Findings Of Fact On March 22, 1977 during a routine inspection of various service stations in Vero Beach, a sample of No. 2 diesel fuel was taken from the pump at English Brothers Truck Stop. Upon analysis at the mobile laboratory the sample was found to be below the minimum flash point for No. 2 diesel fuel and the inspector returned to the station the same day and issued a stop sale notice. (Exhibit 3). Three additional samples were taken, and when analyzed they too were found to be below minimum flash point for this type fuel. Upon receipt of the stop sale notice the station manager notified Respondent. After the fuel had been analyzed at the state laboratory Respondent was notified that since the retail value of the contaminated fuel exceeded $1,000 it could pay $1,000 in lieu of having the fuel confiscated. Respondent owns the fuel at English Brothers Truck Stop until such time as the fuel is removed through the pump for sale. Upon receipt of the notice of the contaminated fuel, which was in one 4,000 gallon tank, Respondent immediately sent three employees to remove the contaminated fuel and clean the tank. Thereafter Respondent attempted to locate the source of the contamination but without success. Since the flash point was lower than allowed for diesel fuel the most likely source of contamination was gasoline which is a higher priced fuel than diesel. Standards used by the Petitioner in determining the required characteristics of fuels are those prescribed by the ASTM. Respondent distributes some 750,000 gallons of diesel fuel per month and this is the first report of contamination of its fuel in the eight and one half years Respondent has been in business.
Findings Of Fact On July 14, 1982, Jimmy Haywood Nixon, an employee of petitioner, took samples of gasoline offered for sale at respondent's Beacon Store No. 7 in Milton, Florida, including a sample of regular gasoline mixed with alcohol, known as "regularhol." Pat Flanagan, a chemist employed by petitioner, performed various tests on the sample of regularhol, including ASTM method 86, and determined that the 50 percent evaporated distillation temperature of the mix as a whole was 150 F. His testimony to this effect was uncontroverted. When he learned the test results, Mr. Nixon locked the regularhol pump at respondent's store in Milton, only unlocking the pump to release the mixture when a thousand dollar bond was posted on July 16, 1982. Respondent began mixing regular gasoline with ethanol and selling it as regularhol in 1978 at the same price as regular gasoline. Until recently, Mocar made less on regularhol sales than on sales of regular gasoline. It originally offered regularhol as its way of helping to reduce the national consumption of petroleum. The Phillips' terminal in Pensacola was respondent's source of the regular gasoline it mixed to make regularhol. This gasoline reached Pensacola by barge, and petitioner's employees sampled and tested each barge's cargo. The 50 percent evaporated distillation temperature of the regular gas Mocar bought from Phillips varied over a range of more than 30 degrees Fahrenheit upwards from 180 F. Mixing ethanol with the gasoline lowered its distillation temperature, but until the batch sampled on July 14, 1982, Mocar's regularhol had passed the testing petitioner has regularly conducted.
Recommendation Respondent has not been shown to be more blameworthy than any of the fuel owners involved in the cases cited above, each of whom regained part of the bond that had been posted. It is, accordingly, RECOMMENDED: That petitioner retain four hundred dollars ($400.00) and return six hundred dollars ($600.00) to the respondent. DONE and ENTERED this 19th day of December, 1982, in Tallahassee, Florida. ROBERT T. BENTON Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 19th day of December, 1982. COPIES FURNISHED: Robert A. Chastain, Esquire Department of Agriculture and Consumer Services Room 513 Mayo Building Tallahassee, Florida 32301 James Milton Wilson, Esquire 201 East Government Street Pensacola, Florida 32598 The Honorable Doyle Conner Commissioner of Agriculture The Capitol, Plaza Level Tallahassee, Florida 32301
Findings Of Fact Frank Gish operates Gish's Exxon service station, which is located at 400 Ridgewood Avenue, Holly Hill, Florida. Gish's Exxon service station purchases all of its gasoline from the Respondent, Widmaier Oil Company. On or about February 17, 1982, one of the Department's employees performed a routine inspection at Gish's Exxon service station. Samples were taken from each of the station's gasoline pumps and forwarded to a mobile laboratory. One of the samples taken was from the pump labeled "Exxon Unleaded." An examination of this sample was performed on the same date. The lead content of the sample was found to be .09 grams per gallon. After this analysis was performed, the remainder of the sample was forwarded to the Department's laboratory in Tallahassee for more detailed examination. Personnel at the Department's laboratory in Tallahassee performed a precise X-ray examination of the sample. American Society for Testing Materials standards were applied in conducting the examination. The lead content of the sample was found to be .098 grams per gallon. The Department's rules require that gasoline sold as unleaded gasoline may not contain more than .05 grams of lead per gallon Rule 5F-2.01(1)(j), Florida Administrative Code. The Department's testing techniques have a "reproducibility factor" or error factor of up to .034 grams per gallon. Thus, the Department does not take action based upon tests that it runs unless the tests reveal a lead content of more than .084 grams per gallon. The samples taken from Gish's Exxon service station exceeded this amount, and a "Stop Sale" order was issued. Widmaier Oil Company posted a bond in the amount of one thousand dollars ($1,000) with the Department, so that the gasoline could be sold as "leaded gasoline." Widmaier Oil Company has agreed to accept responsibility for the selling of any illegal product as might be determined in this proceeding. No evidence was offered at the hearing from which it could be determined how the unleaded gasoline being sold at Gish's Exxon service station came to have an excessive lead content. Respondent contended that the gasoline may have been contaminated by the Petitioner's agents wrongly placing samples of gasoline that had been taken from a leaded pump into the unleaded tank. This contention is not supported by any evidence, and it appears that the samples taken by the Respondent's agents were not sufficient in volume to have raised the lead content in the unleaded tank to a level that would have violated the Department's standards.
Findings Of Fact Respondents operating as a Majik Market, sells gasoline at 415 West Tennessee Avenue, Lynn Haven, Florida. On October 30, 1981 Mr. Haywood Nixon who is a petroleum inspector with the Department of Agriculture and Consumer Services took a sample of regular leaded gasoline from Respondent's fuel pump designated "WAY 1232" at the above location. The sample was deposited in a glass bottle and delivered to Mr. Patrick Flannigan who is a chemist for the Petitioner. On October 30, 1981 Mr. Flannigan performed certain prescribed tests on the gasoline sample. The final boiling point temperature of the sample was found by Mr. Flannigan to be 484 degrees Fahrenheit. This figure does not comply with the standards set out in Section 5F-2.01(1)(c)4. Florida Administrative Code which provides that the end point (final boiling point) of leaded gasoline shall not exceed 446 degrees Fahrenheit. The high end boiling point reading of the sample indicates that it was probably contaminated by another fuel such as diesel oil. The exact nature of the contaminant is however impossible to determine from the tests made. After receiving the results of the analysis made-by Mr. Flannigan Mr. Nixon returned to the Majik Market and issued a stop-sale notice. This notice prohibited the sale of the 4,435 gallons of contaminated gasoline remaining in Respondent's storage tank. As a result of that stop-sale notice Respondent posted a bond in the amount of $1,000. Subsequently the Petitioner issued a release notice allowing the contaminated gasoline to be removed from the State of Florida and disposed of by Respondent. Prior to the issuance of the stop- sale notice Respondent had sold 2063 gallons of gasoline from that tank since the last fuel delivery. There is no indication that the contamination discovered by the Department's test was the result of any willful or deliberate act by Respondent of Respondent's agents.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Department remit to the Respondent $500 of the $1,000 bond required to be posted in lieu of confiscation of 4,435 gallons of substandard gasoline. DONE and RECOMMENDED this 20th day of January, 1982, in Tallahassee, Florida. MICHAEL P. DODSON 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 20th day of January, 1982. COPIES FURNISHED: Leslie McLeod, Jr., Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32301 Jack G. Williams, Esquire Post Office Box 426 Panama City, Florida 32401
The Issue Whether the Department of Revenue's denial of Petitioner's application for a Florida fuel license should be upheld.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: On or about May 22, 2001, Armando Yzaguirre submitted to the Department a completed Florida Fuel Tax Application, Form DR-156, seeking licensure as a private carrier and wholesaler on behalf of Yzaguirre Oil Company, Inc. ("Yzaguirre Oil"). The application listed Mr. Yzaguirre as the president and sole stockholder of Yzaguirre Oil. Form DR-156 requests information about the applicant business and its principals, including a list of 33 questions requiring a "yes" or "no" answer from the applicant. Question number 33 asks: Have you or other owners, officers, directors, or stockholders with a controlling interest, been convicted of, or entered a plea of guilty or nolo contendere to, a felony committed against the laws of any state or the United States? Mr. Yzaguirre's sworn answer to Question number 33 was "yes." Mr. Yzaguirre provided the Department with no elucidation as to the circumstances of his admitted felony conviction. On or about June 22, 2001, Maria Yzaguirre, the wife of Armando Yzaguirre, submitted to the Department a completed Florida Fuel Tax Application, Form DR-156, seeking licensure as a private carrier and wholesaler on behalf of My Oil Company, Inc. ("My Oil"). The application listed Mrs. Yzaguirre as the president and sole stockholder of My Oil. On June 29, 2001, Mrs. Yzaguirre filed with the Department articles of incorporation for My Oil. On July 5, 2001, Mrs. Yzaguirre filed these articles of incorporation with the Secretary of State to obtain registration as a Florida domiciled corporation. Aaron Hood, a revenue specialist in the Department's motor fuel registration unit, was assigned to process both the Yzaguirre Oil application and the My Oil application. Mr. Hood conducted a standard background investigation of both applicants, securing investigative reports from the Federal Bureau of Investigation and the Florida Department of Law Enforcement on the criminal histories of Armando and Maria Yzaguirre. The reports revealed that Maria Yzaguirre had no criminal record, either of arrest or conviction. The reports revealed a lengthy list of arrests for Armando Yzaguirre. The reports included a 1980 arrest for felony arson of a structure in Collier County, and a 1990 arrest and conviction for marijuana possession in Texas. The reports were inconclusive as to whether the Collier County felony charge resulted in conviction, or whether the Texas conviction was a felony. Having difficulty determining the precise nature of the felony to which Mr. Yzaguirre admitted in his application, Mr. Hood enlisted the aid of Pete Welch, a Department investigator. On January 3, 2002, Mr. Welch reported to Mr. Hood that information received from the Clerk of the Circuit Court of Collier County confirmed that Mr. Yzaguirre had been convicted by a jury of the 1980 felony charge. However, aside from Mr. Welch's e-mail report to Mr. Hood, the Department offered no evidence confirming this felony conviction. Mr. Welch's investigation also obtained details of the Texas marijuana possession charge. In December 1990, Mr. Yzaguirre's plea of nolo contendere to a second-degree felony charge of possession of more than five but not more than 50 pounds of marijuana was accepted by the court. Mr. Yzaguirre's ten-year sentence was suspended in favor of eight years' probation and a $5,000 fine. No evidence was presented to show that Mr. Yzaguirre failed to comply with the terms of probation. Neither was evidence presented that Mr. Yzaguirre has been pardoned or that his civil rights have been restored. At the hearing, Mr. Yzaguirre indicated that he is taking steps to seek restoration of his civil rights. In his review of the Yzaguirre Oil and My Oil applications, Mr. Hood discovered that the companies claimed many of the same assets. Each company listed the same two tanker trucks to be used in transporting fuel. Each company listed 211 New Market Road, East, in Immolakee as its principal business address. Each company claimed exactly $1 million in accounts receivable. The timing of the filings and the common assets led Mr. Hood to suspect that the later My Oil application was submitted under Maria Yzaguirre's name to evade the possible disqualification of the Yzaguirre Oil application because of Mr. Yzaguirre's felony convictions. In short, Mr. Hood suspected that My Oil was a "front" corporation over which Mr. Yzaguirre would exercise control. The common assets also led Mr. Hood to suspect the truthfulness and accuracy of the financial affidavits filed by Maria Yzaguirre on behalf of My Oil. While it investigated the criminal history of Mr. Yzaguirre, the Department also investigated the extent of Mr. Yzaguirre's possible control over My Oil's business activities. Armando B. Yzaguirre is the 25-year-old son of Armando Yzaguirre and the stepson of Maria Yzaguirre. Testimony at the hearing established that Armando B. Yzaguirre completed both license applications and was the driving force behind the creation of both Yzaguirre Oil and My Oil. The elder Armando Yzaguirre's chief business is farming. His tomato and melon operation earns over $1 million per year. To save money on transporting the large amounts of fuel needed for his farming operations, Mr. Yzaguirre purchased two sizable tanker trucks in 2001, a new Peterbilt with a capacity of 9,200 gallons, and a 1998 Ford with a 2,500 gallon capacity. If these trucks were used only for Mr. Yzaguirre's farm, they would sit idle much of the time. This idle capacity gave Armando B. Yzaguirre the idea of going into the fuel transport business, using his father's tankers to deliver fuel to other farms and businesses in the area. Yzaguirre Oil was incorporated to operate as a fuel transport business. The business would be operated entirely by Armando B. Yzaguirre, who was the only member of the family licensed to drive the large tanker truck. The trucks were owned by and licensed to Yzaguirre Oil. Armando B. Yzaguirre was going through a divorce at the time Yzaguirre Oil was established. He was concerned that his wife would have a claim to half of any business he owned, and wished to ensure that ownership of Yzaguirre Oil would remain in his family. Thus, Armando B. Yzaguirre placed all ownership of Yzaguirre Oil in the name of his father, though his father would have no connection with the operation of the company's business. Subsequent to incorporating Yzaguirre Oil, Armando B. Yzaguirre discussed his prospective business with his stepmother, Maria Yzaguirre. Mrs. Yzaguirre was pleased that young Armando was establishing a business for himself. They discussed the future of the six younger Yzaguirre children and ideas for businesses that could be established to eventually be taken over by the children. Ultimately, the younger Armando and Maria Yzaguirre settled on the idea of a convenience store and filling station that could be established on part of a city block in Immolakee that the senior Mr. Yzaguirre already owned. This would be the type of business that the children could learn and work at while they were still in school, then take over after their graduation. This was the genesis of My Oil. Mrs. Yzaguirre contacted a lawyer to draft articles of incorporation and later transferred $100,000 from her personal money market account into a My Oil bank account to provide start-up money. The younger Armando Yzaguirre filled out the fuel license application, using his earlier application for Yzaguirre Oil as a model. As with the earlier application, the younger Armando Yzaguirre kept his name off the corporate documents and the fuel license application to avoid any claim by his soon-to- be ex-wife to the company's assets. He anticipated that My Oil would lease the two tanker trucks from Yzaguirre Oil, and thus listed them on the application as assets of My Oil. At the hearing, Mr. Yzaguirre conceded that he made mistakes on both applications. As noted above, he listed $1 million in accounts receivable for each of the companies. These were actually accounts receivable for his father’s farming operation, and should not have been included as assets for either Yzaguirre Oil or My Oil. Testimony from witnesses for both parties indicated that communications between the Yzaguirres and the Department were poor during the application review process. The Yzaguirres often telephoned Mr. Hood to learn the status of their applications, so often that Mr. Hood felt harassed. From their standpoint, the Yzaguirres could not understand why the applications were taking months to process, and felt that Mr. Hood was continually placing obstacles in their path and avoiding their queries. As noted above, early in the review process, the Department began to suspect that My Oil was a front for Yzaguirre Oil. At the hearing, however, the Department was unable to establish that the Yzaguirres knew of the likely rejection of the Yzaguirre Oil application in the month before they filed the My Oil application. Due to illness, Mr. Hood was unable to testify at the hearing as to his conversations with the Yzaguirres. For their part, the Yzaguirres adamantly denied any prior knowledge that the elder Mr. Yzaguirre’s criminal record would disqualify his application. Armando B. Yzaguirre, who was the Yzaguirres' point person in dealing with the Department, testified that no one at the Department made him aware that his father's criminal history was a problem until December 2001. The Yzaguirres also denied that the elder Mr. Yzaguirre would have any connection with the operation of My Oil. The Department pointed to several alleged discrepancies in the My Oil application as grounds for its suspicion that the company was a "front" for Yzaguirre Oil. First, the My Oil application, filed June 20, 2001, lists a corporate asset of $100,000 in cash on deposit at an unnamed bank, when in fact the cash was not deposited in a My Oil account at Florida Community Bank until September 10, 2001. Second, the My Oil application lists the two tanker trucks as corporate assets as of the date of application, when in fact the trucks were titled in the name of Yzaguirre Oil and the anticipated lease arrangement had yet to be consummated. Third, the My Oil application claimed the property at 211 New Market Road, East, as a corporate asset as of the date of application, when in fact the property was titled in the name of the elder Mr. Yzaguirre. Fourth, the My Oil application listed $1 million in accounts receivable as a corporate asset. As noted above, Armando B. Yzaguirre admitted at the hearing that these receivables were from his father's farming operation and should not have been listed on the application as assets of My Oil. Armando B. Yzaguirre plausibly explained that My Oil anticipated leasing the trucks, but that there was no reason to spend the money to finalize that arrangement until the fuel license was obtained and My Oil could actually commence operations. Similarly, Mrs. Yzaguirre clearly had on hand the $100,000 in cash claimed as a My Oil asset, and the timing of her actual transfer of that money into a My Oil account would not alone constitute cause for suspicion, given that My Oil had yet to commence operations when the application was filed. Armando B. Yzaguirre also convincingly explained that leasing the tanker trucks from his father's company would not give Yzaguirre Oil effective control over My Oil's business. The younger Mr. Yzaguirre contemplated that the lease agreement would be an arms-length arrangement between the two companies. If the companies could not arrive at a mutually satisfactory lease agreement, or if the lease agreement should later fall through, My Oil could lease trucks from another company and continue doing business. However, no witness for My Oil offered a satisfactory explanation as to how the elder Mr. Yzaguirre's ownership of the real property would not give him some degree of control over My Oil's business. At the time of the hearing, title to the property at 211 New Market Road, East, was in the name of Armando Yzaguirre. A warranty deed for at least a portion of the property, executed by the prior owners on July 16, 1998, was in the name of Armando Yzaguirre. The Yzaguirres did not explain whether My Oil would purchase or lease the property from the elder Mr. Yzaguirre. The structure of the arrangement is critical to the issue of the elder Mr. Yzaguirre's control over My Oil. Substitutes for the tanker trucks could be obtained in short order with little or no disruption of My Oil's business. However, the physical location of the convenience store and filling station could not be changed so readily, and the elder Mr. Yzaguirre's position as owner of that property could give him great leverage over the operation of the business. The Department also raised the issue of the undisclosed participation of Armando B. Yzaguirre in the business affairs of My Oil. The testimony of Maria Yzaguirre and of her stepson strongly indicated that the younger Mr. Yzaguirre would have substantial control over the business activities of My Oil. However, because Armando B. Yzaguirre's identity was not disclosed on My Oil's application, the Department had no opportunity to conduct a review of his background and character to determine whether he met the standard set by Section 206.026, Florida Statutes. In summary, there was no direct evidence that the Yzaguirres deliberately attempted to deceive the Department or that My Oil was established as a front to obtain licensure for the presumptively ineligible Yzaguirre Oil. The evidence did establish that Armando Yzaguirre has been convicted of at least one felony, and that his ownership of the real property on which My Oil would conduct business could provide him with control of My Oil's business activities. The evidence further established that Armando B. Yzaguirre will have control over My Oil's business, and that the Department should have had the opportunity to conduct a background review to determine his fitness under Section 206.026, Florida Statutes. In conclusion, the facts established at the hearing support the Department's denial of My Oil's application as filed, but also establish that such denial should be without prejudice to My Oil's ability to file a subsequent application curing the defects of its initial application.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order denying the application of My Oil Company, Inc. for a Florida fuel license, without prejudice to the ability of My Oil Company, Inc., to file a new application curing the defects addressed in this Recommended Order. DONE AND ENTERED this 3rd day of July, 2002, in Tallahassee, Leon County, Florida. LAWRENCE P. STEVENSON 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 3rd day of July, 2002. COPIES FURNISHED: E. Raymond Shope, II, Esquire 1404 Goodlette Road, North Naples, Florida 34102 Robert F. Langford, Jr., Esquire Office of the Attorney General The Capitol-Tax Section Tallahassee, Florida 32399-1050 Bruce Hoffmann, General Counsel Department of Revenue 204 Carlton Building Tallahassee, Florida 32399-0100 James Zingale, Executive Director Department of Revenue 104 Carlton Building Tallahassee, Florida 32399-0100
Findings Of Fact The Petitioner was acquired by Mr. Farish in November 1985. The Petitioner is a Georgia corporation. In December 1985, the Petitioner bid on a federal contract to provide fuel to federal installations in the southeastern United States. The Petitioner was awarded a contract to provide fuel oil for off-road use at Patrick Air Force Base, which is located in Florida. The Petitioner requested an application from the Department of Revenue for a special fuel license. The Petitioner was sent a motor fuel license application instead of a special fuel license application. The Petitioner filed the motor fuel license application with the Department of Revenue. The Petitioner subsequently filed a special fuel license application. It was received and validated by the Department of Revenue on June 24, 1986. The Petitioner was informed on July 9, 1986, that in order to receive the license, the Petitioner needed to file a copy of a certification to do business in Florida, which could be obtained from the Secretary of State's office. On or about January 9, 1987, the Petitioner forwarded to the Department of Revenue the certification from the Secretary of State's office needed to complete the Petitioner's license application. The Petitioner's special fuel license was issued and became effective January 9, 1987. The Petitioner began purchasing and selling special fuel in Florida on or about April 1, 1986. Between April 1, 1986 and January 9, 1987, the Petitioner paid $7,995.86 in Florida fuel tax liability for purchases of special fuel in Florida. On or about February 25, 1987, the Petitioner filed an application for special fuel tax refund in the amount of $7,995.86. The Respondent denied the tax refund application filed by the Petitioner by Order dated March 18, 1987.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order denying the Petitioner's application for refund be issued by the Respondent. DONE and ENTERED this 18th day of August, 1987, in Tallahassee, Florida. LARRY J. SARTIN 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 18th day of August 1989. APPENDIX TO RECOMMENDED ORDER CASE No. 87-1641 Only the Respondent filed a proposed Recommended Order containing proposed findings of fact. The Respondent failed to number its proposed findings of fact. The Respondent has, however, only proposed essentially 3 proposed findings of fact: that the Respondent denied the Petitioner's claim for refund and the justification therefore, the Petitioner made four admissions and the Petitioner is a Georgia corporation. The Respondent's first proposed finding of fact has been accepted in paragraph 12, the second proposed finding of fact has been accepted in paragraphs 6-8 and the third proposed finding of fact has been accepted in paragraph 1. COPIES FURNISHED: Honorable Gerald Lewis, Comptroller Department of Banking and Finance The Capitol Tallahassee, Florida 32399-0305 James E. Farish, Jr. President Lincoln Oil Co., Inc. Post Office Box 2904 Gainesville, Georgia 30503-0294 Edwin A. Bayo, Esquire Assistant Attorney General Department of Legal Affairs Tax Section The Capitol Tallahassee, Florida 32399-1050
The Issue The issue presented for decision herein is whether or not Petitioner's Antiknock (octane) Index number of its petroleum product was below the Index number displayed on its dispensing pumps.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received, and the entire record compile herein, I make the following relevant factual finding. Rafael Ruiz is the owner/operator of Coral Way Mobil, an automobile gasoline station, situated at 3201 Coral Way in Coral Gables, Florida. Ruiz has operated that station in excess of ten (10) years. On or about May 13, 1987, Respondent, Department of Agriculture and Consumer Services, received a customer complaint alleging that the fuel obtained from Petitioner's station made her automobile engine ping. Respondent dispatched one of its petroleum inspectors to Petitioner's station at 3201 Coral Way on May 14, and obtained a sample of Respondent's unleaded gasoline. Inspector Bill Munoz obtained the sample and an analysis of the sample revealed that the produce had an octane rating of 86.9 octane, whereas the octane rating posted on the dispenser indicated that the octane rating of the product was 89 octane. On that date, May 14, 1987, Respondent issued a "stop sale notice" for all of the unleaded product which was determined to be 213 gallons. Petitioner was advised by Inspector Munoz that the unleaded produce should be held until he received further instructions from the Respondent respecting any proposed penalty. On May 15, 1987, Petitioner was advised by John Whittier, Chief, Bureau of Petroleum Inspection, Florida Department of Agriculture and Consumer Services, that the Antiknock Index number of the sampled product was 2.1 percent below the octane rating displayed on the dispenser and that an administrative fine would be levied in the amount of $200 based on the number of gallons multiplied times by the price at which the product was being sold, i.e., 213 gallons times 93.9 cents per gallon. Petitioner did not dispute Respondent's analysis of the product sample, but instead reported that he had been advised that three of the five tanks at his station were leaking and that this is the first incident that he was aware of wherein the product tested below the octane rating displayed on the dispenser.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is hereby RECOMMENDED: That the Respondent, Department of Agriculture and Consumer Services, enter a Final Order imposing an administrative fine in the amount of $200 payable by Petitioner to Respondent within thirty (30) days after entry of the Respondent's Final Order entered herein. RECOMMENDED this 7th day of October, 1987, in Tallahassee, Leon County, Florida. JAMES E. BRADWELL 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 7th day of October, 1987. COPIES FURNISHED: Rafael E. Ruiz c/o Coral Way Mobil 3201 Coral Way Miami, Florida 33145 Clinton H. Coulter, Jr., Esquire Senior Attorney Office of General Counsel Department of Agriculture and Consumer Services Room 514, Mayo Building Tallahassee, Florida 32399-0800 Honorable Doyle Conner Commissioner of Agriculture The Capitol Tallahassee, Florida 32399-0810 Robert Chastain, Esquire General Counsel Department of Agriculture, and Consumer Services Room 513, Mayo Building Tallahassee, Florida 2399-0800
The Issue The issue is whether Petitioner is entitled to a refund of motor fuel taxes paid for motor fuel exported from Florida when Petitioner was not licensed as an exporter at the time of the transactions.
Findings Of Fact Petitioner is a Florida corporation engaged in the business of purchasing and reselling motor fuel. Petitioner, whose principle place of business is 1201 Oakfield Drive, Brandon, Florida 33509, does business within and without the State of Florida. Petitioner currently has a Florida Fuel Tax License, which is number 59-2150510. On April 5, 2004, and May 7, 12, and 13, 2004, upon Petitioner's orders, Kenan Transport loaded diesel fuel at the Marathon facility in Jacksonville, Florida, and delivered the fuel to Petitioner's Kingsland, Georgia, location. Daniel Way, the driver employed by Kenan Transport, delivered the April 5, 2004; May 7, 2004; May 12, 2004; and May 13, 2004, fuel loads to Petitioner's Kingsland, Georgia, location. 6. For the April 5, 2004; May 7, 2004; May 12, 2004; and May 13, 2004, fuel deliveries to Petitioner's Kingsland, Georgia, facility, Petitioner paid a total of $8,775.16 in Florida fuel taxes. The amount of Florida fuel taxes paid for each delivery was as follows: $2,192.99, for the April 5, 2004, delivery; $2,187.77, for the May 7, 2004, delivery; $2,187.20, for the May 12, 2004, delivery; and $2,187.20, for the May 13, 2004, delivery. At the time the four fuel deliveries noted in paragraphs 4 and 5 above were made to Petitioner's Kingsland, Georgia, facility, Petitioner did not have an exporter fuel license. Petitioner obtained an exporter fuel license that became effective December 1, 2004. The parties stipulated to the findings in paragraphs 1 through 9. Petitioner asserts that the Department should refund the fuel taxes it paid because, in the four transactions, Petitioner's account was mistakenly billed for the fuel. Gowan Oil Company (Gowan) is a distributor based in Folkston, Georgia, and has contracts with many fuel terminals in Jacksonville. Pursuant to an arrangement between Petitioner and Gowan, Petitioner did not usually buy fuel from any of the terminals in Jacksonville. Instead, Petitioner bought fuel for its truck stop in Georgia from Gowan, since Gowan could buy fuel at the Jacksonville terminals for less than Petitioner could. Depending on the price of fuel on a particular day, Petitioner would call Kenan Transport and tell the company to pick up fuel from a particular terminal in Jacksonville. The instructions relative to the above transactions were for the driver to pick up BP fuel and to put it on Gowan's account. Notwithstanding the specific instructions given to the driver, he made two mistakes with respect to the four fuel purchases. He not only mistakenly picked up the wrong fuel, Marathon fuel, but he also put the fuel he picked up on Petitioner's account, not on Gowan's account. The mistake made by the Kenan Transport driver is a common mistake made by transport drivers, who are "hauling out of multiple terminals every day." Drivers have loading cards for all of the accounts on which they pick up fuel. When picking up fuel, the driver should use the loading card which corresponds to the account for that particular load. In the four transactions that are at issue in this proceeding, the driver "loaded" the card for Petitioner's account, not the card for Gowan's account. Petitioner did not have an export license at the time of the transactions. Therefore, Marathon properly billed Petitioner for the Florida fuel taxes on the fuel that was picked up in Jacksonville, Florida, charged on Petitioner's account, and delivered to Petitioner's truck stop in Kingsland, Georgia. Petitioner tried unsuccessfully to have Marathon bill the subject fuel purchases to Gowan. If Gowan had been billed, it would not have been required to pay Florida fuel taxes on the four fuel purchases because it had an export license.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order denying Petitioner's application for a refund of fuel taxes. DONE AND ENTERED this 28th day of April, 2006, in Tallahassee, Leon County, Florida. S CAROLYN S. HOLIFIELD 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 28th day of April, 2006.
Findings Of Fact Ware Oil and Supply Company, Inc. (hereafter "Petitioner" or "Ware Oil"), is a wholesale and retail dealer of petroleum products. Ware Oil is a licensed dealer of special and motor fuels. Special fuels are primarily diesel and are used to operate off-highway equipment such as boats, farm tractors and industrial machinery. Beginning March 1980, the Department conducted a special fuels tax audit of the records of the Petitioner for the period January 1, 1977, through January 31, 1980. The special fuels tax audit resulted in a levy of a tax deficiency pursuant to Part II, Chapter 206, Florida Statutes. The taxes assessed together with penalty and interest are $6.868.06, with interest accruing at $1.70 per day from April 14, 1980. The assessment was based in sales of special fuels made by the Petitioner to four customers; Hoxie Brothers Circus, Jackson United Shows, Tommy Lynn and Pace's 66 Marina. The assessment relative to the sales of special fuel to Hoxie Brothers Circus and Jackson United Shows was due to the absence of a purchaser's affidavit of exemption from these customers and the Department's belief that they were dual users of special fuel due to the nature of their businesses. The assessment relative to Tommy Lynn was based on the Department's conclusion that Mr. Lynn was a dual user of special fuel and was an unlicensed dealer at the time the sales were made. The assessment relative to Pace's 66 Marina was based on Pace's resale of special fuels for which a dealer's license is required at the time of purchase. The taxes assessed by the Department are derived from the number of gallons of special fuel which was sold by the Petitioner to Hoxie Brothers Circus, Jackson United Shows, Tommy Lynn and Pace's 66 Marina, on which the $.08 per gallon tax was not collected. During 1977 Petitioner sold 550 gallons of special fuel to Hoxie Brothers Circus for purposes of generating electricity in order to operate circus rides and lights. The Petitioner did not have an exemption certificate from Hoxie relative to this sale although the sale invoice indicated that the fuel was for "off-road use". Sales tax of $.04 per gallon was collected by the Petitioner from Hoxie. No testimony or documentary evidence was produced to demonstrate that Hoxie in fact used the special fuel for an exempt purpose, that the special fuel was not placed into a receptacle connected to the fuel supply system of a motor vehicle and that the special fuel was not purchased for resale or far a dual use. In 1978, the Petitioner sold 300 gallons of special fuel to Jackson United a circus which generates its own electricity for circus rides and lights. The Petitioner has no exemption certificates for this sale; however, like Hoxie, the sales invoice has the term "off-road use" noted on its face. No testimony or documentary evidence was introduced to demonstrate that Jackson in fact used the special fuel for an exempt purpose, that the special fuel was not placed into a receptacle to the fuel supply system of a motor vehicle and that the special fuel was not purchased for resale or for a dual use. In 1977 the Petitioner sold 11,200 gallons of special fuel to Tommy Lynn. At that time Mr. Lynn was an independent logger who used all the special fuel purchased from the Petitioner for his logging equipment in the field and for off-road use. At the time of his purchases from the Petitioner, Mr. Lynn was a dual user of special fuels in that he used special fuel for both on and off road equipment. Mr. Lynn bought his off-road special fuels exclusively from the Petitioner and his on-road special fuel from another dealer. When audited by the Department, Petitioner did not have an exemption certificate for Mr. Lynn on file in its records. The Department in the past accepted exemption certificates obtained after sales were made. Mr. Lynn executed two after the fact exemption certificates. The first certificate was erroneously executed and a second drafted and signed in which Mr. Lynn stated that his purchases were for off-road use. The second certificate corroborates Mr. Lynn's direct testimony that the special fuel purchased from the Petitioner was used solely for off-road use. Neither of these certificates demonstrates that Mr. Lynn was a licensed dealer in special fuels. During 1977, 1978 and 1979 the Petitioner sold 52,484 gallons of special fuel to Pace's 66 Marina. Pace's used this special fuel for resale to users of commercial and pleasure boats and therefore, no sales tax was collected. The location of the special fuel pumps at Pace's make it virtually impossible to use the fuel for purposes other than boating. At the time of the fuel's purchase, Pace's presented an exemption certificate to the Petitioner. At that time, Pace's was not a licensed dealer of special fuels and its dealer's license number did not appear on the exemption certificate furnished to the Petitioner. Petitioner was unaware that Tommy Lynn and Pace's 66 Marina were required to be licensed as dealers and the exemption certificates provided by them should have that contained their dealer's license numbers and therefore, had no knowledge that the exemption certificates of Mr. Lynn and Pace's were incomplete. The sales were made by Petitioner in reliance on the certificates supplied by these two customer. The Department imposed the assessment against Hoxie and Jackson due to the lack of appropriate exemption certificates. The assessment was levied against Tommy Lynn and Pace's due to improperly completed exemption certificates which failed to reflect the dealer's license number. The Department did not consider whether the involved special fuels were in fact used for exempt purposes. The unrebutted testimony and documentary evidence regarding the sales to Tommy Lynn and Pace's 66 Marina supports Petitioner's position that the fuels sold to these two customers were in fact used for exempt purposes.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Department enter a final order upholding the tax assessment against the Petitioner, Ware Oil and Supply Company. DONE and ENTERED this 31st day of August 1981, in Tallahassee, Florida. SHARYN L. SMITH 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 31st day of August 1981. COPIES FURNISHED: Nicholas Yonclas, Esquire Akerman, Senterfitt & Eidson Post Office Box 1794 Tallahassee, Florida 32302 Jeff Kielbasa, Esquire Assistant Attorney General Department of Legal Affairs The Capitol, LLO4 Tallahassee, Florida 32301
Findings Of Fact The Petitioner, State of Florida/Department of Agriculture and Consumer Services, is an agency of government which has, among it other responsibilities, the requirement to establish and enforce standards related to minimum allowable Fahrenheit-degree-measured "flash point" as a standard for diesel fuel sold to the motoring public. This regulation is designed to avoid the potential destruction of diesel engines in various types of motor vehicles and other equipment resulting from the use of low flash point diesel fuel which is of an excessively volatile nature, somewhat akin to gasoline, for which the engines are not designed. Excessive stresses generated by burning such volatile fuel in diesel engines can result in their destruction or severe damage and possibly even injuries to operators of vehicles so powered. The Respondent operated a retail gasoline and diesel fuel service station in Ft. Pierce, Florida. Sometime prior to October 1, 1981, a representative of the Petitioner obtained a sample of diesel fuel in the amount of approximately one quart in a clear glass container, which he forwarded to the Petitioner's laboratory for testing. After the results of the laboratory testing became available, a Stop Sale Notice was issued to the Respondent on October 1, 1981, wherein he was informed that he must stop the sale of diesel fuel on the premises of the station at 3224 North Federal Highway, Ft. Pierce, Florida, on the ground that the diesel tested consisted of 90 degree flash point fuel. The parties agreed that total sales before the Stop Sale Notice amounted to more than $1,000 worth of the subject diesel, hence the $1,000 amount of the bond which was posted in lieu of the total confiscation of the product. The Respondent established that the station had recently been opened in July, 1981, after being closed for a substantial period of time. The Respondent was of the belief that the storage tanks had been pumped out and refilled prior to his opening for business and had no complaints regarding the quality of the diesel fuel. Before the tanks were filled he told fuel truck delivery drivers to "stick" the tanks to ascertain if there was any residual fuel or gasoline in them before filling them with new fuel when he opened for business. He was under the impression that this had been done. He also established that he corrected the problem with no hesitation as soon as he was informed that the diesel fuel did not meet legal standards. The Petitioner agreed that the Respondent had not acted in bad faith, but rather this was an inadvertent mistake or oversight on the part of the Respondent which he tried to rectify as soon as he became aware of it. The Respondent has never been found guilty of a violation previously.
Recommendation Having considered the foregoing findings of fact and conclusions of law, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is RECOMMENDED: That the Respondent be required to forfeit $500 of the $1,000 bond posted and the unforfeited $500 be returned to the Respondent. DONE and ENTERED this 19th day of July, 1982 in Tallahassee, Florida. P. MICHAEL RUFF 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 19th day of July, 1982. COPIES FURNISHED: Les McCloud, Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32301 Hadley Hartman Post Office Box 443 Stuart, Florida 33494 The Honorable Doyle Conner Commissioner, Department of Agriculture and Consumer Services The Capitol Tallahassee, Florida 32301
