STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PROCACCI COMMERCIAL REALTY, INC. ) AS GENERAL PARTNER OF PROCACCI ) FINANCIAL GROUP, LTD., )

)

Petitioner, )

)

vs. ) CASE NO. 95-1759BID

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent, )

)

BDC DELAND LTD., )

)

Intervenor. )

)

RECOMMENDED ORDER

A formal hearing in the above styled case was held pursuant to notice by Stephen F. Dean, assigned Hearing Officer of the Division of Administrative Hearings, on April 26 and May 22, 1995, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Robert A. Sweetapple, Esquire

Sweetapple, Broeker, and Varkas

465 East Palmetto Park Road Boca Raton, Florida 33432

For Respondent: Ellen Phillips, Esquire

HRS District 12 Legal Office

210 North Palmetto Avenue, Suite 412 Daytona Beach, Florida 32114

For Intervenor: Robert W. Morrison, Esquire

Wells, Allen, Lang and Morrison

340 North Orange Avenue Orlando, Florida 32801

STATEMENT OF THE ISSUE

There are two issues presented by Petitioner, as follows: Was the bid of Intervenor, BDC Deland Ltd., responsive?

Was the Respondent, the Department of Health and Rehabilitative Services (HRS), decision to award the bid in this case arbitrary and capricious?

PRELIMINARY STATEMENT

HRS issued an invitation to bid for the leasing of office space in Deland, Florida. There were three responses submitted to the Department: one by BDC Deland Ltd. (Paris), one by Procacci Commercial Realty, Inc., as general partner for Procacci Financial Group Ltd. (Procacci), and one from Mr. Alan Taylor. The Department considered each of their responses, and after evaluating their bids announced it intent to award the lease to Paris. Procacci filed a timely protest. Subsequently, HRS forwarded the case to the Division of Administrative Hearings.

On April 12, 1195, the Hearing Officer noticed the formal hearing for April 26, 1995, in Tallahassee, Florida. The hearing was begun on April 26, 1995, and reconvened and concluded on May 22, 1995. Between April 26, 1995 and May 22, 1995, Paris moved to intervene. Its motion was granted, and it participated in the last day of the hearing.

Petitioner called Linda Treml, Mary Goodman, Marc Weiner, and Philip Procacci as witnesses. Petitioner introduced Petitioner's Exhibits 1 through 9. HRS called Gary Schindler, Susan Siebert, Randall Baker, Kan Paris, and John Carter as witnesses. HRS introduced Respondent's Exhibits 1 and 2. Joint Exhibits 1 and 2 were introduced by agreement of the parties at the time, Procacci and HRS. Intervenor called John Carter as a witness and introduced Intervenor's Exhibits 1 through 6.

All of the parties submitted post hearing briefs containing proposed findings of fact. The proposed findings of the parties were read and considered. The Appendix to this order states which of their findings were adopted, and which were rejected and why.

FINDINGS OF FACT

1. HRS issued an invitation to bid (ITB) competitively for Lease No. 590:2438 for approximately 17,568 square feet of office space in Deland, Florida. A three percent variance in the amount of space offered was permitted.

   
   

2. The ITB required that all bidders attend a pre-proposal conference because valuable information and explanations would be provided to interest bidders at the conference which were to be complied with by the bidder. Paris and Procacci attended.

   
   

3. The requirements included providing 140 assigned (reserved) parking spaces by the bidder for the office's use. See Bid Submittal Form, Page 9 of 25.

   
   

4. The requirements contained two provisions directly relating to parking requirements, Paragraphs 11d and 21, and one which is tangentially related concerning compliance with zoning, Paragraph 6.

   
   

5. Paragraph 11d provides as follows:

   
   

   Section 11: As part of the bid submittal, bidder are to provide:

   * * *

   (d) A scaled site layout showing present location of building(s), location, config- urations and number of parking spaces

   assigned to the Department, access and egress routes and proposed changes. This is to be drawn to scale. Final site layout

   will be a joint effort between the Department an lessor to meet the needs of the Department. (Emphasis supplied.)

6. Paragraph 21 provides as follows: Section 21: Parking:

   For this facility the Department has determined that a minimum of 140 parking spaces are required to meet its needs. This parking is to be under the control of the bidder, off street, suitably paved and lined. This parking is to be provided as part of the lease cost to the Department.

   
   

   Lessor will grant to the lessee an exclusive right to use 140 parking spaces. Lessor shall

   submit with this bid submittal a letter certifying that the lessor agrees to the requested number of parking spaces on site, states the number of parking spaces per square foot of space as required by the local zoning jurisdiction and provides a site plan of the parking lot identifying the number

   of parking spaces assigned to specific other tenants. The purpose of this submittal is to assure parking spaces conform to local jurisdiction requirements

   of number and size, and that the number of parking spaces requested in this invitation can be achieved without infringing on or combining with the parking requirement of other tenants. (Emphasis supplied.)

   * * *

   Bidder Response: Parking Being Bid

   
   

   Exclusive spaces available on site. See attached site plan.

   
   

   Non-exclusive spaces available on site.

   
   

   Exclusive spaces off site located from the proposed facility

   (Distance)

   
   

   Bidder must provide recent evidence of control of all parking spaces being proposed. Permis- sion to park is not control.

   
   

7. The provisions of Section 21 were included in the lease because HRS had previously had bad experiences with parking availability. Parking, as evidenced by the requirement for a site plan and certificate to be submitted with the proposal, was an important and material provision of the lease.

   
   

8. Both Paris and Procacci submitted bid proposals, including site plans, which were deemed responsive by HRS. HRS considered the proposals of both Paris and Procacci, and performed site visits to both properties. In addition, the

   evaluators were familiar with both properties. Paris's bid was evaluated to be the lowest and best bid, and HRS noticed the bidders of its intent to award the bid to Paris.

   
   

9. At that point, Procacci asserted to HRS that Paris' proposal was deficient because it did not meet the parking requirements in terms of the quantity of parking spaces Paris could provide based upon its submittal because of the zoning requirements and impact of the "out parcels" indicated on the site plan which had been submitted.

   
   

10. After being contacted by Procacci, HRS inquired of Paris, pursuant to the terms of the RFP, if it was sure it could provide the parking as required and comply with local zoning. HRS also inquired about the status of the out parcels.

    
    

11. Paris advised that, although it had intended to try and develop the areas marked as out parcels, it did not have contracts to develop these areas, and that Paris understood that it could provide the number of parking spaces required to HRS and current and future tenants within the local zoning provisions.

    
    

12. HRS, through its counsel, checked with the local zoning official, and was advised that Paris had enough space on site to provide parking spaces complying with local codes for HRS, current tenants, and future tenants. The zoning official's estimates were based upon general assumptions about the nature of the future tenants which affected the space required for parking; however, these assumptions were generally consistent with Paris' development plan. HRS was also advised that in developing the out parcels, Paris would have to comply with existing codes including the provisions for parking.

    
    

13. Paris was the owner in fee simple of the site upon which the proposed leasehold and parking lot were located. At the time the bid was submitted, the property contained 168,000 gross square feet of leasable space, of which, 66,000 gross square feet were leased to Belk Lindsey, Dollar General, Community Dialysis, a coin laundry, the DeMarsh Theatre, and the Department of Labor. The property had vacant 101,000 gross square feet of which 18,005 gross square feet were being offered to HRS.

    
    

14. The existing leases included governmental uses, commercial uses, medical uses, and a theater. The total area of medical uses is limited to medical clinic and the Dialysis Center which had 5,184 square feet. (Only the portion of the Health Department which is clinic is treated as medical office space, and the remainder is treated as governmental use. See Volume IV, Page 568, line 4. The larger figure (5,184) for the clinic's area stated in Petitioner's Exhibit 9 is utilized for the volume of the clinic instead of Paris' figure of 4,200 square feet.) The total area of governmental uses is 71,336 square feet and includes the Department of Labor (5,000), HRS (18,000), Volusia County Environmental Health (22,277), and Volusia County Health Department (26,059). The total area of commercial uses is 49,016 square feet including Belks (41,490) and Dollar General (7,526). There was a total of 31,624 square feet vacant which Paris planned to lease for government offices.

    
    

15. Under city code, the net square area was divided by a factor to arrive at the required parking for each type of use. The factor for the various uses are as follows: Governmental-200 square feet; Commercial-250 square feet; and Medical-100 square feet. The theater would require one space for every two seats and 5 for staff. See Petitioner's Exhibit 9.

16. Utilizing the areas given above and the code's parking factors given above, the governmental offices less HRS would require 267 parking spaces. HRS would require 140 parking spaces. The clinic/dialysis center would require 52 parking spaces. The commercial uses would require 196 parking spaces, and the

    232 seat theater would require 166 parking places. It is inferred that the vacant space was to be rented to governmental activities pursuant to the landlord's plan, and would require 188 parking spaces. A total of approximately 1,010 parking spaces would be required for the entire facility computed on gross areas assuming no future changes in the existing leaseholds and the lease of all the vacant space for government offices. The city code utilizes net area to compute parking excluding rest rooms, halls, etc. However, the estimation using gross figures results in a maximum estimate.

    
    

17. Paris certified that the parking spaces were controlled by the bidder, that the parking spaces were on site and in the area indicated on the site plan submitted with the bid, and that 980 parking spaces could be accommodated. Paris' site plan also indicated the area in which the 140 parking spaces for HRS would be located. Other tenant parking was not indicated on the site plan; however, none of the other tenants had assigned parking. Paris calculated that a total of 840 spaces were required using the known data for current leases, 140 spaces for HRS, and a factor of one parking space for every 200 square feet of remaining vacant space.

    
    

18. The building official opined that the completely leased facility would require between 750 and 1050 parking spaces, and that there was enough space on site to accommodate the required parking. Other competent evidence was received that between 880 and 1,077 parking spaces meeting code requirements could be placed on the site. Estimates by qualified, knowledgeable people varied based upon assumptions about occupancy and use, whether the lot could be "grandfathered in" and how the parking lot was laid out.

    
    

19. There were enough spaces to provide parking for the HRS lease and all of the existing tenants at the time of submission of the bid proposal. However, under the existing code provisions, 140 parking spaces could not be accommodated in the rectangle indicated on Paris' site plan. This is not considered to be a material deviation from specifications because Paris had agreed to provide 140 spaces, the final arrangement and placement of the parking for HRS was subject to further negotiation, and the entire parking lot was subject to being relined. If spaces meeting code requirements would not have fit in the rectangle, Paris would have been required to adjust the size of the rectangle or design of the parking until they did fit. This was relatively easy because the other tenants did not have assigned parking.

    
    

20. The RFP provided that the successful bidder would have time to remodel the property and to bring it into compliance with existing codes. This would include the parking facilities as well as the building.

    
    

21. The HRS staff made a site visit, and were familiar with the property. They concluded that there was sufficient parking, and that Paris had made a valid, supportable offer. Their conclusion was reasonable given the opinion of the local building official and their personal knowledge of the property.

    
    

22. The RFP calls for a performance bond, and permits HRS to cancel the contract if the successful bidder cannot perform under the terms of the bid.

23. Minor deficiencies in the proposals of Procacci and Paris, which are not at issue in this case, were waived. The RFP contained no "fatal" deficiency provisions.

    
    

24. The ITB stated that HRS reserved the right to waive minor informalities or technicalities, and seek clarification of bids received.

    
    

    CONCLUSIONS OF LAW

    
    

25. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter presented herein, pursuant to Section 120.57(1), Florida Statutes.

    
    

26. Petitioner has the burden of proving by a preponderance of the evidence that it is entitled to relief. See, Rule 28-6.03(3), Florida Administrative Code. See also, Florida Department of Transportation v. J.W.C., Co., 396 So.2d 778 (Fla. 1st DCA 1981).

    
    

27. Petitioner had to establish in this proceeding that Respondent acted fraudulently, arbitrarily, illegally, or dishonestly in determining that the Intervenor's response to the RFP was "the lowest and best" within the meaning of Section 255.25(3) (a), Florida Statutes. See, D.O.T. v. Groves-Watkins Construction, 530 So.2d 912 (Fla. 1988). The thrust of Petitioner's charges were that the Intervenor's proposal was not responsive and that Department was arbitrary and capricious in awarding the bid to Intervenor. The Petitioner alleges that the bid was not responsive because the Intervenor's representations regarding parking in the Paris site plan and certificate are inaccurate because they do not reflect the existing situation and the required number of parking spaces could not be built on site.

    
    

28. Regarding whether the site plans should show existing parking or proposed parking, Paragraph 6 of the requirements states that the scaled site plan will show the present location of the buildings and the location, configuration and number of parking spaces assigned to the Department. The site plan was required to show current location of buildings only. The plain language of the requirement does not address "present" location of parking. "Present" modifies only the buildings' locations. The last sentence of Paragraph 6 reserved to HRS the right to negotiate further on the location of parking and other details. Therefore, the site plan was to show proposed parking.

    
    

29. The requirements in Paragraph 6 do not mention designating parking assigned to other tenants. That requirement is contained in Paragraph 21. It requires showing on the site plan parking spaces specifically assigned to other tenants. By its terms, it addresses current conditions. However, it does not address unassigned parking, and the record does not reflect any other tenants with assigned parking.

    
    

30. There were enough spaces to provide parking for the HRS lease and all of the existing tenants at the time of submission of the bid proposal. The Petitioner alleges that the Intervenor's statement of the number of parking spaces required is in error and that the Intervenor cannot provide the number of spaces actually required within the provisions of the city building codes.

    
    

31. Although Intervenor misstated the number of parking spaces required (840), the Petitioner's argument fails for several reasons. The first is that the terms of the lease do not limit the landlord to the utilization of on site

    parking. In fact, the check off provisions specifically address off-site parking. Although the Intervenor tendered on-site parking to HRS, it did not have to provide on-site parking to future tenants, and the RFP only required designating HRS and assigned parking on the plan. Intervenor's solution to future parking problems, should they develop, could include off site parking, and there was no requirement in the RFP to show other tenant parking unless it was assigned.

    
    

32. Second, although HRS had an obligation to check the Intervenor's representations which were alleged to be inaccurate, that obligation did not extend to an actual determination of the ultimate truth of the representations. The obligation of HRS was to determine if the Intervenor's representations were facially accurate and supportable. HRS did make inquiry of the Intervenor and of the city building official regarding the Intervenor's representations and satisfied itself that the bid was supportable and reasonable. The figures originally presented were within the range of parking spaces which the local building official opined would be required, and within the range of parking spaces which he opined could be placed on the site. After HRS awarded the bid, it was the Intervenor's obligation to perform under the terms of the contract. Under the terms of the RFP, HRS could cancel the contract if the successful bidder could not perform. At that point, HRS could make alternative arrangements, and proceed against the performance bond for damages.

    
    

33. Third, HRS had the authority to disregard minor irregularities in the bids. It did so with regard to minor matters in both Intervenor's and Petitioner's bids which are not at issue in these proceedings. Whether an irregularity is material is dependent, in part, upon whether it confers some advantage upon a bidder. While generally a smaller parking area is an advantage up to the point where it fails to meet the bid requirements, in this case there are two intervening conditions. First, as stated above, the number of parking spaces required is equal to or very close to the number which can be accommodated on Intervenor's property. Therefore, the advantage to the Intervenor is zero or very close to zero. Second, as stated above, the RFP permits all the bidder to provide off-site parking. Parking could be provided off site under the RFP's terms, and space for additional parking could be leased or purchased by the bidder as required. Therefore, irregularities regarding parking have no economic effect, and could be waived by HRS.

    
    

34. Under the circumstances, the Petitioner has failed to establish that the Intervenor's bid was unresponsive, and has failed to establish that the decision of HRS in awarding the bid to the Intervenor was arbitrary and capricious.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is,

RECOMMENDED:

That the Petitioner's Petition be dismissed.

DONE and ENTERED this 7th day of July, 1995, in Tallahassee, Florida.

STEPHEN F. DEAN, 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 7th day of July, 1995.

APPENDIX

All of the parties filed proposed findings which were read and considered.

The following states which of those findings were adopted, and which were rejected and why:

Petitioner's Recommended Order Findings

Paragraph 1 Paragraph 1.

Paragraph 2 Irrelevant.

Paragraph 3 Paragraph 5,6.

Paragraph 4 Argument and conclusions. Paragraph 5 Paragraph 7.

Paragraph 6 First sentence is contrary to best evidence.

Second sentence subsumed in other findings. Third sentence is contrary to best evidence.

Paragraph 7,8 Subsumed in Paragraph 8.

Paragraph 9 Irrelevant.

Paragraph 10 Subsumed in Paragraph 6, and Conclusions of

Law.

Paragraph 11 Subsumed in Paragraph 8.

Paragraph 12 No confusion exists. The terms of the RFP are clear.

Paragraph 13 Rejected. There is no requirement to indicate on the site plan "existing" parking, unless it is assigned to an existing tenant. There was no assigned parking for existing tenants.

Paragraph 14 Rejected. Paris' letter is based upon

assumptions regarding future occupancy and uses; however, the site plan is not based upon those assumptions.

Paragraph 15 Irrelevant.

Paragraph 16 See comments to Paragraph 14.

Paragraph 17 It was confusion for Paris to include parking spaces in areas marked "Future out parcels" on his site plan; however, this was clarified by HRS in its discussions with Paris, which indicated that there were no planned uses for those areas.

Paragraph 18 The figure of 937 spaces is not mentioned on

either of the two pages referenced. See discussion in Paragraph 19, Findings of Fact.

Paragraph 19 Paris did not certify 980 "existing" spaces.

He certified that the parking lot could accommodate 980 parking spaces.

Paragraph 20 Contrary to facts. The 813 figure was not

"identified" by HRS. Further, it is unclear from the reference to what the figure referred.

Paragraph 21 Subsumed in Paragraph 9 et seq. Paragraph 22 See discussion of Paragraph 17, above.

Paragraph 23 Subsumed in Paragraph 9 et seq., and Paragraph 13-18.

Paragraph 24 Subsumed in Paragraph 19.

Paragraph 25 Rejected as argument. Use of gross figures

increases the number of required spaces; therefore, is not misleading in making estimates of future needs.

Paragraph 26 Rejected as argument, and contrary to facts

which indicates that HRS did conduct site visits, was familiar with the facilities, and checked challenged information with city building officials.

Paragraph 27-29 Irrelevant, and subsumed in Paragraph 8.

Respondent's Recommended Order Findings

Paragraph 8 Subsumed in Paragraphs 8,13,19.

Paragraph 9 Subsumed in Paragraphs 4,5.

Paragraph 10 Subsumed in Paragraph 7.

Paragraphs 11,12 Subsumed in Paragraphs 5,19. Paragraphs 13,14 Subsumed in Paragraph 13 et seq. Paragraphs 15,16 Subsumed in Paragraph 19.

Paragraph 17 Subsumed in Paragraph 13 et seq. Paragraphs 18-21 Irrelevant.

Paragraphs 22-24 Subsumed in Paragraphs 8,23.

Paragraph 25 Subsumed 22,24.

Paragraphs 26-28 Subsumed in Paragraph 6.

Paragraph 29 Subsumed in Paragraph 2.

Paragraphs 30,31 Subsumed in Paragraphs 8,19. Paragraph 32-34 Subsumed in Paragraph 13 et seq. Paragraph 34 Subsumed in Paragraph 19.

Paragraph 35 Irrelevant.

Paragraph 36,37 Subsumed in Paragraph 19.

Paragraph 38 Subsumed in Paragraph 15.

Paragraph 39 Subsumed in Paragraph 11. Paragraphs 40-42 Subsumed in Paragraph 13 et seq. Paragraphs 43,44 Subsumed in Paragraph 17.

Paragraphs 45,46 Subsumed in Paragraphs 23-24.

Paragraph 47 Paragraph 18.

Paragraphs 48,49 Subsumed in Paragraph 19.

Paragraphs 50,51 Under the terms of the RFP, Paris had the

opportunity to bring the facilities into code compliance. Failure to do so was a basis for terminating the contract. See Paragraph 20.

Paragraph 52 Subsumed in Paragraph 19.

Paragraphs 53-60 Subsumed in Paragraphs 10-12.

Paragraph 61 Paragraph 19.

Paragraph 62 Paragraph 8. Paragraphs 63,64 Conclusions of Law.

Intervenor's Recommended Order Findings

Paragraphs 1-4 Paragraphs 1-4

Paragraph 5 Paragraph 2

6,7 Not necessary to determination of issues. Paragraphs 8i-vii Subsumed in Paragraphs 5,6,8,10,19,21.

Paragraph 9 Paragraph 13. Paragraphs 10i-viii,

11i-iv,12i-vi Paragraphs 13-17,21

Paragraph 13 Paragraph 8. Paragraphs 13i-ii Ir-relevant. Paragraph 13iii Paragraph 8. Paragraphs 13iv,v Irrelevant. Paragraphs 15-15iii Paragraphs 8,23. Paragraphs 16i-ii,17 Paragraph 8.

Paragraph 18 Paragraph 9.

Paragraphs 19,20 Paragraphs 10-12. Paragraphs 21i-v Paragraph 19.

Paragraphs 22i-vii Conclusions of Law. Paragraphs 23i-iv Paragraph 19.

Paragraph 24 Irrelevant. Paragraph 25 Conclusions of Law. Paragraph 26i-viii Paragraph 19.

COPIES FURNISHED:

Robert A. Sweetapple, Esquire Sweetapple, Broeker, and Varkas

465 East Palmetto Park Road Boca Raton, FL 33432

Ellen Phillips, Esquire

HRS District 12 Legal Office

210 North Palmetto Avenue, Suite 412 Daytona Beach, FL 32114

Robert W. Morrison, Esquire Wells, Allen, Lang and Morrison

340 North Orange Avenue Orlando, FL 32801

Robert L. Powell, Agency Clerk Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, FL 32399-0700

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. 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.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PROCACCI COMMERCIAL REALTY, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 95-1759BID

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

)

ORDER CORRECTING ORDER

The Respondent moved to correct the Recommended Order which failed to address the Respondent's motion for award of attorney's fees. Having considered the motion to retain jurisdiction on the Respondent's motion, the Hearing Officer grants the motion, and corrects the Recommended Order as follows:

The facts in this case reveal a genuine controversy regarding the agency's adherence to the terms of the RFP, the facts regarding the available parking, and the law applicable to the facts.

The Florida courts have held that a Plaintiff who initiates an action which presents a justifiable issue of law or fact is not subject to being assessed attorney's fees under a statute (Section 57.105, Florida Statutes) whose purpose is to discourage baseless claims. See Klein v. Layne, Inc. of Florida, 453 So.2d 203 (Fla. 4d DCA 1984). The courts determined that award of attorney's fees pursuant to Section 120.57(1)(b)5, Florida Statutes is for the purpose of discouraging baseless claims. See Mercedes Lighting v. Department of General Services, 560 So.2d 272 (Fla. 1 DCA 1990), in which the court also held that the court should not delve into an attorney's or party's subjective intent or into a good faith-bad faith analysis. Mercedes, at 278. If a reasonably clear legal

justification can be shown for the filing of the pleading, an improper purpose cannot be found and sanctions imposed.

Therefore, Respondent's motion for attorney's fees is denied.

DONE AND ORDERED this 24th day of July, 1995, in Tallahassee, Leon County, Florida.

STEPHEN F. DEAN

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 24th day of July, 1995.

COPIES FURNISHED:

Ellen D. Phillips, Esquire HRS District Legal Office Suite 412

210 North Palmetto Avenue

Daytona Beach, Florida 32114-3284

Robert A. Sweetapple, Esquire

465 East Palmetto Park Road Boca Raton, Florida 33432

Robert W. Morrison, Esquire

340 North Orange Avenue Orlando, Florida 32801-1611

================================================================= AGENCY FINAL ORDER

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

STATE OF FLORIDA

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES

PROCACCI COMMERCIAL REALTY,

INC., as General Partner of Procacci Financial Group, Ltd.,

Petitioner,

vs. CASE NO. 95-1759BID

RENDITION NO. HRS-95-244-FOF-BID

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES,

Respondent,

and

BDC DELAND, LTD.,

Intervenor.

/

FINAL ORDER

This cause came on before me for the purpose of issuing a final agency order. The Hearing Officer assigned by the Division of Administrative Hearings in the above-styled case submitted a Recommended Order and an Order Correcting Order to the Department of Health and Rehabilitative Services (HRS). Copies of the Recommended Order and of the Order Correcting Order of Hearing Officer Stephen F. Dean, dated July 7, 1995 and July 24, 1995, respectively, are attached hereto and incorporated.

RULINGS ON EXCEPTIONS PETITIONER' S EXCEPTIONS

Petitioner Procacci's first exception is to paragraph 8 of the Recommended Order, finding that HRS "performed site visits to both properties." Procacci would require that this finding go further and specify that the site visits should have been conducted specifically for the purpose of verifying adequate parking. However, the hearing officer's finding is supported by competent substantial evidence in the record. The record is devoid of evidence showing that the site visit(s) were or should have been conducted for the specific purpose of verifying parking. The exception is denied.

Procacci's second exception is to any implication in paragraph 9 of the Recommended Order that it was only after HRS notified the bidders of its intent to award to Intervenor that Procacci notified HRS and complained of Intervenor Paris' alleged parking inadequacies. The exception is denied. Even though there was some evidence that Procacci notified HRS prior to the award that Paris had, inter alia, a "problem with parking," there is competent substantial

evidence in the record to support the hearing officer's finding of fact in paragraph 9 of the Recommended Order.

Procacci's third exception is to paragraphs 10 and 11. The gravamen of the exception is that there is no evidence in the record to support the finding that "Paris understood that it could provide the number of parking spaces required to HRS and current and future tenants within the local zoning provisions." The exception is denied. There is competent substantial evidence in the record from which the hearing officer could properly find that Paris understood that it could provide the parking required in the bid.

Procacci's fourth exception is to finding 12. There is competent substantial evidence in the record to support the statement that the local zoning official advised HRS that Paris' parking complied with the bid, and that said zoning official's estimates were based upon general assumptions that were valid and consistent with Paris' development plan. The exception is denied. An agency cannot substitute its judgment for that of the hearing officer if the fact found by the hearing officer is supported by competent substantial evidence in the record.

Procacci next excepts to paragraph 16, that a total of 1010 parking spaces would be required based on gross area. The hearing officer weighed the conflicting evidence regarding parking and made a permissible finding. Neither Procacci nor the agency head is authorized to reweigh the evidence. There is sufficient evidence to support paragraph 16. The exception is denied.

Petitioner urges in its sixth exception that the evidence relied upon by the hearing officer to support paragraph 18 does not constitute competent substantial evidence. Petitioner is merely reweighing the evidence and substituting its judgment for that of the hearing officer. The hearing officer credited the testimony of the various witnesses who testified that Paris provided, in its bid and in its plan for development, adequate parking to satisfy the bid conditions. The exception is denied.

Procacci's seventh exception excepts to the finding in paragraph 19 of the Recommended Order that there were enough spaces to provide parking for the HRS lease and all of the existing tenants at the time of submission of the bid.

This finding is supported by competent substantial evidence. The exception is denied.

In its eighth exception, Petitioner asserts that the site visit in paragraph 21 of the Recommended Order did not result in HRS' staff's determination that there was ample parking. This assertion overlooks that the HRS staff may have been familiar with the Paris property and had knowledge of the property other than by site visits in connection with this particular bid. The exception is denied. Finding 21 is entirely permissible based on the record evidence.

Petitioner's ninth exception is to the last sentence of paragraph 29, which concludes that paragraph 21 of the bid does not address unassigned parking and the record does not reflect any other tenants with assigned parking. The hearing officer is correct that paragraph 21 of the bid conditions addresses current conditions as opposed to speculation regarding future tenants and future development. The exception is denied.

Procacci's tenth exception is to paragraph 30 to the extent it concludes that Paris had enough parking spaces to accommodate HRS and all existing

tenants. There is more than enough competent evidence to support the conclusion. The evidence is overwhelming that adequate parking is and will continue to be available at the site. As long as there is enough actual parking available so that those needing to park may do so, it is not impermissible to reserve "future out parcels." The exception is denied.

Paragraph eleven of Procacci's exceptions takes exception to paragraph 31 of the Recommended Order. Paragraph 31 is eminently reasonable in its conclusion that future tenants do not necessarily require on-site parking. The exception is denied. The bid conditions require 140 on-site parking spaces for HRS use. Vacancies in the shopping center's space available for leasing mean parking can be "achieved without infringing on or combining with the parking requirements of other tenants." Section 21 of the ITB. The Department does not intend for the potential parking needs of prospective future tenants to be used, as Petitioner attempts here, to thwart a bid containing obviously adequate parking.

Exception twelve is denied. There are no erroneous findings of fact in this case. Therefore exception twelve, excepting to conclusion 32 because it is "based on erroneous findings of fact previously identified," is without merit.

The facts overwhelmingly demonstrate that ample parking in compliance with the obvious intent of the bid conditions has been bid by Paris. HRS does not need 1010 parking spaces; it only needs 140.

Exception thirteen argues that conclusion of law 33 should be rejected because finding 7, that "parking . . . was an important and material provision of the lease," precludes a conclusion that the absence of a few of the required parking spaces might be found, under the circumstances present in this case, to be a minor irregularity. The hearing officer's conclusion in paragraph

33 is correct. The number of parking spaces to be provided by Paris is equal to or very close to the number needed by HRS. Further, as found by the hearing officer, off-site parking is permitted by the RFP. Therefore, if minor irregularities regarding parking exists, no economic advantage to Paris is provided and such irregularities would be waivable by HRS. The exception is denied.

DEPARTMENT'S EXCEPTIONS

Respondent HRS filed three exceptions. First, it takes exception to the finding in paragraph 19 that 140 parking spaces could not be accommodated under the existing code in the rectangle indicated on Paris' site plan. Respondent shows in its exception that a second rectangle in the rear contains 20 parking spaces. Finding(s) of fact regarding additional parking spaces in the rear were not specifically addressed in the hearing officer's paragraph 19. However, the hearing officer correctly found that Paris could provide 140 parking spaces and the final arrangement and placement of such parking was subject to further negotiation which could result in the entire parking lot being realigned. The exception is denied.

Paragraph 2 of HRS' exceptions requests that sentence two of paragraph 19 of the Recommended Order be replaced with language of HRS' choice: "Petitioners contended the 140 spaces contained in the two parking areas Paris proposed did not all conform to current code." The exception is denied.

Respondent's third exception is that the hearing officer failed in his recommended order to rule on HRS' Motion for Attorney's Fees, Damages, and Costs. The exception is denied. Hearing Officer Stephen F. Dean denied HRS'

Motion for Attorney's Fees, Damages, and Costs and corrected his recommended order to reflect such denial.

DEPARTMENT'S EXCEPTIONS TO CORRECTED ORDER

Respondent filed exceptions urging that the hearing officer erred in finding that the instant protest was not frivolous. The exception is denied.

FINDINGS OF FACT

The Department hereby adopts and incorporates the findings of fact set forth in the Recommended Order and Order Correcting Order.

CONCLUSIONS OF LAW

The Department hereby adopts and incorporates the conclusions of law set forth in the Recommended Order and Order Correcting Order.

Jurisdiction is reserved to take evidence, make findings, and enter orders pursuant to s. 255.25(3)(c), Fla. Stat.

Based upon the foregoing, it is

ADJUDGED that Petitioner's petition be and the same is hereby DISMISSED. DONE and ORDERED this 24th day of August, 1995, in Tallahassee, Florida.

Edward A. Feaver Acting Secretary

Department of Health and Rehabilitate e Services

By: Lowell Clary

Deputy Secretary for Administration

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF HRS, AND A SECOND COPY, ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.

COPIES FURNISHED:

Robert A. Sweetapple, Esquire Sweetapple, Broeker and Varkas

465 East Palmetto Park Road Boca Raton, Florida 33432

Robert W. Morrison, Esquire Wells, Allen Lang and Morrison

340 North Orange Avenue Orlando, Florida 32801

Ellen Phillips, Esquire

HRS District 12 Legal Office

210 North Palmetto Avenue, Suite 412 Daytona Beach, Florida 32114

Hearing Officer Steven F. Dean Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true copy of the foregoing FINAL ORDER has been sent by U.S. Mail to the above-named persons this 25th day of August, 1995

Robert L. Powell, Sr. Agency Clerk

Department of Health and Rehabilitative Services

Building E, Suite 200 1323 Winewood Blvd.

Tallahassee, Florida 32399-0700

(904) 488-2381

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

DISTRICT COURT OPINION

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

IN THE DISTRICT COURT OF APPEAL FIRST DISTRICT, STATE OF FLORIDA

PROCACCI COMMERCIAL NOT FINAL UNTIL TIME EXPIRES TO REALTY, INC., as General FILE MOTION FOR REHEARING AND

Partner of Procacci DISPOSITION THEREOF IF FILED. Financial Group, Ltd.,

vs.

CASE NO. 95-3317

Appellant/ DOAH CASE NO. 95-1759BID

Cross-Appellee,

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES,

and

Appellees/

Cross-Appellant,

BDC DELAND. LTD.,

Appellee.

/ Opinion filed January 22, 1997.

Alexander D. Varkas, Jr., and Robert A. Sweetapple of Sweetapple, Broeker & Varkas, Boca Raton, for Appellant/Cross-Appellee.

Ellen D. Phillips, Assistant District Legal Counsel, and Daniel T. Medved, District Legal Counsel, Daytona Beach, for Appellee/Cross-Appellant Department of Health and Rehabilitative Services.

Robert W. Morrison of Allen, Lang, Morrison & Curotto, P.A., Orlando, for Appellee BDC Deland, Ltd.

BENTON, J.

ON MOTION FOR REHEARING OF ORDER GRANTING ATTORNEYS' FEES

A motion--appellant's motion for rehearing of court's order of September 23, 1996 awarding attorneys' fees and costs to the State of Florida, Department of Health and Rehabilitative Services and BDC Deland, Ltd. pursuant to Section 120.57(1)(b)(10), Florida Statutes--asks that we vacate our order awarding fees and costs, 1/ contending that the main "appeal raised . . . the same issues of fact and issues of law litigated before the Hearing Officer, [2]" who found them not to be frivolous. In its reply to motion for rehearing, the Department responds:

Irrespective of the legitimacy of

Appellant's factual disputes below, Appellant raised no colorable issue disputing the findings of the Hearing Officer below, but, rather, consistently misrepresented the testimony without regard to the record.

Further, Appellant failed to acknowledge well- established case law controlling the standards of review in bid protest cases. Appellant did not even cite controlling Supreme Court precedent, citing, rather, lower court cases which were subsequently reversed.

The reply to motion for rehearing also "reassert[ed] the essentially frivolous nature of the litigation below," a bid dispute proceeding which Procacci Commercial Realty, Inc. (Procacci) initiated by filing a protest when the Department of Health and Rehabilitative Services 3/ (HRS) announced its intention to lease office space from BDC Deland, Ltd. (BDC) instead of from

Procacci. We see no reason to vacate the order 4/ awarding fees and costs, but take this opportunity to clarify the scope of the award.

On the main appeal, HRS's final order, entered on August 25, 1995, was affirmed without opinion. Procacci Commercial Realty, Inc. v. Department of Health and Rehabilitative Servs., No. 95-3317 (Fla. 1st DCA Sept. 23, 1996) . The final order adopted a recommended order entered on July 7, 1995, including the recommendation that Procacci's formal written protest be dismissed. The final order also purported 5/ to adopt the administrative law judge's "order correcting order" entered on July 24, 1995, which denied attorney's fees HRS sought under section 120.57(1)(b)5., Florida Statutes (1995)

Bid Protest

HRS's invitation to bid (lease number 590:2438) seeking space for HRS offices in Deland specified that bidders provide 140 reserved parking spaces for HRS's exclusive use. 6/ As part of their bids, bidders were to supply a scaled site drawing showing the layout of buildings and the location and configuration of parking spaces to be allocated to the Department, along with a letter certifying that the prospective lessor agreed to supply 140 parking spaces on site, stating the number of "parking spaces per sq. ft. of [floor] space," and specifying the number of parking spaces assigned to other tenants, if any. HRS expressly reserved the right to seek clarification or to waive non-material deviations from technical requirements of the bid. 7/

BDC proposed to lease HRS some 18,000 square feet in Woodland Plaza, a shopping center BDC was renovating. Procacci's formal written protest asserted that BDC's bid was nonresponsive to the invitation to bid in that:

1. In order to comply with the terms of the bid, the bidder was required to prove 140 exclusive parking spaces for the benefit o[f] HRS. In order to do so, Dan Paris, BDC Deland, Ltd. would be required to provide 897 spaces at the site. In its bid, Dan Paris incorrectly stated that only 840 spaces were needed in order to provide compliance with the code and in order to provide the 140 exclusive spaces required in the invitation to bid. The Dan Paris bid represented that 980 spaces are available in the subject parking space. The plan reveals, however, that only 937 spaces are available. In addition, in excess of 50 of these spaces are not to code standards. Therefore, Dan Paris has not and cannot provide adequate parking to meet the requirements of the bid.

2. Separate and apart of [sic] the above, the bid of Dan Paris shows two areas that are reserved for future out-parcel development. As a matter of law, this space may not be included in calculation of the parking since it is reserved for other uses. In excess of

150 spaces are located in this area, separately rendering the bid non-responsible [sic] with regard to the parking requirement.

Evidence showed BDC had rented only 66,000 of the 168,000 gross square feet in Woodland Plaza, and that there would have been adequate parking on site even if all 168,000 gross square feet in Woodland Plaza had been occupied.

The recommended order found that a local zoning official had determined that BDC "had enough space on site to provide parking spaces complying with local codes for HRS, current tenants and future tenants." As alleged, BDC's site plan included two boxes in the area representing the parking lot, each labeled "future out- parcel." But the evidence showed that BDC owned the entire site and had not contracted to sell any of it; and that the City of Deland would not permit use of the potential "future out-parcels," except for parking, without prior approval. Such approval would, the evidence showed, entail meeting all code requirements, including making provision for adequate green space and parking.

The parking lot at Woodland Plaza was much bigger than necessary to provide HRS exclusive use of 140 legal and conforming parking spaces on site, without compromising or infringing upon parking spaces available for the other tenants, none of whom had assigned parking. Indeed, Procacci conceded that there was enough parking, at the time bids were submitted and at the time of the hearing, claiming only that problems would arise in the future. The questions Procacci raised about the future were all decided adversely to Procacci's position, however. Unequivocal findings were amply supported by competent evidence in this regard.

Sanctions Sought Below

Within two weeks of Procacci's formal written protest, see Stockman v. Downs, 573 So.2d 835 (Fla. 1991), HRS filed a motion to dismiss/petition for attorney's fee, damages, and costs in which it alleged:

The Department is entitled to attorneys fees, damages, and costs pursuant to Section 120.57(1)(b)(5), in that the protest is filed to harass the Department and cause unnecessary delay in removing to the new leased facility, requiring the Department to remain in facilities currently leased from Procacci at a cost to the Department in Excess of $4000. per month, and resulting in unjust enrichment to Procacci.

Former section 120.57(1)(b)5. and its successor, section 120.569(2), Florida Statutes (Supp. 1996), authorize attorney's fee awards in administrative proceedings, 8/ if a pleading is filed for an improper purpose. But the hearing officer found no improper purpose. 9/

Since HRS never appealed the administrative law judge's determination that Procacci did not file its formal written protest for improper purposes, the propriety of that ruling is not a question we have for decision on appeal. The "order correcting order" denying fees under former section 120.57(1)(b)5. must stand. But Procacci goes further and argues that the administrative law judge's determination under former section 120.57(1)(b)5. precludes the award of attorneys' fees under section 120.57(1)(b)10., Florida Statutes (1995). We reject this contention. Two distinct questions are involved. They require separate consideration and discrete resolution.

Frivolous Appeal Warrants Award of Fees

An appellate court "may award reasonable attorney's fees and [reasonable] costs to the prevailing party if the court finds that the appeal was frivolous, meritless, or an abuse of the appellate process." s 120.57(1)(b)10., Fla. Stat. (1995). This language 10/ authorizes an award in favor of an administrative agency. See RHPC, Inc. v. Dep't of Health and Rehabilitative Services, 509 So.2d 1267 (Fla. 1st DCA 1987). Because Procacci's bid protest raised "a disputed issue of material fact, [HRS] . . . refer[red] the protest to the division for proceedings under s. 120.57(1)." s 120.53(5)(d)2., Fla. Stat. (1995). With entry of the recommended order, HRS regained jurisdiction of the bid dispute and entered the final order. 11/ As appellee defending its order on appeal, HRS was a prevailing party just as BDC was.

In Treat v. State ex rel Mitton, 121 Fla. 509, , 163 So. 883, 883-84 (1935), our supreme court defined a frivolous appeal:

A frivolous appeal is not merely one that

is likely to be unsuccessful. It is one that is so readily recognizable as devoid of merit on the face of the record that there is little, if any, prospect whatsoever that it can ever succeed. See Hokinson v. Kennedy, 225 Mass. 231, 114 N.E. 204 [1916]. It must

be one so clearly untenable, or the insufficiency of which is so manifest on a bare inspection of the record and assignments of error [or briefs, in keeping with modern practice], that its character may be determined without argument or research. An appeal is not frivolous where a substantial justiciable question can be spelled out of it, or from any part of it, even though such question is unlikely to be decided other than as the lower court decided it, i.e., against appellant or plaintiff in error.

(Footnote omitted.) The manifest insufficiency of the appeal Procacci brought in this case is paradigmatic.

In light of the administrative law judge's adverse and fully supported fact findings, Procacci's catchall contention that HRS's decision to lease space from another landlord (at less cost, in order to save taxpayers' money) was "arbitrary and capricious" wholly lacked merit. Rehashing the asserted unavailability of an "island"--in a virtual sea of parking spaces--on which HRS employees could park their cars was an abuse of the appellate process.

Procacci's only other point on appeal--the contention that the five or six pages of the final order devoted to a discussion of the thirteen exceptions Procacci took to the recommended order lacked adequate detail--had no more merit than the contention that HRS acted arbitrarily and capriciously. The appeal taken by Procacci was "frivolous, merit less, or an abuse of the appellate process." Both HRS and BDC are entitled 12/ to be reimbursed for reasonable attorneys' fees occasioned by the appeal. Here, as in Branch v. Charlotte County, 627 So.2d 577, 579 (Fla. 2d DCA 1993), the appellant's principal strategy has been to reargue[] the facts previously presented to the lower [tribunal] ."

We remand to the Division of Administration Hearings for a determination of the amount of fees and costs. See, e.g., University Community Hosp. v. Dep't of Health and Rehabilitative Servs., 493 So.2d 2 (Fla. 2d DCA 1986). Unless the parties can agree on the amount of fees and costs, evidence has to be taken on these questions. See Dep't of Admin., Office of State Employees' Ins. v.

Ganson, 566 So.2d 791 (Fla. 1990). Entitlement is limited to fees and costs reasonably incurred by appellees in defending the appeal. While awards against an agency may in appropriate circumstances encompass fees and costs "for the administrative proceeding and the appellate proceeding," s 120.595(5), Fla.

Stat. (Supp. 1996), see Titzel v. Department of Prof'l Regulation, Bd. of Prof'l Eng'rs, 599 So.2d 279 (Fla. 1st DCA 1992); Johnston v. Department of Prof'l Regulation, Bd. of Med. Exam'rs, 456 So.2d 939 (Fla. 1st DCA 1984), neither former section 120.57(1)(b)10. nor its successor authorizes an award against a private party for costs or fees incurred in the administrative proceedings from which the appeal is taken.

Appellant's motion for rehearing of court's order of September 23, 1996 awarding attorneys' fees and costs to the State of Florida, Department of Health and Rehabilitative Services and BDC Deland, Ltd. pursuant to section 120.57(1)(b)(10), Florida Statutes, is denied.

ERVIN and KAHN, JJ., CONCUR.

ENDNOTES

1/ Although we granted appellees' motions for fees and costs, the award of costs is automatic under Florida Rule of Appellate Procedure 9.400(a), which provides that costs "shall be taxed in favor of the prevailing party unless the court orders otherwise." Schoettle v. State, Dep't of Admin., Div. of Retirement, 522 So.2d 962 (Fla. 1st DCA 1988)

2/ On October 1, 1996, hearing officers of the Division of Administrative Hearings became "administrative law judges." Ch. 96-159, s 31, at 199, Laws of Fla.

3/ As recently amended, section 20.19, Florida Statutes (Supp. 1996), redesignates the Department of Health and Rehabilitative Services as the Department of Children and Family Services. Ch. 96-403, s 5, at 2645, Laws of Fla. Certain powers, duties, and sanctions of the former Department of Health and Rehabilitative Services are transferred to the newly created Department of Health. Ch. 96-403, ss 6, 8 at 2675-76, Laws of Fla. The Division of Statutory Revision of the Joint Legislative Management Committee has also been directed to:

prepare a reviser's bill for introduction at a subsequent session of the Legislature to change "Department of Health and Rehabilitative Services" to "Department of Children and Family Services," wherever that term appears in chapters 39, 63, 410, 411,

414, 415, and 419, Florida Statutes, and 55. 409.016-409.803, Florida Statutes; to change "Department of Health and Rehabilitative Services" to "Department of Health," wherever the term appears in chapters 153, 154, 381,

382, 383, 384, 385, 386, 387, 388, 390, 391,

and 392, Florida Statutes; to change "county public health unit" to "county health department" wherever the term appears in Florida Statutes; and to make such further changes as are necessary to conform the Florida Statutes to the organizational changes effected by this act.

Ch. 96-403, s 26, at 2691, Laws of Fla.

4/ The body of the order entered on September 23, 1996, reads:

The State of Florida, Department of Health and Rehabilitative Services' and BDC Deland Ltd.'s motions for attorney's fees and costs, filed pursuant to section 120.57(1)(b)(10), Florida Statutes, are granted. The hearing officer is directed to set an appropriate

amount of attorney's fees to be awarded to the Department of Health and Rehabilitative Services and BDC Deland Ltd.

Procacci Commercial Realty, Inc.'s motion for attorney's fees is denied.

Although the rehearing motion concludes with a prayer that the entire September 23, 1996, order be vacated, it does not specifically question denial of Procacci's motion for attorney's fees.

5/ In Department of Health & Rehabilitative Services v. S.G., 613 So.2d 1380 (Fla. 1st DCA 1993), we held that, when a recommended order reserves jurisdiction to determine the amount of fees and costs to be assessed against the agency, the agency cannot employ its final order authority to overturn by fiat an award of attorneys' fees and costs entered against it under former section 120.57(1)(b)5. See Florida Audubon Soc'y v. Remington, 12 F.A.L.R. 3400 (Fla. Dept. of Environmental Protection 1990). Here HRS had no jurisdiction to review the hearing officer's ruling refusing to award sanctions it sought against Procacci.

Whether denominated interlocutory or final, an order awarding costs and fees under former section 120.57(1)(b)5. or current section 120.569(2)(c) is reviewable only in an appropriate appellate court. Both provisions authorize sanctions for papers filed for improper purposes. Such sanctions may require reimbursement of fees and costs incurred by any injured party and may be imposed against governmental and private parties alike.

Neither HRS nor any other agency has authority to review fee and cost awards that administrative law judges make under the authority of section 120.569(2)(c), Florida Statutes (Supp. 1996), or which hearing officers made under the predecessor provision, section 120.57(1)(b)5., Florida Statutes (1995). Only an administrative law judge or a hearing officer had authority to make awards under these provisions. Chipola Basin Protective Group, Inc. v.

State, Dep't of Envtl. Regulation, 11 F.A.L.R. 467 (Fla. Dept. of Environmental Protection 1988) . A referring agency--itself ordinarily a litigant--can neither make nor reverse such awards.

6/ The invitation to bid included the following specifications concerning parking spaces:

[Sectionj 11: As part of the bid submittal, bidders are to provide:

(d) A scaled site layout showing present location of building(s), location, configuration and number of parking spaces

assigned to the department, access and egress routes and proposed changes. This is to be drawn to scale. Final site layout will be a joint effort between the department and lessor to best meet the needs of the department. [Section] 21: Parking:

For this facility the department has determined that a minimum of 140 parking spaces are required to meet its needs. This parking is to be under the control of the bidder, off street, suitably paved and lined. This parking is to be provided as part of the lease cost to the department.

Lessor will grant to the Lessee an exclusive right to use 140 parking spaces. Lessor shall submit with this Bid Submittal a letter certifying that the Lessor agrees to the requested number of parking spaces on site, states the number of parking spaces per sq. ft. of space as required by the local zoning jurisdiction and provides a site plan of the parking lot identifying the number of parking spaces assigned to specific other tenants.

The purpose of this submittal is to assure parking spaces conform to local jurisdiction requirements of number and size, and that the number of parking spaces requested in this invitation can be achieved without infringing on or combining with the parking requirement of other tenants.

BIDDER RESPONSE: PARKING BEING BID

Exclusive spaces available on site.

Non-exclusive spaces available on site.

Exclusive spaces off site located from the proposed facility.

(Distance)

Bidder must provide recent evidence of control of all parking spaces being proposed.

Permission to park is not control.

At a mandatory pre-bid conference, the Department of Health and Rehabilitative Services had informed all bidders that the intent of the certifying letter in section 21 was to ensure the parking area was under the bidder's control and that the bidder had the ability to perform the terms of the contract.

7/ Although a bid containing a material variance is unacceptable, not every deviation from the invitation is material." Robinson Elec. Co. v. Dade County,

417 So.2d 1032, 1034 (Fla. 3d DCA 1982); Tropabest Foods, Inc. v. State, Dep't of Gen. Servs., 493 So.2d 50, 52 (Fla. 1st DCA 1986)(citation omitted); Glatstein v. Miami, 399 So.2d 1005 (Fla. 3d DCA) review denied, 407 So.2d 1102 (Fla. 1981). "It is only material if it gives the bidder a substantial advantage over the other bidders and thereby restricts or stifles competition." Tropabest, 493 So.2d at 52; Harry Pepper & Assocs., Inc. v. City of Cape Coral, 352 So.2d 1190, 1193 (Fla. 2d DCA 1977).

8/ Asserting the complete lack of a justiciable issue, HRS also invoked section 57.105, Florida Statutes, as a basis for the award of attorney's fees it sought from the administrative law judge (as he is now known) . But section 57.105 only applies to judicial proceedings. In the circumstances section 57.105 specifies, it authorizes a "court [to] award a . . . fee . . . in any civil action." Cf. City of Naples Airport Auth. v. Collier Dev. Corp., 515 So.2d 1058, 1059 (Fla. 2d DCA 1987)("[S]ection 57.041 provides for costs in judicial actions only.") . See generally Farzad v. Department of Prof'l Regulation, 443 So.2d

373 (Fla. 1st DCA 1983); Landes v. Department of Prof'l Regulation, 441 So.2d 686 (Fla. 2d DCA 1983), review denied, 451 So.2d 849 (Fla. 1984); and Donaldson

v. State, Dep't of Health and Rehabilitative Servs., 425 So. 2d 145 (Fla. 1st DCA 1983)

9/ The statutory examples of improper purpose are "to harass or to cause unnecessary delay or for frivolous purpose or needless increase in the cost of litigation." Federal Rule of Civil Procedure 11 was a model of sorts for former section 120.57(1)(b)5., but there are differences, as pointed out in Mercedes Lighting and Electrical Supply Inc. v. State, Department of General Services, 560 So.2d 272, 277 (Fla. 1st DCA 1990)

The signature requirement under rule 11 is directed at three substantive prongs: the factual basis of the paper, the legal basis of the paper, and its legitimate purpose. Under the statute, the signature certifies only that the paper is not interposed for an improper purpose. But, unlike the rule, section 120.57(1)(b)5. includes "frivolous purpose" as an example of "improper purpose."

560 So.2d at 277 (citation omitted) . Eschewing a subjective good faith-bad faith test, see Rodgers v. Lincoln Towing Serv. Inc., 771 F.2d 194 (7th Cir. 1985), the Mercedes court concluded that a finding of improper purpose could not stand "if a reasonably clear legal justification can be shown for the filing of the paper." 560 So. 2d at 278.

The use of an objective standard creates a requirement to make reasonable inquiry regarding pertinent facts and applicable law. In the absence of "direct evidence of the party's and counsel's state of mind, we must examine the circumstantial evidence at hand and ask, objectively, whether an ordinary person standing in the party's or counsel's shoes would have prosecuted the claim." Pelletier v. Zweifel, 921 F.2d 1465, 1515 (11th Cir. 1991) Federal cases applying an objective standard to determine improper purpose include Donaldson

v. Clark, 819 F.2d 1551 (11th Cir. 1987); Eastway Construction Corp. v. City of New York, 762 F.2d 243 (2d Cir. 1985); Ginther v. Texas Commerce Bank, N.A., 111

F.R.D. 615 (S.D. Tex. 1986); and Andre v. Merrill Lynch Ready Assets Trust, 97

F.R.D. 699 (S.D.N.Y. 1983)

An administrative complaint found not to be supported by a permissible interpretation of applicable statutes and rules was held to have been filed for an "improper purpose," despite "an absence of frivolousness," in Good Samaritan Hospital v. Department of Health and Rehabilitative Services, 582 So.2d 722, 723 (Fla. 4th DCA 1991). On the other hand, in Cubic Western Data v. Department of Transportation (No. 89-6926B1D, DOAH, Jan. 25, 1990), the hearing officer found-

-rightly or wrongly--no improper purpose in a bid protest filed by a bidder who had earlier agreed with the department's determination that its bid was nonresponsive. Former section 120.57(1)(b)5. has been said to "include[] the parties' qualified representative in the requirement that the pleading, motion or other paper be signed but does not address the consequences for failure to sign, whereas rule 11 provides for striking an unsigned pleading." Mercedes Lighting, 560 So.2d at 277 n.4.

10/ The same language now appears in section 120.595(5), Florida Statutes (Supp. 1996). In the current version, the word "reasonable" precedes the word "costs." As to the award of appellate costs, see ante, n.1.

11/ In section 120.57 substantial interest proceedings, the referring agency enters the final order and has no right (nor any need) to appeal its own order. Only other parties can appeal. Since it is private parties (or--much less frequently--governmental litigants other than the referring agency) who initiate appeals, awards on the basis of frivolous appeals from agency orders will generally be against private parties, as in the present case. Where a third party is aligned with the agency whose order is appealed, fee awards may be entered in favor both of the agency and of the party aligned with the agency-- here BDC.

12/ We recognize that former section 120.57(1)(b)10. is discretionary, unlike section 57.105, Florida Statutes (1995), which is mandatory. "We remind trial judges and the bar that our legislature said in section 57.105 that courts

`shall' assess attorney's fees for the bringing of frivolous litigation." Sykes

v. St. Andrews Sch., 625 So.2d 1317, 1319 (Fla. 4th DCA 1993)(appellate attorney's fees awarded where party did not abandon appeal after supreme court resolved sole justiciable issue). Where a suit is "completely devoid of a justiciable issue of either law or fact . . . the statute's mandatory provision is operative and requires an award of a reasonable attorney's fee." Galbraith v. Inglese, 402 So.2d 574, 574 (Fla. 4th DCA 1981)

Docket for Case No: 95-001759BID

Orders for Case No: 95-001759BID