The Issue The issues to be determined are whether Respondent violated sections 475.25(1)(e), 475.42(1)(b), and 475.42(1)(d), Florida Statutes (2011), and Florida Administrative Code Rule 61J2- 14.009, as alleged in the Administrative Complaint, and, if so, what penalty should be imposed?
Findings Of Fact The Department is the state agency charged with the licensing and regulation of the real estate industry in the state of Florida, pursuant to section 20.165 and chapters 455 and 475, Florida Statutes. At all times material to this proceeding, Respondent was a licensed real estate sales associate having been issued license number 3101946. During the time relevant to this case, Respondent was a sales associate affiliated with Bahia Real Estate ("Bahia"), a brokerage company owned by Raul and Ricardo Aleman, with offices located in Miami, Orlando, and Tampa, Florida. Respondent was employed in Bahia's Miami location. In 2010, Respondent acted as a sales associate on behalf of Michael Perricone for a real estate transaction involving the purchase of a condominium in the Blue Lagoon Towers ("Blue Lagoon") in Miami which was purchased as an investment. Mr. Perricone's sister, Francesca Palmeri, and her husband, Santo Palmeri, were present at the closing where they met Respondent for the first and only time. During the closing, which lasted approximately one hour, the Palmeris indicated to Respondent that they would be interested in making a similar purchase of investment property if another comparable condominium unit became available at Blue Lagoon. The Palmeris had no further interaction with Respondent until he contacted them at their home in Pueblo, Colorado, in 2011 to advise them of the availability of a condominium for sale at Blue Lagoon. On or about October 6, 2011, Respondent faxed a partially completed Bahia form "'AS IS' Residential Contract for Sale and Purchase" to Mrs. Palmeri for the Palmeris to use in making an offer on a condominium unit located at 5077 Northwest Seventh Street, Miami, Florida. Prior to forwarding the document to Mrs. Palmeri, Respondent wrote on the form the property description, the escrow agent name and address, the initial escrow deposit amount and additional deposit, the time for acceptance, the closing date, and listed himself as the "Cooperating Sales Associate" with "Bahia Realty Group, LLC." The Palmeris decided to offer a $125,000.00 purchase price. Respondent directed Mrs. Palmeri to complete the contract and provide a ten percent escrow deposit. Mrs. Palmeri entered a purchase price of $125,000.00, initialed each page, and signed the form as "Buyer." Respondent provided Mrs. Palmeri with instructions on how to wire the funds for the escrow deposit. On October 7, 2011, Mr. Palmeri wired $12,000.00 to J.P. Morgan Chase, which was then deposited in an account for Bonaventure Enterprises, LLC ("Bonaventure").1/ The Palmeris had no knowledge of Bonaventure, but, based upon the representations of Respondent, they understood the money they were asked to wire to the J.P. Morgan Chase account of Bonaventure was an escrow deposit for the property they intended to purchase at Blue Lagoon. The Palmeris had no discussion with Respondent regarding the reason for sending the escrow deposit to Bonaventure. They assumed that Bonaventure was somehow related to the seller or its title company. The condominium unit in question was bank owned; however, the Palmeris were not informed of this. No evidence was presented that Respondent had an ownership interest in Bonaventure. However, Bonaventure is owned by Respondent's brother and sister-in-law. At all times material hereto, Respondent was the managing member of Bonaventure. Bonaventure is not a licensed real estate broker. Bahia does not maintain an escrow account, and its sales associates are authorized to use title companies of their choice for receipt of escrow deposits. Respondent was aware that he was unable to accept the escrow deposit of the Palmeris in his own name, because, as a licensed real estate sales associate, he is prohibited from receiving the money associated with a real estate transaction in the name of anyone other than his broker or employer. In fact, Respondent was disciplined in 2010 for a similar violation.2/ Respondent claims that the Palmeris entrusted him with their $12,000.00 to hold for possible investments, not necessarily related to real estate transaction, and he was doing it as a favor for them as "friends." Respondent contradicted himself by stating his intention in directing the Palmeris to deposit their money into the Bonaventure account was to help them have cash on hand in Florida in order to meet the Blue Lagoon condominium seller's requirements to make the escrow deposit with the seller's title company within 24 hours after an offer was accepted. The Palmeris had no knowledge of the seller's unique restrictions on the escrow money. Further, Respondent's asserted motive in requesting the $12,000.00 to have cash on hand in Florida is undermined by the fact that, if the Palmeris could wire $12,000.00 to Bonaventure's bank account, they could also wire the funds directly to a title company chosen by the selling bank after acceptance of their offer. Shortly after returning the contract to Respondent and sending the escrow deposit, Mrs. Palmeri discussed increasing the purchase price by $1,000.00 for a total of $126,000.00. Based upon the language of the proposed contract, the Palmeris expected a response to their offer within 24 hours. Immediately thereafter, Respondent told the Palmeris that they were "in negotiations." However, almost a month passed before they heard from Respondent regarding the status of the purchase of the condominium. On or about November 4, 2011, Respondent contacted Mrs. Palmeri and stated that he had "good news." He indicated that the seller would be willing to sell the property for a price of $129,500.00. According to Respondent, the seller requested documentation from the Palmeris' bank indicating their ability to pay. Mrs. Palmeri indicated that this was not an acceptable counter-offer. Respondent suggested that he could negotiate a sales price of $129,000.00, but he needed the Palmeris to send an additional $9,000.00 to put into escrow. Mrs. Palmeri told Respondent that she was no longer interested in the property because their maximum offer was $126,000.00. During the same conversation, Mrs. Palmeri asked for the return of her deposit. Respondent expressed agitation that she was retreating from the possible purchase because he had done "so much work." Respondent clearly anticipated he would receive a commission if the deal was consummated. The Palmeris did not get an immediate return of their escrow deposit. Mrs. Palmeri called Respondent repeatedly and received no answer. She also sent an e-mail to J.P. Morgan Chase trying to find out the status of the deposit and received no reply. Mrs. Palmeri again attempted to contact Respondent on November 18, 2011, and left him a message that he needed to call her regarding the deposit. After receiving no response, she contacted Bahia and spoke with Ricardo Aleman. Mrs. Palmeri explained to Aleman that she had signed a real estate contract with Respondent on October 6, 2011. She no longer wanted to pursue this real estate transaction and wanted the escrow deposit returned. Aleman was unaware that Respondent was negotiating a real estate transaction for the Palmeris or had accepted their deposit money. Aleman contacted Respondent who confirmed by email that the Palmeris were no longer interested in purchasing the condominium at Blue Lagoon. Respondent wrote, "After a month of hard work . . . the client decided to drop. It was a little bit problematic. I lost time and money because the offer was already accepted and she had no reason to negotiate." Respondent assured Aleman he would return the deposit to the Palmeris. In accordance with Bahia's policies and procedures, its sales associates are required to complete a deposit form at the time of receipt of funds for escrow. No such receipt was received by Bahia from Respondent with regard to the transaction involving the Palmeris. However, it was not unusual for Bahia not to receive information regarding real estate transactions conducted by their sales associates until the time of closing. After discussing the matter with Aleman, Respondent advised the Palmeris that he could return their money within ten days. Respondent advised Mrs. Palmeri that he would send her two checks for the total amount--one check which she could cash immediately and a second check which would be postdated. In order to get a return of their deposit, Mrs. Palmeri agreed. On or about November 28, 2011, the Palmeris received two checks, each in the amount of $6,000.00, including one postdated for December 16, 2011. These checks were written on the account of Bonaventure and signed by Respondent.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Real Estate, enter a final order imposing on Alfonso Miranda an administrative fine in the amount of $6,000.00 and suspending the real estate sales associate license of Alfonso Miranda for a period of two years. DONE AND ENTERED this 2nd day of April, 2014, in Tallahassee, Leon County, Florida. S MARY LI CREASY 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 2nd day of April, 2014.
Recommendation Based upon the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that the Florida Real Estate Commission enter a final order holding Respondent, Stephen E. Schiller, t/a Allstate Realty, guilty of violating Section 475.25(1)(b) and (k), Florida Statutes (1985), under Counts I and II of the Administrative Complaint in this case, and suspending his real estate broker's license no. 0374362 for one year. DONE and ORDERED this 27th day of August, 1986 in Tallahassee, Florida. J. LAWRENCE JOHNSTON Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of August, 1986.
The Issue Whether or not the Respondent, Vista Realty, Inc., by and through its president, an active firm member, Respondent, Raymond S. Hurley, failed to maintain funds in its escrow or trust bank account until disbursement thereof is properly authorized; by receiving earnest money deposits from Edward Sheredy and Sharon Sheredy, his wife, and a separate earnest money deposit of Joseph Federico, both of which deposits were placed in the escrow bank account of Respondent, Vista Realty, Inc., and were allegedly unavailable for withdrawal from the escrow account at the time of any alleged real estate transaction closing in the two transactions, set for November 27, 1974, and by reason of the foregoing the Respondent, Vista Realty Inc., by and through its president, an active firm member, Respondent, Raymond S. Hurley, failed to maintain funds in an escrow or trust bank account until disbursement thereof was properly authorized, in violation of Subsection 475.25(1)(i), F.S. Whether or not Arthur Sinett and Sylvia Sinett, his wife, as purchasers, and Vista Community Builders, Inc. by and through its president, Raymond S. Hurley, as seller, and Vista Realty, Inc., by and through its president an active firm member, Raymond S. Hurley, as real estate broker, entered into a contract to purchase and sell certain real property in Palm Beach County, Florida which called for deposits by the buyer to be held in escrow account until the sale is closed; and whether or not the $50,000.00 sum placed with Vista Community Builders, Inc. was an earnest money deposit made pursuant to the terms of the contract; and whether or not Vista Community Builders, Inc. by and through its president, Respondent, Raymond S. Hurley, failed to deposit and maintain the said funds in an escrow account until the sale closed; thereby showing the Respondent, Raymond S. Hurley, to be guilty of misrepresentation, false promises, false pretenses, dishonest dealing, trick, scheme or device in a business transaction, in violation of Subsection 475.25(1)(a), F.S. Whether or not Richard J. Fenick and Agina J. Fennick, his wife, as purchasers, and Vista Community Builders, Inc. by and through its president, Raymond S. Hurley, as seller, and Vista Realty, Inc., by and through its president, as an active firm member, Raymond S. Hurley, as real estate broker, entered into a contract to purchase and sell certain real property in Palm Beach County, Florida which called for deposits by the buyer to be held in escrow account until the sale is closed; and whether or not the $10,000.00 sum placed with the Vista Community Builders, Inc. was an earnest money deposit made pursuant to the terms of the contract; and whether or not Vista Community Builders, Inc. by and through its president, Respondent, Raymond S. Hurley, failed to deposit and maintain the said funds in an escrow account until the sale closed; thereby showing the Respondent, Raymond S. Hurley, to be guilty of misrepresentation, false policies, false pretenses, dishonest dealing, trick, scheme or device in a business transaction, in violation of Subsection 475.25(1)(a), F.S.
Findings Of Fact The Respondent, Raymond S. Hurley, is the holder of license no. 0042412, held with the Florida Real Estate Commission, at all times pertinent to this administrative complaint. The Respondent, Vista Realty, Inc., is the holder of license no. 0091754, held with the Florida Real Estate Commission, at all times pertinent to this administrative complaint. The Respondent, Raymond S. Hurley, is now and was at all times alleged in the complaint, the President and active firm member of the Respondent, Vista Realty, Inc., a registered corporate broker. On or about November 8 & 26, 1973, Edward Sheredy and Sharon Sheredy, his wife, entrusted the sums of $100.00 and $3,050.00 respectively, to the Respondent, Vista Realty, Inc. as a real estate broker. A secretary of the Respondent corporation, one Marie Tolton, received the aforesaid sums, which represented an earnest money deposit on the purchase of real estate in Palm Beach County, Florida, by Edward Sheredy and Sharon Sheredy. On or about November 8 & 27, 1973, the Respondent, Vista Realty, Inc., by and through its President and active firm member, Respondent, Raymond S. Hurley, deposited the sums of $100.00 aid $3,050.00, respectively, into its escrow or trust bank account, to wit, the account of Vista Realty, Inc., escrow account with the American National Bank and Trust Company, Ft. Lauderdale, Florida. This deposit was made by an employee of the Respondent, Vista Realty, Inc., and was made to the account no. 2191-639-3. The balance in the escrow or bank account subsequent to the above deposits was $9,562.98, effective November 27, 1973. On or about February 19, 1974, Joseph Federico entrusted the sum of $5,637.50 to the Respondent, Vista Realty, Inc. as a real estate broker. The aforementioned sum represented part of an earnest money deposit of $5737.50 on the purchase of real estate in Palm Beach County, Florida, being made by Joseph Federico. The remainder of the earnest money deposit was made by voiding a prior real estate contract and transferring the $100.00 earnest money deposit therein to the new transaction. On or about March 1, 1974, the Respondent, Vista Realty, Inc., by and through its President and active firm member, Respondent, Raymond S. Hurley, deposited $5637.50 escrow money into its escrow or trust bank account, to wit, the account of Vista Realty, Inc. placed with the American National Bank and Trust Company, Ft. Lauderdale, Florida. This deposit of escrow was made by an employee of the Respondent, Vista Realty, Inc. into account no. 2191-63-3 after being received by the employee Marie Tolton, a secretary in the Respondent corporation. The balance in the escrow or trust bank account on March 4, 1974, which was present subsequent to the aforementioned deposit was $22,545.48. On November 27, 1974, the escrow bank account of the Respondent, Vista Realty, Inc. in the American National Bank and Trust Company, Ft. Lauderdale, Florida, reflected the balance of $4,700.48. On November 27, 1974, the aforementioned real estate transactions did not close, and any withdrawal of the earnest money deposit placed by the parties, Sheredy and Federico was not authorized to be made by the Respondents. The total obligation of the Respondents for the payment of the earnest money deposits for the Sheredy and Federico contracts, was $8,887.50. Other escrow funds which the Respondents had on deposit included $91.80 shown on account and $4,050.90 as a cashier's check on the same account, which was an escrow account with the First Community Bank of Boca Raton, Florida. The account no. in the Boca Raton bank was account no. 7145831. The amounts mentioned in the escrow account in the First Community Bank of Boca Raton were those amounts effective on November 27, 1974. Taking the totals of the escrow deposits in both banks, the total amount available on November 27, 1974, was $8,843.18, leaving a $44.32 deficit in honoring the refund of the Federico and Sheredy earnest money deposits. In addition, there was other real estate deposit in the Boca Raton bank, earnest money deposits on two contracts. Those amounts were $2,564.10 for Kathleen G. and Carl F. Monturo, and $2,500.00 for Hogeland Barcalow. Taking the total of the Monturo and Barcalow contracts this would an additional $5,064.10, debit against the available funds in two escrow accounts, which would be in addition to the $44.32 deficit already mentioned. The $5,064.10 could not have been used to satisfy the obligation on the Federico and Sheredy contracts. On or about August 30, 1974, Arthur Sinett and Silvia Sinett, his wife, as purchasers, went to the offices of Vista Realty, Inc. 2 North Federal Highway, Boca Raton, Florida, to enter into a contract to purchase real estate. The Respondent, Raymond S. Hurley was representing the corporation know as Vista Community Builders, Inc. and received $50,000.00 deposit as earnest money deposit on the purchase of the real estate in two separate installments, one of $45,000.00 and one of $5,000.00. The deposit receipt contracts signed was on a form prepared for Vista Realty, Inc. and listed Vista Realty, Inc. as real estate broker in the transaction. A copy of that is Petitioner's Exhibit number 5, admitted into evidence. The contract called for the $5600000 earnest money deposit to be placed in an escrow account until the sale was closed, and Raymond S. Hurley entered into this contract as President of Vista Community Builders, Inc. listing Vista Realty, Inc. as real estate broker. The money was never placed in an escrow account until closing, as stated in the contract, and this failure to place the money in an escrow account was without the permission of the Sinetts. On or about July 16, 1974, Richard J. Fenick and Aginia J. Fenick, his wife, entered into a contract for the purchase of real estate. This negotiation of the contract was entered into at the offices of Vista Realty, Inc. at 2 North Federal Highway, Boca Raton, Florida. Raymond S. Hurley signed, in his own name, as the party receiving the earnest money deposit, which was in the amount of $10,000.00. He signed as a contracting party in the name of Raymond S. Hurley, President, Vista Community Builders, Inc. The contract did not show the name of any broker, and in fact, indicated the word none in the space provided for such designation. The contract entered into between the Fenicks and Hurley is petitioner's Exhibit number 19, admitted into evidence. The contract form was a form prepared for Vista Realty, Inc., and contained a statement that deposits by the buyer should be placed in an escrow account until the sale was closed. The Fenicks paid the $10,000.00 to Raymond S. Hurley and the earnest money deposit was never placed in an escrow account, and the failure to place the earnest money deposit in an escrow account was without the permission of the Fenicks.
Recommendation It is recommended that the license no. 0042142, held by Raymond S. Hurley, be suspended for one year. It is recommended that the license no. 0091754, held by Vista Realty, Inc. be suspended for one year. DONE AND ENTERED this 28th day of February, 1977, in Tallahassee, Florida. CHARLES C. ADAMS, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Louis B. Guttmann, III, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789 Ronald Sales, Esquire Sales & Christiansen 247 Royal Palm Way Palm Beach, Florida 33480 ================================================================= AGENCY FINAL ORDER ================================================================= STATE OF FLORIDA DIVISION OF OCCUPATIONS DEPARTMENT OF PROFESSIONAL AND OCCUPATIONAL REGULATION FLORIDA REAL ESTATE COMMISSION FLORIDA REAL ESTATE COMMISSION, An Agency of the State of Florida, Plaintiff, PROGRESS DOCKET NO. 2759 PALM BEACH COUNTY vs. DOAH CASE NO. 76-0243 RAYMOND S. HURLEY and VISTA REALTY, INC., Defendants. /
The Issue Whether Respondent failed to preserve and maintain broker records in violation of Section 475.5015, Florida Statutes. Whether Respondent committed culpable negligence or breach of trust in any business transaction in violation of Subsection 475.25(1)(b), Florida Statutes.
Findings Of Fact Petitioner is a state licensing and regulatory agency charged with the duty to prosecute administrative complaints pursuant to the laws of the State of Florida, in particular, Section 20.30, Chapters 120, 455, and 475, and the rule promulgated thereto. Respondent is and was at all times material hereto a licensed real estate broker in the State of Florida, having been issued License No. 600642 in accordance with Chapter 475. The last license was issued to Respondent as a broker of Cascade Referral Service, Inc., 2439 Bee Ridge Road, Sarasota, Florida. At all times material, Respondent was the president and registered agent of Knightsbridge Park International (KPI), a corporation under the laws of Florida. At all times material, Respondent was the registered agent of an entity called Knightsbridge Vacation Homes (KVH). Between August 14, 1999, through May 21, 2001, Respondent was an active broker/officer of Knightsbridge Realty, Inc. (KRI). In the Fall of 1999, Sharon Malecki (Malecki), a resident of Wisconsin, met with Respondent's wife, Janet Wilkes, who was vice-president of KPI, to discuss engaging KPI's services in managing Malecki's property in Kissimmee, Florida. On or about February 14, 2000, as a result of this initial contact, Malecki entered into a contract with KPI to manage her property. Respondent signed the contract as president of KPI. The contract required Respondent and KPI to provide general management services to Malecki and to provide a monthly accounting showing all income and expenses for a period of one year commencing on March 1, 2000. The contract also required Malecki to keep a balance of $500 as a "management reserve balance." Respondent and KPI were required to deposit any amounts held in excess of the reserve amount in Malecki's bank account. Implicit in the monthly accounting requirement was that KPI and Respondent would collect the rental proceeds from Malecki's property and remit the proceeds to Malecki. At the same time the parties executed the contract, Malecki sent KPI a check for $500 to be kept in the escrow account for incidental maintenance and repairs of the property. Between August 10, 2000, and August 24, 2000, KPI placed a tenant by the name of "Plant" in Malecki's property and collected $1,214.29 in rent from the tenant. Between August 29, 2000, and September 12, 2000, KPI placed a tenant by the name of "Lusted" in Malecki's property and collected $1,309 in rental income funds from the tenant. The monthly accounting for August of 2000, purports to represent that KPI paid Malecki $616.42 toward the balance owed. Malecki never received this payment. Respondent failed to remit any of the above-referenced funds to Malecki. Respondent sent Malecki a letter dated November 7, 2000, in which he terminated the management contract and promised to send Malecki a final accounting "as soon as possible." On or about January 2, 2001, Respondent sent Malecki a letter, in which he acknowledged that there had been a "major accounting breakdown." In the letter, Respondent promised to make an interim payment within the next week. Subsequent to receipt of the two letters, Malecki made various attempts to obtain an accounting of the rental proceeds due. Respondent never remitted nor accounted for the funds. At all times material, Respondent failed to account for the $500 deposit he held for the benefit of Malecki. In June of 1999, a real estate broker by the name of John Young (Young) referred Isabel Benitez (Benitez) to Respondent after she bought a home through Young. On or about June 23, 1999, Benitez signed a contract with Respondent to manage her property located at 7981 Magnolia Bend Court, Kissimmee, Florida. The contract period was for one year and was renewed for an additional year in June of 2000. Although structured in the form of a lease, there was a clear understanding that KPI and Respondent were performing property management services and were obligated to pay a guaranteed amount to Benitez every month. The contract required Benitez to place a $500 deposit with Respondent and KPI as a "management deposit" to be used for incidental expenses associated with the management of the property. In approximately August of 2000, Benitez stopped receiving monthly payments from KPI. During the latter part of 2000, Benitez made various attempts to contact Respondent to determine the whereabouts of the monies due her. On or about December 14, 2000, Benitez sent Respondent a letter, in which she requested the monies due her under the contract. On or about December 15, 2000, Respondent faxed to Benitez a response to her letter, in which he accepts her termination of the contract and confesses that he had "not been involved in property management matters, let alone accounting aspects " On or about January 2, 2000, Respondent mailed to Benitez a letter informing her that there had been an "accounting breakdown," and promising to make an interim payment within a week. A review of an accounting provided to Benitez, dated February 9, 2001, indicates that Respondent owes Benitez funds in excess of $8,473. At all times material, Respondent has failed to remit the funds due or otherwise account for said funds. Around February of 2001, Thirza Neal (Neal), a resident of Washington, D.C., engaged the services of KRI to manage her property located at 114 Dornock Street, Davenport, Florida. Neal delivered a check for $1,000 to a Chris Turner (Turner), who was an agent of KRI, for the "start-up of utility costs." At some point, Neal decided not to engage the services of KRI, and on March 12, 2001, Neal sent an e-mail to Turner, in which she terminated the management contract and requested a return of her deposit. The above e-mail contains an indication that it was copied to the attention of Respondent. On or about March 26, 2001, Neal sent a certified letter to Respondent demanding a return of the deposit. On or about March 28, 2001, Neal received a letter from a gentleman by the name of B.C. Murphy, referencing her letter to Turner, denying that the check had been deposited into KRI's account and informing Neal that he had purchased KRI during the previous year. Eventually, Neal determined that the bank had inadvertently deposited the check into KVH's account. Neal made several attempts to contact Respondent personally and through his attorney and received no response. Neal was eventually able to obtain a reimbursement from the bank. Respondent neither provided assistance to Neal, nor did he remit the funds on his own accord. At some point later, Petitioner began an investigation and David Guerdan (Guerdan) was assigned to investigate the case. During the course of his investigation, Guerdan conducted interviews of the complaining witnesses and Respondent. On or about September 26, 2001, Guerdan conducted an interview of Respondent. During the course of the interview, Respondent was unable to address the specifics of the complaints. Respondent told Guerdan that he was not involved in the day-to-day operations of the business. He stated that his wife and son actually ran the business and that they had "poor accounting practices, overspent and ran out of the money." During the interview, Respondent could not be specific as to the amounts due each owner. Guerdan was unable to determine whether Respondent paid the funds due to each owner.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that The Florida Real Estate Commission issue a final order finding Respondent guilty of violating Subsections 475.25(1)(a) and (e) and Section 475.5015, as charged in the Administrative Complaint; and Impose a fine of $1,000 and suspend Respondent's license for a period of two years and require Respondent to make restitution to his former clients and complete a 45-hour salesperson's post-licensure course, as prescribed by the Florida Real Estate Commission. DONE AND ENTERED this 22nd day of August, 2003, in Tallahassee, Leon County, Florida. S DANIEL M. KILBRIDE 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 22nd day of August, 2003. COPIES FURNISHED: Christopher J. De Costa, Esquire Department of Business and Professional Regulation 400 West Robinson Street, Suite N801 Orlando, Florida 32801-1772 Brian John Wilkes 55 Pacific Close Southampton, England SO143TY Nancy P. Campiglia, Acting Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street Suite 802, North Orlando, Florida 32801 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202
Findings Of Fact Respondent, George G. Walsh, is a licensed real estate broker in the State of Florida, holding license number 0117943. Mr. Walsh is the owner of and the qualifying broker for G. G. Jerry Walsh Real Estate, located in Panama city, Florida. In May 1989, Respondent was the acting broker for Howard Bilford of Miami, Florida. Mr. Bilford owned a five acre parcel of property located in Bay County, Florida. Around May 15, 1989, Tama and Paul Russ, through Mr. Walsh's office, entered into a contract for the purchase of Mr. Bilford's property. The purchase price of the property was $15,000. The Russ' gave Mr. Walsh a $500 binder for deposit in his escrow account. The $500 was placed in Respondent's escrow account. Simultaneous with the signing of the sales contract and deposit receipt agreement, Mr. Walsh also prepared an estimated closing cost statement. On that closing cost statement, Mr. Walsh estimated that a survey of the property would cost the Russ' $450. During this meeting, Mr. Walsh explained to the Russ' that, especially if a financial institution was involved in the financing of the property, there would be certain costs which they would probably have to pay up front. Part of those costs included a survey of the property. At about the same time, the Russ' made application for a loan to a credit union located in Panama City, Florida. At the time of the loan application, the loan officers Mrs. Stokes, prepared a closing cost statement estimating the loan closing costs which the Russ' would encounter. On the credit union's closing cost statement, the cost of a survey was estimated to be $150 to $200. Since it was the credit union that required the survey, the Russ' believed that that estimate was the more accurate. The Russ' simply could not afford a $500 survey. As part of the loan application, an appraisal of the property was required. The appraisal was ordered by the credit union on May 16, 1989, and was completed on May 31, 1989. Unfortunately, the property had been vandalized by unknown persons, and the mobile home which was on the property had suffered severe and substantial damage. The appraisal indicated that the real estate was worth $10,500. With such a low appraisal, the credit union would not lend the amount necessary to purchase the property at the negotiated price. In an effort to renegotiate the property's price, Tama Russ inspected the property and prepared a list of the items which would have to be repaired to make the mobile home liveable. At the same time, the Russ' placed no trespassing signs and pulled logs across the entry to the property. The Russ' also placed padlocks on the doors to the mobile home and removed the accumulated garbage inside the mobile home in an effort to secure the property. They made no other repairs to the property. On June 1, 1990, the Russ' told the loan officer to hold the loan application. At some point during this process, both Mr. Walsh and the Russ' became aware that the survey would cost a considerable amount more than had been expected. By using a favor with Mr. Walsingham of County Wide Surveying, Mr. Walsh obtained a survey price of $500 for the Russ'. In an effort to help the Russ' close on the property, Mr. Walsh contacted Mr. Bilford to see if he would agree to pay the $500 survey cost. Mr. Bilford so agreed, contingent on the closure of the transaction, and sent Mr. Walsh a check made out to County Wide Surveying in the amount of $500. At that point, the Russ' believed that they were no longer obligated to pay for the survey since Mr. Walsh told them that Mr. Bilford was to pay for the survey. On June 3, 1989, Mr. Bilford agreed to a renegotiated price of $10,500.00 on the property. Additionally the Russ' agreed to sign a ten year promissory note for $2,000 bearing 11% interest per annum. Since there were changes in the terms of the contract, the Russ' entered into a net contract with Mr. Bilford on June 3, 1989. The new contract expired on June 30, 1989. Around June 5, 1989, the Russ' learned that their credit had been preliminarily approved. However, such preliminary approval only indicated that the Russ' had sufficient income to proceed with the more costly loan underwriting requirements of the credit union. Such preliminary approval did not indicate that the loan would be finally approved by the financial institution. The preliminary approval was communicated to Mr. Walsh by Tama Russ. Ms. Russ intended the communication to mean that they had been preliminarily approved by the financial institution. Mr. Walsh in an abundance caution contacted Mrs. Stokes, the loan officer. Mrs. Stokes advised him that the Russ' credit had been preliminarily approved. She did not tell him that the loan had been finally approved. Through a misunderstanding of what Mrs. Stokes communicated to him, Mr. Walsh ordered the survey from County Wide Realty on June 7, 1989. There was no reliable evidence presented that the credit union had authorized him to order the survey. The credit union at no time during this process ordered the survey. Mr. Walsh testified that Ms. Russ told him to order the survey. Ms. Russ denies that she gave Mr. Walsh permission to order the survey. At best this evidence goes only to demonstrate Respondent's intent with regards to the actions he undertook in this case and removes this case from a Section 475.25(1)(b), Florida Statutes, violation. At some point Ms. Stokes left the employ of the credit union. On June 16, 1989, as part of her leaving, she unilaterally closed the Russ' loan application file and cancelled the loan application. Neither the Russ' nor Mr. Walsh were notified of the closure or the cancellation. The credit union's file fell into the void created between a change of employees. Because Mr. Walsh was unaware of Ms. Stokes' actions, Mr. Walsh, on July 13, 1989, after the expiration of the Russ' sales contract, contacted the credit union in order to obtain the loan closing package from the institution. The credit union had to hunt for the Russ' file. The credit union president called the Russ' about the loan and he was advised that they did not want the loan. The credit union's president then reviewed the loan file and noted that the Russ' had insufficient income to come up with the amount of the promissory note. He also thought the real estate constituted insufficient collateral for the loan. The loan application was officially denied on July 15, 1989. The Russ' were notified of the credit union's denial credit. The real estate transaction never closed. However, sometime after July 15, 1989, Mr. Walsh received the survey from County Wide. The survey indicates that the field work for the survey was completed on July 17, 1989, and that it was drawn on July 18, 1989. 1/ There was no reliable evidence which indicated any attempt had been made to cancel the survey. Sometime, after July 15, 1989, Tama Russ contacted Mr. Walsh in order to obtain the return of their $500 deposit. After many failed attempts to get the Russ' to voluntarily agree to pay for the cost of the survey, Mr. Walsh, around October, 1989, unilaterally paid the Russ' deposit to County Wide Realty. Mr. Walsh followed this course of action after speaking with some local FREC members who advised him that since FREC was swamped with deposit disputes that nothing would happen as long as he used his best judgment. The payment of the deposit to the surveyor, without prior authorization from the Ruse' violates Section 475.25(1)(d) and (k) Florida Statutes.
Recommendation Based on the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, the pleadings and argument of the parties, it is therefore, RECOMMENDED that the Florida Real Estate Commission enter a Final Order finding Respondent guilty of violating Sections 475.25(1)(d) and 475.25(1)(k), Florida Statutes, issuing a letter of reprimand to Respondent with instructions to immediately replace the Russ' trust deposit and forthwith submit the matter to the commission for an escrow disbursement order and levying a $250 fine. IT IS FURTHER RECOMMENDED that the portions of the Administrative Complaint alleging violation of Section 475.25(1)(b) be dismissed. DONE and ENTERED this 29th day of January, 1991, in Tallahassee, Florida. DIANE CLEAVINGER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 29th day of January, 1991.
The Issue The issue for determination is whether Respondent committed the offenses set forth in the Administrative Complaint and, if so, what action should be taken.
Findings Of Fact The Division of Real Estate is a licensing and regulatory agency of the State of Florida. The Division of Real Estate is charged with the responsibility and duty to prosecute administrative complaints pursuant to the laws of Florida, in particular Section 20.165 and Chapters 120, 455, and 475, Florida Statutes, and the rules promulgated pursuant thereto. At all times material hereto, Ms. Bell was a licensed Florida real estate broker, having been issued license number 349586 in accordance with Chapter 475, Florida Statutes. Her last license issued was as an active broker with Sharmic Realty at 4385 Rock Island Road, Lauderhill, Florida 33319. At all times material hereto, Sharmic Realty was a corporation registered as a Florida real estate broker, having been issued license number 1010817 in accordance with Chapter 475, Florida Statutes. Its last license issued was at the address of 4385 Rock Island Road, Lauderhill, Florida 33319. At all times material hereto, Ms. Bell was licensed and operating as the qualifying broker and officer of Sharmic Realty. On or about June 27, 2000, Ms. Bell and Sharmic Realty facilitated a real estate transaction for the purchase of property referred to as 4158 West Inverrary Boulevard, Fort Lauderdale, Florida 33319, hereinafter Real Estate. The realty company listing the Real Estate for the Seller was Century 21, Tenace Realty, Inc., hereinafter Tenace Realty. The Deposit Receipt and Contract for Sale and Purchase, hereinafter Contract One, for the Real Estate was executed by the Buyer on June 15, 2000, and by the Sellers on June 27, 2000. Contract One provided, among other things, that the Buyer was to make an initial deposit of $500 upon execution of Contract One and $2,500 within five banking days; that Sharmic Realty was the entity to hold the deposits; that all parties were required to execute Contract One by 5:00 p.m., June 16, 2000, and, if not, the offer to purchase was withdrawn and all deposits would be returned to the Buyer; and that the closing date was on or before July 30, 2000. Furthermore, Contract One provided, among other things, that the Seller agreed to pay six percent of the purchase price towards the Buyer's closing costs. Sharmic Realty was identified as the selling broker and the escrow agent in Contract One. The Buyer paid a total of $2,500 to Sharmic Realty as a deposit on the Real Estate. By check dated March 13, 2000, the Buyer made a deposit of $500 to Sharmic Realty. By cashier's check dated July 3, 2000, another deposit of $2,000 was made to Sharmic Realty. On July 3, 2000, Tenace Realty faxed to Ms. Bell and Sharmic Realty the signature pages, executed by the Sellers, of Contract One. The effective date of Contract One was specified as the date that all parties executed Contract One. The effective date of Contract One was July 3, 2000, when the executed signature pages were faxed to Ms. Bell and Sharmic Realty. No evidence was presented that the Buyer and Seller agreed that the dates for the deposits and the execution of Contract One were waived or extended. However, based upon the conduct of both the Buyer and Seller as to the time of making the final deposit and executing Contract One, an inference is drawn and a finding of fact is made that the time periods for the deposits and execution of Contract One were waived or extended by the Buyer and Seller. Contract One contained a pre-qualification provision. The provision provided that, within five banking days of the effective date, the Buyer must provide to the Seller a letter from a lender that the Buyer has pre-qualified for a mortgage loan. Furthermore, the provision provided that the failure of the Buyer to provide this letter gives the Seller the right to terminate Contract One by written notice to the Buyer or the Buyer's representative and all deposits to be returned to the Buyer. Contract One contained a default provision. The provision provided, among other things, that, if the Buyer failed to performed any of the "covenants" of Contract One, all deposits paid by the Buyer shall be liquidated damages and in full settlement to the Seller. As to the Seller, the provision provided, among other things, that, if the Seller failed to perform any of the "covenants" of Contract One, all deposits paid by the Buyer would be returned to the Buyer upon demand or the Buyer would have the right of specific performance. By letter dated July 11, 2000, the manager of Tenace Realty, Ellen Tremper, as the agent of the Seller, made a demand for all deposits paid by the Buyer. Ms. Tremper indicated, among other things, in her letter that Tenace Realty had not been informed by Ms. Bell and Sharmic Realty whether the Buyer had paid the $2,000 deposit to Sharmic Realty even though Tenace Realty had made several attempts to obtain this information from them; and that the Buyer was in default for not submitting an application to the condominium association. In her letter, Ms. Tremper requested that either Sharmic Realty obtain an "Escrow Disbursement Order" from the Division of Real Estate or submit the total deposit to it (Tenace Realty). Subsequently, by letter dated July 13, 2000, the president of Tenace Realty notified Sharmic Realty that the Sellers believed that the Buyer was in default of Contract One and requested the "$2500 on deposit" in Sharmic's escrow account. It is clear from the letter dated July 13, 2000, that Tenace Realty had knowledge that Sharmic Realty had received from the Buyer the deposit in-full. The closing on Contract One did not take place. The Sellers decided that they no longer wanted to pay any of the closing costs, as provided in Contract One. The Buyer's position remained the same, she did not want to pay all of the closing costs. Neither the Sellers nor the Buyer could come to an agreement on the closing costs. Further, Tenace Realty considered Contract One to be "null and void" because Tenace Realty had not received a loan commitment for the Buyer and because the closing date had passed and no closing had taken place. No evidence was presented to demonstrate that Tenace Realty communicated this position to Ms. Bell and Sharmic Realty. Ms. Bell considered the Sellers to be in default of Contract One because the Sellers sought to change the terms of Contract One by refusing to pay anything towards the closing costs, which was contrary to the terms of Contract One. No evidence was presented to demonstrate that Ms. Bell communicated this position to Tenace Realty. In spite of her position, Ms. Bell and Sharmic Realty continued to attempt to salvage the purchase of the Real Estate. On or about August 8, 2000, Ms. Bell and Sharmic Realty forwarded the purchase of the property to a closing company, Consolidated Title Company. By letter dated August 8, 2000, Consolidated Title Company contacted the Sellers regarding the closing, including information and documents needed from the Sellers for the closing. The time period for Tenace Realty to be the listing agent for the Sellers expired. The listing was subsequently placed with another realty company, Advance Realty. Ms. Bell and Sharmic Realty made an offer, on behalf of the Buyer, to Advance Realty to purchase the Real Estate. A proposed contract, Contract Two, was executed by the Buyer on August 22, 2000 and faxed to Advance Realty. Contract Two had primarily the same provisions, except, pertinent hereto, the offered purchase price was more than the listing price, the deposit was $500, the date of the acceptance by the Sellers was August 25, 2000, and the closing date was on or before September 15, 2000. Furthermore, the Buyer had obtained a mortgage loan commitment dated August 23, 2000. The purchase of the Real Estate under Contract Two did not occur. Ms. Bell returned to the Buyer the Buyer's deposit. Ms. Bell issued a check to the Buyer, dated November 13, 2000, from Sharmic Realty's escrow account in the amount of $2,500. Ms. Bell did not return the Buyer's deposit to the Buyer immediately because the Buyer continued to search for property to purchase and because the Buyer did not request the return of the deposit. After the return of the deposit to the Buyer, by letter dated January 4, 2001, counsel for the Sellers made a demand for the $2,500 deposit as liquidated damages for the failure of the Buyer to close on the Real Estate. The letter fails to indicate what was the closing date, so the undersigned is unable to determine whether the letter refers to the closing date under Contract One or Contract Two. Two addresses for Sharmic Realty were on the letter dated January 4, 2001. At that time, neither address was correct. No evidence was presented as to whether the letter was forwarded to Sharmic Realty's correct address. The Sellers filed a complaint against Ms. Bell and Sharmic Realty with the Division of Real Estate. On or about January 22, 2001, an investigation was begun by an investigator for the Division of Real Estate. Ms. Bell and Sharmic Realty were notified about the investigation on or about the same date. Ms. Bell believed it was too late to notify the Division of Real Estate that a dispute regarding escrow funds existed since the Division of Real Estate was now performing an investigation and since the Division of Real Estate was now aware of the dispute. Ms. Bell and Sharmic Realty were aware sometime in January 2001 that the Sellers were making a demand on the Buyer's deposit. The evidence fails to demonstrate whether Ms. Bell and Sharmic Realty became aware of the demand before being notified by the Division of Real Estate about the investigation. By letter dated March 1, 2001, counsel for the Sellers notified the investigator for the Division of Real Estate, among other things, that a demand letter, dated January 4, 2001, had been sent to Sharmic Realty and included a copy to the investigator. Furthermore, the Sellers' counsel advised the investigator that, at the investigator's request, the law firm had requested from Tenace Realty, on two separate occasions, copies of the demand letters that Tenace Realty informed the Sellers that it had sent to Sharmic Realty and provided the Sellers with copies, but the Seller's counsel had not received copies of the demand letters from Tenace Realty. The investigator for the Division of Real Estate obtained Tenace Realty's demand letters from the Sellers, not from Tenace Realty. The investigator never visited Tenace Realty to interview its employees and/or to review its files and obtain documents; he only interviewed Tenace Realty's employees over the telephone. Regarding the demand letters from Tenace Realty, neither Ms. Tremper nor Tenace Realty's agent working with the Sellers, Melinda Vernon, could testify that the demand letters were actually mailed. However, they could testify that Tenace Realty's practice was to place letters that were returned in the return letter file and that, because the letters were not in Tenace Realty's return letter file, the demand letters were sent to Sharmic Realty. However, Ms. Bell and Sharmic Realty deny ever receiving the demand letters. Sharmic Realty's former employee, Khari Scott, at the time, was responsible for, among other things, opening and distributing the mail. He is also the nephew of Ms. Bell. Mr. Scott testified that, whenever a demand letter was received, Sharmic Realty's practice was for him to date-stamp the demand letter when it was received; to bring the demand letter to Ms. Bell's attention, without delay; to meet with Ms. Bell and discuss how she wanted him to handle the demand letter in terms of preparing a letter for her signature, to whom it was to be sent and whether to send a deposit check; to place the demand letter in the file of the real estate transaction; and to place a copy of the demand letter in the file for demand letters. Tenace Realty's demand letters were neither in the file of the real estate transaction nor in the file for demand letters, and Mr. Scott testified that, therefore, no demand letters were received from Tenace Realty. Ms. Bell testified that she never received the demand letters from Tenace Realty. She further testified that, if she had received the demand letters, she would have contacted the Division of Real Estate, informed it that a dispute existed about escrow monies and would wait for it to resolve the dispute. As to the receipt of the demand letters from Tenace Realty by Sharmic Realty, the undersigned finds the testimony of Ms. Trempler, Ms. Vernon, and Mr. Scott suspect. However, the undersigned finds the testimony of Ms. Trempler and Ms. Vernon less credible, particularly taking into consideration that the Sellers' counsel was unable to obtain a copy of the demand letters from Tenace Realty and that Tenace Realty was the Sellers' agent. As a result, considering the proof required, the undersigned cannot make a finding of fact that Ms. Bell and Sharmic Realty received the demand letters from Tenace Realty. Further, sometime around the date set in Contract One for the closing, which, the evidence demonstrates, could have been just before or after the designated closing date, Ms. Vernon and the Sellers went to Sharmic Realty. Ms. Vernon testified that she and the Sellers went to Sharmic Realty to demand the deposit paid by the Buyer, but that they were not allowed by Sharmic Realty's employees to talk with Ms. Bell; whereas, Ms. Bell testified that her employees did not refuse to allow Ms. Vernon and the Sellers to talk with her. Ms. Bell also testified that she did talk with Ms. Vernon, that the discussion was about the Sellers obtaining their key to the Real Estate from Ms. Bell, and that nothing was said about a demand for the deposit paid by the Buyer. Again, both the testimony of Ms. Vernon and Ms. Bell are suspect. Considering that the undersigned cannot make a finding of fact that Ms. Bell and Sharmic Realty received the demand letters from Tenace Realty and considering the proof required, the undersigned cannot make a finding of fact that Ms. Bell was avoiding Ms. Vernon in order not to address the demand for the Buyer's deposit. Furthermore, regarding the demand for the Buyer's deposit from Tenace Realty, the undersigned cannot make a finding of fact that Ms. Bell and Sharmic Realty had knowledge that a demand for the Buyer's deposit was made by the Sellers. As to the demand letter from the Sellers counsel, dated January 4, 2001, at the time of the letter, the addresses on the demand letter were no longer the addresses for Sharmic Realty and had not been for several years. A finding of fact is made that neither Ms. Bell nor Sharmic Realty received the demand letter. Further, Ms. Bell and Sharmic Realty had already returned the Buyer's deposit to the Buyer at the time of the demand letter from the Sellers' counsel. Prior disciplinary action was taken against Ms. Bell and Sharmic Realty by the Florida Real Estate Commission (FREC). The FREC filed a Final Order on May 17, 1996, reprimanding Sharmic Realty, imposing an administrative fine of $3,000 upon Ms. Bell, suspending Ms. Bell's license for six months, and placing Ms. Bell on probation for one year, with certain conditions imposed--for violating Section 475.25(1)(b), Florida Statutes, by reason of culpable negligence; Section 474.25(1)(e), Florida Statutes, and Florida Administrative Code Rule 61J2-14.008(1)(c), by depositing substantial amounts of personal funds in their Property Management Escrow Account; and Section 475.25(1)(e), Florida Statutes, and Florida Administrative Code Rule 61J2-14.012(4), by failing to keep the books, accounts, and records required by law.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Real Estate Agency enter a final order: Finding Hilda Bell and Sharmic Realty Properties, Inc. did not commit the violations alleged in Counts I through VI of the Administrative Complaint. Dismissing the Administrative Complaint filed against Hilda Bell and Sharmic Realty Properties, Inc. DONE AND ENTERED this 9th day of August 2005, in Tallahassee, Leon County, Florida. S________ ERROL H. POWELL 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 9th day of August, 2005. COPIES FURNISHED: James Harwood, Esquire Department of Business and Professional Regulation Division of Real Estate 400 West Robinson Street, Suite N801 Orlando, Florida 32801-1757 Imani Shele, Esquire 5950 West Oakland Park Boulevard Suite 205 Lauderhill, Florida 33313 Elizabeth Vieira, Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street, Suite 802 North Orlando, Florida 32801 Leon Biegalski, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202
The Issue The central issue in this case is whether Respondent is guilty of the violations alleged in the Administrative Complaint; and, if so, what penalty should be imposed.
Findings Of Fact Based upon the testimony of the witnesses and the documentary evidence received at the hearing, I make the following findings of fact: Respondent, Naomi N. Radcliff, is licensed in Florida as a real estate broker (license No. 0369173) and has been at all times material to the Administrative Complaint. On December 2, 1987, Respondent submitted a Request for License or Change of Status form which sought to cancel the license. Thereafter, the Department reclassified Respondent as an inactive broker. In July, 1986, Randy Mangold and his wife entered into a contract to purchase real property located in Indian River Estates. Naomi Radcliff was the real estate agent who handled the transaction on behalf of the Mangolds. The Mangolds' contract provided for occupancy prior to closing with a security deposit for the rental in the amount of $1500. This amount was paid to Respondent. At closing the $1500 security deposit was to be applied to the buyers' closing costs. The Mangolds rented the home for a year and attempted to obtain financing for the purchase. When their mortgage application was denied, they elected to vacate the property. After they vacated the property, the Mangolds requested the return of the $1500 security deposit. Demands were made on Respondent who refused to return the deposit despite the fact that the Mangolds had fully paid all rents owed and had left the house in good condition. Finally, the Mangolds sued Respondent in the St. Lucie County Court and obtained a judgment for the $1500 security deposit. Respondent has not satisfied the judgment. At one point Respondent did give the Mangolds a check for $500 which was returned due to insufficient funds in the account. In December, 1986, Respondent acted as a rental agent for Walter Zielinski, an out-of-state owner. Mr. Zielinski owned two houses in Port St. Lucie, one of which was located at 941 Fenway. In early December, 1986, Respondent advised Mr. Zielinski that the tenants had left the home at 941 Fenway and that the unit was in fairly good condition. Sometime later in the month, Mr. Zielinski discovered the house was empty but that it had been damaged. There were holes in the wall in the utility room approximately two feet in diameter. The flooring in the utility room and kitchen was ripped up. There was a hole in the wall in the master bedroom. More important to Mr. Zielinski, the house was unsecured because the garage door latch was broken and the house was accessible through the garage. After discovering the unit was at risk for additional damage, Mr. Zielinski attempted to contact Respondent but numerous calls to Respondent, her place of work, and to a former employer proved to be unsuccessful. Finally, Mr. Zielinski obtained another real estate agent to represent the 941 Fenway home. The new agent, Cathy Prince, attempted to obtain from Respondent the keys, the security deposit, and the rent money belonging to Mr. Zielinski. In January, 1987, Mr. Zielinski came to Florida from Illinois to take care of the rental problems. Mr. Zielinski incurred expenses totalling $876.74 to repair the damages to 941 Fenway. Also, Mr. Zielinski wanted to collect the rents owed by Respondent for his other property and have the security deposit for the second property transferred to the new agent. Respondent issued a personal check for the security deposit which was returned for insufficient funds. A second personal check paid to Mr. Zielinski for the rent owed was accepted and cleared. According to Mr. Zielinski, Respondent did not maintain an office where he could find her during the latter part of December, 1986 through January, 1987. In March, 1987, the security deposit for Mr. Zielinski's second rental was paid to the new agent. The check was issued by Respondent's mother. Respondent never personally returned any calls to the new agent. In June, 1986, Alyssa and Jeffrey Maloy entered into a contract to purchase a house. Respondent handled the real estate transaction for the Maloys. The closing was to be December 9 or 10, 1986. Respondent held monies that were required to complete the Maloy closing. Respondent attended the closing but the check tendered to the closing agent, Chelsea Title, was drawn on an trust account which had been closed. The closing agent discovered the problem and requested sufficient funds. Respondent left the closing and returned some hours later with new checks drawn on another account. After checking with the bank, it was again discovered that the funds in the account were insufficient to cover the amount needed for closing. Finally, some days later the Respondent's brother delivered a certified check to cover the amount needed to close the Maloy transaction.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Professional Regulation, Florida Real Estate Commission enter a Final Order suspending the Respondent's real estate broker's license for a period of five years. DONE and RECOMMENDED this 12th day of July, 1988, in Tallahassee, Florida. JOYOUS D. PARRISH Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 12th day of July, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-4631 Rulings on Petitioner's proposed findings of fact: Paragraphs 1-3 are accepted. With regard to paragraph 4, with the exception of the date referenced (November, 1986) the paragraph is accepted. Paragraph 5 is rejected a hearsay evidence unsupported by direct evidence of any source. The first sentence of paragraph 6 is accepted. The second sentence calls for speculation based on facts not in the record and is, therefore, rejected. Paragraphs 7-11 are accepted. With regard to paragraph 12, the first four sentences are accepted; with regard to the balance, the Respondent's brother did deliver funds to allow the Maloy transaction to close however the source of the funds is speculation based upon hearsay unsupported by the record. COPIES FURNISHED: Steven W. Johnson, Esquire Department of Professional Regulation, Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Darlene F. Keller, Executive Director Department of Professional Regulation, Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 William O'Neil, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Naomi N. Radcliff 1420 Seaway Drive Fort Pierce, Florida 33482
The Issue This case is presented in the form of an Administrative Complaint brought by the Petitioner against the Respondent. The Administrative Complaint, in its general terms, accuses the Respondent of improperly refunding deposit money to prospective purchasers of real estate in the face of a conflicting demand on that deposit money made by the prospective seller. These actions purportedly violate Subsection 475.25(1)(d), Florida Statutes.
Findings Of Fact Following the service of the Administrative Complaint discussed in the Issues statement to this Recommended Order, the Respondent indicated his disagreement with the matters set forth in that Administrative Complaint, to the extent of disputing allegations of fact contained in that document. In the face of this factual controversy, a Subsection 120.57(1), Florida Statutes, hearing was requested by the Respondent and the Petitioner forwarded the matter to the Division of Administrative Hearings for consideration. Subsequently, a formal hearing was held on January 28, 1982. In the course of the hearing, Petitioner presented two (2) witnesses, Ernest Olinger and Patsy N. Baucant. The Petitioner also offered three (3) items of evidence which were received. Respondent testified and offered two (2) items of evidence which were admitted. The petitioning agency is an agency of State government which has, among other functions, the licensure of real estate brokers and salesmen and the requirement to take disciplinary action when those brokers or salesmen are suspected of violating the regulatory provisions related to their right to operate as real estate salesmen and brokers. This duty on the part of the Petitioner forms the basis for the accusations placed against the Respondent. At all times pertinent to this Administrative Complaint, Respondent was licensed and continues to be licensed as a real estate broker, having been issued License No. 00085431 by the Board of Real Estate in the State of Florida. The address of record for the Respondent, which is on file with the petitioning agency is: c/o G. W. Stone, Inc., 1001 Fourth Street North, St. Petersburg, Florida. The Respondent maintains two offices, one at the 1001 Fourth Street North address and the other located at 14701 Gulf Boulevard, Madeira Beach, Florida. During the period in question by the Administrative Complaint, Respondent was a broker in charge of and operated from the office at Madeira Beach which is part of the corporate arrangement, G. W. Stone, Inc. Respondent was one of the member-brokers of G. W. Stone, Inc. Respondent's son, Robert D. Stone, was a broker in charge of and operated from the Fourth Street North office in the relevant period. On or about July 12, 1979, Ernest Olinger who was associated with G. W. Stone, Inc., in the position of real estate salesman, obtained a sales listing of a premises at 6823 Seventeenth Lane, North Meadow Lane, St. Petersburg, Florida, owned by one Patsy N. Baucant. At that time, Olinger was working out of the Fourth Street North office of the corporation. (Sometime between July 12, 1979, and October 9, 1979, Olinger was dismissed from this employment with that corporation and accepted a position with Bayfront Real Estate, Inc., in Pinellas County, Florida. Nonetheless, he continued to be associated with the Baucant listing.) On October 9, 1979, another salesman employed by G. W. Stone, Inc., negotiated and obtained a contract for purchase of the Baucant property by Val Etter and Rita Locke. The terms and conditions of that purchase may be found in the sales agreement and deposit receipt which is Petitioner's Exhibit No. 2, admitted into evidence. This contract was signed by Etter and Locke and the seller, Baucant; with R. Holmes Campbell, the real estate salesman who negotiated and obtained the contract, witnessing the Etter, Locke and Baucant signatures and Olinger witnessing the signature by Baucant. Etter and Locke paid $1,000.00 for earnest money deposit on account in contemplation of the purchase. By the terms of the contract, the property conveyance was contingent upon transferring to the "purchaser" the existing mortgage at Sun Bank and Trust Company of St. Petersburg, Florida, at the prevailing assumption rate. In keeping with this provision of the contract, both Locke and Etter applied for the assumption of the mortgage. Etter was approved and Locke was disapproved on the loan application. A copy of the loan disapproval related to Locke may be found as an attachment to Petitioner's Exhibit No. 1, admitted into evidence. Campbell then spoke to Olinger and advised Olinger that Locke and Etter had dissolved their living arrangement, which was an arrangement not based upon a formal marriage. Campbell also told Olinger that the closing of the property would have to be done in Etter's name, to the exclusion of Locke, and a closing date was established for November 30, 1979. Olinger went to the closing on the date scheduled and was the only individual in attendance. The property never was closed. Within a period of a few days following the scheduled date for closing, Baucant asked Olinger about the deposit money and was told that he did not handle those matters, in that it was not his function and that she should contact the Respondent. Baucant did in fact call the Respondent in the presence of Olinger. Baucant, in the course of that conversation, made known her desire to have the deposit money and asked what he intended doing with it. Stone's response was to the effect that at that time he, "did not know." Baucant called the Respondent a couple of days later and he indicated that he had given the money to Rita Locke. Stone had in fact returned the $1,000.00 earnest money deposit to Rita Locke by payment from the escrow account of G. W. Stone, Inc. This took place on December 7, 1979. A copy of that check may be found as Petitioner's Exhibit No. 3, admitted into evidence. When confronted with his reasoning for disbursing this money, Respondent indicated to Baucant that Locke and Etter had a personal argument. The money had been disbursed to Locke following demands by Etter and Locke made to Campbell who in turn advised the Respondent of the demand for refund of the earnest money. From the facts presented, it is determined that Stone disbursed the earnest money deposit to Locke at a time when he knew that Baucant had a competing claim on that deposit money. In the course of the hearing, Respondent denied that he had any conversation with Baucant concerning the topic of requests for the earnest money deposit in question. He made this denial on the basis of his failure to recollect such conversations. He did indicate that he had a policy to return deposits to prospective purchasers in circumstances such as set forth in the contract. In Stone's estimation, based upon what he knew of the matters, he returned the money to Locke because she was entitled to receive it.
Findings Of Fact Steven R. Myer is a registered real estate broker and at the time relative to the complaint was a registered real estate salesman. Jerome Myer, the brother of Steven Myer, became interested in purchasing real property described as Lot 31, Block 7, Royal Palm South, Section 2, Broward County. Jerome Myer entered into negotiations with Mort Lynn as representative for Mark Builders, Inc., owners of the property. As a result of negotiations between Jerome Myer and Mort Lynn, Jerome Myer negotiated the purchase of the aforesaid property for $51,600. Mort Lynn advised Jerome Myer that because he (Jerome Myer) had not been in Florida for a long time, he would more easily obtain mortgage financing if he and his brother Steven Myer joined in the contract for the purchase of the aforesaid property. Thereafter, Steven and Jerome Myer contracted to purchase the aforesaid property for $51,600. When Jerome Myer applied for mortgage financing on the aforesaid property at Chase Federal Savings and Loan, he was advised that his credit was good enough that his brother, Steven Myer, would not have to be included in the transaction. At this point the brothers, Steven and Jerome, agreed that Steven Myer would not participate in the transaction, and that Jerome Myer would obtain title to the property in his name alone. Jerome Myer notified Mort Lynn of Mark Builders of his intentions in this regard and contacted his attorney regarding whether it would be necessary for Steven Myer to assign his interest in the Contract for Purchase to him. The attorney advised Jerome Myer that this was unnecessary unless for some reason Jerome questioned his brother's integrity. Because Jerome was close to Steven and did not have any doubts about his brother's involvement in the transaction, an assignment was not made. Jerome Myer was contacted by Cloys and Vena Kerbo subsequent to a home being built on the aforesaid property. The Kerbos were interested in seeing the home; and because Jerome Myer was unable to leave his work at the time, he asked his brother Steven to show the Kerbos the home. Steven showed the Kerbos the home but the Kerbos did not evidence an interest in the home. Steven advised the Kerbos that as salesman for Berg Agency he knew of other homes which he could show them; and pursuant toe their request, they were shown homes brokered by Berg Agency. Jerome's home was not brokered by the Berg Agency for whom Steven was a salesman. Subsequently, the Kerbos contacted Jerome Myer and a price fob the home was eventually negotiated. Jerome Myers acquired blank forms for a contract to buy and a deposit receipt from an office supply house and his wife typed the agreement between the Kerbos and Jerome on these forms as dictated by Jerome. The executed Contract to Buy and deposit receipt, Exhibit 1, was executed by the Kerbos and Jerome Myer. While the Kerbos and Jerome Myer met at the office of Berg Agency to execute the contract, neither Steven Myer nor Berg Agency participated in the transaction. Cloys Kerbo made and delivered a check in the amount of $1,000 to Jerome Myer as an earnest money deposit on the aforesaid Contract to Buy. This check was deposited by Jerome Myer into his personal account. Beyond the initial showing of the home to the Kerbos, there is no evidence that Steven Myer participated in the negotiation of, preparation of, or execution of the Contract for Purchase between the Kerbos and his brother, Jerome Myer. All negotiations and preparation of the Contract for Purchase were handled by Jerome Myer as owner of the property in question.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, the Hearing Officer recommends that the Florida Real Estate Commission take no action against the registration of Steven Myer. DONE and ORDERED this 26th day of October, 1976 in Tallahassee, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings Room 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Manuel E. Oliver, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789 George R. Moraitis, Esquire Post Office Box 11104 Suite 208 2631 East Oakland Park Boulevard Fort Lauderdale, Florida 33339 ================================================================= AGENCY FINAL ORDER ================================================================= FLORIDA REAL ESTATE COMMISSION UPTON B. MACKALL, Plaintiff, vs. PROGRESS DOCKET NO. 2845 BROWARD COUNTY STEVEN R. MYER, DOAH CASE NO. 76-1451 Defendant. /
Findings Of Fact On July 13, 1973 Respondent, Abelardo Blanco, negotiated a contract between South Kendall Ranch, Inc., the purchaser, and Luis Hernandez, the seller, of a tract of land in Polk County, Florida. As earnest money deposit the purchaser gave a $500 check payable to Global Realty Escrow Account and an additional $4,500 deposit when the contract was accepted by the seller. The three checks in the amount of $500, $2,000, and $2,500 were all dated July 13, 1973 and made payable to Global Realty Escrow Account. These three checks were endorsed by Blanco and deposited in Global Realty Escrow Account at Republic National Bank of Miami on July 16, 1973. By checks payable to Blanco dated July 14 in the amount of $1,000, dated July 20, 1973 in the amount of $2,100, and dated July 20, 1973 in the amount of $900, signed by Blanco, $4,000 was withdrawn from this escrow account. By check payable to Robert Jewell dated July 21, 1973, and signed by Blanco, $1,000 was withdrawn from this escrow account. No authorization to disburse these funds was ever given to Blanco by the purchaser. Due to failure of the seller to present an abstract of title of the property to the attorney for the buyer the contract was rescinded and the transaction never closed. The buyer demanded return of his earnest money deposit from Blanco and after receiving no response to several demands filed a complaint with FREC. Blanco acknowledged to the buyer that he had taken the earnest money deposit from the escrow account; and, on April 10, 1974 Blanco executed a promissory note for $5,000 payable to the buyer. Subsequently he paid $2,400 on that note before departing his last known address for parts unknown. When questioned by the investigator for FREC in October, 1974 Blanco blamed a non-active firm member of taking the escrow deposit and leaving the country; however, the checks introduced into evidence indicate that Blanco was less than truthful to the investigator. As a result of Respondent's mishandling and/or misappropriation of funds from the escrow account, the purchaser who entrusted his money to Blanco is out some $2,600.
