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, Hudson Oil Company, is the owner of a retail gasoline outlet located at 1000 Ninth Street North, St. Petersburg, Florida. John H. Newburn is the manager of Respondent's retail station. On August 25, 1989, Petitioner, Department of Agriculture and Consumer Services' inspector, Henry J. Crafa, made a routine inspection of Respondent's retail gasoline station and took a sample of the unleaded, regular and premium unleaded gasolines. Inspector Crafa submitted the samples taken from Respondent's facility to Petitioner's laboratory for analysis. The results of Petitioner's laboratory analysis revealed that the unleaded and premium gasoline contained ethanol. Additionally, the lab analysis revealed that Respondent's regular gasoline contained water. The lab analysis revealed that Respondent's premium unleaded had an Antiknock Index of 91.6, whereas the posted Antiknock Index was 93.0. This indicates that the Antiknock Index of the premium unleaded fuel was 1.4% less than the Antiknock Index which was displayed on the dispensing tank. The lab analysis also revealed that the Respondent's unleaded gasoline contained 10.5% ethanol and the premium unleaded gasoline contained 8.8% ethanol. At the time of Petitioner's inspection on August 25, 1989, there were approximately 8,000 gallons of unleaded gasoline and approximately 2,000 gallons of premium unleaded gasoline in Respondent's dispensing tanks, and for both grades of gasoline, the retail price per gallon was in excess of $1.00. More than 2,000 gallons of gasoline was sold to retail customers at a price in excess of $1.00 per gallon. At the time of Inspector Crafa's inspection, Respondent's fuel tanks failed to display on the upper one-half of the front panel, in a position clear and conspicuous from the driver's position, that its unleaded and premium unleaded gasoline contained ethanol. On August 31, 1989, Petitioner issued a "Stop Sale Notice" for Respondent's unleaded and premium unleaded gasoline. In lieu of confiscation, and in order to gain release and possession of its unleaded and premium unleaded gasoline, Respondent entered into a release notice and/or agreement with Petitioner whereby Respondent posted a $1,000.00 bond in lieu of confiscation of its gasoline.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that: Petitioner enter a Final Order denying Respondent's request for a refund of the $1,000.00 bond that it posted in lieu of confiscation or its fuel products.1 DONE and ENTERED this 2nd day of November, 1990, in Tallahassee, Leon County, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of November, 1990. Copies furnished: Clinton H. Coulter, Jr., Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32399-0800 John H. Newburn 1000 Ninth Street North St. Petersburg, Florida 33705 Mary Hudson Hudson Energy Corporation Post Office Box B Kansas City, Kansas 66103 Honorable Doyle Conner Commissioner of Agriculture The Capitol Tallahassee, Florida 32399-0810 Mallory Horne, Esquire General Counsel Department of Agriculture and Consumer Services 515 Mayo Building Tallahassee, Florida 32399-0800 Ben Pridgeon, Chief Bureau of License & Bond Department of Agriculture and Consumer Services 508 Mayo Building Tallahassee, Florida 32399-0800
The Issue The issue in this case is whether or not Petitioner is entitled to a refund of the bond it posted in lieu of confiscation of allegedly mislabelled gasoline products.
Findings Of Fact Petitioner, AGI Service Corporation, owns and operates a Citgo service station located at 1599 West Flagler Street in Miami, Florida. The service station sells regular unleaded, unleaded plus and unleaded premium gasoline to the public. On February 18, 1991, James Carpinelli, the Respondent's inspector, visited the station to conduct an inspection and obtain samples of the gasoline Petitioner was offering for sale to the consuming public from its tanks and related gasoline pumps. Mr. Carpinelli took samples of all three types of gasoline offered for sale by Petitioner. The samples were forwarded to the Respondent's laboratory and were tested to determine whether they met Departmental standards for each type of gasoline. The Petitioner's "premium unleaded" pump indicated the octane or Anti Knock Index of the gasoline was 93. The "regular unleaded" pump indicated that the octane level was 87. The laboratory analysis of the samples revealed that the octane level of the gasoline taken from the "premium unleaded" pump was 87.4. The octane level of the gasoline taken from the "regular unleaded" pump was 93.0. Upon discovering the discrepancy in the octane levels, the Respondent seized the gasoline and immediately allowed the Petitioner to post a bond in the amount of $1,000. Upon the posting of the bond, the product was released back to the possession of the Petitioner and was allowed to be sold after the pumps were relabelled. Petitioner acquired ownership of the service station four days prior to the time of the inspection. At the time they opened the station, the new owners labelled the pumps based upon the information provided to them by the prior owners. The new owners had limited experience in the petroleum business and followed the guidance of the prior owners regarding labelling the pumps. It is clear that the pumps were inadvertently mislabelled based upon the information provided by the prior owners. The new owners sold "premium unleaded" at the price of "regular unleaded" and visa versa. Because more "premium unleaded" was sold at the price for regular, Petitioner lost money as a result of the mislabelling. The Department seeks to assess the full amount of the bond against the Petitioner in this proceeding. Respondent calculated the number of gallons of mislabelled gasoline that was sold based upon a delivery date of February 13, 1991. Those calculations indicate that 2,498 gallons were sold at a price of $1.259 per gallon. However, Respondent's calculations appear to begin at a time prior to Petitioner's ownership of the station. No evidence was presented as to how many gallons were sold while Petitioner owned the station. In addition, it is not clear when the mislabeling was done. Thus, no clear evidence was presented as to how many mislabeled gallons were sold by Petitioner.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Department of Agriculture and Consumer Services enter a Final Order granting the request of the Respondent for a refund of the bond posted and that the Department rescind its assessment in this case. DONE and ENTERED this 4th day of October, 1991, at Tallahassee, Florida. J. STEPHEN MENTON 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 4th day of October, 1991. COPIES FURNISHED: LOUIS PASCALI AND DONATO PASCALI QUALIFIED REPRESENTATIVES AGI SERVICE CORPORATION 1599 WEST FLAGLER STREET MIAMI, FL 33147 JAMES R. KELLY, ESQUIRE DEPARTMENT OF AGRICULTURE AND CONSUMER SERVICES ROOM 514, MAYO BUILDING TALLAHASSEE, FL 32399-0800 HONORABLE BOB CRAWFORD COMMISSIONER OF AGRICULTURE DEPARTMENT OF AGRICULTURE AND CONSUMER SERVICES THE CAPITOL, PL-10 TALLAHASSEE, FL 32399-0810 RICHARD TRITSCHLER, GENERAL COUNSEL DEPARTMENT OF AGRICULTURE AND CONSUMER SERVICES 515 MAYO BUILDING TALLAHASSEE, FL 32399-0800 BRENDA HYATT, CHIEF BUREAU OF LICENSING & BOND DEPARTMENT OF AGRICULTURE AND CONSUMER SERVICES 508 MAYO BUILDING TALLAHASSEE, FL 32399-0800
Findings Of Fact The Petitioner, the State of Florida, Department of Agriculture and Consumer Services, is an agency of state government charged, among other responsibilities, with establishing and enforcing standards related to quality of motor fuels, as pertinent hereto, the standard for volatility contained in Rule 5F-2.01(1)(c) 2, Florida Administrative Code. The Petitioner has charged that the Respondent has technically not met this standard with fuel sold at the two stores, one in Tampa and one in Winter Haven, Florida, because the subject product (which contained ethanol) does not comply with that standard which states that the fuel should be 50 percent evaporated at a temperature of not less that 1700. There is no dispute that the fuel involved did not meet this standard because it was ethanol enriched and was intended to be sold as such by the Respondent. The notice of stop sale was filed herein because this product, which did not comply with the standard for regular or unleaded gasoline, was not labeled to disclose that it was other than unleaded gasoline, that is gasoline containing ethanol. The Petitioner however withdrew its allegation that "super unleaded gasoline" enriched with ethanol was sold in an unlabeled fashion. The Respondent is a corporation authorized to do business in Florida, headquartered in Dallas, Texas. It recently elected to convert many of its gasoline outlets to sell ethanol enriched gasoline, which is characterized by a higher per gallon profit-margin and a higher octane than regular unleaded gasoline. Thus, a memorandum was sent from the Respondent's home office in Dallas, Texas, to all the Respondent's district managers and zone managers providing them with detailed instructions for conversion of stations from selling non-enriched unleaded gasoline to ethanol enriched gasoline, including detailed instructions on preventing adulteration by water in underground tanks, as well as detailed instructions regarding proper labeling and disclosure of the contents of the new type fuel to consumers. Some 130 retail outlets in Florida were converted to sell the ethanol product and booklets were published and distributed to be provided to customers to explain the characteristics of the ethanol fuel to customers. There is no dispute that a good faith effort was consistently followed to adequately disclose the characteristics of the fuel to customers and to properly label the pumps. The Respondent's Tampa store converted to ethanol product on March 26, 1983, and received its first load of ethanol enriched gasoline that day. It was cited or notified to stop sale by the Petitioner on March 29, 1983, because the pumps through which the product was dispensed were mislabeled. The parties agree that this was due to a communication failure between the regional office in Orlando and that station and that the clerk at that Tampa store simply did not get notified to change the labeling on the pumps before the Petitioner observed the violation some two days later and ordered sale of the product stopped. A similar situation is true of the Winter Haven retail outlet which sold ethanol enriched products without disclosure labeling on the pumps. In this instance the labeling had been placed on the pumps, but had been torn off by person unknown and the notice to stop sale was issued against the Respondent with regard to that store before new labeling could be properly placed on the pumps. There is no question, and indeed the parties have stipulated, that the two violations which occurred were inadvertent, and due, with regard to the Tampa instance, to a lack of communication between the Respondent's regional management office and the retail outlet involved, such that proper labeling did not get placed on the pumps timely. With regard to the Winter Haven facility, there is no dispute that the labeling was timely and properly done when the first load of fuel was placed in the underground tanks for sale, but that persons unknown wrongfully removed the labeling. There is no evidence to establish that any such violations have been committed by the Respondent in the past. There is no question that enough of the product was sold to the public to exceed the $1,000 bond posted in lieu of confiscation. It was also established that the violations were inadvertent and were not perpetrated through any intent or scheme to defraud the consuming public.
Recommendation Having considered the foregoing Findings of Fact and Conclusions of Law, the candor and demeanor of the witnesses and the pleadings and arguments of the parties, it is RECOMMENDED: That the Respondent be required to forfeit $250 of the $1,000 bond posted and that the remaining $750 be returned to the Respondent. DONE and ENTERED this 28th day of October, 1983, in Tallahassee, Florida. P. MICHAEL RUFF, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of October, 1983. COPIES FURNISHED: Frank Graham, Esquire Department of Agriculture Mayo Building Tallahassee, Florida 32301 Debbie Hunn, Esquire 5500 Diplomat Circle Suite 105 Orlando, Florida 32810 The Honorable Doyle Conner, Commissioner Department of Agriculture and Consumer Services The Capitol Tallahassee, Florida 32301
Findings Of Fact On June 14, 1982, James Hall, an employee of the Petitioner, made a routine inspection of the Respondent's gasoline service station located at 545 East Tennessee Street, Tallahassee, Leon County, Florida. This service station is in the business of selling gasoline to the motoring public. One of the products being sold at the time of inspection was Top Grade Super Regular Ethanol Enriched gasoline, which is a leaded fuel with components of gasoline and an enriching agent, alcohol. (The exact money amount of product that had been dispensed prior to the check was not established in the hearing, but by Respondent's position at the hearing, it was at least $1,000.00.) This fuel was sampled by Hall and returned for laboratory testing to be performed by the agency. That laboratory testing established that the 50 percent evaporated temperature for the fuel was less than 1700F. The reading was l540F, and a subsequent reexamination of the fuel sample indicated that the 50 percent evaporated temperature reading was I520F. Hall returned to Respondent's service station on June 15, 1982, and advised the proprietor of the problem with the evaporation temperature. At this point in time, 3,325 gallons of fuel remained in the tank from which the sample was taken. A Stop Sale Notice was placed against Respondent, and in lieu of confiscation of the fuel, which value was in excess of $1,000.00, Respondent was allowed to post a $1,000.00 bond and the fuel `gas released to be sold as regular leaded gasoline. Regular leaded gasoline is a product of lesser quality than Top Grade Super Regular Ethanol Enriched. Respondent, on the part of its officials, asked for a formal Subsection 120.57(1), Florida Statutes, hearing and that hearing was conducted on November 3, 1982, as described. The adverse effects of a violation of the 50 percent evaporated temperature, include drivability of an automobile, in that there is a delay or hesitation during the operation of the automobile; stalling, i.e., the engine shutting down, and problems with "vapor lock" in high ambient temperature situations. "Vapor lock" is an undesirable condition related to engine performance in an automobile. Although Respondent's employees had mixed gasoline and alcohol in its tank on the premises to achieve the blend Top Grade Super Regular Ethanol Enriched in its past operations, the fuel that was sampled in this case had been purchased from a jobber/wholesaler, already blended. Moreover, there was no indication that Respondent had deliberately attempted to sell substandard fuel to the consuming public.
Findings Of Fact The Golden Lariat is a service station in the business of selling regular, regular unleaded, and unleaded premium gasoline to the public. Each type of gasoline is stored in separate underground tanks by the Golden Lariat at its place of business at the intersection of State Road 69 and Interstate 10 in Jackson County, Florida. On July 23, 1987, James Hall visited the station to do an unannounced routine inspection of the premises. When he pulled up in his vehicle, he saw a hose running from the unleaded regular tank to the unleaded premium tank. The hose was connected to a small pump which in turn was hooked to Respondent's 12 volt battery. The pump was not running at the time Mr. Hall conducted his inspection. In view of what he had witnessed, Mr. Hall decided to check the gasoline Respondent was offering for sale to the consuming public from its tanks and related gasoline pumps. Mr. Hall was particularly interested in the results the lab would obtain on the premium-unleaded gas. He took samples of all three types of gasoline offered for sale by Respondent. The samples were forwarded to the Department's laboratory in Tallahassee and were tested to determine whether they met departmental standards for each type of gasoline. The antiknock index or octane rating that the premium unleaded gasoline tested at was 88.6 or 2.4 units lower than departmental requirements. The premium unleaded should have had an octane rating of 91 or higher in order to meet departmental standards. The results strongly indicated that the unleaded premium had been mixed with a lower octane gas such as regular unleaded, thereby yielding a lower average octane rating for the premium unleaded. The regular unleaded gasoline had an octane rating of 87.3. When Mr. Hall questioned one of the owners of the Golden Lariat, Mr. Bowan, Mr. Bowan indicated he was pumping water with the pump. Mr. Hall testified that pumping water would not be unusual since the station had had problems with water infiltration into its gasoline storage tanks in the past. However, an owner would not pump water from one tank into another tank as was indicated by what Mr. Hall had seen. The evidence clearly establishes that the Golden Lariat intentionally mixed its unleaded premium with its unleaded regular gasoline. This was done in an attempt to sell an otherwise cheaper and lower grade gasoline to the consuming public compared to the gasoline the Golden Lariat represented the consumer was buying. In light of the above facts the Department elected to allow the Golden Lariat to post a $1,000 bond in lieu of confiscation of the 1,700 gallons of gas in the unleaded premium tank. The bond was posted on August 24, 1987, and the gasoline was subsequently removed. No evidence was presented by petitioner as to the amount of gasoline sold by respondent out of the unleaded premium gasoline tank. However, Respondent did not appear at the hearing after notice was mailed to him on March 22, 1988. The notice was mailed well in advance of the hearing and afforded Respondent adequate warning of the upcoming hearing. By failing to appear at the hearing after adequate notice, Respondent is deemed to have abandoned its claim to a refund; and therefore, Respondent is not entitled to a refund of any portion of the bond it posted in lieu of confiscation. Rule 22I-6.022, Florida Administrative Code.
Findings Of Fact On June 8, 1982, a super ethanol enriched regular gas sample taken from Car-Go station No. 9840 owned by Respondent was subsequently tested and found to be below the 50 percent distillation temperature specified by the regulations. A Stop Sale Notice was issued on June 11, 1982, and on June 14, 1982, Respondent posted a $1,000 bond and the gasoline was released to Respondent to be upgraded and again offered for sale. On June 9, 1982, a similar sample taken from Eastern station No. 2108 was tested, with similar results. Again a Stop Sale Notice and bond followed. On June 11, 1982, similar samples taken from Eastern station No. 2104 and San Ann No. 171981 were tested, with similar results. As a result of these samples showing nonconformity with prescribed standards, Respondent posted a $1,000 bond for each station. Accordingly, a total of $4,000 was posted for the four stations so the gasoline could be returned to the plant for upgrading to meet requirements. Respondent does not contest any of the above facts and contends only that it was ignorant of the requirements and did not intend to violate the law.
Findings Of Fact During a routine inspection on March 30, 1983, a sample diesel fuel taken from Respondent's place of business in Clearwater, Florida, was tested and was found to have a flash point of 660F. Normal flash point for diesel fuel is 1000F. A Stop Sale Notice was issued March 30, 1983, and sales from this tank were stopped. On March 31, 1983, Respondent posted a $1,000 bond in lieu of having the fuel confiscated. Before the Stop Sale Notice, 1,282 gallons of contaminated diesel fuel had been sold from this tank at a price of $1.099 per gallon.
Findings Of Fact Sunshine Jr. Stores, Inc., #214 is a service station in the business of selling regular leaded, regular unleaded, and unleaded premium gasoline to the public. Store # 214's place of business is located at the intersection of East Avenue and U.S. Highway 98 in Panama City, Florida. On August 6, 1990, James Wood, the Department's inspector, visited the station to conduct an inspection of the gasoline Respondent was offering for sale to the consuming public from its tanks and related gasoline pumps. Mr. Wood took samples of all three types of gasoline offered for sale by Respondent. The samples were forwarded to the Department's laboratory in Tallahassee and were tested to determine whether they met departmental standards for each type of gasoline. The Departmental testing revealed that the regular-leaded gasoline did not contain any lead. The pumps had been mislabeled at the station and the station was in fact selling regular leaded gasoline as regular-unleaded gasoline. Since the leaded gasoline did not contain any lead, it fell below Departmental standards for leaded gasoline. The store had sold 2467 gallons of the mislabeled product. In light of the above facts, the Department elected to allow the Sunshine-Jr. Store, #214, to post a $1,000 bond in lieu of confiscation of the gasoline. The bond was posted on August 9, 1990. The Department assessed Sunshine-Jr. Stores, Inc., #214 the retail value of the product sold, which is equal to the posted bond. The assessment is reasonable and conforms to the amount of assessments imposed by the Department in similar cases.
Recommendation It is accordingly, RECOMMENDED: That the request of Sunshine Jr. Food Stores, #214 for refund of the bond posted be DENIED and that the assessment by the Department of Agriculture and Consumer Services in the amount of $1,000 be sustained. DONE and ORDERED this 16th day of March, 1991, in Tallahassee, Florida. DIANE CLEAVINGER 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 18th day of March, 1991. COPIES FURNISHED: Milton Lawrence P. O. Box 2498 Panama City, Florida 32402 Clinton H. Coulter, Jr., Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32399-0800 Honorable Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, Florida 32399-0810 Richard Tritschler General Counsel 515 Mayo Building Tallahassee, Florida 32399-0800 =================================================================
