Findings Of Fact During the times herein involved Respondent Kramer and Pankz were registered real estate brokers and Active Firm Member of Respondent, ILB, a registered corporate broker. Registered real estate salesmen were employed to obtain listings and WATS lines installed. Lists of out-of-state purchasers of Florida land were obtained and during the hours of 6 to 10 P.M. salesmen telephoned individuals from these lists provided them by ILB. Each salesman was provided with a script to follow in making his sales pitch. As one witness recalled the substance of the script was "if you felt you could make a profit on your property would you be interested in selling it?" Those indicating interest in selling at a profit were told that ILB was engaged in land sales on a large scale, that world wide investors were interested in acquiring Florida land, that they widely advertised the land that was listed with them in a catalog that went to brokers all over the world, that Florida land had greatly increased in price in recent years, that they would evaluate the owner's land and tell him what ILB thought the land would sell for. They inquired what the owner had paid for his land and obtained enough of the description to ascertain the size of the plot. For those interested in selling, a package was sent containing newspaper clippings about foreign investors being interested in Florida land, an "Important Facts" sheet containing much of the information passed to the owner on the first telephone call, a list indicating publications and newspapers in which ILB advertises, photocopies of what purports to be inquiries received from around the world as a result of ILB's advertising, and a copy of a Listing and Brokerage agreement. When the owner was again called about a week after the first call he was quoted a price for his property, nearly double what he had paid for it, and advised if he would list the property with ILB every effort would be made to quickly obtain a buyer. It was explained that because of the expense of advertising it was necessary for the owner to pay listing fee, which was fully refundable out of the 10 percent selling commission that ILB would earn when the property was sold. The advance listing fee which the owner forwarded when he executed the listing and brokerage agreement varied between $250 and $350. The listing agreement provided, inter alia, that owner "understand(s) that this agreement does guarantee the sale of my property but that it does guarantee that you will make an earnest effort pursuant to the aforementioned provisions." Out of this listing fee the salesman was paid approximately 1/3. No arrangement was made between ILB and the salesman regarding any additional commission to the salesman if the property was sold. No effort was made by the listing salesman to sell any property listed, although one witness testified that she did ask some of those she called if they wanted to purchase property. No evidence was presented that any of the property for which listing fees were received was sold by ILB. Several of the witnesses had been told by Respondents that sales had been made, but no corroboration of this hearsay was ever presented. The Respondent brokers Kramer and Pankz refused to answer any questions regarding the operation of the corporate broker ILB on grounds that such answers might tend to incriminate them. Accordingly no substantive evidence was presented that any sales or efforts to sell the properties listed was made prior to December, 1975. Exhibit 29, the Consent Order between the Division of Consumer Affairs and ILB, corporate officers and salesmen of ILB, was entered on July 2, 1976. The Complaint in that proceeding, was the basis for Respondent's collateral estoppel argument to dismiss the instant proceeding, was filed April 10, 1976, following extensive investigation of ILB. This is pointed out solely to accentuate the fact that practically all of the documents in Exhibit 27 and 28, which were offered into evidence by Respondents to show that they were making bona fide efforts to sell the properties listed, were prepared subsequent to the commencement of the investigation of ILB. Exhibits 8, 9, and 10 were admitted into evidence, were published by Respondent but no substantive evidence was presented that these listings are "advertisements" of the properties for which Respondent received a listing fee or that they were distributed to anyone other than those making inquiries about property. In the forwarding letter printed on the inside of the front cover of these exhibits the selling brokers were offered a 7 percent commission of any cash sales they arranged. As noted above, the total commission in the Listing and Brokerage agreement was 10 percent. The information contained in these catalogs was not legally sufficient to locate the properties therein listed. Many of the land development companies which originally sold the properties which Respondents herein were soliciting listing commissions, head many unsold lots in these developments which they were offering for sale at prices less than one-half the prices Respondent had advised the owners the property would bring. Independent brokers in some of the areas involved, i.e. Lee, Collier, and Hendry counties testified that many of the lots in these developments were for resale at one-half the prices being asked by the developers. Exhibit 22, the Federal Corporate Income Tax Return for ILB for 1974 shows Respondent Kramer owned all of the stock of ILB during that taxable year and that $12.00 was spent on advertising. Exhibit 23, the Corporate Federal Income Tax Return for ILB for 1975 shows that $348,305.68 in gross receipts and deductions of $344,976.96, but no schedule of such deductions was attached. No evidence was presented regarding advertising expenses for taxable year 1975.
Findings Of Fact Petitioner is a state governmental licensing and regulatory agency charged with the responsibility and duty to prosecute administrative complaints relative to real estate transactions. (Official recognition of Florida Statutes, TR 6-7) Respondent is now and was at times material hereto, a licensed real estate broker in Florida, having been issued License No. 0149408. The last license to Respondent was as a broker, t/a Marathon Realty at Post Office Box 2386, Marathon Shores, Florida 33052. (Petitioner'S Exhibit 1) On or about May 2, 1985, Respondent solicited and obtained a sales contract entered into by Emily Cathy Cronnon, as purchaser, and W. J. and Delores Sarver , as sellers, for the purchase and sale of certain residential property (contract for sale). (Petitioner'S Exhibit 2) The sales transaction was scheduled to close on or about July 1, 1985, but the transaction did not close. On or about December 2, 1985, the purchaser and sellers terminated the sales contract. (Petitioner'S Exhibit 3) On or about May 13, 1985, the Respondent allowed Emily Cathy Cronnon and her live-in boyfriend, Billy Hull, to take possession and occupy the property with the knowledge and consent of seller W. J. Sarver. In this regard, W. J. Sarver denies giving permission to Ms. Cronnon to occupy the property prior to closing. However, it is found herein and the testimony of Billy Hull and Respondent substantiate the fact that Emily Cronnon and Billy Hull visited Respondent's office during early May, 1985, to find out whether they could move into the Sarver property with their furnishings prior to closing. Initially, Ms. Diabo advised Cannon and Hull that she was not at liberty to permit them to move in. However, she told them that if they liked, they could phone Mr. Server and get his permission. This was done and it is found that Mr. Sarver gave his permission to Respondent to allow Ms. Cronnon and Billy Hull to occupy the premises prior to closing, provided they turned the utilities off and then had the same turned on in their name. This was done, and the contract purchaser (Cronnon) and her boyfriend, Billy Hull, moved in prior to the time that the transaction closed. Respondent received a $500 rental payment from the purchaser on August 19, 1985. (Respondent's Exhibits 1 and 2) Respondent deposited said check in an appropriate bank account and waited eleven (11) days for that check to clear. On August 30, 1985, she wrote a $500 check to the Sarvers indicating that the same was rental payment to them for the use of their property by Cronnon and Hull. Respondent customarily waits at least ten (10) days for any check to clear before she writes a check drawn on those same funds.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Administrative Complaint filed herein be DISMISSED. RECOMMENDED this 9th day of July, 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 9th day of July, 1987. APPENDIX Rulings on Petitioner's proposed findings: 1. Accepted as modified. 7. Rejected based on credible evidence herein which reveals that Emily Cathy Cronnon and her live-in boyfriend, Billy Hull, took possession and occupied the property with the prior knowledge and consent of seller, W. J. Sarver. Rejected based on credible evidence which reveals that Respondent did not conceal the rent payment, but rather deposited the rent payment until the funds cleared her bank and she immediately thereafter transmitted the proceeds to the Sarvers. Rejected as irrelevant and unnecessary to decide the issues posed. Rejected as a conclusion and not a finding of fact. Respondent's proposed findings and conclusions are largely a brief in the form of resolutions of credibility, conflicts, recommendations as to how those conflicts should be resolved, and conclusions in the form of ultimate findings of fact. As such, they are not specifically addressed in the Appendix, but were carefully considered and reviewed by the under signed in preparation of the Recommended Order. COPIES FURNISHED: JAMES H. GILLIS, ESQUIRE SENIOR ATTORNEY DIVISION OF REAL ESTATE POST OFFICE BOX 1900 ORLANDO, FLORIDA 32802 MICHAEL H. DAVIDSON, ESQUIRE WATSON & CLARK POST OFFICE BOX 11959 FORT LAUDERDALE, FLORIDA 33339 HAROLD HUFF, EXECUTIVE DIVISION OF REAL ESTATE POST OFFICE BOX 1900 ORLANDO, FLORIDA 32502 HONORABLE VAN B. POOLE, SECRETARY DEPARTMENT OF PROFESSIONAL REGULATION 130 NORTH MONROE STREET TALLAHASSEE, FLORIDA 32399-0750 JOSEPH A. SOLE, ESQUIRE GENERAL COUNSEL DEPARTMENT OF PROFESSIONAL REGULATION 130 NORTH MONROE STREET TALLAHASSEE, FLORIDA 32399-0750
The Issue Whether Respondent's license as a registered securities salesman/agent should be suspended or revoked for alleged violations of Sections 517.07 and 517.16(1)(a), Florida Statutes, as set forth in the Administrative Complaint. At the commencement of the hearing, it was noted that the Notice of Hearing was styled incorrectly in showing David R. Edstrom as Petitioner rather than Respondent. This clerical error was harmless in view of the language contained in the body of the notice which identified the word "Respondent" as being a registered securities salesman/agent. Notice of Hearing was issued on September 15, 1976, by the Hearing Officer. Neither the Respondent nor any representative in his behalf-appeared at the hearing. Accordingly, the matter was heard as an uncontested proceeding, pursuant to Rule 28-5.25(5), Florida Administrative Code. On October 6, 1976, Respondent informed the Hearing Officer that he had forgotten the hearing and inquired as to the possibility of another hearing. (Supp. Exhibit 1). By letter of October 12, 1976, counsel for Petitioner objected to Respondent's request, citing the trouble and expense of preparing for and attending the hearing, together with the difficulty encountered in securing witnesses. (Supp. Exhibit 2) On October 14th, Respondent renewed his request, and in the alternative, requested that his license be suspended temporarily until the outcome of an appeal of a criminal conviction. (Supp. Exhibit 3) Rule 28-5.25(9), F.A.C., provides that a hearing officer shall not grant a Motion for re-hearing or reconsideration. Although this Rule admits of no exception, it does not necessarily preclude the agency involved from authorizing a new proceeding in the interests of substantial justice, upon good cause shown. In this instance, Respondent's absence admittedly was due solely to his own negligence and therefore he is not entitled to the requested relief. It is noteworthy that the Notice of Hearing included the following sentence: "The right is reserved to take such action as the law permits if either party fails to appear at the time and place set for their hearing."
Findings Of Fact Respondent is a registered securities salesman/agent under license issued on October 3, 1972, by the Petitioner. (Admin. Complaint). Respondent was president of S.E.I., Inc., Miami, Florida at the time of the alleged statutory violations. (Testimony of Campbell, Exhibit 3). In the summer of 1973, Carl Eigner of Boynton Beach, Florida, having seen newspaper advertisements of Hartwell and Associates, Inc., concerning investments in promissory notes, contacted the firm and met one of its salesman, Bill Taylor. Taylor in formed Eigner that investments in promissory notes issued-by the 2609 corporation, a real estate developer, were safe and that the value of land covered by mortgages which secured the promissory notes, by law, had to be worth twice the cost of any investment. He further stated that the directors of S.E.I., Inc. investigated developers and if found to be in sound condition, recommended sale of their notes. Taylor also told him that he would receive a "valid registered mortgage" in Polk County. Eigner thereupon withdrew money to purchase a $10,000 promissory note issued by the 2609 Corporation, secured by a mortgage deed on 4 lots. Eigner paid $9,850.00 for the note by check to Taylor. The difference of $150.00 represented interest that Eigner otherwise would have received if he had left his funds on deposit. At the time of purchase, Taylor told Eigner that he had nothing to worry about because the land value had been checked by S.E.I., Inc. At no time did Taylor advise him that the note or mortgage was registered with or exempt from registration with the State Division of Securities. The promissory note provided for monthly interest payments at the rate of 12 percent per annum, commencing December 1, 1973. It also provided that the note or any payments thereunder could not be transferred by the holder to anyone who is not a bona fide resident of Florida without the prior consent of S.E.I., Inc. The note further provided. that it would be valid only upon approval by S.E.I., Inc., as sales/agent for the 2609 Corporation. In addition to the signature of the President of 2609 Corporation on the face of the note, it also contained the following: "Sale approved: S.E.I., Inc. by David R. Edstrom, President." This block showed the signature of Respondent. (Testimony of Eigner, Exhibit 3) The securities of 2609 Corporation have never been registered with the Petitioner pursuant to Chapter 517, Florida Statutes. (Exhibit 4) Petitioner submitted in evidence certified copies of an Information and verdicts in criminal proceedings in Palm Beach County, Florida against Respondent, Case No. 75-1242-CF. These proceedings resulted in the conviction of Respondent for the sale of unregistered securities to Carl Eigner and/or Edith Eigner, Robert S. Cox and/or David F. Cox, and Michael J. Leonardi and/or Diana Leonardi, and others in violation of Sections 517.07 and 517.302, Florida Statutes. The conviction is presently on appeal. Although received in evidence, the evidence of criminal convictions is not competent evidence to establish the facts upon which they were rendered and therefore cannot be used as a basis for a finding of fact in these proceedings. (See Boshnack v. World Wide Rent-A-Car, Inc., 195 So.2d 216 (Fla., 1967).
Recommendation That the registration of Respondent, David R. Edstrom as a registered securities salesman/agent be revoked for violation of Section 517.07, Florida Statutes, as authorized by Section 517.16(1)(a), Florida Statutes. DONE and ENTERED this day of October, 1976, in Tallahassee, Florida. THOMAS C. OLDHAM Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Richard Gentry, Esquire Division of Securities Department of Banking and Finance 239 Carlton Building Tallahassee, Florida 32304 Mr. David R. Edstrom 5748 Northeast 16th Avenue Ft. Lauderdale, Florida 33334
Findings Of Fact Respondent Alvin Clifford Dropkin was exclusively connected with International Land Brokers, Inc., as a real estate salesman, from July 24, 1975, to September 9, 1975. During the period of respondent's employment, Jeffrey Kramer, a real estate broker, was president and active firm member of International Land Brokers, Inc. One of the corporation's offices consisted of two rooms. The front room contained Mr. Kramer's desk, a secretary's desk, file cabinets, a duplicating machine, and a reception area. The back room was divided into six cubicles, each with a telephone. The office complex had a regular telephone line and a WATS line. Attached to the walls of most of the cubicles most of the time were portions of a packet of papers that was mailed to certain prospects. Pages two through five of composite exhibit No. 1, together with the last page, were at one time posted on the walls of some of the cubicles. Between the hours of six and half past ten five nights a week and at various times on weekends, salespersons in the employ of International Land Brokers, Inc., manned the telephones in the cubicles. They called up property owners, introduced themselves as licensed real estate salespersons, and inquired whether the property owner was interested in selling his property. When a property owner indicated an interest in selling, the salesperson made a note of that fact. The following day, clerical employees mailed a packet of papers to the property owners whose interest in selling the salesperson had noted. Petitioner's composite exhibit No. 1 contains the papers mailed to one prospect. The contents of the materials which were mailed out changed three or four times over the year and a half that International Land Brokers, Inc., was in business. As a general rule, a week or so after the initial call to a property owner who proved interested in selling, a salesperson placed a second telephone call to answer any questions about the materials that had been mailed, and to encourage the property owner to list the property for sale with International Land Brokers, Inc. Property owners who listed their property paid International Land Brokers, Inc., a listing fee which was to be subtracted from the broker's commission, in the event of sale. When International Land Brokers, Inc., began operations, the listing fee was $200.00 or $250.00, but the listing fee was eventually raised to about $300.00. In the event the same salesperson both initially contacted the property owner and subsequently secured the listing, the salesperson was paid approximately 30 percent of the listing fee. If one salesperson initially contacted the property owner and another salesperson secured the listing, the one who made the initial telephone call was paid approximately $20.00 and the other salesperson was paid between $75.00 and $90.00 or thereabouts; when more than one salesperson was involved the sum of the amounts paid to the salespersons represented about 35 percent of the listing fee. In telephoning property owners, the salespersons worked from lists which International Land Brokers, Inc., had bought from unspecified individuals, or compiled from county tax records.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED that the administrative complaint be dismissed. DONE AND ENTERED this 1st day of August 1977 in Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 1st day of August 1977. COPIES FURNISHED: Louis B. Guttmann, III, Esquire Richard J. R. Parkinson, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789 Edward R. Johnson, Esquire Suite 208 2641 East Atlantic Pompano Beach, Florida 32062 Carl J. Zarcone, Esquire 806 Northeast Third Avenue Fort Lauderdale, Florida 33304
Findings Of Fact At all times material hereto Ralph Thomas West was a licensed real estate salesman with license number 0364011, and Charles De Menzes was a licensed real estate broker with license number 0174324. De Menzes was operating as qualifying broker and officer of De Menzes Realty, Inc., 2116 East Silver Springs Boulevard, Ocala, Florida, license number 0208877. De Menzes Realty, Inc. was a corporation licensed as a broker in Florida. From approximately September 3, 1981 to approximately June 14; 1984; West was licensed and operating as a real estate salesman in the employ of De Menzes Realty, Inc. On March 31, 1984, West obtained an exclusive right of sale listing contract from James M. and Grace Bell for the sale of certain real property. The listing contract was for six months, ending on September 30, 1984, and specified that the listing would be placed with Multiple Listing Service. West had the Bells sign the listing contract, gave them a copy, and returned to De Menzes Realty where he signed the listing and then placed it on the secretary's desk for presentation to, and signature by, De Menzes. Standard office practice was that all listings were placed in a file folder after the salesman and De Menzes had signed them, other required authorization forms were placed in the file and it was returned to the salesman who was then responsible for having all required forms in the file·assigned. The salesman then was supposed to return the file to the secretary who would place the listing with the Multiple Listing Service (MLS). De Menzes told his salesmen that they were responsible for following up on the file and making sure the listing had been placed with MLS. De Menzes does not routinely follow up on listings to insure that salesmen carry out these responsibilities, and he took no action on the Bell listing after executing the exclusive listing. After De Menzes signed the Bell listing, it was placed in a file folder along with Key Box Authorization and Notice to Sellers forms which had to be signed by the Bells. West gave these forms to the Bells on April 1, 1984, and they signed them on that date. They also gave West a key to their property and he placed a lock box on the property door. On April 7, 1984, an auction of the Bell property was held by Max Heubner, who was a licensed real estate salesman working in the employ of De Menzes Realty, Inc. as an auctioneer. Huebner arranged for the auctions himself, including the advertising, and conducted them himself. He did not seek or obtain De Menzes' approval to hold auctions. Huebner would routinely give De Menzes a copy of his auction fliers so that De Menzes would be aware that an auction was being held in case someone called the office about it. The Bell property was not sold as a result of this auction. The Bell listing was never placed in MLS. West did show the property to two people following the auction but never followed up to be sure the listing was entered in MLS. After West left the employ of De Menzes Realty, Inc., on or about June 14, 1984, no efforts were undertaken by De Menzes Realty to sell the Bell property. De Menzes Realty, Inc. and Charles De Menzes were unaware of the Bell listing until early July, 1984, when Grace Bell called the office to inquire about progress in selling the property. Gail Barbee, broker- salesperson at De Menzes Realty, told Grace Bell that there was no listing on file with De Menzes Realty, Inc., and no listing of their property had ever been placed with MLS. Barbee sent Bell a new listing contract on July 19, 1984, but the Bells decided not to reexecute another listing. On October 4, 1984, Barbee returned pictures of the property, as well as a key which Bell had sent her in response to Barbee's letter in July. In early May, 1985, West was going through his briefcase and found the entire Bell listing file; including the original listing contract. This was not a file which he prepared on the subject property but was the actual office file prepared on this listing by personnel of De Menzes Realty, Inc. West had placed the file in his briefcase by mistake and did not realize he had it until May, 1985. He subsequently submitted this file to Petitioner on May 30, 1985. The file had been in his sole possession for approximately a year, during which time he had completely forgotten about the listing, and had left the employ of De Menzes Realty.
Recommendation Based upon the foregoing it is recommended that Respondents, Charles De Menzes and De Menzes Realty, Inc., each be reprimanded. DONE and ENTERED this 16th day of October, 1985, at Tallahassee, Florida. DONALD D. CONN, 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 16th day of October, 1985. APPENDIX Rulings on Petitioner's Proposed Findings of Fact: 1. Adopted in Finding of Fact 1. 2. Adopted in Finding of Fact 1. 3. Adopted in Finding of Fact 1. 4. Adopted in Finding of Fact 1. 5. Adopted in Finding of Fact 3. 6. Adopted in Finding of Fact 3. 7. Adopted in Finding of Fact 4. 8. Adopted in Finding of Fact 5. 9. Adopted in Finding of Fact 6 and 7. Adopted in Finding of Fact 7. Adopted in Finding of Fact 7. Adopted in Finding of Fact 6. Adopted in Finding of Fact 6 and 7. Adopted in Finding of Fact 3 and 4. Rulings on Respondent's Proposed Findings of Fact: Rejected as irrelevant and unnecessary. Rejected as irrelevant and unnecessary. Adopted in Finding of Fact 3. Adopted in Finding of Fact 3 and 4. Adopted in Finding of Fact 4. Adopted in Finding of Fact 5. Adopted in Finding of Fact 6. Adopted in Finding of Fact 2. Adopted in Finding of Fact 7. Adopted in Finding of Fact 7. Adopted in Finding of Fact 6 and 7. Adopted in Finding of Fact 7. Rejected as irrelevant and unnecessary. Adopted in Finding of Fact 8. Rejected as irrelevant. Adopted in Finding of Fact 8. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation 400 West Robinson Street Orlando, FL 32801 Harvey R. Klein, Esquire 333 N.W. 3rd Avenue Ocala, FL 32670 Fred Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, FL 32301 Salvatore A. Carpino, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, FL 32301 Harold Huff, Executive Director Division of Real Estate 400 West Robinson Street Orlando, FL 32801
The Issue Whether Respondent's license as a real estate salesman should be suspended or revoked, or the licensee otherwise disciplined, for alleged violation of Chapter 475, F.S., as set forth in Administrative Complaint, dated September 2, 1981. This case involves Petitioner's allegations that Respondent should be disciplined under Subsection 475.25(1)(b), Florida Statutes, for dishonest dealing by trick, scheme, device, and breach of trust in a business transaction. Specifically, it is alleged that while Respondent was in the process of applying for his Florida real estate salesman's license, he was associated with Realty Exchange, Inc., of Tampa, Florida, and, during that association, made copies of the firm's real estate listings and placed the same on his home computer, and failed to return them after passing his real estate examination and obtaining employment elsewhere. At the commencement of the hearing, Petitioner moved to correct an inaccurate statutory reference in paragraph nine of the Administrative Complaint which cited Chapter 473 rather than 475, Florida Statutes, as the statute in question. The motion was granted. Petitioner called one witness and the Respondent to testify at the hearing, and Respondent testified in his own behalf. The Petitioner submitted five exhibits in evidence and the Respondent submitted two exhibits. Although the Administrative Complaint seeks to take disciplinary action with respect to Respondent's real estate salesman's license, the uncontroverted testimony of Respondent at the hearing established that he has held a real estate broker's license since October 13, 1981.
Findings Of Fact Respondent, Harvey T. Estes, has been a licensed real estate broker in Florida since October 13, 1981. He previously had been licensed as a real estate salesman on or about April 1, 1980 (testimony of Respondent). On or about March 13, 1980, Respondent contacted Realty Exchange, Inc., Tampa, Florida, concerning possible future employment after he obtained his Florida real estate salesman's license. Respondent was planning to take the real estate examination in approximately two weeks. When Paul R. Young, of Realty Exchange, Inc., learned of Respondent's prior successful record as a real estate salesman in Oklahoma, he encouraged Respondent to familiarize himself with the office and its real estate listings, and to view the exterior of the listed properties so that he would be in a position to start work immediately when he obtained his salesman's license (testimony of Young, Respondent, Respondent's Exhibit 1). Although Respondent was not employed by Realty Exchange, Inc., he signed a standard form used by the firm indicating that he was an "independent contractor salesman," which stated that he was responsible for his own expenses and received no remuneration from the broker, and that his "association" with the broker could be terminated by either party at any time upon notice. This "agreement," which was signed only by Respondent, was prospective in anticipation of his future association with the firm. Respondent was at Realty Exchange, Inc., for three or four days prior to king his examination for salesman. During this period, with the knowledge of Young, he made copies of various cards in office files which contained information concerning commercial properties which had been listed with the firm. The majority were "open" listings which had been obtained orally and were not supported by written listing agreements, and a small number were "exclusive" listings. At no time did Respondent ever observe any listing agreement signed by a prospective seller of property. Respondent noted that some of the information on the cards was inaccurate, and he could find no office correspondence with any of the property owners. He also determined that on one of the cards, the owner's name was incorrect and he personally changed it to reflect the correct name of the seller. Respondent placed some of the information from the cards in his home computer and developed financial data concerning a particular property, such as a cash flow analysis, cost per unit, and income per square foot. He also provided Realty Exchange, Inc. with the names of his former out-of-state clients who might be interested in purchasing Florida property (testimony of Young, Respondent, Petitioner's Exhibits 1,4). The evidence is conflicting as to whether Respondent returned to the Realty Exchange, Inc., office after taking the salesman examination. Young testified that he came back the following week and "hung around the office for a few days" and then left stating that he was going "up the country" for a few days. Young said that Respondent never returned again to the office, but that he called John White, the broker and president of the firm, on April 23 or 24, telling White that he had made another connection with a broker who paid 100 percent commissions, and that he would rather work by himself. At that time, White purportedly asked Respondent to turn in all of the "listings" and Respondent indicated that he would do so the first of the week. White did not testify at the hearing, however, as to this alleged phone conversation. Respondent testified that he never returned to the office after taking the examination, but phoned White's secretary and told her that he was not returning to the office. Respondent further claimed that he did not recall any conversation with White and that no one requested he return the listing information until his next employer, Mr. Ragan of Ragan Realty, at some undisclosed date, told him that Realty Exchange Inc., wanted their listing information returned. At this point, Respondent gathered up the information and returned it. In addition, he erased all the data he had entered in his computer. Ragan did not testify at the hearing and Young was not privy to the alleged telephone conversation between White and Respondent. Documentary evidence shows that Young complained to Petitioner by a letter dated May 2, 1980, concerning Respondent's failure to return the listing information and requesting that an investigation be undertaken. Respondent sent a letter to Young, dated June 17, 1980, which was received on June 20, reciting that the listing sheets were enclosed, and Young acknowledges that they were then received. Young testified that Respondent was never provided a written request to return the listing information because the firm did not know where he was located. However, information concerning Respondent's address and telephone number was available in the office files (testimony of Young, Respondent, Petitioner's Exhibits 2-4, Respondent's Exhibit 1). It is found that the Respondent's version of the circumstances surrounding the return of the listing information is credible and unrebutted by competent evidence. While employed with Ragan Realty, Respondent made a personal offer to purchase an apartment complex which was one of the properties carried under an open listing by Realty Exchange, Inc. Although Ragan Realty did not have a listing on the property, it did have information on the property that had been circulated to Ragan and several others by the owner. Respondent did not purchase the property. He has had no other dealings with any of the properties on which he obtained information from Realty Exchange, Inc. (testimony of Young, Respondent, Petitioner's Composite Exhibit 4). Petitioner issues a handbook which contains its interpretation of various provisions of applicable real estate law. Section 10.23 of the handbook, which was applicable during the incident involved herein, provides that it is "bad faith" for a salesman to copy records, listings, or other confidential information found in the files of the broker and to take them for his later use (Petitioner's Exhibit 5)
Recommendation That the Board of Real Estate dismiss the charges against Respondent, Harvey T. Estes. DONE and ENTERED this 25th day of March, 1982, in Tallahassee, Florida. THOMAS C. OLDHAM 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 25th day of March, 1982. COPIES FURNISHED: Grover C. Freeman, Esquire FREEMAN & LOPEZ, P.A. 4600 West Cypress, Suite 410 Tampa, Florida 33607 Richard S. Patterson, Esquire Post Office Box 24571 Tampa, Florida 33623 Mr. C. B. Stafford Executive Director Board of Real Estate Post Office Box 1900 Orlando, Florida 32801 Fred Wilsen, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
Findings Of Fact At all times pertinent to this hearing, Respondent, George Aliferis, was licensed as a real estate salesman in Florida under License No. 0325121. During all of April and May, 1980, Respondent was an associate in the real estate office of George D. Willmer. Mr. Willmer, a registered real estate broker, had managed property located at 713 East Court Street in Longwood, Florida, a 7-year-old home owned by William and Gloria Thomas, for several years while the Thomases were away, living in South Carolina. On April 3, 1980, Mr. and Mrs. Thomas entered an exclusive listing of their property for sale with Mr. Willmer. The asking price was $42,500, with $10,000 down, assumption of a first mortgage of $16,750, and the Thomases would hold a second mortgage of $15,750. Before executing the sales listing, the Thomases were advised by Mr. Willmer, their agent, that a sales price of $40,000 was fair, as other comparably sized houses in the area were selling for between $37,000 and $41,000. The price of $42,500 was to give the Thomases some bargaining room. On April 15, 1980, Respondent, who was then a salesman in Mr. Willmer's agency, submitted an offer to purchase the Thomases' property for $40,000, the exact price suggested by Mr. Willmer, his broker, to the Thomases, with $500 cash paid at time of offer, assumption of the first mortgage described above, a second mortgage of $13,250.10, and $9,500 cash at closing. The contract executed that date by Respondent listed him, his assigns or nominees as buyer, and called for a closing by June 30, 1980. This date was unilaterally changed to May 30, 1980, by the Respondent on April 16, 1980, the day after the offer was made. On April 16, 1980, the Thomases telegraphed their acceptance of Respondent's offer and terms with the exception that they stipulated closing would be held on or before May 15, 1980. The contract document signed by Respondent, bearing the May 30, 1980, closing date, was signed by the Thomases on April 20, 1980. On Sunday evening, April 27, 1980, Respondent telephoned Mr. and Mrs. Philip Fillman, then recent arrivals in the Orlando area, whom he had heard were looking for a house to buy. The Fillmans met the next day with Respondent, who took them to see the Thomas house. After checking it over, they decided to make an offer. Respondent had advised them during this period that comparable homes in the area were selling for $55,000 to $61,000 and that this house listed at $45,500 was a good investment. When the Fillmans asked if the owners would possibly take less, Respondent replied they would not, having already turned down a lesser offer. At no time did Respondent indicate he already had the house under contract for $40,000 or that he was representing himself. At no time was any offer for the property, other than that submitted by Respondent for $40,000 which was accepted by the Thomases, ever submitted to them by Respondent, Mr. Willmer, or anyone else. The Fillmans agreed to the $45,500 price and, on April 28, 1980, executed a contract to buy the property in question for that price, making a cash down payment at the time of execution of $6,000 payable to George Aliferis, the Respondent. Respondent deposited that check to his personal account at Park Federal Savings and Loan Association. It was not put into the real estate agency's escrow account. The name of the seller on the contract signed by the Fillmans was not the Thomases, but was instead George Aliferis, who indicated he had "control" of the property. He did not explain what that term meant. The contract executed by the Fillmans and by Respondent in his own name the same day, April 28, 1980, called for assumption of both mortgages and closing by June 1, 1980. Because the Fillmans were renting, they asked for, and received from Respondent, permission to move into the house prior to closing. They did so on May 11, 1980. Closings on both transactions were held at the law office of David Kerben in Orlando on May 14, 1980, in succession. At the first closing not personally attended by the Thomases, they conveyed the property to Respondent, who paid a net of $6,499.90 in cash which represented the net to close for the $40,000 purchase price, less $550 required to fix the air conditioner which had been complained of by the Fillmans. At that closing, Respondent also executed a second mortgage to the Thomases in the amount of $13,250 as a part of the purchase price. Within minutes of the Thomas-Aliferis closing referenced above, Respondent then conveyed the property to the Fillmans, who were present at the closing and who paid a net to close of $10,126.40 after a $6,000 down payment, and the two mortgages totaling $29,842.10. At the closing, the Fillmans signed a form relating to property insurance which also bore the notation that a payment of $159.05 was due to the Thomases (their address was also listed) on June 14. When the Thomases received that payment from the Fillmans, they called to find out why the Fillmans had sent the payment and in the course of this conversation, which took place on July 14, 1980, both parties first learned of the course of events which led up to the Fillmans' purchase. Up until that point, neither Mr. Willmer nor Respondent had made clear the nature of the transaction, except that on May 14, 1980, when the Fillmans arrived at lawyer Kerben's office for the closing, Respondent met them outside and said something about having just taken title to the property. Respondent contends that at the time he contracted with the Thomases to buy the property, he intended to live in it if his wife approved of it, or to lease it out on a long-term basis as an investment. However, Respondent had just recently moved into a newly built house and, in fact, put the property in question up for sale within two weeks of his contract. Respondent also indicated that he had been a real estate, agent only a few months, yet his application for licensure shows he was a licensed real estate agent in Maryland for approximately five years. In light of this evidence, I find the Respondent's credibility to be questionable and that he failed to fully disclose all required information regarding the transaction to his parties, the Thomases.
Recommendation In light of the above, it is, therefore, RECOMMENDED: That Respondent's license to practice real estate in Florida be suspended for one year and that an administrative fine of $1,000 be imposed upon him. RECOMMENDED this 8th day of September, 1983, in Tallahassee, Florida. ARNOLD H. POLLOCK Hearing Officer Division of Administrative Hearings Department of Administration 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 8th day of September, 1983. COPIES FURNISHED: Tina Hipple, Esquire Gary Printy, Esquire Department of Professional Regulation 400 West Robinson Street Orlando, Florida 32801 Erik C. Larsen, Esquire 243 West Park Avenue Winter Park, Florida 32789 Mr. Harold Huff Executive Director Florida Real Estate Commission 400 West Robinson Street Orlando, Florida 32801 Mr. Fred Roche Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 William M. Furlow, Esquire Department of Professional Regulation 400 West Robinson Street Orlando, Florida 32801
Findings Of Fact Respondent J. Donald Mayor was exclusively connected with International Land Brokers, Inc., as a real estate broker-salesman, from November 17, 1975, to February 15, 1976. During the period of respondent's employment, Walter J. Pankz, a real estate broker, was also associated with International Land Brokers, Inc. At least until shortly before respondent began work with International Land Brokers, Inc., one of the corporation's offices consisted of two rooms. The front room contained a desk for Mr. Kramer, another real estate broker, a secretary's desk, file cabinets, a duplicating machine, and a reception area. The back room was divided into six cubicles, each with a telephone. The office complex had a regular telephone line and WATS line. Attached to the walls of most of the cubicles most of the time were portions of a packet of papers that was mailed to certain prospects. Pages two through five of composite exhibit No. 11 together with the last page, were at one time posted on the walls of some of the cubicles. Between the hours of six and half past ten five nights a week and at various times on weekends, salespersons in the employ of International Land Brokers, Inc., manned the telephones in the cubicles. They called up property owners, introduced themselves as licensed real estate salespersons, and inquired whether the property owner was interested in selling his property. When a property owner indicated an interest in selling, the salesperson made a note of that fact. The following day, clerical employees mailed a packet of papers to the property owners whose interest in selling the salesperson had noted. Petitioner's composite exhibit No. 1 contains the papers mailed to one prospect. The contents of the materials which were mailed out changed three or four times over the year and a half that International Land Brokers, Inc., was in business. As a general rule, a week or so after the initial call to a property owner who proved interested in selling, a salesperson placed a second telephone call to answer any questions about the materials that had been mailed, and to encourage the property owner to list the property for sale with International Land Brokers, Inc. Property owners who listed their property paid International Land Brokers, Inc., a listing fee which was to be subtracted from the broker's commission, in the event of sale. When International Land Brokers, Inc., began operation, the listing fee was $200.00 or $250.00, but the listing fee was eventually raised to about $300.00. In the event the same salesperson both initially contacted the property owner and subsequently secured the listing, the salesperson was paid approximately 30 percent of the listing fee. If one salesperson initially contacted the property owner and another salesperson secured the listing, the one who made the initial telephone call was paid approximately $20.00 and the other salesperson was paid between $75.00 and $90.00 or thereabouts; when more than one salesperson was involved the sum of the amounts paid to the salespersons represented about 35 percent of the listing fee. In telephoning property owners, the salespersons worked from lists which International Land Brokers, Inc., had bought from unspecified individuals, or compiled from county tax records.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That the administrative complaint be dismissed. DONE and ENTERED this 5th day of August, 1977, Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Mr. Louis B. Guttmann, III, Esquire and Mr. Richard J.R. Parkinson, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789 Mr. Sherman Bennett Mayor, Esquire, and Mr. Eugene Steinfeld, Esquire 174 East Flagler Street Suite 1007 Miami, Florida 33131
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: At all times relevant hereto, respondent, Columbus Equities International, Inc. (Columbus Equities), was registered as a broker/dealer with petitioner, Department of Banking and Finance, Division of Securities and Investor Protection (Division), having been issued broker/dealer registration number 30936. The business address of the firm was 6321 East Livingston Avenue, Reynoldsburg, Ohio. Respondent, Roger L. Parsons, was registered with the Division as an agent with Columbus Equities. He was also registered with the National Association of Securities Dealers (NASD) as the financial and operations principal, general principal and representative of Columbus Equities. As such, Parsons was responsible for supervising the employees of Columbus Equities. Similarly, under the terms of Rule 3E-600.002(4), Florida Administrative Code, Columbus Equities was also responsible for the acts of its employees. Prior to June 1990, Columbus Equities was known as Parsons Securities, Inc. The business was originally formed in 1978 by Parsons, who is majority stockholder and serves as its president, secretary and director. In June 1990, the firm's name was changed to Columbus Equities International, Inc. In January 1991, Columbus Equities filed for protection under Chapter 7 of the Federal Bankruptcy Law. When the events herein occurred, Vincent C. Lombardi was registered with the NASD as general securities principal, representative and registered options principal of Columbus Equities. Lombardi's business address was 450 Tuscarora Road, Crystal Bay, Nevada, where he managed the Nevada branch office of Columbus Equities. Except for Ohio, Lombardi was not registered to sell securities in any other state, including Florida. In the fall of 1990, a Division financial analyst, Joanne Kraynek, received a letter from the Nevada Securities Commission. Based upon that letter, Kraynek wrote a letter on November 21, 1990, to "Parsons Securities/Columbus Equities International, Inc." regarding that firm's alleged sale of unregistered securities to a Florida resident. The letter requested various items of information. On December 6, 1990, Lombardi replied to Kraynek's letter on behalf of Columbus Equities and enclosed a number of documents in response to her request. Based upon this information and a subsequent investigation by the Division, the following facts were determined. On May 31, 1990, Charles D. Flynn conducted a transaction on behalf of his wife, Susan, for the purchase of 4,933 shares of World Videophone, an unregistered security. On June 22, 1990, Flynn purchased 2,500 shares of White Knight Resources Limited on behalf of his wife. That security was also not registered in the State of Florida. On July 9, 1990, Flynn purchased an additional 2,000 shares of White Knight Resources Limited on behalf of his wife. In each transaction, the trade was executed by Lombardi from the Nevada branch office of Columbus Equities. When the sales occurred, Flynn and his wife resided at 2045 Parkside Circle South, Boca Raton, Florida. In finding that the Flynns were Florida residents at the time of the trades, the undersigned has rejected a contention by Parsons that Flynn purchased the stocks while residing in Canada and thus the transactions were not subject to the Division's jurisdiction. Evidence of these transactions and the Flynns' Florida domicile is confirmed by the deposition testimony of Mr. Flynn, admissions by Lombardi, and copies of the order tickets from the Nevada branch office. The order tickets reflect the code "MM" (market maker), which means that Columbus Equities held the securities in its own inventory and did not have to go to an outside source to obtain the stocks. Thus, Parsons (on behalf of Columbus Equities) should have been familiar with these securities. However, at hearing he acknowledged that he was not. This in itself is an indication that Parsons was not properly supervising his employees. Finally, there was no evidence that the three transactions were exempt within the meaning of Sections 517.051 and 517.061, Florida Statutes, and thus were beyond the Division's jurisdiction. As the principal for Columbus Equities, Parsons was responsible for supervising the activities of both Lombardi and the Nevada branch office. Indeed, section 27, article III of the NASD Rules of Fair Practice requires that a NASD member such as Parsons supervise the activities of all associated persons to insure that those persons are complying with all securities laws and regulations. In order to fulfill this duty, Parsons should have reviewed on a timely basis the monthly statements generated by the Nevada office as well as that office's new account applications. For the reasons stated hereinafter, Parsons' review of Lombardi's activities was neither complete nor timely. The Flynn account was opened by Lombardi in April 1990 and Lombardi was the only employee who dealt with the Flynns. Parsons had no knowledge that the Flynn account had been opened because he did not review new account applications. This failure to review new account applications prevented Parsons from detecting whether Lombardi was selling securities in states such as Florida where he was not registered. Lombardi was required to send Parsons a monthly statement reflecting the activity of the branch office. During his review of the May statement in the second or third week of June 1990, Parsons became aware of the first Flynn transaction. Just prior to that, Parsons had learned that Lombardi had also engaged in another illicit trade. In addition, Parsons subsequently became aware of at least four other transactions (including two more with the Flynns) involving the sale of securities by Lombardi in states where he was not registered. However, except for a verbal warning given to Lombardi to discontinue that type of trade, Parsons took no disciplinary action against Lombardi until September 13, 1990, when Lombardi was terminated as an employee and the Nevada branch office closed. By failing to review the new account applications and to take prompt action against Lombardi after having learned of his indiscretions, Parsons failed to properly supervise his employees. Rule 3E-600.014(6), Florida Administrative Code, requires that each member establish, maintain and enforce written procedures governing the conduct of its employees to ensure compliance with all security laws and regulations. To this end, Parsons developed a policy (compliance) manual which was to serve as a guide in the conduct of all employees of Parsons Securities, Inc. and its successor, Columbus Equities. A copy of this manual should have been given to each employee, including Lombardi, for his or her review. However, Parsons did not know if Lombardi ever received and reviewed the manual. In addition, the manual itself was deficient in that it failed to indicate whether employees were to be given a copy for review, and it contained no provisions for taking disciplinary action against an agent if he violated a manual proscription. By failing to develop and utilize an appropriate manual, respondents violated the above cited rule.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered by petitioner finding respondents guilty of all violations alleged in the administrative complaint, ordering respondents to cease and desist all unlawful activities, and imposing a $5,000 fine, jointly and severally, against them. DONE and ENTERED this 26th day of May, 1992, in Tallahassee, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 26th day of May, 1992.
Findings Of Fact Respondent Walter Penn was exclusively connected with International Land Brokers, Inc., as a real estate salesman, from May 15, 1975, to September 19, 1975, and again from December 29, 1975, until no later than April 11, 1976. During respondent's first period of employment, Jeffrey Kramer, a real estate broker, was president and active firm member of International Land Brokers, Inc. One of the corporation's offices consisted of two rooms. The front room contained Mr. Kramer's desk, a secretary's desk, file cabinets, a duplicating machine, and a reception area. The back room was divided into six cubicles, each with a telephone. The office complex has a regular telephone line and a WATS line. Attached to the walls of most of the cubicles most of the time were portions of a packet of papers that was mailed to certain prospects. Pages two through five of composite exhibit No. 1, together with the last page, were at one time posted on the walls of some of the cubicles. During respondent's second period of employment by International Land Brokers, Inc., Walter J. Pankz, a real estate broker, worked for the firm in a supervisory capacity. Between the hours of six and half past ten five nights a week and at various times on weekends, salespersons in the employ of International Land Brokers, Inc., manned the telephones in the cubicles. They called up property owners, introduced themselves as licensed real estate salespersons, and inquired whether the property owner was interested in selling his property. When a property owner was interested in selling, the salesperson made a note of that fact. The following day, clerical employees mailed a packet of papers to the property owners whose interest in selling the salespersons had noted. Petitioner's composite exhibit No. 1 contains the papers mailed to one prospect. The contents of the materials which were mailed out changed three or four times over the year and a half that International Land Brokers, Inc., was in business. A week after the initial call to a property owner who proved interested in selling, a salesperson placed a second telephone call to answer any questions about the materials that had been mailed, and to encourage the property owner to list the property for sale with International Land Brokers, Inc. Property owners who listed their property paid International Land Brokers, Inc., a listing fee which was to be subtracted from the broker's commission, in the event of sale. When International Land Brokers, Inc., began operations, the listing fee was $200.00 or $250.00, but the listing fee was eventually raised to about $300.00. In the event the same salesperson both initially contacted the property owner and subsequently secured he listing, the salesperson was paid approximately 30 percent of the listing fee. If one salesperson initially contacted the property owner and another salesperson secured the listing, the one who made the initial telephone call was paid approximately $20.00 and the other salesperson was paid between $75.00 and $90.00 or thereabouts; when more than one salesperson was involved the sum of the amounts paid to the salespersons represented about 35 of the listing fee. In telephoning property owners, the salespersons worked from lists which International Land Brokers, Inc., had bought from unspecified individuals, or compiled from county tax records. In late June or early July, respondent telephoned Carol Larson and solicited a listing of certain real estate in the Bahamas which Carol and Arthur Larson had purchased in 1970 for twenty-eight hundred dollars ($2,800.00). In a second telephone conversation, respondent told Mrs. Larson about several sales of property listed with International Land Brokers, Inc., and told her he would mail a listing agreement for signature. Arthur Larson signed the agreement and returned it together with his check in the amount of two hundred eighty-five dollars ($285.00). The listing agreement called for the property to be offered at twenty-five thousand dollars (25,000.00), a figure respondent had suggested over the telephone. After entering into the listing agreement, the Larsons received further correspondence from International Land Brokers, Inc., including a proof of a page from a catalogue, on which their property was listed. International Land Brokers, Inc., never communicated to the Larsons any offers to purchase their property.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That the administrative complaint be dismissed. DONE and ENTERED this 26th day of September, 1977, in Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings Room 530 Carlton Building Tallahassee, Florida 32304 COPIES FURNISHED: Mr. Louis B. Guttmann, III, Esquire Mr. Richard J.R. Parkinson, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789 Mr. Walter Penn 1300 Northeast 211th Street North Miami Beach, Florida 33160
