STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) CASE NO. 96-5606

)

PABLO F. HOFLE, )

)

Respondent. )

RECOMMENDED ORDER

An administrative hearing was conducted in this proceeding on February 14, 1997, in Orlando, Florida, before Daniel Manry, Administrative Law Judge, Division of Administrative Hearings. The parties, witnesses, and court reporter attended the hearing in Orlando. The undersigned participated by video conference from Tallahassee, Florida.

APPEARANCES

For Petitioner: Daniel Villazon, Esquire

Department of Business and Professional Regulation

Division of Real Estate

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

For Respondent: Edward A. Kerben, Esquire

725 North Magnolia Avenue Orlando, Florida 32803

STATEMENT OF THE ISSUES

The issues in this case are whether Respondent violated Section 475.42(1)(a), Florida Statutes (1995), by operating as a real estate broker without a license and, if so, what, if any, penalty should be imposed.

PRELIMINARY STATEMENT

Petitioner filed an Administrative Complaint against Respondent on October 18, 1996. Respondent timely requested an administrative hearing.

At the hearing, Petitioner presented the testimony of two witnesses and submitted six exhibits for admission in evidence. Respondent testified in his own behalf, called one witness, and submitted three exhibits for admission in evidence.

The identity of the witnesses and exhibits, and the rulings regarding each, are set forth in the transcript of the hearing filed with on March 11, 1997. The parties timely filed their respective proposed recommended orders ("PRO") on April 2, 1997.

FINDINGS OF FACT

1. Petitioner is the state agency responsible for regulating the practice of real estate. Respondent is the president of Lenox Investments & Development, Inc. ("Lenox"). Lenox shares office space with Lenox Realty Corporation ("Lenox Realty").

2. Mr. Richard Fess is the qualifying and managing broker for Lenox Realty. Mr. Carlos Hofle is Respondent's brother, a licensed real estate agent, and an employee of Lenox Realty. Respondent is not licensed to practice real estate and is not an employee of Lenox Realty.

3. In 1993, Respondent practiced real estate without a license by renting and negotiating the sale of a home owned by

   Herman and Mae Agnes Scott (the "Scotts"). Mr. Scott built the home himself approximately 20 years ago.

4. In November, 1993, Mr. Scott became fatally ill. The Scotts were unable to make the mortgage payments on their home. They were six months in arrears in their mortgage payments.

5. Crown Bank, the mortgagee, began foreclosure proceedings. The Scotts approached Respondent to assist them in avoiding foreclosure through a mortgage assistance program promoted by Lenox.

6. Respondent represented verbally, in the functions he performed, and in the capacity for which he signed relevant documents, that he was a licensed real estate agent. He and the Scotts met and discussed the pending foreclosure proceeding.

7. Respondent advised the Scotts that they should sell their house. Respondent represented that he would obtain a tenant who would purchase the house.

8. The Scotts were in a desperate financial situation and needed cash. Respondent loaned the Scotts $2,000. The loan included a personal loan of $1,250 to the Scotts and a $750 mortgage assistance fee for Respondent.

9. On November 10, 1993, the Scotts executed a management agreement with Lenox. Respondent negotiated and signed the management agreement.

10. The management agreement required Respondent to advertise and show the rental property, pre-qualify the tenant, negotiate the lease, and perform repairs and maintenance. The

    Scotts were to pay Respondent 12 percent of the gross rent, plus one month's rent, and $750 for a mortgage assistance program to avoid foreclosure. All of the rent earned on the property went to Respondent until the $1,250 loan and $750 mortgage assistance fee were paid.

11. On November 10, 1993, Respondent solicited and obtained an Exclusive Right of Sale Listing Contract from the Scotts on behalf of Lenox Realty. Respondent obtained a tenant who Respondent represented would purchase the Scotts' house.

12. Respondent collected $1,400 from the tenant. None of the rent was paid to avoid or work out the foreclosure. The mortgagee foreclosed on the Scotts' house. They lost their home, their equity, and their credit.

13. Respondent never worked for Lenox Realty. Lenox Realty never authorized Respondent to obtain listing agreements or management agreements on behalf of Lenox Realty.

14. Neither Lenox Realty nor Mr. Fess agreed to list the Scotts' home for sale. Neither authorized Respondent to do so. Mr. Fess never signed the listing agreement with the Scotts.

15. The Scotts dealt only with Respondent. They did not know that Respondent was not licensed. The Scotts never dealt with anyone who was a licensed real estate agent.

    CONCLUSIONS OF LAW

16. The Division of Administrative Hearings has jurisdiction over the subject matter and parties. The parties were duly noticed for the administrative hearing.

17. Petitioner has the burden of proof in this proceeding. Petitioner must show by clear and convincing evidence that

    Respondent committed the acts alleged in the Administrative Complaint and the reasonableness of any penalty to be imposed. Ferris v. Turlington, 510 So.2d 292 (Fla. 1987).

18. Petitioner satisfied its burden of proof. Petitioner showed by clear and convincing evidence that Respondent practiced real estate without a license in violation of Section 475.42(1)(a), Florida Statutes (1995) (hereinafter, Florida Statues).

19. Section 475.42(1)(a) provides, in relevant part:

    No person shall operate as a broker or salesperson without being the holder of a valid and current active license. . . .

20. Respondent operated as a real estate broker within the meaning of Section 475.01. Respondent operated as a broker within the meaning of Section 475.01.

21. Respondent's only explanation was that he typed the relevant documents at the instruction of his brother. He stated that he signed the documents by mistake.

22. The testimony of Respondent and his brother was neither credible nor persuasive. Respondent has made no attempt to provide restitution to Mrs. Scott.

23. Section 455.228, inter alia, authorizes Petitioner to impose an administrative penalty of not more than $5,000 for violations of Section 475.42(1)(a). The violations committed by Respondent were intentional and flagrant. They caused egregious harm to the Scotts. A maximum penalty is consistent with legislative intent expressed in Section 455.2281.

RECOMMENDATION

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

RECOMMENDED that Petitioner enter a Final Order finding Respondent guilty of violating Section 475.42(1)(a) and imposing an administrative penalty of $5,000.

RECOMMENDED this 28th day of April, 1997, in Tallahassee, Florida.

DANIEL MANRY

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(904) 488-9675 SUNCOM 278-9675

Fax Filing (904) 921-6847

Filed with the Clerk of the Division of Administrative Hearings this 28th day of April, 1997.

COPIES FURNISHED:

Henry M. Solares, Division Director Division of Real Estate

Department of Business and Professional Regulation

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

Lynda Goodgame General Counsel

Department of Business and Professional Regulation

Northwood Center

1940 North Monroe Street Tallahassee, Florida 32399-0792

Daniel Villazon, Esquire Department of Business and

Professional Regulation Division of Real Estate

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

Edward A. Kerben, Esquire 725 North Magnolia Avenue Orlando, Florida 32803

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.

Docket for Case No: 96-005606

Orders for Case No: 96-005606