Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Petitioner's 1978 cost report be modified consistent with the foregoing adjustments. DONE and ENTERED this 10th day of November, 1982, in Tallahassee, Florida. DONALD R. ALEXANDER 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 10th day of November, 1982.
The Issue Whether respondent violated Section 498.023, Florida Statutes, by offering or disposing of an interest in subdivided lands (Pinecrest Estates) without first registering it or delivering a public offering statement to the purchasers and, if so, what penalty should be assessed or affirmative action ordered.
Recommendation Based on the foregoing, it is RECOMMENDED: That the Division enter an order assessing a $10,000 civil penalty against respondent for its violation of Chapter 498 Florida Statutes; requiring respondent to fully disclose the adverse features of the Pinecrest Estates property to each of its prior purchasers, such disclosure to be accomplished in a manner approved by the Division; requiring respondent to offer and make full refunds to its prior purchasers who desire a refund, such refunds to be made in a manner approved by the Division and conditioned only on reconveyance of the land to the respondent or recission of the agreement for deed; and requiring respondent to record in the official records of St. Johns County, Florida, all outstanding agreements for deeds covering lots belonging to prior purchasers who, after disclosure, choose not to request refunds. DONE AND RECOMMENDED this 11th day of January, 1983, in Tallahassee, Florida. R. L. CALEEN, JR. 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 11th day of January, 1983.
Findings Of Fact Documents introduced into evidence revealed that the Respondent Jeremiah C. Clarke is a registered real estate broker and Clarke Real Estate is an entity registered as a partnership broker and authorized to act as such with the Commission. On or about September 15, 1975, Jerry Kent, a salesman with Respondent, Clark Real Estate, obtained an oral open listing from Esther Braverman on a condominium unit denominated as "Apartment B-804, 1111 Crandon Boulevard, Key Biscayne, Florida." Pursuant thereto, salesman Kent showed the condominium unit to Jacques Benoist and Jeanine Benoist, his wife, who executed a deposit receipt contract to purchase a condominium unit on September 27, 1975. Esther Braverman, the seller, executed the contract during October of 1975. The deposit receipt contract provided for a $10,000 earnest money deposit to be held in the escrow account of the law firm of Snider, Young, Barrett, and Tannenbaum, P.A., attorneys for seller Braverman. Said deposit was made on September 27, 1975, by delivering a check to attorney Bruce L. Hollander, a member of the firm, who deposited the deposit in the firm's escrow account. (See Commission's Exhibit No. 9). The deposit receipt contract also obligated the seller, Esther Braverman, to pay Respondent Jeremiah C. Clark a commission of $7,875. Specifically, the contract provides that "I, or we, agree to pay to the above assigned broker a commission for finding the above signed purchaser for the above described property, the sum of $7,875 . . . ." Closing took place on January 19, 1976, at the offices of Washington Federal Savings and Loan Association, Miami Beach, Florida, from whom the Benoists had obtained financing for the purchase. At the closing on January 19, 1976, Esther Braverman signed and delivered a warranty deed made out to Jacques Benoist and Janine Benoist, transferring the property to the Bravermans. The warranty deed was recorded with the clerk of the Dade County Circuit Court by the lending institution, Washington Federal Savings and Loan Association. (See Respondent's Exhibits 1 and 2) At the closing, Jeremiah Clark was given a check representing the commission to Clarke Real Estate in the amount of $7,875. Thereafter, Jerry Clarke was requested by the lending institution to hold the funds in escrow until the bank dispursed the mortgage proceeds. He was then told that the mortgage proceeds would be paid within the following week. Respondent Clarke agreed, pursuant to a request from the seller's attorney, Bruce Hollander, to hold the commission check until January 27, 1976, without depositing same. Mr. Clarke held the commission check until January 29, 1976, as agree. On that day, he dispursed the proceeds to salesman Jerry Kent and the balance was credited to Clarke Real Estate. The mortgage funds were never disbursed because the lending institution could not obtain a quit-claim deed from the seller, Esther Braverman's former husband and therefore in the lending institution's opinion, the defect was not discovered until after the closing. On May 6, 1976, attorney Hollander acting for his law firm and the seller sent Respondent Jeremiah C. Clarke and Respondent Clarke Real Estate a letter stating that the mortgage proceeds had not been disbursed by the lending institution and requested a demand for the commission check. The Commission takes the position that the closing which occurred on January 19, was an escrow closing and that the Respondent Jeremiah Clarke was not authorized to disburse the proceeds from the commission check until notification that the mortgage proceeds were disbursed by the lending Institution. The Respondents, on the other hand, took the position that their only obligation was to find a purchaser who was ready, willing and able to complete the transaction, which acts were consummated by their salesman, Jerry Kent. Based on my examination of the document introduced herein, and the testimony adduced during the hearing, the undersigned concludes that the Respondent's position that it was entitled to receive the commission monies here in dispute has merit. Although the Commission takes the position that an escrow closing occurred, an escrow has been defined as a written instrument which by its term imports a legal obligation and which is deposited by the grantor, promisor, or obligor, or his agent with a stranger or third party to be kept by the depository until the performance of a condition or a happening of a certain event and then to be delivered over to the grantee, promisee, or obligee. It cannot be seriously contended herein that the Respondent Clarke was acting as an escrow for himself when consideration is given to the above definition of an escrow. See Love v. Brown Development Company, 131 So. 144. It is further essential to an escrow that delivery of the instrument be to a stranger or to a third person, that is, to one who is not a party to the instrument, or a person so free from any personal or legal identity with the parties to the instrument as to leave them free to discharge his duty as a depository to both parties without involving a breach of duty to either. For example, a deed delivered to a grantee cannot be regarded as held in escrow. Here, Respondent Clarke was in no way acting for anyone other than himself or as agent for his salesman, Jerry Kent, both of whom had a direct stake in the commission proceeds. Additionally, upon examination of the deposit receipt contract, the broker became entitled to the commission proceeds when the buyer (purchaser) was found. Additionally, and as an aside, it was noted that the lending institution in fact recorded its mortgage the day following the closing This would lead any examiner of the public records to believe that the lending institution was satisfied with the title as conveyed on the closing date. It was further noted that the Respondents had no indication that there was a problem with the title until approximately five months following the closing. Finally, the undersigned received a letter from attorney Lipcon dated August 1, 1975, advising that the civil case which was pending before the Dade County Circuit Court involving similar issues as posed herein before the commission had been fully and finally settled. There was a stipulation for dismissal signed by attorneys for each of the parties including the attorney for the firm that made the complaint against the Respondents stating in essence that the monies paid to Respondent Clarke and which was retained by him as full and final settlement of his brokerage commission were to be retained by Respondent Clarke as final payment of his commission in connection of the sale of the subject condominium. For all of these reasons, I shall recommend that the complaint filed herein be dismissed in its entirety.
Recommendation Based on the Findings of Fact and Conclusions of Law as found above, it is hereby recommended that the complaints filed herein be dismissed in their entirety. Recommended this 23rd day of August, 1977, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings Room 530 Carlton Building Tallahassee, Florida 32304
Findings Of Fact The land encompassed within the mobile home park known as Mohawk Village was purchased by Winter Springs Mobile Home Corporation, a corporation owned and controlled by the Tanner family. The majority of the stock in Respondent is owned by the oldest son; another son is president of Respondent; and the father, L. William Tanner, served as "consultant" to the corporation. This tract was initially divided into some 700-odd lots which were being sold to the public in 1980 as mobile home sites. The land was purchased from North Orlando Sewer and Water Company, which agreed to provide sewer and water services to the subdivision and to have these facilities in place by January 1, 1981. Respondent never registered with the Petitioner in accordance with Chapter 498, Florida Statutes. North Orlando Sewer and Water Company failed to provide sewer service to this development and none of the home sites were available for occupancy January 1, 1981, as promised to buyers by Respondent. Without sewer service it became necessary to go to septic tanks and this required larger lots per mobile home site. The tract was replatted to provide 300-odd lots despite the previous sale of smaller lots to buyers. These buyers were advised their lots would have to be swapped and when some objected and demanded their money back, without success, Petitioner was made aware of the development and investigated. The investigation led to the entering of a Cease and Desist and Consent Order (Exhibit 1). Therein Petitioner essentially agreed to forego action against Respondent for prior violations of Chapter 498, which Respondent contended it was subject to; and Respondent agreed to cease all leasing until the site was ready for occupancy, to provide Petitioner with copies of all leases in effect, as well as copies of all future leases executed, to deposit funds received from buyers in escrow until after receipt of a certificate of occupancy, and to take necessary steps to ensure all future leases fall within the statutory exemptions set forth in Section 498.025(1)(g), Florida Statutes. L. William Tanner was paid a consulting fee by Respondent "in the ballpark of $100,000." In addition, he was to own the companies that provided utilities to the park (after default by North Orlando Sewer and Water Company), and furnished porches, decks, built walkways, roads, etc. Following the Consent Order funds were received payable to Tanner-controlled companies that were not deposited in the escrow account. These funds were not lease payments but came from the lessees for sewer and water hookups, porches, decks, etc. Mohawk Village received its first certificate of occupancy on 14 January 1982. Between 17 April 1981, when the Consent Order was entered, and 14 January 1982, lot leases were sold to Gould on 30 November 1981; to Herring on 12 September 1981; and to Roberts on 14 January 1982 (Exhibit 6). The sales to Gould and Herring were clearly during the period Respondent had consented not to sell leases. Exhibit 1 authorized Respondent to renegotiate and relocate current lessees to new mobile home sites under a plan to use alternate utility services from those initially to be provided by North Orlando Sewer and Water Company "if such plan is implemented at no additional cost to the individual lessees." Those who had bought leases under the original scheme agreed to pay $29 per month to lessor. Leases sold after the decision to use septic tanks where the number of lots was reduced from 700-odd to 300-odd, provided the lessees would pay the lessor $59 per month. Respondent advised the earlier lessees that they would have to pay $59 per month in lieu of $29. When they objected and demanded refunds of what they had paid, some of them were promised refunds but to date very few have received any refunds. Changing their rental fee from $29 to $59 violated the Consent Order. The only change in the lease before and after the execution of the Consent Order was the change of this monthly rental payment. Since the original lease did not qualify for exemption under Section 498.025(1)(g), Florida Statutes, the amended lease, which merely changed the monthly rental fee, did not qualify for exemption. Leases on these lots were sold at prices ranging from $1,000 to $7,000. At no time relevant hereto did Respondent hold a dealer's license to deal in or sell mobile homes (Exhibit 3) There was no valid reservation program established by Respondent pursuant to Section 498.024, Florida Statutes, nor did Respondent apply for or receive approval of a public offering statement for Mohawk Village (Exhibit 2). All leases sold provided, in addition to a habitable lot, that the seller would provide recreational facilities. Those leases sold in 1980 promised a lot on which the buyer could move his mobile-home by January 1, 1981. Not only was the deadline missed but also Respondent has provided no recreational facilities. One witness who sold her home and bought a mobile home could not move it to the site in accordance with the contract because of lack of utilities and was forced to acquire another residence. Although proper demand was made she has been refunded none of her purchase money. According to his testimony, L. William Tanner has developed about one hundred subdivisions throughout the United States since 1946. Some 20 such subdivisions have been developed by him in Florida. He is aware of the Florida statutes regulating the subdivision and sale of lands, and contends that the Mohawk Village subdivision is exempt because Petitioner does not have jurisdiction over 99-year leases. He further contends that the monthly rental payments of $29 or $59 for 99 years brings the price paid for the lots to more than $50,000, thereby exempting them from the provisions of Chapter 498. Prior to the commencement of this hearing, Mohawk Village was transferred to Gould, who had been involved in supplying mobile homes to lot purchasers in the park. According to Tanner's testimony "it was not much of a sale" with him insisting Gould and Mohician Valley (apparently the new name for the mobile home subdivision) acknowledging existing mortgage, the Consent Agreement with Petitioner, and the obligation to refund the monies. No documentary evidence was presented to show that Tanner or his immediate family does not continue to own controlling interest in this mobile home park.
