STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ANN L. BELL and A & B AUTO ) SALES OF JACKSONVILLE, INC., )

)

Petitioners, )

)

vs. ) Case No. 99-2507

)

DEPARTMENT OF HIGHWAY )

SAFETY AND MOTOR VEHICLES, )

)

Respondent. )

)

RECOMMENDED ORDER

Notice was provided and on September 28, 1999, a formal hearing was held in this case. Authority for conducting the hearing is set forth in Sections 120.569 and 120.57(1), Florida Statutes. The hearing location was the Jacksonville City Hall,

117 West Duval Street, Jacksonville, Florida. The hearing was conducted by Charles C. Adams, Administrative Law Judge.

APPEARANCES

For Petitioners: Edward P. Jackson, Esquire

Jackson & Mason, P.A.

516 West Adams Street Jacksonville, Florida 32202

For Respondent: Michael J. Alderman, Esquire

Department of Highway Safety and Motor Vehicles

Neil Kirkman Building, A-432 Tallahassee, Florida 32399-0500

STATEMENT OF THE ISSUE

Is Ann L. Bell (Ms. Bell) entitled to the issuance of a license to act as an independent motor vehicle dealer through A &

B Auto Sales of Jacksonville, Inc. (A & B), that license to be issued by the Department of Highway Safety and Motor Vehicles (the Department)? See Section 320.27, Florida Statutes.

PRELIMINARY STATEMENT

When Ms. Bell sought an independent motor vehicle dealer's license from the Department she was denied. The April 29, 1999 letter of denial referred to the performance of Amine Badreddine (Mr. Badreddine) who had previously held independent motor vehicle licenses issued by the Department and which were revoked. The letter of denial went on to refer to the Department's belief that Mr. Badreddine would become the de facto dealer in the application made by Ms. Bell. Given Mr. Badreddine's "poor performance" as a dealer in his own right, the Department denied Ms. Bell's license application based upon the belief that Mr.

Badreddine may have a "financial interest, active participation in the management, sales or any part in the operation of the dealership." In turn, Ms. Bell requested a formal administrative hearing to contest the denial. On June 4, 1999, the Division of Administrative Hearings received the Department's referral of the case. The undersigned was appointed to conduct the formal hearing. The hearing was held following one continuance.

At hearing Ms. Bell testified in support of the application for license. Petitioners' Exhibit Nos. 1-8 were admitted. The Department presented the testimony of Cindy King and Nadine Allain. Respondent's Exhibit Nos. 1-15 were admitted.

On October 18, 1999, a hearing transcript was filed with the Division of Administrative Hearings. The parties timely submitted Proposed Recommended Orders which have been considered in preparing the Recommended Order.

FINDINGS OF FACT

1. Ms. Bell made application to the Department for an independent motor vehicle dealer license. The name of the business would be A & B. The location of the business would be 7046 Atlantic Boulevard, Jacksonville, Florida.

2. In furtherance of the application Ms. Bell received a certificate of completion of the motor vehicle dealer training school conducted by the Florida Independent Automobile Dealers Association on January 26 and 27, 1999.

3. Ms. Bell submitted the necessary fees and other information required by the Department to complete the application for the license, to include the necessary surety bond.

4. At present Ms. Bell lives at 98 Kent Mill Pond Road, Alford, Florida, some distance from Jacksonville, Florida.

   Ms. Bell intends to move to Jacksonville, Florida, if she obtains the license.

5. Ms. Bell's work history includes a 35-year career with the State of Florida, Department of Insurance, from which she retired as a Deputy Insurance Commissioner. Her duties included supervision of employees and auditing. More recently Ms. Bell

   has worked as an insurance agent for approximately five years with Allstate Insurance. Ms. Bell also had 17 years' experience involving a business with her former husband in retail floor covering in which she dealt with sales staff and contracts.

   During another marriage, her then-husband was involved in the automobile business in Mobile, Alabama, as well as the Florida panhandle. Ms. Bell was not an employee of the automobile business conducted by her husband. Ms. Bell was "in and out" of the dealership and attended automobile auctions with her husband.

6. Ms. Bell intends to locate her dealership at the address where Mr. Badreddine formerly operated an independent motor vehicle dealership. Ms. Bell has known Mr. Badreddine for approximately 10 to 12 years. Ms. Bell has purchased cars from Mr. Badreddine. Ms. Bell has borrowed money from Mr. Badreddine. Mr. Badreddine has borrowed money from Ms. Bell.

7. Ms. Bell has a lease related to the location where she would operate her dealership.

8. At present Ms. Bell is using the prospective business location to collect on some accounts for automobiles purchased through Mr. Badreddine in which Ms. Bell has bought the accounts receivable from Mr. Badreddine. The arrangement concerning the accounts receivable is one in which Mr. Badreddine is expected to assist in the collection of monies owed on the accounts. The customers involved with those accounts are Arabs and African Americans. Mr. Badreddine is fluent in Arabic. The amount of

   money which Ms. Bell has invested is approximately $35,000, in relation to the purchase of the accounts receivable.

9. If Ms. Bell obtains the license she intends to employ Mr. Badreddine to sell automobiles at her lot and to be involved in the purchase of cars at automobile auctions. These duties would be in addition to the collection on the accounts receivable which Ms. Bell purchased from Mr. Badreddine. Ms. Bell does not intend to allow Mr. Badreddine access to the company bank accounts or the completion of the necessary paperwork when cars are sold to the public from her business.

10. In the past, Mr. Badreddine held independent motor vehicle dealer licenses issued by the Department. He lost those licenses based upon unacceptable performance under their terms. Ms. Bell is not unmindful of Mr. Badreddine's performance as a licensee, being informed by the Department in the details.

11. Mr. Badreddine held an independent motor vehicle dealer's license under the name A & D Wholesale, Inc. (A & D), for a business at 9944 Beach Boulevard, Jacksonville, Florida. The Department issued an administrative complaint against that license in Case No. DMV-94FY-566, concerning problems in cars sold by A & D in which the titles and registrations were not transferred appropriately and emissions tests were not performed appropriately. This case was disposed of through an informal hearing and a $5,000 administrative fine was imposed.

12. A further complaint was made against the licensee for the business A & D under an administrative complaint drawn by the Department in Case No. DMV-97FY-621. This complaint involved problems in title and registration transfer, failure to pay an existing lien on a trade-in, and the payment for automobiles obtained in automobile auctions upon which the drafts were not honored. No request for an administrative proceeding was received in relation to this administrative complaint. A final order was entered which revoked the independent motor vehicle dealer's license in relation to A & D.

13. Subsequently, Mr. Badreddine made an application for an independent motor vehicle dealer's license under the business name King Kar Auto Sales, Inc. (King Kar) for the address at which Ms. Bell would operate her business. The decision was made to grant Mr. Badreddine's request for an automobile dealer license for King Kar.

14. Following the grant of the license to King Kar an administrative complaint was brought in Case Nos. DMV-99FY-165 and DMV-99FY-166. The complaint involved the failure to pay off a lien, in which a check intended to settle the account with the lien holder was dishonored and falsification of the application in support of the license for King Kar. The final order disposing of these cases was premised upon the recognition that the license for King Kar had been revoked by virtue of the

    failure to maintain the necessary surety bond, rendering the allegations in the complaint moot.

15. In the conduct of his automobile business

    
    

    Mr. Badreddine was accused of obtaining property in return for a worthless check involved in dealings with GMAC Corporation. The check was in the amount of $16,671.38. This action was taken in the case of State of Florida vs. Amine Badreddine, in the Circuit Court of Duval County, Florida, Case No. 98-13690CFCR-E.

    Mr. Badreddine entered a plea of guilty to obtaining property in return for a worthless check and was placed upon probation for a period of one year, with a requirement to make restitution.

    Adjudication of guilt was withheld.

    
    

16. In a discussion between Ms. Bell and Cindy King, Department Compliance Examiner and Nadine Allain, Regional Administrator for the Department, Ms. Bell told the Department employees that Ms. Bell would need Mr. Badreddine to go to the automobile auctions and that "she didn't think it was lady-like to go to an auction." This is taken to mean that Ms. Bell did not believe she should go to the automobile auctions. Ms. Bell also told the Department employees that she needed Mr. Badreddine to sell automobiles for her, that he was a good salesman and that he was good at dealing with Arabs and she was not. Ms. Bell noted that she didn't live in the area where the dealership would be operated and referred to her purchase of the accounts receivable. Ms. Bell told the Department employees that

    Mr. Badreddine would be given an office in the back of the dealership or in the dealership. Ms. Bell told the Department employees that "she knew absolutely nothing about selling cars." Ms. Bell indicated that she would be relying upon Mr. Badreddine for advise in running her dealership. The reliance on

    Mr. Badreddine to deal with Arab clients was mentioned pertaining to the circumstances with the previous accounts receivable.

17. The Department offered to license Ms. Bell upon condition that Ms. Bell provide an affidavit to the effect that Mr. Badreddine would not be involved with her dealership. Ultimately, Ms. Bell did not accept this overture.

18. In denying the application for the independent motor vehicle dealer's license the Department gave the following reasons:

    1. Your admission of not knowing anything about the car business coupled with your stated intention to rely on the advice and experience of Mr. Amine Badreddine to operate your dealership means that Mr. Badreddine is, de facto, the dealer.

       
       

    2. Mr. Badreddine previously held independent motor vehicle dealer license number VI-15265, as A & D Wholesale, Inc. An administrative complaint was filed by the department against his dealership involving consumer complaints filed by Gladys L. Stevens, complaint number 93110148; Merrian

       A. Coe, complaint number 94010340; and Richard Green, complaint number 94030339. As a result of the administrative action,

       Mr. Badreddine's license was found in violation and fined $5,000.00 for failure to apply for transfer of title within 30 days, issuing more than two temporary tags to the same person for use on the same vehicle,

       violation of any other law of the state having to do with dealing in motor vehicles, failure to have a vehicle pass an emissions inspection within 90 days prior to retail sale and failure to transfer title.

       
       

    3. On December 23, 1996, a second administrative complaint was filed against A & D Wholesale, Inc. because of complaints

       received from Mark S. Smith, complaint number 96020168; Telmesa C. Porter, complaint number 96050435; Nijole Hall, complaint number 96070365; Ella Didenko, complaint number 96080083; Salih Ferozovic, complaint number 96100067; Charles R. Wells, complaint number 9610068; and Adessa Auto Auction, complaint number 96110372. As a result of this administrative action, a Final Order was issued on January 27, 1997 revoking

       Mr. Badreddine's independent motor vehicle dealers [sic] license for failure to apply for a transfer of title within 30 days, - failure to comply with the provisions of section 319.23(6), F.S., failure to have a vehicle pass an emission inspection prior to retail sale, issuance of more than two temporary tags to the same person for use on the same vehicle, failure to have a title or other indicia of ownership in possession of the dealership from the time of acquiring the vehicle until the time of disposing of the vehicle, failure of a motor vehicle dealer to honor a check or draft.

    4. Mr. Badreddine applied for and was issued another motor vehicle dealer's license on April 24, 1998, under the name King Kar Auto Sales, Inc. The license was revoked on October 20, 1998, because of a surety bond cancellation.

       
       

    5. On November 24, 1998, the department received a complaint from Treflyn N. Congraves, complaint number 98070299. Ms. Congraves filed a complaint with the state attorney which resulted in

       Mr. Bareddine [sic] being placed on probation for issuing a bad check to GMAC and ordered to pay restitution in the amount of

       $16,571.38. Mr. Badreddine is currently on

       probation. The department's investigation showed that Mr. Badreddine had a history of bad credit, failed to continually meet the requirements of the licensure law, failed to honor a bank draft or check given to a motor vehicle dealer for the purchase of a motor vehicle by another motor vehicle dealer, and had failed to satisfy a lien.

       
       

       Consequently, Mr. Badreddine's poor performance as a dealer forces us to deny a license where he may have a financial interest, active participation in the management, sales or any part in the operation of the dealership.

       
       

       CONCLUSIONS OF LAW

       
       

19. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this action in accordance with Sections 120.569 and 120.57(1), Florida Statutes.

20. Before engaging in business as a motor vehicle dealer Ms. Bell must obtain a license for A & B from the Department. See Section 320.27(2), Florida Statutes.

21. The Department intends to deny the application based upon Mr. Badreddine's unacceptable performance as an independent motor vehicle dealer, the assertion that Mr. Badreddine would be the de facto dealer in Ms. Bell's automobile dealership, and the alleged unacceptability of Mr. Badreddine's financial interests, active participation in management, sales, or any part of the operation of the dealership.

22. Section 320.27(9), Florida Statutes, sets forth specific grounds for the Department to deny an application for an

independent motor vehicle dealer's license. No one of those reasons is sufficient to deny Ms. Bell's application based upon Mr. Badreddine's prior history with the Department and the willingness of Ms. Bell to affiliate herself with Mr. Badreddine in her dealership. It would only be upon the occasion of

Mr. Badreddine's misconduct under those provisions after licensing that Ms. Bell would become accountable. The Department's argument in favor of the grounds for denial set forth in Section 320.27(9)(s), Florida Statutes, does not pertain in that Mr. Badreddine has never been, as the provision requires, convicted of a crime resulting in Mr. Badreddine's being prohibited from continuing as a motor vehicle dealer. This conclusion is reached even assuming that such offense would prohibit an applicant from affiliation with the offender in relation to financial matters, management, sales, or other roles in the operation of the dealership, or receipt of income from the dealership beyond compensation associated with the sale of the ownership interest in the business referred to in the statute.

RECOMMENDATION

Upon consideration of the Facts Found and the Conclusions of Law reached, it is

RECOMMENDED:

That a final order be entered which grants Ann L. Bell an independent motor vehicle dealer license for the business A & B.

DONE AND ENTERED this 17th day of November, 1999, in Tallahassee, Leon County, Florida.

CHARLES C. ADAMS

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 17th day of November, 1999.

COPIES FURNISHED:

Edward P. Jackson, Esquire Jackson & Mason, P.A.

516 West Adams Street Jacksonville, Florida 32202

Michael J. Alderman, Esquire Department of Highway Safety

and Motor Vehicles

Neil Kirkman Building, A-432 Tallahassee, Florida 32399-0500

Enoch Jon Whitney, General Counsel Department of Highway Safety

and Motor Vehicles Neil Kirkman Building

Tallahassee, Florida 32399-0500

Charles J. Brantley, Director Division of Motor Vehicles Department of Highway Safety

and Motor Vehicles

Neil Kirkman Building, Room B-439 Tallahassee, Florida 32399-0500

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: 99-002507

Orders for Case No: 99-002507