STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, DIVISION OF HOTELS AND RESTAURANTS,

Petitioner,

vs.

PALM HOTEL, MICHAEL DIFFLEY, AND JOXC INVESTMENTS, LLC,

Respondents.

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) Case No. 04-1360

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DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, DIVISION OF HOTELS AND RESTAURANTS,

Petitioner,

vs.

JOXC INVESTMENTS, LLC, d/b/a GRANTS ROOMING HOUSE,

Respondent.

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) Case No. 04-1749

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RECOMMENDED ORDER

Administrative Law Judge (ALJ) Daniel Manry conducted the administrative hearing in this proceeding on June 28, 2004, in Sarasota, Florida, on behalf of the Division of Administrative Hearings (DOAH).

APPEARANCES

For Petitioner: Charles F. Tunnicliff, Esquire

Department of Business and Professional Regulation

1940 North Monroe Street, Suite 60

Tallahassee, Florida 32399-2202

For Respondent: Michael Diffley, pro se

Palm Hotel

3409 Prudence Drive

Sarasota, Florida 34235 STATEMENT OF THE ISSUES

The issues in this case are whether each of two establishments is an unlicensed public lodging establishment, in violation of Subsection 509.241(1), Florida Statutes (2001), and, if so, whether the smoke detector and exit sign in one establishment were inoperable on October 31, 2003, and

January 5, 2004, in violation of Florida Administrative Code Rules 61C-1.004(5) and (10) and 61C-3.001(7).

PRELIMINARY STATEMENT

This procedural history is described more specifically in the Findings of Fact because some of the procedural facts are relevant to a defense alleging that the disciplinary action proposed against one establishment is time barred. In summary, Petitioner filed an Administrative Complaint against Respondent, Palm Hotel, on April 2, 2002, and filed an Administrative Complaint against Respondents, JOXC Investments, LLC, and Grants Rooming House, on February 6, 2004. Respondent, Michael

Diffley, timely requested an administrative hearing in each disciplinary proceeding. After Petitioner referred the two proceedings to DOAH to conduct the administrative hearings, the ALJ at the time consolidated the two proceedings.

At the hearing, Petitioner presented the testimony of one witness and submitted 11 exhibits for admission into evidence. Respondent, Michael Diffley, presented the testimony of one witness and submitted four exhibits for admission into evidence.

The identity of the witnesses and exhibits and the rulings regarding each are set forth in the one-volume Transcript of the hearing filed on July 14, 2004. The undersigned granted the parties' uncontested request to extend the time for filing proposed recommended orders (PROs) until August 2, 2004.

Petitioner timely filed its PRO on July 22, 2004. Respondents timely filed their PRO on August 2, 2004.

FINDINGS OF FACT

1. Petitioner is the state agency responsible for regulating and inspecting public food service establishments as defined in Subsection 509.013(5), Florida Statutes (2001).

   Mr. Michael Diffley (Diffley) is the managing owner of Respondent, JOXC Investments, LLC (JOXC). JOXC owns and operates the Palm Hotel (the Palm) and Grants Rooming House (Grants). The Palm and Grants are located, respectively,

   at 1425 8th Street and 2727 Washington Court, Sarasota, Florida 34235.

2. Petitioner inspected the Palm on September 4, 2001, and February 27, 2002. On April 2, 2002, Petitioner filed an Administrative Complaint against the Palm alleging that the Palm was an unlicensed public lodging establishment in violation of Subsection 509.241(1), Florida Statutes (2001).

3. Diffley requested an administrative hearing on April 23, 2002. Petitioner did not refer the request for hearing to DOAH until April 19, 2004. Diffley argues, in

   relevant part, that the failure to refer the matter to DOAH for more than two years bars the proposed disciplinary action. The Conclusions of Law address Diffley's defense.

4. Petitioner inspected Grants on September 17 and October 31, 2003, and on January 5, 2004. On February 6, 2004, Petitioner filed an Administrative Complaint against Grants and JOXC alleging that Grants was an unlicensed public lodging establishment, in violation of Subsection 509.241(1), Florida Statutes (2001), and that a smoke detector and exit sign in Grants were inoperable on October 31, 2003, and January 5, 2004, in violation of Florida Administrative Code Rules 61C-1.004(5) and (10) and 61C-3.001(7).

5. Diffley requested an administrative hearing on April 7, 2004. Petitioner referred the request for hearing to DOAH on

   May 18, 2004. Diffley does not oppose the second disciplinary action on the basis that the action is time barred.

6. DOAH originally assigned both disciplinary actions to ALJ William F. Quattlebaum. ALJ Quattlebaum granted Petitioner's motion to amend the Administrative Complaint against the Palm Hotel to name Diffley and JOXC as respondents and subsequently consolidated the two disciplinary actions.

7. The smoke detector and exit sign in Grants were inoperable on the dates alleged in the Administrative Complaint. Neither the Palm nor Grants was licensed as a public lodging establishment on the dates in issue. The remaining factual issue is whether either establishment was a public lodging establishment, defined in Subsection 509.013(4)(a), Florida Statutes (2001), that was required to be licensed pursuant to Subsection 509.241(1), Florida Statutes (2001).

8. The evidence was less than clear and convincing that JOXC rented to guests at either the Palm or Grants more than three times in a calendar year for periods of less than 30 days or one calendar month. JOXC rents rooms to guests pursuant to written residential leases for more than six months.

9. In practice, most guests at both establishments are transients and do not comply with their leases. The guests are low income earners or living on public assistance. Many have

   drug or alcohol problems. However, JOXC has been required to conduct formal eviction procedures against one former guest.

10. The evidence was clear and convincing that JOXC holds the Palm and Grants out to the public places that are regularly rented to guests within the meaning of Section 509.013, Florida Statutes (2001). The name of each establishment represents to the public that it is either a hotel or rooming house. With the exception of one formal eviction, JOXC has regularly operated each establishment as a hotel or rooming house. The occupational license from the City of Sarasota for each establishment authorizes each establishment to operate as a rooming house, motel, or hotel.

11. JOXC is the operator of each establishment within the meaning of Subsection 509.013(2), Florida Statutes (2001). Subsection 509.241(2), Florida Statutes (2001), requires JOXC to apply for and receive a license for each of the establishments. However, Subsection 509.241(2), Florida Statutes (2001), requires each establishment be a licensee. As the managing owner of JOXC, Diffley is a proper party to this proceeding, but is not subject to the requirements of Subsections 509.241(1) and (2), Florida Statutes (2001), as either a licensee or operator.

12. It is undisputed that Grants has no prior disciplinary violations. The Palm has prior disciplinary violations, but those violations are not for failure to maintain a license.

    CONCLUSIONS OF LAW

    
    

13. DOAH has jurisdiction over the subject matter and parties. §§ 120.569 and 120.57(1), Fla. Stat. (2003). The parties received adequate notice of the administrative hearing.

14. The disciplinary action concerning the Palm is not time barred. Petitioner cited no specific statute of limitations in Chapter 509, Florida Statutes (2001), that bars a disciplinary action against the Palm. The statute of limitations in Chapter 95, Florida Statutes (2001), does not apply to disciplinary actions. Ong v. Department of Professional Regulation, 565 So. 2d 1384, 1386 (Fla. 5th DCA 1990); Devine v. Department of Professional Regulation, 451 So. 2d 994 (Fla. 1st DCA 1984); Farzad v. Department of Professional Regulation, 443 So. 2d 373, 375 (Fla. 1st DCA 1983); Landes v. Department of Professional Regulation, 441 So. 2d 686 (Fla. 2d DCA 1983); Donaldson v. State Department of Health and Rehabilitative Services, 425 So. 2d 145 (Fla. 1st DCA 1983).

15. Petitioner has the burden of proof in this proceeding.

    
    

    Petitioner must show by clear and convincing evidence that each licensee committed the acts alleged in each Administrative Complaint and the reasonableness of any penalty to be imposed.

    Ferris v. Turlington, 510 So. 2d 292 (Fla. 1987). Petitioner satisfied its burden of proof.

16. Petitioner showed by clear and convincing evidence that the smoke detector and exit sign in Grants were inoperable on the relevant dates in violation of Florida Administrative Code Rule 61C-1.004(5), and that the Palm and Grants were unlicensed public lodging establishments at all times material to this proceeding. Courts have consistently affirmed findings in agency final orders that a place regularly held out as rented to the public is a public lodging establishment. Howard Hill,

    d/b/a Howard Hill Apartments v. State of Florida, Department of Business and Professional Regulation, Division of Hotels and Restaurants, 727 So. 2d 940, aff'd per curium, (Fla. 4th DCA 1998); Rolf Weimer, d/b/a Summit Villas Apartments v. State of

    Florida, Department of Business and Professional Regulation, Division of Hotels and Restaurants, 702 So. 2d 507, aff'd per curium, (Fla. 4th DCA 1997); Sherri Parker, d/b/a Cheyenne Villas v. State of Florida, Department of Business and

    Professional Regulation, Division of Hotels and Restaurants, 700 So. 2d 691, aff'd per curium, (Fla. 1st DCA 1998).

17. Section 409.261, Florida Statutes (2001), authorizes Petitioner to impose administrative fines for each violation in this consolidated proceeding and to require each establishment to comply with applicable licensing requirements. Petitioner

proposes a fine against the Palm in the amount of $1,000 and a fine against Grants in the amount $2,550. The proposed fines are reasonable under the facts and circumstances and the existing case law.

RECOMMENDATION

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

RECOMMENDED that Petitioner enter a final order finding the operator and each licensee guilty of committing the violations alleged in each Administrative Complaint; imposing severable fines of $1,000 and $2,550, against the Palm and Grants, respectively; requiring the operator and each establishment to forthwith obtain an appropriate license; and dismissing the charges against Diffley.

DONE AND ENTERED this 31st day of August, 2004, in Tallahassee, Leon County, Florida.

S

DANIEL MANRY

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 31st day of August, 2004.

COPIES FURNISHED:

Charles F. Tunnicliff, Esquire Department of Business and

Professional Regulation

1940 North Monroe Street, Suite 60

Tallahassee, Florida 32399-2202

Michael Diffley Palm Hotel

3409 Prudence Drive

Sarasota, Florida 34235

Leon Biegalski, General Counsel Department of Business and

Professional Regulation Northwood Centre

1940 North Monroe Street, Suite 60

Tallahassee, Florida 32399-2202

Geoff Luebkemann, Director Division of Hotels and Restaurants Department of Business and

Professional Regulation Northwood Centre

1940 North Monroe Street Tallahassee, Florida 32399-0792

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: 04-001749

Orders for Case No: 04-001749