Findings Of Fact Mr. Patterson is currently eligible for licensure and is licensed in this state as a limited surety agent (bail bondsman). At all times material to the Administrative Complaint, Mr. Patterson was eligible for licensure and was licensed in Florida as a limited surety agent (bail bondsman) with Crews Bonding Agency located in Jacksonville, Duval County, Florida. As such, he was a full-time employee of the Crews Bonding Agency and worked the 4:30 p.m. to 8:00 a.m., or night shift, each night. Mr. Patterson was the only licensed bail bondsman on this shift at the Crews Bonding Agency. Ralph Bunch Collins was also a full-time employee of Crews Bonding Agency at all times material, and at all times material, Mr. Collins worked the night shift with Mr. Patterson. Mr. Collins was recognized by Mr. Patterson and his employer as an administrative assistant whose job entailed clerical duties with regard to the bonding process. Mr. Patterson and Mr. Collins worked as a team. Mr. Collins is not a limited surety agent, bail bondsman, runner, or permittee under Chapter 648, F.S. At all times material, Jerelyn Rodriguez, ne' Langtree, was licensed in Florida as a limited surety agent (bail bondsman) with Crews Bonding Agency. She, also, was a full-time employee of that agency and was its designated office manager. Mrs. Rodriquez worked the hours of 8:00 a.m. to 4:30 p.m. daily with an administrative assistant named Mrs. Cook, and together Rodriquez and Cook constituted the Crews Bonding Agency's day shift team. The 1983 version of the statute under which Mr. Patterson is charged in the Administrative Complaint read as follows: 648.441 Furnishing supplies to an unlicensed bail bondsmen prohibited: civil liability and penalty.-- No insurer, bail bondsman, runner, or permittee under this chapter shall furnish to any person any blank forms, applications, stationery, or other supplies to be used in soliciting, negotiating, or effecting bail bonds until such person has received from the department a license to act as a bail bondsman and has duly qualified as such. Any insurer, licensee, or permittee who furnishes to any bail bondsman or other person not named or appointed by `the insurer represented any of the supplies mentioned in subsection (1) and accepts any basil bond business from or writes any bail `bond business for such bail bondsman, person, or agency shall be subject to civil liability to any insured of such insurer to thee same extent and in the same manner as if such bail bondsman or other person had been appointed, licensed, or authorized by the insurer, general agent, or bail bondsman to act in its or his behalf by the department. [Emphasis supplied] On March 27, 1984 a Consent Order was entered in the Circuit Court in and for Duval County, Florida, in the case styled, Jack I. Etheridge and F.G.C. Bonding and Insurance Corporation v. State of Florida and State of Florida Department of Insurance, Case No. 82-10537. That Consent Order provided, in pertinent part, as follows: 4. Florida statute 648.441(1) likewise must be given a liberal and common sense application in order to preserve its constitutionality. It is the intent of the Legislature, as interpreted by this Court that said subsection is designed to prohibit licensed bail bondsmen from allowing non- licensed persons to actually conduct a (sic) legitimate and licensed activities of a licensed bail bondsman. Therefore this Court finds that it is a constitutionally permissable (sic) legislative act to prevent licensed person (sic) from providing non- licensed persons with forms and supplies of the trade that would permit the non-licensed persons to violate the law. However, this does not preclude clerical activities by non- licensed persons under the direct supervision of a licensed person to the extent that it is consistent with the general intent of said section. (Emphasis supplied) [Patterson Exhibit 1] The wife of Jack I. Etheridge, who was a plaintiff in the foregoing civil lawsuit, was an owner of the Crews Bonding Agency at all times material to the instant administrative proceeding. The foregoing Circuit Court Consent Order to which DOI was a party is the only relevant interpretation by a court of competent jurisdiction of Section 648.441 F.S. which either party hereto or the undersigned has been able to discover. DOI put on no expert evidence of agency construction of the statute either formally by rule or informally by policy. Subsequent to that Circuit Court Consent Order, the statute interpreted therein [see FOF 5, supra] was amended to add subsection (3), as follows: Any person who violates this section is guilty of a misdemeanor of the first degree, punishable as provided in s. 775.082 or s. 775.083. All three statutory subsections were in effect at all times material to the administrative charges against' Mr. Patterson. During the night shift of New Year's Eve, December 31, 1988, Susan Miller a/k/a Sharon Miller, who was then the wife of James Edward Miller, contacted the Crews Bonding Agency by telephone and relayed certain necessary information to Ralph Collins as a predicate to securing a bond to get her husband out of the Duval County Jail. In turn, Mr. Collins called the jail and received basic information for making out the necessary bonding papers. Mrs. Miller arrived at the bonding agency and Mr. Collins prepared certain paperwork for her signature, that of her husband, and that of the Mr. Patterson as bail bondsman. It is the unrefuted testimony of Mr. Patterson, Mr. Collins, Jerelyn Rodriquez, and Gilbert Clark that in doing so, Mr. Collins was conforming to the standard operating procedure of the Crews Bonding Agency and the custom in the bonding trade at least as far as that trade has been practiced within Duval County, Florida, since the entry of the March 27, 1984 Consent Order. Patterson Exhibit 2 and the testimony of Correctional Officer Larry Wooten established that, provided the licensed bondsman presents the bond and personally receives the prisoner into his custody, the foregoing clerical practice and procedure has been acquiesced-in by a published policy of the Duval County Sheriff's Office and by county jail personnel, of which Mr. Wooten is one. There was unrefuted testimony that without such clerical help, a licensed bondsman could not function 24 hours a day, as is common in the trade. It is also the unrefuted testimony of Mr. Patterson, Mr. Collins, and Mrs. Rodriquez that at all times material to the Miller transaction, Mr. Collins was subject to the supervision of Mr. Patterson, that Mr. Patterson had the absolute right to alter any document prepared by Mr. Collins prior to signing the Miller bond, and that Mr. Patterson ultimately could have rejected underwriting Mr. Miller's bond if, after Mr. Patterson's review, the documents Mr. Collins had prepared did not conform to the insurance law, rules, or standards to which Mr. Patterson, as a licensee, was bound to conform. The foregoing testimony is further supported by the testimony of Gilbert Clark. Mr. Clark is a licensed bail bondsman who is not now and never has been associated with the Crews Bonding Agency. He testified that Mr. Patterson could ultimately have refused to place the Miller bond even if Mr. Patterson's only dissatisfaction upon his review of the documents prepared by Mr. Collins had been the sufficiency of the collateral or premium provided by the Millers. With regard to the Miller transaction, Mr. Collins prepared the Indemnity Agreement (DOI Exhibit 2e) for signature by Mr. Miller's wife, which Mr. Collins notarized with certificate, seal, and stamp. Collins prepared a Promissory Note (DOI Exhibit 2f) and signed on the line provided for a witness to Mrs. Miller's signature but without applying his notary certificate, seal, or stamp. Collins prepared a Premium Receipt (DOI Exhibit 2g) and signed on the line acknowledging that the premium had been "received by" him in the form of a check from Mr. and Mrs. Miller. The nature of the Premium Receipt and the Collateral Receipt does not necessarily require the Millers' signatures, but Mr. Collins testified that his own signature on the Premium Receipt was meant to signify that he had witnessed signatures and that he had signed it as a notary but that he did not affix a notary certificate, seal, and stamp because he saw no reason for those formalities. Because of the requirements of Chapter 117 F.S. governing notaries public, because the document speaks for itself, and because Mr. Collins testified that he, in fact, received the premium, his testimony that he signed the Premium Receipt for the Miller transaction only as a notary or witness is not credible, particularly since the exhibit (DOI Exhibit 2g) does not bear the Millers' signatures. Mr. Collins prepared the Collateral Receipt (also DOI Exhibit 2g) and received the collateral, signifying same by his signature. (TR 40-41). However, Mr. Patterson signed on the Miller bond and went through all the bond papers, including the foregoing, with Mr. Miller after Mr. Patterson personally physically obtained Mr. Miller's release from jail. On July 7, 1989, Henry A. Robinson went to Crews Bonding Agency in an effort to bond his son, Henry Steve Robinson, out of the Duval County Jail. All of the father's negotiations were with Mrs. Rodriquez. The father did not testify. At all times material to the Robinson transaction, both Mrs. Cook and Mr. Collins had signs on their respective desks, proclaiming them to be administrative assistants, and a sign on Mr. Patterson's desk proclaimed him to be a bail bondsman. When Mr. Patterson and Mr. Collins arrived at Crews Bonding Agency for the July 7, 1989 night shift, some paperwork had already been prepared by Mrs. Rodriquez and others. Mrs. Rodriquez had already reviewed all the papers prepared by someone else, and Mrs. Rodriquez had tentatively committed to underwriting the bond on Henry Steve Robinson. Mr. Patterson did not thereafter "second guess" Mrs. Rodriquez's initial work or judgment despite his absolute right to reject the bond for all the reasons aforesaid in FOF 12. Some further Robinson transaction paperwork was prepared by Mr. Collins after he came on duty. The nature of several of these documents did not require either the signature of the father, the mother, or the son or the notarizing thereof, but the evidence indicates that Mr. Collins thought some of them did. Premium Receipt 127003 (DOI Exhibit 4f, apparently one of two such receipts) and the Collateral Receipt (DOI Exhibit 4b) for this transaction were signed by Mr. Collins on the "received by" lines. He testified that he signed these only as a Crews employee, i.e., a clerk administrative assistant, and as a notary but without affixing his notarial seal. Collins testified that he signed as a witness for the father's signature on the witness line as a Crews employee for the Contingency Promissory Note (DOI Exhibit 4c, TR 48-50), that he did not notarize the note initially when the senior Mr. Robinson signed it in his presence because arrangements were made for the senior Mr. Robinson's convenience to allow Mrs. Robinson to sign the following day, and that the next day, Mr. Collins just witnessed on the other side of that document. However, the documentary evidence (DOI Exhibit 4c) is clear that Mrs. Robinson (the mother) never signed the Contingency Promissory Note. Mr. Collins testified that he signed as a Crews Bonding Agency employee and then notarized with a certificate, seal, and stamp the Indemnity Agreement to the effect that it had been signed by Mr. Robinson's father and mother when in fact the mother never signed that document. (TR 52-56, DOI 4e). Due to the provisions of Chapter 117 F.S., the discrepancy between the exhibits and the testimony, and the vacillation of Mr. Collins in giving his oral testimony, it is found that contrary to Mr. Collins' oral testimony, he was confused or uninformed as to his actual function with regard to the Robinson transaction. However, Mr. Patterson reviewed all the Robinson papers and documents and signed the General Appearance Bond as surety and as attorney-in-fact and an agent of Crews Bonding Agency. Mr. Patterson also personally effectuated Henry Steve Robinson's release from jail on July 7, 1989. Henry Steve Robinson (the son) had been bonded out of the Duval County Jail by the team of Patterson and Collins of the Crews Bonding Agency on at least two occasions, and due to Mr. Robinson's confusion of dates, his testimony concerning exactly what papers he went over with Mr. Patterson or anyone else on July 7, 1989 was somewhat vague. However, he was very clear on some points: Mr. Collins never said he was a bail bondsman, it was Mr. Patterson who signed Robinson out of jail each time, and Robinson signed papers in the bonding agency office each time. Robinson believed that Mr. Patterson was the person who explained all the papers to him in Collins' presence on the date in question, but could not be sure. Mr. Collins and Mr. Patterson asserted that as of the July 11, 1990 formal hearing, Crews Bonding Agency clerical personnel are no longer permitted to sign premium and collateral receipts. This instruction was given in anticipation of amendments to Section 648.441 F.S. which were due to go into effect October 1, 1990. Although Mrs. Miller did not testify, the evidence as a whole from other witnesses supports the reasonable inference that this case arose partly because she complained to DOI when Mr. Collins and other Crews Bonding Agency employees refused to summarily reincarcerate her husband upon her oral complaints of domestic problems. No finding has been made concerning what impression of Mr. Collins was formed by Mrs. Miller or concerning the state of Mrs. Miller's mind because the evidence presented on those issues was speculative and not the type of hearsay which would explain or supplement direct and probative evidence. Neither Mr. Miller or Mr. Henry Steve Robinson appeared to have any complaints with the bonding process or participants.
Recommendation DOAH Case No. 90-0406 Upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Insurance and Treasurer enter a Final Order dismissing the Administrative Complaint. DOAH Case No. 90-0584 Upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Insurance and `Treasurer enter a Final Order granting Mr. Patterson's application for a resident license to represent Amwest Surety Insurance Company as a limited surety agent (bail bondsman). DONE and ENTERED this 17th day of October, 1990, at Tallahassee, Florida. ELLA JANE P. DAVIS, 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 17th day of October, 1990.
The Issue Whether Respondent committed the violations alleged in the Administrative Complaint issued against him in the instant case and, if so, what disciplinary action should be imposed.
Findings Of Fact Based on the evidence adduced at hearing, and the record as a whole, the following findings of fact are made: Respondent Respondent is now, and has been for the past seven years, a Florida-licensed bail bond agent (license number A134458). He is the owner of Big Larry's Bail Bonds (Agency), a bail bond agency located in Broward County, Florida, with which two other Florida-licensed bail bond agents, James Jones (who is Respondent's brother) and Ron Striggles, are affiliated. Count I On April 23, 2002, Hugh Clarke went to the Agency, where he obtained from Respondent a $4,500.00 bail bond for a friend, Richard Dyke, who had been arrested in Palm Beach County, Florida, on a theft charge. To obtain the bail bond, Mr. Clarke had to pay a bail bond premium fee of $450.00 and provide collateral in the amount of $1,050.00. Payment was made by a single check (check number 611) for $1,500.00 made out to the Agency. Mr. Clarke also signed a promissory note, which read as follows: On Demand Hugh McGrath Clarke after date, for value received, I Promise to pay to the order of CONTINENTAL HERITAGE INSURANCE COMPANY Four Thousand Five Hundred DOLLARS, at Big Larry's Bail Bonds, 1310 Sistrunk Blvd., Ft. Laud., Florida[,] [w]ith interest thereon at the rate of 20 percent, per annum[,] from Call Date until fully paid. Interest payable semi-annually. The maker and endorser of this note agrees to waive demand, notice of non payment and protest; and in case suit shall be brought for the collection hereof, or the same has to be collected upon demand of an attorney, to pay reasonable attorney's fees and assessable cost, for making such collection. Deferred interest payment to bear interest from maturity at 20 percent, per annum, payable semi-annually. It is further agreed and specifically understood that this note shall become null and void in the event the said defendant Richard Dyke shall appear in the proper court at the time or times so directed by the Judge or Judges of competent jurisdiction until the obligations under the appearance bond or bonds posted on behalf of the defendant have been fulfilled and the surety discharged of all liability thereunder, otherwise to remain in full force and effect. Respondent provided Mr. Clarke a signed Receipt and Statement of Charges, acknowledging that he had received from Mr. Clarke payment in full for the $450.00 bail bond premium fee. Respondent also presented Mr. Clarke with a pre-printed form entitled "Collateral Receipt and Informational Notice" (Collateral Receipt) that Respondent had filled out and signed (on the appropriate signature line), acknowledging that, on behalf of the surety, Continental Heritage Insurance Company, he had received from Mr. Clarke $1,050.00 as collateral to secure the bail bond that Mr. Clarke had obtained for Mr. Dyke. The Collateral Receipt contained the following "note," "informational notice," and "indemnitor information": NOTE: Unless a properly drawn, executed, and notarized legal assignment is accepted and acknowledged by the surety agent and the surety company named above, the collateral listed above will be returned only to the person(s) named on line (1) above [Mr. Clarke]. Collateral, except for those documents the surety must retain as directed by the law, will be returned within 21 days after the bail bond(s) has been discharged in writing by the court. The undersigned hereby acknowledges receipt of a copy of all collateral documents indicated above, and the Informational Notice printed below. * * * INFORMATIONAL NOTICE CONDITIONS OF BOND: The SURETY, as bail, shall have control and jurisdiction over the principal during the term for which the bond is executed and shall have the right to apprehend, arrest, and surrender the principal to the proper officials at any time as provided by law. In the event surrender of principal is made prior to the time set for principal's appearance, and for reason other than as enumerated below in paragraph 3, then principal shall be entitled to a refund of the bond premium. It is understood and agreed that the happening of any one of the following events shall constitute a breach of principal's obligations to the SURETY hereunder, and the SURETY shall have the right to forthwith apprehend, arrest and surrender principal and principal shall have no right of any refund whatsoever. Said events which shall constitute a breach of principal's obligations hereunder are: If principal shall depart the jurisdiction of the court without the written consent of the court and the SURETY or its Agent. If principal shall move from one address to another without notifying SURETY or his agent in writing prior to said move. If principal shall commit any act which shall constitute reasonable evidence of principal's intention to cause a forfeiture of said bond. If principal is arrested and incarcerated for any other offense other than a minor traffic violation. If principal shall make any material false statement in the application. * * * INDEMNITOR INFORMATION In addition to the terms and conditions of any Indemnity Agreement or other collateral documents which you have executed, this is to notify you that: The Indemnitor(s) will have the defendant(s) forthcoming before the court named in the bond, at the time therein fixed, and as may be further ordered by the court. The Indemnitor(s) is responsible [for] any and all losses or costs of any kind whatsoever which the surety may incur as a result of this undertaking. There should not be any costs or losses provided the defendant(s) does not violate the conditions of the bond and appears at all required court hearings. Collateral will be returned to the person(s) named in the collateral receipt, or their legal assigns, within 21 days after the surety has received written notice of discharge of the bond(s) from the court. It may take several weeks after the case(s) is disposed of before the court discharges the surety bonds. Respondent read to Mr. Clarke that portion of the Collateral Receipt that explained that the collateral would be returned "within 21 days after the surety ha[d] received written notice of discharge of the bond(s) from the court." Nonetheless, for some reason, Mr. Clarke was under the impression that he would be receiving his collateral back within 30 days of April 23, 2002, the date of the transaction, even in the absence of a discharge. In late May 2002, sometime after the 23rd of the month, Mr. Clarke began telephoning the Agency to inquire about the return of his collateral. On each occasion he called, he asked to speak with Respondent, but was told by the person who answered the phone that Respondent was not available. He left messages, but Respondent never returned his calls.2 Mr. Clarke telephoned the Agency approximately twice a month until November 2002, when, frustrated by his inability to reach Respondent by telephone,3 he sent, by facsimile transmission, a letter to the Department of Insurance requesting that it help him in his efforts to gain the return of his collateral. Although Mr. Clarke had been advised in September 2002 by Mr. Dyke that Mr. Dyke's criminal case "was over," Mr. Clarke never got to directly communicate this information to Respondent and to personally ask Respondent to give him back his collateral. Any information Mr. Clarke may have provided about the status of Mr. Dyke's criminal case and any demands Mr. Clarke may have made for the return of his collateral were provided and made to a person or persons at the Agency other than Respondent, who did not communicate them to Respondent. Pat Anthony, a Special Investigator with the Department of Insurance,4 was assigned the task of looking into the allegations Mr. Clarke had made in his letter. Ms. Anthony met with Mr. Clarke on December 6, 2002, and took his statement. The statement was reduced to writing (by Ms. Anthony, who wrote down what she understood Mr. Clarke to have said), and it then was "subscribed and sworn to" by Mr. Clarke. Mr. Clarke's statement read as follows: On 4/23/02, I went to Larry Jones' office to put up bail for Richard Dyke. I gave him a $450 check and a $1,050 check.[5] Richard told me the case was over with in 9/02.[6] I started calling Larry about a week later.[7] He had told me the $450 was his premium and I would get the $1,050 when the case was completed.[8] I have called several times. The man who answered the phone tells me Larry is not there. In January 2003, Ms. Anthony telephoned the Office of the Clerk of the Circuit Court of Palm Beach County (Clerk's Office) to inquire about the status of Mr. Dyke's criminal case. She was told by the person who answered the telephone that the case had concluded and that Mr. Dyke's bond had been discharged, but that there was "no way to know" whether Respondent had been notified of this information inasmuch as the Clerk's Office did not "always notify the out of town bondsman." Ms. Anthony subsequently advised Respondent as to what she had been told and suggested that he go to the Palm Beach County Courthouse to confirm the information she had been provided. Respondent followed Ms. Anthony's suggestion and went to the Palm Beach County Courthouse on January 21, 2003 (which was "within a week" of his conversation with Ms. Anthony). There, he obtained a certified copy (under seal of the Clerk's Office) of a summary or disposition sheet reflecting that Mr. Dyke's bond had been discharged. That same day, when Respondent returned to the Agency, he telephoned Mr. Clarke and made arrangements to have Mr. Clarke come by the Agency on January 27, 2003, to sign paperwork and pick up a check from Respondent for $1,050.00 (the amount of the collateral Mr. Clarke had given Respondent). Mr. Clarke picked up the check on January 27, 2003, as scheduled. It was not until March 2004 that Respondent received from the Clerk's Office a copy of the actual court order discharging Mr. Dyke's bond. Count II On or about September 1, 2002, the Department of Insurance filed a one-count Administrative Complaint (in Department of Insurance Case No. 43742-02-AG) against Respondent, alleging that "he [had] failed to return collateral and charged an amount in excess of the bond premium." On November 13, 2002, the Department of Insurance issued a Consent Order in Case No. 43742-02-AG, which provided as follows: THIS CAUSE came on for consideration and final agency action. Upon consideration of the record including the Settlement Stipulation for Consent Order dated October 25, 2002, and being otherwise advised in the premises, the Insurance Commissioner hereby finds: The Treasurer and Insurance Commissioner, as head of the Department of Insurance, has jurisdiction over the subject matter of this case and parties hereto. The entry of this Consent Order and compliance herewith by the Licensee, LARRY LORENZO JONES, shall conclude the administrative proceeding of Case No. 43742- 02-AG before the Department of Insurance of the State of Florida. IT IS THEREFORE ORDERED: The Settlement Stipulation for Consent Order dated October 25, 2002, is hereby approved and fully incorporated herein by reference; Within thirty (30) days of the date of issue of the Consent Order, pursuant to Section 648.387, Florida Statutes, Licensee shall file[9] notice with the Department of the designated primary agent for each location of all bail bond agencies owned by the Licensee. Failure to file said notice will result in immediate suspension of Licensee's license and eligibility for licensure. Licensee shall be placed on probation for a period of twelve (12) months. As a condition of probation, Licensee shall strictly adhere to the Florida Insurance Code, Rules of the Department and the terms of this agreement. If during the period of probation period [sic] the Department has good cause to believe that Licensee has violated a term or condition of probation, it shall suspend, revoke, or refuse to issue, renew or continue the license of appointment of Licensee. Licensee shall pay a fine of two thousand five hundred dollars ($2500.00) within thirty (30) days of the date of issue of the Consent Order, pursuant to Section 648.52, Florida Statutes. Failure of Licensee to pay the fine within the specified time limit shall result in the immediate suspension of Licensee's license and eligibility for licensure in this state without further proceeding for a period of sixty (60) days. Reinstatement shall be conditioned upon Licensee's compliance with all terms of the Consent Order, including payment of the administrative fine.[10] Sometime in December 2002, Sally Burke, who was then a Bail Bond Coordinator with the Department of Insurance, visited the Agency for purposes of conducting an audit of the Agency's records. Ms. Anthony accompanied her on the visit. During the audit, Ms. Burke asked Respondent if he had completed and "turned in [the] designation form" required by Section 648.387, Florida Statutes. Respondent replied that he had "never received" a blank form to fill out. At Ms. Burke's request, Ms. Anthony handed Respondent a blank designation form. Respondent proceeded to complete it in Ms. Burke's and Ms. Anthony's presence. When he was finished, he attempted to give the completed form to Ms. Burke, but she told him, "Larry, you have to mail it in yourself, but make me a copy for my file." As requested, Respondent made a copy and gave it to Ms. Burke, who, in turn, handed it to Ms. Anthony. He then left the Agency and mailed the original to the Department of Insurance. When he returned to the Agency, Ms. Burke and Ms. Anthony were still there. Months later, in September 2003 at around the time of the issuance of the instant Administrative Complaint, Respondent received a telephone call from Greg Marr, an attorney with Petitioner, who told Respondent that Petitioner had never received his completed designation form.11 Respondent informed Mr. Marr that the completed form had been mailed in December 2002. Mr. Marr responded, "[O]ur records show that it's not in,"12 and asked Respondent to "send in another one," which Respondent did (on or around September 19, 2003). Petitioner received this completed designation form on September 26, 2003.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that Petitioner issue a final order dismissing, in its entirety, the Administrative Complaint issued against Respondent in the instant case. DONE AND ENTERED this 4th day of June, 2004, in Tallahassee, Leon County, Florida. S STUART M. LERNER 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 4th day of June, 2004.
Findings Of Fact The Respondent, Adriana Winkelmann, d/b/a Adriana's Bail Bonds, Tampa, currently is licensed and eligible for licensure in this State as a Limited Surety Agent. On or about October 31, 1986, William L. Counts and his wife, Madie Counts, a/k/a Madie G. Clark, went to see the Respondent about getting Mr. Counts' first cousin, Clayton D. Counts, bailed out of jail. Cousin Clayton was charged with second degree murder, and bail was set on the second degree murder charge at $5000. Clayton Counts also had been charged with eight other counts involving sexual battery on a child and sexual activity with a child under his custodial authority. On October 2, 1986, Clayton Counts had posted $14,000 of bonds that had been set on the eight charges and had been released from jail. Adriana's Bail Bonds, acting as bail bondsman and as attorney-in-fact for the surety company, Accredited Surety And Casualty Company, Inc. (Accredited or the surety), was the surety on the $14,000 of bonds, and Scott Erickson, a friend of Clayton Counts, indemnified Accredited and put up collateral to secure the indemnification agreement. All but $150 of the premium on the $14,000 of bonds had been paid to Adriana's Bail Bonds; Clayton Counts' wife promised to pay the additional $150 at a later date. When Clayton Counts was re-arrested and charged with second degree murder and just an additional $5000 bond was set on the new charge, Erickson became fearful that Clayton Counts might skip the bonds, jeopardizing Erickson's collateral. He told the Respondent that he wanted to be taken off the bonds. At about this same time, on or about October 31, 1986, Mr. and Mrs. William L. Counts came in to Adriana's Bail Bonds, at Clayton Counts' request, to see about bailing out Clayton for the second time. Mr. and Mrs. Counts agreed with the Respondent to indemnify the surety on the total amount of all of the bonds, $19,000. They agreed to pay the $150 balance of the premium on the bonds put up on or about October 2, 1986, on the first set of charges, plus a $500 premium on the bond put up on or about October 31, 1986, on the second degree murder charge. The indemnity agreement was to indemnify the surety company for the entire $19,000 amount of the bonds in the event of a forfeiture, plus "all claim, demand, liability, cost, charge, counsel fee, expense, suit order, judgment, or adjudication" sustained or incurred by the surety company. As collateral to secure their indemnity agreement, Mr. and Mrs. Counts put up their mobile home, to which they gave the Respondent a power of attorney dated October 31, 1986, and an $8,000 mortgage on a lot worth approximately $8000. They also gave Adriana's Bail Bonds a $19,000 promissory note as collateral. On October 31, 1986, an employee of Adriana's Bail Bonds gave Mr. Counts a collateral receipt, signed by Mr. Counts and the employee, for the $19,000 promissory note, the indemnity agreement, the mortgage on the lot and the mobile home. The original was given to Mr. Counts and Adriana's Bail Bonds kept a copy. There was no evidence that the collateral receipt, or any other statement or affidavit, for this or any other collateral (other than Erickson's original collateral on the $14,000 of bonds on the first set of charges) ever was filed anywhere. Mr. Counts paid $500 by check dated November 14, 1986, for the premium on the $5000 second degree murder bond. In December 1986, Clayton Counts left the state and missed a court appearance on December 19, 1986. The $19,000 of bonds was estreated. In about January 1987, Mrs. Counts went to see the Respondent about substituting some other collateral for the mobile home. She was concerned about where she and her husband would live if the bonds were estreated and forfeited and the mobile home had to be sold to perform the indemnity agreement. She wanted to be able to move the mobile home somewhere else even in that event. After some discussion, it was agreed that the Respondent would accept $6000 cash as substitute collateral in place of the mobile home. Mrs. Counts promised to pay the $6000 in installments of approximately $500 a month. The Respondent repeatedly was able to have the court delay forfeiture of the bonds because she was able to demonstrate that she was trying to locate and return the defendant to the court. In her efforts, the Respondent incurred expenses for hiring private investigators, for a six- day trip to Missouri, for long distance telephone charges, for attorneys' fees for getting postponements of the forfeiture of the bonds and for other miscellaneous expenses. The Respondent collected portions of the promised cash collateral substitution in the following installments, some of which were picked up at the Counts' home by the Respondent: April 21, 1987 $2,000 July 17, 1987 $ 300 August 10, 1987 $ 500 August 20, 1987 $ 800 January 6, 1988 $ 500 On each occasion, the Respondent gave Mrs. Counts a collateral receipt signed by the Respondent and by Mrs. Counts. Each receipt noted the amount received, the balance due on the cash collateral substitution promise, and the $150 balance on the premium on the October 2, 1986 bonds on the first set of charges. Again, there was no evidence that any of these collateral receipts were "filed" anywhere. On January 6, 1988, Mrs. Counts asked the Respondent for a summary of the amounts of collateral paid to that date. The Respondent wrote on a piece of paper, incorrectly dated January 6, 1987, that $4100 had been received to date. Mrs. Counts also was confused what the money would be used for. The Respondent answered her question, saying that the money, together with the lot, would go towards indemnifying the surety for the $19,000 amount of the bonds if they were forfeited and, under the indemnity agreement, could be used to indemnity Adriana's Bail Bonds for expenses caused by the estreature. The Respondent listed these items on a piece of paper, too: Attorney fees to continue case 4 times over one year. Long distance calls for one year. Gas, stamps, & miscellaneous. One trip to Missouri, gas, motel, meals. Investigators services in Missouri and Florida. Later in January 1988, Clayton Counts was arrested and returned to Florida. The bonds, however, were not discharged at that time. Later in 1988, the Respondent made demand on Mrs. and Mrs. Counts for payment of an additional $2,150. This was supposed to represent $2000 due on the cash collateral substitution promise, plus the $150 balance on the premium on the October 2, 1986 bonds on the first set of charges. In fact, only $1900 was due and owning on the cash collateral substitution agreement. In March and April 1988, the Respondent collected from Mrs. Counts two additional $350 installments of the cash collateral substitution promise. Only one receipt was given for both installments, once again signed by both the Respondent and Mrs. Counts, reducing the balance to $1200, plus the $150 premium owing. In June and July 1988, Mrs. Counts was hospitalized. On June 13, 1988, the Respondent went to the hospital to have Mrs. Counts sign a receipt for the return of the original collateral for the $19,000 of bonds--i.e., the $19,000 promissory note and indemnity agreement, the mortgage on the lot and the mobile home. The Respondent did not return the cash collateral. On July 14, 1988, the court entered an order releasing the surety and Adriana's Bail Bonds from the bonds. The Respondent did not return the cash collateral because Mrs. Counts died in July 1988, and the Respondent was unsure to whom the money should be paid.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Respondent be found guilty of the violations set forth in the Conclusions of Law portion of this Recommended Order and that her license and eligibility for licensure be suspended for a period of thirty (30) days, that she be required to pay an administrative fine in the amount of $250, and that she be placed on probation for nine months after expiration of the suspension period, conditioned on : (1) successful completion of either a basic certification course or a correspondence course approved by the Bail Bond Regulatory Board; and (2) payment of the cash collateral to the rightful owner, or in the alternative, if the Respondent is in doubt as to the rightful owner, into a court registry in conjunction with an interpleader action, within 30 days of entry of final order. DONE and ENTERED this 24th day of February, 1989, in Tallahassee, Leon County, Florida. J. LAWRENCE JOHNSTON Hearing Office 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 24th day of February, 1989. APPENDIX TO RECOMMENDED ORDER CASE NO. 88-2588 To comply with Section 120.59(2), Florida statutes (1987), the following rulings are made on the Petitioner'S proposed findings of fact: 1-9. Accepted and, along with other facts, incorporated. 10. Rejected in part and accepted in part. The note was a receipt of sorts, but it was not the only receipt. The incorrect date on the "receipt" was January 6, 1987; the actual date the "receipt" was given was January 6, 1988. 11.-16. Accepted and incorporated. COPIES FURNISHED: S. Marc Herskovitz, Esquire Office of Legal Services Department of Insurance 412 Larson Building Tallahassee, Florida 32399-0300 Don Dowdell General Counsel Department of Insurance and Treasurer The Capitol, Plaza Level Tallahassee, FL 32399-0300 James N. Casesa, Esquire 3845 Fifth Avenue North St. Petersburg, Florida 33713 The Honorable Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, Florida 32999-0300
The Issue Whether the Respondent's license as a limited surety agent should be suspended, revoked or otherwise disciplined based upon the allegations set forth in the Administrative Complaint.
Findings Of Fact Background At all times material to these proceedings, Respondent Harris was licensed as a limited surety agent and continues to be eligible for licensure and appointment in Florida. On June 2, 1988, Respondent executed a bail bond agreement with Indiana Lumbermen's Mutual Insurance Company (Indiana Lumbermen's) as the insurer of the surety bonds, Underwriters Surety, Inc. (Underwriters) as its agent, and Jim Fowler, Jr. d/b/a Fowler Enterprises (Fowler) as its representative indemnitor and supervising representative. Under the terms of the agreement, Indiana Lumbermen's agreed to act as surety on bail bonds solicited and signed in its name by Respondent Harris. In turn, he agreed to charge, collect and remit all bond premiums through Fowler, who has a separate agreement with Indiana Lumbermen's and Underwriters regarding those duties. Additionally, Respondent agreed to hold Indiana Lumbermen's, Underwriters, and Fowler harmless for all bond forfeitures and court costs expended by any of them for bail bonds issued in Indiana Lumbermen's name by him. Because Fowler was also required to indemnify Indiana Lumbermen's and Underwriters against bond forfeitures and court costs resulting from bonds issued by Respondent Harris, a $10,000 mortgage was placed against Respondent's home as collateral for such losses by Fowler. Indiana Lumbermen's and Underwriters also required Respondent Harris to place two per cent of the face amount of each bond in an indemnity fund. The agreement states that after each indemnification is finally determined and satisfied, the remaining portion of the indemnity fund will be delivered to the Respondent or to Fowler. Fowler and the Respondent agreed that when the indemnity fund built up to $25,000.00 in reserved funds, Fowler would release the mortgage. Respondent could also request that the amount of money he was required to place into the indemnity fund for subsequent bond executions be reduced to one per cent of the face of the bonds. After the bail bond agreement was executed by all parties and the Respondent's wife in June of 1988, the bail bonds service office was opened in Tampa, Hillsborough County, Florida. Bond Forfeitures On December 12, 1988, two final judgments were entered in Hillsborough County which required the forfeiture of Surety Bond Power No. BB1-168638 and No. BB1-168639 due to the failure of Charles Douglas, Jr., to appear to answer criminal charges for which the bonds had been issued. Each bond was in the principal amount of $1,000.00 and was issued by Respondent Harris as Attorney- In-Fact for Indiana Lumbermen's. The sum of the two judgments was $2,000.00 and $169.00 and court costs. Warren H. Dawson, attorney for the Defendant, motioned the court to vacate the judgments on January 24, 1989. Instead vacating the judgments, the court stayed the enforcement of the judgments until April 26, 1989. At the chose of the time period, Charles Douglas, Jr., was not located, ad the bond funds were forfeited to the State of Florida for the use and benefit of Hillsborough County. These funds, totalling 2,000.00, were paid to the Clerk of Court by Harry Hamner Enterprises on May 18, 1989, as agent for Fowler. Court costs of $84.50 were paid by Respondent Harris, and $84.50 in court costs remain outstanding. The funds paid to the Clerk of Court on behalf of Fowler were issued to a low Fowler to comply with the bail bond agreement as super representative. Respondent Harris is still obligated to indemnify Fowler for the payment. On December 3, 1990, a remittance of $1,000.00 was given to Fowler because Defendant had been located. As this hearing took place only three days later, it is unknown if a check for the other S1,000.00 was forthcoming to Fowler. If the failure to remit the owner $1,000.00 was an oversight, it could be easily corrected by the Clerk of Court as the location of the Defendant would allow we return of these funds as well. On June 4, 1989, a final judgment was entered in Hillsborough County which required the forfeiture of Surety Bond Power No. BB1-200214 due to the failure of Ivan R. Jacob to appear in court to answer the criminal charges for which the bond had been issued. The bond was in the principal amount of $1,000.00 and was issued by Respondent Harris as Attorney-In-Fact for Indiana Lumbermen's. The judgment was for $1,000.00 and $84.50 in court costs. Warren H. Dawson, attorney for the Defendant, motioned the court to vacate and set aside the judgment and costs on July 12, 1989. The motion was granted on August 24, 1989, except that the payment of $84.50 in court costs was still required. The outstanding court costs of $84.50 were paid by Rubin C. Bazarte, Bail Bonds, on behalf of Indiana Lumbermen's on August 28, 1989. Respondent Harris has not indemnified Indiana Lumbermen's for those funds expended to pay the court costs as required by the bail bond agreement. He is still obligated to do so. On June 14, 1989, a final judgment was entered in Hillsborough County which required the forfeiture of Surety Bond Power No. BB1-197205 due to the failure of William A. Evans to appear to answer criminal charges for which the bond had been issued. The principal amount of the bond was $500.00. It was issued by Respondent Harris as Attorney-In-Fact for Indiana Lumbermen's. The sum of the judgment was $500.00 with court costs of $84.50. The judgment and court costs were satisfied by Rubin C. Bazarte, Bail Bonds, on behalf of Indiana Lumbermen's on August 28, 1939. Respondent Harris has not indemnified Indiana Lumbermen's for the funds expended, as required by the bail bond agreement. On June 21, 1989, a final judgment was entered in Hillsborough County which required the forfeiture of Surety Bond Power No. BB1-197204 due to the failure of Williams A. Evans, Jr., to answer criminal charges for which the bond had been issued. The principal amount of the bond was $500.00, and it was issued by Respondent Harris as Attorney-In-Fact for Indiana Lumbermen's. The sum of the judgment was $500.00 plus court costs of $84.50. On August 28, 1989, the judgment and court costs were satisfied by Rubin C. Bazarte, Bail Bonds, on behalf of Indiana Lumbermen's. Respondent Harris has not indemnified Indiana Lumbermen's for the funds expended, as required by the bail bond agreement. Respondent has not received funds to pay for the bond forfeitures from any source. Bond Net Premiums As part of his duties regarding the issuance of bonds for Indiana Lumbermen's, Respondent was required to regularly report the execution of bail bonds to Fowler and Underwriters. The net premiums were to be paid to either of these agents for Indiana Lumbermen's. According to the business records maintained by Fowler, the Respondent failed to remit the required net premiums owed with reports numbered 35, 36, 37 and 38. The amount of money owed for these premiums is $2,370.00. For April 7, 1989, Rosettia Jacobs paid Respondent $1,000.00 to obtain two bonds for the pretrial release of her son, Andre Hudson. Two bonds, with a face value of $5,000.00 each were executed by Respondent that day. The net premiums for two bonds with a face value of $10,000.00 were listed on bail bond execution report number 36, but the net premium was never paid to Fowler or Underwriters from the cash received from Rosettia Jacobs for that purpose. In July 1989, Melvin Rolfe met with Respondent's son, who represented he could accept funds on behalf of his father for the bail bond business. Melvin Rolfe gave Respondent's son $250.00 for a bail bond in order to obtain the pretrial release of his brother, Joseph Rolfe. Of these funds, $100.00 was for payment of the gross premium and $150.00 was collateral. The bond for $1,000.00 was executed by Respondent on August 1, 1989. The collateral given to Respondent's son was not noted on bail bond execution report number 35. The net premium for the $1,000.00 bond for Joseph Rolfe was not sent to Fowler or Underwriters from the cash delivered by Melvin Rolfe for that purpose. On August 1, 1989, Melvin Hamilton gave the Respondent $250.00 for two bonds in order to obtain the pretrial release of his brother, Mark Hamilton. One bond premium was $100.00 and the other bond premium was $50.00. The additional $100.00 was collateral. Bonds with the total face value of $1,250.00 were executed by Respondent on August 1, 1989. The collateral was not noted on the bail bond execution report number 35, and the net premiums were not sent to Fowler or Underwriters from the funds delivered by Melvin Hamilton for that purpose. On August 4, 1989, Charles Rodriguez paid $350.00 for bond premiums to Respondent in order to obtain the pretrial release of his wife, Tina Dunn. The total gross premium amount was $450.00. Respondent extended credit to Charles Rodriguez and issued three bonds with the total face value of $4,500.00 on August 4, 1989. Although the bonds were issued and noted on bail bond execution report 35, the net premiums were not sent to Fowler or Underwriters from the funds delivered by Charles Rodriguez for that purpose. On September 13, 1989, Fowler, as supervising representative for Indiana Lumbermen's and Underwriters, sent a formal demand to Respondent for the $2,370.00 due for premiums not included with reports numbered 35-38. Respondent has failed to pay any of the funds actually received for those premiums to Fowler, Underwriters, or Lumbermen's. Mitigation Respondent has made some attempts to locate defendants whose bonds have been forfeited to the state. Respondent extended credit to some people seeking bail bonds so he never collected some of the money owed to Indiana Lumbermen's for premiums.
Recommendation Based upon the foregoing, which demonstrates that Respondent misappropriated net bond premiums owed the insurer on four occasions between April and early August 1989, it is RECOMMENDED: The limited surety license of Rudolph Harris, Respondent, be suspended for one year, pursuant to Section 648.49(1), Florida Statutes [1987]. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 22nd day of February 1991. VERONICA E. DONNELLY 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 22nd day of February, 1991. APPENDIX TO RECOMMENDED ORDER CASE NO. 90-4689 Petitioner's proposed finding of fact are addressed as follows: Accepted. See HO #1. Accepted. See HO #1. Rejected. Contrary to fact. See #18-#23. Also, irrelevant as to charging document which claimed Respondent misappropriated bond forfeiture funds. Rejected. Irrelevant as to charging document which claim Respondent misappropriated forfeiture funds. See HO $14-#17. Rejected. Contrary to fact. See HO #8-#13. Accepted. See HO #35. COPIES FURNISHED: Gordon T. Nicol, Esquire Department of Insurance 412 Larson Building Tallahassee, FL 32399-0300 Rudolph Harris 812 E. Henderson Avenue Tampa, FL 33602 Tom Gallagher State Treasurer and Insurance Commissioner The Capitol, Plaza Level Tallahassee, FL 32399-0300 Bill O'Neil General Counsel Department of Insurance and Treasurer The Capitol, Plaza Level Tallahassee, FL 32399-0300
The Issue The issue to be resolved in this proceeding concerns whether the Respondent's bail bond agent's License issued by the State of Florida should be subjected to sanctions for alleged violation of certain provisions of Chapter 648, Florida Statutes, and related rules, as described in the First Amended Administrative Complaint.
Findings Of Fact The Petitioner is an agency of the State of Florida charged by statute and rule with regulating the entry to licensure, and regulating the practice, of bail bond agents such as the Respondent. The Respondent Donald Frank Shirey was, at times pertinent hereto, a licensed bail bond agent regulated by the Department. The Respondent was a corporate officer and director of Donald Shirey and Associates, Inc., located, at times pertinent hereto, at 112 East Adams Street, Jacksonville, Florida ("Associates"). It was an entity engaged in the bail bond business. The Respondent employed Robert Meyers, James Kinard and Michael Suttles as licensed bail bond agents. Count I On September 25, 1998, Darryl Gerald Irving was incarcerated in the Duval County Jail. The amount of his bond was set at $5003.00, with a premium of $500.00. On that date, the Respondent posted a bail bond for Darryl Gerald Irving. After bonding Mr. Irving out of jail, the Respondent took him to Mr. Irving's former employer, Target, to obtain a check (number 8215734), in the amount of $172.23. The check was signed over to the Respondent as partial payment for the bail bond premium. The Respondent and Mr. Irving then went to the Respondent's office were they called Mr. Irving's girlfriend, Sandra Jennings, who paid the remainder of the bond premium. Mr. Irving then completed Petitioner's Exhibit 3, at the Respondent's office. On this document he listed his address as 3273 University Boulevard, Apartment 244. The address listed on his driver's license is 3273 University Boulevard, Apartment 255. The address listed on his Target check stub is 1706 Art Museum Drive, Apartment G-11. Mr. Irving explained that he would be living at 3273 University Boulevard, Apartment 244, and that the addresses on his driver's license and check stub were prior addresses. The Respondent, however, alleged that Mr. Irving put an incorrect or non-existent address on the document (Petitioner's Exhibit 3), but he never verified that. The Respondent surrendered Mr. Irving back to the Duval County Jail, terminating his liability on the bond, on the theory that Mr. Irving had entered an incorrect address on the document, Petitioner's Exhibit 3; the address he where he would be living, instead of his driver's license address or the address appearing on the check stub from his employer. On this basis, the Respondent returned him to the Duval County Jail for incarceration and retained the $500.00 bond premium paid by Mr. Irving. From the time the Respondent bonded Mr. Irving out of jail until the time he surrendered him back to jail, Mr. Irving remained in the Respondent's custody. Mr. Irving was in handcuffs except for the time when he was completing the written bond documents. At no time was Mr. Irving free to leave the Respondent's custody. Count II On January 8, 1998, the Respondent posted a bail bond for Patrick Andrade in the amount of $3,656.00. The bond premium thereon was $365.60, which was paid by Mr. Andrade. The documents marked as Petitioner's Exhibit 6, were completed and signed by Mr. Andrade. After being bonded out of jail, the Respondent took Mr. Andrade to the Respondent's home. While there he engaged in sexual relations with Mr. Andrade. When Mr. Andrade was no longer willing to engage in sexual relations with the Respondent, the Respondent surrendered him back to jail for re-incarceration and retained the bond premium. Count III On February 14, 1998, the Respondent posted a bail bond for Patrick Andrade in the amount of $50,003.00. The bond premium was $5,003.00. Mr. Andrade paid $2,500.00, as a down payment and paid an additional $1,200.00, of the bond premium for a total of $3,700.00, before being surrendered back to jail by the Respondent. The documents marked as Petitioner's Exhibit 7 in evidence, were completed and signed by Mr. Andrade. After being bonded out of jail, Mr. Andrade was taken by the Respondent to the Respondent's home where he spent several days and engaged in sexual relations with the Respondent. On February 25, 1998, when Mr. Andrade was no longer willing to engage in sexual relations with the Respondent and wished to go home to his wife, the Respondent surrendered Mr. Andrade to the Clay County Jail for re-incarceration and again retained the bond premium. Count IV On September 24, 1998, the Respondent again posted a bond for Mr. Andrade in the amount of $1,502.00. The bond premium of $150.20 was paid by Mr. Andrade and he signed the documents in evidence as Petitioner's Exhibit 8. After being bonded out of jail, Mr. Andrade was again taken to the Respondent's home where he stayed for several days and engaged in sexual relations with the Respondent. Thereafter, when Mr. Andrade wished to go home to his wife the Respondent instead surrendered him to the Clay County Jail and retained the bond premium already paid. Count V Ms. Jeanette Alzola met with the Respondent at his office on April 7, 1999, and entered into an agreement with the Respondent to provide for the bond of Pabel Romero Martinez from incarceration in the Lee County Jail in Fort Myers, Florida. Mr. Martinez's bond was $150,000.00. Ms. Alzola paid a premium of $15,000.00, and a transfer fee of $100.00. She posted the Deed for her house and the title to her car as collateral for the bond. When Ms. Alzola met with the Respondent she explained that Mr. Martinez would be living with her at her residence. She also told the Respondent that Mr. Martinez had difficulties comprehending English and would need assistance completing the required documents. She requested that Mr. Shirey contact her when Mr. Martinez was brought to the Respondent's office so that she could function as a translator and assist him in completing the documents. On April 9, 1999, the Respondent went to the Lee County Jail and posted a bond for Mr. Martinez to remove him from the jail. He brought him back to Jacksonville, Florida. He was in handcuffs the entire time except for a short period of time when he was completing the relevant bond documents. Mr. Martinez explained to the Respondent that he would be living with Ms. Alzola. The Respondent held up Mr. Martinez's driver's license and told him to "copy this address onto there." Mr. Martinez listed an address on the application that was not Ms. Alzola' s address or the address that appears on his driver's license, but it was the address of his previous residence. The Respondent then said that he was going to surrender Mr. Martinez back to the jail "now that we have good cause that I can go by and check this address because the address is a lie." The Respondent then surrendered Mr. Martinez back to the Lee County Jail without ever releasing him from his custody and retained the $15,100.00, that had been paid by Ms. Alzola. Ms. Alzola filed a civil lawsuit against the Respondent in which she obtained a Judgment in the amount of $15,100.00. The Court therein concluded that the: Decision to return him (Martinez) to the Lee County Jail within a few hours of bringing him here without ever releasing him or turning him over to the custody of the plaintiff (Alzola) constituted a breach of their contract with the plaintiff. The acts of the defendants herein did not constitute a "release" of Mr. Martinez anymore than if they had merely transferred him from the Lee County Jail to the Duval County Jail and back. Mr. Martinez remained in the custody of at least two of the defendants' agents at all times. Nothing in the acts or statements of these agents would have indicated to a reasonable person that he was free to leave their custody. In fact, their conduct was a clear indication that Mr. Martinez was still in a custodial status. Count VI Janice Smith met with the Respondent on May 27, 1999, to arrange for a bail bond for her seventeen-year-old son Kevin Smith. Kevin Smith was incarcerated in the Duval County Jail in Jacksonville, Florida. His bond amount was $100,000.00, and the premium on that bond was $10,000.00. Ms. Smith paid $7,000.00 of the premium and entered into a premium agreement for the remaining balance of $3,000.30. Under the terms of the agreement she was to make monthly payments of no less than $300.00 until the balance was paid. The balance was due before discharge of the bond. The Respondent held the title to Ms. Smith's 1999 Chevrolet Lumina as collateral security on the loan. The Respondent told Ms. Smith that he would help her out with any problem that she might have with Kevin. On or about May 31, 1999, she called the Respondent and told him that she was concerned because Kevin was coming home after a curfew that she had set for him. On June 1, 1999, the Respondent called Ms. Smith and recommended that Kevin be surrendered back to the jail for a few days in effect, to teach him a lesson. The Respondent assured Ms. Smith that he would get Kevin out of jail at any time without incurring additional costs. She agreed to allow the Respondent to surrender Kevin back to the jail with the understanding that she could get Kevin out of jail at any time without any additional costs. On June 1, 1999, the Respondent and several of his agents arrived at Ms. Smith's home. At the time of their arrival, Kevin Smith was not at home. The Respondent went into the house with Ms. Smith and two or more of his employees positioned themselves outside the house and waited for Kevin to return home. Kevin Smith approached the house in his vehicle and noticed several cars near his house. He purportedly believed that they belonged to a neighborhood gang which he had had problems with in the past. Allegedly fearing for his safety, he turned in his vehicle and proceeded to drive away. The Respondent's agents tried unsuccessfully to block his retreat with their vehicles and then pursued him but were unable to catch him. Janice Smith then called Kevin on his cell phone to ask him why he left. He replied that he thought the individuals at the house were gang members. Ms. Smith told him that it was just the Respondent and his agents who wanted Kevin to sign some papers. Kevin thereupon went home and attempted to shake the Respondent's hand whereupon the Respondent handcuffed and shackled him and took him back to his office. The Respondent later surrendered him to the Duval County Jail. A few days later, Janice Smith contacted the Respondent and requested that he bond Kevin back out of jail. The Respondent said he would not bond Kevin out of jail until Janice Smith provided proof that Kevin's car had been placed in storage. Ms. Smith put the car in storage and brought the receipt to the Respondent's office. The Respondent still would not bond Kevin out of jail. Ms. Smith went to the Respondent's office on numerous occasions and he refused to meet with her. Ms. Smith made several telephone calls to the Respondent but he would not take or return her calls. After several days had passed, one of the Respondent's employees told Ms. Smith that the Respondent would not bond Kevin out of jail and would not refund the premium payments. In June 1999, when Ms. Smith attempted to purchase a tag for her 1999 Chevrolet Lumina, she learned that the Respondent had transferred the vehicle to his name. The Respondent claimed that that action was taken pursuant to the terms of the premium agreement. However, the Respondent never notified Ms. Smith that the balance was due in full, or of his intent to transfer title of the vehicle to his name. Ms. Smith paid the Respondent the $3,000.00 balance so that the Respondent would release the title to her vehicle, which he did. Ms. Smith paid a total of $10,000.00, as a bail bond premium to the Respondent. The Respondent surrendered Kevin back to the jail but refused to bond him back out of jail as he had previously agreed and he also refused to refund the premium to Ms. Smith.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses and the pleadings and arguments of the parties, it is, therefore, RECOMMENDED that a final order be entered by the Department of Insurance revoking the Respondent's license and eligibility for licensure as a bail bond agent, and that the Respondent be found ineligible to apply for licensure with the Department for a minimum period of two years and not until such time as restitution is made to Darryl Irving in the amount of $500.00, Patrick Andrade in the amount of $4,215.80, Jeannett Alzola in the amount of $15,100.00 and Janice Smith in the amount of $10,0003.00. DONE AND ENTERED this 21st day of October, 2002, in Tallahassee, Leon County, Florida. P. MICHAEL RUFF 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 Clerk of the Division of Administrative Hearings this 21st day of October, 2002. COPIES FURNISHED: Richard J. Santurri, Esquire Department of Insurance Division of Legal Services 200 East Gaines Street Tallahassee, Florida 32399-0333 Donald Frank Shirey, Jr. 5337 107th Street Jacksonville, Florida 32244 Honorable Tom Gallagher State Treasurer/Insurance Commissioner The Capitol, Plaza Level 02 Tallahassee, Florida 32399-0300 Mark Casteel, General Counsel Department of Insurance The Capitol, Lower Level 26 Tallahassee, Florida 32399 0307
The Issue Whether Respondent's license as a limited surety agent should be revoked or the licensee otherwise disciplined for alleged violations of Chapter 648, Florida Statutes, and Chapter 4-1, Florida Administrative Code, as set forth in the Administrative Complaint dated October 16, 1979. In this proceeding, Petitioner seeks to take disciplinary action against Respondent for various alleged violations of Chapter 648, Florida Statutes, and Chapter 4-1, Florida Administrative Code, arising out of alleged irregularities in connection with a bonding transaction in 1978. Two witnesses testified for the Petitioner and the parties stipulated to the admission of seven documentary exhibits. The Respondent testified in his own behalf at the hearing.
Findings Of Fact Respondent Timothy Michael Paletti is currently licensed as a limited surety agent to represent Cotton Belt Insurance Company, Inc., at Orange Lake, Florida, and was so licensed during the periods alleged in the Administrative Complaint. (Petitioner's Exhibit 1, Stipulation) On November 23, 1978, Respondent executed an appearance bond in the Gilchrist County Circuit Court in the sum of $10,000 as agent of the surety, Cotton Belt Insurance Company, in behalf of Rodney D. Lovett, who was charged with robbery. Respondent did not attach either an affidavit or statement, as prescribed in Rule 4-1.14, Florida Administrative Code, to the bail bond at the time it was filed in the office of the Circuit Court clerk. It was not until January 31, 1979, that Respondent filed a statement concerning collateral security for the bond under Rule 4-1.141 in lieu of the affidavit required by Rule 4-1.14, F.A.C. Lovett's wife paid a $1,000 premium for the bond and his sister-in-law, Deborah Johnson, executed a demand note for $10,000, together with a mortgage deed on a dwelling which she owned in Deland, Florida, on November 23, 1978, as collateral security for the bond. During the transaction, Respondent provided Johnson with a business card bearing his Orange Lake telephone number. (Testimony of Johnson, Petitioner's Exhibits 2-4) On January 8, 1979, a Notice of Sentencing was issued by the Gilchrist County Circuit Court Clerk in Lovett's case for January 22, 1979 at Trenton, Florida. On January 13, Respondent contacted Lovett and Johnson by telephone at their respective homes and advised them of the date of the required court appearance. (Testimony of Respondent, Petitioner's Exhibit 5) During January 1979, Lovett and his wife talked to Johnson about the possibility of "leaving and not going to court." Johnson became concerned about these disclosures and attempted to reach Respondent at his Orange Lake telephone number. Numerous calls to that number on January 15th were unanswered. After unsuccessful attempts to reach Respondent through the Cotton Belt Insurance Company and at another telephone number provided by Petitioner, Respondent finally called Johnson's house on January 20, at which time Johnson and a friend, Barry S. Beatty, told Respondent about Lovett's statements concerning his intentions and requested that Respondent pick up Lovett and surrender him to court so the collateral security could be released. Respondent told Johnson that he would look into the matter. He then telephoned Lovett's attorney and the Lovett home, and was assured that everything was all right. (Testimony of Johnson, Beatty, Respondent) On January 22, 1979, Lovett failed to appear at court for sentencing and the bond was therefore declared to be forfeited. Respondent and law enforcement authorities there after made efforts to locate Lovett and he was eventually apprehended and sentenced to confinement. On July 2, 1979, the Gilchrist County Circuit Court ordered that the bond previously estreated be remitted less the cost expended by the State in apprehending the defendant in the amount of $500. The collateral security posted by Johnson is still outstanding due to a dispute over costs sought by Respondent. (Testimony of Johnson, Respondent, Petitioner's Exhibit 6-7) Respondent testified at the hearing that he felt he had made reasonable efforts to assure that Lovett would appear in court. Although Respondent moved his office in late January 1979, his office phone was in operation and his office was open during the week of January 15-22. (Testimony of Respondent)
Recommendation That the charges against Respondent Timothy Michael Paletti be DISMISSED. DONE and ORDERED this 9th day of July, 1980, in Tallahassee, Florida. THOMAS C. OLDHAM Hearing Officer Division of Administrative Hearings 101 Collins Building Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of July, 1980. COPIES FURNISHED: S. Strom Maxwell, Esquire Department of Insurance 428-A Larson Building Legal Division Tallahassee Florida 32301 Robert J. Costello, Esquire Bates and DeCarlis - Suite B 726 Northwest Eighth Avenue Gainesville, Florida 32601
Findings Of Fact The Respondent, Russell Lynn Tull, became licensed in this state as a general lines agent on January 21, 1989. At the time of the events which gave rise to the Administrative Complaint, the Respondent was not licensed as an insurance agent. At all times pertinent to the Administrative Complaint, the Respondent was employed by Cecil Powell and Company of Jacksonville, Florida, in its surety bond department. Cecil Powell and Company was authorized to underwrite performance surety bonds on behalf of Transamerica Insurance Company. On or about September 20, 1988, Embry/Burney, Inc. (hereafter E/B) of Fernandina Beach, Florida, entered into a construction contract with C and W Systems of Jacksonville, (hereinafter C and W), pursuant to which C and W agreed to build certain improvements for E/B within a development located in Nassau County, Florida. The construction contract provided that E/B, as owner, would pay C and W, as contractor, the sum of $765,668 upon completion of the project, and further that C and W would provide a performance bond in the amount of the contract. On or about September 20, 1988 and pursuant to contract, E/B provided a check in the amount of $15,232 payable to C and W as full payment on the premium for the performance bond on the construction project. On or about October 20, 1988, E/B received a performance bond from C and W in the amount of $765,668 to ensure completion of the construction contract. The performance bond was received by W. H. Burney, Jr., in behalf of E/B. The performance bond listed William Whiddon, Paul Chauncey, and the Respondent as personal sureties on the performance bond. Whiddon and Chauncey were the principals in C and W Contracting. When W. H. Burney, Jr. received the personal surety bond he asked Chauncey and Whiddon where they had obtained it. Burney was told by Chauncey that it was obtained through Cecil Powell and Company. Chauncey also told Burney that the Respondent was a Vice-President with Cecil Powell and Company. (The preceding is a hearsay statement included in these findings to explain the state of mind of W. H. Burney, Jr. as stated below.) C and W gave the check provided by E/B for the performance bond to the Respondent who deposited the $15,232 to his personal account. C and W presented the personal surety bond to the local government to meet its requirements for participation. W. H. Burney, Jr. knew that the surety bond which he received was a personal surety bond from Whiddon, Chauncey, and the Respondent; however, Burney thought that their personal obligations had been re-insured by Transamerica based upon statements he received from Chauncey. W. H. Burney, Jr., never spoke to the Respondent in person. All of his conversations with the Respondent were by telephone. Burney testified that the Respondent told him that the re-insurance was through Transamerica Insurance Company; however, his testimony on this point was not deemed to be credible. (Not accepted as Finding of Fact.) 1/ Subsequently, W. H. Burney, Jr. received a letter on the stationery of Cecil Powell and Company, Petitioner's Exhibit No. 5, which reinforced Burney's misconception that Chauncey, Whiddon, and Tull had re-insured the project through Transamerica Premier Insurance Company. Neither Transamerica nor any other company wrote any insurance guarantying the performance of the contract by C and W. On or about April 13, 1988, C and W failed to complete the work as required by the contract, and the contract was declared in default. After the default on the contract, Joel E. Embry contacted the Respondent at Cecil Powell and Company and discussed with him the default, the need to activate the bond, and the need to hire a new contractor to complete the work. Embry suggested two contractors to the Respondent which the Respondent indicated were acceptable. Embry hired a contractor to complete the work, and provided a copy of the new contract to Cecil Powell and Company. When the new contractor submitted a bill for completion of a portion of the work, he submitted these bills to Cecil Powell. When the bills were not paid, Embry made arrangements to meet with the Respondent and with Fitzhugh Powell. Embry met with Fitzhugh Powell at Cecil Powell and Company to discuss the nonpayment of the bills. At that meeting, Embry presented Fitzhugh Powell a copy of the letter from Cecil Powell and Company referencing Transamerica's insurance of the project (Petitioner's Exhibit 5). Fitzhugh Powell investigated internally and determined that neither Cecil Powell and Company nor Transamerica had provided any surety on the contract. Fitzhugh Powell's investigation revealed that the Respondent had received the monies paid for the surety bond, and had, with Chauncey and Whiddon, become a personal surety upon the contract. It was the opinion of Fitzhugh Powell, a licensee with over 30 years of experience in the insurance business and principal officer of a major insurance agency, that the Respondent had not insured the contract by agreeing to act as personal surety on the contract. However, Powell discharged the Respondent for acting as personal surety on the C and W contract. When Tull, Whiddon, and Chauncey were unable to cover the losses on the contract, E/B suffered significant financial losses which resulted in a loss of business reputation.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED: That the Department take no action against the Respondent's license. DONE and ENTERED this 14th day of December, 1992, in Tallahassee, Florida. STEPHEN F. DEAN 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 14th day of December, 1992.
Findings Of Fact By invitation to bid for Architect's Project No. 9129-A, the Board solicited bids for "construction of one new single story building at Lecanto School Complex in Lecanto, Florida." Joint Exhibit No. 1, p. 01010.1. Specifications (Re)stated The invitation to bid gave notice of a mandatory pre-bid conference at two o'clock on the afternoon of June 10, 1993, at Lecanto Vocational Center at the project site. Joint Exhibit No. 1, A-1. ("BIDDERS MUST ATTEND . . . TO BE ABLE TO BID") The invitation to bid consisted of a project manual, amended seriatim in a series of four addenda. Joint Exhibit No. 1. The project manual required substantial completion of the project within 250 days of written notice to proceed, Joint Exhibit No. 1, p. 00700.8, but on another page the same document required substantial completion by July 13, 1993. Id. at 00100.8. Later Addendum No. 1 put the date for substantial completion at "250 days after Notice to Proceed is given," but superseding Addendum No. 2 reverted to July 13, 1993. Addendum No. 3 directed prospective bidders to "[d]elete all previously issued Proposal Forms and replace with the Proposal Form attached." The attached form states: The undersigned agrees that if this bid is accepted, construction of this project will begin after receipt of "Notice to Proceed" and shall be substantially completed within 250 calendar days and finally completed within thirty (30) calendar days from substantial completion. Directions concerning the form specify that it is to "be copied on Contractor's business letterhead." Addendum No. 3, p. 5. Among the specifications were bond requirements, including minimum ratings for companies writing the bonds: To be acceptable to the owner as surety for Bid Bonds, Performance Bond, and Payment Bonds, a surety company shall comply with the following provisions: 3. The surety shall have at least the following ratings: . . . 1,000,000 to 1,500,000 A Class XI Joint Exhibit No. 1, p. 00600.1. Addendum No. 2 "delete[d] the Class ratings" but not Best's Policyholder's Ratings. Although the copy of the invitation to bid that came in evidence as Joint Exhibit No. 1 lacked pages 00400.1 and 00400.2, the table of contents indicates that these pages contain a bid bond requirement. The proposal form also calls for a bid bond. In its proposed recommended order, moreover, petitioner states that the Board "set forth in its project manual a provision that bidders should submit a bid bond from a company with an 'A 11' rating." The Project Manual states, at page 00100.3, that a contract "will be awarded only to a responsible Bidder, qualified by experience . . . . " Joint Exhibit No. 1. Bidders were required to submit forms along with their bids which called for, among other things, lists of major construction projects in process and major projects completed in the last five years. Joint Exhibit No. 1, p. 00110.3. Compliance Attempted When, on the afternoon of June 10, 1993, Greg Cecil, Grubbs' general manager, arrived for the pre-bid conference, he was erroneously "instructed that Lakeview was at another site in Hernando." T.70. When he arrived there, "somebody on site . . . said . . . Lakeview Relocation is going to be moved to the site that you were previously at." Id. By the time he again reached his original, correct destination, he "ended up being late for the meeting." Id. It was about quarter of three and only Tom Williford, who is the Board's Director for General Services, and an electrical subcontractor remained. T.78. Mr. Williford recounted what had occurred before the other contractors had dispersed, and told Mr. Cecil "that there would be an addendum issue[d] reflecting any items that occurred that day." T.211. The Board's Addendum No. 2 lists Mr. Cecil as having been "in attendance at the Mandatory Pre-Bid Conference." Bids Submitted Grubbs, Caldwell and others submitted bids for Architect's Project No. 9129A. Grubbs' bid was low, at one million one hundred five thousand dollars ($1,105,000.00). Dated June 17, 1993, Grubbs' proposal offered to bring construction to substantial completion by July 13, 1993. In a blank for "Bond Rating," "A- 11" was inserted. Joint Exhibits No. 2 and 3.11. The bid documents contained no other rating information. A form bid bond executed by Grubbs' president and by Sandra McCullough, as attorney in fact both for Reliance Insurance Company, a Pennsylvania Corporation, and for Employees Reinsurance Corporation, a Missouri corporation, accompanied Grubbs' bid. Best rates the former company A- and the latter A++, evidence at hearing showed. The body of the bond begins: KNOW ALL MEN BY THESE PRESENTS, that we JOHN G. GRUBBS, INC. P.O. BOX 10262, BROOKSVILLE, FLORIDA 34601 as Principal, hereinafter called the Principal, and RELIANCE INSURANCE COMPANY AND EMPLOYERS REINSURANCE CORPORATION, P.O. BOX 945090 MAITLAND, FLORIDA 32751 a corporation duly organized under the laws of the State of PENNSYLVANIA as Surety, hereinafter called the Surety, are held and firmly bound unto SCHOOL BOARD OF CITRUS COUNTY . . . . Joint Exhibits Nos. 2 and 3. Attached to the bid is a power of attorney appointing Ms. McCullough attorney in fact for Reliance Insurance Company and another limited power of attorney appointing her attorney in fact for Employees Reinsurance Company, which authorizes her to execute "any bond . . . in co- suretyship with RELIANCE INSURANCE COMPANY." Id. Grubbs' bid included a list of five "open contracts" for amounts ranging from $98,749 to $1,362,252 for projects ranging from a water storage system to sanitary sewer installation to road construction; and a list of some 95 completed projects including roads, sewers, clearing, earthwork, a $53,387 reroofing job, and a $116,772 job installing a canopy and sidewalks for a middle school in Hernando County. Joint Exhibit Nos. 2 and 3. After the bids had been opened, John G. Grubbs told the Board's architect of still other projects Grubbs had completed. On July 1, 1993, a principal of the architectural firm the Board had engaged wrote Mr. Williford, as follows: Dear Tom: We have reviewed the bids received and would recommend that the low bid from John G. Grubbs, Inc. be rejected for being in non- conformance with the Bid Documents for the following reasons: The bid by John G. Grubbs, Inc. was submitted on a proposal form that contained an error in the completion date. Their form indicated construction to be completed by July 13, 1993; rather than 250 days as required by the Bid Documents, per addendum #3. Bid Bond received was written by a bonding company having a Best rating of "A minus" (A-). The Documents require an "A" rating. (Section 00600, Page 00600.1, Third Paragraph) The Contractor's Qualification form indicates that John G. Grubbs, Inc. has been in the Site and Drainage business for ten (10) years but has not constructed any School Facilities. It also shows having completed construction of only two buildings and one under construction. These 3 buildings are small fire stations in the $300,000 range each. Due to the above outlined concerns we would recommend the contract be awarded to Caldwell Construction Company, the next low bidder. Respondent's Exhibit No. 1. The Board met on July 8, 1993. During the meeting, one Board member opined, "the critical thing here is probably the bond rating." Id., p. 26. The Board voted to reject Grubbs' bid and, separately, to accept Caldwell's.
Recommendation It is, accordingly, RECOMMENDED: That the Board dismiss Grubbs' petition and award the contract for Architectural Project No. 9129-A to Caldwell. DONE AND ENTERED this 11th day of October, 1993, in Tallahassee, Florida. ROBERT T. BENTON, II 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 11th day of October, 1993. APPENDIX TO THE RECOMMENDED ORDER IN CASE NO. 93-4325BID Petitioner's proposed findings of fact are not separately numbered. Respondent's proposed findings of fact Nos. 1-11 and 14-19 have been adopted, in substance, insofar as material. With respect to respondent's proposed finding of fact No. 12, respondent's Mr. Williford concluded at the time that Grubbs had complied. Respondent's proposed finding of fact No. 13 pertains to a subordinate matter. With respect to respondent's proposed finding of fact No. 20, Grubbs built a canopy and sidewalks at a school. With respect to respondent's proposed finding of fact No. 21, both the bid rating and the completion date were deviations. Intervenor's proposed findings of fact Nos. 1-22, 25, 26, 27 and 28 have been adopted, in substance, insofar as material. Intervenor's proposed findings Nos. 23 and 24 pertain to subordinate matters. With respect to intervenor's proposed finding of fact No. 29, the completion date and bond rating were both deviations. COPIES FURNISHED: Carl E. Austin, Superintendent Citrus County School Board 1007 W. Main Street Inverness, Florida 34450-4698 Thomas S. Hogan, Jr. 20 South Broad Street Brooksville, Florida 34605 Richard S. Fitzpatrick 213 North Apopka Avenue Inverness, Florida 34450-4239 Clark S. Stillwell Post Office Box 250 Inverness, Florida 34451-0250
