STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF REVENUE,

Petitioner,

vs.

EXTREME PERFORMANCE & AUTO CENTER, INC.,

Respondent.

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) Case No. 11-4607

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RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on January 10, 2012, by video teleconference between West Palm Beach and Tallahassee, Florida, before Administrative Law Judge Claude B. Arrington of the Division of Administrative Hearings (DOAH).

APPEARANCES

For Petitioner: Carrol Y. Cherry, Esquire

Office of the Attorney General Revenue Litigation Bureau

The Capitol, Plaza Level 01 Tallahassee, Florida 32399

For Respondent: Michael L. Cohen, Esquire

Michael L. Cohen Law Offices 1803 South Australian Avenue West Palm Beach, Florida 33490

STATEMENT OF THE ISSUES

Whether Respondent committed the violations alleged in the "Administrative Complaint for Revocation of Certificate of

Registration" (Administrative Complaint) filed with DOAH on September 13, 2011, and, if so, the action that should be taken.

PRELIMINARY STATEMENT

The Department of Revenue (Petitioner) seeks to revoke the certificate of registration held by Extreme Performance and Auto Center, Inc. (Respondent) for failure to pay unemployment compensation taxes, sales and use taxes, and corporate income taxes in the amounts and for the periods set forth in the Findings of Fact section of this Recommended Order. In addition, Petitioner alleges that Respondent attempted to pay certain taxes with checks that were dishonored due to insufficient funds.

At the formal hearing, Petitioner offered six sequentially- lettered exhibits, each of which was admitted into evidence.

Petitioner presented no testimony. Respondent offered no witnesses and no exhibits.

No transcript has been filed. Petitioner timely filed its Proposed Recommended Order, which has been duly considered by the undersigned in the preparation of this Recommended Order.

Respondent did not file a proposed recommended order.

Unless otherwise noted, all statutory references are to Florida Statutes (2011). There has been no change to the statutes cited in this Recommended Order at any time relevant to this proceeding.

FINDINGS OF FACT

1. Petitioner is the agency of the State of Florida responsible for administering the revenue laws of the State of Florida, including the imposition and collection of the state's sales and use taxes pursuant to chapter 212, Florida Statutes, and the state's corporate income taxes pursuant to chapter 220. Petitioner provides unemployment compensation tax collection services under contract with the Agency for Workforce Innovation through an interagency agreement pursuant to section 443.1316.

2. Respondent is an active for-profit corporation with its principal address at 4401 Annette Street, West Palm Beach, Florida 33409.

3. Respondent is a "dealer" as that term is defined by section 212.06(2), and holds certificate of registration number 60-8014787127-3.

4. Respondent failed to timely file sale tax returns for the months of February and June 2011. Petitioner assessed Respondent an estimated tax liability of $2,000 for the months of February 2011 and June 2011.

5. Respondent filed returns but failed to timely remit payment for the sale and use tax in the amount of $24,529.84 due and owing for the months of June, September, and December 2008; March, June, September, and December 2009; January through December 2010; and January, April, and May 2011.

   
   

6. Due to its failure to timely file and/or remit taxes due, Respondent is liable for interest in the sum of $2,505.56, penalty in the sum of $2,526.36, and fees in the sum of

   $2,687.47, as of July 1, 2011.

   
   

7. Respondent is an employing unit as defined in subsection 443.036(2), and is subject to the unemployment compensation tax provisions of chapter 443, as provided in section 443.1215.

8. Respondent failed to timely file unemployment compensation tax reports for the calendar quarters ending

   June 30, September 30, and December 31, 2009; March 31, June 30,

   
   

   September 30, and December 31, 2010; and March 31 and June 30, 2011. As a result, Petitioner assessed Respondent an estimated unemployment compensation tax liability of $4,500.00 as of

   July 1, 2011.

   
   

9. Due to its failure to timely file the unemployment compensation tax reports, Respondent is liable for interest thereon in the sum of $490.06, penalty in the sum of $450.00, and fees in the sum of $443.31, as of July 1, 2011.

10. Respondent issued Petitioner worthless checks for the unemployment taxes due for the calendar quarters ending June 30, 2006; December 31, 2008; and March 31, 2009. As a result, Respondent still owes Petitioner unemployment compensation taxes

    
    

    in the sum of $425.34, interest in the sum of $119.09, and fees in the sum of $111.70.

11. Respondent is required to file with Petitioner corporate income tax returns each year pursuant to the provisions of chapter 220. Respondent failed to timely file corporate income tax returns and/or pay the tax due to Petitioner for the tax years 2008, 2009, and 2010.

12. Due to its failure to timely file corporate income tax returns and/or pay the tax due, Respondent is liable for penalties in the sum of $450.00 and fees in the sum $25.00, as of July 1, 2011.

13. Petitioner has issued and filed against Respondent delinquent tax warrants, notices of liens, or judgment lien certificates in the public records for the collection of delinquent sales and use tax, delinquent unemployment compensation tax, and delinquent corporate income tax.

14. Petitioner served upon Respondent a Notice of Conference on Revocation of Registration via mail on May 23, 2011, advising Respondent of a conference to be held June 22, 2011. No one appeared on behalf of Respondent at the conference scheduled on June 22.

    
    

    CONCLUSIONS OF LAW

    
    

15. DOAH has jurisdiction over the subject matter of and the parties to this proceeding pursuant to sections 120.569, 120.57(1), and 212.18, Florida Statutes.

16. Petitioner has the burden of proving by clear and convincing evidence the allegations against Respondent. See

    Ferris v. Turlington, 510 So. 2d 292 (Fla. 1987); Evans Packing Co. v. Dep't of Agric. & Consumer Servs., 550 So. 2d 112 (Fla. 1st DCA 1989); and Inquiry Concerning a Judge, 645 So. 2d 398 (Fla. 1994). The following statement has been repeatedly cited in discussions of the clear and convincing evidence standard:

    Clear and convincing evidence requires that the evidence must be found to be credible; the facts to which the witnesses testify must be distinctly remembered; the evidence 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 the firm belief of (sic) conviction, without hesitancy, as to the truth of the allegations sought to be established. Slomowitz v. Walker, 429 So.

    2d 797, 800 (Fla. 4th DCA 1983).

    
    

17. Section 212.06(2) defines the term "dealer." Respondent is a dealer within the meaning of that definition.

18. Section 212.15(1) requires that dealers collect and remit taxes imposed by chapter 212 on a monthly basis.

19. In accordance with section 212.15, the taxes imposed pursuant to chapter 212 become state funds at the moment of

    
    

    collection, and the intentional failure to remit those taxes constitutes a theft of state funds.

20. Pursuant to section 212.18(3)(b), except for circumstances inapplicable to this proceeding, "no person shall engage in business as a dealer . . . without first having obtained such a certificate or after such certificate has been cancelled "

21. Section 212.18(3)(d) provides as follows:

    
    

    (d) The department may revoke any dealer's certificate of registration when the dealer fails to comply with this chapter. Prior to revocation of a dealer's certificate of registration, the department must schedule an informal conference at which the dealer may present evidence regarding the department's intended revocation or enter into a compliance agreement with the department. The department must notify the dealer of its intended action and the time, place, and date of the scheduled informal conference by written notification sent by United States mail to the dealer's last known address of record furnished by the dealer on a form prescribed by the department. The dealer is required to attend the informal conference and present evidence refuting the department's intended revocation or enter into a compliance agreement with the department which resolves the dealer's failure to comply with this chapter. The department shall issue an administrative complaint under s. 120.60 if the dealer fails to attend the department's informal conference, fails to enter into a compliance agreement with the department resolving the dealer’s noncompliance with this chapter, or fails to comply with the executed compliance agreement.

    
    

22. Petitioner has complied with the foregoing procedures.

    
    

23. Petitioner established by clear and convincing evidence that Respondent has repeatedly failed to comply with the provisions of chapter 212.

24. Unemployment compensation tax contributions accrue and are payable by each employer for each calendar quarter the employer is subject to the provisions of chapter 443.

25. Pursuant to Florida Administrative Code Rule 60BB- 2.025, employers are required to file quarterly unemployment compensation tax reports that are due on or before the last day of the month following the calendar quarter to which the report applies. Such reports are required for each quarter, even if no contributions are payable.

26. Petitioner established by clear and convincing evidence that Respondent repeatedly failed to comply with the provisions of chapter 443.

27. Petitioner established by clear and convincing evidence that Respondent repeatedly failed to comply with the provisions of chapter 220 relating to the filing and payment of corporate income taxes.

28. In addition to the authority given to Petitioner to revoke Respondent's certificate of registration pursuant to section 212.18(3)(d), the provisions of section 213.692(1)(a)

    
    

    authorize Petitioner to revoke Respondent's certificate of registration and provide, in relevant part, as follows:

    1. If the department files a warrant, notice of lien, or judgment lien certificate against the property of a taxpayer, the department may also revoke all certificates of registration, permits, or licenses issued by the department to that taxpayer.

       
       

       1. Before the department my revoke the certificates of registration, permits, or licenses, the department must schedule an informal conference that the taxpayer is required to attend. At the conference the taxpayer may present evidence regarding the department's intended action or enter into a compliance agreement. The department must provide written notice to the taxpayer of the department's intended action and the time, date, and place of the conference.

          The department shall issue an administrative complaint to revoke the certificates of registration, permits, or licenses if the taxpayer does not attend the conference, enter into a compliance agreement, or comply with the compliance agreement.

          
          

29. Petitioner complied with the notice requirements contained in section 213.692(1)(a).

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order that revokes Respondent's certificate of registration.

DONE AND ENTERED this 31st day of January, 2012, in Tallahassee, Leon County, Florida.

S

CLAUDE B. ARRINGTON

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675

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

Filed with the Clerk of the Division of Administrative Hearings this 31st day of January, 2012.

COPIES FURNISHED:

Nancy Terrel, Acting General Counsel Department of Revenue

The Carlton Building, Room 204

501 South Calhoun Street Post Office Box 6668

Tallahassee, Florida 32314-6668

Lisa Vickers, Executive Director Department of Revenue

The Carlton Building, Room 104

501 South Calhoun Street Tallahassee, Florida 32399-0100

Joseph Mellichamp, Esquire Office of the Attorney General The Capitol, Plaza Level 01 Tallahassee, Florida 32399

Michael Lawrence Cohen, Esquire Michael L. Cohen Law Offices 1803 South Australian Avenue West Palm Beach, Florida 33409

Carrol Y. Cherry, Esquire Office of the Attorney General Revenue Litagation Bureau

The Capitol, Plaza Level 01 Tallahassee, Florida 32399

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: 11-004607

Orders for Case No: 11-004607