The Issue The issue for determination in this proceeding is whether Proposed Rules 15C-7.004(4)(a), (4)(b), and (7)(d) and Florida Administrative Code Rule 15C- 1.008 each constitute an invalid exercise of delegated legislative authority.
Findings Of Fact The Parties The Department of Highway Safety and Motor Vehicles (the "Department") is the agency responsible for promulgating and administering the rules challenged in this proceeding. The Department administers Chapter 320, Florida Statutes, 2/ which governs the operation of motor vehicle dealers and manufacturers in Florida. General Motors Corporation ("GM") is a corporation incorporated in Delaware and registered to do business in Florida. GM's corporate address and principal place of business is 3044 West Grand Boulevard, Detroit, Michigan 48202. GM is licensed by the Department, pursuant to Section 320.60, Florida Statutes, as a manufacturer of motor vehicles. GM has entered into and will enter into dealer sales and service agreements to authorize motor vehicle dealers to sell GM vehicles at locations in Florida. The Florida Automobile Dealers Association (??FADA??) and the South Florida Auto Truck Dealers Association ("SFATDA") are trade associations composed of both domestic and foreign line-make franchised motor vehicle dealers. FADA is composed of more than 800 franchised motor vehicle dealers licensed in the state. SFATDA is composed of virtually all franchised motor vehicle dealers in Palm Beach, Broward, Dade, and Monroe Counties. The Motor Vehicle Manufacturers Association of the United States, Inc. ("MVMA") is a trade association whose member companies manufacture motor vehicles produced in the United States. MVMA members include Chrysler Corporation, Ford Motor Company, GM, Honda of America MFG., Inc., Navistar International Transportation Corporation, PACCAR Inc., and Volvo North America Corporation. The principal place of business for MVMA is 7430 Second Avenue, Suite 300, Detroit, Michigan 48202. All of the members of MVVA, including Ford Motor Company ("Ford"), are licensed pursuant to Section 320.61, Florida Statutes. The Association of International Automobile Manufacturers, Inc. ("AIAM") is a trade association of manufacturers and manufacturer-authorized importers which import motor vehicles for sale in the United States. AIAM members and associates affected by the challenged rules include: American Honda Motor Company, Inc.; America Suzuki Motor Corporation; BMW of North America, Inc.; Daihatsu America, Inc.; Fiat Auto U.S.A., Inc.; Hyundai Motor America; Isuzu Motors America, Inc.; Jaguar Cars, Inc.; Mazda Motor of America, Inc., Mitsubishi Motor Sales of America, Inc.; Nissan North America, Inc.; Peugeot Motors of America, Inc.; Porsche Cars North America, Inc., Rolls-Royce Motor Cars, Inc.; Rover Group USA, Inc.; Saab Cars, USA, Inc.; Subaru of America, Inc.; Toyota Motor Sales, U.S.A., Inc.; Volkswagen of America, Inc., Volvo North America Corporation; and Yugo America, Inc. The principal place of business for AIAM is 1001 19th Street North, Suite 1002, Arlington, Virginia 22209. Each member of AIAM is either licensed as an importer, pursuant to Section 320.61, Florida Statutes, or maintains a contractual relationship with a distributor which is licensed pursuant to Section 320.61. Toyota Motor Sales, U.S.A., Inc. ("Toyota"), for example, is not licensed in the state as an importer. Toyota, however, maintains a contractual relationship with Southeast Toyota, Inc., which is licensed as a distributor for the purpose of marketing motor vehicles in Florida. Hyundai Motor America ("Hyundai") is an importer of motor vehicles. Hyundai's principal place of business is 10550 Talbert Avenue, Fountain Valley, California 92728. Members of MVMA and AIAM, as well as Ford and Hyundai, have entered into and will continue to enter into dealer sales and service agreements to authorize motor vehicle dealers to sell GM vehicles at locations in Florida. Ed Morse Chevrolet of Seminole, Inc. ("Morse") is an applicant for a license as a franchised motor vehicle dealer. The application of Morse was approved after a hearing pursuant to Section 320.642, Florida Statues. Morse's facility, however, is not yet completed and it would be adversely affected by the enforcement of Proposed Rules 15C-7.004(7)(d) and Rule 15C-1.008. The portions of the proposed and existing rules challenged in this proceeding will affect the substantial interests of the parties to this proceeding. The Challenged Rules Proposed Rule 15C-7.004 was published in the Florida Administrative Weekly, Vol. 17, NO. 16, at page 1721, on April 19, 1991 (the "Proposed Rule"). The particular portions of the Proposed Rule challenged in this proceeding are hereinafter identified by the underlining in the quoted portion of the Proposed Rule. Proposed Rule 15C-7.004(4)(a) provides: Application for Reopening or Successor Dealership, or for Relocation of Existing Dealership. If the license of an existing franchised motor vehicle dealer is revoked for any reason, or surrendered, an application for a license to permit the reopening of the same dealer or a successor dealer within twelve months of the license revocation or surrender shall not be considered the establishment of an additional dealership if one of the conditions set forth in Section 320.642(5) is met by the proposed dealer. (emphasis added) Proposed Rule 15C-7.004(4)(b) provides: Application for Reopening or Successor Dealership, or for Relocation of Existing Dealership. An application for change of address by an existing dealer under this section shall be filed on form HSMV 84712, Application For Change of Location (Address) Of Dealer In Motor Vehicles, Mobile Homes or Recreational Vehicles, which is hereby adopted by reference, provided by the Department. The dealer shall indicate which provision of Section 320.642(5) Florida Statutes, if any, it contends exempts the proposed location from consideration as an additional dealership. (emphasis added) Proposed Rule 15C-7.004(7)(d) provides: (7) Hearing and Post-Hearing Procedures. (d) If the proposed additional or relocated dealership is approved construction on the dealership shall begin within 12 months of the date of the final order. The applicant must complete construction and finalize its preliminary application for license within twenty-four months of the date of the final order. This period may be extended by the Department for good cause. (emphasis added) Florida Administrative Code Rule 15C-1.008 provides: Any person who contemplates the establishment of a motor vehicle business for the purpose of selling new motor vehicles, for which a franchise from the manufacturer, distributor or importer thereof is required, shall, in advance of acquiring building and facilities necessary for such an establishment, notify the Director of the Division of Motor Vehicles of his intention to establish such motor vehicle business. Such notice shall be in the form of a preliminary filing of his application for license and shall be accompanied by a copy of any proposed franchise agreement with, or letter of intent to grant a franchise from, the manufacturer, distributor or importer, showing the make of vehicle or vehicles included in the franchise; location of the proposed business; the name or names of any other dealer or dealers in the surrounding trade areas, community or territory who are presently franchised to sell the same make or makes of motor vehicles. Upon receipt of such notice the Director shall be authorized to proceed with making the determination required by Section 320.642, Florida Statutes, and shall cause a notice to be sent to the presently licensed franchised dealers for the same make or makes of vehicles in the territory or community in which the new dealership proposes to locate, advising such dealers of the provisions of Section 320.642, Florida Statutes, and giving them and all real parties in interest an opportunity to be heard on the matters specified in that Section. Such notice need not be given to any presently licensed notice dealer who has stated in writing that he will not protest the establishment of a new dealership which will deal in the make or makes of vehicles to be included in the proposed franchise in the territory or community in which the new dealership proposes to locate. Any such statements or letters of no protest shall have been issued not more than three months before the date of filing of the preliminary application. The Director may make such further investigation and hold such hearing as he deems necessary to determine the questions specified under Section 320.642. A determination so made by the Director shall be effective as to such license for a period of twelve (12) months from the date of the Director's Order, or date of final judicial determination in the event of an appeal, unless for good cause a different period is set by the Director in his order of determination. (emphasis added) Rulemaking authority for Proposed Rule 15C-7.004 is found in Sections 320.011 and 320.27(3), Florida Statues. The law implemented by the proposed rule is found in Sections 320.27 and 320.60-320.70. Rulemaking authority for Florida Administrative Code Rule 15C-1.008 is found in Sections 320.011, 320.27(3), and 320.69. The law implemented by the existing rule is found in Sections 320.27 and 320.642.
The Issue Whether Dadeland Dodge, Inc. (Dadeland) should be permitted to relocate a motor vehicle dealership from 8455 South Dixie Highway, Miami, Dade County, Florida, to a proposed location at 16501 South Dixie Highway, Miami, Florida.
Findings Of Fact Chrysler manufacturers Dodge automobiles and trucks which are sold by a network of motor vehicle dealerships. In Florida, such dealerships are governed by the provisions of Chapter 320, Florida Statutes. Dadeland and Spitzer are dealerships selling Dodge motor vehicles in Dade County, Florida. There are five Dodge dealers in the community or territory, all of which are within Dade County. Three of the dealers are located north of the existing Dadeland site: Maroone Dodge is near the Broward County line at a point which sells into Broward; Potamkin Dodge North is in North Miami, and Potamkin Dodge is in Hialeah. Dadeland is currently located at 8455 South Dixie Highway (U.S. 1), Miami, Florida. It seeks to relocate its place of business to 16501 South Dixie Highway, Miami. Spitzer is also located on South Dixie Highway just north of Homestead, Florida. Its current location is 17.3 miles south of the existing Dadeland dealership and 11.5 miles south of the proposed Dadeland location. The criteria applicable to this case are found in Section 320.642, Florida Statutes. Such provision requires a determination of whether there is adequate representation in the community or territory. The term "community or territory" is not defined by law. In this case, the community or territory is the area used by the manufacturer to define the dealers' trading zones. Geographically the community or territory includes all of Dade County and small portions of Broward and Monroe Counties. In determining whether Chrysler has adequate representation in the community or territory, sales data was compiled for all new motor vehicle sales registered within the geographic area defined as the community or territory. Such data was for 1994 and 1995 years with projections calculated based upon actual past performance. The automobile industry classifies motor vehicles in segments lumping cars with cars and trucks with trucks. Typically, segments are designated or defined by companies such as R.L. Polk which tracks new vehicle sales. The segments group vehicles which presumably compete against one another for buyers. Dodge does not compete in all car segments. For example, it has no vehicle which is classified as mini-subcompact. Similarly, trucks are also classified into segments. Dodge competes in five of the manufacturers' ten segments. In this case, Dodge sales in the community or territory (Comm/Terr) have been compared to Dodge sales in the nation as a whole. In order to account for the buying preferences of the community or territory, the Dodge sales for this community or territory have been adjusted to consider the segment preferences of the Dade Comm/Terr buyers. In computing these projections all sales, foreign and domestic, have been considered. Chrysler does not distinguish between imports and domestics because all vehicles within the segments compete against the Chrysler entry in the segment. While some entries may, by historical buying pattern, have proved more successful, Dodge registers sales in all segments in which it competes. In some instances Dodge has competed well. For example, Chrysler was the originator of the minivan, both domestics and import manufacturers have introduced vehicles to compete in those segments. Customers looking for a vehicle in the minivan segment are going to look for the best minivan they can find, regardless of whether an import or domestic. By comparing Dodge's sales penetration in each vehicle segment in the nation with the industry available in each segment in the community or territory, an appropriate standard is established to determine whether this area is receiving adequate representation. Measuring penetration within each segment takes into account differences in consumer preferences between the two areas without regard to brand. Utilizing this segment analysis, the reasonably expected market share for Dodge in the Comm/Terr is 5.89% of retail industry for cars and trucks. Dodge penetration in the community or territory has been below expected levels in 1994 and 1995. Dodge penetration compared with its expected share (utilizing the national average area as a standard and adjusted for local segment preferences) was between 51.35% and 59.69% effective. On the basis of the net shortfall in units, or number of vehicles which, at the minimum, would be required to be registered in order to bring the community or territory up to the expected performance, the 1994 shortfall was 1075 units, and in 1995 was 907 units. Even using a Florida sales average (as opposed to the national average) as a standard for measuring whether Dodge is receiving adequate representation in this Comm/Terr, the performance of the Dodge network in this community or territory falls short. Based upon the foregoing it is concluded that Dodge has lost sales opportunity in the community or territory and that the network of Dodge dealers within this Comm/Terr have failed to adequately represent Chrysler. The community or territory has experienced growth in population, driving age population, and households during the last ten years. This growth is expected to continue. Employment has also grown and corresponds to a predominance of census traits reflecting average household incomes of over $25,000. Presumably such households represent potential new vehicle buyers. Total industry car and truck registrations in the community or territory have grown from 108,483 in 1993 to 112,767 in 1995. Spitzer sales increased in the aftermath of Hurricane Andrew and have continued to increase. Spitzer's sales history is as follows: 369 (1991); 527 (1992); 506 (1993); 567 (1994); and 644 (1995). 24. Since 1980, the number of Dodge dealers in the community or territory has decreased by one. Thus, it is important to assure that the remaining Dodge dealerships are appropriately located to serve the car buying population of the market. The importance of the number of dealers also relates to Dodge's major competitors in Dade. Six different brands have more than five points: Ford(10); Chevrolet (7); Honda (7); Chrysler-Plymouth (6); Jeep-Eagle (6); and Toyota (6). There are five dealerships within the Comm/Terr for Lincoln-Mercury, Pontiac, Nissan, and Mazda. The current Dadeland facility is a small facility with no room to expand. Other dealerships in the area offer modern, large facilities. The current Dadeland facility has no enclosed showroom with a very small sales area. The current Dadeland facility is leased by its owner to Chrysler Realty, which in turn leases it to Dadeland. The lease on this real property expires in 1997. Chrysler Realty has no right to renew it. Despite searching for land since 1992, Chrysler Realty has not been able to locate any land within two miles of the existing Dadeland dealership upon which this dealer could relocate. Although the most preferable relocation of Dadeland would move the dealership to the west, there is no site available for use as an automobile dealership in that area either. Other competitive dealerships are located south of the existing Dadeland location along U.S. 1. If Chrysler is not able to relocate Dadeland and were to lose the point, the reduction of the dealerships by one would have an adverse impact on competition, the consumer, and on dealer sales by leaving a void in an interconnected market. Dadeland proposes to relocate from its current location at the extreme far north end of the Dadeland auto cluster, into the center of an auto cluster on U.S. 1, in the immediate vicinity of many other dealerships. The auto cluster in which Spitzer is located in Homestead contains most of the same franchises which are in the auto cluster into which Dadeland proposes to relocate. Many of the same line-make dealerships, located in both clusters, are closer to one another, or about as close, as would be Dadeland and Spitzer if the relocation is permitted. The proximity of intra-brand competition promotes same line-make competition which in turn, makes strong inter-brand competitors out of both dealers. Close proximity is, generally, a positive factor for both dealerships. The pattern of Spitzer's sales, which extend in a broad pattern, suggests that Spitzer does and will continue to, make sales in close proximity to other Dodge dealers in the Comm/Terr, especially Dadeland. Spitzer penetrates the market within two miles of its dealership at a rate of 4.9%. This level of penetration falls below the national average and indicates that there is additional sales opportunity to Spitzer within two miles of its dealership. While Spitzer maintains a higher level of penetration within a six-mile radius of its dealership, its share drops after that. Whether at the distance of the proposed Dadeland relocation or where it is now, Spitzer's sales penetration in those areas is low. The relocation of the Dadeland dealership will likely benefit consumers and the public interest. It will provide the growing population of the community or territory with a more convenient place to shop for Dodges in close proximity to the other dealerships where they shop for other brands. Because of the untapped opportunity for Dodge in the community or territory, and depending on Spitzer's response to the competition, ample opportunity exists for both dealers to increase sales by capitalizing on the available sales opportunity in the area. If the relocated Dadeland dealership performs in the future in a similar manner to the way in which it is currently performing at its current location, there should be no adverse impact on the existing dealers, including Spitzer. Dealers are accustomed to the cyclical nature of the automobile business. Sales go up and down through the cycle. Any number of factors could contribute to an individual dealer's sales going up or down. Dealers make adjustments in the operation of their businesses in order to maximize their profits. Within the industry cycle, there are also shifts in the dealers' business between new and used car sales. If new cars are not popular in a down cycle, used cars become far more popular. When buyers don't have the money to buy new vehicles, they will look at used ones. Typically, when the new car business is down, the used car business will be up and service business will be up. Consequently, a dealership's profit should not correlate solely with new car sales. All of Spitzer's estimations of lost new vehicle sales, and the lost profits resulting from those lost sales, were based upon the premise that Spitzer (and the other Dodge dealers) can compete only in the domestic industry market. The persuasive evidence presented in this cause does not support that premise. Accordingly, Spitzer's sales and economic loss estimates are rejected. The Spitzer facility is adequate to serve the Homestead area and to sell into the community or territory as a whole. Spitzer should continue to increase its sales and receive a return on its investment in the facility. Chrysler is attempting to relocate Dadeland in order to promote the existing dealer network as opposed to seeking a new point to address lost market opportunity. Chrysler Realty has executed an agreement with Dadeland which provides that Chrysler Realty will build a new facility for Dadeland on property that it has purchased. All of the costs for that facility, including the purchase price of the land and all costs incurred in the construction of the building, including surveys, impact fees, architect and engineering costs will form the basis for a monthly rental amount. Chrysler Realty's return on the total amount is fixed at eleven percent. All dealerships who rent from Chrysler Realty, including one owned by Spitzer in Ohio, pay rent in accordance with the uniform policy and computation proposed for this relocation. There is no evidence that Chrysler has denied its existing dealers opportunities for growth. There is no evidence that Chrysler coerced its existing dealers to consent to the proposed relocation. Spitzer achieved its minimum sales responsibility for 1995; therefore, there is no evidence that Spitzer is not in compliance with its dealer agreement with Chrysler.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED That a final order be entered granting Dadeland's request to relocate its dealership. DONE AND ENTERED this 8th day of April, 1997, in Tallahassee, Florida. J. D. PARRISH Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 8th day of April, 1997. APPENDIX At the conclusion of the hearing, the parties stipulated to September 30, 1996, as the deadline for filing proposed recommended orders. This date was presumably selected to secure rulings on the proposed findings of fact. While the parties later waived that opportunity and agreed to submit their proposed orders on October 2, 1996, specific rulings are included below where citation to the record was noted by the party. Where no citation was listed, the proposed finding of fact is rejected unless otherwise stated in the findings of fact above. Rulings on the proposed findings of fact submitted by Chrysler: 1. Paragraphs 1 through 3, 5, 6, 12, 13, 16, 17, 18, 23, 24, 25, 26 through 30, 31, 55, 56, 57, 63, 65, 71, 72, 74, 75, 76, 78, 79, 80, 81, 85, 86, 87, 88, 90, 91, 92, 93, 94, 97, 98, 100, 101, 102, 103, 108, 109, 110, 111, 112, 113, 117, 136, 137, 138, 139 and 140 are accepted. Paragraph 4 is rejected as argument or comment of law. Paragraphs 8 through 11 are rejected as irrelevant. Paragraphs 14 and 15 are rejected as comment of law or argument. Paragraphs 19 through 21 are rejected as unnecessary or irrelevant. Paragraph 22 is accepted with the deletion of the word "very" before "conservative" which is contrary to the weight of credible evidence or not defined adequately in the record. Paragraphs 32 through 54 are rejected as argument or comment on the evidence unnecessary to the conclusions reached. Paragraphs 58 through 62 are rejected as argument or comment on the evidence unnecessary to the conclusions reached. Paragraph 64 is rejected as unnecessary to the conclusion reached. Paragraphs 66 through 70 are rejected as comment or argument not necessary to conclusions reached. Paragraph 73 is comment on the evidence. The relocation of the dealership is justified because it can't continue where it is; and, in terms of economic and other conditions, it would be damaging to the Dodge product sales which is already inadequately represented in the Comm/Terr. Paragraph 77 is rejected as comment and unnecessary. 13 Paragraphs 82 through 84 are rejected as irrelevant or unnecessary. Paragraphs 89 is rejected as irrelevant. Paragraphs 95 and 96 are rejected as argument. Paragraph 99 is rejected as argument. Paragraphs 104 through 107 are rejected as unnecessary. Paragraphs 114 through 116 are rejected as unnecessary. Paragraph 118 is rejected as comment or speculation unnecessary to the conclusions reached herein. Paragraphs 119 through 135 are unnecessary and comment on the evidence more in the form of argument than fact. To the extent findings have been made which support Chrysler's argument, such findings are accepted. Paragraph 138 is comment and the editorial quality of its statement is rejected as argumentative. Rulings on the proposed findings of fact submitted by Spitzer: 1. Paragraphs 1 through 5, 7, 10, 13, 14, 16, 17, 18, 21, 25, 28, 29, 30, 64, 65, 66, 67, 68, 73, 75 through 80, 87, 91 are accepted. Paragraphs 6, 8, 9 and 11 are rejected as contrary to the weight of the persuasive evidence. Paragraphs 12 is rejected in that it considers only geographic proximity as an impacting factor and ignores dealer performance opportunities and the opportunity for additional sales in the Comm/Terr. Paragraph 15 is rejected as it ignores the opportunity for new sales in the Comm/Terr which should offset adverse effects, if any. With regard to paragraph 16, it is accepted that the optimal location for the relocation would be north and west of the proposed site, however, no such site is available. Therefore, references to such site are rejected as irrelevant albeit factually correct. Paragraph 18 is rejected as irrelevant; Dadeland will have to future sales at its current location. Paragraphs 19, 20, 22, 23, 24, 26 and 27 are rejected as irrelevant, contrary to the weight of persuasive evidence, or argument. With regard to paragraph 31, with the addition of "and west" such paragraph is accepted as factually accurate but ultimately irrelevant. Paragraphs 32 through 47 are rejected in their conclusions as contrary to the weight of persuasive evidence. Paragraphs 48 through 63 are rejected as argument, comment on evidence or contrary to the weight of persuasive evidence. Paragraphs 69 through 72 are rejected as contrary to the weight of the credible evidence. Paragraphs 74 through 86 are rejected as comment, argument, irrelevant or contrary to the weight of the persuasive evidence. Paragraphs 88 and 90, 92, 93, and 94 are rejected as comment, incomplete, or contrary to the weight of the evidence. COPIES FURNISHED: Dean Bunch, Esquire Sutherland, Asbill & Brennan, L.L.P. 909 East Park Avenue Tallahassee, Florida 32301 Daniel E. Myers, Esquire Walter E. Forehand, Esquire Robert A. Bass, Esquire Myers, Forehand & Fuller 402 North Office Plaza Drive Tallahassee, Florida 32301 Charles J. Brantley, Director Division of Motor Vehicles Room B439, Neil Kirkman Building Tallahassee, Florida 32399-0500 Michael J. Alderman, Esquire Division of Motor Vehicles Room A432, Neil Kirkman Building Tallahassee, Florida 32399-0500
The Issue The issue in this case is whether Petitioners' notice of intent to establish a supplemental motor vehicle dealership was effective to commence the statutory protest period, which must be completed as a necessary condition of licensure.
Findings Of Fact By letter dated September 13, 2002, Petitioner BMW of North America, LLC ("BMW NA") notified Respondent Department Of Highway Safety and Motor Vehicles (the "Department") that Petitioner Pompano Imports, Inc., d/b/a Vista Motors ("Vista"), intended to relocate its dealership, where BMW cars and light trucks were being sold and serviced, from 700 North Federal Highway in Pompano Beach ("Source Site") to 4401 West Sample Road in Coconut Creek ("Target Site").1 BMW NA and Vista took the position that, pursuant to Section 320.642(5), Florida Statutes,2 the proposed reopening of the "relocatee-dealership"3 at the Target Site should not be considered subject to competing dealers' administrative protests. Pursuant to Section 320.642(1)(d), Florida Statutes, the Department caused BMW NA's September 13, 2002, notice of relocation to be published in the September 27, 2002, edition of the Florida Administrative Weekly. On September 27, 2002, also in accordance with Section 320.642(1)(d), the Department mailed copies of BMW NA's September 13, 2002, notice of relocation to all existing BMW passenger car dealers and BMW light truck dealers in Collier, Palm Beach, Miami-Dade, and Broward Counties. Within two weeks, however, the Department mailed letters to these same dealers explaining that the proposed reopening of Vista's relocatee- dealership at the Target Site would not be a "protestable" event after all. A little more than seven months later, by letter dated May 5, 2003, BMW NA notified the Department that Vista planned to establish an additional or "supplemental" dealership for selling and servicing BMW cars and light trucks at 744 North Federal Highway in Pompano Beach (the "Supplemental Site"), a parcel which is contiguous to the Source Site where the relocatee-dealership then remained open for business, the previously announced relocation having not yet taken place. As required by statute, the Department not only caused a notice to be published in the May 16, 2003, edition of the Florida Administrative Weekly regarding this putative supplemental dealership, but also it mailed copies of BMW NA's May 5, 2003, notice to all existing BMW passenger car dealers and BMW light truck dealers in Collier, Palm Beach, Miami-Dade, and Broward Counties. No dealer timely protested Vista's intended opening of a supplemental dealership at the Supplemental Site. Generally speaking, after the Department has received notice from a licensee or applicant regarding the latter's intent either to establish an additional dealership or to relocate an existing dealership, and after such notice has been duly published in accordance with Section 320.642, Florida Statutes, the Department routinely enters a final order authorizing the issuance of a license for the proposed additional or relocated dealership upon the applicant's satisfaction of all other requirements for licensure, unless a timely protest is filed, in which case final agency action must be taken pursuant to Chapter 120.4 In this case, however, by letter dated July 10, 2003, the Department informed BMW NA and Vista of its decision that because the putative relocatee- dealership was still doing business at the Source Site, and because the Supplemental Site was immediately adjacent to the Source Site, the proposed supplemental dealership would be deemed an "expansion" of the putative relocatee-dealership, as opposed to an "additional" dealership. Based on this determination, the Department concluded in its July 10, 2003, correspondence that: (1) a license would not be issued for the expansion of Vista's dealership into the Supplemental Site; (2) the opening of the dealership that Vista proposed to establish at the Target Site, which would come into being as the putative relocatee-dealership expanded, could not be considered exempt from protest, for no "relocation" would be occurring; and (3) notice and an opportunity to protest would need to be provided with respect to the Target Site before a license for an additional dealership at that location could be issued. BMW NA and Vista each requested a hearing to challenge the Department's findings and conclusions, initiating, respectively, DOAH Case Nos. 03-2969 and 03-2970. These cases were subsequently consolidated. On September 30, 2003, before the final hearing in the consolidated proceeding, the Department, BMW NA, and Vista entered into a settlement agreement. Upon being advised of the settlement, the presiding administrative law judge (not the undersigned) closed DOAH's files in Case Nos. 03-2969 and 03-2970 and relinquished jurisdiction to the Department. Pursuant to the referenced settlement agreement, the Department, on October 7, 2003, approved Vista's application to relocate its BMW passenger car and BMW light truck dealership from the Source Site to the Target Site, as had been proposed in the September 13, 2002, notice of relocation. Vista's motor vehicle dealer license was, accordingly, modified to permit Vista to conduct dealership activities with regard to BMW passenger cars and BMW light trucks at the Target Site. This modification effectively "de-licensed" Vista as a BMW dealer at the Source Site. On October 7, 2003, Vista stopped selling and servicing BMW passenger cars and BMW light trucks at the Source Site. (Vista continued to operate a preexisting, separately licensed Volkswagen dealership at the Source Site.) On October 8, 2003, Vista started selling and servicing BMW passenger cars and BMW light trucks at the Target Site. (Vista continued to operate a preexisting, separately licensed MINI dealership at the Target Site.) Also pursuant to the settlement agreement referenced above, the Department notified BMW NA and Vista, by letter dated October 15, 2003, of the following relevant findings:5 Pursuant to Rule 15C-7.004(3)(d)2, Florida Administrative Code, the Department views [Vista's] proposed additional motor vehicle BMW dealership . . . at [the Supplemental Site] as an expansion of Vista Motors' existing licensed BMW dealership at [the Source Site.] Therefore, the [proposed project at the Supplemental Site] . . . , [being] in fact merely an expansion of Vista Motors' existing location [i.e. the Source Site], [is] not [an additional BMW dealership] subject to Section 320.642, Florida Statutes. [T]hus BMW is essentially intending to remain open at its existing . . . location [meaning, apparently, the Source Site] at the same time it is relocating to [the Target Site]. Based on the foregoing findings, the Department concluded as follows:6 [The exemption from protest afforded under Section 320.642(5), Florida Statutes, cannot apply where the putative relocatee- dealership of] Vista Motors . . . remain[s] open at the [Source Site] as a franchise BMW dealer . . . [while] at the same time [Vista] move[s] [the putative relocatee- dealership] to the [Target Site]. Therefore, Vista may not be issued a license as a franchise BMW dealer at the [Supplemental Site], until it relocates to [the Target Site] and thereafter publishes a new notification of an additional dealership for the [Supplemental Site], and those proceedings, if any, are concluded in favor of the additional dealership. (Emphasis added.) At first blush, the October 15, 2003, notice seems curiously oblivious to the fact that the Department had already approved Vista's relocation to the Target Site and modified Vista's license accordingly. Indeed, there appears to be some tension between the "facts" found in the notice and the actual facts on the ground. For example, while the notice refers to Vista's existing licensed BMW dealership at the Source Site, the undisputed fact is that Vista was not licensed to operate a BMW dealership at the Source Site as of October 7, 2003. Thus, if the Department believed, as a literal reading of the notice suggests, that Vista's intent on October 15, 2003, was to expand an existing BMW dealership at the Source Site, then it would be reasonable to wonder why the Department did not conclude that Vista was operating at the Source Site without a license. Conclusion 1 seems likewise to be at odds with what had transpired in fact. On the one hand, the Department concludes that Vista has remained open at the Source Site, which it cannot do and also claim, as it had done, the Section 320.642(5) exemption. Yet, on the other hand, the Department had, in fact, previously authorized Vista to operate a BMW dealership at the Target Site under the auspices of the very exemption that the October 15, 2003, notice concludes cannot apply because Vista is still open (according to the "findings") at the Source Site. To properly understand the October 15, 2003, notice, it is necessary to focus on the word "thereafter" in Conclusion 2(b). Clearly, the timing of the "new notification" is critical. The Department is saying that, where a dealer has previously given notice of its intent to relocate an existing dealership, taking advantage of Section 320.642(5) to exempt the reopening of such relocatee-dealership at the target site, if the dealer now wants to establish a "supplemental" dealership at the source site7 (hereafter, such a dealership will be called a "backfill dealership"8) then the relocatee-dealership must truly be relocated before effective notice of the proposed backfill dealership may be published. Under this policy,9 hereafter called the "Exempt Relocation/Backfill Policy," it is appropriate for the Department, in determining retrospectively10 whether the notice of the proposed "supplemental" dealership was effective, to look at the facts as of the date of the notice. In this case, the subject notice was given to the Department on May 5, 2003, and published in the Florida Administrative Weekly on May 16, 2003. With these points in mind, it becomes apparent that the "findings" in the October 15, 2003, notice, which seem inconsistent with the facts on the ground, actually refer to the state of affairs in May 2003. Once the findings in the October 15, 2003, notice are understood as being retrospective in nature, the notice begins to make sense. What the Department found was that Vista had not relocated its BMW dealership from the Source Site to the Target Site as of May 5, 2003, when notice of the proposed backfill dealership was furnished to the Department. As a result, because Vista had previously sought the protection of Section 320.642(5) for the reopening of its relocatee-dealership, the May 5, 2003, notice respecting the backfill dealership was premature and ineffective. To remedy the problem of premature notice, the Department would afford Vista a second chance to give effective notice in the proper sequence, after the relocation of its BMW dealership from the Source Site to the Target Site had taken place.11 It is important to note that, in the October 15, 2003, notice, the Department neither needed to make nor made a finding, one way or the other, as to whether Vista's putative relocatee-dealership has, in fact, moved from the Source Site to the Target Site.12 Thus, such a determination should not be made in and through this proceeding, but, rather, by the Department (preliminarily) either (a) at the time BMW NA gives notice to the Department, again, of the proposed backfill dealership at Supplemental Site or (b) after publication of such notice in the Florida Administrative Weekly but before a license for the proposed backfill dealership is issued or denied.13 It is also not necessary, and indeed would be inappropriate, to determine in this case what action, if any, the Department should take if it subsequently determines that Vista's putative relocatee- dealership has not in fact relocated from the Source Site to the Target Site.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order providing that Vista shall be issued a license to operate a BMW dealership at 744 North Federal Highway only if: (a) prior to the time notice is given to the Department pursuant to Section 320.642, Florida Statutes, regarding the proposed dealership, Vista has actually relocated the dealership that existed at 700 North Federal Highway to 4401 West Sample Road in Coconut Creek; any protest filed against the proposed dealership is resolved in Petitioners' favor; and (c) all other legal requirements for licensure are met. DONE AND ENTERED this 15th day of April, 2004, in Tallahassee, Leon County, Florida. S JOHN G. VAN LANINGHAM 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 15th day of April, 2004.
The Issue The issue in this case is whether Petitioners are entitled to a motor vehicle dealership that is proposed to be located in Fort Walton Beach, Florida.
Findings Of Fact The evidence showed that the dealership proposed by Petitioners would sell the same line and make of motorcycles as those sold by Respondent. The proposed dealership would also compete in the Respondent’s territory since it would be located in the same county as Respondent and would be within 20 miles of Respondent. Respondent has standing to protest the establishment of the proposed dealership. On September 18, 2007, a Notice of Hearing setting the date, time and location of final hearing was issued in this case. The Notice of Hearing was mailed to the last known, valid addresses of the Petitioners, which were also the addresses provided in Petitioners’ Notice of Publication. Neither Notice of Hearing was returned. This cause came on for hearing as noticed. After waiting more than an hour, the Petitioners failed to appear to prosecute their claim. There has been no communication from the Petitioners before, during, or since the hearing to indicate that they would not be attending the final hearing. Because of Petitioners’ failure to appear, there was no evidence to demonstrate that Petitioners are entitled to a franchise motor vehicle dealership in Fort Walton Beach, Florida. Absent such evidence, the establishment of the proposed dealership should be denied.
Recommendation Accordingly, in consideration of the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered by the Florida Department of Highway Safety and Motor Vehicles denying the establishment of Petitioners’ proposed franchise. DONE AND ENTERED this 31st day of January, 2008, in Tallahassee, Leon County, Florida. S DIANE CLEAVINGER 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 31st day of January, 2008. COPIES FURNISHED: Michael J. Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 2900 Apalachee Parkway Tallahassee, Florida 32399-0635 Carl A. Ford, Director Division of Motor Vehicles Neil Kirkman Building, Room B-439 Tallahassee, Florida 32399-0635 Judson M. Chapman, General Counsel Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 David Wray Wholesale Nation Automotive, Inc. 319 Miracle Strip Parkway Fort Walton Beach, Florida 32548 Mei Zhou SunL Group, Inc. 8551 Esters Boulevard Irvine, Texas 75063 Curtis Mitchell Coastal Powersports 12 Eglin Parkway Southeast Fort Walton Beach, Florida 32548
Conclusions This matter came before the Department for entry of a Final Order upon submission of an Order Closing File by James H. Peterson, Il, Administrative Law Judge of the Division of Administrative Hearings, pursuant to Respondent’s Notice of Withdrawal, a copy of which is attached and incorporated by reference in this order. The Department hereby adopts the Order Closing File as its Final Order in this matter. Accordingly, it is hereby ORDERED and ADJUDGED that Petitioner, First Coast CIDR LLC, be granted a license for the sale of automobiles of the line-make Dodge (DODG) at 10979 Atlantic Boulevard, Jacksonville (Duval County), Florida 32225, upon compliance with all applicable requirements of Section 320.27, Florida Statutes, and all applicable Department rules. Filed August 6, 2010 3:47 PM Division of Administrative Hearings. DONE AND ORDERED this Yin, of August 2010, in Tallahassee, Leon County, L A. FORD, LES Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building Tallahassee, Florida 32399 Florida. Filed with the Clerk of the Division of Motor Vehicles this day of August 2010. . . Vinayak, Administrator NOTICE OF APPEAL RIGHTS Judicial review of this order may be had pursuant to section 120.68, Florida Statutes, in the District Court of Appeal for the First District, State of Florida, or in any other district court of appeal of this state in an appellate district where a party resides. In order to initiate such review, one copy of the notice of appeal must be filed with the Department and the other copy of the notice of appeal, together with the filing fee, must be filed with the court within thirty days of the filing date of this order as set out above, pursuant to Rules of Appellate Procedure. CAF/vlg Copies furnished: C. Everett Boyd, Esquire Nelson Mullins Riley & Scarborough LLP 3600 Maclay Boulevard South, Suite 202 Tallahassee, Florida 32312 Dean Bunch, Esquire Nelson Mullins Riley & Scarborough LLP 3600 Maclay Boulevard South, Suite 202 Tallahassee, Florida 32312 Benjamin C. Moore, Esquire St. Denis & Davey, P. A. 1300 Riverplace Boulevard, Suite 101 Jacksonville, Florida 32207 James H. Peterson, III Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Nalini Vinayak Dealer License Administrator
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Highway Safety and Motor Vehicles enter the final order dismissing Crown's Complaint. RECOMMENDED this 18th day of December, 1996, in Tallahassee, Florida. J. LAWRENCE JOHNSTON, Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 18th day of December, 1996. COPIES FURNISHED: Loula M. Fuller, Esquire Walter E. Forehand, Esquire Myers, Forehand and Fuller 402 Office Plaza Drive Tallahassee, Florida 32301 Dean Bunch, Esquire Cabaniss and Burke, P. A. 909 East Park Avenue Tallahassee, Florida 32301 Michael J. Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 Tallahassee, Florida 32399-0500 Charles J. Brantley, Director Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room B439 Tallahassee, Florida 32399-0500 Enoch Jon Whitney General Counsel Neil Kirkman Building Tallahassee, Florida 32399-0500
The Issue The issue in these cases is whether an application for motor vehicle dealer licenses filed by SunL Group, Inc., and Auto Stop, Inc., d/b/a Motorsports Depot, should be approved.
Findings Of Fact There was no evidence presented at the hearing to establish that Scooter Depot has a franchise agreement to sell or service Chunl Motorcycle Manufacturing Co. Ltd. (CHUA) motor vehicles, a line-make to be sold by Motorsports Depot. There was no evidence presented at the hearing to establish that Scooter Depot has a franchise agreement to sell or service Shanghai Meitan Motorcycle Manufacturing Co. Ltd. (MEIT) motor vehicles, a line-make to be sold by Motorsports Depot. There was no evidence presented at the hearing that the Scooter Depot dealership is physically located so as to meet the statutory requirements for standing to protest the establishment of the new point franchise motor vehicle dealerships.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Highway Safety and Motor Vehicles enter a final order dismissing the protests filed by Mobility Tech, Inc., d/b/a Charlie's Scooter Depot, in these cases. DONE AND ENTERED this 5th day of March, 2009, in Tallahassee, Leon County, Florida. S WILLIAM F. QUATTLEBAUM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 5th day of March, 2009. COPIES FURNISHED: Michael James Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 2900 Apalachee Parkway Tallahassee, Florida 32344 Mei Zhou SunL Group, Inc. 8551 Ester Boulevard Irving, Texas 75063 Carlos Urbizu Mobility Tech, Inc., d/b/a Charlie’s Scooter Depot 5720 North Florida Avenue, Unit 2 Tampa, Florida 33604 Robert L. Sardegna Auto Shop, Inc., d/b/a Motorsports Depot 17630 US 41 North Lutz, Florida 33549 Carl A. Ford, Director Division of Motor Vehicles Highway Safety and Motor Vehicles Neil Kirkman Building, Room B-439 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500
The Issue Whether Gorilla Motor Works, LLC (Gorilla) should be permitted over Petitioner's protest to establish an additional dealership for the sale of motorcycles manufactured by Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG) at 188 North Federal Highway, Deerfield Beach, Florida 33441 (the proposed location).
Findings Of Fact Petitioner is an existing franchised dealer of ZHNG Motorcycles. Petitioner's dealership is located at 550 North Flagler Avenue, Pompano Beach, Florida. Petitioner's dealership is approximately 7.2 miles from the proposed location. Respondents offered no evidence that Petitioner has failed to adequately represent ZHNG.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Department of Highway Safety and Motor Vehicles enter a Final Order denying the request to establish a new ZHNG dealership at the proposed location. DONE AND ENTERED this 7th day of December, 2011, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 7th day of December, 2011.
The Issue The issue presented here concerns the question of whether the Respondent, State of Florida, Department of Highway Safety and Motor Vehicles, Division of Motor Vehicles, should grant the Petitioner, Ross Chevrolet, Inc. (Ross), an amendment to its motor vehicle dealer license in accordance with Section 320.642, Florida Statutes, on the basis that the Petitioners in this cause, Ross and General Motors Corporation, GMC Truck and Coach Division (GMC), in the face of the challenge to Ross's licensure offered by the Respondent, Hunt Truck Sales and Service, Inc. (Hunt), have proven that the existing GMC heavy-duty truck dealers in the territory or community are providing inadequate representation for GMC. 1/
Findings Of Fact Case History On June 4, 1980, the Petitioner GMC entered into a Heavy-Duty Truck Addendum with Petitioner Ross to amend Ross's Dealer Sales and Service Agreement to enable Ross to sell Series 80 and Series 90 model heavy-duty trucks produced by GMC. The heavy-duty truck dealership would be located at Ross's existing heavy-duty truck facility, 2530 30th Avenue North, St. Petersburg, Florida. The Respondent Hunt having learned of GMC's intentions to grant a franchise to Ross, protested Ross's licensure before the Respondent, State of Florida, Department of Highway Safety and Motor Vehicles, Division of Motor Vehicles, that protest having been made in keeping with the terms of Section 320.642, Florida Statutes. After receiving the Respondent Hunt's protest, the Division of Motor Vehicles forwarded the case to the State of Florida, Division of Administrative Hearings for a hearing pursuant to Section 120.57(1), Florida Statutes. A formal hearing was held on February 25 and 26, 1981, following the succeeding prehearing matters. Several theories were advanced prior to hearing on the subject of the ability of the Director, State of Florida, Department of Highway Safety and Motor Vehicles, to consider the issue of granting the Petitioner Ross the motor vehicle dealer's license requested of that Division and the opportunity for the Respondent Hunt to protest the grant of that license. In the logical order of the treatment of these questions, they were presented as follows: The Respondent Hunt's Motion to Dismiss this action on the theory that Ross's application for licensure from the Division was premature, in that the community or territory proposed for this licensure had not been established through the application process. The Petitioners' Motion to Dismiss or in the Alternative, Motion for Summary Recommended Order on the grounds that: The application by the Petitioner Ross was a replacement application and, therefore, not subject to protest under the terms of Section 320.642, Florida Statutes, such protest being by the Respondent Hunt. Hunt was not a dealer within the same community or territory as Ross; consequently, the Ross application was not subject of protest by Hunt, in keeping with the authority of Section 320.642, Florida Statutes. A hearing was held on these jurisdictional motions on October 10, 1980, wherein evidence was presented. The Hearing Officer issued a Recommended Order which recited the fact that Ross's application for a GMC heavy-duty truck franchise resulted from Chevrolet's discontinuation of their heavy-duty truck marketing effort. The Order held that, for the purposes of heavy-duty trucks, Pinellas and Hillsborough Counties are within the same "territory or community." The Order went on to suggest that the dealer franchise sought by Ross was a replacement, not a new dealer license thereby depriving the Respondent agency of subject matter jurisdiction within the meaning of Section 320.642, Florida Statutes, and necessarily depriving the Respondent of standing to challenge the licensure. See Southside Motor Company, etc. v. Askew, 332 So.2d 613 (Fla. 1976). On December 15, 1980, John D. Calvin, Director, Division of Motor Vehicles, issued an "Order on Jurisdiction" which rejected the Recommended Order finding that Ross is a new dealer not a replacement dealer, but accepting the Recommended Order insofar as its finding that Pinellas and Hillsborough Counties are within the same "territory or community." Calvin remanded the case to the Hearing Officer for a final hearing on the issue of adequacy of representation as set forth in Section 320.642, Florida Statutes. On January 6, 1981, this Hearing Officer accepted the case on remand from Calvin upon Calvin's conclusion that "there is subject matter jurisdiction to consider the opposition to the motor vehicle application." GMC and Ross filed a petition for review of non-final agency action, pursuant to Section 120.68(1), Florida Statutes, requesting that the Second District Court of Appeal, State of Florida, review Calvin's Order on Jurisdiction. Subsequent to the filing of the appeal, Hunt filed a Motion for Continuance with the Hearing Officer and a Motion to Stay Order on Jurisdiction directed to the Division of Motor Vehicles. The Motion for Continuance was denied by the Hearing Officer and the Motion to Stay Order on Jurisdiction was granted by Calvin on February 17, 1981. After having heard oral argument and receiving written citations of authority from the parties, the Hearing Officer, on February 23, 1981, ruled that the hearing would proceed as scheduled. On February 24, 1981, the day prior to the date set for the final hearing, Respondent Hunt filed a Motion to Confirm Stay in Case No. 81-82, Second District Court of Appeal, which was then pending upon Petitioners GMC and Ross's appeal, and a Petition for Writ of Prohibition and Show Cause Order and Motion for Emergency Stay directed to the Hearing Officer, Case No. 81-359, seeking to prevent the conducting of the final hearing herein. All relief sought by Respondent Hunt was denied by the Second District Court of Appeal on February 24, 1981, and the final hearing on the merits in this matter proceeded as scheduled February 25 and 26, 1981. This Recommended Order results from that hearing. Parties Petitioner GMC is a truck manufacturer that offers for sale light, medium and heavy-duty trucks in the United States primarily through retail outlets owned and operated by independent business entities. The model line which is the subject of this proceeding-includes only heavy-duty trucks in GMC's 80 and 90 Series. The Petitioner Ross was the holder of a heavy-duty truck addendum to sell Chevrolet trucks for General Motors Corporation. The Chevrolet heavy-duty truck line is no longer produced by that manufacturer and Ross now seeks a Florida dealer license for permission to sell GMC heavy-duty trucks at the aforementioned location in Pinellas County, Florida. The Despondent Hunt is a truck dealership, licensed by the State of Florida, to handle (NC light, medium and heavy-duty trucks, as well as White, Freightliner, Volvo, and Mercedes-Benz heavy-duty trucks. Hunt's dealership is located at 8211 Adano Drive, Tampa, Florida, within Hillsborough County. . 14. The Respondent, State of Florida, Department of Highway Safety and Motor Vehicles, Division of Motor Vehicles, is an agency of the State of Florida which has among other functions the responsibility to evaluate and issue motor vehicle dealer licenses to those applicants who intend to sell motor vehicles in the State of Florida. This responsibility is mandated by Chapter 320, Florida Statutes. As an adjunct to this process, the Respondent, Division must act in accord with the provisions of Section 320.642, Florida Statutes, which creates the opportunity for ongoing dealers in the community or territory of a proposed dealer to protest the grant of the prospective dealer's license, in keeping with prior decisions of the agency and court opinions that have spoken to the issue of the Division's function in this specified requirement. Marketing The "primary area" of responsibility as designated and defined in the GM Dealer Sales and Service Agreement related to the existing franchisee Hunt, is constituted of Pinellas, Hillsborough, and Pasco Counties, Florida. Should Ross be approved for licensure by the State of Florida it has also been offered that same "primary area" of responsibility by GM. Petitioner's Exhibit No. 10 depicts the physical location of the Hunt operation in Tampa, Florida, and of the facility of Ross in St. Petersburg, Florida. The distance between those two dealerships is approximately 27 miles and the driving time necessary to traverse that distance is approximately 45 minutes. In the "primary area" of responsibility for Hunt and prospectively for Ross, there are 8 heavy-duty truck manufacturers represented to include: GMC, Volvo, Freightliner, White, Mark, International, Ford, and Kenworth. At Present all of those manufacturers have dealerships in Hillsborough County, Florida. There are 8 GMC heavy-duty truck dealerships in the State of Florida, which is part of the Atlanta zone for GMC, which has a total of 20 heavy-duty dealerships in four states to include Florida. Three of the GMC heavy-duty truck dealerships in Florida are located on the west coast of Florida. There are 281 GMC heavy-duty dealerships nationally. As reflected in Petitioner's Exhibit No. 1, heavy-duty truck registrations for all manufacturers for Hillsborough, Pinellas and Pasco Counties for the period 1975 compared to 1979 grew by 125 percent from 605 units to 1362 units. That same exhibit indicates registrations in Pinellas County, referring to that time period 1975 through 1979, to be: 1975-78; 1976-108; 1977-113; 1978-240; 1979-275. During the period of those full reporting years reflected in Petitioner's Exhibit No. 1 in the aforementioned three-county area, that is 1975 through 1979, the number of Chevrolet heavy-duty trucks sold was 6, 19, 13, 24 and 55 respectively as opposed to 106, 74, 215, 266 and 191, respectively for GMC heavy-duty trucks in those counties. Petitioner's Exhibit No. 1 shows, when comparing GMC registrations in Pinellas County to those in Hillsborough County, that for the full year periods 1975 through 1979, Pinellas County registrations were considerably less. Pasco County registrations for GMC were even less significant when this comparison is made. Petitioner's Exhibit No. 5 entered into evidence, is a printout of retail sales made by Hunt and reports part of the calendar year 1976, all of the calendar years 1977, 1978, 1979, and part of the calendar year 1980. This information is based upon data provided by Hunt to GMC. When contrasting this exhibit with Petitioner's Exhibit No. 3, admitted into evidence, which is a summarization from R. L. Polk Company data related to truck registrations in the rePorting years 1977 through 1979, one additional sale by Hunt is reflected in Petitioner's Exhibit No. 5 as contrasted with the Petitioner's Exhibit No. 3, related to registrations. There are also some minimal differences in the registration data in Petitioner's Exhibit No. 1 compared to Petitioner's Exhibit (These differences should be evaluated in conjunction with the following paragraph.) Turning to an examination of Respondent's Exhibit No. 3, which Respondent Hunt contended represented additional sales by Hunt not reflected in Petitioner's Exhibit No. 5, it should be noted that this exhibit, Respondent's Exhibit No. 3, expands the reporting period of Petitioner's Exhibit No. 5. Taking as correct the stated purpose of Respondent's Exhibit No. 3 to be one of demonstrating additional truck sales in Pinellas County bade by Hunt which are not reflected in Petitioner's Exhibit No. 5, data provided by Hunt; those sales as shown on pages 2, 4, 5, 13, 17, 18, 26, 29 and 32 of Respondent's Exhibit No. 3, add nothing to the total in that they were made by Pinellas Truck Sales, Inc., a light and medium-duty truck franchisee for GMC, not part of the Hunt Addendum with GMC to sell heavy-duty trucks. In addition those sales reflected in pages 10 and 14 of the Respondent's Exhibit No. 3 were not made in Pinellas County. Those sales in Respondent's Exhibit No. 3 found at pages 9, 12 and 16 are excluded for reasons that they are already reflected in Petitioner's Exhibit No. 5. Those sales at pages 19 and 33 of Respondent's Exhibit No. 3, are excluded because they are intradealer sales and should not be counted in marketing analysis. Finally, that sale by Pinellas Truck, which is reflected at cage 17 of Respondent's Exhibit No. 3, is also shown in the Petitioner's Exhibit No. 5, at page 12, line 31, and should be removed from Petitioner's Exhibit No. 5 as part of the count. Likewise, that intradealer transfer or sale reflected on page 19 of Respondent's Exhibit No. 3 is reported at page 13, line 41 of Petitioner's Exhibit No. 5, and should reduce the Pinellas County sales in Petitioner's Exhibit No. 5 by one unit. In summary, of the 35 additional sales which the Respondent Hunt claims to have made in Pinellas County which are not reflected in the Petitioner's Exhibit No. 5, 16 of those sales are disallowed and Petitioner's Exhibit No. 5 is reduced by 2 units. Again, considering Petitioner's Exhibit No. 1 it indicates that at the time Chevrolet had a heavy-duty truck dealership in Pinellas County, Florida, its performance was stronger in that county than in Hillsborough County, Florida, and the same observation can be made of GMC's heavy-duty truck performance, in that their performance in Hillsborough County had been stronger than its Pinellas County performance in a circumstance wherein GMC had a heavy- duty dealership in Hillsborough County. This indicates a sales advantage for the dealerships in the counties where they are found, particularly when you consider the similarity between GMC and Chevrolet heavy-duty trucks as reflected in the initial Recommended Order in this cause dated October 24, 1980, which findings of fact related to the similarities are incorporated by reference herein. On the subject of the Pinellas County market, historically sales of Chevrolet heavy-duty trucks made by the Petitioner Ross have been more along the lines of non-fleet customers with one or two purchases as contrasted to truck sales by Hunt, which have been more in the way of fleet sales. Most of the Ross accounts are with small customers. To be successful in marketing the product in Pinellas County or elsewhere, the heavy-duty truck business requires selling outside the dealership, in that the marketing is not similar to the sales of automobiles. Customers do not come to the showroom to make the purchase, the dealer must canvass outside the dealership through dealer salesmen. Ross had five salesmen canvassing end soliciting in Pinellas County with emphasis on small fleet buyers, i.e. buyers of one to five trucks. Small customers ordinarily do not do their own maintenance, and location of a dealership for maintenance purposes is an important consideration for that purchaser. This is contrasted with larger buyers who solicit bids with less regard to dealer location and availability of service. Without easily accessible service, the small buyer suffers great business damage when his equipment is down for repair. Hunt has also actively solicited business in Pinellas County and has employed three full-time parts salesmen, and has made substantial sales on accounts receivable in Pinellas County during the year 1980. It has 168 employees, 28 of which are in parts and 19 are salesmen. Pinellas County as a "Community or Territory" In the preliminary jurisdictional decision, from the evidence presented it appears that "primary area" of responsibility as designated by GM for Hunt and Ross to sell GMC heavy-duty trucks and the "community or territory" within the meaning of Section 320.642, Florida Statutes, related to Hillsborough, Pinellas and Pasco Counties were synonymous. After reviewing the facts presented in the expanded hearing held in February, 1981, Pinellas County is found to be a separate and distinct "community or territory," and having decided that Pinellas County constitutes a "community or territory" within the meaning of Section 320.642, Florida Statutes, separate and apart from Hillsborough and Pasco Counties, the following supplemental facts are offered in support of this finding: Pinellas County's population, according to the Bureau of Census in 1970, was 522,329 and it has grown to 721,227 - a growth rate of about 38 percent. Projection by the University of Florida, Division of Population Studies, Bureau of Economic Analysis, indicate a growth rate for the next decade of around 29 percent. According to the Center for Economic Management Services, there were 224,000 persons employed in Pinellas County in August, 1980. Principal industries in Pinellas County are tourism, construction and light manufacturing. The 1977 Census of Economic Activities by the US. Bureau of the Census indicated 803 manufacturing firms in Hillsborough County as contrasted with 866 of those firms in Pinellas County. A smaller number and percentage in Pinellas County were classified by this census as being large firms with 20 or more employees.
The Issue The issue for consideration in this matter is whether Respondent, Michael L. Pappas, Jr., should be granted permission to purchase 20 percent of the stock in Plaza Dodge, Inc., and be recognized as executive management thereof, or whether the purchase should be rejected because of Mr. Pappas's prior conviction of a felony and alleged bad character.
Findings Of Fact At all times pertinent to the issues herein, Chrysler was a motor vehicle manufacturer licensed to do business in Florida; Plaza was a motor vehicle dealer licensed by the state; and Michael L. Pappas, Jr. was an individual seeking to purchase an ownership share in Plaza Dodge. He has been general manager of Plaza Dodge since January, 1993. On May 9, 1994, Plaza notified Chrysler that Mr. Pappas intended to purchase a 20 percent ownership interest in its shares and become executive manager of the dealership. The existing dealership agreement between Chrysler and Plaza reflects Mr. Pappas' father, Michael L. Pappas, is the sole owner and manager of the dealership. This agreement is not assignable without the consent of Chrysler Corporation. In his application submitted to Chrysler, Mr. Pappas indicated he had been convicted in 1987 of several felony counts dealing with his sale and possession of cocaine in 1985. As a result of that conviction, Mr. Pappas was sentenced to four years in prison, fined $50,000, and placed on five years probation. After he had been incarcerated for approximately six months, Mr. Pappas was placed in to a work release program for five months and then released to serve his five years probation. There is some indication this early release was effected because of prison crowding. The probation was terminated in July, 1991, earlier than scheduled. There is no evidence he has been pardoned. Mr. Pappas' civil rights were restored in August, 1992, through the simple process of applying for it. As was previously stated, he has been serving as general manager of Plaza since January, 1993. Since he has been serving in that capacity, Chrysler has been aware of his position and has not complained. In fact, he has, without objection, attended official functions put on by Chrysler in his capacity as the representative of Plaza Dodge. He was identified as an officer of the dealership when it applied to the state for licensure, and revealed his conviction on the licensure application. The application was approved by the Department of Highway Safety and Motor Vehicles Chrysler has rejected Mr. Pappas' application to purchase an ownership share in the dealership and his proposed executive management thereof citing as grounds for its rejection his prior felony convictions as evidence of his bad character. Chrysler contends that Mr. Pappas' conviction would adversely impact on the public confidence in the dealership and would have an adverse effect on sales. It sells and services vehicles only though its dealers and relies upon its dealerships to project its corporate image. Chrysler is also concerned that, since it accepts warranty claims at face value from its dealers, it must be able to rely on the character and integrity of those dealers to insure the warranty service was performed and the vehicles sold as claimed. No evidence exists to indicate this would not be the case here. The only evidence of the potential for problem came in the testimony of Chrysler's own official in explanation of its policy regarding dealership owners was presented and no indication of any dealership misconduct by Plaza under Mr. Pappas' stewardship was shown. Chrysler has adopted a policy prohibiting approval of anyone for ownership of a dealership who has "a prior felony conviction or other derogatory personal or character reputation or background which could be detrimental to or otherwise harm the image of Chrysler, the dealership, other Chrysler dealers of Chrysler products." Chrysler has attempted to enforce that policy uniformly and has taken the position that the conviction of a felony, by itself, will have a detrimental impact on the image of Chrysler Corporation. The evidence of record in this case does not seem to support that position, however. All during the time of his incumbency as Plaza's general manager the dealership's customer relations, as reflected by sales and service performance, has been rated as good, and those ratings have reflected an improvement over previous years. At no time has Chrysler objected to Mr. Pappas' presence at the dealership until now, and Chrysler presented no evidence of a lack of customer satisfaction with dealership performance or of its dissatisfaction with Plaza's share of the market. By the same token, the financial stability of Mr. Pappas or the dealership was not brought into issue. The evidence of record, through the testimony of others including an area Chrysler dealer, indicates that Mr. Pappas is well versed in the intricacies of operating an automobile dealership and has a good reputation for ability as well as character and integrity in the auto sales and service community. In addition to his employment in the management of a popular family restaurant Mr. Pappas has been involved in several other business partnerships and his partners speak well of his character and his business acumen. Mr. Pappas also appears to have earned the confidence of the community at large. Former law enforcement officials who were in office at the time of his arrest indicated there was no evidence of any serious misconduct on his part aside from that for which he was convicted. In the opinion of the former Tarpon Springs Police Chief, he appears to have been rehabilitated. In addition, Mr. Pappas appears to be a concerned parent and is active in community affairs. He shows remorse for his former misconduct and desires to have another opportunity to prove himself. At the time of his arrest, and during the period prior thereto, when he had been heavily into the use of cocaine, Mr. Pappas, along with his two cousins, was employed in the family restaurant in Tarpon Springs and had advanced to a position of responsibility. The three cousins were soon to assume some ownership interest in the establishment, but because of his conviction, Mr. Pappas was determined to be ineligible to be an officer in a corporation which held a liquor license. While using cocaine, Mr. Pappas periodically had it in his possession at work in the restaurant and was using it at least six days a week. He was involved at the time with a woman, Ms. Gleason, a drug and alcohol addict, to whom he supplied cocaine more than half of the times they were together. He sold cocaine to both Ms. Gleason and to others in order to support his own habit. Many of his sales were of large amounts bringing him several thousands of dollars at a time. Even after he was married in 1983, he continued to use cocaine even though he told his wife he had stopped. There is no evidence of his use or possession of cocaine any time after his release from prison, however.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is: RECOMMENDED that the Department enter a final order finding that Michael L. Pappas, Jr. is shown to be of good moral character and is qualified to be an equity owner and executive manager of Plaza Dodge, Inc. DONE and ENTERED this 16th day of April, 1996, in Tallahassee, Florida. ARNOLD H. POLLOCK, 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 16th day of April, 1996. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-3869 To comply with the requirements of Section 120.59(2), Florida Statutes (1993), the following rulings are made on the parties' proposed findings of fact: Petitioner's Proposed Findings of Fact. - 9. Accepted and, as appropriate, incorporated in this Recommended Order. 10. - 15. Accepted. 16. - 21. Accepted and incorporated herein. 22. - 26. Accepted and incorporated herein. 27. & 28. Accepted and incorporated herein. - 37. Accepted. 38. Accepted and incorporated herein. Respondent's Proposed Findings of Fact. Respondent has listed two paragraphs 5 in his Recommended Order. Therefore, all reference to Proposed Findings of Fact numbered 6 and after related to the paragraph numbered one less in the proposal. - 4. Accepted and incorporated herein. 5. & 6. Accepted and incorporated herein. 7. - 11. Accepted and incorporated herein. - 17. Accepted and incorporated herein. Accepted. Accepted. COPIES FURNISHED: Dean Bunch, Esquire Cabaniss & Burke, P.A. 909 East Park Avenue Tallahassee, Florida 32301 Edward Weeby, Esquire Senior Staff Counsel Chrysler Corporation 12000 Chrysler Drive Highland Park, Michigan 48288-0001 Daniel E. Myers, Esquire Walter E. Forehand, Esquire Myers & Forehand 402-B North Office Plaza Drive Tallahassee, Florida 32301 Marie L. Demarco, Esquire D. Scott Douglas, Esquire MacFarlane, Ausley, Ferguson and McMullen 400 Cleveland Street Clearwater, Florida 34615
