vs. )
Respondent. )
Case Nos. 04-3787
Pursuant to notice, a hearing was conducted in these cases on January 3, 2005, by video teleconference at sites in West Palm Beach and Tallahassee, Florida, before Stuart M. Lerner, a duly-designated Administrative Law Judge of the Division of Administrative Hearings (DOAH).
Whether Respondent committed the violations alleged in the Administrative Complaint issued against him and, if so, what disciplinary action should be taken against him.
On June 8, 2004, the Department of Health (Department) issued an Administrative Complaint against Respondent, a Florida-registered septic tank contractor, alleging the following:
On or about July 8, 2002, Respondent contracted with Pro Gold Inc., at 435 Blue Road, Coral Gables, Florida to install [a] septic tank and drainfield. A building permit was issued by Coral Gables at the end of January 2003.
This new installation was never done by Respondent. Further Respondent did not return the $2,300 obtained from Pro Gold Inc.
These actions constitute violations of Rule 64E-6.022(1)(g), FAC, abandoning[,] without good cause, a project in which the contractor is engaged or under . . . obligation to perform. First violation,
$500 fine; repeat violation, revocation.
The above facts are grounds upon which a
$500.00 fine must be made.
The homeowner was forced to hire a different contractor to do the job at considerable expense.
These actions constitute violations of Rule 64E-6.022[(1)]([l])(2), FAC, Misconduct which Causes Monetary or Other Harm to a Customer ($500 fine and 90 day suspension).
The above facts are grounds upon which a fine of $500 and 90 day suspension of the Certificate of Authorization, Septic Tank Contracting must be made.
On April 5, 2004, Respondent, through counsel, filed a letter with the Department, dated March 30, 2004, "requesting a formal hearing" on the allegations made in the Administrative Complaint. The Department's Agency Clerk, on April 6, 2004, responded to Respondent's request by advising that he "need[ed] more information from [Respondent] to start an administrative hearing for [Respondent]." Respondent's counsel, in turn, on behalf of Respondent, sent the following letter, dated April 21, 2004, to the Agency Clerk:
In connection with the above captioned matter, please be advised that I have reviewed your letter of April 6, 2004 and I thank you for your suggestions. My client is challenging the factual basis set forth in the complaint. There is a matter pending in the Eleventh Judicial Circuit regarding these same allegations. I have enclosed a copy of our affirmative defenses and the answer in said matter as well.
The main factual challenges consist of the following. First, my client did offer to refund monies to Mr. [de] Blank after costs for work performed were deducted, which refund the petition[er] never accepted.
Second, Mr. [de] Blank was not "forced" to obtain a different contractor, the petitioner chose a different contractor after he did not agree with the date my client offered to complete the job. In essence, Mr. [de] Blank wanted to force a certain date for performance which was not agreed to and failed to mitigate damages. As a matter of fact, we believe he acted in a certain way where he caused any damage to himself in this matter.
Please do not hesitate to contact me should you have any other questions.
On May 24, 2004, Respondent, through counsel, filed an Amended Petition for Administrative Hearing, in which he, among other things, made the following factual assertions:
[Respondent] never "abandoned" the alleged project.
Mr. [de] Blank was not "forced" to obtain a different contractor as he chose to have the work performed at a time when [Respondent] could not perform the work and the contract entered into between the parties did not state a date of performance.
Mr. [de] Blank failed to mitigate any alleged damages and interfered with the [Respondent's] compliance [with] the terms of the contract. Therefore, there was no "monetary harm" to the customer as alleged in the [Administrative Complaint]. As a matter of fact, the customer chose to complete the work with someone other than the [Respondent].
On June 9, 2004, the Department referred the matter to DOAH for the assignment of an Administrative Law Judge "to conduct a fact-finding hearing pursuant to Sec. 120.57(1), Florida Statutes, and to submit a Recommended Order to [the Department]." The DOAH Clerk docketed the case as DOAH Case No. 04-2024.
On June 30, 2004, the Department, inadvertently, referred to DOAH the identical matter it had previously referred on June 9, 2004, and a second, separate DOAH case file (DOAH Case No.
04-2281) was opened. At the request of the Department, DOAH Case Nos. 04-2024 and 04-2281 were consolidated by Order issued July 21, 2004.
On July 19, the parties filed a Joint Settlement Stipulation Requesting Closure of File[s] with Leave to Re-Open Case[s], which contained the following settlement terms:
The respondent shall make a total payment of $1,796.00 to Mr. Mauri[t]s [de] Blank in satisfaction of the Final Judgment entered pursuant to case no. 03-13813.
Said payment shall be made as follows: fifty percent ($898) within 7 days and the remaining fifty percent ($898) within 30 days of the first payment.
The payment shall be made to the Respondent's counsel and shall be forwarded to the Petitioner.
The parties have agreed that in exchange for said payments the Petitioner shall dismiss its action against respondent with prejudice, without further action.
The parties request closure of this matter with leave to re-open in the event that payment [is] not made in [f]ull by the Respondent.
By Order issued July 28, 2004, the files in DOAH Case Nos. 04-2024 and 04-2281 were closed, "with leave for either party to request [DOAH] to reopen the case[s], should the settlement not be executed."
On October 14, 2004, the Department requested that DOAH Case Nos. 04-2024 and 04-2281 be reopened. The request was
granted, and DOAH Case Nos. 04-2024 and 04-2281 were reopened as DOAH Case Nos. 04-3787 and 04-3788, respectively.
The final hearing in DOAH Case Nos. 04-3787 and 04-3788 was originally scheduled for December 6, 2004, but was continued at the Department's request and rescheduled for January 3, 2005.
As noted above, the hearing was held on January 3, 2005, as scheduled. At the outset of the hearing, the Department requested that DOAH Case Nos. 04-3787 and 04-3788 be merged into one case "under the lowest case number" (DOAH Case No. 04-3787). The request was granted.
Two witnesses, Maurits de Blank and Paul Andre, testified at the hearing. In addition to these two witnesses' testimony, seven exhibits (Petitioner's Exhibits 1 through 7) were offered and received into evidence.
Following the close of the evidence, but before the conclusion of the hearing, the undersigned, on the record, established a deadline (15 calendar days from the date of the filing of the hearing transcript with DOAH) for the filing of proposed recommended orders.
The hearing transcript (consisting of one volume) was filed with DOAH on January 19, 2005.
The Department filed its Proposed Recommended Order on January 21, 2005. To date, Respondent has not filed any post- hearing submittal.
Based on the evidence adduced at hearing, and the record as a whole, the following findings of fact are made:
Respondent is now, and has been at all times material to the instant matter, registered as a septic tank contractor with the Department.
In July 2002, Respondent entered into a contract with Pro Gold Investments Corp. (Pro Gold), whose president and sole owner is Emerico Kemeny Fuller. The contract provided that Respondent would install a "new septic system" for Pro Gold at
453 Blue Road in Coral Gables, Florida (Blue Road Property) for
$4,600.00, a job that should have taken only a "few days" to complete. Pro Gold gave Respondent a "job deposit" of
$2,300.00.
In July 2003, Pro Gold, by Warranty Deed, conveyed title to the Blue Road Property to Maurits de Blank's company, Mortgage Lending Company LLC (MLC), and it also executed a Bill of Sale, Absolute and Assignments of Contracts, which read as
follows:
PRO GOLD INVESTMENTS CORP, as Seller, in
consideration of Ten Dollars ($10.00) and other valuable consideration paid to it by MORTGAGE LENDING COMPANY, LLC, as Buyer, the
receipt of which is acknowledged hereby sells, assigns, grants, transfers, and conveys to Buyer all of Seller's right, title, and interest in the following
described goods, contracts and personal property:
SEE ATTACHED EXHIBIT "A- PROPERTY" AND EXHIBIT "B- CONTRACTS ASSIGNED"
Seller covenants and agrees that it is the lawful owner of goods, contracts, rights or interests transferred hereby; that they are free from all encumbrances, except for outstanding amounts due, if any, to those parties set forth on Exhibit "B," and that it has the right to sell, transfer and assign the goods, properties and rights set forth in the attached Exhibit "A," and the right to transfer and assign the contracts, rights or interests shown on Exhibit "B," and will warrant and defend same against the lawful claims and demands or all persons.
The "attached Exhibit 'A- Property'" read, in pertinent part, as follows:
(Regarding transfer of 453 Blue Road, Coral Gables, Florida, "the Real Property") (Mortgage currently in favor of Mortgage Lending Company, LLC "the Mortgage")
All property rights of any kind whatsoever, whether in property that is real, fixed, personal, mixed or otherwise and whether in property that is tangible or intangible, including, without limitation, all property rights in all property of any kind whatsoever that is owned or hereafter acquired by the Company and that is associated with, appurtenant to or used in the operation of the Real Property or is located on, at or upon the Real Property and is associated with or used in connection with or in operation of any business activity conducted on, at or upon the Real Property, and including, without limitation, the following:
* * *
All right, title, and interest in those certain contracts and agreements [set] forth in the attached Exhibit "B," which are hereby transferred and assigned to Mortgage Lending Company LLC.
Among the "contracts and agreements [set] forth in the attached Exhibit 'B,'" was the aforementioned July 2002, contract wherein Respondent agreed to install a "new septic system" for Pro Gold on the Blue Road Property (Septic System Contract). This contract was still executory. Respondent had not done any work on the site in the year that had passed since the contract had been signed.
In the beginning of August 2003, Mr. de Blank met with Respondent and advised him that MLC was the new owner of the Blue Road Property and that MLC had also received an assignment of the Septic System Contract from Pro Gold. In response to this advisement, Respondent stated "he did not do assignments."
Following this meeting, Mr. de Blank sent Respondent documentation supporting the assertions he had made regarding MLC's ownership of the Blue Road Property and its having been assigned the Septic System Contract. Mr. de Blank then attempted, unsuccessfully, to make contact with Respondent by telephone. He "left messages," but his telephone calls were not returned.
These efforts to telephonically communicate with Respondent having failed, Mr. de Blank "decided that it may make some sense to start a letter writing program." As part of that "program," on September 8, 2003, Mr. de Blank sent Respondent the following letter:
Re: 453 Blue Road, Coral Gables
As background, and in chronological order:
Pro Gold Investments purchased the above cited property and obtained a construction loan from our firm. One of the conditions was that all construction contracts would be assignable to our firm in the event of default.
Pro Gold Investments entered into contract with your firm to install a new septic tank and drainfield at 453 Blue Road.
Pro Gold Investments defaults and forfeits title in lieu of foreclosure. The deed was recorded on August 4, 2003, at Bk/Pg: 21484/4283.
Not recorded but attached for your reference is an assignment of contracts to include the contract Pro Gold Investments entered into with your firm.
See further attachment. The original can be inspected in my office.
At this point, I request you proceed with the work as soon as practical and under identical conditions as originally agreed with Pro Gold Investments.
Please call me at . . . to confirm a start date.
Mr. de Blank did not receive any response to his letter. He finally was able, however, to reach Respondent on the telephone. During this telephone conversation, Mr. de Blank made arrangements to meet Respondent at the Blue Road Property to discuss Respondent's doing the work Respondent had agreed to do in the Septic System Contract.
This meeting between Mr. de Blank and Respondent took place on September 11, 2003.
During the meeting, Mr. de Blank went over with Respondent "what the job [was] going to be." Although Respondent indicated that he was "going to put in th[e] septic tank" per the Septic System Contract, Mr. de Blank had his doubts that Respondent would be true to his word.
Following the meeting, Mr. de Blank sent Respondent the following letter:
Re: 453 Blue Road, Coral Gables
We met today to discuss the above referenced job. My understanding is:
You will start the job no later than the first week of October and will complete the job no later th[a]n the last week of October.
I will obtain a copy of the approved permit.
You indicated you will not need a survey.[1] Should you change you[r] mind, you can always refer to a survey I keep on site.
You will have your insurance agent mail to my address a certificate of insurance.
Though not discussed:
I would like a partial release of payments made to date for the job. See further the attachment. Assuming you concur, then please send a signed and notarized copy to Maurits de Blank, Mortgage Lending Company, Post Office Box 430336, Miami, Florida 33143. Note that I prefer for various legal reasons that you use the release form as provided.
Once the job has been started, I would like a list of firms supplying materials to the job.
Notwithstanding that he had promised Mr. de Blank that he would "start the job no later than the first week of October," by the middle of October Respondent had yet to even "pull a septic tank construction permit from the City of Coral Gables" (that was needed before any on-site work could begin).2 In an attempt to find out from Respondent what was the cause of the delay, Mr. de Blank started a "calling campaign," but Respondent neither answered the telephone when Mr. de Blank called nor returned Mr. de Blank's calls.
On October 19, 2003, Mr. de Blank sent the following letter to Respondent (by certified United States Mail, return receipt requested):
Re: 453 Blue Road, Coral Gables
I need a firm commitment when you will start and finish septic tank at above address.
If you cannot perform the work, then I will need a refund of the deposit given to your firm.
Please call to discuss.
The end of the month was fast approaching, and Respondent had neither contacted Mr. de Blank nor begun the Septic System Contract on-site work. After paying a visit to Coral Gables City Hall and learning that Respondent had still not even "pull[ed] a septic tank construction permit from the City of Coral Gables," Mr. De Blank found another septic tank contractor, Westland Septic Tank Corp., to do the installation work for MLC that Respondent was contractually obligated to perform.
MLC paid Westland $4,400.00 to do the work.
Westland completed the job some time prior to November 4, 2003.
The work passed all of the necessary inspections.
Upon learning that MLC had contracted with Westland, Respondent sent Mr. de Blank a letter complaining that Mr. de Blank had not given Respondent an adequate opportunity to meet his obligations under the Septic System Contract. In the letter, Respondent offered to return only $500.00 of the $2,300 down payment he had received from Pro Gold. Mr. de Blank
subsequently informed Respondent that this was not satisfactory and that he wanted the "full deposit back." He added that if he did not get it, he would "go to court."
Not having received any portion of the "deposit back," Mr. de Blank, acting on behalf of MLC, in mid-November 2003, filed suit against Respondent in Miami-Dade County Court.
On May 14, 2004, a Final Judgment was entered in Miami-Dade County Court Case No. 0313813 in favor of MLC and against Respondent "in the amount of $1,675.00 plus court costs in the amount of $121.00."
As of the date of the final hearing in this case, Respondent had not made any payments to MLC.
In view of the foregoing, it is found that Respondent abandoned for 30 consecutive days, without any apparent good cause, a project in which he was under contractual obligation to complete; and his failure to go forward with the project, combined with his failure to return any of the deposit he had received, caused monetary harm to a party to whom he was contractually obligated.
CONCLUSIONS OF LAW
DOAH has jurisdiction over the subject matter of this proceeding and of the parties hereto pursuant to Chapter 120, Florida Statutes.
Pursuant to Section 489.552, Florida Statutes, "[a] person shall not hold himself or herself out as a septic tank contractor . . . in this state unless he or she is registered by the [D]epartment in accordance with the provisions of [Chapter 489, Part III, Florida Statutes]."
Florida Administrative Code Rule 64E-6.022 sets forth the "[s]tandards of [p]ractice and [d]isciplinary [g]uidelines" the Department has established for persons registered with the Department as septic tank contractors. It provides, in pertinent part, as follows:
It shall be the responsibility of persons registered under this rule to see that work for which they have contracted and which has been performed by them or under their supervision is carried out in conformance with the requirements of all applicable Florida Statutes and Chapter 64E- 6, F.A.C. The following actions by a person included under this rule shall be deemed unethical and subject to penalties as set forth in this section. The penalties listed shall be used as guidelines in disciplinary cases, absent aggravating or mitigating circumstances and subject to other provisions of this section.
* * *
(g) Abandoning for 30 consecutive days, without good cause, a project in which the contractor is engaged or under contractual obligation to perform. First violation, letter of warning or fine up to $500; repeat violation, revocation.
* * *
(l) Gross negligence, incompetence, or misconduct which:
* * *
2. Causes monetary or other harm to a customer, or physical harm to any person. First violation, letter of warning or fine up to $500 and 90 day suspension; repeat violation, $500 fine and revocation.
* * *
Circumstances which shall be considered for the purposes of mitigation or aggravation of penalty shall include the following:
Monetary or other damage to the registrant's customer, in any way associated with the violation, which damage the registrant has not relieved, as of the time the penalty is to be assessed.
Actual job-site violations of this rule or conditions exhibiting gross negligence, incompetence or misconduct by the contractor, which have not been corrected as of the time the penalty is being assessed.
The severity of the offense.
The danger to the public.
The number of repetitions of the offense.
The number of complaints filed against the contractor.
The length of time the contractor has practiced and registration category.
The actual damage, physical or otherwise, to the customer.
The effect of the penalty upon the contractor's livelihood.
Any efforts at rehabilitation.
Any other mitigating or aggravating circumstances.
As used in this rule, a repeat violation is any violation on which disciplinary action is being taken where the same licensee had previously had disciplinary action taken against him or received a letter of warning in a prior case. This definition applies regardless of the chronological relationship of the violations and regardless of whether the violations are of the same or different subsections of this rule. The penalty given in the above list for repeat violations is intended to apply only to situations where the repeat violation is of a different subsection of this rule than the first violation. Where the repeat violation is the very same type of violation as the first violation, the penalty set out above will generally be increased over what is shown for repeat violations.
Where several of the above violations shall occur in one or several cases being considered together, the penalties shall normally be cumulative and consecutive.
The provisions of this section shall not be construed so as to prohibit civil action or criminal prosecution as provided in Part III of Chapter 489, F.S., and Section 381.0065, F.S., or for a violation of any provision of Part I of Chapter 386,
F.S. No provision of this section shall be construed as to limit the ability of the department to enter into binding stipulation with the accused party per subsection 120.57(4), F.S.
The Department may take disciplinary action against a registrant only after the registrant has been given reasonable written notice of the charges and an adequate opportunity to request a proceeding pursuant to Sections 120.569 and 120.57, Florida Statutes.
An evidentiary hearing must be held if requested by the registrant when there are disputed issues of material fact.
§§ 120.569(1) and 120.57(1), Fla. Stat.
At the hearing, the Department bears the burden of proving that the registrant engaged in the conduct, and thereby committed the violations, alleged in the charging instrument. Proof greater than a mere preponderance of the evidence must be presented by the Department to meet its burden of proof. Clear and convincing evidence of the registrant's guilt is required. See Department of Banking and Finance, Division of Securities and Investor Protection v. Osborne Stern and Company, 670 So. 2d 932, 935 (Fla. 1996); Ferris v. Turlington, 510 So. 2d 292, 294 (Fla. 1987); Pou v. Department of Insurance and Treasurer, 707 So. 2d 941 (Fla. 3d DCA 1998); and § 120.57(1)(j), Fla. Stat. ("Findings of fact shall be based upon a preponderance of the evidence, except in penal or licensure disciplinary proceedings or except as otherwise provided by statute ").
Clear and convincing evidence "requires more proof than a 'preponderance of the evidence' but less than 'beyond and
to the exclusion of a reasonable doubt.'" In re Graziano, 696 So. 2d 744, 753 (Fla. 1997). It is an "intermediate standard." Id. For proof to be considered "'clear and convincing' . . . the evidence must be found to be credible; the facts to which the witnesses testify must be distinctly remembered; the testimony must be precise and explicit and the witnesses must be lacking in confusion as to the facts in issue. The evidence must be of such weight that it produces in the mind of the trier of fact a firm belief or conviction, without hesitancy, as to the truth of the allegations sought to be established." In re
Davey, 645 So. 2d 398, 404 (Fla. 1994), quoting, with approval, from Slomowitz v. Walker, 429 So. 2d 797, 800 (Fla. 4th DCA 1983). "Although this standard of proof may be met where the evidence is in conflict, . . . it seems to preclude evidence that is ambiguous." Westinghouse Electric Corporation, Inc. v. Shuler Bros., Inc., 590 So. 2d 986, 989 (Fla. 1st DCA 1991).
In determining whether the Department has met its burden of proof, it is necessary to evaluate its evidentiary presentation in light of the specific allegations of wrongdoing made in the charging instrument. Due process prohibits an agency from taking penal action against a licensee or registrant based on matters not specifically alleged in the charging instrument, unless those matters have been tried by consent. See Shore Village Property Owners' Association, Inc. v.
Department of Environmental Protection, 824 So. 2d 208, 210 (Fla. 4th DCA 2002); Hamilton v. Department of Business and
Professional Regulation, 764 So. 2d 778 (Fla. 1st DCA 2000); Lusskin v. Agency for Health Care Administration, 731 So. 2d 67,
69 (Fla. 4th DCA 1999); Cottrill v. Department of Insurance, 685 So. 2d 1371, 1372 (Fla. 1st DCA 1996); and Delk v. Department of
Professional Regulation, 595 So. 2d 966, 967 (Fla. 5th DCA 1992).
The charging instrument in the instant case, the Administrative Complaint issued by the Department, alleges that Respondent violated Florida Administrative Code Rule 64E- 6.022(1)(g) and (1)(l)2 by abandoning, without good cause, the Blue Road Property septic system installation project he had agreed to undertake and by not returning the deposit he had received for the project.
The evidence the Department presented at the evidentiary hearing held in this case clearly and convincingly establishes that Respondent committed these rule violations.
In its Proposed Recommended Order, the Department suggests that Respondent be fined $500.00 for his violation of Florida Administrative Code Rule 64E-6.022(1)(g) and that he receive "an additional $500 fine and 90-day suspension for [his] violation of FAC Rule 64E-6.022(1)(l)2." This suggested disciplinary action, in the opinion of the undersigned, is
inappropriately harsh inasmuch as it provides for separate punishments for Respondent's violation of Florida Administrative Code Rule 64E-6.022(1)(g) and his violation of Florida Administrative Code Rule 64E-6.022(1)(l)2 notwithstanding that the former violation is a lesser included offense of the latter. Respondent should be punished only for the more serious of the two violations, his violation of Florida Administrative Code Rule 64E-6.022(1)(l)2. Examining the evidentiary record in the instant case in light of the disciplinary guidelines set forth in Florida Administrative Code Rule 64E-6.022, it appears that the penalty the Department has suggested Respondent should receive for violating Florida Administrative Code Rule 64E- 6.022(1)(l)2 ($500.00 fine plus a 90 day suspension) is within the Department's discretion to impose and is reasonable.
RECOMMENDED that the Department issue a final order finding Respondent guilty of the misconduct alleged in the Administrative Complaint and disciplining him therefor by fining him $500.00 and suspending his registration for 90 days.
DONE AND ENTERED this 4th day of February, 2005, in Tallahassee, Leon County, Florida.
STUART M. LERNER
Filed with the Clerk of the Division of Administrative Hearings this 4th day of February, 2005.
1 Respondent's complete lack of interest in reviewing the survey suggested to Mr. de Blank that, despite what Respondent had said at the meeting regarding his intentions, it was doubtful that Respondent intended to meet his obligations under the Septic System Contract.
2 A septic tank construction permit from the Department had already been obtained (in September 2002).
Anastasia M. Garcia, Esquire Garcia & Gurian, LLP
R. S. Power, Agency Clerk Department of Health
Timothy M. Cerio, General Counsel Department of Health
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.
