Findings Of Fact At all times pertinent to these proceedings, Kalunian was registered as a real estate broker with FREC holding Certificate Number 0045958. Kalunian's registration with FREC was suspended by FREC in an emergency suspension order dated September 21, 1978. On or about July 18, 1978, Harry and Joan Soden, as buyers, entered into a contract with Warren and Barbara Grund, as sellers, for the sale and purchase of real property. In connection with that sale, the buyers entrusted the sum of $2,000.00 with Kalunian as an escrow money deposit. The closing for this transaction was scheduled for October 1, 1978, and at no time prior to the scheduled closing did the parties to the transaction authorize the disbursement of the escrow money deposit. On or about June 23, 1978, John and Wanda Carlantonio, as buyers, entered into a contract with Ralph and Margarie Steigerwald, as sellers, for the sale and purchase of real property. In connection with that contract, the buyers entrusted the sum of $7,000.00 with Kalunian as an escrow money deposit. The closing for this transaction took place on September 15, 1978. However, at the time of the closing, the $7,000.00 escrow money deposit was not accounted for. At no time prior to the closing did the parties to the transaction authorize a disbursement of the escrow money deposit. On or about July 8, 1978, Diane Maholland, as buyer, entered into a contract with Rita Auletta, as seller, for the sale and purchase of real property. In connection with that contract the buyer entrusted the sum of $9,500.00 with Kalunian as an escrow money deposit. The closing of the transaction took place on September 6, 1978. However, at the time of the closing, the $9,500.00 escrow money deposit was not accounted for. At no time prior to the closing did the oarties to the transaction authorize a disbursement of the escrow money deposit. On July 31, 1978, the balance in Kalunian's escrow account was $501.13. On August 6, 1978, a letter from Kalunian was discovered in Kalunian's office. In that letter, Kalunian admitted that he had converted funds from his trust account for his own use.
The Issue The issue to be resolved in this proceeding concerns whether the Respondent has violated Subsection 475.25(1)(b), Florida Statutes; Subsection 475.25(1)(d)1, Florida Statutes; Subsection 475.25(1)(k), Florida Statutes; Subsection 475.42(1)(a), Florida Statutes; Subsection 475.25(1)(e), Florida Statutes; by being guilty of culpable negligence or breach of trust; by allegedly failing to promptly deliver a deposit; by allegedly failing to maintain trust funds in a proper escrow account; by allegedly depositing or intermingling personal funds with trust funds or escrow funds; by operating as a broker without holding a valid, current license; and by failing to preserve and make available to the agency all books, records, and supporting documents and by allegedly failing to keep an accurate account of all trust-fund transactions.
Findings Of Fact The Petitioner is an agency of the State of Florida charged with licensing and regulating the practice of real estate brokers and salespersons licensed in the State of Florida. It has the duty to prosecute with Administrative Complaints any alleged violations of Chapter 475, Florida Statutes, and related laws and rules, involved in the licensure and regulation of real estate brokers and salespersons. The Respondent, Richard Irwin Ray, is now and was, at all times pertinent to this case, a licensed real estate broker in the State of Florida. He was issued license number 0423296, in accordance with Chapter 475, Florida Statutes. The last license issued to him was as a non-active broker, bearing an address of 10013 Calle de Celestino, Navarre, Florida 32566. The Respondent, at times pertinent hereto, was the licensed and qualifying broker for the now-defunct Navarre Shores Realty, Inc. for the period from October 31, 1985 to approximately November 6, 1989. The Respondent and Navarre Shores Realty, Inc. failed to renew their licenses on March 31, 1989, the expiration date. Instead, the licenses were renewed effective April 5, 1989; and the Respondent continued to do business as a real estate brokerage and broker for several months thereafter through and including the time in which the transaction at issue was entered into. On or about July 27, 1989, Richard Walker, a salesman working for the Respondent's brokerage firm, solicited and obtained an executed contract for the sale and purchase of certain real property owned by Myra Lee Philips, the seller, and Charles W. and Pamela S. Brannon, the proposed buyers. The buyers gave the salesman, Mr. Walker, a $500.00 earnest money deposit called for by the terms of the contract, which terms also provided that the earnest money deposit was to be held in escrow by Navarre Shores Realty, Inc., the Respondent's real estate brokerage firm. Mr. Walker maintains that he turned in the check or submitted it to the broker or to one of his representatives or to someone who was "running the office at the time". He does not recall to whom he actually tendered the check when he received it; however, he recalls making a copy of the check and then making a copy of the check and the front page of the contract, with the check copy overlaid on it, which was the procedure in the office required by the Respondent in order that he could keep a record of sales transactions. In addition to Mr. Walker, the salesman, having no recollection of who, if anyone, he might have given the check to with the Respondent's brokerage firm, the Respondent has no recollection of receiving the check, ever seeing the check nor the manner or means by which the check was handled, as, for instance, whether it was deposited in his firm's escrow account or not. Mr. Charles Brannon, the proposed buyer in the subject transaction, testified that he executed a $500.00 earnest money deposit check in accordance with the terms of the contract referenced above and that the $500.00 check did clear his bank account; that is, it was paid upon being tendered to his bank. The Respondent maintains that he does not know the location of any records he might have, if any, related to this transaction and the subject earnest money deposit check. During the time in question immediately following the transaction date of July 27, 1989 and the time in November of 1989 when the Respondent closed his real estate office, the Respondent apparently had some disagreements with salespersons, including Mr. Walker. During this time period, the Respondent and his secretary, Ms. Galfano, learned that some client and sales transactions files were removed from the Respondent's brokerage office by Mr. Walker and others. Apparently, Ms. Galfano was able to retrieve some of the files; however, the Respondent was unable to, or in any event, failed to provide the Department's investigator, Mr. Bratton, with any records related to the subject transaction, including the escrow account records, which might have revealed whether the earnest money deposit check was deposited in the Respondent's escrow account or not, although the Respondent did advise Mr. Bratton by telephone on two occasions that he was endeavoring to have the bank prepare his escrow account records. The escrow account had been closed by Emerald Coast State Bank because service charges had been applied to it which resulted in its having a negative balance. This may mean that no $500.00 earnest money deposit check had been deposited in that account, and the Respondent does not know what happened to the check once the Brannons executed it and presumably gave it to Mr. Walker. He does not feel that it was ever placed in his escrow account, nor that he ever had any possession of it because the account was closed for having a negative balance due to the debiting of monthly service charges. In any event, the Respondent did not obtain and provide to the Petitioner the escrow account records. The Respondent stated in his testimony that if the buyers, the Brannons, could provide their bank records and produce the cancelled check involved, that would show how the check was cashed and, therefore, whether it was processed through his escrow account. The cancelled check was not produced and admitted into evidence at the hearing. Mr. Brannon, one of the buyers, merely testified that the check had cleared his bank and had been debited from his account upon which the check was written. Check number 3642 in evidence is the $500.00 check drawn on the account of Richard I. or Maryanne Ray, which is the check by which the Respondent paid the seller, Ms. Philips, the earnest money deposit funds which she was due because the transaction failed to close. A receipt for that check was issued to the Respondent by witness, Richard Walker, the Respondent's former salesman. The receipt indicates that the funds in question were received from R. Ray Construction, a/k/a Navarre Shores Realty, Inc. Mr. Walker did not adequately explain why he issued a receipt to the Respondent for the check drawn on his personal account and represented it as being from R. Ray Construction, a/k/a Navarre Shores Realty, Inc. He merely testified that he went to Mr. Ray, who "...was operating out of his personal account with his construction company. I did it because that's what he was known as at the time. OK. I did it in good faith." Mr. Walker does not have any knowledge concerning where the earnest money deposit check from the buyer, the Brannons, was actually deposited, nor whether the Respondent ever received it. Ms. Galfano was the secretary for Navarre Shores Realty, Inc., the Respondent's firm, at the time of the transaction in question and thereafter. Ms. Galfano established that Mr. Walker took some files from the office which contained sales contracts when the Respondent closed the office. She went to his home on a Sunday and persuaded him to give her back the records and took them back to the office. Ms. Galfano opined that certain files had been removed from the office by Mr. Walker because Mr. Walker was in a dispute at the time with one of the sales associates in the office. Navarre Shores Realty, Inc. had been experiencing internal problems with the associates disputing among themselves. In fact, the Respondent lost several associates from his firm due to internal dissension, presumably about credit for clients and contracts. It was because of this that the Respondent decided to close his office. At the time of the transaction between the Philips and the Brannons, Navarre Shores Realty, Inc., through Mr. Walker, had the listing on the property. Prior to that time, the Philips' property had been listed with Mr. Lou Jakes, also a sales associate with Navarre Shores Realty, Inc. The seller, Ms. Philips, later turned the listing over to Mr. Walker because she was upset with Mr. Jakes over upkeep not being properly done on the beach house in question. She called the off ice concerning this and happened to talk to Richard Walker, who persuaded her to change the listing from Lou Jakes over to him. Thus, the subject listing and transaction caused a dispute between Mr. Jakes and Mr. Walker, and Mr. Jakes left the firm as, later, did Mr. Walker. One of them apparently removed the subject records from the brokerage office. Since the transaction in question and the internal dissension in his office involving Mr. Walker and the other associate, the Respondent has had difficulty conversing with Mr. Walker because they are not on good terms. In summary, the evidence establishes at most that Mr. Walker received the earnest money deposit check from the buyers, the Brannons. It was not established that the Respondent ever received or became aware of the delivery of the earnest money deposit check to Mr. Walker. It was not established that it was ever deposited in any of the Respondent's or his corporation's accounts. It was established that the Respondent, partly out of a desire to avoid accusation of any illegality by the Petitioner, voluntarily paid the $500.00 to the seller out of his personal account, although he does not know or has no recollection that the money was ever received by him nor deposited in any of his accounts. The earnest money deposit check was not produced and placed into evidence, which could have shown in whose bank and account the check might have been deposited. Mr. Brannon only testified that the $500.00 check cleared and was debited from his account. It was established that the Respondent either has no records of his escrow account transactions with regard to this real estate transaction or is unaware of their location. It was likewise established, however, that upon request by Mr. Bratton, Petitioner's investigator, for copies of those records, the Respondent did not produce them. The Respondent maintains that he had requested that his banks provide a copy of his account records; however, as of the time of the hearing, he had not provided those to Mr. Bratton. It was also established that the Respondent and his brokerage firm were duly licensed at the time the transaction in question occurred and that some months later, in November of 1989, he closed his office and ceased doing business. It was established that his licensure expired on March 31, 1989 and that there was a six-day lapse of his licensure, with it being renewed on April 5, 1989. In November of 1990, on approximately November 6th, the buyers, the seller, and the Respondent signed a release of deposit agreement whereby the Respondent was to disburse $500.00 to the seller with regard to the subject transaction. See Exhibit 2 in evidence. On or about April 18, 1991, the Respondent made and delivered check number 3642, in the amount of $500.00, drawn on his personal checking account number 1322650, maintained at First National Bank of Santa Rosa, Milton, Florida, payable to Myra Lee Philips, who had been the seller in the subject transaction. Thus, in excess of five months elapsed between the time the Respondent agreed to disburse the $500.00 to Ms. Philips and the time he actually paid Ms. Philips the $500.00.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, and the candor and demeanor of the witnesses, it is therefore, RECOMMENDED that a Final Order be entered by the Department of Professional Regulation, Division of Real Estate, finding that the Respondent, Richard Irwin Ray, has violated Subsection 475.25(1)(d)1, Florida Statutes, by failing to promptly deliver a deposit; finding that he is guilty of having failed to preserve and make available to the Petitioner all books, records and supporting documents concerning trust-fund transactions in violation of Rule 21V-14.012(1), Florida Administrative Code, as well as Subsection 475.25(1)(e), Florida Statutes, and that he be accorded the penalty for these violations of a written reprimand and a $250.00 fine. Concerning his violation of Subsection 475.42(1)(a), Florida Statutes, and the consequent derivative violation of Subsection 475.25(1)(e), Florida Statutes, by operating for six days without a license, it is recommended that due to this inadvertent, technical licensure lapse that no penalty be imposed. DONE AND ENTERED this 1st day of July, 1992, in Tallahassee, Leon County, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of July, 1992. COPIES FURNISHED: Darlene F. Keller, Division Director Division of Real Estate P.O. Box 1900 Orlando, FL 32802-1900 Jack McRay, Esq. General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, FL 32399-0792 James Gillis, Esq. Department of Professional Regulation Division of Real Estate 400 West Robinson Street P.O. Box 1900 Orlando, FL 32802-1900 Richard Irwin Ray 10013 Calle de Celestino Navarre, FL 32566
Recommendation Based on the foregoing stipulated facts and conclusions of law as found above, I recommend that the Defendant be issued a private written reprimand. DONE and ENTERED this 25th day of February, 1977, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Robert J. Randolph, Esquire Randolph & Randolph P. O. Box 1546 209 West Ocean Boulevard Stuart, Florida 33494 Frederick H. Wilsen, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789
Findings Of Fact At all times material hereto, Respondent Robert Marriott has been a licensed real estate broker/salesman under the laws of the State of Florida, trading as Marriott Realty. In February of 1980, in his capacity as a real estate broker/salesman, Respondent obtained an offer to purchase commercial property in Miami from Orlando Villacis, a resident of Ecuador, as purchaser, for a total purchase price of $500,000. In conjunction with the offer, Villacis paid a $20,000 earnest money deposit to be held by Marriott Realty in escrow under the terms of the offer. Villacis' deposit check in the amount of $20,000 was deposited into the Marriott Realty escrow account on February 22, 1980. By March 11, 1980, Villacis' $20,000 had been withdrawn, leaving an escrow account balance of $40. This fact was never reported to Villacis. Having heard nothing definite from Respondent with regard to the offer, and because he spent most of his time out of the country, Villacis engaged the services of attorney Rafael Penalver. Prior to July 1980, Penalver contacted the Respondent and inquired as to the status of the offer. Each time, Respondent told him that the seller was still considering the offer. In July of 1980, Respondent told Penalver that the $500,000 offer had been rejected by the seller and recommended that Villacis present an offer for $570,000. Penalver prepared the offer in the amount of $570,000, again calling for a $20,000 earnest money deposit, which Penalver and Villacis assumed was still in the Marriott Realty escrow account. Receiving no response from Respondent on the second offer, Penalver attempted to contact Respondent by telephone on numerous occasions. When Penalver was successful, Respondent told him that the seller was reviewing the offer. In early September 1980, Respondent advised Penalver that the $570,000 offer had been rejected by the seller. By letter dated September 11, 1980, Penalver raised the offer to $600,000, set a deadline of September 19 for the acceptance of the offer, and directed Respondent to return the $20,000 immediately should the offer not be accepted. After September 19, having heard nothing from the Respondent, Penalver called him, at which time Respondent advised that the offer was being considered by the seller. Penalver then wrote a letter dated October 7, 1980, to Respondent demanding that Respondent deposit the $20,000 into Villacis' account. Again hearing nothing from Respondent, Penalver on numerous occasions attempted to contact him by telephone in order to again demand the immediate return of the $20,000 deposit. Being unsuccessful, Penalver wrote the Respondent on November 20, 1980, and January 22, 1981, both times demanding the return of the $20,000 earnest money deposit. After the letter of January 22, 1981, Respondent agreed to meet with Penalver in Penalver's office. On February 2, 1981, the Respondent and his wife met with Penalver. During that meeting, Respondent advised Penalver that the $20,000 was no longer available and that he and his wife had used the money to make mortgage payments and cosmetic improvements on their personal residence. Respondent challenged Penalver to sue him to get the money back. After discussing Respondent's position with Villacis, Penalver filed a civil action for return of the $20,000. In his Answer to the Complaint filed in that litigation, Respondent admitted that he had used the $20,000 deposit for mortgage payments and other personal household expenses and for payment of his IRS tax deficiency. Villacis obtained a Final Judgment in the civil action in the amount of $20,000 plus interest and costs on October 6, 1982. Respondent testified that he did not return the $20,000 earnest money deposit because, in approximately October 1980, Villacis verbally agreed to loan the $20,000 to Respondent. Villacis strongly denied making any offer of a loan to Respondent. The purported loan agreement would have occurred after Penalver had twice written Respondent regarding immediate return of the $20,000 and seven months after the $20,000 had disappeared from the escrow account. Further, after Penalver sent his November demand letter, Respondent wrote Villacis in December of 1980 asking that Villacis consider loaning Respondent the $20,000 in exchange for an unrecorded mortgage on Respondent's personal residence. Clearly, Respondent's testimony is not credible. As of the date of the formal hearing in this cause, the Final Judgment in favor of Villacis and against Respondent remained unpaid and Respondent had still not returned to Villacis the $20,000 earnest money deposit.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding Respondent guilty of the allegations contained within the Administrative Complaint filed against him and revoking his license as a real estate broker/salesman. DONE and RECOMMENDED this 30th day of April, 1984, in Tallahassee, Leon County, Florida. LINDA M. RIGOT, 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 30th day of April, 1984. COPIES FURNISHED: Tina Hipple, Esquire Division of Real Estate 400 West Robinson Street Orlando, Florida 32801 David I. Schlosberg, Esquire 525 North 27th Avenue, Suite 100 Miami, Florida 33125 Frederick Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Harold Huff, Executive Director Division of Real Estate 400 West Robinson Street Orlando, Florida 32801
The Issue Whether Respondent committed the offenses set forth in the Administrative Complaint and, if so, what action should be taken.
Findings Of Fact At all times material hereto, Louis M. Loguercio (Respondent) was licensed in the State of Florida as a real estate salesperson, having been issued license number 0609113. From March 11, 1996, through July 13, 1997, Respondent was a salesperson for CMT Holding Ltd., a partnership trading as The Prudential Florida Realty. Martha Meloni and her husband, Mario Meloni, (Sellers) owned residential property located at 6412 Southwest 127 Court, Miami, Florida. The Sellers' property was listed for sale with Jorge "Ivan" Salomon, a broker operating his own company, Real One Realty Corporation. On May 1, 1997, Carlos Castellanos and his wife, Daritza Jiminez, a/k/a Daritza Jiminez-Castellanos, (Buyers) met Respondent at his office at The Prudential Florida Realty. They were referred to Respondent by one of his clients. The Buyers were from Venezuela and had had no contact with Respondent prior to this transaction. On May 1, 1997, Respondent prepared a draft Residential Sale and Purchase Contract (Contract) for the purchase of the Sellers' property for $150,000 by the Buyers. Respondent drafted the Contract on behalf of the Buyers and prepared the contract while the Buyers were in his office. The terms of the Contract required an initial deposit of $2,000 from the Buyers to be held in escrow by Steven Greenspan Law Office, as "Escrow Agent." The Contract also required a $13,000 additional deposit to be made within ten (10) days of the date of the Contract. While the Buyers were in Respondent's office, they wrote two checks, and signed them, for deposits on the property: one for $2,000 dated May 1, 1997, and one for $13,000 dated May 15, 1997. The checks were made payable to Alan Greenspan, P.A. The Buyers wrote both checks with Respondent's assistance. The Buyers wanted to personally take the $2,000 deposit check to Alan Greenspan, the escrow agent. The Buyers permitted Respondent to photocopy the checks while they were in Respondent's office. Once the checks were photocopied, Respondent returned the checks to the Buyers. Respondent advised the Buyers to deliver the $2,000 check to the escrow agent that day and to mail the second check by the due date. Mr. Greenspan's office was in the same building as the mortgage company that the Buyers were using for the purchase of the property. His office was also in close proximity to Respondent's office. The Buyers failed to deliver the $2,000 deposit check to Mr. Greenspan on May 1, 1997. Respondent did not know that the check had not been given to Mr. Greenspan by the Buyers. Mr. Greenspan received a copy of the Contract. He did not contact any of the parties to the Contract regarding the escrow monies. As an escrow agent, Mr. Greenspan's office handles a large volume of closings and it is possible, according to him, that his staff assumed that the escrow monies had been received. No one in Mr. Greenspan's office verified that the monies had been received. Prior to the due date for the payment of the second deposit of $13,000, Respondent contacted the Sellers' listing agent, Mr. Salomon, and informed him that the Buyers were having problems paying the second deposit. Shortly after the due date for the payment of the second deposit, Mr. Salomon contacted Respondent, who informed Mr. Salomon that the Buyers had the money. Respondent also faxed Mr. Salomon a copy of the two checks for the two deposits, which were written on May 1, 1997. Mr. Salomon faxed a copy of those checks to the Sellers. Respondent did not inform Mr. Salomon that the Buyers had not given the deposit checks to him. Unbeknownst to Respondent, the Buyers had also failed to mail the second deposit of $13,000 to Mr. Greenspan. Mr. Salomon, having received the fax copy of the checks, assumed that the escrow agent had the Buyers' deposits. The Sellers, having received the fax copy of the checks, assumed also that the escrow agent had the Buyers' deposits. Mr. Greenspan became aware that his office did not have the Buyers' deposits in escrow when the mortgage company requested that he provide an escrow letter. He contacted the Sellers' attorney, who faxed a copy of the Buyers' checks. At that time, Mr. Greenspan became concerned regarding the Contract because the Contract made it appear that he, as the escrow agent, had deposits that he did not have. Mr. Greenspan contacted Respondent regarding the absence of the escrow deposits. Respondent was apologetic and responded to Mr. Greenspan that he (Respondent) was sorry that the Buyers had not given him (Mr. Greenspan) the deposits as they had indicated that they would do. After being contacted by Mr. Greenspan, Respondent attempted to contact the Buyers. He was unsuccessful. The Sellers did not become aware that none of the deposits were in escrow until the day before the scheduled closing on the property. In the manner in which Respondent handled the Buyers' deposits, he failed to follow office policy and practice of The Prudential Florida Realty. According to the office policy and practice, the sales associate handling the transaction has the duty to ensure that the buyer's deposit(s) are deposited with the designated person or entity at the designated time or date. Respondent also failed to advise the Sellers' agent, Mr. Salomon, or the escrow agent, Mr. Greenspan, the Sellers' attorney, or the Sellers that the Buyers had not given him any deposits.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Real Estate Commission enter a final order dismissing the Administrative Complaint against Louis M. Loguercio. DONE AND ENTERED this 29th day of April, 1999, in Tallahassee, Leon County, Florida. ERROL H. POWELL Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 29th day of April, 1999.
Findings Of Fact Louis S. Wooten, Sr. is a registered real estate broker holding license No. 0098381. Louis S. Wooten, Sr. did business at the times involved in the administrative complaint as Lou Wooten Realty. Adequate notice of this hearing was given Louis S Wooten, Sr. in the manner required by Chapter 120 and Chapter 475, Florida Statutes. Evidence was received concerning deposits and withdrawals by Louis S. Wooten, Sr. from the Louis S. Wooten, Sr. escrow account in Peoples First National Bank, Miami Shores, Florida, between August 1, 1975 and November 10, 1975, when this account was closed. These records were identified by John Fortnash, vice president of the bank. These records included the ledger for this account from May, 1975 to November, 1975, (Exhibit 1), the ledger from November, 1975, until November 1976, (Exhibit 2), the signature card showing Louis S. Wooten to be the only person authorized to draw on the account, (Exhibit 3), and sixteen (16) individual deposit slips received as Composite Exhibit 4. These records show no activity in the account subsequent to December 23, 1975, when this account had a balance of $22.00. Thereafter, the balance of this account decreased by $2.00 per month, a service charge, until November 10, 1976, when the balance reached zero and the account was closed. Concerning Count 1, Yvard Jeune and Rosita Jeune contracted on or about September 26, 1975, to purchase certain real property from Eddie Silver for $28,500. The Jeunes paid $100 as an initial deposit to Lou Wooten, Sr., and agreed to pay an additional $1,900 for a total deposit of $2,000. This additional $1,900 was paid to Lou Wooten Realty by manager's check on or about September 30, 1975. This manager's check was identified by Barry Eber, chief savings and loan officer for First Savings and Loan of Miami, and received as Exhibit 5. The Jeune contract was contingent upon FHA financing for the Jeunes. FHA financing was not approved, and the Jeunes requested return of their $2,000 in accordance with the terms of the contract. The Jeunes never received their money from Louis S. Wooten, even though they eventually brought suit against Wooten and obtained a judgment against him. The records of Wooten's escrow account do not show the deposit of the $1,900 received from the Jeunes. Regarding Count 2, on or about October 19, 1975, Emma Crockett made an offer to purchase certain real property and paid an earnest money deposit to Lou Wooten Realty in the amount of $1,000 which was receipted for by Mollie Johnson. Mollie Johnson identified the receipt signed by her and testified that this money was duly delivered to Lou Wooten. Subsequently, Crockett's offer of $29,500 was rejected by the seller, and on December 24, 1975, a demand was made for return of the deposit. The cancellation mark on the check, identified by Crockett and received as Exhibit 24, indicates that it was received by Wooten Realty. Crockett's deposit was never returned to her by Wooten. As noted above, the Lou Wooten escrow account was closed with a zero balance. Regarding Count 3, George D. Pratt, Jr. and his wife, Eloise, contracted to purchase certain real property from Gladys P. Smith on or about December 5, 1975. The Pratts paid an initial deposit of $100 to T.F. Chambers and subsequently paid an additional $665 in the form of a manager's check to Lou Wooten Realty. This manager's check was identified by Barry Eber, chief savings and loan officer, First Federal Savings and Loan of Miami, and received as Exhibit 6. Harriet Pooley, an employee of Lou Wooten Realty, identified a receipt to George D. Pratt, Jr. and Eloise in the amount of $665 which was received as Exhibit 18. A review of the ledgers of the Louis S. Wooten, Sr. escrow account indicates no deposits were made to this account subsequent to November 26, 1975. Regarding Count 4, Bettye Green paid Lou Wooten Realty a deposit of $150 on a transaction in which she and her husband offered to purchase real property owned by the Fidlers. The Greens defaulted on the contract, and were advised by their salesman, T.F. Chambers, that their deposit would be forfeited. No evidence was introduced by the Florida Real Estate Commission regarding any demand on the Fidler's behalf for the money. Regarding Count 5, Mary Redfield, a friend and representative of Goldie Brown and Bernard Brown, identified a copy of a manager's check earlier identified by Barry Eber, chief loan officer of First Federal Savings and Loan of Miami and received as Exhibit 7, as a copy of an original check for $1,500 given to her by Goldie Brown which was deposited to Wooten's escrow account. Redfield also identified a contract, Exhibit 16, and a closing statement, Exhibit 17, as documents given to her by Goldie Brown. T.F. Chambers was the salesman who handled this contract. Chambers appeared at closing, after having purchased Lou Wooten Realty from Louis S. Wooten, Sr.Chambers stated that the Wooten escrow account lacked sufficient funds to permit closing the transaction and that he had personally paid for a cashiers check in the amount of $680, the amount necessary to close the purchase. Chambers identified this check which, as a part of Exhibit 21, was received into evidence. Regarding Count 6, Alladar Paczier, counsel for Istvan and Julia Beres, identified a deposit receipt contract for a bar and restaurant (Exhibit 26) and a receipt for a $3,500 deposit signed by Louis Wooten (Exhibit 27). Paczier represented that Wooten failed to produce the deposit money at closing, and that when demand was made by Paczier of Wooten for the deposit, Wooten stated to him that he did not have the money.
Recommendation Based upon the foregoing findings of fact and conclusions of law, the Hearing Officer recommends that the Florida Real Estate Commission revoke the registration of Louis S. Wooten, Sr. DONE and ORDERED this 17th day of January, 1978, in Tallahassee, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings Room 530 Carlton Building Tallahassee, Florida 32304 COPIES FURNISHED: Joseph A. Doherty, Esquire Florida Real Estate Commission 400 Robinson Avenue Orlando, Florida 32801 Louis S. Wooten, Sr. 743 Fairlawn Drive Sebring, Florida 33870
The Issue The issue presented is whether Respondents are guilty of the allegations contained in the Administrative Complaint filed against them, and, if so, what disciplinary action should be taken against them, if any.
Findings Of Fact At all times material hereto, Respondent Richard Shindler has been a licensed real estate salesman in the State of Florida, having been issued License No. 0395044. The last license issued was as a salesman with Global Real Estate & Management, Inc. At all times material hereto, Respondent Global Real Estate & Management, Inc., has been a corporation registered as a real estate broker in the State of Florida, having been issued License No. 0223589. At all times material hereto, Mark H. Adler was licensed and operated as the qualifying broker and officer of Global Real Estate & Management, Inc. Adler's license is currently under suspension by agreement with Petitioner as a result of the activities complained of in the Administrative Complaint filed in this cause. At no time has Respondent Shindler been a director or officer of Respondent Global Real Estate & Management, Inc. At all times material hereto, Respondent Shindler has been the sales manager for Respondent Global Real Estate & Management, Inc. As the sales manager, Respondent Shindler sometimes helped other salesmen structure financing and helped them with other problems. Respondent Shindler was not responsible for the collection of funds from individual salesmen. Each individual salesman was responsible for collecting funds from any real estate transaction and giving those funds to Respondent Global's bookkeeper for deposit. As sales manager, Shindler was a signatory on the escrow account in order to make disbursements for small transactions mainly involving rental properties. In addition, Respondent Shindler was responsible for the hiring and firing of office personnel. However, he had no control over the contracts of other salesmen. On March 13, 1989, Respondent Shindler, as a private purchaser, made two purchase offers for two pieces of property owned by the same sellers. The purchase offers were for $115,000 and $80,000, respectively, and required that Respondent Shindler place $6,000 and $5,000, respectively, into Respondent Global's escrow account as a deposit on the purchase of the properties. Respondent Global and real estate broker Jay Hirsch were to receive commissions on the sale of the properties. Those offers to purchase disclosed in writing that Respondent Shindler was also a licensed real estate salesman. Although both offers to purchase were accepted by the sellers, the transactions involving the purchase of these properties did not close due to Respondent Shindler's inability to obtain financing, which was a contingency of the contracts. In October, 1989, demands for the release of the escrowed monies were made by the sellers and by the sellers' broker Jay Hirsch. They made demand upon Respondent Global's attorney. Additionally, Jay Hirsch made demand on Mark Adler by telephone and then by demand letter to Adler, who, as the qualifying broker for Respondent Global, was responsible for the release of the escrowed funds. Subsequent to the demands made by the sellers and their broker, Respondent Global filed a complaint for interpleader. The escrowed deposits were eventually disbursed pursuant to a settlement among the parties claiming an interest in the escrowed deposits. In March, 1990, Petitioner began an investigation of the Respondents and Adler. Investigators Castro and Rehm both participated in the investigation. Investigator Castro believed Respondent Shindler to be the office manager of Respondent Global. During the initial interview with Respondent Shindler, he produced records which indicated that a deposit of $14,265.69 had been made on January 13, 1989, into Respondent Global's escrow account. This check had been given by Respondent Shindler to Global's bookkeeper for deposit. This deposit represented proceeds from the sale of property owned by Respondent Shindler's brother Paul, and was placed in escrow in anticipation of the offers to purchase made by Respondent Shindler on the two properties involved in this cause. Investigator Rehm examined the escrow account bank records and determined that for a two-month period the escrow account balance had dropped below the minimum $11,000 balance required by the two contracts in question herein alone. Initially, Respondent Shindler advised the investigators that the bank where the escrow account was maintained had represented that it had debited the escrow account as a result of a lien placed on that account by the Internal Revenue Service. Upon further investigation, Respondent Shindler advised the investigators that the bank itself had withdrawn $3,200 from Global's escrow account to cover a shortage in Respondent Global's operating account. At all times material hereto, both Adler and Respondent Shindler were signatories on the escrow account. As part of its investigation, Petitioner served a subpoena on Maria Aguerra, Respondent Global's bookkeeper, requesting from Adler, or Respondent Shindler, or the custodian of records for Respondent Global Real Estate, all contracts, leases, agreements, monthly bank statements, deposit slips, and cancelled checks for all accounts for the period of January 1, 1989, through March 22, 1990. Some of the requested documents were initially unavailable because they had previously been sent to the Florida Real Estate Commission. Although Adler testified that he was initially unaware that a subpoena had been served, he was given a 30-day extension to produce the records when he met with investigators Castro and Rehm on May 1, 1990. Although Adler had both the responsibility for and control over the records of Respondent Global, he was not fully familiar with the records, and the bookkeeping was in disarray. At all times material hereto, Adler, as the broker for Respondent Global, was responsible for operating the Global office, for overseeing Global's escrow account, for reviewing contracts, and for being aware of the day-to-day events in the Global office. In addition, as the broker, Adler was required to be an officer of the corporation, to be a signatory on the escrow account, to have prepared and to sign the monthly escrow account reconciliations, and to respond to Petitioner if there were complaints or requests for production of documents. Adler, as the broker for Respondent Global, did not reconcile and sign escrow account statements on a monthly basis since he was not aware of the requirement that he do so. However, Adler did testify that he was aware of his responsibility for escrowed funds. At no time did Respondent Shindler have the responsibility to maintain Global's escrow account or to reconcile the escrow account on a monthly basis. At no time did Respondent Shindler represent that he was the broker for Respondent Global or that he was a broker. Respondent Shindler did not state to investigator Rehm that he was acting as the broker for Global or that Adler had simply lent Adler's license to Shindler to use. At no time did Adler and Respondent Shindler enter into an agreement whereby Shindler would act as the broker for Global using Adler's broker's license, and Adler was never paid any monies for any use of his broker's license. Adler testified that his involvement with Global's business had declined as he had pursued his growing interest in performing appraisals.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that a Final Order be entered: Dismissing Counts II, III, VII, VIII, and IX of the Administrative Complaint filed herein; Finding Respondent Global Real Estate & Management, Inc., guilty of the allegations contained in Count V of the Administrative Complaint; and Ordering Respondent Global Real Estate & Management, Inc., to pay a fine in the amount of $500 by a date certain. RECOMMENDED in Tallahassee, Leon County, Florida, this 20th day of March, 1991. LINDA M. RIGOT 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 20th day of March, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-4522 Petitioner's proposed findings of fact numbered 2-5, 7-9, 11-12c, 13, 14, and 16 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed finding of fact numbered 1 has been rejected as not constituting a finding of fact but rather as constituting a conclusion of law. Petitioner's proposed finding of fact numbered 6 has been rejected as being unnecessary for determination of the issues herein. Petitioner's proposed findings of fact numbered 10, 15, and 17 have been rejected as not being supported by the weight of the credible evidence in this cause. Petitioner's proposed finding of fact numbered 12d has been rejected as being irrelevant to the issues under consideration herein. Respondents' proposed findings of fact numbered 1-22 have been adopted either verbatim or in substance in this Recommended Order. The transcript of proceedings, together with Petitioner's Exhibits numbered 3, 5, and 8-14 and Respondents' Exhibit numbered 1 which were admitted in evidence. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation Division of Real Estate - Legal Section 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Harold M. Braxton, Esquire 9100 South Dadeland Boulevard Suite 400 - One Datran Center Miami, Florida 33156 Jack McRay General Counsel Department of Professional Regulation Northwood Centre, Suite 60 1940 North Monroe Street Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801
The Issue Whether Respondent is guilty of fraud, misrepresentation, concealment, false pretenses, false promises, dishonest dealing, culpable negligence, or breach of trust in a business transaction, in violation of Section 475.25(1)(b), Florida Statutes (1993).
Findings Of Fact Petitioner is a state licensing and regulatory agency charged with the responsibility and duty to prosecute Administrative Complaints pursuant to the laws of the State of Florida. Respondent is now and was at all times material hereto a licensed real estate broker in the State of Florida, having been issued license number 0267809. The last license issued was as a broker trading as “Trendsetter Realty and Mortgage”, 977 Humphrey Boulevard, Deltona, Florida 32738. The Respondent operated as a real estate broker during the relevant time period of approximately June 1993 through July 1995. The Respondent is not licensed to practice law in the State of Florida or any state. On or about June 18, 1993, the Respondent prepared certain documents in connection with the sale and purchase of real property located at 1847 North Acadian Drive, Deltona, Volusia County, Florida. Respondent prepared the contract based upon the offer made by the buyer, Juan and Susana C. Veliz, and the counteroffer made by the seller, Jerry and Tammy Maltempi, and in accordance with the wishes of buyer and seller. The subject property was encumbered by a first Mortgage, which secured a Note held by J.I. Kislak Mortgage Corporation and guaranteed by the federal Department of Veterans Affairs. The mortgage and note contained a “due on sale” clause and clearly stated on its face that “[t]his loan is not assumable without the approval of the Department of Veterans Affairs or its authorized agent.” The Buyers and the Sellers were aware of this restriction at the time of the transfer of possession. The Buyers executed an initial, handwritten, offer that specifically stated in bold, capitalized print that "if not fully understood, seek the advice of an attorney prior to signing.” The Buyers then received a typed counteroffer, as opposed to the handwritten original offer, which also stated the same admonition to seek advice of an attorney. The counteroffer was mailed to the Buyers for review and execution by Mr. Veliz and his wife. The Buyers read the numbers, but not the fine print, prior to signing the contract. The sale document was executed by the Buyers and Sellers on or about June 18, 1993 and was denominated a Contract for Deed with a sale price of $85,000. The contract provided for a $1,000 initial deposit, followed by a second deposit of $8,783.50 which was due upon acceptance by the Sellers. The transfer of title was to occur on or before July 6, 1995. Upon payment of the full deposit, the Sellers would transfer possession to the Buyers and the escrowed funds (except for $1,200) would be disbursed. Buyers would assume the responsibility of repair and maintenance of the property upon taking possession. On or about July 3, 1993, Buyers tendered the sum of $9,783.50 to the Respondent and assumed possession of the property. Respondent explained to the Buyers about the agency relationship and her representation of the Sellers; that she owed a duty of fair dealing and honesty to the Buyers; the risks associated with an agreement for deed; the foreclosure status of the property the Buyer’s were purchasing; and the fact that the deposits were non-refundable after occupancy of the premises. Respondent disclosed the nature of her agency relationship, both orally and in writing, to both the Buyers and the Sellers in the transaction at issue. Respondent disclosed, in writing, to the Buyers that deposits being made by the buyer were non-refundable upon occupancy of the premises. At the hearing, Mr. Veliz demonstrated his ability to speak, read and understand the English language. The Buyers had ample opportunity to seek independent representation, either through a realtor or through an attorney prior to signing the contract and prior to taking possession of the premises. The Buyers chose not to do so. Prior to Buyers taking possession of the home, Respondent, via telephone conversation, described this transaction to J.I. Kislak Mortgage Corporation, the holder of the note and mortgage on the property, and advised them that a sale was pending and the past due mortgage payments would be brought up to date. Between July 9 and 12, 1993, with the consent of the parties, the Respondent disbursed: $2,962 to herself, as a real estate commission; $2,857.12 to the sellers; and $2,759.38 to J. I. Kislak Mortgage Corporation for payment on the mortgage. Respondent retained $1,200 in escrow for future closing costs. As a service to the parties, Respondent collected the monthly mortgage payment from the Buyer and forwarded it directly to the mortgage holder for several months. Buyers paid the agreed upon amount of $657.00 per month from August 1993 until May or June 1994. In June 1994, J.I. Kislak Mortgage Corporation refused to accept any additional payments toward the mortgage until an adjustment was made in the escrow account for the payment of insurance premiums on the property. The mortgage company called for an upward adjustment in the approximate amount of two hundred dollars per month. Neither the Buyers nor the Sellers were willing or able to pay the additional premium amount. The mortgage corporation subsequently foreclosed and took possession of the property during the last half of 1994. Buyers lost their equity in the house including approximately eight thousand dollars in improvements to the property. Following the foreclosure, Respondent disbursed the balance remaining in her company’s escrow account to the Buyers, in the amount of $1,205, on or about September 22, 1995. Respondent prepared an agreement or contract for deed which a broker is not authorized to prepare. Respondent failed to anticipate a possible increase in the mortgage payment escrow for taxes and insurance at the time the original contract was prepared. The failure of the transaction to close, and the losses suffered by the parties, were not due to a calling of the loan by the mortgage company pursuant to the due on transfer clause of the mortgage. The failure of the transaction to close was not due to the non-refundability of the deposits made by the Buyers. There was no intent on the part of Respondent to commit fraud, misrepresentation, concealment, false promise, false pretense, dishonest dealing or breach of trust in this matter. Respondent is guilty of culpable negligence in this matter.
Recommendation Upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Florida Real Estate Commission, enter a final order finding Respondent Not guilty of fraud, misrepresentation, concealment, false pretenses, dishonest dealing or breach of trust in a business transaction. Guilty of culpable negligence, in violation of Section 475.25(1)(b) Florida Statutes, and impose an administrative fine in the amount of $1,000 and suspend Respondent’s license for a period of three months. RECOMMENDED this 30th day of January, 1997, at Tallahassee, Florida. DANIEL M. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 30th day of January, 1997. COPIES FURNISHED: Steven D. Fieldman Chief Attorney, Real Estate Department of Business and Professional Regulation Division of Real Estate 400 West Robinson Street Orlando, Florida 32808 Wade F. Johnson, Jr. Esquire Wade F. Johnson, Jr., P.A. 118 East Jefferson Street Orlando, Florida 32801 Henry M. Solares Division Director Department of Business and Professional Regulation Division of Real Estate Post Office Box 1900 Orlando, Florida 32802-1900 Lynda L. Goodgame General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue The issues presented herein are whether or not the Respondent, Maria M. Drummond Mulgrave, failed to account and deliver monies received in a trust or escrow bank account monies received as a deposit for realty in a real estate transaction in violation of Subsections 475.25(1)(d), Florida Statutes, and by reason thereof, Respondent engaged in acts and/or conduct amounting to fraud, is representation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction in violation of Subsection 475.25(1)(b), Florida Statutes.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received and the entire record compiled herein, I hereby make the following relevant factual findings. During times material herein, Respondent, Maria M. Drummond Mulgrave, was a licensed real estate salesperson and has been issued license number 0396817. Respondent's last issued license was as a salesperson and she worked through the entity, Welsh International Realty, Inc., 4684 NW 183 Street, Miami, Florida 33155. Respondent, in her capacity as a salesperson, on January 31, 1984, was the selling agent who executed a purchase, sales contract and receipt for deposit for purchasers Michael A. and Marjorie Bucknor for a residence situated at 240 NW 203 Terrace, Miami, Florida. The seller of that property was Equitable Relocation Management Corporation (Equitable). Equitable executed the sales contraction February 7, 1984. On January 31, 1984, Respondent Mulgrave received in trust a $1,000 earnest money deposit which was held in an escrow account by her broker, Welsh International Realty, Inc. In connection with the January 31, 1984 sales contract, the purchasers were to tender to the Respondent an additional $6,500 deposit within 5 days of acceptance by the seller or, in this case, on February 12, 1984, inasmuch as Equitable approved and executed the sales contract on February 7, 1984. (Petitioner's Exhibits 1 and 2) 3/ Petitioner has alleged that the listing agency, Associates Realty Company (Associates), requested from the Respondent on March 11 and March 19, 1984, an escrow letter verifying that the additional escrow deposits had, in fact, been made. It is also alleged that the Respondent verbally assured Associates that the entire deposit of $7,500 was in escrow and that the sale would close, but Respondent did not then provide Associates the promised escrow letter. It is also alleged that Associates relied upon Respondent's statements that the deposit was in escrow and that it was not until approximately April 17, 1984 that Respondent admitted to Associates Realty that only $1,000 was in escrow. (Petitioner's Exhibit 3) As stated, Respondent Oswald S. Welsh entered into a stipulated settlement and is no longer a Respondent in these proceedings. Sometime following the execution of the sales/deposit receipt contract by the Bucknors and the sellers, Equitable Relocation Management Corporation, by its agent Claire Smith, Respondent Mulgrave left the Miami area and gave the pending sales contracts to her sponsoring broker, Oswald S. Welsh. Marcia Mize was, during times material herein, the processing supervisor for the listing agency, Associates Realty. Once Ms. Mize began processing the Bucknor contract, she commenced making inquiries from Welsh International Realty, Inc. trying to get the needed verifications of income, etc. to the mortgage company such that the purchasers could be processed and a commitment letter issued. Ms. Mize made several oral requests of Welsh International Realty for verification of the escrow deposits from approximately February 7, 1984 through March 9, 1984. On March 17, 1984, Ms. Mize learned (from Respondent) that Welsh Realty only had $1,000 in escrow. Oswald S. Welsh, the broker for Welsh International Realty, Inc., by letter dated January 31, 1984, advised Associates Realty that Welsh was holding $1,000 in escrow from the Bucknors toward the purchase of the subject property. Marcia Mize was unsure if Respondent Mulgrave advised her that she had the additional $6,500 in deposits. Ms. Mize testified that she spoke with several secretaries employed by Welsh International Realty but she was unable to verify that she determined that it was Respondent Mulgrave who advised that the additional $6,500 deposit was in escrow with Welsh International Realty, Inc. Respondent Mulgrave later determined that the Bucknors were having marital and financial problems and, as a result, were unable to close on the transaction as agreed in the purchase/sales contract. Respondent Mulgrave denies that she, at any time, advised Marcia Mize of Associates Realty that she had the $6,500 which represented the balance of the remainder of the downpayment by the Bucknors in the purchase of the residence from Equitable. Respondent Mulgrave turned this transaction over to her sponsoring broker, Oswald S. Welsh when she had to leave the Miami area to attend to some pending family business. The Bucknors did not give Welsh International Realty, Inc. the remaining $6,500 escrow deposit which represented the remainder of their downpayment toward the purchase of the subject residence.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is hereby recommended that the administrative complaint filed herein against Respondent, Maria M. Drummond Mulgrave, be DISMISSED. RECOMMENDED this 18th day of September, 1985, in Tallahassee, Florida. JAMES E. BRADWELL 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 18th day of September, 1985.
Findings Of Fact At all times material to these proceedings, the Respondent McVety was a licensed real estate broker in Florida, having been issued license numbers 0461636 and 0258678. On January 1, 1989, the Respondent purchased the company Realty Services of Southwest Florida, Inc., a Florida corporation. One of the services provided by the corporation was property management. Rents and security deposits were collected from tenants of residential leases on behalf of property owners. In some cases, Respondent McVety was acting as an agent on behalf of property owners through the corporation. In other cases, Respondent McVety or the corporation was the actual property owner. When Respondent McVety took over the management of the corporation after his stock purchase, he noticed that the escrow account into which security deposits were placed, was a non-interest bearing account. On January 23, 1989, the escrow account was changed by the Respondent from an non-interest bearing escrow account to an interest bearing account. The tenants were not notified that their security deposits were now bearing interest. On March 17, 1989, a routine audit was conducted of the Respondent's escrow accounts. During the audit, it was discovered that one hundred and seventeen of the one hundred and thirty leases stated that the security deposits were being held in an non-interest bearing account. The leases which stated that the deposits were in an interest bearing account were signed after the Respondent purchased the corporation. The one hundred and seventeen leases with a non-interest bearing escrow were signed by the tenants prior to the stock transfer. There were no allegations that interest had actually been paid by the bank on the escrow account or that there had been any failure by the Respondent to account for the interest to the tenants, the actual owners of the funds. In mitigation, the Respondent stated that once he was made aware of the problems and truly understood the Department's concerns, a letter was sent to each tenant explaining the placement of the security deposits into an interest bearing escrow account on January 23, 1989. These letters were sent on April 3, 1989. In addition, a new real estate lease was prepared on behalf of the corporation by an attorney. The purpose of the new lease was to explicitly state the rights and responsibilities of the parties regarding the interest on these accounts. In this case, no one was cheated, no secret commissions were earned, and the sums in question were trifling.
Recommendation Accordingly, based upon the foregoing, it is RECOMMENDED: That the Respondent McVety be found guilty of having violated Rule 21V- 14.014, Florida Administrative Code, and is therefore in violation of Section 475.25(1)(e), Florida Statutes. This violation was originally Count II of the Administrative Complaint. Counts I and II, having been withdrawn, are dismissed. That the Respondent McVety be issued a written reprimand as the penalty for the one violation. DONE and ENTERED this 30th day of January, 1990, in Tallahassee, Leon County, Florida. Copies furnished: John R. Alexander, Esquire DPR - Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 John A. McVety 3120 Grand Avenue Fort Myers, Florida 33901 Darlene F. Keller Executive Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 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 30th day of January, 1990. Kenneth E. Easley, Esquire General Counsel Department of Professional Regulation 1940 North Monroe, Suite 60 Tallahassee, FL 32399-0792
