by Chapter 120, Florida Statutes, and by Chapters 3-7, 28, or 22, Florida Administrative Code; (b) any right to separately stated findings of fact and conclusions of law; (c) any rights to contest in any judicial or administrative forum the validity of any term, condition, obligation, or duty created by this Stipulation or Final Order; and (d) any rights to object to or to challenge in any judicial proceeding, including, but not limited to, an appeal pursuant to Section 120.68, Florida Statutes, any aspect, provision, or requirement of the Stipulation or Final Order, based upon its content, procedure of issuance, or timeliness. . . .

       
       

11. Respondent entered into the Stipulation and Consent Agreement and agreed "to pay an administrative fine of One Thousand Dollars ($1,000.00)" and "not to reapply for a mortgage broker license under the provisions of Chapter 494, Florida Statutes, for a period of three (3) years retroactive to January 11, 1990," not because he was guilty of any wrongdoing, but simply as a matter of convenience to avoid, among other things, the expense of litigation.

12. The Final Order incorporating the Stipulation and Consent Agreement was issued by DBF on November 5, 1991. It provided as follows:

    
    

    Petitioner, Department of Banking and Finance, Division of Finance ("Department"), and Respondent, Sherin V. Reynolds ("Reynolds"), having entered into the attached Stipulation and Consent Agreement last dated October 31, 1991, resolving and concluding this matter:

    
    

    IT IS, THEREFORE ORDERED:

    
    

    1. The Stipulation and Consent Agreement entered into by Reynolds with the Department and attached hereto is incorporated by reference as if set forth herein at length.

    2. The Department and Reynolds shall comply with all provisions of the incorporated Stipulation and Consent Agreement.

    3. This Final Order supersedes the "Default Final Order Revoking Mortgage Brokerage License and Registration and Imposing Administrative Fines" issued by the

    Department on January 11, 1990.

    
    

    CONCLUSIONS OF LAW

    
    

13. The Florida Real Estate Commission (hereinafter referred to as the "Commission") is statutorily empowered to take disciplinary action against a State of Florida-licensed real estate salesperson based upon any of the grounds enumerated in Section 475.25(1), Florida Statutes. Such disciplinary action may include one or more of the following penalties: license denial; license revocation; license suspension for a period not exceeding ten years;

    imposition of an administrative fine not to exceed $1,000 for each count or separate offense; issuance of a reprimand; and placement of the licensee on probation. Section 475.25(1), Fla. Stat.

    
    

14. Where the disciplinary action sought is the revocation or suspension of the salesperson's license, the proof of guilt must be clear and convincing. See Ferris v. Turlington, 510 So.2d 292 (Fla. 1987); Pic N' Save v. Department of Business Regulation, 601 So.2d 245 (Fla. 1st DCA 1992); Munch v. Department of Professional Regulation, 592 So.2d 1136 (Fla. 1st DCA 1992); Newberry v. Florida Department of Law Enforcement, 585 So.2d 500 (Fla. 3d DCA 1991). "The evidence must be of such weight that it produces in the mind of the trier of fact a firm belief or conviction, without hesitancy, as to the truth of the allegations sought to be established." Slomowitz v. Walker, 429 So.2d 797, 800 (Fla. 4th DCA 1983).

    
    

15. Where the discipline does not involve the loss of licensure, the salesperson's guilt need be established by only a preponderance of the evidence. See Allen v. School Board of Dade County, 571 So.2d 568, 569 (Fla. 3d DCA 1990).

    
    

16. Regardless of the disciplinary action taken, it may be based only upon the violations specifically alleged in administrative complaint. See Kinney v. Department of State, 501 So.2d 129, 133 (Fla. 5th DCA 1987); Hunter v. Department of Professional Regulation, 458 So.2d 842, 844 (Fla. 2d DCA 1984).

17. Furthermore, in determining whether Section 475.25(1), Florida Statutes, has been violated in the manner charged in the administrative complaint, one "must bear in mind that it is, in effect, a penal statute. . . This being true the statute must be strictly construed and no conduct is to be regarded as included within it that is not reasonably proscribed by it. Furthermore, if there are any ambiguities included such must be construed in favor of the . . . licensee." Lester v. Department of Professional and Occupational Regulations, 348 So.2d 923, 925 (Fla. 1st DCA 1977).

    
    

18. The Administrative Complaint issued in the instant case charges that, given the outcome of DBF Proceeding No. 1307-F-1-1/89, the Commission is warranted in taking disciplinary action against Respondent pursuant to Section 475.455(2), Florida Statutes, and therefore Section 475.25(1)(e), Florida Statutes, as well.

    
    

19. Section 475.25(1)(e), Florida Statutes, authorizes the Commission to discipline a salesperson who "[h]as violated any of the provisions of this chapter."

    
    

20. Among the provisions of Chapter 475, Florida Statutes, are those contained 475.455(2), Florida Statutes, which provides as follows:

    
    

    If the commission finds that another state agency has suspended or revoked the license or registration of, or imposed a penalty against, a licensee, it shall issue a notice to show cause why the commission should take no action, which notice shall provide for a hearing in accordance with chapter 120, upon request.

    
    

21. In the Final Order it issued in DBF Proceeding No. 1307-F-1-1/89 on November 5, 1991, DBF, "another state agency," "imposed a penalty against" Respondent, a licensed real estate salesperson, in the form of "an administrative fine of One Thousand Dollars ($1,000.00)" and limitations upon his ability to reapply for licensure as mortgage broker.

    
    

22. That such occurred, however, does not conclusively establish that disciplinary action against Respondent by the Commission is warranted. A licensee upon whom another state agency has imposed a penalty has the opportunity, pursuant to Section 475.455(2), Florida Statutes, "to show cause why the commission should take no action."

    
    

23. Such a showing was made in the instant case.

    
    

24. The penalty that DBF assessed against Respondent in DBF Proceeding No. 1307-F-1-1/89 was not based upon any findings that Respondent had engaged in wrongdoing, but rather was imposed in accordance with a settlement agreement into which Respondent had freely and voluntarily entered, not because he was guilty of the violations with which he had been charged, but simply as a matter of convenience to resolve his dispute with DBF and for that purpose alone. Indeed, the agreement itself specifically states that it is not to be construed as an admission of guilt on Respondent's part.

25. Under such circumstances, DBF's imposition of the above-described penalty does not provide a basis upon which the Commission may take disciplinary action against Respondent pursuant to either Section 475.455(2), Florida Statutes, or Section 475.25(1)(e), Florida Statutes. Cf. The Florida Bar v. Lancaster, 448 So.2d 1019, 1021 (Fla. 1984)(while "[a]n attorney's pleading nolo contendre to a misdemeanor 1/ is relevant to his fitness to practice law," the attorney must be "given a chance to explain the circumstances surrounding his plea of nolo contendre and otherwise contest the inference that he engaged in illegal conduct"); Clark v. School Board of Lake County, 596 So.2d 735, 739 (Fla. 5th DCA 1992)("[a] plea of nolo contendre to a criminal charge is not conclusive grounds for [a teacher's] dismissal"); Kinney v. Department of State, Division of Licensing, 501 So.2d 129, 132 (Fla. 5th DCA 1987)("[w]e disagree with the agency's contention that the plea of nolo contendre to the charge of aggravated battery is conclusive evidence that Kinney committed the crime, notwithstanding the hearing officer's contrary finding;" "[a]lthough a plea of nolo contendre may be considered as evidence of guilt in an administrative proceeding, it is not conclusive and due process requires that the accused be given full opportunity to explain the circumstances surrounding his plea"); Ayala v. Department of Professional Regulation, 478 So.2d 1116, 1118-19 (Fla. 1st DCA 1985)("the Board of Medical Examiners may presumptively consider the nolo contendre plea as evidence of a conviction for purposes of chapter 458; however, in accordance with the Supreme Court's opinion in The Florida Bar v. Lancaster, 448 So.2d 1019, the Board must allow appellant the opportunity to rebut this presumption and assert his innocence of the underlying criminal charges by explaining the reasons and circumstances surrounding his plea of nolo contendre, and thereby attempt to convince the Board that he is not guilty of a crime in violation of the provisions of section 458.331(1)(c)").

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby recommended that the Commission enter a final order dismissing the instant Administrative Complaint in its entirety.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 10th day of February, 1994.

STUART M. LERNER

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 10th day of February, 1994.

ENDNOTE

1/ A plea of nolo contendre to a criminal charge has been described as "merely a formal declaration that the accused will not contest the charges with the prosecutor and is in the nature of a compromise between the state and the accused." Vinson v. State, 345 So.2d 711, 715 (Fla. 1997). As such, it is closely analogous to the "declaration" made by Respondent in the settlement agreement filed in DBF Proceeding No. 1307-F-1-1/89.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-5575

The following are the Hearing Officer's specific rulings on the "findings of facts" proposed by the parties in their post-hearing submittals:

The Department's Proposed Findings

1-5. Accepted as true and incorporated in substance, although not necessarily repeated verbatim, in this Recommended Order.

6. First and second sentences: Accepted as true and incorporated in substance; Third sentence: Rejected as a finding of fact because it is more in the nature of a legal conclusion.

7-9. Accepted as true and incorporated in substance. Respondent's Proposed Findings

1-5. Accepted as true and incorporated in substance.

1. Accepted as true, but not incorporated in this Recommended Order because it would add only unnecessary detail to the Recommended Order.

2. Accepted as true and incorporated in substance.

COPIES FURNISHED:

James H. Gillis, Esquire Senior Attorney

Department of Business and Professional Regulation,

Division of Real Estate Legal Section, Suite N 308

Hurston Building, North Tower

400 West Robinson Street Orlando, Florida 32801-1772

Jay J. Reynolds, Esquire Reynolds and Reynolds, Chartered

433 Plaza Real, Suite 271 Boca Raton, Florida 33432

Darlene F. Keller, Division Director Division of Real Estate

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

Jack McRay, Esquire General Counsel

Department of Business and Professional Regulation

1940 North Monroe Street Tallahassee, Florida 32399-0792

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 of time 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: 93-005575

Orders for Case No: 93-005575