The Issue The issue presented is whether Respondent should deny an application for a real estate broker's license on the grounds that the applicant pled nolo contendere to a crime involving moral turpitude, within the meaning of Subsection 475.25(1)(f), Florida Statutes (2004), was adjudicated guilty of the crime, and has not been rehabilitated.
Findings Of Fact Respondent is the state agency responsible for licensing real estate brokers and sales persons in the State of Florida, pursuant to Chapter 475, Florida Statutes (2003). Respondent has licensed Petitioner as a real estate sales person since July 1, 1996. Petitioner has also been licensed in the state as a mortgage broker since September 1, 1993. On June 25, 2004, Petitioner applied for a license as a real estate broker. On December 1, 2004, Respondent issued a Notice of Denial. The Notice of Denial proposes to deny the license application on specific grounds. The Notice limits the grounds for denial to those included in the following statement: The Florida Real Estate Commission has determined that the Applicant has been adjudicated guilty of crimes relating to the activities of a licensed broker or sales associate, and crimes of moral turpitude or fraudulent or dishonest dealing. Specifically it has found that the applicant . . . has been convicted of or found guilty of, or entered a plea of nolo contendere to: Contributing To The Delinquency of A Minor, 2001 During the hearing, Respondent stipulated that it does not seek denial of the application on the grounds that the alleged crimes relate to the activities of a licensed broker or sales associate or to fraudulent or dishonest dealing. Respondent relies solely on allegations that Petitioner pled nolo contendere to the misdemeanor charge of contributing to the delinquency of a minor; that the crime involved moral turpitude; and that Petitioner was adjudicated guilty and has not been rehabilitated.1 It is undisputed that Petitioner pled nolo contendere in 2001 to a first-degree misdemeanor in the Circuit Court of Charlotte County, Florida, for contributing to the delinquency of a minor. The factual allegations in the criminal proceeding were that Petitioner solicited a 13-year-old female (minor female) to pose topless or nude on August 2, 2001, when Petitioner was approximately 38 years old. It is undisputed that the minor female did not pose for Petitioner. The court adjudicated Petitioner guilty and withheld sentencing. Petitioner paid $353 in costs, served 75 hours of community service, and successfully completed probation of 12 months. The Notice of Denial does not allege that Petitioner actually committed the crime of contributing to the delinquency of a minor. Nor does the applicable statute require proof that Petitioner committed the acts alleged in the criminal proceeding as a prerequisite for denial in this proceeding.2 It is legally unnecessary to determine whether Petitioner is guilty of the crime to which he pled nolo contendere. The entry of the plea, by itself, is a sufficient statutory ground for the proposed denial. The plea does not operate statutorily as conclusive evidence that Petitioner committed the crime to which he pled nolo contendere.3 No finding is made in this proceeding that Petitioner either did or did not solicit the minor female. The court adjudicated Petitioner guilty, and this Recommended Order refers to the solicitation as the adjudicated solicitation. The threshold factual issue in this proceeding is whether the adjudicated solicitation involved moral turpitude. If so, it must be determined whether there is a rational connection between the moral turpitude and Petitioner's fitness to engage in the real estate business. If the requisite connection exists, it must be determined whether Petitioner has been rehabilitated and is not a "danger to the public." The adjudicated solicitation involved an act of moral turpitude. Solicitation of a 13-year-old female to pose topless or nude was a substantial deviation from the standard of conduct acceptable in the community, violated the duties owed to society, and was an inherently base or depraved act.4 The base or depraved nature of the adjudicated solicitation did not arise from a desire for monetary gain, as the motive typically is in other crimes, such as grand theft or the intent to sell controlled substances, that have been held to involve moral turpitude.5 Rather, the base or depraved nature of the adjudicated solicitation arose from an attempt to coerce the involuntary compliance of a minor female by exploiting her vulnerability; exploiting a financial relationship over which Petitioner enjoyed financial control; and exploiting a quasi- familial relationship in which Petitioner was imbued with the advantage of an authority figure.6 A person of common understanding would have known there was a substantial and unjustifiable risk that such conduct would encourage delinquency and that disregard of that risk was a gross deviation from an appropriate standard of conduct. At age 13, the minor female was nowhere near the 18 years of age required for legal majority. That vulnerability was accentuated during the adjudicated solicitation by Petitioner's age of 38. The minor female was also financially dependent on Petitioner for income as the family babysitter. Petitioner enjoyed the advantage of financial control of that relationship and possessed the power to terminate the relationship. Petitioner also enjoyed the benefit of an authority figure in a quasi-familial relationship. The minor female is the daughter of the brother of Petitioner's wife. The minor female is not legally the niece of Petitioner because the brother never married the mother of the minor female. The minor female is also a long-time friend of Petitioner's daughter. There is no direct evidence of actual intent to exploit the vulnerability of the minor female and any existing relationship. However, Petitioner should have known that the minor female was in a position of vulnerability and that the adjudicated solicitation necessarily exploited her vulnerability and the advantages he enjoyed in their relationship. A person of common understanding would have known there was a substantial and unjustifiable risk that the solicitation would tend to cause or encourage delinquency. The risk was of such a nature and degree that Petitioner's adjudicated disregard of that risk was a gross deviation from the appropriate standard of conduct.7 The moral turpitude evidenced by the adjudicated solicitation in 2001 is not rationally connected to the applicant's fitness to engage in the real estate business. Respondent admits that the adjudicated solicitation is not related to the activities of a licensed broker or sales associate and does not involve fraudulent or dishonest dealing. It is undisputed that the adjudicated solicitation did not impugn Petitioner's fitness to engage in the real estate business. From July 1, 1996, through the date of hearing, Petitioner has functioned as a licensed real estate sales person with no harm to the public before or after the adjudicated solicitation. Petitioner disclosed the adjudicated solicitation to Respondent sometime after June 25, 2004. Respondent did not prevent Petitioner from engaging in the real estate business as a sales person. Respondent cited no evidence or authority to support a finding or conclusion that the misdemeanor disqualifies Petitioner from performing the functions of a real estate broker, but does not disqualify Petitioner from performing the duties and responsibilities of a real estate sales person. As a mortgage broker, Petitioner maintains trust accounts and transfers client deposits to third parties, including surveyors and credit reporting agencies. The absence of a rational connection to the applicant's fitness to practice real estate imbues the allegation of moral turpitude with the potential for arbitrary and discriminatory denial of the license application.8 The potential for selective enforcement should be avoided. The issue of whether Petitioner has been rehabilitated is moot in the absence of a rational connection between an act of moral turpitude and the fitness to engage in the real estate business. If it were determined that a rational connection existed between the adjudicated solicitation in 2001 and the fitness of Petitioner to engage in the real estate business, Petitioner has been rehabilitated.9 Petitioner paid the required court costs, served the community service, and completed his probation. Petitioner is a father of three children, has been married for more than 16 years, is a licensed real estate sales person, a licensed mortgage broker, and has not exhibited a pattern or practice of violations before or after the incident on August 2, 2001. Rather, the incident in 2001 stands alone as the only blemish on an otherwise flawless professional record as a real estate agent and a mortgage broker. The issuance of a broker's license to Petitioner does not frustrate legislative intent. The issuance of a license does not expose the public to a dishonest real estate broker that engages in fraudulent practices. The crime for which Petitioner was adjudicated guilty does not impugn the honesty of Petitioner or his ability to deal fairly with the public in the real estate business.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a final order granting the license application. DONE AND ENTERED this 25th day of August, 2005, in Tallahassee, Leon County, Florida. S DANIEL MANRY 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 25th day of August, 2005. 1/ Transcript at pages 44-45. 2/ The last sentence in Subsection 475.25(1)(f), Florida Statutes (2003), states that the court record of conviction is prima facie evidence of guilt. However, the statutory language preceding the last sentence does not expressly require proof of guilt as a prerequisite for denial. The last sentence appears to be a vestige from former statutory language that required a plea of nolo contendere to be treated as a conviction. The legislature deleted the former statutory language from the current statute, but, so far, has not deleted the remaining vestige of the former statute. The issue is discussed further in the Conclusions of Law. If proof of guilt were a statutory prerequisite for denial, evidence Petitioner submitted to overcome the prima facie showing of guilt or to mitigate the prima facie showing of guilt is neither credible nor persuasive to the trier of fact. The relevant evidence consists of Petitioner's own testimony and hearsay statements that the testimony attributes to the minor female, members of her family, and others. The hearsay did not supplement or explain competent and substantial evidence within the meaning of Subsection 120.57(1)(c), Florida Statutes (2003). 3/ Cf. McNair v. Criminal Justice Standards and Training Commission, 518 So. 2d 390, 391 (Fla. 1st DCA 1987)(plea is not statutorily evaluated as conclusive evidence of the commission of wrongdoing but is, by itself, statutorily sufficient for disciplinary action). This issue is discussed further in the Conclusions of Law. 4/ Neither party cited an applicable statute or rule that defines moral turpitude. Judicial decisions generally hold that moral turpitude involves: . . . the idea of inherent baseness or depravity in the private social relations or duties owed by man to man or by man to society. (citations omitted) It has also been defined as anything done contrary to justice, honesty, principle, or good morals. . . . State ex rel. Tullidge v. Hollingsworth et al., 108 Fla. 607, 146 So. 660, 611 (Fla. 1933). 5/ Judicial decisions finding moral turpitude in the exploitation of others for monetary gain are discussed in the Conclusions of Law. 6/ Judicial decisions discussing exploitation of vulnerable persons in professional relationships are discussed further in the Conclusions of Law. 7/ Culpable knowledge is an element in the judicial definition of contributing to the delinquency of a minor. State v. Shamrani, 370 So. 2d 1, 2 n.3 (Fla. 1979); Kito v. State, 888 So. 2d 114, 116 (Fla. 4th DCA 2004). 8/ By analogy, the Florida Supreme Court has held that a rational connection to an applicant's fitness to practice law must be applied to the requirement for good moral character or the requirement could become "a dangerous instrument for arbitrary and discriminatory denial of the right to practice law." Florida Board of Bar Examiners Re: G.W.L., 364 So. 2d 454, 458-459 (Fla. 1978). 9/ Counsel for Respondent questioned Petitioner in an unsuccessful attempt to show that Petitioner currently lacks veracity and is therefore dishonest. Counsel stipulated that the grounds for denial do not include dishonesty or fraudulent practices. The attempt to show current dishonesty is relevant only to the issue of rehabilitation. See Transcript at pages 36-51. 10/ The agency action in McNair was mandatory but is discretionary in this proceeding. The substantially affected party in McNair pled nolo contendere to a felony while Petitioner entered a similar plea to a misdemeanor. However, those factual distinctions are not material to the absence in the applicable statute of the former statutory infirmity that spawned the requirement of proof of guilt in Ayala and Son. 11/ Unlike the facts in the instant case, the holding in some of the cited cases are arguably ambiguous in that the allegations recite all of the grounds in the applicable statute, and it is not clear in every case whether the decision is restricted to allegations of moral turpitude. COPIES FURNISHED: Barbara Rockhill Edwards, Esquire Department of Legal Affairs Office of the Attorney General The Capitol, Plaza Level 01 Tallahassee, Florida 32399-1050 Daniel Villazon, Esquire Daniel Villazon, P.A. 419 West Vine Street Kissimmee, Florida 34741 Guy Sanchez, Chairman Florida Real Estate Commission Department of Business and Professional Regulation 400 West Robinson Street, Suite 801N Orlando, Florida 32801 Leon Biegalski, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202
The Issue The issue is whether petitioner, a sales tax dealer, must pay taxes, interest and penalties for collecting sales taxes on certain nontaxable transactions and then failing to remit those funds to respondent.
Findings Of Fact Based upon all of the evidence, including the pleadings, filings, and stipulation of counsel, the following findings of fact are determined: On an undisclosed date, respondent, Department of Revenue (DOR), conducted an audit of petitioner, Blackshears II Aluminum, Inc. (Blackshears), a registered sales tax dealer located in Crystal River, Florida. The audit covered the period from June 1, 1985, through March 31, 1989. As a result of that audit, on December 27, 1989, DOR issued a notice of intent to make sales and use tax audit charges. After petitioner availed itself of various informal procedures, a notice of reconsideration (notice) was issued on January 7, 1992, imposing a final assessment of $623,131.69. This action prompted Blackshears to initiate this proceeding. Although the notice addressed five issues, only issue three is relevant to this proceeding. That issue is broadly defined in the notice as "whether taxes collected on nontaxable transactions are state funds." According to the notice, the issue should be answered in the affirmative because (e)very dealer in the State of Florida is an agent for the state in that it is their responsibility to collect and remit sales tax. Blackshears collected the funds in the name of the State of Florida and has presented no refund assignments from the purchasers to permit them to apply for refunds, therefore, the State of Florida is due the funds. If the Department were to permit the use of its name to unjustly enrich Blackshears, a continuing deception would occur. The parties agree that petitioner collected sales taxes on various transactions (real property contracts) during the audit period. Whether such transactions were subject to the sales tax is in dispute, but for purposes of resolving the issue presented here, the parties have agreed that the undersigned can assume that the transactions were nontaxable. It is further agreed that even though petitioner collected the taxes from its customers, it failed to remit them to the state, and it has likewise failed to furnish proof that it refunded those moneys to its customers. Accordingly, DOR's assessment seeks to collect those taxes together with interest and substantial penalties. The parties have also agreed that the portion of the total tax assessment attributable to real property contracts is $277,406.53. As of March 29, 1993, the assessment totaled $636,570.37, after the accrual of interest and penalties. However, petitioner has paid to the state $16,180.19, for which it should receive credit. During the audit period, Rule 12A-1.014(6), Florida Administrative Code, was in effect and provided as follows: (6) Whenever a dealer credits a customer with tax on returned merchandise or for tax erroneously collected, he must refund such tax to his customer before his claim to the State for credit or refund will be approved. Under the terms of this rule, which interpreted the provisions of Chapter 212, Florida Statutes, any moneys erroneously collected by a dealer as taxes were to be remitted to the state. However, if the moneys were refunded to the customer, the dealer could then receive a refund of the moneys previously paid or a credit towards other taxes due.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent enter a final order granting its motion for partial summary adjudication and sustaining the assessment on issue three of its notice of reconsideration, plus interest and penalties, less those taxes already paid and identified in paragraph 2 of the parties' joint stipulation. DONE and ENTERED this 3rd day of May, 1993, in Tallahassee, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of May, 1993. COPIES FURNISHED: Larry Fuchs, Executive Director Department of Revenue 104 Carlton Building Tallahassee, FL 32399-0100 Linda Lettera, Esquire 204 Carlton Building Tallahassee, FL 32399-0100 C. Lynne Chapman, Esquire Department of Legal Affairs The Capitol-Tax Section Tallahassee, FL 32399-1050 Harold F. X. Purnell, Esquire 315 South Calhoun Street Suite 500 Tallahassee, FL 32301
Findings Of Fact The Respondent Ben D. Harrell, is registered with the Real Estate Commission as a real estate salesman. Copies of the Administrative Complaint filed by the Commission were forwarded to the Respondent at the address he most recently provided the Commission. In addition, a copy of the complaint was hand served upon the Respondent. A copy of the Notice scheduling the final hearing was also forwarded to the Respondent at his last listed address. A Grand Jury for the United States District Court, Middle District of Florida, Jacksonville District, returned an indictment against the Respondent, charging him with knowingly making materially false statements in a Satisfaction of Mortgage submitted to the Federal Land Bank in violation of Title 18 United States Code, Section 1014. The Respondent was convicted of the charges and on May 13, 1977, he was adjudicated guilty and sentenced to serve two years in federal penitentiary, execution of the sentence being suspended, and the Respondent being placed on probation for a period of five years. The crime of which the Respondent was convicted involves dishonest dealing in connection with a real estate transaction, and is a crime involving moral turpitude.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby, RECOMMENDED: That a final order be entered finding the Respondent guilty of the charges alleged in the Administrative Complaint and suspending the Respondent's registration as a real estate salesman for a period of two years. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 27th day of July, 1978. G. STEVEN PFEIFFER Hearing Officer Division of Administrative Hearings 101 Collins Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Mark A. Grimes, Esquire Florida Real Estate Commission 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Ben David Harrell 900 S.W. 15th Terrace Fort Lauderdale, Florida 33312 ================================================================= AGENCY MEMORANDUM ================================================================= November 8, 1978 MEMORANDUM TO: Renata Hendrick, Registration Supervisor FROM: Mark A. Grimes, Staff Attorney RE: PD 3278 FREC vs. Ben David Harrell DOAH Case No. 78-835 Enclosed* is a copy of a Final Order suspending the above named Defendant's registration for a period of two years. Please mark your records accordingly. Mark A. Grimes MAG:lam * NOTE: The Agency Final Order is not available at the Division and therefore not a part of this ACCESS document.
Findings Of Fact At all times pertinent to the allegations contained here, the Respondents, Thomas C. Pluto, Kathleen M. Pluto, and Pluto Realty, Inc., were licensed as real estate brokers and a brokerage corporation respectively. On October 23, 1985, Karen S. Hicks, listed certain property owned by her, located at 1537 Oak Park Avenue, Sarasota, Florida, for sale with Allstar Realty of Sarasota, Inc., (Allstar), utilizing Annette Schmidt as broker. On or about November 25, 1985, Respondent Thomas C. Pluto entered into a contract for sale between himself/or assigns as buyer and Karen Hicks as seller. The contract was for the sale of the property mentioned above. Respondent, Thomas Pluto was representing an investor who was to be the actual buyer and Mr. Pluto neither intended nor desired to purchase the property for himself. Because of the unfavorable interest rate then existing on the mortgage in effect on the property, which resulted in a negative amortization and a less favorable purchase opportunity, the warranty deed, mortgage deed, and closing statement to be executed in closing of the contract of sale herein were to be back dated to September 12, 1985 in order to take advantage of certain peculiarities of the federal income tax law pertinent thereto. By Respondent's own admission, had this sale been consummated in this fashion, it would have constituted at least a conspiracy to defraud the U.S. Closing was held on December 27, 1985. Prior to the closing, the intended buyer of the property, Mr. Pluto's investor, backed out of the deal and Mr. Pluto so informed Ms. Hicks through her agent, Ms. Schmidt. Because Ms. Hicks was anxious to close, because of the Christmas season, and because Mr. Pluto felt that he still might be able to find an investor to take over the property, Mr. Pluto agreed to go through with the purchase and as a part of the closing, paid Ms. Schmidt a $1,000.00 split commission. When the documentation was prepared for the December 27, 1985 closing, Thomas C. Pluto was shown as the buyer, but the mortgage deed, the warranty deed, and the closing statements all reflected a date of September 12, 1985. These documents were drafted and prepared by Respondent, Kathleen Pluto, who received her instructions as to what date to utilize thereon from Respondent, Thomas C. Pluto. The date of September 12, 1985, was initially dictated by the accountant for the original proposed investor who stipulated that date be used in order to take advantage of certain tax advantages possibly involved. According to Mr. Pluto and Mrs. Pluto, independent of each other, Mr. Pluto never thought to change it, and she merely assumed the back date was still to be used. This back dating of documents was, however, even by admission by the Respondent, Thomas Pluto, an improper act. Since the closing did not go through, however, the significance of the back dating relates only to the issue of the intent of Mr. Pluto at the time he took title to the property. By the middle of February, 1986, Mr. Pluto was still unable to secure another buyer for the property and on February 21, 1986, he submitted a written request for an assumption package to the mortgagee, Cameron-Brown, Incorporated. This written request was followed up by a verbal request on February 24 and again on March 18 and April 8, 1986. The mortgage assumption package was ultimately received by Mr. Pluto on April 11, 1986 and was completed and returned to the mortgagee on April 15, 1986. It was, however, either never received or was misplaced by Cameron-Brown. On June 27, and again on July 8 - 21, 1986, another assumption package was requested which was received on July 23, 1986, and returned completed to the mortgage company on July 25, 1986. The assumption was ultimately finalized on August 12, 1986, with credit being given back to September 12, 1985, at the reguest of Ms. Hicks. In the interim, all mortgage payments were timely made by Mr. Pluto. The Respondents did not claim a tax deduction or any tax advantage on the basis of this transaction nor was it ever their intent that they gain a personal tax advantage from it. Petitioner alleges that Mr. Pluto left the original back date on the deed when he took title to the property to make the property more attractive to another buyer to whom the property could have been transferred and who could have taken advantage of the earlier date for tax purposes. Mr. Pluto, on the other hand, contends that was not his intention and that if that had been his intention, he would not have taken title to the property when he did in his own name because that would require another complete closing and the resultant additional fees and charges inherent therein. This would have made the property less desirable because of the already high interest rate, the negative amortization and other financial problems. In light of the above, it appears that Mr. Pluto was quite willing to participate in a potentially illegal scheme and at the time he executed the documents for the final closing, notwithstanding he claims he did not realize the date had not been changed, he was guilty of at the very least, culpable negligence and dishonest dealing by scheme. The fact that he paid the selling broker a commission after alleging he went through with the purchase as a favor to her, tends to weaken the credibility of his story.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that Respondent, Thomas C. Pluto's, license be suspended for 90 days and that he be reprimanded but that the execution of the suspension be stayed for one year with provision for automatic remission at the end thereof; that Respondent, Kathleen M. Pluto, be reprimanded; and that the charges relating to Pluto Realty, Inc., be dismissed. RECOMMENDED this 4th day of February, 1988, at Tallahassee, Florida. ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 4th day of February, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-3084 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. BY THE PETITIONER 1 Accepted and incorporated herein. 2&3 Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. 6&7 Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. 10&11 Accepted. 12 Accepted and incorporated herein. BY THE RESPONDENTS 1-3 Accepted and incorporated herein. 4&5 Accepted. 6-10 Accepted. Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. Accepted except for the words, "through inadvertence, oversight, or mistake" Rejected as contra to the evidence. Accepted except for the words, "by oversight and error" Accepted. 19&20 Accepted and incorporated herein. 21 Accepted. COPIES FURNISHED: James R. Mitchell, Esquire DPR, Division of Real Estate Post Office Box 1900 Orlando, Florida 32801 Robert P. Rosin, Esquire 1900 Main Street, Suite 210 Sarasota, Florida 34236 Kathleen M. Pluto, pro se 8415 Midnight Pass Road Sarasota, Florida 34242 Darlene F. Keller Acting Executive Director DPR, Division of Real Estate Post Office Box 1900 Orlando, Florida 32801
The Issue Whether Respondent committed the violations alleged in the Administrative Complaint? If so, what disciplinary action should be taken against him?
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made: The Department is a state government licensing and regulatory agency. Respondent is now, and has been since December 28, 1989, a licensed real estate salesperson in the State of Florida. He holds license number 0552966. From the time he received his license until April of 1991, Respondent was employed as a salesperson by National Real Estate Corporation (hereinafter referred to as "National"). During this period of time, William Landman was also employed as a salesperson by National and Steven Ruttenberg was National's owner and chief executive officer. National is no longer in existence. It was voluntarily dissolved in 1992. Ruttenberg now owns NFC Realty, Inc. (hereinafter referred to as "NFC"). Before leaving the employ of National, Respondent was involved in a real estate transaction for which he and National were due a commission. Only half ($3,500.00) of the total commission ($7,000.00) had been paid at the time Respondent left the employ of National. Sometime after his departure, while he was employed as a real estate salesperson by his current employer, Spectrum Realty, Inc. (hereinafter referred to as "Spectrum"), Respondent telephoned Michael Glusman to inquire about the unpaid balance of the commission (hereinafter referred to simply as the "commission"). Glusman represented the entity responsible for paying the commission. During their telephone conversation, Respondent told Glusman that he was now employed by Spectrum and no longer associated with National. Glusman, in turn, advised that he would need to have a letter from National authorizing him to pay the commission to Respondent. Following his telephone conversation with Glusman, Respondent spoke with William Landman about the commission. Landman was, at the time, as he still is today, NFC's qualifying broker and Steven Ruttenberg's business partner. Respondent told Landman that he would make the necessary arrangements to secure payment of the commission. Landman did not express any objection to Respondent taking such initiative. On or about May 22, 1992, Respondent drafted, and then typed on a sheet of paper with National's letterhead that he had in his possession, the following letter (hereinafter referred to as the "May 22 letter") to Glusman which purported to be from Ruttenberg: May 22, 1992 MICHAEL GLUSMAN Realty Investors, Inc. 3111 Stirling Road, Suite C-302 Ft. Laud. FL 33312 Dear Michael: With regard to the placement of a customer in WEST BOCA SQUARE, National Real Estate Corp. realizing that Mr. Jay Meitchik of Spectrum Realty, Inc. being the procuring cause will waive its right to the balance of the commission due. Thank you, Steve Ruttenberg, Pres. Respondent signed Ruttenberg's name on the May 22 letter and then mailed the signed letter to Glusman. Respondent did not have, nor did he have reason to believe that he had, permission to sign and send such a letter to Glusman on Ruttenberg's behalf. Glusman received the May 22 letter. After looking at it, he forwarded it to Steven Levin. Levin had "bought out" Glusman and, in so doing, had assumed responsibility for payment of the commission. On or about May 27, 1992, Levin spoke with Landman about the commission and the May 22 letter that Glusman had received concerning the matter. Following his discussion with Levin, Landman told Ruttenberg about the May 22 letter. That same day, Landman and Ruttenberg were faxed a copy of the letter. In early June of 1992, Levin paid the commission, not to Respondent, but to Ruttenberg, who had made known that the May 22 letter was sent without his knowledge and permission and that it did not accurately reflect his position with respect to Respondent's entitlement to the full amount of the commission. Shortly thereafter, Ruttenberg, accompanied by Landman, went to Respondent's office and personally delivered to Respondent his share of the commission. While they were there, they unsuccessfully tried to obtain information from Respondent concerning testimony he was going to give on behalf of two former National employees who had filed a lawsuit against Ruttenberg. 2/ Ruttenberg and Landman also discussed with Respondent the May 22 letter that Respondent had sent to Glusman regarding the commission. Although Ruttenberg and Landman had discussed the possibility of filing a complaint with the Department a short time after learning about the May 22 letter, it was not until after Respondent had given a deposition in the aforementioned civil action that such a complaint was actually filed. 3/ Following its receipt of the complaint, the Department commenced an investigation of the matter. The investigation led to the issuance of the instant Administrative Complaint. Respondent has not been the subject of any other administrative complaints issued by the Department.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law it is hereby recommended that the Florida Real Estate Commission enter a final order finding Respondent guilty of the violation alleged in the Administrative Complaint, suspending his real estate salesperson's license for a period of six months, and fining him in the amount of $1,000.00 payable within 30 days of the date of the entry of the final order. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 3rd day of November, 1993. STUART M. LERNER 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 3rd day of November, 1993.
The Issue The ultimate issue for determination at final hearing was whether Petitioner's application for licensure as a real estate salesperson should be approved.
Findings Of Fact In October 1992, Petitioner filed an application with Respondent for licensure as a real estate salesperson, together with the required fee. The application asked several questions, including in pertinent part: Question 9: if Petitioner had been "convicted of a crime, found guilty or entered a plea of guilty or nolo contendere (no contest), even if adjudication was withheld," and Question 13: if Petitioner had had a license to practice any regulated profession revoked upon grounds of fraudulent or dishonest dealing or violations of law. Petitioner responded in the affirmative to both questions and provided written documentation and statements regarding the questions. Petitioner attached to her October 1992 application for licensure various letters to support her application. The letters included one from her probation officer indicating her compliance with her probation; from the local board of realtors indicating that no complaints had been registered against Petitioner during her membership with them, which was from 1979 to 1982 and 1990 to 1992; and from her present employer who is a licensed real estate agent and has employed Petitioner since 1989. On October 21, 1992, Respondent denied Petitioner's application for licensure as a real estate salesperson. The denial was based upon her response to questions 9 and 13 on the application, specifically her 1991 conviction and sentence and the 1992 revocation of her real estate salesperson license. On May 29, 1991, Petitioner plead nolo contendere to three felony counts of grand theft in the third degree. She was placed on probation for five years with special conditions, and adjudication of guilt was withheld. The special conditions of Petitioner's probation were that she would make restitution in the amount of $19,864.52, that she would perform 500 hours of community service, that she would fully cooperate with the State Attorney's Office in the investigation of the criminal activity in which she was involved, and that the probation may be terminated, upon motion, after 30 months. The theft involved a scheme devised by Petitioner's "boss" to obtain funds, beyond entitlement, from the City of Miami. Petitioner was employed as a bookkeeper by an elderly center from 1986 to 1988, which provided transportation, lunches and recreational activities for senior citizens. The center received funds from the City of Miami to operate by being reimbursed for monies paid to vendors. From 1986 to 1988, the center was performing poorly economically. In order to obtain additional monies, the invoices of vendors who did business with the center were inflated or increased and submitted by the center to the City of Miami for reimbursement. As bookkeeper, Petitioner was instrumental in the scheme. The difference between the actual cost and the inflated cost was retained by Petitioner and her boss and distributed at the end of the year to the center's employees, including Petitioner and her boss. Petitioner and her boss controlled the illegally obtained funds. At the end of the center's budget year, which was June 30th of each year, the center was withholding back payments to the U.S. Internal Revenue Service (IRS), using the funds held to pay salaries. As a result, a debt to IRS was created, and when IRS attempted to collect on the debt in 1988, the scheme was discovered and stopped. Petitioner cooperated fully with the State Attorney's Office. At the time of her conviction, Petitioner was licensed by Respondent as a real estate salesperson. Less than a month after her plea of nolo contendere to the grand theft charge and sentence, in June 1991 Petitioner notified Respondent of her conviction and sentence in accordance with statutory provisions regulating the practice of her profession as a licensed real estate salesperson. No evidence of any other conviction was presented. Subsequently, on or about October 30, 1991, an administrative complaint was filed by Respondent against Petitioner based upon her conviction. Petitioner admitted the allegations contained in the administrative complaint. She saw no need to deny the allegations, since she had reported the incident to Respondent. To Petitioner's shock and surprise, in a Final Order dated February 14, 1992, Petitioner's license as a real estate salesperson was revoked by Respondent. Petitioner had been licensed for 13 years without a complaint being filed against her. On February 13, 1992, Petitioner's probationary terms were modified by the court due to her inability to pay the $19,864.52 restitution. The modification included, among other things, that Petitioner was only required to pay monthly the restitution to individuals, which totaled $1,700, that the restitution to the City of Miami could be paid through community service at $10.00 per hour for each month that Petitioner was unable to pay, and that probation could be terminated early after 30 months if restitution was paid in full. By March 9, 1993, Petitioner had completed 500 hours of community service in accordance with the original court order, and for compliance with the modified court order, she had completed 235 hours of community service and paid $125.00 restitution to individuals. Prior to her conviction and license revocation, in 1989. Petitioner was employed with a real estate broker at Allied Associates of the South, Inc. (Allied Associates), in Miami Springs, Florida, as a sales associate, and continued in that position until sometime in 1991 when, due to economic constraints on Allied Associates, the broker cut her staff, choosing a more experienced salesperson over Petitioner. During her employment as a sales associate, no complaints were received by Allied Associates against Petitioner, and no money which was entrusted to her was reported missing. Allied Associates received many complimentary remarks from clients and real estate brokers alike. Subsequently, in November 1991, the broker re-employed Petitioner as a sales manager at Allied Associates. Petitioner informed the broker of her conviction and the circumstances of her conviction. The broker has allowed Petitioner to manage the financial books of the business with no problems. And Respondent has audited Allied Associates' financial books without citing a problem. Furthermore, Petitioner has handled escrow deposits and cash without any problems. Since October 1992, Petitioner has been working with Allied Associates as a sales manager on a part-time basis due to financial constraints experienced by Allied Associates. She has continued to handle escrow deposits and cash without any problems. Moreover, the broker/owner of Allied Associates has no hesitation in putting Petitioner in a position of trust. Further, Petitioner has assisted in the guidance of Allied Associates' sales associates.
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 allowing Petitioner to take the real estate salesperson's examination. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 29th day of October 1993. ERROL H. POWELL 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 29th day of October 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-7368 Petitioner's proposed findings of fact. Petitioner's proposed findings of fact consists of one paragraph with several sentences. 1. Substantially adopted in findings of fact 2, 4, 5, and 7-14; but rejected, regarding the second sentence, as unnecessary to the determination of the issues of this case and rejected, regarding the sixth sentence, as constituting argument, conclusions of law, or recitation of testimony. Respondent's proposed findings of fact. Substantially adopted in finding of fact 1. Substantially adopted in findings of fact 1 and 4. Substantially adopted in finding of fact 4. Substantially adopted in finding of fact 10. Substantially adopted in finding of fact 10. Substantially adopted in finding of fact 11. Substantially adopted in finding of fact 9. Substantially adopted in finding of fact 9. Substantially adopted in finding of fact 9. Substantially adopted in finding of fact 9; but rejected, regarding notice and failure of Petitioner to appear at the informal hearing, as unnecessary to the determination of the issues of this case. Addressed in the Preliminary Statement of this Recommended Order. Addressed in the Preliminary Statement of this Recommended Order. Substantially adopted in finding of fact 5; but rejected, regarding the first sentence, as constituting argument, conclusions of law, or recitation of testimony and rejected, regarding the last sentence which indicates that only Petitioner received and used the monies, as contrary to the evidence present. Substantially adopted in finding of fact 8. Substantially adopted in findings of fact 12-14. Note: Respondent proposed finding of fact is very close to constituting recitation of testimony. Substantially adopted in finding of fact 13. Note: Respondent proposed finding of fact is very close to and constituting recitation of testimony. Addressed in the Preliminary Statement of this Recommended Order. Addressed in the Preliminary Statement of this Recommended Order. COPIES FURNISHED: Marina P. Cintron 151 Fairway Drive #2301 Miami Springs, Florida 33166 Manuel E. Oliver Assistant Attorney General 400 West Robinson Street, Suite 107 South Orlando, Florida 32801 Darlene F. Keller Division Director Division of Real Estate Department of Business and Professional Regulation Post Office Box 1900 Orlando, Florida 32802-1900 Jack McRay General Counsel Department of Business and Professional Regulation 1940 North Monroe Street, Suite 60 Tallahassee, Florida 32399-0792
The Issue The issue presented for decision herein is whether or not the Respondent, Frederick L. Lundeen, is guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction by misrepresenting that money he borrowed from a one Julie Couch would be used for the purchase of a lot but, instead, he utilized the money in connection with the purchase of a house for use by his family and for payment of other vacation and travel expenses and refuses to repay the loan, in a manner violative of Section 475.25(1)(b), Florida Statutes.3
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. Respondent, Frederick L. Lundeen, is a licensed real estate salesman and holds license number 0329068. On or about July 13, 1984, Respondent solicited and obtained $3,500 cash from Julie S. Couch (Couch) for the stated purpose of assisting Respondent in purchasing a lot on behalf of Keith and Beverly Rayburn, friends of the Couches. In connection therewith, Respondent executed and delivered to Couch a mortgage note dated July 13, 1984, to secure the $3,500 loan via certain real property owned by Respondent.4 Pursuant to the terms of the note executed by Respondent and given to Mrs. Couch, Respondent was to repay Couch the principal of $3,500 plus $1,000 interest due on or before July 27, 1984. On July 30, 1984, Respondent attempted to repay part of the loan via check dated July 30, 1984 drawn in the amount of $1,000. Respondent's check was returned unpaid by the Drawers Bank with the notification "insufficient funds." (Petitioner's Exhibits 3 and 4) Thereafter, Respondent advised Mrs. Couch that the money was used to pay for his moving, vacation and other relocation costs for his family. Keith Rayburn attempted to buy property from the Respondent which was owned by Southern Standards Corporation. At no time during the attempted purchase by Keith Rayburn did Respondent offer to loan him money to purchase a lot from Southern Standards Corporation. Respondent executed and drafted the terms of the note which was given to Julie Couch which memorialized the loan from Mrs. Couch to Respondent. In this regard, Respondent contends that Julie Couch's ex-husband suggested the terms and the rate of interest which he inserted into the note which memorialized the loan from Julie Couch. On the other hand, Julie Couch testified that it was Respondent who suggested the terms and the interest which he provided with the executed note given her. Based on all of the evidence introduced herein including the fact that Respondent misrepresented the purpose for which the money would be utilized, and his failure to call Gary Couch as a witness to substantiate his claim that it was he, Gary Couch, who suggested the terms under which the loan would be made, the testimony of Julie Couch in this regard is credited.5 Respondent has repaid approximately $1,250 of the $3,500 loan from Julie Couch. Respondent, based on advice of his counsel, refuses to repay any further amounts on this loan contending that the interest rates were usurious and, further, that the State, in the person of Petitioner, is attempting to use its "strongarm tactics" to exact money from Respondent which is a usurious transaction. Respondent also contends that because the interest rate charged by Mrs. Couch was in excess of 45 percent per annum, Mrs. Couch committed a third degree felony. As previously stated, the weight of the evidence reveals that it was Respondent who drafted the note and provided the terms for repayment. It is also clear that Respondent misrepresented to Mrs. Couch the purpose for which he would utilize the money that he borrowed from her. It is therefore concluded that by such acts Respondent engaged in acts of misrepresentation, false pretenses, trick and dishonest dealing in a business transaction.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is, therefore, RECOMMENDED: That the license of Respondent, Frederick L. Lundeen, be suspended for a period of one (1) year and that he be fined $1,000. RECOMMENDED this 21st day of October, 1985, in Tallahassee, Florida.6 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 21st day of October 1985.
Findings Of Fact At all times pertinent to the allegations contained in this Administrative Complaint, the Respondent was licensed as a registered real estate broker in the State of Florida. In the early part of 1982, Respondent entered into a partnership agreement for the purchase and operation of the Cleveland Street Apartments with several individuals including Mr. Bradwell, Mr. Boulson, Mr. Crouse, and Mr. Tafton (sp). Respondent was to be managing partner because of his status as a real estate broker responsible for the operation of the facility and the payment of all expenses including taxes. Periodically, the Respondent would notify the other partners of the status of their investment. This generally indicated a negative cash flow and required additional contributions from the partners in order to meet the expenses incurred in the operation. Specifically, among the obligations to be paid were county real estate taxes for the years 1983 and 1984. In response to Respondent's notification to the partners of the taxes due, each partner periodically forwarded his pro rata share of the expenses, including taxes, to the Respondent with the anticipation that these expenses would be met and the taxes would be paid. As it happened, however, when Mr. Boulson, one of the partners, went to the Palm Beach County Court House at some time in 1985 to inquire as to what the taxes for that year would be, he was advised that the 1983 and 1984 real property taxes on the property had not been paid and were delinquent. This came as a complete surprise to him, and he and the other partners were required to contribute additional funds to pay both the 1983 and 1984 property taxes and the interest accrued thereon. Respondent admits that he did not pay the 1983 and 1984 taxes as they were due. He contends, however, that because of the fact that the apartment was operated with a negative cash flow, and because of the fact that the other partners repeatedly made their makeup contributions after the fact and slowly, he was forced to advance the money for other expenses as far as he could and utilized the money when paid by the other partners for taxes, to make up the other expense shortfall that he could not or did not make. Respondent contends that if the other partners had paid their assessments in a timely fashion, the other bills could have been paid on time and it would not have been necessary for him to utilize the money contributed for tax payments for the payment of these other expenses. This argument is without merit. The accountant's testimony clearly shows that sufficient money was paid in by the partners to pay the expenses and that the inflow/outflow was in balance, assuming the taxes had been paid on time as required. The evidence is overwhelming that Respondent was derelict in his responses to his partners and in his availability to them when they attempted to contact him regarding apartment business. In addition, Mr. Sonderholm, the individual from whom Respondent and the other partners bought the property, and who held a purchase money mortgage on it, indicates that for the first year, Respondent faithfully made the mortgage payments on time. However, thereafter, he began to be delinquent in the payments and on at least five occasions, issued checks in payment of the monthly mortgage payment which were returned dishonored for non-sufficient funds. Each of these checks was in an amount in excess of two thousand dollars. Toward the end of the relationship, in August, 1985, Respondent submitted his last property operating statement to the partners which showed a net operating loss in excess of $800.00 for the period covered, along with a request that that sum be forwarded to Respondent for reimbursement of expenses. By the admission of Mr. Bradwell, this money was not paid to the Respondent because it was extremely difficult to contact him and repeated efforts by phone, mail, and in person at his office were unsuccessful. By this time, however, the property was being managed for the partnership by a different management agent and after Respondent stopped handling the property for the partnership, he was no longer furnished any statements regarding the partnership operations though he was officially still a partner. This was because, according to Mr. Bradwell, it was impossible to reach Respondent and no one knew where he was. There is, however, a letter from Mrs. Crouse, dated in October, 1985, which is addressed to Respondent at his address of record which he received. There is also evidence to indicate that other letters sent to him at this address by certified mail were returned undelivered. These letters were not offered into evidence, however, and there is no way to know if the nondelivery was due to an inadequate address or whether Respondent refused delivery. Respondent was not furnished tax form K-1 for his share of the partnership for 1985 in early 1986 because the other partners felt, after consultation with their attorney, that his unavailability, coupled with his failure to properly manage the funds of the partnership and his alleged misapplication thereof was sufficient to deprive him of his partnership interest. There is no evidence to indicate that Respondent failed to make 1985 tax payments as required. In 1984, Respondent entered into a partnership with James M. VanSleet to purchase and operate an apartment building in Lake Worth, Florida. Because Respondent was in the real estate brokerage business and operated a property management concern, he was given, as a part of his partnership function, the tasks of manager and rental agent for the building. This arrangement was, however, a partnership rather than a broker-client relationship. In his capacity as rental agent in May, 1984, Respondent rented a unit in the building to Anthony Grieco and received a check from Mr. Grieco in the amount of $900.00 which represented a $500.00 security deposit and the first month's rent in advance. Mr. Grieco occupied the premises until May, 1985 and upon moving out, requested that his security deposit be refunded. He was advised by the Respondent that an inspection was necessary and that if the inspection revealed no damage, the deposit would be refunded. Several days later, he was notified that the inspection was satisfactory and that the $500.00 would be refunded, however, repeated contacts both by Mr. Grieco and his father, as well as others on his behalf, failed to result in return of the deposit which has not been returned as of the date of hearing. In his efforts to secure the return of the deposit, Mr. Grieco was subjected to numerous delaying tactics such as being required to call back week after week because the refund check was not ready; a failure of Respondent to return calls left for him; and references to the other partner, Mr. VanSleet as the source of refund. Notwithstanding the fact that the $500.00 security deposit has not been returned to Mr. Grieco, there is no evidence as to what was done with it or whether it was misappropriated to Respondent's own use as alleged in the Administrative Complaint. Toward the end of 1985, Mr. VanSleet turned the operation of this building over to another rental agent. At that time, he had received several requests for the return of deposits which had been paid to Respondent and which Respondent had failed to reimburse. Mr. VanSleet's practice was to allow the tenant to remain an extra month in the unit without rent rather than pay back the cash deposit.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that Respondent's license as a registered real estate broker in Florida be suspended for a period of two years; that he be required to demonstrate to the satisfaction of the Division of Real Estate his continuing education in the ethics of the real estate profession; and that he pay an administrative fine of $2,500.00. RECOMMENDED this 16th day of March, 1987, at Tallahassee, Florida. ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 16th day of March, 1987. COPIES FURNISHED: Harold Huff, Executive Director Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Van Poole, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Arthur R. Shell, Jr., Esquire Division of Real Estate Post Office Box 1900 Orlando, Florida 32801 John E. Knowles 755 Huff Road West Palm Beach, Florida 33415 =================================================================
The Issue Should Respondent's license as a real estate broker be revoked, suspended or otherwise disciplined?
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: The Department is the agency charged with the responsibility of investigating and enforcing the provisions of Chapter 475, Florida Statutes. At all times material to this proceeding, Respondent was a licensed real estate broker in the State of Florida, issued license number 0152815 in accordance with Chapter 475, Florida Statutes. Robert L. Purlee and Doris A. Purlee (Purlees) conveyed certain real property located at Unit 1303-A, Jamestown Condominiums, within Pinellas County, Florida, to Ralph F. Marotte and Eve K. Marotte (Marottes), on June 18, 1993, for an agreed upon sum of $15,000, with installments due over a period of 120 months, at the rate of $181,99 per month, beginning July 15, 1993. Since there was no express language in the deed to express a contrary intent, the conveyance to the Marottes created an estate by the entirety which was not available to answer for the individual debts of either of the tenants. The Marottes executed a mortgage and ad promissory note creating a lien against the property in favor of the Purlees, to secure the timely payment of the sum owed by the Marottes. At the time the Marottes purchased the property in question from the Purlees, there were no other liens or encumbrances against the property. At the time the deed was recorded, there was two personal judgments filed of record against Ralph F. Marotte, individually, but no personal judgments filed of record against Ralph F. Marotte and Eve K. Marotte, jointly or as husband and wife, or Eve K. Marotte, individually. Since no copies of these judgments, certified or otherwise, were introduced as evidence, and David Eaton appeared to be confused about these judgments, this finding is based on the testimony of Eve K. Marotte which I find credible. On November 10, 1993, the Marottes authored and caused to be delivered to the Purlees a letter which provides in pertinent part: We are unable to financially own this unit, therefore, we wish to deed it back to you and your wife, and record it in the courthouse. Rather than go thru foreclosure proceedings and lawyer’s fees etc., thought the simplest best way for both of us is to just return the property back to you both, and have the tenant send her rent payment directly to you. We have prepared the deed - and after it is recorded - have the courthouse send it to you directly. (Emphasis Supplied) * * * On December 8, 1993, the Marottes authored and caused to be delivered to the Purlees a letter which provides in pertinent part: Attached is a copy of the Quit Claim Deed - which is being recorded and will be mailed to you directly. (Emphasis Supplied) * * * On January 6, 1994, the Marottes authored and caused to be delivered to the Purlees a letter which provides in pertinent part: We went to the courthouse to record the deed, and realized that we did not take the mortgage off, so we are enclosing a satisfaction of mortgage, so that we can turn the property back to you- and you will then own it free and clear as you did before. As soon as we received this paper from you, will turn over everything, to you, that is, keys, etc. (Inventory remains the same). (Emphasis Supplied) * * * From the notation on the quit claim deed it appears that the Marottes attempted to record the deed at the courthouse but changed their mind as indicated in the letter. The Purlees executed the satisfaction of mortgage and posted it with the United States Postal Service for delivery to the Marottes. Subsequently, the Purlees discussed the matter with their attorney, David A. Eaton, who advised the Purlees to have the satisfaction of mortgage retrieved from the postal service. This was accomplished, and the Marottes did not receive the satisfaction of mortgage. Therefore, the Marottes did not record the quit claim deed transferring title back to the Purlees. Based on the testimony of Eve K. Marotte which I find credible, Eve K. Marotte continued in her effort to deed the property back to the Purlees, and even discussed the possibility of satisfying the personal judgments against Ralph F. Marotte in the process. In fact, Respondent even arranged for the sale of the property but that did not prove fruitful either. At the time the Marottes attempted to deed the property back to the Purlees, the Marottes did not advise the Purlees of the personal judgments against Ralph F. Marotte, individually. Since the conveyance of the property to the Marottes created an estate by the entirety, the property would not have been subject to any judgments against Ralph F. Marotte, individually upon the Marottes deeding the property back to the Purlees. There was no intent on the part of the Respondent to “saddle” the Purlees with Ralph F. Marotte’s personal judgments. Likewise, there was no intent on the part of Respondent to mislead or misrepresent the circumstances surrounding the attempt to “deed back” the property or to induce the Purlees to execute a satisfaction of mortgage so that the Marottes could record such satisfaction or mortgage without recording the quit claim deed and thereby have the property free and clear of the mortgage. Although the Marottes did make some of the mortgage payments, they did not make all of the payments as contemplated by the mortgage and promissory note. Their failure to make mortgage payments was due to their financial condition and not that the Marottes were intentionally attempting to deprive the Purlees of the property without paying for the property. The Marottes collected some rent from the property but apparently did not apply this money toward the mortgage payment. However, there was no evidence, other than the requirement of making the mortgage payments, that the Marottes were required to pay the rent over to the Purlees. On or about November 6. 1995, the Purlees filed a complaint with the Circuit Court of the Sixth Judicial Circuit of the State of Florida, in and for Pinellas County, against the Marottes alleging, inter alia, that Respondent committed fraud and dishonest dealing in a real estate transaction. On a Motion for Summary Judgment filed by the Purlees, the court entered a Final Judgment Against Licensed Real Estate Broker, Eve K. Marotte, for Monetary Damages Arising Out of Fraudulent Conduct in a Real Estate Brokerage Transaction on March 1, 1996. Additionally, the court entered a Final Judgment Against Eve K. Marotte and Ralph F. Marotte for the total sum of $95, 454.95 which included $22, 284.54 in actual damages, $66,853.62 in trouble damages pursuant to Section 772.11, Florida Statutes, $5,250.00 in attorney’s fees, and $1,066.79 in taxable costs. Because of this judgment and other financial and personal circumstances surrounding the Respondent’s life at that time, the Respondent filed for bankruptcy which eventually “wiped out” this judgment. Subsequently, the Purlees filed a separate proceeding for foreclosure of the mortgage, and obtained title to the property by foreclosure sale on or about August 1997. Between the time of the initiation of the foreclosure proceeding and gaining title to the property, the Purlees had a receiver appointed to receive the rent on the property. Although David Eaton testified that the Marottes failed to turn over rents during this period, there is insufficient evidence to show that the Marottes received any rent during this period or that the property was rented at all times during this period. Clearly, after engaging an attorney and obtaining the large judgment, the Purlees were not interested in taking the property back without the judgment being satisfied. Likewise, it is equally clear that Respondent was not financially able to pay the judgment. Respondent did not intentionally or otherwise misrepresent the facts in order to induce the Purlees to accept the deed back and release her from her obligation, or act in a fraudulent manner in order to convince the Purlees to release Respondent from her obligation, or act dishonestly in her dealings with the Purlees.
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 both Count I and Count II of the Administrative Complaint. DONE AND ENTERED this 19th day of December, 1997, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE 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) 921-6947 Filed with the Clerk of the Division of Administrative Hearings this 19th day of December, 1997. COPIES FURNISHED: Henry M. Solares Division Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 Lynda Goodgame General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Geofrrey T. Kirk, Esquire Department of Business and Professional Regulation Division of Real Estate 400 West Robinson Street Suite N-308 Orlando, Florida 32801 Eve K. Marotte, pro se 2616 46th Terrace North St. Petersburg, Florida 33714
