Findings Of Fact Pursuant to the Prehearing Stipulation, the following facts are established: This case is based on allegations by John Carosso that James J. Baruch, a licensed real estate broker, wrongfully allowed the dispersal of a deposit Mr. Carosso had made to Centennial Development Corporation on a villa to be constructed. James J. Baruch was associated with Wyn Pope Associates, Inc., as a realtor and salesman over a period of several years and on several projects which Mr. Pope developed. On the Gasa Tiempo project, the developer was Centennial Development Corporation and sales were handled by Wyn Pope Associates, Inc. This corporate realtor was formed using James J. Baruch's realtor's license. During their association, Wyn Pope and James Baruch had always agreed that no deposits would be accepted which could not be used for construction after the mortgage commitment. In the past Mr. Baruch had rejected contracts which did not allow such use of the deposit. The Casa Tiempo contracts all contained such a provision and deposit monies were invariably used for construction with the knowledge of the purchasers. Only the contract with John Carosso was changed to provide for an escrow and to prohibit use of the deposit for construction. Mr. Baruch did not prepare or negotiate this contract and his only connection with the Carosso sale was to witness Mr. Carosso's signature. The contract was negotiated and altered by Wyn Pope without Mr. Baruch's knowledge or consent. Neither Mr. Baruch nor Wyn Pope Associates was a party to the contract and the contract said that the deposit would be held in escrow, but did not specify an escrow agent. As a party to the contract, Centennial acknowledged receipt of the deposit and thereby agreed to hold it in escrow. Since Mr. Baruch was not an officer or in any way a part of Centennial Development Corporation, he had no authority to approve or modify the contracts and no reason to believe that he needed to review each contract himself. Mr. Baruch was therefore not authorized to control the deposit which according to the terms of the contract was made to Centennial Development Corporation. Although the contract was signed July 6, 1979, no deposit was received until July 17, 1979. The changes regarding escrow, although typed in, were each initialed, indicating that the contract was changed after execution and witnessing. Given the ten-day delay and initialing, it is likely that the changes regarding the deposit were made in the contract after Mr. Baruch had witnessed Mr. Carosso's signature and as a condition of the deposit being actually paid. In that case, Mr. Baruch would have no way of knowing that the standard contract had been modified unless he checked each contract submitted by other salesmen. Contrary to paragraph 9 of Petitioner's Complaint, Mr. Baruch never had actual knowledge of the terms of the Carosso contract until the project was taken over by Casa Tiempo Builders, Inc., in May, 1980. Mr. Baruch received no commission on the Carosso sale and never received any part of the deposit. Mr. Baruch completely severed his connection with Wyn Pope Associates, Inc., and Casa Tiempo in March, 1980, and did not profit in any way from the additional deposits demanded and received by Joseph Falso in May, 1980. On or about August 7, 1980, John Carosso entered into an agreement for the completion of his villa in which he released Centennial Development from all claims connected with his deposit. John Carosso was injured by the use of his deposit only in that he lost the option of withdrawing his deposit and rescinding the contract. He could not have finished his home at the original contract price even if the deposit remained in escrow. All the homes in the project had appreciated greatly in value between the contract of July 6, 1979 and the May, 1980 meeting, thus it was to each owner's advantage to pay the 7,500 and complete construction. Because of this appreciation, Mr. Carosso could have paid the $7,500 and immediately sold the house in May, 1980 for enough to return his entire initial deposit plus a profit. One Mr. Hmeilewski, a contract vendee, did so with the help of the new management of Centennial. Selling his contract would thus have enabled Mr. Carosso to be in a better position than rescission and return of the deposit. He preferred to have the house at the increased price. Respondent's position is that he was not responsible for the deposit and should not be sanctioned for the events stipulated to, especially since no actual damage was incurred by Mr. Carosso and all claims against the Developer and escrow holder Centennial Development Corporation were released by Mr. Carosso.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Administrative Complaint filed against James J. Baruch be dismissed. DONE and ORDERED this 24th day of August, 1982, in Tallahassee, Florida. SHARYN L. SMITH, 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 24th day of August, 1982. COPIES FURNISHED: Frederick H. Wilsen, Esquire Department of Professional Regulation State Office Building 400 West Robinson Street Orlando, Florida 32801 James H. Gillis, Esquire Staff Attorney Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Nicholas Rockwell, Esquire McCUNE HIAASEN CRUM FERRIS & GARDNER, P.A. 25 South Andrews Avenue Post Office Box 14636 Fort Lauderdale, Florida 33302 Samuel R. Shorstein, Secretary Department of Professional Regulation Old Courthouse Square Bldg. 130 North Monroe Street Tallahassee, Florida 32301 Carlos B. Stafford Executive Director Florida Real Estate Commission Post Office Box 1900 Orlando, Florida 32802
Recommendation Based on the foregoing stipulated facts and conclusions of law as found above, I recommend that the Defendant be issued a private written reprimand. DONE and ENTERED this 25th day of February, 1977, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Robert J. Randolph, Esquire Randolph & Randolph P. O. Box 1546 209 West Ocean Boulevard Stuart, Florida 33494 Frederick H. Wilsen, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789
The Issue The issue in this case is whether the allegations of the Administrative Complaints are correct and, if so, what penalty should be imposed.
Findings Of Fact R. Granger Bruner is and at all material times has been licensed as a real estate broker, Florida license number 0010871. CASE NO. 90-2462 On or about September 9, 1989, Mr. Bruner obtained a contract from Alabama resident Earl W. Reed in which Mr. Reed offered to purchase certain property from owner Gary Salter. 1/ Mr. Reed, by his check, deposited with Mr. Bruner the sum of $1,000, as an earnest money deposit in connection with Mr. Reed's offer to purchase Mr. Salter's property. Mr. Bruner erroneously deposited Mr. Reed's earnest money deposit check into the Granger Bruner Realty operating account at People's National Bank of Niceville. Mr. Bruner's escrow account, where the earnest money deposit should have been held, was at the local Barnett Bank in the name of Granger Bruner Realty Trust Account. On or about September 14, 1989, the listing agent for Mr. Salter contacted Mr. Bruner's office and informed Mr. Bruner that Mr. Salter had withdrawn the property from the market. By letter dated September 21, 1989, Mr. Bruner notified Mr. Reed that the property had been withdrawn from the market and that the earnest money deposit was being returned. Enclosed with the letter was People's National Bank of Niceville check #509 drawn on the operating account of Granger Bruner Realty in the amount of $1,000 payable to Earl Reed. The letter and check were mailed to Mr. Reed at his address in Alabama. Mr. Reed apparently did not receive the letter or check, and became concerned about the return of his deposit money. The administrative complaint alleges that Mr. Reed continued to demand return of the deposit. Although the Department introduced a copy of Mr. Reed's complaint, Mr. Reed did not testify. The evidence does not establish that Mr. Reed made repeated demands on Mr. Bruner for return of the deposit. The complaint further alleges, but the evidence does not establish, that the September 21, 1989 check was not mailed until September 28, 1989. On September 30, 1989, Mr. Reed met in Crestview with Mr. Bruner and demanded the return of his earnest money deposit. Mr. Bruner issued check #2924 in the amount of $1,000 from Mr. Bruner's wife's personal account payable to Earl Reed. Mr. Bruner subsequently had a stop-payment order issued against the first check to Mr. Reed. CASE NO. 90-2463 Prior to October 6, 1989, Elaine Brantley, an auditor/investigator for the Department contacted Mr. Bruner and made an appointment to perform a routine audit on Mr. Bruner's accounts. Prior to October 6, 1989, Mr. Bruner was aware that his escrow account was short. On that date, Mr. Bruner deposited approximately $1,400 into his escrow account to cover the shortage. The deposit resulted in an overage in the account. Upon Ms. Brantley's arrival, Mr. Bruner informed her that the escrow account was short, that he'd gotten behind in bookkeeping, and that his secretary was depositing additional funds into the escrow account. Ms. Brantley had Mr. Bruner telephone the bookkeeping department at Barnett Bank. With Mr. Bruner's approval, Ms. Brantley asked for and obtained the balance of the escrow account by telephone from a bank employee. 2/ Mr. Bruner then informed Ms. Brantley that escrow account liabilities totaled $1,727.38. Ms. Brantley reviewed the account's check ledger and determined that the escrow account was indeed short. During the audit, Ms. Brantley noted an escrow account check #453 dated 7/25/89 in the amount of $500 made payable to Mr. Bruner. Ms. Brantley stated that Mr. Bruner said that he had disbursed the funds to himself to cover a mortgage payment he made to a third party identified as Ms. Penner. At hearing, Mr. Bruner testified that he had used his escrow account to cash a $400 check for another person, and that check #453 was drafted to recover his personal funds from the account. He stated that the check was written in error and that the transaction was not handled correctly. He admitted that he did not know the balance of the escrow account at the time the check was written. The recorded checkbook balance at the time was $340.19. At the time of the audit, Ms. Brantley also noted check #487 dated 9/26/89 in the amount of $500 to Ms. Penner. The evidence establishes that check #487 was Mr. Bruner's personal mortgage payment to Ms. Penner.
Recommendation Based upon the foregoing Findings of fact and Conclusions of Law, it is RECOMMENDED: That the Department of Professional Regulation, Division of Real Estate, enter a Final Order suspending the licensure of R. Granger Bruner for a period of 90 days, and imposing a total fine of $2,000, including $1,000 pursuant to Rule 2IV-24.001(3)(1), Florida Administrative Code, and $1,000 pursuant to Rule 21V-24.001(3)(c) and (f), Florida Administrative Code. It is further recommended that R. Granger Bruner be required to successfully complete a course of education related to management of operating and escrow trust accounts and be required to file escrow account status reports with the Commission at such intervals as the Commission deems appropriate. DONE and ENTERED this 17th day of April, 1991, in Tallahassee, Florida. WILLIAM F. QUATTLEBAUM 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 17th day of April, 1991. APPENDIX TO RECOMMENDED ORDER CASE NO. 90-2462 The Petitioner did not file a proposed recommended order. The Respondent filed a "Proposed Order" which sets forth proposed findings of fact. The proposed findings are accepted as modified in the Recommended Order except as follows: "Proposed Order" Accepted as to failure to prove exact amount of escrow account shortage. Rejected as to whether a shortage existed, contrary to evidence. Rejected. The testimony at hearing that certain deposits were not received is contrary to information provided to auditor and was not credited. Although the testimony related to the escrow account balance was unsupported hearsay, the auditor's testimony related to deposits and liabilities was based upon admissions by the Respondent. See Section 90.803(18), Florida Statutes. Rejected, conclusion of law. Rejected, not supported by weight of evidence. 8-9. Rejected, unnecessary. 10. Rejected, immaterial. 11-12. Rejected, unnecessary. "Finding of Fact" The Respondent also filed a separate statement entitled "Finding of Fact" which includes additional proposed findings of fact. The proposed findings are accepted as modified in the Recommended Order. COPIES FURNISHED: James H. Gillis, Esquire Senior Attorney Department of Professional Regulation Division of Real Estate Hurston North Tower 400 W. Robinson Street P.O. Box 1900 Orlando, Florida 32802-1900 Bart O. Moore, Esquire Moore, Kessler & Moore 102 Bayshore Drive Niceville, Florida 32578 Darlene F. Keller, Director Division of Real Estate Department of Professional Regulation Division of Real Estate Hurston North Tower 400 W. Robinson Street P.O. Box 1900 Orlando, Florida 32802 Jack McRay General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue An Administrative complaint dated April 13, 1999, alleges that Respondent Mr. Stevens violated several provisions of Section 475.25, Florida Statutes, when he failed to return an earnest money deposit to a buyer after being directed to do so by the seller, the U.S. Department of Veterans Affairs. The issues in this proceeding are whether Mr. Stevens committed the violation and if so what discipline is appropriate.
Findings Of Fact Respondent, Collie E. Stevens, has been licensed in the State of Florida as a real estate broker since 1986. Prior to that year he was licensed as a real estate salesperson in Florida. In 1996 Mr. Stevens represented the seller, the U.S. Department of Veterans Affairs (VA), in the sale of a home in Orange County, Florida. On October 1, 1996, Doris Wright executed an Offer to Purchase and Contract of Sale for the home. When she signed the contract Ms. Wright gave the broker, Mr. Stevens, a check for $675.00 as an earnest money deposit. Mr. Stevens deposited the check into his escrow account. Later, in October or November 1996, Ms. Wright withdrew her offer to purchase the property. The VA regional office provided a notice to Mr. Stevens dated November 20, 1996, directing him to return the earnest money deposit to Ms. Wright. Mr. Stevens never returned the money to Ms. Wright although she made several requests through his secretary and made several attempts to contact him directly. Mr. Stevens alleges that he is entitled to retain at least $250.00 of the $675.00 deposit because that was the mortgage company's fee for processing Ms. Wright's mortgage application. Mr. Stevens claims that Ms. Wright authorized him to pay that fee on her behalf when she was not in town; Ms. Wright does not dispute that claim. Mr. Stevens also argues that he should be entitled to the remainder of the deposit money because Ms. Wright cancelled a listing agreement for him to sell her house. Ms. Wright disputes this claim and Mr. Stevens did not produce any contract or document evidencing such an agreement. During the pendancy of his dispute with Ms. Wright over entitlement to the deposit Mr. Stevens never notified the Florida Real Estate Commission of the dispute nor did he submit the matter to arbitration, mediation, or any court. Mr. Stevens insists that he could have worked out his differences with Ms. Wright and that he was always willing to give her $425.00, left after deducting $250.00 for the processing fee from the $675.00 deposit. In 1996, in another case, Mr. Stevens was disciplined by the Florida Real Estate Commission for culpable negligence or breach of trust, failure to give notice of his representation of a party, failure to maintain trust funds in an escrow account, and failure to preserve and make available brokerage records.
Recommendation Based on the foregoing, it is RECOMMENDED: That the Florida Real Estate Commission issue a final order finding that Collie E. Stevens is guilty of a violation of Sections 475.25(1)(d)1. and 475.25(1)(0), Florida Statutes, as charged in the Administrative Complaint, and that the Florida Real Estate Commission suspend his license for two years and require him to complete a 7-hour escrow management course and a 60-hour post-licensure course, and that he pay the costs associated with this case. DONE AND ENTERED this 19th day of June, 2000, in Tallahassee, Leon County, Florida. MARY CLARK 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 19th day of June, 2000. COPIES FURNISHED: Andrea D. Perkins, Esquire Department of Business and Professional Regulation 400 West Robinson Street, Suite 308N Orlando, Florida 32801-1772 Collie E. Stevens Son Set Free Realty, Inc. 2294 North U.S. One Fort Pierce, Florida 34950 Herbert S. Fecker, Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 Barbara D. Auger, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
Findings Of Fact At all times material to this case, Respondent, Antonio Prado, has been a licensed real estate broker in the State of Florida, license no. 0138312. Respondent, Antonio Prado, is the President and qualifying broker for a real estate company called Bayside International Realty, Inc. Respondent, Bayside International Realty, Inc., has been issued real estate license no. 1001760. The Department is the state agency charged with the responsibility of regulating real estate licensees. On January 13, 1995, an investigator employed by the Department conducted an office inspection and audit of the Respondents' place of business. During the course of the audit, the investigator discovered that the escrow account for the business contained $1,000.00. None of the $1,000.00 was, in fact, "trust funds" owed or belonging to a third party as Respondents have not held "trust funds" since August, 1990. The investigator advised Respondent that he was not allowed to hold personal funds in excess of $200.00 in the company escrow account. Based upon that information, Respondent immediately, on January 13, 1995, removed $800.00 from the escrow account leaving a balance of $200.00. The purpose of holding $1,000.00 in the account related to a Barnett Bank policy which required the minimum balance of $1,000.00 to avoid service charges on the account. Respondent, Antonio Prado, has not been active in the real estate practice for several years and was unaware of changes to the escrow policy dating back to December, 1991, which prohibit more than $200.00 of personal funds in an escrow account. Respondent, Antonio Prado, has been licensed for 19 years and has never been disciplined for any violations of the real estate law.
Recommendation Based on the foregoing, it is, hereby, RECOMMENDED: That the Florida Real Estate Commission enter a final order determining the Respondent, Antonio Prado, committed only a minor technical violation of Section 425.25(1)(e), Florida Statutes, and, in recognition of Respondent's exemplary record as a broker, which, along with his willing, immediate action to correct the error, demonstrates sound judgment, issue a letter of reprimand and guidance regarding escrow account rules and regulations. All other allegations against these Respondents should be dismissed. DONE AND ENTERED this 15th day of May, 1996, in Tallahassee, Leon County, Florida. JOYOUS D. PARRISH, 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 15th day of May, 1996. APPENDIX TO RECOMMENDED ORDER, CASE NO. 96-0038 Rulings on the proposed findings of fact submitted by Petitioner: None submitted. Rulings on the proposed findings of fact submitted by Respondent: Paragraphs 1 and 2 are rejected as statements of fact as they are restatement of argument or comment made at the hearing. Paragraphs 3 through 6 are accepted. COPIES FURNISHED: Henry M. Solares Division Director Division of Real Estate Department of Business and Professional Regulation Post Office Box 1900 Orlando, Florida 32802-1900 Lynda L. Goodgame General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399 Theodore R. Gay Senior Attorney Department of Business and Professional Regulation Division of Real Estate Rhode Building Phase II 401 Northwest Second Avenue N607 Miami, Florida 33128 Antonio Prado, pro se and as President of Bayside International Realty, Inc. 1390 Brickell Avenue, Suite 230 Miami, Florida 33131
The Issue The issue in this case is whether Respondent, Lee H. Davis, committed the offenses alleged in an Administrative Complaint issued against him on August 16, 1999.
Findings Of Fact Petitioner, the Department of Business and Professional Regulation, Division of Real Estate (hereinafter referred to as the "Division"), is an agency of the State of Florida. The Division is charged with the responsibility for, among other things, regulating the practice of persons holding real estate brokers' and real estate salespersons' licenses in Florida. Section 20.165, and Chapters 455 and 475, Florida Statutes. Respondent, Lee H. Davis, is and was at all times relevant to this matter licensed as a real estate broker in Florida, issued License Number 0186063. The last license issued was as an involuntary inactive broker, c/o 815 New Waterford Drive, No. 204, Naples, Florida 34104. On or about August 24, 1995, Respondent executed a form 400.5 and submitted it to the Division to register as a salesperson with Sentry Realty and Property Management, Inc. ("Sentry"). At all times relevant to these proceedings, Respondent was registered with the Division as employed by Sentry. On or about September 7, 1995, Respondent facilitated a contract for sale and purchase (the "contract") between Robert Trindle as buyer and John Petracelli as seller/builder for property described as Hallandale Park, Plat Book 12, Page 37, Block 37, Lots 6,7,8, a/k/a approximately 2801 North East 214 Street, North Miami Beach, Florida. Mr. Trindle testified that he intended to purchase a townhouse to be built by Mr. Petracelli as part of a project to include 40 to 50 townhouses. The contract provided that a $3,900 deposit was to be held by "Lee H. Davis Escrow Agent." Mr. Trindle gave Respondent two checks totaling $3,900, as the earnest money deposit on the purchase price of $130,000. The first check, dated October 9, 1995, was for $1,000. The second check, dated November 3, 1995, was for $2,900. The checks were made out to "Lee H. Davis-- Escrow." Also noted on the checks was "Davena Group Inc.," which Mr. Trindle understood to be Respondent's real estate company. Each check was negotiated by Respondent within a week of its receipt. At the time of this transaction, Respondent's registered broker was John Brouillette of Sentry. Respondent did not place the escrow deposit with Mr. Brouillette, who testified that he knew nothing of the transaction at the time it occurred and never saw the contract. Respondent represented to Mr. Trindle that he would maintain the escrow deposit as broker during this transaction. Mr. Trindle did not give Respondent permission to transfer the escrow deposit to the builder/seller, Mr. Petracelli. Correspondence from Respondent indicated that he did turn the escrow deposit over to Mr. Petracelli, without informing Mr. Trindle. Mr. Petracelli never built the promised townhouses. Rather, he left the country, absconding with Mr. Trindle's escrow deposit along with monies provided by other purchasers and/or investors in the project. Mr. Trindle attempted to contact Respondent regarding the status of his escrow deposit, but was unable to reach him prior to the filing of his complaint with the Division. As of the date of the hearing, the earnest money deposit had not been returned to Mr. Trindle.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by Petitioner finding that Respondent has violated Subsections 475.25(1)(b), 475.25(1)(d)1, 475.25(1)(e), 475.25(1)(k), and 475.42(1)(d), Florida Statutes, as alleged in the Administrative Complaint issued against Respondent, and that Respondent's real estate license be revoked. DONE AND ENTERED this 13th day of March, 2001, in Tallahassee, Leon County, Florida. ___________________________________ LAWRENCE P. STEVENSON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of March, 2001. COPIES FURNISHED: Sunia Y. Marsh, Esquire Department of Business and Professional Regulation Division of Real Estate 400 West Robinson Street Suite N-308A Orlando, Florida 32801-1772 Lee H. Davis 815 New Waterford Drive, No. 204 Naples, Florida 34104 Herbert S. Fecker, Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
Recommendation Based upon the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that the Florida Real Estate Commission enter a final order holding Respondent, Stephen E. Schiller, t/a Allstate Realty, guilty of violating Section 475.25(1)(b) and (k), Florida Statutes (1985), under Counts I and II of the Administrative Complaint in this case, and suspending his real estate broker's license no. 0374362 for one year. DONE and ORDERED this 27th day of August, 1986 in Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 27th day of August, 1986.
The Issue Whether Respondents' license as real estate brokers in the state of Florida should be revoked, suspended or otherwise disciplined based upon the allegations of misconduct in the Administrative Complaint.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: At all times material to this proceeding, the Respondent, Deering, was licensed as a real estate broker in the state of Florida, having been issued license number 0563366. At all times material to this proceeding, Respondent, Advantage, was licensed as a real estate broker, having been issued license number 0273342. At all times material to this proceeding, Respondent, Deering, was licensed and operating as the qualifying broker for Respondent, Advantage. On October 22, 1992, Petitioner conducted an office inspection and audit of Advantage. The audit reflected what appeared to be a shortage in Advantage's security deposit escrow account (Number 027000122700) in the amount of $580.00, calculated as $6,600.00 in total trust liability, but only $6,020.00 as a reconciled bank balance. The audit also reflected what appeared to be a shortage in Advantage's rental distribution escrow account (Number 27000121900) in the amount of $369.40, calculated as $3,174.82 in total trust liability, but only $2,805.42 as reconciled bank balance. The audit also reflected that Deering, as the qualifying broker, failed to sign and properly reconcile Advantage's escrow accounts by comparing the total trust liability with the reconciled bank balance of the escrow accounts for the months of September and October, 1992. Marie Deering, Respondent, Deering's, wife and a corporate officer of Respondent, Advantage, signed the reconciliation form for the months of September and October, 1992. It appears from the record (Petitioner's Exhibit 1, Respondents' Licensure file) that Roger J. Kathman was the Broker of Record for Respondent, Advantage until August 21, 1992, when he resigned. Apparently, part of the problem stemmed from using a form developed by the previous real estate agency which was not the form suggested by the Petitioner for this purpose. Since being advised about the form and that comparing the total trust liability of each escrow account with the reconciled the bank balance of each escrow account and signing the reconciliation form was the responsibility of the broker of record, Deering has been properly fulfilling that responsibility and reporting on the correct form. The total trust liability of Advantage's security deposit escrow account should have been $5,700.00 rather than the $6,600.00 indicated by the audit because the $900.00 included in the audit figure from the San Juan lease should not have been included since this amount was not to be escrowed pursuant to the lease. This was a verbal agreement between the parties that was later executed as an addendum to the lease. Advantage's reconciled bank balance for the security deposit escrow account should also be $5,700.00, calculated as $6,020.00 reflected in the audit, minus $1,000.00 that was erroneously disbursed from the Rental distribution escrow account (also called the property management escrow account) instead of the security deposit escrow account , plus $680.00 that was erroneously deposited into the rental distribution escrow account instead of the security deposit escrow account ( $6,020.00 - $1,000.00 + $680.00 = $5,700.00). The total trust fund liability of the rental distribution escrow account should be $3,175.42, calculated as $3,174.82 as reflected in audit plus $0.60 to correct bookkeeping error ($3,174.82 + $0.60 = $3,175.42). The reconciled bank balance for the rental distribution escrow account should be $3,175.42, calculated as $2,805.42 reflected in the audit, plus $1,000.00 transferred from the security deposit escrow account as reflected in Finding of Fact 8, minus $680.00 transferred to the security deposit escrow account as reflected in Finding of Fact 8, plus a deposit of $50.00 to correct an error made in crediting a tenant account with $50.00 more than was deposited from tenant ($2,805.42 + $1,000.00 - $680.00 + $50.00 = $3,175.42). Although there were clerical or bookkeeping errors made in the handling of Advantage's escrow accounts, there was no evidence that Deering failed to immediately deposit funds received in trust in an escrow account, albeit not always the correct one. After the audit, Respondent, Deering promptly and properly corrected the escrow accounts and accounted for the funds resulting in balanced escrow accounts. While the Respondents were negligent in the handling of the escrow accounts, there is insufficient evidence to establish facts to show that Respondents were culpably negligent or that there was a breach of trust. The Respondents' license as real estate brokers in the state of Florida has never been disciplined.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Commission enter a Final Order finding Respondent Deering and Respondent Advantage guilty of technical violations of Section 475.25(1)(e) and (k), Florida Statutes. For such violations, Respondent Advantage should be given a written reprimand and Respondent Deering should be given a written reprimand and required to complete a 30-hour broker management course. Counts I and II of the Administrative Complaint should be dismissed. In making this recommendation, consideration has been given to the mitigating factors in relation to the disciplinary guidelines set out in Chapter 21V-24, Florida Administrative Code. Also, taken into consideration was the purpose of regulating any profession, the protection of the public by requiring compliance with those laws governing the profession. In this case, the recommended penalties will serve that purpose, the public has not been harmed, compliance has been accomplished and the penalty sufficient to remind the Respondents to be more diligent in the future. Adding any further penalty, including an administrative fine, would be unduly punitive. DONE AND ENTERED this 12th day of October, 1993, in Tallahassee, Florida. WILLIAM R. CAVE 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 12th day of October, 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-0606 The following constitutes my specific rulings, pursuant to Section 120.59(2), Florida Statutes, on all of the proposed findings of fact submitted by the parties in this case. Petitioner's Proposed Findings of Fact. 1. Unnecessary. 2.-12. Adopted in substance as modified by Findings of Fact 1 through 13. Respondent's Proposed Findings of Fact. Adopted in substance as modified in Findings of Fact 4, 5 and 8 through 13. Adopted in substance as modified in Findings of Fact 6 and 7. Adopted in Finding of Fact 15. COPIES FURNISHED: Steven W. Johnson, Esquire Department of Professional Regulation, Division of Real Estate Hurston North Tower #308A 400 West Robinson Street Orlando, Florida 32801 Albert R. Deering, Pro se c/o Advantage Realty of Sarasota, Inc. t/a Century 21 Advantage 4121 Bee Ridge Road Sarasota, Florida 34233 Darlene F. Keller, Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 Jack McRay, Esquire Acting General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1900
Findings Of Fact Petitioner is the governmental agency responsible for issuing licenses to practice real estate. Petitioner is also responsible for regulating licensees on behalf of the state. Respondent, John P. Wickersham ("Wickersham"), is licensed as a real estate broker under license number 0095775. Respondent, Aladdin Real Estate of Rockledge ("Aladdin"), is a Florida corporation registered as a real estate broker under license number 0213244. Wickersham is the qualifying broker and corporate officer for Aladdin. Respondents maintain their escrow account at the Barnett Bank of Cocoa. On April 28, 1994, Ms. Marie Ventura, Petitioner's investigator, audited Respondents' escrow account. Ms. Ventura concluded that Respondents' escrow account had a liability of $46,287.30 and a reconciled balance of $43,557.26. Ms. Ventura concluded that Respondents' escrow account had a shortage of $2,730.04. Respondents provided Ms. Ventura with additional information. On May 16, 1994, Ms. Ventura concluded that Respondents' escrow account had a liability of $43,546.21 and a reconciled balance of $42,787.26. Ms. Ventura concluded that Respondents' escrow account had an excess of $11.05. Respondents never had a shortage in their escrow account. Respondents maintained an excess of $11.05 in their escrow account since September, 1993. In September, 1993, Respondents converted their method of bookkeeping to a computer system. The computer system failed to disclose an excess of $11.05 due to Respondents' misunderstanding of the appropriate method of labeling inputs to the software system. Respondents discovered and corrected the error prior to the formal hearing. Respondents properly made and signed written monthly reconciliation statements comparing their total escrow liability with the reconciled bank balances of their escrow account. Although Respondents did not use the form suggested in Rule 61J2- 14.012(2), Respondents satisfied the substance of the requirements for record keeping and reporting. Respondents maintained the information required in Rule 61J2-14.012(2) in bank statements, ledger cards, and checkbooks. At the time of the formal hearing, Respondents presented the information in a form that complied with the requirements of Rule 61J2-14.012(2). The shortage determined by Petitioner on April 28, 1994, was caused, in part, by errors made by Petitioner's investigator. It was the investigator's first audit, and the information provided by Respondents was not in an easily discernible form. However, Respondents never withheld any information, and Respondents maintained and provided all information required by applicable law.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a Final Order finding Respondent not guilty of violating Section 475.25(1)(b) and Rule 61J2-14.012(2). RECOMMENDED this 18th day of January, 1996, in Tallahassee, Florida. DANIEL MANRY, 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 18th day of January 1996.
