Findings Of Fact The Petitioner is licensed as a dealer of special fuel pursuant to Florida Statutes 206 and has been assigned license Number 1627. The pertinent sections of Florida Statutes which are applicable to this case are ss206.86(1), (6), (8), 206.87, 206.89, 206.93, 206.94 and Ch. 212. The pertinent rules of the Department of Revenue applicable to special fuels sales involved herein is 12A-2.03. The deposition of Albert Colozoff and all answers to interrogatories and responses to requests for admissions are admissible as evidence and are to be made a part of the record in this cause. The Petitioner sold special fuels to Zamora Truck and Car Services, Roberts Equipment Company and Florida Petroleum, Inc. Petitioner was assessed by the Respondent for tax on 1,979,201 gallons of special fuel sold by it and paid tax and interest as set forth in the letter attached hereto as Exhibit A. That no penalty paid on any of the tax paid pursuant to that letter. That Petitioner did not remit taxes that were due during the month the sales of special fuel were reported on any of the sale to Zamora, Roberts or Florida Petroleum or the remaining 1,417,263 gallons sold. Zamora and Roberts represented to Belcher that they were purchasing all special fuel from Belcher for exempt agricultural use. Due to past dealings and delivery of the special fuel to a farm, Belcher believed and relied upon the facts represented to it by Zamora and Roberts. However, Belcher did not obtain written documentation of this agricultural use from Zamora or Roberts and did not furnish the Department with any such written documentation. Belcher did not obtain resale certificates or exemption certificates or dealer license numbers from Zamora, Roberts or Florida Petroleum. Nor did the report forms filed by Belcher contain resale certificates, exemption certificates or dealer license numbers from Zamora, Roberts or Florida Petroleum. An employee of the Department advised Belcher that Zamora and Roberts were under investigation for fraudulent failure to report taxes. Belcher paid sales tax on sales of special fuel in the amount of $18,589.53 on the sale of 538,030 gallons of special fuel. Zamora is not a licensed dealer of special fuels. Florida Petroleum is not a licensed dealer of special fuel. Roberts is not a licensed dealer of special fuel. Belcher did not fraudulently file incorrect monthly special fuels reports. The Department of Revenue audited Belcher and computed tax, penalty and interest due as set forth in the documents attached hereto as Exhibit B. The Department of Revenue advised Belcher of its duties regarding reporting requirements in the letters from L. N. Thomas attached as Exhibit C.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is, RECOMMENDED: That Respondent's assessment be upheld with respect to Petitioner's tax deficiency, penalty and interest as set forth in the assessments with adjustments to be made for payments paid by Petitioner under the "sales tax" theory. DONE and ORDERED this 30th day of April, 1979, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings Room 101, Collins Building Mail: 530 Carlton Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: James R. McCachren, Jr., Esquire Ervin, Varn, Jacobs, Odom & Kitchen Post Office Box 1170 Tallahassee, Florida 32302 William D. Townsend, Esquire Assistant Attorney General The Capitol, Room LL04 Tallahassee, Florida 32301
Findings Of Fact The Respondent, J. C. Penny Company, Inc., operates an automobile service center at its store in the Sunshine Mall in Clearwater, Florida. The service center has a gas station which sells gasoline products to the general public. On or about February 4, 1981, a petroleum inspector of the Petitioner, Department of Agriculture and Consumer Services, took a gasoline sample for analysis of unleaded gasoline from the Respondent's gasoline station at the Sunshine Mall. This sample was tested in the Tallahassee laboratory and was found to contain lead contents in the amount of 0.60 gram per gallon in the no- lead gasoline sample. The standard for unleaded gasoline offered for sale in Florida is 0.05 gram of lead per gallon. On the basis of this information, a stop sale notice on the tank that dispensed the gasoline was issued on February 5, 1981 (Petitioner's Exhibit 1) The station manager was informed that he had several alternatives, including confiscation of the product, with the Respondent posting a bond in the amount of $1,000 for the release of the product to be sold as regular gasoline. Having elected this alternative, a "release notice or agreement" was entered into on February 5, 1981 (Petitioner's Exhibit 1). Petitioner received a bond in the amount of $1,000 from Respondent and this amount was deposited into the Gasoline Trust Fund.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Respondent be required to forfeit $500 of the $1,000 bond posted and the unforfeited $500 be returned to Respondent. DONE and ENTERED this 1st day of June, 1981, in Tallahassee, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 Filed with the Clerk of the Division of Administrative Hearings this 1st day of June, 1981. COPIES FURNISHED: Robert A. Chastain, Esquire Room 513 June, 1981. Mayo Building Tallahassee, Florida 32301 Donald E. Ford J. C. Penny Company, Inc. 27 Sunshine Mall Clearwater, Florida 33516
The Issue The issue is whether Petitioner is entitled to a refund of motor fuel taxes paid for motor fuel exported from Florida when Petitioner was not licensed as an exporter at the time of the transactions.
Findings Of Fact Petitioner is a Florida corporation engaged in the business of purchasing and reselling motor fuel. Petitioner, whose principle place of business is 1201 Oakfield Drive, Brandon, Florida 33509, does business within and without the State of Florida. Petitioner currently has a Florida Fuel Tax License, which is number 59-2150510. On April 5, 2004, and May 7, 12, and 13, 2004, upon Petitioner's orders, Kenan Transport loaded diesel fuel at the Marathon facility in Jacksonville, Florida, and delivered the fuel to Petitioner's Kingsland, Georgia, location. Daniel Way, the driver employed by Kenan Transport, delivered the April 5, 2004; May 7, 2004; May 12, 2004; and May 13, 2004, fuel loads to Petitioner's Kingsland, Georgia, location. 6. For the April 5, 2004; May 7, 2004; May 12, 2004; and May 13, 2004, fuel deliveries to Petitioner's Kingsland, Georgia, facility, Petitioner paid a total of $8,775.16 in Florida fuel taxes. The amount of Florida fuel taxes paid for each delivery was as follows: $2,192.99, for the April 5, 2004, delivery; $2,187.77, for the May 7, 2004, delivery; $2,187.20, for the May 12, 2004, delivery; and $2,187.20, for the May 13, 2004, delivery. At the time the four fuel deliveries noted in paragraphs 4 and 5 above were made to Petitioner's Kingsland, Georgia, facility, Petitioner did not have an exporter fuel license. Petitioner obtained an exporter fuel license that became effective December 1, 2004. The parties stipulated to the findings in paragraphs 1 through 9. Petitioner asserts that the Department should refund the fuel taxes it paid because, in the four transactions, Petitioner's account was mistakenly billed for the fuel. Gowan Oil Company (Gowan) is a distributor based in Folkston, Georgia, and has contracts with many fuel terminals in Jacksonville. Pursuant to an arrangement between Petitioner and Gowan, Petitioner did not usually buy fuel from any of the terminals in Jacksonville. Instead, Petitioner bought fuel for its truck stop in Georgia from Gowan, since Gowan could buy fuel at the Jacksonville terminals for less than Petitioner could. Depending on the price of fuel on a particular day, Petitioner would call Kenan Transport and tell the company to pick up fuel from a particular terminal in Jacksonville. The instructions relative to the above transactions were for the driver to pick up BP fuel and to put it on Gowan's account. Notwithstanding the specific instructions given to the driver, he made two mistakes with respect to the four fuel purchases. He not only mistakenly picked up the wrong fuel, Marathon fuel, but he also put the fuel he picked up on Petitioner's account, not on Gowan's account. The mistake made by the Kenan Transport driver is a common mistake made by transport drivers, who are "hauling out of multiple terminals every day." Drivers have loading cards for all of the accounts on which they pick up fuel. When picking up fuel, the driver should use the loading card which corresponds to the account for that particular load. In the four transactions that are at issue in this proceeding, the driver "loaded" the card for Petitioner's account, not the card for Gowan's account. Petitioner did not have an export license at the time of the transactions. Therefore, Marathon properly billed Petitioner for the Florida fuel taxes on the fuel that was picked up in Jacksonville, Florida, charged on Petitioner's account, and delivered to Petitioner's truck stop in Kingsland, Georgia. Petitioner tried unsuccessfully to have Marathon bill the subject fuel purchases to Gowan. If Gowan had been billed, it would not have been required to pay Florida fuel taxes on the four fuel purchases because it had an export license.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order denying Petitioner's application for a refund of fuel taxes. DONE AND ENTERED this 28th day of April, 2006, in Tallahassee, Leon County, Florida. S CAROLYN S. HOLIFIELD 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 28th day of April, 2006.
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 =================================================================
The Issue Was the amendment to Section 12B-5.01, Florida Administrative Code adopted on November 8, 1978, adopted in violation of the procedural requirements of Section 120.54, Florida Statutes? Is the amendment to Section 12B-5.01, Florida Administrative Code an invalid exercise of the Department's delegated legislative authority?
Findings Of Fact Miami Tiresoles, Inc. sells both new and retreaded tires for cars and trucks. The company also sells gasoline and diesel fuel. It is licensed by the Department as a dealer in special fuels. As far as this case is concerned special fuel is number 2 diesel oil. Unless an exemption is met each gallon of special fuel sold by MTS is taxed by the Department at a rate of 8 cents per gallon. The Department has given MTS a revised notice of proposed assessment of tax for the sale of special fuel in the amount of $4,551.88 plus a penalty of $455.48 and interest in the amount of $735.11 (through April 21, 1980). The tax figure on the assessment appears to reflect a typographical error. The Department's records (Exhibit A) indicate that for the period in question 2/ MTS sold 56,936 gallons of special fuel subject to tax according to the Department's interpretation of the law. If a tax at a rate of 8 cents per gallon is due, then the amount due should be $4,554.88 and not $4,551.88. The correct tax figure is reflected on the Department's work sheets but was probably misread when the figure was transferred to the revised Notice of Assessment issued on April 21, 1980. The foregoing assessment is based on MTS' invoices which reflect sales of special fuel to customers in amounts of more than 110 gallons at one time. Those sales were made to MTS customers who have filed with MTS a document called "Purchaser's Exemption Certificate". A typical example of such a certificate states: PURCHASER'S EXEMPTION CERTIFICATE The undersigned hereby certifies that the motor duel (sic) and/or special fuel pur- chased on 1-19-79 is for the following purpose as checked in the space provided. (X) Purchased for home, industrial, com- mercial, agricultural or marine purposes for consumption other than for the propul- sion of a motor vehicle. ( ) Purchased at bulk plant or terminal in volumes of not more than 110 gallons for delivery into a receptacle not connected to the fuel supply system of a motor vehicle for consumption other than for the pro- pulsion of a motor vehicle. Purchaser is aware that if this exemption if (sic) falsely claimed, or if this certi- ficate is not rescinded at the time he fails to quality (sic) for the exemption, he shall be liable for the taxes imposed under Chapter 206, F.S. Furthermore, by issuing this certificate the purchaser also certifies that he does not have any motor vehicles which use special fuel for propulsion. This certificate is to continue in force until revoked by written notice to MIAMI TIRESOLES, INC. Purchaser: Trade Name: A ACME SANDBLASTING, INC. Street Address: 9521 W. Oakmont Dr., Hialeah, Fla. 33015 BY: /s/ The industrial customers of MTS (that is those who have filed an exemption certificate) are engaged in the construction business. They use the diesel fuel to operate bulldozers, front-end loaders, back hoes, sandblasters and similar equipment. None of the fuel is used for the operation of motor vehicles on the public highways of Florida. All the fuel in question is sold on the premises of MTS. At the time of sale it is placed either in the fuel tank of a particular piece of equipment such as a back hoe, or it is placed in a fuel storage tank mounted on the back of a truck. The storage tanks are not connected so they can provide fuel for the propulsion of the truck. They are used to transport fuel to the purchaser's particular job site. The storage tanks have a capacity of between 100 to 300 gallons. MTS does not have delivery trucks of its own and has no facilities for taking fuel to its customers job sites. A single invoice of MTS which indicates a sale of 110 gallons of special fuel to an individual customer is frequently the result of a sale where multiple fuel tanks are filled at one time. For instance, the customer may have a back hoe sitting on the rear of a flat-bed truck. He will fill the fuel tank in his back hoe and then perhaps fill an additional 55 gallon drum or two which would be on the truck. This would occur all in one transaction. The reason why the Department seeks to tax special fuel sold by MTS to its industrial customers in an amount exceeding 110 gallons is because the fuel was placed in the customers' own fuel tanks on the premises of MTS and not on the premises of the customer or at the customer's job site. The amendment to Section 12B-5.01, Florida Administrative Code challenged by Petitioner here was adopted by the Governor and Cabinet, sitting as the head of the Department of Revenue, on November 8, 1978. No hearing was held on the amendment's adoption because no person requested one. Notice of the Department's intent to adopt the rule was given in the October 13, 1978 issue of the Florida Administrative Weekly. At the time the notice was published a copy of the amendment was available for inspection and copying by the public. The notice published in the Florida Administrative Weekly stated: DEPARTMENT OF REVENUE, DIVISION OF MISCELLANEOUS TAX, MOTOR FUEL TAX Rule 12B-5.01 TITLE: Specific Exemption PURPOSE AND EFFECT: To amend the rule which implements Subsection 206.87(4)(a) & (b), F.S. to clarify interpretation of the law. SUMMARY: Provides specifically the requirements necessary in order for the licensed dealer of special fuel to make an exempt sale for home, industrial, commercial, agricultural, or marine purposes and exempt sales of not more than 110 gallons at his place of business, and by cross reference, the records needed to be maintained by the licensed dealer to substantiate the sale. SPECIFIC LEGAL AUTHORITY UNDER WHICH THE ADOPTION IS AUTHORIZED AND THE LAW BEING IMPLEMENTED, INTERPRETED OR MADE SPECIFIC: SPECIFIC AUTHORITY: 206.14(1), 206.59, FS. LAW IMPLEMENTED: 206.87(4)(a)(b), FS. ESTIMATE OF ECONOMIC IMPACT ON ALL AFFECTED PERSONS: There will be no significant economic impact. IF REQUESTED, A HEARING WILL BE HELD AT: TIME: 10:00 A.M. PLACE: The New Capitol, Lower Level 3 DATE: November 9, 1978 A COPY OF THE PROPOSED RULE AND THE ECONOMIC IMPACT STATEMENT MAY BE OBTAINED BY WRITING TO: L. N. Thomas, Chief, Motor Fuel Tax Bureau, Department of Revenue, Carlton Building, Tallahassee, Florida 32304 Individual notices of the proposed rule making were not sent to licensed special fuel dealers in Florida. On October 10, 1978, the Department sent the following items to the Joint Administrative Procedures Committee: A copy of the proposed amendment to Rule l2B-5.01. The notice to appear in the Florida Administrative Weekly. The Economic Impact Statement. The "Summary and Justification Sheet" (apparently the Department's term for the facts and circumstances justifying the proposed rules). The following shows how the Department's amendment adopted on November 8, 1978, changed Section 12B-5.01, Florida Administrative Code. Words stricken were deleted; words underlined were added. 12B-5.01 Specific Exemptions. (1) - (2) - No change. HOMES, INDUSTRIAL. COMMERCIAL, AGRICULTURAL OR MARINE. Any sale of special fuel by a licensed dealer, regardless of quantity, when such fuel is to be consumed exclusively for home, industrial, commercial, agricultural, or marine purposes, is exempt from tax, provided the sale is made by a licensed dealer who delivers the fuel into the customer's storage facility, which must be located on the customer's premises, place of business, or job site. (Cross Reference - Rule 12B-5.03(1). (7)(b) - (6) - No change. (7) SALES OF 110 GALLONS OR LESS. A licensed dealer may deliver, at his place of business, tax free, not more than 110 gallons of special fuel to a person who is not a licensed dealer of special fuel, provided the fuel is placed into a receptacle which is furnished by the purchaser and which is not connected to the fuel supply system of a motor vehicle. (Cross Reference - Rule 12B-5.03(1), (7)(b) Any licensed dealer of special fuel who, at his place of business, delivers more than 110 gallons of special fuel to a person who is not a licensed dealer of special fuel, shall be liable for and shall pay to the state taxes, penalties and interest on the total quantity sold even though the fuel may not be ultimately used to propel a motor vehicle on the highway.
Findings Of Fact Albert Spain is an applicant otherwise qualified for licensure as a private employment agency/agent except for the lack of three years continuous experience immediately preceding his application, the question which is at issue in this case. Spain was employed with a trade association as a vice president for 15 years until December 31, 1976. His experience in this position meets the requirements of equivalent experience as an employment clerk and is accepted as such by the Division. Spain was employed from February 28, 1977, until March 31, 1978, with Life of Georgia in Orlando, Florida. Thereafter, Spain was employed as manager of an employment agency which experience is accepted by the Division as equivalent experience as an employment clerk. The head of the Life of Georgia agency and Spain's immediate superior, William Richardson, testified concerning Spain's employment. Richardson needed an agent supervisor for his agency to assist him in recruiting, training and supervising agents for the company's Orlando operation. Richardson met Spain and was impressed with his background, feeling that Spain could fill this position as agent supervisor. However, in order to fill this position, the incumbent must be a licensed insurance salesman and have experience in insurance sales. Richardson offered Spain a position as a salesman with the understanding that if Spain gained experience in sales and was licensed he would have the opportunity to become the agent supervisor if his performance was otherwise satisfactory. Spain accepted the employment, obtained his insurance license and worked as an insurance salesman for approximately one year. Richardson was satisfied with Spain's progress and would have considered Spain for the supervisor's job had Spain not left the agency. Although Spain's duties primarily related to sales, he also recruited salesmen, worked in training other sales people, and did other work as was assigned by Richardson. Certain of these duties involved work which would be the equivalent of that of an employment clerk; however, Spain spent only approximately 50 percent of his time in such duties.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, the Hearing Officer would recommend that the application of Albert Spain for licensure as a private employment agent/agency be granted. DONE and ORDERED this 20th day of February, 1979, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of February, 1979. COPIES FURNISHED: Gerald Curington Division of Licensing The Capitol Tallahassee, Florida 32304 Albert L. Spain 4264C Lake Underhill Drive Orlando, Florida
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 Whether the Department of Revenue's denial of Petitioner's application for a Florida fuel license should be upheld.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: On or about May 22, 2001, Armando Yzaguirre submitted to the Department a completed Florida Fuel Tax Application, Form DR-156, seeking licensure as a private carrier and wholesaler on behalf of Yzaguirre Oil Company, Inc. ("Yzaguirre Oil"). The application listed Mr. Yzaguirre as the president and sole stockholder of Yzaguirre Oil. Form DR-156 requests information about the applicant business and its principals, including a list of 33 questions requiring a "yes" or "no" answer from the applicant. Question number 33 asks: Have you or other owners, officers, directors, or stockholders with a controlling interest, been convicted of, or entered a plea of guilty or nolo contendere to, a felony committed against the laws of any state or the United States? Mr. Yzaguirre's sworn answer to Question number 33 was "yes." Mr. Yzaguirre provided the Department with no elucidation as to the circumstances of his admitted felony conviction. On or about June 22, 2001, Maria Yzaguirre, the wife of Armando Yzaguirre, submitted to the Department a completed Florida Fuel Tax Application, Form DR-156, seeking licensure as a private carrier and wholesaler on behalf of My Oil Company, Inc. ("My Oil"). The application listed Mrs. Yzaguirre as the president and sole stockholder of My Oil. On June 29, 2001, Mrs. Yzaguirre filed with the Department articles of incorporation for My Oil. On July 5, 2001, Mrs. Yzaguirre filed these articles of incorporation with the Secretary of State to obtain registration as a Florida domiciled corporation. Aaron Hood, a revenue specialist in the Department's motor fuel registration unit, was assigned to process both the Yzaguirre Oil application and the My Oil application. Mr. Hood conducted a standard background investigation of both applicants, securing investigative reports from the Federal Bureau of Investigation and the Florida Department of Law Enforcement on the criminal histories of Armando and Maria Yzaguirre. The reports revealed that Maria Yzaguirre had no criminal record, either of arrest or conviction. The reports revealed a lengthy list of arrests for Armando Yzaguirre. The reports included a 1980 arrest for felony arson of a structure in Collier County, and a 1990 arrest and conviction for marijuana possession in Texas. The reports were inconclusive as to whether the Collier County felony charge resulted in conviction, or whether the Texas conviction was a felony. Having difficulty determining the precise nature of the felony to which Mr. Yzaguirre admitted in his application, Mr. Hood enlisted the aid of Pete Welch, a Department investigator. On January 3, 2002, Mr. Welch reported to Mr. Hood that information received from the Clerk of the Circuit Court of Collier County confirmed that Mr. Yzaguirre had been convicted by a jury of the 1980 felony charge. However, aside from Mr. Welch's e-mail report to Mr. Hood, the Department offered no evidence confirming this felony conviction. Mr. Welch's investigation also obtained details of the Texas marijuana possession charge. In December 1990, Mr. Yzaguirre's plea of nolo contendere to a second-degree felony charge of possession of more than five but not more than 50 pounds of marijuana was accepted by the court. Mr. Yzaguirre's ten-year sentence was suspended in favor of eight years' probation and a $5,000 fine. No evidence was presented to show that Mr. Yzaguirre failed to comply with the terms of probation. Neither was evidence presented that Mr. Yzaguirre has been pardoned or that his civil rights have been restored. At the hearing, Mr. Yzaguirre indicated that he is taking steps to seek restoration of his civil rights. In his review of the Yzaguirre Oil and My Oil applications, Mr. Hood discovered that the companies claimed many of the same assets. Each company listed the same two tanker trucks to be used in transporting fuel. Each company listed 211 New Market Road, East, in Immolakee as its principal business address. Each company claimed exactly $1 million in accounts receivable. The timing of the filings and the common assets led Mr. Hood to suspect that the later My Oil application was submitted under Maria Yzaguirre's name to evade the possible disqualification of the Yzaguirre Oil application because of Mr. Yzaguirre's felony convictions. In short, Mr. Hood suspected that My Oil was a "front" corporation over which Mr. Yzaguirre would exercise control. The common assets also led Mr. Hood to suspect the truthfulness and accuracy of the financial affidavits filed by Maria Yzaguirre on behalf of My Oil. While it investigated the criminal history of Mr. Yzaguirre, the Department also investigated the extent of Mr. Yzaguirre's possible control over My Oil's business activities. Armando B. Yzaguirre is the 25-year-old son of Armando Yzaguirre and the stepson of Maria Yzaguirre. Testimony at the hearing established that Armando B. Yzaguirre completed both license applications and was the driving force behind the creation of both Yzaguirre Oil and My Oil. The elder Armando Yzaguirre's chief business is farming. His tomato and melon operation earns over $1 million per year. To save money on transporting the large amounts of fuel needed for his farming operations, Mr. Yzaguirre purchased two sizable tanker trucks in 2001, a new Peterbilt with a capacity of 9,200 gallons, and a 1998 Ford with a 2,500 gallon capacity. If these trucks were used only for Mr. Yzaguirre's farm, they would sit idle much of the time. This idle capacity gave Armando B. Yzaguirre the idea of going into the fuel transport business, using his father's tankers to deliver fuel to other farms and businesses in the area. Yzaguirre Oil was incorporated to operate as a fuel transport business. The business would be operated entirely by Armando B. Yzaguirre, who was the only member of the family licensed to drive the large tanker truck. The trucks were owned by and licensed to Yzaguirre Oil. Armando B. Yzaguirre was going through a divorce at the time Yzaguirre Oil was established. He was concerned that his wife would have a claim to half of any business he owned, and wished to ensure that ownership of Yzaguirre Oil would remain in his family. Thus, Armando B. Yzaguirre placed all ownership of Yzaguirre Oil in the name of his father, though his father would have no connection with the operation of the company's business. Subsequent to incorporating Yzaguirre Oil, Armando B. Yzaguirre discussed his prospective business with his stepmother, Maria Yzaguirre. Mrs. Yzaguirre was pleased that young Armando was establishing a business for himself. They discussed the future of the six younger Yzaguirre children and ideas for businesses that could be established to eventually be taken over by the children. Ultimately, the younger Armando and Maria Yzaguirre settled on the idea of a convenience store and filling station that could be established on part of a city block in Immolakee that the senior Mr. Yzaguirre already owned. This would be the type of business that the children could learn and work at while they were still in school, then take over after their graduation. This was the genesis of My Oil. Mrs. Yzaguirre contacted a lawyer to draft articles of incorporation and later transferred $100,000 from her personal money market account into a My Oil bank account to provide start-up money. The younger Armando Yzaguirre filled out the fuel license application, using his earlier application for Yzaguirre Oil as a model. As with the earlier application, the younger Armando Yzaguirre kept his name off the corporate documents and the fuel license application to avoid any claim by his soon-to- be ex-wife to the company's assets. He anticipated that My Oil would lease the two tanker trucks from Yzaguirre Oil, and thus listed them on the application as assets of My Oil. At the hearing, Mr. Yzaguirre conceded that he made mistakes on both applications. As noted above, he listed $1 million in accounts receivable for each of the companies. These were actually accounts receivable for his father’s farming operation, and should not have been included as assets for either Yzaguirre Oil or My Oil. Testimony from witnesses for both parties indicated that communications between the Yzaguirres and the Department were poor during the application review process. The Yzaguirres often telephoned Mr. Hood to learn the status of their applications, so often that Mr. Hood felt harassed. From their standpoint, the Yzaguirres could not understand why the applications were taking months to process, and felt that Mr. Hood was continually placing obstacles in their path and avoiding their queries. As noted above, early in the review process, the Department began to suspect that My Oil was a front for Yzaguirre Oil. At the hearing, however, the Department was unable to establish that the Yzaguirres knew of the likely rejection of the Yzaguirre Oil application in the month before they filed the My Oil application. Due to illness, Mr. Hood was unable to testify at the hearing as to his conversations with the Yzaguirres. For their part, the Yzaguirres adamantly denied any prior knowledge that the elder Mr. Yzaguirre’s criminal record would disqualify his application. Armando B. Yzaguirre, who was the Yzaguirres' point person in dealing with the Department, testified that no one at the Department made him aware that his father's criminal history was a problem until December 2001. The Yzaguirres also denied that the elder Mr. Yzaguirre would have any connection with the operation of My Oil. The Department pointed to several alleged discrepancies in the My Oil application as grounds for its suspicion that the company was a "front" for Yzaguirre Oil. First, the My Oil application, filed June 20, 2001, lists a corporate asset of $100,000 in cash on deposit at an unnamed bank, when in fact the cash was not deposited in a My Oil account at Florida Community Bank until September 10, 2001. Second, the My Oil application lists the two tanker trucks as corporate assets as of the date of application, when in fact the trucks were titled in the name of Yzaguirre Oil and the anticipated lease arrangement had yet to be consummated. Third, the My Oil application claimed the property at 211 New Market Road, East, as a corporate asset as of the date of application, when in fact the property was titled in the name of the elder Mr. Yzaguirre. Fourth, the My Oil application listed $1 million in accounts receivable as a corporate asset. As noted above, Armando B. Yzaguirre admitted at the hearing that these receivables were from his father's farming operation and should not have been listed on the application as assets of My Oil. Armando B. Yzaguirre plausibly explained that My Oil anticipated leasing the trucks, but that there was no reason to spend the money to finalize that arrangement until the fuel license was obtained and My Oil could actually commence operations. Similarly, Mrs. Yzaguirre clearly had on hand the $100,000 in cash claimed as a My Oil asset, and the timing of her actual transfer of that money into a My Oil account would not alone constitute cause for suspicion, given that My Oil had yet to commence operations when the application was filed. Armando B. Yzaguirre also convincingly explained that leasing the tanker trucks from his father's company would not give Yzaguirre Oil effective control over My Oil's business. The younger Mr. Yzaguirre contemplated that the lease agreement would be an arms-length arrangement between the two companies. If the companies could not arrive at a mutually satisfactory lease agreement, or if the lease agreement should later fall through, My Oil could lease trucks from another company and continue doing business. However, no witness for My Oil offered a satisfactory explanation as to how the elder Mr. Yzaguirre's ownership of the real property would not give him some degree of control over My Oil's business. At the time of the hearing, title to the property at 211 New Market Road, East, was in the name of Armando Yzaguirre. A warranty deed for at least a portion of the property, executed by the prior owners on July 16, 1998, was in the name of Armando Yzaguirre. The Yzaguirres did not explain whether My Oil would purchase or lease the property from the elder Mr. Yzaguirre. The structure of the arrangement is critical to the issue of the elder Mr. Yzaguirre's control over My Oil. Substitutes for the tanker trucks could be obtained in short order with little or no disruption of My Oil's business. However, the physical location of the convenience store and filling station could not be changed so readily, and the elder Mr. Yzaguirre's position as owner of that property could give him great leverage over the operation of the business. The Department also raised the issue of the undisclosed participation of Armando B. Yzaguirre in the business affairs of My Oil. The testimony of Maria Yzaguirre and of her stepson strongly indicated that the younger Mr. Yzaguirre would have substantial control over the business activities of My Oil. However, because Armando B. Yzaguirre's identity was not disclosed on My Oil's application, the Department had no opportunity to conduct a review of his background and character to determine whether he met the standard set by Section 206.026, Florida Statutes. In summary, there was no direct evidence that the Yzaguirres deliberately attempted to deceive the Department or that My Oil was established as a front to obtain licensure for the presumptively ineligible Yzaguirre Oil. The evidence did establish that Armando Yzaguirre has been convicted of at least one felony, and that his ownership of the real property on which My Oil would conduct business could provide him with control of My Oil's business activities. The evidence further established that Armando B. Yzaguirre will have control over My Oil's business, and that the Department should have had the opportunity to conduct a background review to determine his fitness under Section 206.026, Florida Statutes. In conclusion, the facts established at the hearing support the Department's denial of My Oil's application as filed, but also establish that such denial should be without prejudice to My Oil's ability to file a subsequent application curing the defects of its initial application.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order denying the application of My Oil Company, Inc. for a Florida fuel license, without prejudice to the ability of My Oil Company, Inc., to file a new application curing the defects addressed in this Recommended Order. DONE AND ENTERED this 3rd day of July, 2002, in Tallahassee, Leon County, Florida. LAWRENCE P. STEVENSON 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 3rd day of July, 2002. COPIES FURNISHED: E. Raymond Shope, II, Esquire 1404 Goodlette Road, North Naples, Florida 34102 Robert F. Langford, Jr., Esquire Office of the Attorney General The Capitol-Tax Section Tallahassee, Florida 32399-1050 Bruce Hoffmann, General Counsel Department of Revenue 204 Carlton Building Tallahassee, Florida 32399-0100 James Zingale, Executive Director Department of Revenue 104 Carlton Building Tallahassee, Florida 32399-0100
The Issue The issue presented for decision herein is whether or not Petitioner's Antiknock (octane) Index number of its petroleum product was below the Index number displayed on its dispensing pumps.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received, and the entire record compile herein, I make the following relevant factual finding. Rafael Ruiz is the owner/operator of Coral Way Mobil, an automobile gasoline station, situated at 3201 Coral Way in Coral Gables, Florida. Ruiz has operated that station in excess of ten (10) years. On or about May 13, 1987, Respondent, Department of Agriculture and Consumer Services, received a customer complaint alleging that the fuel obtained from Petitioner's station made her automobile engine ping. Respondent dispatched one of its petroleum inspectors to Petitioner's station at 3201 Coral Way on May 14, and obtained a sample of Respondent's unleaded gasoline. Inspector Bill Munoz obtained the sample and an analysis of the sample revealed that the produce had an octane rating of 86.9 octane, whereas the octane rating posted on the dispenser indicated that the octane rating of the product was 89 octane. On that date, May 14, 1987, Respondent issued a "stop sale notice" for all of the unleaded product which was determined to be 213 gallons. Petitioner was advised by Inspector Munoz that the unleaded produce should be held until he received further instructions from the Respondent respecting any proposed penalty. On May 15, 1987, Petitioner was advised by John Whittier, Chief, Bureau of Petroleum Inspection, Florida Department of Agriculture and Consumer Services, that the Antiknock Index number of the sampled product was 2.1 percent below the octane rating displayed on the dispenser and that an administrative fine would be levied in the amount of $200 based on the number of gallons multiplied times by the price at which the product was being sold, i.e., 213 gallons times 93.9 cents per gallon. Petitioner did not dispute Respondent's analysis of the product sample, but instead reported that he had been advised that three of the five tanks at his station were leaking and that this is the first incident that he was aware of wherein the product tested below the octane rating displayed on the dispenser.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is hereby RECOMMENDED: That the Respondent, Department of Agriculture and Consumer Services, enter a Final Order imposing an administrative fine in the amount of $200 payable by Petitioner to Respondent within thirty (30) days after entry of the Respondent's Final Order entered herein. RECOMMENDED this 7th day of October, 1987, in Tallahassee, Leon County, Florida. JAMES E. BRADWELL 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 7th day of October, 1987. COPIES FURNISHED: Rafael E. Ruiz c/o Coral Way Mobil 3201 Coral Way Miami, Florida 33145 Clinton H. Coulter, Jr., Esquire Senior Attorney Office of General Counsel Department of Agriculture and Consumer Services Room 514, Mayo Building Tallahassee, Florida 32399-0800 Honorable Doyle Conner Commissioner of Agriculture The Capitol Tallahassee, Florida 32399-0810 Robert Chastain, Esquire General Counsel Department of Agriculture, and Consumer Services Room 513, Mayo Building Tallahassee, Florida 2399-0800
Findings Of Fact On September 24, 1982, Respondents, James A. Joss, Steven M. Mishkin and Norma Trento, together with Thomas Moskowitz, formed Highland Ranch Acres, Inc. (Highland Ranch), a Florida corporation, for the purpose of acquiring, subdividing and selling certain land in Section 35, Township 24 South, Range 25 East Lake County, Florida. These individuals were the sole principals and stockholders of Highland Ranch, and held, respectively, one-sixth, one-sixth, one-third and one-third of Highland Ranch's capital stock. All of the above- referenced individuals made an initial capital contribution to Highland Ranch, except Joss, who donated his time, knowledge and expertise in land sales. The land in question, acquired from W. D. Land Company consisted of approximately 50 acres, which Highland Ranch "subdivided" into 40 parcels of 1- 1/4 acres each, and consecutively numbered 65 through 104. Highland Ranch marketed the parcels to residents and nonresidents of the State of Florida by telephone solicitation, and a follow-up brochure. On March 3, 1983, the same principals formed Citrus Grove Acres, Inc. (Citrus Grove), a Florida corporation, for the same purposes they had formed Highland Ranch. Their respective ownership of the capital stock of Citrus Grove was the same as it had been in Highland Ranch. Citrus Grove acquired approximately 53 acres of land from W. D. Land Company in the same section, township and range of Lake County, Florida, as those lands acquired by Highland Ranch. Citrus Grove "subdivided" these lands into 42 parcels of 1-1/4 acres each, and consecutively numbered them 105 through 146, and marketed them in the same manner the lands owned by Highland Ranch had been sold. On June 13, 1983, the same principals formed Central Florida Highlands, Inc. (Central Florida), a Florida corporation, for the same purposes they had formed Highland Ranch and Citrus Grove. Their respective ownership of the capital stock of Central Florida was the same as it had been in Highland Ranch and Citrus Grove. Central Florida acquired approximately 15 acres of land from W. D. Land Company in the same section, township and range of Lake County, Florida, as those lands acquired by Highland Ranch and Citrus Grove. Central Florida subdivided these lands into 12 parcels of 1-1/4 acres each, and consecutively numbered them 147 through 158, and marketed them in the same manner the lands owned by Highland Ranch and Citrus Grove had been sold. Highland Ranch, Citrus Grove and Central Florida had the same principals, who performed the same basic duties. Joss, assisted by Mishkin, was responsible for the conception and operation of the business of the three corporations. Joss, as president, executed the purchase and sale agreements on behalf of Highland Ranch; Mishkin, as president, executed the purchase and sales agreements on behalf of Central Florida; and Trento, as president, executed the purchase and sales agreements on behalf of Citrus Grove. The purchase and sale agreements, and the brochures mailed to the telephone prospects, except for the corporate name, were identical in each instance. The photographs in the brochures which purported to depict the lands being offered, were identical. None of the photographs depicted the subject lands but rather were of lands Respondent Joss had marketed 15 years previously through Groveland Ranch Acres, Inc. All of the lands in question were purchased from the same seller, were located in the same section, township and range of Lake County, Florida, were subdivided into 1-1/4 acre lots which were consecutively numbered 65 through 158. The lands were located in the Green Swamp Area of Critical State Concern, were zoned agricultural and required a minimum of five acres to be eligible for a building permit, were not platted with the county, and contained no avenues of ingress and egress. Respondents were advised by their attorney, Michael J. Moskowitz, that Chapter 498, Fla. Stat., required registration if they proposed to offer more than 50 parcels to more than 45 persons. He further advised them that if the subsequent corporation(s) had the same principals and other indicia of a common promotional plan that their activities might be deemed a common promotional plan, subjecting them to potential liabilities. Respondent Joss concedes that the sole reason for forming Citrus Grove and Central Florida, and taking title in their names, instead of simply purchasing the additional lands in the name of Highland Ranch, the existing corporation, was to avoid the registration requirements of Chapter 498, Fla. Stat. Highland Ranch, Citrus Grove, and Centra1 Florida did not individually convey more than 50 parcels to more than 45 purchasers. Collectively however, they did convey more than 50 parcels to more than 45 purchasers.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes (Department), enter a Final Order finding Respondents, James A. Joss, Norma Trento, Steve Mishkin, Citrus Grove Acres, Inc., and Highland Ranch Acres, Inc., guilty of violating the provisions of Sections 498.023(1) and (2), Fla. Stat., and ordering that Respondents shall not offer or dispose of, or participate in the offer or disposition of any interest in "subdivided lands," as defined by Section 498.005(17), Fla. Stat., unless the subdivided lands are registered with the Department. Within thirty (30) days of the date of the Final Order, Respondents shall offer all purchasers of land from Highland Ranch Acres, Inc., Citrus Grove Acres, Inc., and Central Florida Highlands, Inc., an opportunity to rescind their agreement, and to receive a refund of all principal and interest paid. The term "purchaser" as used herein shall mean any person who made any payment to Respondents for lands offered by Highland Ranch Acres, Inc., Citrus Grove Acres, Inc., and Central Florida Highlands, Inc., whether or not such person is currently making payments. The refund offer shall be in writing, and in a form approved by the Department. After notifying purchasers of the refund offer, Respondents shall determine the total amount of refund liability, based upon purchaser(s) who elect to rescind their agreement, and notify the Department within sixty (60) days of the date of the Final Order of the name(s) of the purchaser(s) electing to rescind their agreement and the amount of refund liability for each such purchaser. Respondents shall establish a trust or escrow account in a financial institution located within the State of Florida to assure the payment of refunds to those purchasers who elect to rescind, and to assure the conveyance of clear and marketable title to those purchasers who do not elect to rescind, transactions. Respondents shall appoint a trustee or escrow agent acceptable to the Department, who shall have such powers as are necessary to fulfill the purpose of his trust. Respondents shall collect and deposit any and all monies paid by all purchasers of lands from Highland Ranch Acres, Inc., Citrus Grove Acres, Inc., and Central Florida Highland, Inc., into the trust or escrow account established pursuant to paragraph (4). Respondents shall have no right, title or interest in or to the aforesaid monies until such time as those purchasers who have elected to rescind have been paid in full, clear and marketable title has been conveyed to those purchasers who have elected not to rescind, the trustee's or escrow agent's fees, if any, have been paid, and the civil penalties hereinafter imposed have been paid. Respondents shall pay the following civil penalties to the Department, within thirty (30) days from the date of the Final Order: Norma Trento $10,000.00 Steve Mishkin $20,000.00 James Joss $20,000.00 Highland Ranch Acres, Inc. $20,000.00 Citrus Grove Acres, Inc. $20,000 00 DONE and ENTERED this 30th day of May, 1985, at Tallahassee, Florida. WILLIAM J. KENDRICK 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 30th day of May, 1985. COPIES FURNISHED: Thomas A. Klein, Esquire Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Scott T. Eber, Esquire 3550 Biscayne Boulevard Suite 504 Miami, Florida 33137 E. James Kearney, Director Division of Florida Land Sales, Condominiums and Mobile Homes Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Richard B. Burroughs, Jr., Secretary Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301
