The Issue The issues presented are whether Respondents are guilty of the allegations contained within the Amended Administrative Complaint filed against them, and, if so, what disciplinary action should be taken against them, if any.
Findings Of Fact At all times material hereto, Respondent Emilio Faroy has been a licensed real estate broker in the State of Florida, having been issued License No. 0332008. At all times material hereto, Respondent Adriana Creel has been a licensed real estate salesperson in the State of Florida, having been issued License No. 033464. Creel has been employed as a licensed real estate salesperson with Faroy Realty since April 1, 1985. At all times material hereto, Respondent Faroy Realty Company has been a corporation registered as a real estate broker in the State of Florida, having been issued License No. 0236806. At all times material hereto, Respondent Faroy was licensed and operating as the qualifying broker and the sole officer and director of Respondent Faroy Realty Company. The real estate licenses of the Respondents are presently suspended pursuant to an emergency suspension order issued by the Secretary of the Department of Professional Regulation on July 25, 1990, because of their activities at the Dunes Beach Club. Respondent Faroy and Respondent Creel live in a unit owned by Creel at the Dunes Beach Club. Faroy Realty is registered at that same address. The Dunes Beach Club is a former motel on Miami Beach which was purchased by a developer. The units were sold to individual owners, many of whom make their units available for rental to transients and tourists. Although the Dunes Beach Club is not a condominium, there is a Homeowners' Association. The developer retained ownership of certain commercial space within the Dunes Beach Club and leased the "front desk" to a realtor who managed rentals and sales of the individual units. The Homeowners' Association became dissatisfied with that realtor and bought the lease for the front desk. At the May 19, 1986, Board of Directors meeting, the Dunes Beach Club Homeowners' Association decided that it was in the Association's best interest to hire someone to both run the operation of the front desk and manage the Association's affairs. Adriana Creel, a member of the Board of Directors, was hired for that position. Her agreement with the Board was that she would be paid $30,000.00 as a salary, that she would be given the front desk office to use at no charge, add that the Association would receive 1% of the sales price as a commission for any sales or resales of units produced through her office. No evidence was offered to show that Creel sold any units through that office or paid a commission to the Homeowners' Association during the one year that that arrangement was in effect. Creel received no commissions for renting rooms during that year since she was a salaried employee of the Homeowners' Association, and renting rooms was part of her responsibilities. In April of 1987, the Homeowners' Association decided not to renew their front desk lease with the developer and told Creel to vacate the premises immediately and to cease renting rooms. She did not do so. Instead, she and Faroy negotiated a lease with the developer, the Dunes Beach Club, Inc., which lease commenced on May 1, 1987. Pursuant to the terms of the lease, Faroy Realty was given the right to use the front desk area for "real estate rental and sales" for 36 months in exchange for Faroy Realty paying the sum of $1,050.00 per month as rent for that space. A few months later, the business address for Faroy Realty was changed to the address of the Dunes Beach Club. From that point forward until the date of the emergency suspension order entered against Respondents herein, Creel ran the front desk operation through Faroy Realty. She and Faroy set up an operating account in the name of Faroy Realty for the Dunes Beach Club operation. She arranged rentals for approximately 60 of the units at the Dunes Beach Club, collecting the rental money and depositing it Into the Faroy Realty account. She paid expenses from that account and remitted to the owners of the units the rental monies minus expenses. Although the Homeowners' Association, when it was running the front desk, had written agreements with some of the unit owners for the rental of their units, when Faroy Realty took over that operation it obtained no written agreements from any of the unit owners on whose behalf Faroy and Creel acted. In November of 1989, Creel wrote six checks to Irene Avellino for the proceeds of rentals covering May through September for units 210 and 268. At the time that those checks were written, Faroy Realty did not have sufficient funds in its checking account to cover those checks. In November of 1989, Creel wrote two checks to Samco c/o Stan Paul, representing rental proceeds for May and June for units 124, 128, and 132. At the time that those checks were written, Faroy Realty did not have sufficient funds in its checking account to cover those checks. Respondent Creel also wrote two checks to Andrew Mecca representing rental proceeds for unit 102 at the Dunes Beach Club. At the time that those checks were written, Faroy Realty did not have sufficient funds in its checking account to cover those checks. Pursuant to complaints received by Petitioner, Petitioner initiated an investigation of Respondents on November 9, 1989. The Department's investigator met with Faroy and Creel a number of times. Creel told the investigator that she had made restitution for the worthless checks she had written on the Faroy Realty account. When the investigator contacted Avellino, Paul, and Mecca in mid-December, they advised him that restitution had not been made. Faroy Realty also had an escrow account. Faroy told the investigator that although monthly reconciliation statements had been made on Faroy Realty's escrow account, none of them could be located. A subpoena was issued to Faroy Realty and Emilio Faroy on February 9, 1990, for all escrow and operating account monthly bank statements, cancelled checks, all purchase/sale contracts and leases including addenda for the period January 1987 through present, all employment agreements, and bank deposit slips. Very few records were produced pursuant to that subpoena. The few bank statements which were produced indicated that the Faroy Realty escrow account experienced overdrafts in the early part of 1989. An examination of the Faroy Realty escrow account further revealed that between March of 1987 and October of 1989, Creel wrote checks from the Faroy Realty escrow account for such personal expenses as insurance on automobiles, payments on automobiles, repairs on fax machines, dinners, health insurance, and pet supplies. She had even written checks from the escrow account to Faroy Realty with the notation that the money represented a loan. In defense of her using escrow monies for personal expenses, Creel testified at the final hearing that those checks represented earned commissions. That being the case, then the escrow account contained personal monies intermingled with trust monies. In defense of Respondent Creel writing checks on the Faroy Realty operating account when there were not monies in the account to cover those checks, Creel testified that she would write postdated checks to the unit owners commensurate with the date that she had calculated there would be sufficient monies in the account to cover those checks. Whatever her reason for doing so, the fact remains that Creel wrote checks from an account which did not have monies in the account to cover those checks. Creel's explanation for the worthless checks written in November revolved around a German tour group which, according to Respondents' exhibit, stayed at the Dunes Beach Club in October. However, the checks written by Creel in November which "bounced," on their face, represent the proceeds from rentals well prior to October. Creel testified that Emilio Faroy knew nothing of her check-writing practices. Taken in its best light, her testimony shows that Faroy failed to exercise his supervisory responsibilities over the Faroy Realty escrow account, the Faroy Realty operating account, and Faroy Realty's licensed salesperson Creel. Creel's testimony is consistent with Faroy's statement to Petitioner's investigator that he was primarily involved with his bail bond business and Creel was running Faroy Realty. Creel testified that monthly reconciliation statements had been made regarding the Faroy Realty escrow account but that they could not be found. She further testified that no attempt was made to obtain copies from the accountant who allegedly prepared those monthly statements and that she does not know whether Faroy ever signed any of the monthly reconciliation statements alleged prepared. An accountant testified on behalf of Respondents in this proceeding that he was hired in March of 1990 to do the monthly reconciliation statements on Faroy Realty's escrow account and that he had gone back to 1986 to prepare those reconciliations. None of the statements performed by that accountant have been signed by Faroy. It is found that Respondent Faroy has failed to prepare, sign, retain, and produce for inspection the required written monthly escrow account reconciliations. Creel testified that restitution had been made for the worthless checks written to Avellino, Samco c/o Stan Paul, and Mecca. Absent from her testimony was the date on which restitution was made. Respondents did offer in evidence affidavits regarding those three unit owners, which affidavits were admitted without objection. One of the affidavits was dated August 29, 1990 and two were dated August 30, 1990, one and two days prior to the final hearing in this cause. Absent from each of the three affidavits is the date on which restitution was made. The affidavits state that two of the owners have received restitution. It is noted that the affidavit from Stan Paul does not, in fact, state that restitution was made but rather that Paul has arranged a payment plan with Creel. No proof of restitution was offered to Petitioner prior to the entry of the emergency suspension order against Respondents or prior to the filing of the Administrative Complaint or Amended Administrative Complaint in this cause. It is also noteworthy that Mecca had to file a lawsuit against Creel and Faroy Realty to secure payment of the rental proceeds for which Creel had written the worthless checks to him. Respondents' failure to produce to Petitioner bank statements, cancelled checks from the escrow account, and monthly reconciliation statements has prevented a meaningful audit from being performed on the Faroy Realty accounts. Similarly, Respondents' failure to provide to Petitioner employment agreements or management agreements has made it impossible to determine Respondents' obligation to the unit owners.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered revoking the real estate certifications, licenses, permits, and registrations of the Respondents Emilio Faroy, Adriana Creel, and Faroy Realty Company. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 19th day of October, 1990. LINDA H. RIGO 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 19th day of October, 1990. APPENDIX TO RECOMMENDED ORDER DOAH CASE NO. 90-5153 Petitioner's proposed findings of fact numbered 2-17 and 19-23 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed findings of fact numbered 1 and 18 have been rejected as not constituting findings of fact but rather as constituting conclusions of law, argument of counsel, or recitation of the testimony. Respondents' proposed findings of fact numbered 2-6, 9-12, 14, 15, 17, 21, 25, 31-33, 36, and 37 have been adopted either verbatim or in substance in this Recommended Order. Respondents' proposed findings of fact numbered 1 and 24 have been rejected as not constituting findings of fact but rather as constituting conclusions of law, argument of counsel, or recitation of the testimony. Respondents' proposed findings of fact numbered 7, 8, 16, 22, 23, 30, and 35 have been rejected as being irrelevant to the issues under consideration herein. Respondents' proposed findings of fact numbered 13, 18, 19, 26-29, 34, and 38 have been rejected as not being supported by the weight of the credible evidence in this cause. Respondents' proposed finding of fact numbered 20 has been rejected as being unnecessary to the issues in this cause. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 Harold M. Braxton, Esquire Suite 400 - One Datran Center 9100 South Dadeland Boulevard Miami, Florida 33156 Kenneth E. Easley, Esquire General Counsel Department of Professional Regulation 1940 North Monroe Street Northwood Centre Tallahassee, Florida 32399-2450 Darlene F. Keller, Division Director Division of Real Estate Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801
The Issue The central issue in this case is whether Respondent is guilty of the violations alleged in the Administrative Complaint; and, if so, what penalty should be imposed.
Findings Of Fact Based upon the testimony of the witnesses and the documentary evidence received at the hearing, I make the following findings of fact: Respondent, Naomi N. Radcliff, is licensed in Florida as a real estate broker (license No. 0369173) and has been at all times material to the Administrative Complaint. On December 2, 1987, Respondent submitted a Request for License or Change of Status form which sought to cancel the license. Thereafter, the Department reclassified Respondent as an inactive broker. In July, 1986, Randy Mangold and his wife entered into a contract to purchase real property located in Indian River Estates. Naomi Radcliff was the real estate agent who handled the transaction on behalf of the Mangolds. The Mangolds' contract provided for occupancy prior to closing with a security deposit for the rental in the amount of $1500. This amount was paid to Respondent. At closing the $1500 security deposit was to be applied to the buyers' closing costs. The Mangolds rented the home for a year and attempted to obtain financing for the purchase. When their mortgage application was denied, they elected to vacate the property. After they vacated the property, the Mangolds requested the return of the $1500 security deposit. Demands were made on Respondent who refused to return the deposit despite the fact that the Mangolds had fully paid all rents owed and had left the house in good condition. Finally, the Mangolds sued Respondent in the St. Lucie County Court and obtained a judgment for the $1500 security deposit. Respondent has not satisfied the judgment. At one point Respondent did give the Mangolds a check for $500 which was returned due to insufficient funds in the account. In December, 1986, Respondent acted as a rental agent for Walter Zielinski, an out-of-state owner. Mr. Zielinski owned two houses in Port St. Lucie, one of which was located at 941 Fenway. In early December, 1986, Respondent advised Mr. Zielinski that the tenants had left the home at 941 Fenway and that the unit was in fairly good condition. Sometime later in the month, Mr. Zielinski discovered the house was empty but that it had been damaged. There were holes in the wall in the utility room approximately two feet in diameter. The flooring in the utility room and kitchen was ripped up. There was a hole in the wall in the master bedroom. More important to Mr. Zielinski, the house was unsecured because the garage door latch was broken and the house was accessible through the garage. After discovering the unit was at risk for additional damage, Mr. Zielinski attempted to contact Respondent but numerous calls to Respondent, her place of work, and to a former employer proved to be unsuccessful. Finally, Mr. Zielinski obtained another real estate agent to represent the 941 Fenway home. The new agent, Cathy Prince, attempted to obtain from Respondent the keys, the security deposit, and the rent money belonging to Mr. Zielinski. In January, 1987, Mr. Zielinski came to Florida from Illinois to take care of the rental problems. Mr. Zielinski incurred expenses totalling $876.74 to repair the damages to 941 Fenway. Also, Mr. Zielinski wanted to collect the rents owed by Respondent for his other property and have the security deposit for the second property transferred to the new agent. Respondent issued a personal check for the security deposit which was returned for insufficient funds. A second personal check paid to Mr. Zielinski for the rent owed was accepted and cleared. According to Mr. Zielinski, Respondent did not maintain an office where he could find her during the latter part of December, 1986 through January, 1987. In March, 1987, the security deposit for Mr. Zielinski's second rental was paid to the new agent. The check was issued by Respondent's mother. Respondent never personally returned any calls to the new agent. In June, 1986, Alyssa and Jeffrey Maloy entered into a contract to purchase a house. Respondent handled the real estate transaction for the Maloys. The closing was to be December 9 or 10, 1986. Respondent held monies that were required to complete the Maloy closing. Respondent attended the closing but the check tendered to the closing agent, Chelsea Title, was drawn on an trust account which had been closed. The closing agent discovered the problem and requested sufficient funds. Respondent left the closing and returned some hours later with new checks drawn on another account. After checking with the bank, it was again discovered that the funds in the account were insufficient to cover the amount needed for closing. Finally, some days later the Respondent's brother delivered a certified check to cover the amount needed to close the Maloy transaction.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Professional Regulation, Florida Real Estate Commission enter a Final Order suspending the Respondent's real estate broker's license for a period of five years. DONE and RECOMMENDED this 12th day of July, 1988, in Tallahassee, Florida. JOYOUS D. PARRISH 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 12th day of July, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-4631 Rulings on Petitioner's proposed findings of fact: Paragraphs 1-3 are accepted. With regard to paragraph 4, with the exception of the date referenced (November, 1986) the paragraph is accepted. Paragraph 5 is rejected a hearsay evidence unsupported by direct evidence of any source. The first sentence of paragraph 6 is accepted. The second sentence calls for speculation based on facts not in the record and is, therefore, rejected. Paragraphs 7-11 are accepted. With regard to paragraph 12, the first four sentences are accepted; with regard to the balance, the Respondent's brother did deliver funds to allow the Maloy transaction to close however the source of the funds is speculation based upon hearsay unsupported by the record. COPIES FURNISHED: Steven W. Johnson, Esquire Department of Professional Regulation, Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Darlene F. Keller, Executive Director Department of Professional Regulation, Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 William O'Neil, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Naomi N. Radcliff 1420 Seaway Drive Fort Pierce, Florida 33482
The Issue Whether the Respondents' real estate licenses in Florida should be disciplined based upon the charge that the Respondents are guilty of failing to maintain the required entrance sign on or about the entrance to the principal office in violation of Subsection 475.22, Florida Statutes and Rule 21V-10.024, Florida Administrative Code and are therefore in violation of Subsection 475.25(1)(e), Florida Statutes. Whether the Respondents' real estate licenses in Florida should be disciplined based upon the charge that Respondents are guilty of failing to register a branch office in violation of Subsection 475.24, Florida Statutes, and Rule 21V-10.023, Florida Administrative Code, and therefore are in violation of Subsection 475.25(1)(e), Florida Statutes. Whether the Respondents' real estate licenses in Florida should be disciplined based upon the charge that the Respondent Max S. Long, Jr., is guilty of failing to be a signatory on all escrow accounts in violation of Rule 21V-14.010, Florida Administrative Code and therefore is in violation of Subsection 475.25(1)(e), Florida Statutes. Whether the Respondents' real estate licenses in Florida should be disciplined based upon the charge that the Respondents' are guilty of failing to maintain trust funds in the real estate brokerage escrow bank account or some other proper depository until disbursement thereof was properly authorized in violation of Subsection 475.25(1)(k), Florida Statutes. Whether the Respondents' real estate licenses in Florida should be disciplined based upon the charge that Respondents' are guilty of culpable negligence or breach of trust in any business transaction in violation of Subsection 475.25(1)(b), Florida Statutes.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Petitioner is a state licensing and regulatory agency charged with the responsibility and duty to prosecute Administrative Complaints pursuant to the laws of the State of Florida, in particular, Section 20.30, Florida Statutes, Chapters 120, 455, and 475, Florida Statutes and the rules promulgated pursuant thereto. Respondent Max S. Long, Jr. was at all times material hereto a licensed real estate broker in the State of Florida having been issued license numbers 0253744, 0253742, and 0258199 in accordance with Chapter 475, Florida Statutes. The last license issued was as a broker for Stonegate Realty, Inc., 2325 Ulmerton Road, Clearwater, Florida 34620 and Queens Harbour Realty, Inc., 711 San Pablo Road North, Jacksonville, Florida 32225. Respondent Long has been a licensed salesperson since 1974 and a licensed broker since 1978. The Respondent Stonegate Property Management Corporation was at all times material hereto a corporation registered as a real estate broker in the State of Florida having been issued license number 0240617 in accordance with Chapter 475, Florida Statutes. The last license issued was at the address of 2325 Ulmerton Road, Clearwater, Florida 34620. The Respondent Stonegate Realty, Inc. was at all times material hereto a corporation registered as a real estate broker in the State of Florida, having been issued license number 0182660 in accordance with Chapter 475, Florida Statutes. The last licensed issued was at the address of 2325 Ulmerton Road, Clearwater, Florida 24620. The Respondent Queens Harbour Realty, Inc., is now and was at all times material hereto a corporation registered as a real estate broker in the State of Florida, having been issued license number 0257554 in accordance with Chapter 475, Florida Statutes. The last license issued was at the address of 711 San Pablo Road North, Jacksonville, Florida 32225. On or about October 17, 1989, DPR investigator Marjorie G. Maye (hereinafter Maye) conducted an inspection and audit of Respondents' offices and escrow accounts in Clearwater. Maye discovered that the Respondents did not display an office entrance sign for the corporations. Since the inspection Respondents have erected the proper sign which has been displayed continuously since that date. Respondents were operating an unregistered branch office located at 13280 Broadhurst Loop S.W., Ft. Myers, Florida. Respondents did not register the office because the salesperson was an employee of the developer and sold only property at that project. Since the inspection Respondents have properly registered the branch office. At the time of the inspection and audit Respondent Long was not a signatory on Respondents' escrow accounts. Since the inspection, Respondent Long has been added as a signatory to the escrow accounts. At the time of the audit Respondents' escrow account titled Queens Harbour Realty - Escrow account number 0089798317 maintained at C & S Bank of Pinellas County on September 30, 1989, had a current liability of $54,010.66, a reconciled bank balance of $8,537.99 thus indicating a shortage of approximately $45,472.67. Ultimately, the Respondents reduced the shortage to zero and the accounts balanced. At the time of the inspection and audit, Ed Perry, CPA, was employed by Respondent Queens Harbour in the accounting department and was in charge of the Queens Harbour Realty - Escrow account which was maintained out of Clearwater, Florida. George Patterson and Ed Perry, CPAs, and other individuals were signatories on this escrow account. The escrow accounts were used for deposits on real estate sales and leases. The funds were disbursed at sale or upon termination of the lease. Some of the funds received by Respondents were not required to be held in escrow. Eventually the deposits from several projects were placed in the escrow accounts. Disbursements were made from the escrow accounts even though the funds were not required to be deposited in the escrow account. This resulted in confusion as to the exact amounts of funds required to be maintained in the escrow accounts and which funds were available for distribution. Shortages in the escrow accounts were a result of intercompany loans and disbursements, as well as, from the co-mingling of funds. These were made at the direction of George Patterson. On or about October 13, 1989, Ed Perry, CPA and George Patterson, supervisor of the accounting department, signed a $6,000.00 check from Respondents' escrow account which was used for the purchase of a vehicle for Queens Harbour Yacht and Country Club. When this error was discovered the $6,000.00 was re-deposited to the escrow account. Respondent Long, became the broker for Stonegate Realty at the request of his cousin, Fred Bullard, the President of the Bullard Group, and a majority shareholder in Queens Harbour Realty, Inc. He was not aware of and did not sign any of the checks representing the inter-company loans or for the purchase of the vehicle. He derived no benefit from these loans. Respondent Max S. Long, Jr. understood at all times material to the allegations in the Administrative Complaint that an escrow account is one used to hold funds belonging to third parties and that he, as the real estate broker, acted in a fiduciary capacity to those third parties. Respondent Long relied completely on the corporation's in-house accountants to properly prepare the accounting for the escrow funds. Since the DPR investigation, there have been no shortages in the escrow account, monthly reconciliation reports are prepared and signed by Respondent Long, and the escrow accounts are routinely reviewed by Respondent Long. Respondent Long has had no prior disciplinary proceedings before the Commission.
Recommendation Having considered the foregoing Findings of Fact and Conclusions of Law, and the evidence of the record, including the contents of the several exhibits received into evidence, it is, therefore: RECOMMENDED that the Respondents be found guilty of having violated Subsections 475.25(1)(b), (e) and (k), Florida Statutes, (1989), as charged in the Administrative Complaint. It is further RECOMMENDED that Respondents shall jointly pay a penalty of $500 and that Respondent Long's real estate licenses be suspended for a period of one year, followed by a one year period of probation upon such conditions as the Florida Real Estate Commission shall reasonably impose. DONE and ENTERED this 21st day of August, 1991, in Tallahassee, Florida. DANIEL M. KILBRIDE 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 21st day of August, 1991. APPENDIX TO RECOMMENDED ORDER The following constitutes my specific rulings, in accordance with section 120.59, Florida Statutes, on findings of fact submitted by the parties. Petitioner's proposed findings of fact. Accepted in substance: paragraphs 15, 16, 17, 18, 19, 20. 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, Respondents' proposed findings of fact. Accepted in substance: paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 10, 11, 12, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 41, 42. Rejected as irrelevant: 9, 13, 40. COPIES FURNISHED: Janine B. Myrick, Esquire Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Kelli Hanley Crabb, Esquire Post Office Box 4110 St. Petersburg, Florida 33743 Darlene F. Keller Division Director 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 Jack L. McRay General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue Whether Respondent's real estate broker's license should be disciplined for dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction contrary to Subsection 475.25(1)(b), Florida Statutes and for having failed to maintain deposits received in a trust or escrow bank account maintained by the Respondent until disbursement thereof was properly authorized contrary to Subsection 475.75(1)(k), Florida Statutes. Due to the Respondent's failure to receive the Notice of Hearing the Hearing Officer continued the date of final hearing to November 15, 1984, in Clearwater, Florida and notice was provided to the Respondent's last known official address. At the hearing, held November 15, 1984, the Department called Vivian C. Firmin, Sandy MacWatters, Angela Damalos, James Damalos, Rosie Hazealeferiou, Paul Hazealeferiou, Georgia White and Alan E. Shevy as witnesses. Petitioner's Exhibits 1 through 12 were received into evidence. The Respondent failed to appear and no witnesses were called on behalf of the Respondent nor exhibits submitted into evidence on behalf of the Respondent. Proposed findings of fact not included in this order were considered irrelevant to the issues, immaterial to the results reached or were not supported by competent and substantial evidence.
Findings Of Fact At all times pertinent to the charges, the Respondent, Mark D. Gabisch was a licensed real estate broker in the State of Florida, license number 0189069. (Petitioner's Exhibit #12). Georgia M. White, a licensed real estate salesman in the State of Florida was employed by the Respondent until September 1, 1983. On July 27, 1983, Ms. White obtained a written offer for the purchase of real property from James and Angela Damalos and Paul and Rosie Hazealeferiou as purchasers. (Petitioner's Exhibit #7). The terms of the contract called for a $500.00 earnest money deposit. On July 27, 1983, Mr. and Mrs. Damalos and Mr. and Mrs. Hazealeferiou each issued a check to the Respondent's escrow account in the amount of $250.00 for a total deposit of $500.00. (Petitioner's Exhibits #1 and 9). The $500.00 deposit was placed in the Respondent's escrow bank account (Petitioner's Exhibit #4). The contract for Sale and Purchase was presented to the sellers by Ms. White and the contract was rejected and no counter-offer was made. This information was passed on to the purchasers by Ms. White and the purchasers requested the return of their deposit. On August 11, 3.983, the Respondent issued from his escrow bank account Check No. 102 in the amount of $250.00 payable to Mr. and Mrs. Hazealeferiou. On the same day the Respondent issued from his escrow bank account Check No. 103 in the amount of $250.00 payable to Mr. and Mrs. Damalos. (Petitioner's Exhibits #2, 3, 8 and 10). Checks 102 and 103, identified in paragraph 6 above, were deposited by the purchasers, dishonored by the bank upon presentment, and returned stamped "insufficient funds." (Petitioner's Exhibits #2, 3, 5, 8 and 10). Mrs. Damalos contacted Ms. White and informed her that the escrow checks had been returned for insufficient funds. Ms. White, on her own accord, contacted Respondent and eventually the purchasers received their deposit back in cash. The Respondent, in a letter to Mr. Alan Shevy, Investigator with the Department of Professional Regulation, admitted that he had misused the escrow funds and acknowledged his guilt in the matter. (Petitioner's Exhibit #11).
Recommendation Based on the foregoing Finds of Fact and Conclusions of Law it is hereby RECOMMENDED: That the Respondent's Mark D. Gabisch, license as a real estate broker, be suspended for a period of six months and that he pay an administrative fine of $1,000.00. DONE and ORDERED this 20th day of December, 1984 in Tallahassee, Leon County, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of December, 1984. COPIES FURNISHED: Mr. Mark D. Gabisch 1443 Otten Clearwater, Florida 33515 James R. Mitchell, Esquire Department of Professional Regulation Division of Real Estate 400 West Robinson Street P.O. Box 1900 Orlando, Florida 32802 Mr. Harold Huff Executive Director Department of Professional Regulation Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Mr. Fred Roche Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
The Issue Whether or not the corporate names Dupont Realty Investment Corporation and Dupont Realty, Incorporated, are deceptively similar to each other and, if so, whether or not pertinent rules and regulations of the Department of State require the latter chartered corporation to amend its Articles of Incorporation and registration to reflect a new name.
Findings Of Fact Based upon the testimony adduced at the hearing, the documentary evidence received and the entire record compiled herein, the following relevant facts are found. Petitioner, Dupont Realty Investment Corporation, was issued charter No. 535008 on April 27, 1977. Petitioner is a for-profit corporation which has remained active since April of 1977. Respondent, Dupont Realty, Inc., was issued charter No. 680928 on August 4, 1980, and has been permitted the use of that corporate name by Respondent, Secretary of State, Division of Corporations (Secretary) based on the Secretary's reliance on Chapter 607, Florida Statutes, and Rule Chapter 10- 1, Florida Administrative Code. The Secretary takes the position that the Petitioner and Respondent, Dupont Realty, Inc., were properly granted name clearances inasmuch as there exists a major word difference within the style of their name. That is, the compound "Realty Investment" denotes something entirely different from "Realty." (Letter dated April 27, 1981, from D. W. McKinnon, Director, Division of Corporations, to Anthony R. LaRossa, Petitioner's registered agent.) Petitioner, in urging that there is no difference in the subject corporate names, also points out that it has spent substantial monies in advertising; that the subject corporations are engaged in the same business (sale of real estate); are serving the same locality and are operating in the same postal areas. Using that criteria, and the guides set forth in Chapter 607.024, Florida Statutes, and Rule Chapter 10-1.04, Florida Administrative Code, Petitioner argues that Respondent, Dupont Realty, Inc.`s name is deceptively similar to its (Petitioner's) name. Both corporations operate within Dade County and are engaged in the real estate business. Petitioner's salesmen answer their telephone in the abbreviated form "Dupont Realty." According to Charles Yaritz, a salesman, Petitioner's customers refer to it as "Dupont Realty." Petitioner claims that it has received telephonic inquiries of properties about which it has no knowledge. Salesman Yaritz admitted that its business activities are primarily that of the sale of commercial properties due to "high interest rates" which are now prevalent in the area. (Testimony of salesman Yaritz and Anthony R. LaRossa, salesman and registered agent/broker for Petitioner, respectively.) Petitioner uses advertising signs which contain the caption "For Sale Dupont Realty Investment Corporation" and a telephone number. Petitioner also uses a silk screen which is different from any advertising legend used by Respondent, Dupont Realty, Inc. (See Petitioner's Exhibits 2 and 3.) Robert Silverang, an employee of Respondent, Secretary of State, examines name requests pursuant to the authority contained in Chapter 607, Florida Statutes, and Rule Chapter 10-1, Florida Administrative Code. Messr. Silverang reiterated the Secretary's position that the word Investment is regarded as a major name change/difference, the existence of which permitted the Secretary to grant the subject corporate name clearance to Respondent, Dupont Realty, Inc. Messr. Silverang also offered the opinion that when there is a major name difference, locality is not considered as a factor in either granting or denying a name clearance. Respondent, Dupont Realty, Inc., chose the name Dupont Realty because "Dupont" is her 1/ "legal" name. Respondent is engaged almost exclusively in the sale of residential property and caters to clientele consisting of approximately 95 percent French-Canadian. In further support of its claimed "confusion," Petitioner referred to the fact that it received an order of checks intended for Respondent, Dupont Realty, Inc., and retained custody of same for approximately one (1) month prior to the hearing herein. (Petitioner's Exhibit 6.) Respondent's property listings are in areas different from the areas in which Petitioner lists and sells property. Respondent advertises on signs approximately twice the size of the signs utilized by Petitioner. Respondent, Dupont, has no phone listing in the Dade County telephone directory and has not been advised by her customers of any "confused" calls. Both firms have spent approximately the same amount of funds for advertising purposes. However, the two corporations use different medians to carry out their advertising. Thus, Petitioner caters to publications which attempt to reach the commercial client, whereas Respondent, Dupont Realty, Inc., aims at reaching French-Canadians who are primarily interested in the purchase and sale of residential properties.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the grant of the name Dupont Realty, Inc., to Respondent be UPHELD in that said name is not deceptively similar to that of Petitioner. DONE and RECOMMENDED this 20th day of October, 1981, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of October, 1981.
Recommendation The Hearing Officer having found factually that the Respondents did not violate the provisions of Chapter 475 Florida Statutes, as charged, recommends that no action be taken against the registration of any of the Respondents. DONE and ORDERED this 14th day of June, 1976. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings Room 530 Carlton Building Tallahassee, Florida 32304 COPIES FURNISHED: Richard J. R. Parkinson, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789 Spencer Fox, Esquire Suite 107, 9065 Galloway Road Miami, Florida 33176
