STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
DEPARTMENT OF INSURANCE, )
)
Petitioner, )
)
vs. ) CASE NO. 94-7126
) TERESITA DEL ROSARIO CARMONA, )
)
Respondent. )
)
RECOMMENDED ORDER
Pursuant to notice, a formal hearing was conducted in this case on May 31, 1995, in Miami, Florida, before Stuart M. Lerner, a duly designated Hearing Officer of the Division of Administrative Hearings.
APPEARANCES
For Petitioner: John R. Dunphy, Esquire
Department of Insurance Division of Legal Services 612 Larson Building
Tallahassee, Florida 32399-0333
For Respondent: Carlos A. Santos, Esquire
6780 Coral Way, Second Floor Miami, Florida 33155
STATEMENT OF THE ISSUES
Whether Respondent committed the violations alleged in Second Amended Administrative Complaint?
If so, what disciplinary action should be taken against her?
PRELIMINARY STATEMENT
On or about November 23, 1994, the Department of Insurance (hereinafter referred to as the "Department") issued a two-count Administrative Complaint against Respondent, who is a licensed insurance agent. Respondent denied the allegations of wrongdoing advanced in the Administrative Complaint and requested a formal hearing. On December 22, 1994, the matter was referred to the Division of Administrative Hearings for the assignment of a Hearing Officer to conduct the formal hearing Respondent had requested.
On March 6, 1995, the Department filed an unopposed motion requesting leave to amend the Administrative Complaint issued against Respondent. By order issued March 21, 1995, the motion was granted.
The formal hearing in this case was held on May 31, 1995. 1/ At the outset of the hearing, the Department handed the Hearing Officer a Motion for Leave to Amend First Amended Administrative Complaint. Appended to the motion was the Department's Second Amended Administrative Complaint. Respondent stated that she had no objection to the Department's motion. Accordingly, the motion was granted.
Count I of the Second Amended Administrative Complaint alleges the following:
On or about October 23, 1991, you, TERESITA DEL ROSARIO CARMONA, bound homeowner's insurance coverage through Greater [Miami Insurance Agency, Inc.] for Orlando and Marta Cuevas of Opa Locka.
On or about October 23, 1991, you, TERESITA DEL ROSARIO CARMONA, received check number 808446 from Barnett Mortgage Company in the amount of
$186.00 in full payment of the insurance premium for the Cuevas[es]' policy.
On or about October 31, 1991, you, TERESITA DEL ROSARIO CARMONA, deposited check number 808446 in the Regional [Insurance Agency, Inc.] bank account number 50002713 at Continental [National Bank].
You, TERESITA DEL ROSARIO CARMONA, failed to forward, in the applicable regular course of business, the aforementioned $186.00 in premiums to any insurer as required.
You, TERESITA DEL ROSARIO CARMONA, failed to return, in the applicable regular course of business, the aforementioned $186.00 in premiums to Barnett Mortgage Company or the Cuevas[es].
You, TERESITA DEL ROSARIO CARMONA, failed to provide a policy of insurance in exchange for the aforementioned $186.00 in premiums from Barnett Mortgage Company.
On or about September 30, 1992, you, TERESITA DEL ROSARIO CARMONA, received check number 901842 from Barnett Mortgage Company in the amount of
$186.00 in full payment of the renewal insurance premium for the Cuevas[es]' policy.
On or about October 10, 1992, you, TERESITA DEL ROSARIO CARMONA, deposited check number 901842 in the Regional [Insurance Agency, Inc.] bank account number 50002713 at Continental [National Bank].
You, TERESITA DEL ROSARIO CARMONA, failed to forward, in the applicable regular course of business, the aforementioned $186.00 in renewal
premiums to the prior insurer, but rather, placed new coverage through Monticello Insurance Company (Monticello).
On or about December 17, 1992, Monticello cancelled coverage on the Cuevas[es]' home for failure to meet underwriting guidelines and refunded $150.00 to you TERESITA DEL ROSARIO CARMONA.
Again, you, TERESITA DEL ROSARIO CARMONA, failed to return, in the applicable regular course of business, the aforementioned $150.00 in return premiums to Barnett Mortgage Company or the Cuevas[es].
On or about August 24, 1992, Hurricane Andrew made landfall in south Florida causing unprecedented property damage including damage to the home of Orlando and Marta Cuevas.
As a result of your, TERESITA DEL ROSARIO CARMONA['s], failure to remit the Cuevas[es]' premium and secure a policy of insurance for their property in accordance with your represen- tations, the hurricane damage to the Cuevas[es]' home was not covered by a policy of insurance.
According to the Second Amended Administrative Complaint, in engaging in the conduct alleged in these paragraphs, Respondent violated Sections 626.561(1), 626.611(7), 626.611(8), 626.621(2), 626.621(6), 626.9521(1), 626.9521(2), and
626.9541(1)(o)1, Florida Statutes.
Count II of the Second Amended Administrative Complaint alleges the following:
On or about October 1, 1991, you, TERESITA DEL ROSARIO CARMONA, deposited check number 541 from Orlando Ruiz into Regional's bank account.
Mr. Ruiz's check in the amount of $336.00 was in payment of his homeowner's policy renewal effective September 29, 1991 through Utah Home Fire Insurance Company (Utah).
You, TERESITA DEL ROSARIO CARMONA, failed to forward, in the applicable regular course of business, the aforementioned $336.00 in renewal premiums to Utah Home Fire Insurance Company or any insurer as required or to refund same to Orlando Ruiz.
On or about August 24, 1992, Hurricane Andrew made landfall in south Florida causing unprecedented property damage including damage to the home of Orlando Ruiz.
As a result of your, TERESITA DEL ROSARIO CARMONA['s], failure to remit Mr. Ruiz's premium and secure a policy of insurance for his property in accordance with your representations, the hurricane damage to Mr. Ruiz's home was not covered by a policy of insurance.
According to the Second Amended Administrative Complaint, in engaging in the conduct alleged in these paragraphs, Respondent violated Sections 626.561(1), 626.611(7), 626.611(8), 626.621(2), 626.621(6), 626.9521(1), 626.9521(2), and
626.9541(1)(o)1, Florida Statutes.
Count III of the Second Amended Administrative Complaint alleges the following:
On or about August 11, 1989, you, TERESITA DEL ROSARIO CARMONA, received payment from Citicorp Mortgage, Inc. (Citicorp) for a home- owner's insurance policy to cover the home of Martha L. and Martha Y. Penate at 13265 S.W. 53rd Street, Miami, Florida 33175.
On or about August 11, 1989, the homeowner's policy was issued by Guardian Property and Casualty Insurance Company (Guardian) for the policy period 8/11/89 to 8/11/90.
The Penates' policy from Guardian was renewed for the period from 8/11/90 to 8/11/91.
On or about August 8, 1991, you, TERESITA DEL ROSARIO CARMONA, received check number 50921327 from Citicorp in the amount of $334 for the renewal of the Penates' policy from Guardian.
On or about August 21, 1991, you, TERESITA DEL ROSARIO CARMONA, endorsed check number 50921327
from Citicorp "Greater Mia. Ins Agency" and deposited it at Continental National Bank.
No renewal of the Penates' Guardian Policy was ever issued for the policy period 8/11/91 to 8/11/92.
You, TERESITA DEL ROSARIO CARMONA, failed to remit the $334, received from Citicorp by check number 50921327, to Guardian or any other insurer or to refund these fiduciary funds to Citicorp or the Penates in the applicable course of business.
On or about August 11, 1992, you, TERESITA
DEL ROSARIO CARMONA, received check number 51110066 from Citicorp in the amount of $334 for the renewal of the Penates' policy from Guardian for the period 8/11/92 to 8/11/93.
On or about August 14, 1992, you, TERESITA DEL ROSARIO CARMONA, endorsed check number 51110066 "Greater Miami" and deposited it into Regional's bank account.
No renewal of the Penates' Guardian Policy was ever issued for the policy period 8/11/92 to 8/11/93, however, you, TERESITA DEL ROSARIO CARMONA, were able to secure a homeowner's policy for the Penates through Scottsdale Insurance Company (Scottsdale) effective 11/13/92.
Scottsdale cancelled the Penate policy on 12/17/92.
You, TERESITA DEL ROSARIO CARMONA, failed to remit the $334, received from Citicorp by check number 51110066 to Guardian or any other insurer in the applicable regular course of business.
According to the Second Amended Administrative Complaint, in engaging in the conduct alleged in these paragraphs, Respondent violated Sections 626.561(1), 626.611(7), 626.611(8), 626.621(2), 626.621(6), 626.9521(1), 626.9521(2), and
626.9541(1)(o)1, Florida Statutes.
At the final hearing, the Department presented the testimony of seven witnesses: Lanette Wahlstrom; Marta Cuevas; Orlando Ruiz; Luisa Lopez; Martha L. Penate; Martha Y. Penate; and Catherine Cano. In addition to presenting the testimony of these seven witnesses, the Department offered, and the Hearing received, fifteen exhibits into evidence. Respondent testified in her own defense. She presented no other evidence.
At the Department's request and with Respondent's acquiescence, the evidentiary record in this case was left open for 30 days from the date of the final hearing to allow for the depositions of Orestes Arrondo and the records custodian of Citicorp Mortgage Services, Inc., (hereinafter referred to as "Citicorp") to be taken and for the transcripts of these depositions to be filed and received into evidence in lieu of the deponents' live testimony at hearing. The transcript of Arrondo's deposition (which was taken on June 13, 1995) was filed on June 28, 1995. On June 30, 1995, the Department filed a motion requesting that an affidavit (which was appended to the motion) of Citicorp's records custodian be received into evidence instead of a transcript of the records custodian's deposition (which, Petitioner indicated in its motion, it "ha[d] been unable to schedule"). According to the motion
Petitioner ha[d] provided opposing counsel
with a copy of the affidavit and ha[d] attempted to determine Respondent's position on this motion, however, as of the date of filing of this motion, no response ha[d] been received.
On July 3, 1995, in response to the filing of the motion, the Hearing Officer issued an order in which he stated the following:
No later than July 14, 1995, Respondent shall advise the Hearing Officer in writing of [her] position on Petitioner's motion.
If Respondent fails to file such a written advisement on or before July 14, 1995, the Hearing Officer will deem the motion to be unopposed and the motion will be granted.
Not having received such a written advisement from Respondent, the Hearing Officer, on July 18, 1995, issued an order granting the Department's motion.
The Department and Respondent timely filed proposed recommended orders on July 28, 1995. These proposed recommended orders have been carefully considered by the Hearing Officer. They each contain what are labelled as "findings of fact." These "findings of fact" proposed by the parties 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:
Background Information
Respondent is now, and has been at all times material to the instant case, licensed by the Department as a general lines insurance agent.
Regional Insurance Agency, Inc. (hereinafter referred to as "Regional") is an incorporated insurance agency located at 3955 Southwest 137th Avenue, #3, Miami, Florida.
Respondent is Regional's principal owner, president, secretary, and registered agent and serves on its board of directors. In addition, she works as an insurance agent for Regional.
Since on or about April 10, 1990, Respondent has maintained signatory authority over Regional's bank account (account number 50002713) at Continental National Bank.
Greater Miami Insurance Agency, Inc. (hereinafter referred to as "Greater Miami") was an incorporated insurance agency located at 1887 Southwest 1st Street, Miami, Florida, from on or about June 26, 1979, until it was administratively dissolved on or about October 11, 1991. Respondent acted as an insurance agent for Greater Miami.
Following Greater Miami's administrative dissolution, Regional took over Greater Miami's accounts and serviced them from Greater Miami's Southwest 1st Street location.
Count I
Marta and Orlando Cuevas own a home located at 1907 Northwest 46th Avenue, Opa Locka, Florida, in which they have lived since approximately October of 1972. Since their purchase of the home, the Cuevases have not replaced the roof, nor have they painted the exterior of the home.
Barnett Mortgage Company (hereinafter referred to as "Barnett") holds the mortgage on the Cuevas home.
The Cuevases make monthly payments to Barnett.
Barnett uses a portion of these payments to purchase homeowner's insurance for the Cuevases.
On or about October 23, 1991, Barnett sent a check (check number 808446) in the amount of $186.00 to Greater Miami's Southwest 1st Street location. The check was made out to Greater Miami. It was to pay, in full, for the annual premium for homeowner's insurance for the Cuevases for the 1991-92 policy year. Barnett had obtained homeowner's insurance for the Cuevases through Greater Miami for the 1990-91 policy year.
Respondent received the check and, on or about October 31, 1991, deposited it in Regional's bank account at Continental National Bank.
Respondent attempted to secure homeowner's insurance for the Cuevases. She telephoned a prospective insurer and provided information regarding the Cuevas home. The prospective insurer declined to provide coverage because of the location and condition of the home.
Respondent mailed Barnett a letter advising it of her inability to obtain homeowner's insurance for the Cuevases. Barnett, however, never received the letter.
Neither Respondent, nor Barnett, took any further measures to attempt to obtain homeowner's insurance for the Cuevases for the 1991-92 policy year.
Unbeknownst to the Cuevases, who relied on Barnett to take care of their homeowner's insurance needs, they were without homeowner's insurance for the 1991-92 policy year.
Although she did not use the $186.00 that she had received from Barnett to obtain homeowner's insurance for the Cuevases, Respondent neglected to return, in the regular course of business, the $186.00 to either Barnett or the Cuevases. It was not until March of 1995, after the Department had charged her with wrongdoing in connection with her handling of the $186.00, that she refunded the money to Barnett.
On or about August 24, 1992, Hurricane Andrew made landfall in south Florida.
The Cuevas home was damaged as a result of the hurricane.
There were damages to the roof and to the exterior of the home.
As the Cuevases discovered after filing a claim with the insurance company that had provided them with homeowner's insurance for the 1990-91 policy year, they were not insured against such damages to their home.
These damages have not been repaired inasmuch as the Cuevases have not been able to afford to pay for the repairs.
As a result of these unrepaired damages, when it rains, rainwater leaks into the Cuevas home.
On or about September 30, 1992, Barnett sent another check (check number 901842) in the amount of $186.00 to Greater Miami's Southwest 1st Street
location. The check was made out to Greater Miami. It was to pay, in full, for the annual premium for homeowner's insurance for the Cuevases for the 1992-93 policy year.
Respondent received the check and deposited it in Regional's bank account at Continental National Bank.
Respondent was successful in obtaining homeowner's insurance for the Cuevases for the 1992-93 policy year. She obtained such insurance from Monticello Insurance Company (hereinafter referred to as "Monticello").
The annual premium was more than Respondent had received from Barnett to pay for homeowner's insurance for the Cuevases for the 1992-93 policy year. Respondent used her own funds to pay the difference.
Effective December 17, 1992, Monticello cancelled the Cuevases' policy for "noncompliance with underwriting information."
The unearned premium was refunded to Respondent.
Respondent thereupon mailed to Barnett a check in an amount ($97.00) 2/ that represented what she believed was due Barnett (and ultimately the Cuevases) as a result of the cancellation of the Cuevases' policy.
Count II
Luisa Lopez and her husband, Orlando Ruiz, own a home located at 245 Northeast 26th Terrace, Miami, Florida.
For approximately the past 15 years, Lopez and Ruiz have used Respondent's services to purchase insurance for the home. During this time, they have dealt directly with Respondent.
On or about August 5, 1991, Lopez and Ruiz received a notice advising them that they needed to remit a check in the amount of $336.00 to renew their homeowner's insurance policy with Utah Home Fire Insurance Company (hereinafter referred to as Utah").
On or about September 26, 1991, Ruiz sent a check (check number 541) in the amount of $336.00 to Greater Miami's Southwest 1st Street location. The check was made out to Regional. It was to pay for the renewal of Lopez's and Ruiz's homeowner's insurance for the 1991-92 policy year. Lopez and Ruiz reasonably anticipated that, upon receiving the check, Respondent would take whatever steps were necessary to have their homeowner's policy renewed.
Respondent received the check and, on or about October 1, 1991, deposited it in Regional's bank account at Continental National Bank.
Respondent neither forwarded the $336.00 to Utah or any other insurer, nor refunded the money to Lopez and Ruiz, in the regular course of business.
Her failure to take such action was the product of neglect.
Effective November 2, 1991, Utah cancelled Lopez's and Ruiz's homeowner's policy for "non-payment of premium."
A Notice of Cancellation was mailed to Lopez and Ruiz, but never received by them.
Respondent was not sent a copy of the Notice of Cancellation.
Unaware of the cancellation, Respondent made no effort to obtain replacement coverage for Lopez and Ruiz.
When Hurricane Andrew made landfall in south Florida in August of 1992, Lopez's and Ruiz's home was not insured.
The home suffered extensive damage as a result of the hurricane.
After discovering, following the hurricane, that their home was not insured, Lopez and Ruiz retained counsel and filed suit against Respondent.
The dispute was amicably resolved in early 1995 when Lopez and Ruiz entered into a settlement agreement with Respondent.
Count III
Martha L. and Martha Y. Penate own a home located at 13265 Southwest 53rd Street, Miami, Florida.
They have lived in the home for approximately the past six years. Throughout this period of time, Respondent has been their insurance agent.
Citicorp holds the mortgage on the Penate home.
The Penates make monthly payments to Citicorp.
Citicorp uses a portion of these payments to purchase homeowner's insurance for the Penates.
On or about August 11, 1989, Respondent received payment from Citicorp to cover the cost of homeowner's insurance for the Penates.
On that same date, a policy insuring the Penate home was issued by Guardian Property and Casualty Insurance Company (hereinafter referred to as "Guardian"). The policy was effective from August 11, 1989, until August 11, 1990.
The policy was renewed for the period commencing August 8, 1990, and ending August 11, 1991.
On or about August 8, 1991, Citicorp sent a check (check number 50921327) in the amount of $334.00 to Greater Miami's Southwest 1st Street location. The check was made out to Greater Miami. It was to pay, in full, for the annual premium for homeowner's insurance for the Penates for the 1991-92 policy year.
Respondent received the check and, on or about August 21, 1991, deposited it in Regional's bank account at Continental National Bank.
As a result neglect, Respondent neither forwarded the $334.00 to Guardian or any other insurer, nor refunded the money to Citicorp or the Penates, in the regular course of business. It was not until on or about April 5, 1995, after the Department had charged her with wrongdoing in connection with her handling of the $334.00, that she refunded the money to Citicorp.
Effective August 23, 1991, Guardian cancelled the Penates' homeowner's policy for "non-payment of renewal premium."
A written notice advising of the cancellation was prepared and sent to Respondent. Respondent, however, never saw the notice.
Respondent apprised neither Citicorp nor the Penates of the cancellation of the Penates' homeowner's policy inasmuch as she herself was unaware that the policy had been cancelled.
On or about August 11, 1992, Citicorp sent a check (check number 51110066) in the amount of $334.00 to Greater Miami's Southwest 1st Street location. The check was made out to Greater Miami. It was to pay, in full, for the annual premium for homeowner's insurance for the Penates for the 1992-93 policy year.
Respondent received the check and, on or about August 14, 1992, deposited it in Regional's bank account at Continental National Bank.
Respondent's review of her records revealed that the Penates' homeowner's policy had not been renewed for the 1991-92 policy year.
Therefore, on or about August 17, 1992, Respondent wrote a letter asking Citicorp if it wanted her to "rewrite the account" or return the $334.00.
Before she received a response from Citicorp, Hurricane Andrew made landfall in south Florida.
The Penate home suffered extensive damage as a result of the hurricane.
The Penates were not insured against such damage.
After discovering, following the hurricane, that they did not have insurance to cover their losses, the Penates approached Respondent and asked her to bear the cost of repairing the damage to their home.
The amount that the Penates sought from Respondent was beyond Respondent's financial capacity to pay.
The matter is currently in litigation.
Respondent ultimately (but not in the regular course of business) obtained homeowner's insurance for the Penates from Scottsdale Insurance Company (hereinafter referred to as "Scottsdale").
The annual premium was more than Respondent had received from Citicorp to pay for homeowner's insurance for the Penates for the 1992-93 policy year. Respondent used her own funds to pay the difference, which was $221.00.
Scottsdale subsequently cancelled the Penates' policy.
CONCLUSIONS OF LAW
The Second Amended Administrative Complaint issued against Respondent in the instant case alleges violations of Sections 626.561(1), 626.611(7), 626.611(8), 626.621(2), 626.621(6), 626.9521(1), 626.9521(2), and 626.9541(1)(o)1, Florida Statutes.
At all times material to the instant case, Section 626.561(1), Florida Statutes, has provided as follows:
All premiums, return premiums, or other funds belonging to insurers or others received by an agent, solicitor, or adjuster in transactions under his license shall be trust funds so received by the licensee in a fiduciary capacity. An agent shall keep the funds belonging to each insurer for which he is not appointed, other than a surplus lines insurer, in a separate account
so as to allow the [D]epartment to properly audit such funds. The licensee in the applicable regular course of business shall account for and pay the same to the insurer, insured, or other person entitled thereto.
At all times material to the instant case, Section 626.611, Florida Statutes, has provided, in pertinent part, as follows:
The [D]epartment shall . . . suspend, revoke
. . . the license . . of any . . . agent . . ., and it shall suspend or revoke the eligibility
to hold a license . . . of any such person, if it finds that as to the . . . licensee . . . any one or more of following applicable grounds exist: . . .
Demonstrated lack of fitness or trustworth- iness to engage in the business of insurance.
Demonstrated lack of reasonably adequate knowledge and technical competence to engage in the transactions authorized by the license . . . .
If an agent is found guilty of any of these violations, revocation or suspension is "mandatory as a matter of law." Dyer v. Department of Insurance and Treasurer, 585 So.2d 1009, 1015 (Fla. 1st DCA 1991). Pursuant to Section 626.641(1), Florida Statutes, if a suspension is imposed, the period of the suspension "shall not exceed 2 years."
At all times material to the instant case, Section 626.621, Florida Statutes, has provided, in pertinent part, as follows:
The [D]epartment may, in its discretion . . .
suspend, revoke, . . . the license . . of any
. . . agent . . . , and it may suspend or revoke the eligibility to hold a license . . .
of any such person, if it finds that as to the . . . licensee . . . any one or more of the following applicable grounds exist under
circumstances for which such . . . suspension, revocation, . . . is not mandatory under s.626.611: . . .
(2) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license. . . .
In the conduct of business under the license . . . , engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part X of this chapter, or having otherwise shown himself to be a source of injury or loss to the public or detrimental to the public interest.
Sections 626.681 3/ and 626.691, 4/ Florida Statutes, authorize the Department, in lieu of discretionary suspension or revocation of the agent's license, to instead impose an administrative fine (Section 626.681) and/or place the agent on probation (Section 626.691).
At all times material to the instant case, Section 626.9521, Florida Statutes, has provided as follows:
No person shall engage in this state in any trade practice which is defined in this part [Part X of Chapter 626, Florida Statutes] as, or determined pursuant to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance.
Any person who violates any provision of this part shall be subject to a fine in an amount not greater than $2,500 for each nonwill- ful violation and not greater than $20,000 for each willful violation. Fines under this sub- section may not exceed an aggregate amount of
$10,000 for all nonwillful violations arising out of the same action or an aggregate amount of $100,000 for all willful violations arising out of the same action. The fines authorized by this subsection may be imposed in addition to any other applicable penalty.
At all times material to the instant case, Section 626.9541(1)(o)1, Florida Statutes, has provided as follows:
UNFAIR METHODS OF COMPETITION AND UNFAIR OR
DECEPTIVE ACTS.- The following are defined as unfair methods of competition and unfair or deceptive acts or practices:
Knowingly collecting any sum as a premium or charge for insurance, which is not then provided, or is not in due course to be provided, subject
to acceptance of the risk by the insurer, by an insurance policy issued by an insurer as permitted by this code.
The foregoing statutory provisions are "in effect, . . . penal statute[s] . . . This being true the[y] must be strictly construed and no conduct is to be regarded as included within [them] that is not reasonably proscribed by [them]. 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).
An agent's license may be suspended or revoked based upon the foregoing statutory provisions only if the grounds for suspension or revocation are established by clear and convincing evidence. See Ferris v. Turlington, 510 So.2d 292 (Fla. 1987); Nair v. Department of Business and Professional Regulation, 20 FLW D983 (Fla. 1st DCA April 21 1995); 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);
Pascale v. Department of Insurance, 525 So.2d 922 (Fla. 3d DCA 1988). "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).
Furthermore, the grounds proven must be those specifically alleged in the 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).
In the instant case, the Second Amended Administrative Complaint alleges that Respondent engaged in conduct violative of Sections 626.561(1), 626.611(7), 626.611(8), 626.621(2), 626.621(6), 626.9521(1), 626.9521(2), and 626.9541(1)(o)1, Florida Statutes, in connection with her handling of monies that she was supposed to use to obtain homeowner's insurance for the Cuevases (Count I), Lopez and Ruiz (Count II) and the Penates (Count III).
The Second Amended Administrative Complaint is supported by clear and convincing record evidence to the extent that it alleges that Respondent engaged in such wrongdoing by neglecting to, in the regular course of business: return to either Barnett or the Cuevases the $186.00 that she had received from Barnett to obtain homeowner's insurance for the Cuevases for the 1991-92 policy year (which insurance she did not obtain); obtain homeowner's insurance for Lopez and Ruiz for the 1991-92 policy year; return to Lopez and Ruiz the $336.00 they had sent her to obtain such insurance; obtain homeowner's insurance for the Penates for the 1991-92 and 1992-93 policy years; and return to either Citicorp or the Penates the $334.00 she had received from Citicorp to obtain homeowner's insurance for the Penates for the 1991-92 policy year.
To the extent that the Second Amended Administrative Complaint alleges that Respondent otherwise violated Section 626.561(1), 626.611(7), 626.611(8), 626.621(2), 626.621(6), 626.9521(1), 626.9521(2), and/or 626.9541(1)(o)1, Florida Statutes, it is not supported by clear and convincing record evidence and therefore should be dismissed.
Where, as in the instant case, "one has violated [both] [S]ection 626.611 and 626.621, [Florida Statutes, S]ection 626.611 governs the penalty to be imposed." Dyer v. Department of Insurance and Treasurer, 585 So.2d at 1014. The penalty, however, should be "based upon the number and severity of all offenses of which the licensee has been found guilty." Id.
In determining the particular penalty the Department should select, it is necessary to consult Chapter 4-231, Florida Administrative Code, which contains the Department's "penalty guidelines." Cf. Williams v. Department of Transportation, 531 So.2d 994, 996 (Fla. 1st DCA 1988)(agency is required to comply with its disciplinary guidelines in taking disciplinary action against its employees).
Rule 4-231.040, Florida Administrative Code, describes how the "final penalty" should be "calculated." It provides as follows:
Penalty Per Count.
The Department is authorized to find that multiple grounds exist under sections 626.611 and 626.621, Florida Statutes, for disciplinary action against the licensee based upon a single count in an administrative complaint based upon a single act of misconduct by a licensee. However, for the purpose of
this rule chapter, only the violation specifying the highest stated penalty will be considered for that count. The highest stated penalty
thus established for each count is referred to as the "penalty per count."
The requirement for a single highest stated penalty for each count in an admini- strative complaint shall be applicable regardless of the number or nature of the violations established in a single count of an administrative complaint.
Total Penalty. Each penalty per count shall be added together and the sum shall be referred to as the "total penalty."
Final Penalty. The final penalty which will be imposed against a licensee under these rules shall be the total penalty, as adjusted to take into consideration any aggravating or mitigating factors, provided however the Department shall convert the total penalty to an administrative fine and probation in the absence of a violation of section 626.611, Florida Statutes, if warranted upon the Department's consideration of the factors
set forth in rule subsection 4-231.160(1).
The "stated penalties" for violations of Section 626.611, Florida Statutes, are set forth in Rule 4-231.080, Florida Administrative Code. They include, in pertinent part, the following:
s.626.611(7), F.S.- suspension 6 months
s.626.611(8), F.S.- suspension 6 months
The "stated penalties" for violations of Section 626.621, Florida Statutes, are set forth in Rule 4-231.090, Florida Administrative Code. They include, in pertinent part, the following:
s.626.621(2), F.S.- suspension 3 months
(6) s.626.621(6), F.S.- suspension 6 months
The "stated penalties" for violations of Section 626.9541(1), Florida Statutes, are set forth in Rule 4-231.100, Florida Administrative Code. They include, in pertinent part, the following:
(15) s.626.9541(1)(o), F.S.- suspension 6 months
The "stated penalty" for a violation of Section 626.561(1), Florida Statutes, is set forth in subsection (9) of Rule 4-231.110, Florida Administrative Code. It is a "suspension [of] 9 months."
Rule 4-231.160, Florida Administrative Code, addresses the subject of aggravating and mitigating circumstances. It provides, in pertinent part, as follows:
The Department shall consider the following aggravating and mitigating factors and apply them to the total penalty in reaching the final penalty assessed against a licensee under this rule chapter. After consideration and appli- cation of these factors, the Department shall, if warranted by the Department's consideration of the factors, either decrease or increase the penalty to any penalty authorized by law.
(1) For penalties other than those assessed under rule 4-231.150:
willfulness of licensee's conduct;
degree of actual injury to victim;
degree of potential injury to victim;
timely restitution;
motivation of agent;
financial gain or loss to agent;
cooperation with the Department;
vicarious or personal responsibility;
related criminal charge; disposition;
existence of secondary violations in counts;
previous disciplinary orders or prior warning by the Department; and
other relevant factors.
In the instant case, Respondent has been found guilty, at least in part, of all three counts of the Second Amended Administrative Complaint. The "penalty per count" for each of these three counts is a nine month suspension. The "total penalty" therefore is a 27 month (or two year, three month) suspension, which is the equivalent of revocation inasmuch as a suspension, pursuant to Section 626.641(1), Florida Statutes, may "not exceed 2 years."
Having carefully considered the facts of the instant case in light of the factors listed in Rule 4-231.160, Florida Administrative Code, the Hearing Officer finds that there are insufficient "mitigating circumstances" present in the instant case, when compared to the "aggravating circumstances" present, to warrant a reduction in the "total penalty." 5/
Accordingly, the penalty that the Department should impose upon Respondent in the instant case, i.e., the "final penalty," is revocation of Respondent's license. 6/
Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby
RECOMMENDED that the Department enter a final order: (1) finding Respondent guilty of the violations noted in Conclusion of Law 82 of this Recommended Order; (2) penalizing Respondent for having committed these violations by revoking her license; and (3) dismissing the remaining allegations of misconduct advanced in the Second Amended Administrative Complaint.
DONE AND ENTERED in Tallahassee, Leon County, Florida, this 9th day of August, 1995.
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 9th day of August, 1995.
ENDNOTES
1/ The hearing was originally scheduled to commence on March 28, 1995, but was continued at Respondent's request.
2/ This was less than the full amount of the unearned premium that had been refunded to Respondent.
3/ At all times material to the instant case, Section 626.681, Florida Statutes, has provided, in pertinent part, as follows:
(1)[I]f the department finds that one or more grounds exist for the suspension, revocation, . . . [of] any license . . . issued under this chapter, the department may, in its discretion, in lieu of such suspension, revocation, .
. . , and except on a second offense . . . , impose upon the licensee . . . an administrative penalty in an amount up to $500 . . . . The administrative penalty may, in the discretion of the department, be augmented by an amount equal to any commissions received by or accruing to the credit of the licensee .
. . in connection with any transaction as to which the grounds for suspension, revocation . . . related. . . .
The department may allow the licensee . . . a reasonable period, not to exceed 30 days, within which to pay to the department the amount of the penalty so imposed. If the licensee . . . fails to pay the penalty in its entirety to the department within the period so allowed, the license of
the licensee shall stand suspended or revoked, . . . , as the case may be, upon expiration of such period.
4/ At all times material to the instant case, Section 626.691, Florida Statutes, has provided, in pertinent part, as follows:
If the department finds that one or more grounds exist for the suspension, revocation . . . [of] any license . . . issued under this part, the department may, in its discretion, except when an administrative fine is not permissible under s.626.681 . . . , in lieu of such suspension, revocation, . .
. , or in connection with any administrative monetary penalty imposed under s.626.681, place the offending licensee . . . on probation for a period, not to exceed 2 years, as specified by the department in its order.
As a condition to such probation or in connection therewith, the department may specify in its order reasonable terms and conditions to be fulfilled by the probationer during the probationary period. If during the probationary period, the department has good cause to believe that the probationer has violated such terms and conditions or any of them, it shall suspend, revoke, . . . the license . . of the probationer, as upon the original ground or grounds referred to in subsection (1).
5/ Although the violations committed by Respondent were not willful, they nonetheless caused substantial injury, at least in the case of Lopez and Ruiz and the Penates, who, as a direct result of Respondent's failure to meet her statutory obligations, did not have homeowner's insurance at the time their homes were damaged by Hurricane Andrew.
6/ A licensee whose license is revoked by the Department may not "apply for another license . . . under th[e Florida Insurance C]ode within 2 years from the effective date of such revocation or, if judicial review of such revocation is sought, within 2 years from the date of final court order or decree affirming the revocation." Section 626.641(2), Fla. Stat.
APPENDIX TO RECOMMENDED ORDER
The following are the Hearing Officer's specific rulings on the proposed "findings of fact" set forth in the parties' post-hearing submittals:
The Department's Proposed Findings
1. Rejected because it lacks sufficient evidentiary/record support.
2-4. Accepted and incorporated in substance, although not necessarily repeated verbatim, in this Recommended Order.
5. Rejected as a finding of fact because it is more in the nature of a conclusion of law than a finding of fact.
6-13. Accepted and incorporated in substance.
14. Rejected because it is contrary to the greater weight of the evidence. 15-17. Accepted and incorporated in substance.
First and second sentences: Accepted and incorporated in substance; Third sentence: Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.
Accepted and incorporated in substance.
Rejected because it is contrary to the greater weight of the evidence. 21-23. Accepted and incorporated in substance.
To the extent that this proposed finding states that Monticello "refunded $150.00 [rather than $128.71] in premium to Respondent," it has been rejected because it lacks sufficient evidentiary/record support. Otherwise, it has been accepted and incorporated in substance.
Rejected because it is contrary to the greater weight of the evidence.
Accepted and incorporated in substance.
To the extent that this proposed finding states that "the hurricane damage to the Cuevas home was not covered by a policy of insurance," it has been accepted and incorporated in substance. To the extent that it states that such lack of coverage was the result of Respondent failing to do what she had represented she would do, it has been rejected because it lacks sufficient evidentiary/record support.
First sentence: Not incorporated in this Recommended Order because, even if true, it would not alter the outcome of the instant case; Second sentence: Accepted and incorporated in substance.
Rejected because it lacks sufficient evidentiary/record support. 30-31. Accepted and incorporated in substance.
32. To the extent that this proposed finding states that the effective date of the renewal was September 29, 1991 (rather than September 27, 1991), it has been rejected because it lacks sufficient evidentiary/record support. Otherwise, it has been accepted and incorporated in substance.
33-34. Accepted and incorporated in substance.
Not incorporated in this Recommended Order because, even if true, it would not alter the outcome of the instant case.
To the extent that this proposed finding states that Lopez's and Ruiz's homeowner's policy for the 1991-92 policy year was cancelled, it has been accepted and incorporated in substance. Otherwise, it has not been incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.
37-53. Accepted and incorporated in substance.
Respondent's Proposed Findings
Rejected as a finding of fact because it is more in the nature of a summary of the allegations made in Count I of the Second Amended Administrative Complaint than a finding of fact.
(Count I)- First three unnumbered and unlettered paragraphs: Rejected as findings of fact because they are more in the nature of summaries of testimony adduced at hearing than findings of fact. See T.S. v. Department of Health and Rehabilitative Services, 20 FLW D1200 (Fla. 1st DCA May 16, 1995)(Hearing Officer's "factual findings" which "merely summarize[d] the testimony of witnesses" were "insufficient"); Paragraph A, first sentence: Accepted and incorporated in substance; Paragraph A, second sentence: To the extent that this proposed finding states that "in 1992 coverage was obtained," it has been accepted and incorporated in substance. Otherwise, it has not been incorporated in this Recommended Order because, even if true, it would not alter the outcome of the instant case; Paragraph A, third sentence: Not incorporated in this Recommended Order because, even if true, it would not alter the outcome of the instant case; Paragraph A, fourth sentence: Rejected as a finding of fact because it is more in the nature of a conclusion of law than a finding of fact.
2. (Count II)- First unnumbered and unlettered paragraph and paragraph B, before second "and:" Rejected as findings of fact because they are more in the nature of summaries of testimony adduced at hearing than findings of fact;
Paragraph B, after second "and:" Rejected as a finding of fact because it is more in the nature of a conclusion of law than a finding of fact.
2. (Count III)- First unnumbered and unlettered paragraph, first and fifth sentences: Not incorporated in this Recommended Order because, even if true, they would not alter the outcome of the instant case; Second sentence: To the extent that this proposed finding states that the cancellation notice was not mailed to Respondent, it has been rejected because it is contrary to the greater weight of the evidence. Otherwise, it has been accepted and incorporated in substance; Third and fourth sentences: Rejected as findings of fact because they are more in the nature of summaries of testimony adduced at hearing than findings of fact; Paragraph B: To the extent that this proposed finding states that Respondent did not act in a neglectful manner that resulted in the Penates not having insurance to pay for the hurricane-related damages to their home, it has been rejected because it is contrary to the greater weight of the evidence. To the extent that it states that Respondent "requested instruction from the party sending the money, the prior policy, 1991-92 was cancelled," and neither Respondent nor the Penates saw the cancellation notice, it has been accepted and incorporated in substance.
COPIES FURNISHED:
John R. Dunphy, Esquire Department of Insurance Division of Legal Services 612 Larson Building
Tallahassee, Florida 32399-0300
Carlos A. Santos, III, Esquire 6780 Coral Way
Second Floor
Miami, Florida 33155
Honorable Bill Nelson
State Treasurer and Insurance Commissioner The Capitol, Plaza Level
Tallahassee, Florida 32399-0300
Dan Sumner, Esquire Acting General Counsel Department of Insurance The Capitol, PL-11
Tallahassee, Florida 32399-0300
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.
| Issue Date | Proceedings |
|---|---|
| Oct. 10, 1995 | Final Order filed. |
| Aug. 22, 1995 | (Respondent) Exceptions to Recommended Order filed. |
| Aug. 09, 1995 | Recommended Order sent out. CASE CLOSED. Hearing held 5-31-95. |
| Jul. 28, 1995 | Petitioner`s Proposed Recommended Order filed. |
| Jul. 28, 1995 | Respondent`s Proposed Order filed. |
| Jul. 18, 1995 | Order sent out. (post-hearing submittals due in 10 days; Petitioner`s 6/30/95 Motion is granted) |
| Jul. 03, 1995 | Order sent out. (no later than 7/14/95, Respondent shall advise the hearing officer in writing of its position on Petitioner`s Motion) |
| Jun. 30, 1995 | (Petitioner) Motion for Leave to File Additional Documentary Evidence filed. |
| Jun. 28, 1995 | (Petitioner) Notice of Filing Depositions; Notice of Taking Deposition; Deposition of Orestes Arrondo filed. |
| Jun. 20, 1995 | Transcript filed. |
| May 31, 1995 | CASE STATUS: Hearing Held. |
| Apr. 06, 1995 | Order sent out. (re: Petitioner`s Motion to Compel) |
| Apr. 05, 1995 | (Respondent) Response to Motion to Compel; Reply to First Request for Production; Answer to Amended Complaint; Motion for Continuance filed. |
| Apr. 03, 1995 | Notice of Service of Petitioner`s Second Set of Interrogatories to Respondent filed. |
| Mar. 31, 1995 | Order sent out. (Motion granted) |
| Mar. 31, 1995 | Order sent out. (Motion granted) |
| Mar. 30, 1995 | (Petitioner) Motion to Compel filed. |
| Mar. 21, 1995 | Order sent out. (hearing rescheduled for 5/31/95; 8:45am; Miami) |
| Mar. 20, 1995 | (Respondent) Motion for Continuance; Cover Letter filed. |
| Mar. 06, 1995 | (Petitioner) Motion for Leave to Amend Administrative Complaint filed. |
| Feb. 01, 1995 | (Petitioner) Notice of Service of Petitioner`s First Set of Interrogatories to Respondent filed. |
| Jan. 24, 1995 | Notice of Hearing sent out. (hearing set for 3/28/95; 10:30am; Miami) |
| Jan. 20, 1995 | (Petitioner) Joint Response to Initial Order filed. |
| Jan. 10, 1995 | Initial Order issued. |
| Dec. 22, 1994 | Statement of Issues of Fact; Agency referral letter; Administrative Complaint; Election of Rights filed. |
| Issue Date | Document | Summary |
|---|---|---|
| Oct. 10, 1995 | Agency Final Order | |
| Aug. 09, 1995 | Recommended Order | License revocation recommended as appropriate penalty for insurance agent who mishandled premium payments. |
