Findings Of Fact At all times pertinent to the charges, Respondent Shanker S. Agarwal was a real estate broker in the State of Florida, having been issued License No. 0312860. At all times pertinent to the charges, Respondent Agarwal was the owner, president, and sole qualifying broker for Respondent Super Realty, Inc., a corporation registered as a real estate broker, having been issued License No. 0231636. The Respondents were properly and appropriately served with the Administrative Complaint herein and have had sufficient notice of formal proceedings in this cause, commensurate with the applicable statutes and rules governing disciplinary proceedings. On or about March 13, 1985, Jeanette and David Miller tendered an offer to purchase real estate owned by the Veterans Administration (VA). On March 18, 1985, the VA accepted their offer. Upon making the offer to purchase, Mrs. Miller entrusted to the Respondents an escrow deposit of $500. Upon the offer being accepted, and pursuant to the terms of the contract, Mrs. Miller entrusted an additional escrow deposit of $9,500 to the Respondents. The transaction was scheduled for closing on June 26, 1985. The VA prepared a deed for closing which was sent to the Respondents. At the scheduled date and time of closing, Mrs. Miller appeared prepared to pay by certified checks in her possession, the balance she understood would be due so as to effect the transfer of the new property. However, prior to actually signing the closing papers at the scheduled date and time of closing, she discovered that an extra $6,000 had been added to the closing documents. That amount involved a mortgage with a balloon payment to Respondent Agarwal's wife and one or more mortgages or liens placed upon Mrs. Miller's present home. The closing documents which would have been the best evidence of fraud were not offered at hearing but adequate evidence of their unavailability was made and I accept the unrefuted testimony of Mrs. Miller concerning what she read on the closing documents at the time in question. Mrs. Miller questioned these items in the closing package. Then questioned, Respondent Agarwal first stated that Mrs. Miller should sign and he would explain when they got back to his office. When she persisted, Agarwal flew into a rage. He berated and cursed Mrs. Miller in the presence of several third parties gathered for the closing. When he called her a "bitch," Mrs. Miller was reduced to tears. Mr. Agarwal then stormed out of the room in which the closing was to be conducted. The closing was never consummated. Although still anxious to purchase the house in question, the Millers, through an attorney, demanded from Respondent Agarwal the return of their $10,000, which they understood had been placed in escrow. They sought the help of an attorney because they were unable to get any response from Agarwal despite numerous telephone calls. However, they did not ever demand the deed from Respondents. On August 5, 1986, during the investigation of this matter by the Petitioner, Investigator Anthony Nicola served upon Respondent Agarwal's wife, Pushpa Agarwal, who was present at the offices of Respondent Super Realty, Inc., a subpoena intended for and addressed to "Mr. Shanker Agarwal, c/o Super Realty, Inc." This subpoena was a Department of Professional Regulation subpoena duces tecum number A-004804 issued in Department of Professional Regulation Case No. 0153241 requesting production of "Escrow Account records relative to $500.00 deposit received from Jeanette & David Miller on March 13, 1985." It required production of these papers at another address on August 6, 1986, at 9:00 a.m. The Respondents did not respond to the subpoena. On or about October 17, 1985, the VA, upon learning of the aborted transaction, directed the Respondents to send $500 to the VA, along with a return of the deed. The VA further instructed the Respondents to return the balance of $9,500 to the Millers. The $500 demanded by the VA was in the nature of a penalty or forfeiture for having tied up the property for the intervening months since the closing had been scheduled. Respondent Agarwal notified the VA on November 16, 1985 that because there were conflicting demands on the money, he could not turn over the money or deed to the VA until the Circuit Court resolved the demands. However, neither the VA nor the Millers are aware of any legal action instigated by Respondent. Mrs. Miller, however, had instituted suit against the Respondents to recover her $10,000. No notification of doubt or conflicting demands on deposit in escrow was received by the Florida Real Estate Commission from the Respondents pursuant to Section 475.25(1)(d), Florida Statutes. To the date of formal hearing, the Respondents had never accounted for or delivered to either the VA or the Millers any part of the $10,000 nor the deed. Further, the Respondents never advised the Millers that the VA had directed them how to disburse the funds. The Millers testified they had become aware of the disbursement recommended by the VA through calls placed to the VA by them and their lawyer, that such a disbursement would have been acceptable to them, and that such a disbursement by Respondents would have resolved any dispute they had with Respondents had that disbursement been made by Respondents. Mrs. Miller testified that her lawsuit has been protracted and is yet to be resolved because Respondent Agarwal's outbursts of temper and assorted motions have resulted in rotation of three judges and in Mrs. Miller having to obtain new legal counsel, however he is aware that the VA and the Millers agree to the disbursement proposed by the VA. Respondent Agarwal also threatened to turn Mrs. Miller over to the Internal Revenue Service. Mrs. Miller does not know what this threat was intended to mean or what it was supposed to accomplish. Petitioner elected to put on no evidence in support of Counts IX and X of the Administrative Complaint.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Florida Real Estate Commission enter a Final Order finding Respondents guilty only on Counts I through TV of the Administrative Complaint, exacting a penalty of revocation of both licenses therefore, and dismissing Counts V through X of the Administrative Complaint. DONE AND RECOMMENDED this 28th day of July, 1987, in Tallahassee, Leon County, Florida. ELLA JANE P. DAVIS 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 28th day of July, 1987. COPIES FURNISHED: James R. Mitchell, Esquire Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Shanker S. Agarwal c/o Super Realty, Inc. 6147 Washington Street Hollywood, Florida 33023 Harold Huff, Executive Director Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Honorable Van B. Poole Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Joseph A. Sole, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750
Findings Of Fact Respondent Ray T. Kline is and at all times material to the charges in this action was a registered real estate broker holding License No. 0048253. Respondent Vincent Tomasino is and at all times material to the charges in this action was a licensed real estate salesman holding License No. 0353215. Respondent Krishnalall D. Persaud is and all times material to the charges in this action was a licensed real estate salesman holding License No. 0336161. At the time of the hearing the Respondent Persaud had obtained his broker's license. In December, 1980, the Respondents Tomasino and Persaud were employed as salesmen, selling time-share units at Vistana Development. During December they discussed and agreed upon a business plan for marketing time-share units. As a part of that plan-they agreed to form Intercontinental Marketing Services, Ltd. (hereafter referred to as IMS) a corporation which would be used to market time-share condominiums and other real estate. Subsequent to that time they did in fact incorporate on May 4, 1981, as a Delaware corporation and formed another Delaware corporation to handle travel and tour business. The incorporators of these corporations were the Respondents Tomasino and Persaud who were also officers and directors of both corporations. Sometime between December, 1980 and March, 1981 Persuad introduced Respondent Ray Kline to Respondent Tomasino. They discussed Ray Kline becoming the registered broker for IMS. After some discussion, Ray Kline did in fact agree to become the broker for IMS. On January 19, 1981, Respondent Tomasino and Respondent Persaud opened a general corporate account for IMS at the Atlantic Bank of Orlando. (See Petitioner's Exhibit 6) The account required two signatures for all checks and the two persons allowed to sign were Respondents Tomasino and Persaud. This account was not set up as an escrow or trust account and was not used a's an escrow or trust account during the operating life of IMS. At no time was the Respondent Ray T. Kline a signator on this account. In early 1931 the Respondents Persaud and Tomasino began negotiating with the Highlands County Title and Guaranty Land Company (hereafter referred to as Highlands County Title) to become its representative in the Orlando area. Highlands County Title is a subsidiary of Sun-N-Lake Estates which is the owner and developer of Lakeside Villas located near Sebring, Florida. A verbal agreement was reached between Highlands County Title and IMS whereby IMS would market time-share units in Lakeside Villas in the Orlando area. This verbal agreement was later reduced to writing. (See Petitioner's Exhibit 11) On or about March 3, 1981, IMS and Respondent Ray T. Kline entered into a written agreement whereby Ray T. Kline agreed to act as the real estate broker for IMS. (See Respondent Kline's Exhibit 3) Highlands County Title and Sun-N- Lake Estates required a broker be designated for all its sales representatives. Under the written agreement Mr. Kline agreed generally to act as broker and to not interfere with any of the marketing projects of IMS. IMS was to provide Respondent Kline with an office, secretarial assistance, a phone, and real estate leads acquired through IMS advertising. The contract required Kline to maintain an escrow account for his real estate transactions and to pay twenty- five percent of all commissions earned by him on real estate transactions other than his on personal business. There was no requirement in the contract that Ray T. Kline open or maintain an escrow account for real estate transactions handled by IMS. On March 3, 1981, Ray T. Kline changed his broker address to 1121 South Cimarron Boulevard, Winter Park, Florida, the offices of IMS. At the time Mr. Kline moved his license to the IMS office he did not register or reflect a trade name under which he was doing business as a broker. On March 5, 1981, Vincent Tomasino and Krishnalall Persaud placed their salesman licenses with Ray T. Kline as an individual broker employer at 1121 Cimarron Boulevard, Winter Park, Florida. IMS was not registered or qualified with the Board of Real Estate or the Department of Professional Regulation by the Respondents. On March 16, 1981, a written agreement was entered into between IMS and Highlands County Title. The agreement showed Ray T. Kline as broker for IMS and was signed by Vincent Tomasino as director of IMS and Ray T. Kline, Jr. as broker. On March 18, 1981, a supplement to that written agreement was entered into between Ray T. Kline, IMS, and Highlands County Title whereby Highlands County Title agreed to pay advance draws against commissions to IMS. This supplement to the original agreement was signed by Ray T. Kline on behalf of IMS. Mr. Dennis Grage had met and become acquainted with Vincent Tomasino when Mr. Tomasino was selling time-share units at Vistana. In early March, 1981, Vincent Tomasino contacted Mr. Grage to see if he was interested in purchasing time-share units in Lakeside Villas. Shortly after the initial contact Mr. Tomasino took Mr. Grage's wife, Barbara, together with Richard and Benita Drapeau (Mrs. Grage's sister and her husband) on a tour of Lakeside Villas. After the tour Mr. Tomasino and Mr. Grage met regarding the purchase of a unit in Lakeside Villas. Mr. Grage explained to Mr. Tomasino that he could not afford the $600 down payment. Mr. Tomasino then told Mr. Grage that if he would get the Drapeaus and the Brownings to buy a time-share unit in Lakeside Villas, he would pay $500 of the down-payment on a time-share unit for Mr. Grage. After the tour Mr. and Mrs. Drapeau decided to buy four time-share units in Lakeside Villas. However, after returning to their home in New Hampshire they decided to buy only two time- share units and so informed Vincent Tomasino. The Drapeaus then sent two deposit checks of $400 each dated March 30, 1981 and April 11, 1981 to Vincent Tomasino. These checks were made payable to Vincent Tomasino pursuant to his instructions. These two checks were deposits on two time-share units at Lakeside Villas. The March 30, 1981 check was deposited in the IMS corporate account on April 7, 1981. The April 11, 1981 check was endorsed by Vincent Tomasino and forwarded to Sun-N-Lake Estates where it was deposited in the Sun-N-Lake Estates attorney's escrow account. The $400 from the March 30, 1981 deposit check was never forwarded by IMS or Vincent Tomasino to Sun-N-Lake Estates. Pursuant to the agreement with Vincent Tomasino regarding the down payment on a time-share unit, Dennis Grage forwarded a $100 deposit to Mr. Tomasino. The balance of the $600 deposit called for in the contract was to be paid by Vincent Tomasino. Mr. Grage also contacted John and Helen Browning. In March, 1981, Dennis Grage contacted John and Helen Browning at their home in Michigan. He discussed with them the possibility of purchasing a time-share unit at Lakeside Villas. During this conversation the Brownings authorized Mr. Grage to place a $100 deposit on two units for them. By letter dated March 9, 1981, Vincent Tomasino acknowledged on behalf of IMS the receipt of the deposit placed by Dennis Grage for the Brownings. The Brownings then asked for more information regarding the time- share units and inquired of Mr. Tomasino as to whom the deposit check should be made payable. They were advised by Mr. Tomasino to make the check payable to IMS. On March 20, 1981, the Brownings sent a $1,000 deposit check to Vincent Tomasino payable to IMS. By letter dated March 23, 1981, Vincent Tomasino acknowledged receipt of the $1,000 deposit and also forwarded two time-share purchase agreements to the Brownings for their signatures. Each of the contracts called for a $500 deposit. On April 7, 1981, the Brownings executed the two purchase agreements and returned them to Vincent Tomasino. The Brownings' $1,000 deposit check was deposited into the IMS corporate account at the Atlantic Bank on or about March 24, 1981. On May 18, 1981, Vincent Tomasino wrote a check to Sun-N-Lake Estates in the amount of $1,000 for the Brownings' deposit. The check was received and deposited for collection by Sun-N-Lake Estates but before it could be paid Vincent Tomasino placed a stop-payment order on the check. The stop-payment order was placed because there were insufficient funds in the account to cover the $1,000 check. The $1,000 deposit was never forwarded to Sun-N-Lake Estates by IMS for Vincent Tomasino. In May, 1981, Vincent Tomasino removed Krishnalall Persuad as a signator on the IMS account at the Atlantic Bank. This occurred primarily as a result of a disagreement over a $1,200 deposit made by Mr. Persaud to an account other than the IMS account. Also during May, 1981, Vincent Tomasino changed the locks on the doors at the IMS offices at 1121 South Cimarron Boulevard, Winter Park, Florida, and did not give Mr. Persaud a key. Prior to May, 1981, the checking account at Atlantic Bank had been controlled by both Mr. Persaud and Mr. Tomasino. From January to May, 1981, checks written on the IMS account were signed and approved by both Tomasino and Persaud. Respondent Persaud knew or reasonably should have known that money being received from purchasers was being deposited in the corporate account. After May, 1981, only Vincent Tomasino signed checks on the IMS account. In June, 1981, the relationship between Mr. Persuad and Mr. Tomasino terminated. Also in June, 1981, the IMS account became overdrawn and in August, 1981, the Atlantic Bank closed the account. Between January and June, 1981, Vincent Tomasino received approximately $7,000 in draws from IMS and Mr. Persaud received approximately $4,900 in draws from IMS. Ray T. Kline received no funds from IMS. When interviewed by a DPR investigator Mr. Persaud denied having received any funds from IMS during its operation. Between January and June, 1981, Vincent Tomasino was the person in charge of the IMS finances. Ray Kline had no control over and did not participate in the finances of IMS. The bookkeeping was done by the office manager and the checkbook was kept by Mr. Tomasino. During this period salesmen were hired and supervised by Tomasino and Persaud, but were not supervised by Respondent Kline. IMS also purchased a tour bus during this period which was used by Mr. Persaud to take potential buyers on tours of Lakeside Villas. Once these tours began, Mr. Persaud was in the office less than he had been the first couple of months of operation. Once there were no more funds in the corporate account the Respondent Tomasino essentially walked away from the corporation and paid only a few small debts. By letter dated June 23, 1981, Vincent Tomasino notified Sun-N-Lake Estates that IMS would no longer sell time- share units at Lakeside Villas. In November, 1981, the relationship between IMS and Sun-N-Lake Estates was formally terminated. Prior to termination, IMS had received advances of $9,000 in excess of commissions due and earned and no reimbursement of those excess funds has been made to Sun-N-Lake Estates. In approximately September, 1981, the Drapeaus as a result of financial problems sent a letter to Sun-N-Lake Estates requesting a refund of their $800 deposit. Sun-N-Lake Estates refunded the $400 which was in escrow and informed the Drapeaus that Sun-N-Lake Estates had never received the other $400 deposit. Robert Wright of Sun-N-Lake Estates was contacted by the Drapeaus. He then contacted Vincent Tomasino who told him that he would speak with Ray Kline and Krishnalall Persaud about the Drapeau problem. Mr. Wright was never contacted again by Mr. Tomasino. Dennis Grage, after learning that the Drapeau's $400 deposit had not been placed in escrow also contacted Vincent Tomasino. He demanded the return of the $400 deposit and Mr. Tomasino stated that someone had run off with the money and that he was trying to get it back. After several unsuccessful contacts with Mr. Tomasino, Mr. Grage contacted Ray Kline. Mr. Kline said he was checking on the problem, but at the time of the formal hearing the Drapeau deposit had not been refunded. Dennis Grage also informed the Brownings of the problems the Drapeaus were encountering. The Brownings then contacted Sun-N-Lake Estates and spoke with Robert Wright who informed them that Sun-N-Lake Estates had never received their $1,000 deposit. Mr. Tomasino informed him that IMS was bankrupt and had no money and that it wasn't his problem. Mr. Browning then contacted Ray Kline who denied any personal responsibility and stated that Tomasino had taken the money and was responsible for its return. Mr. Browning then made demand upon Krishnalall Persaud for the $1,000 deposit and Mr. Persaud denied being an officer or director of IMS and also stated that he had no responsibility to the Brownings. During August and September, 1981, Robert Wright repeatedly discussed the Drapeau and Browning deposits with Respondents Persaud and Kline. On each occasion they denied any responsibility for those deposits. Until contacted by the Brownings and Drapeaus, Ray Kline and Krishnalall Persaud had no knowledge of the deposits of these people and how they were being received. Ray Kline, after being contacted was aware that these deposits were funds that should have been placed in escrow upon receipt by IMS and Tomasino. Neither Tomasino, Kline, nor Persaud attempted to provide an accounting to the Drapeaus or Brownings and the Respondents made no attempt to return their deposits. For at least a two week period in the Spring of 1981, Ray Kline also opened and operated a branch office for IMS at a condominium development. At no time was this branch office registered as required by statute. From the beginning of the relationship between Ray Kline and IMS, by agreement, Kline's involvement was to be very limited. Kline never opened an escrow account for IMS and did not supervise the sales personnel. Ray Kline had little or no involvement in the day-to-day operation of IMS. At no time was IMS registered with the Florida Real Estate Commission or the Department of Professional Regulation. At some point in time in the Spring of 1981, the Respondents discussed opening an escrow account but decided to not open such an account until they had earned commissions. From January through May, 1981, Respondents Tomasino and Persuad hired and supervised salesmen and controlled the operations of IMS.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the license of Vincent Tomasino be revoked and that an administrative fine of five hundred dollars ($500) be imposed upon him; That the license of Ray T. Kline be suspended for a period of two (2) years and an administrative fine of one thousand dollars ($1,000) be imposed upon him; and That the license of Krishnalall Persaud be suspended for a period of two (2) years and an administrative fine of five hundred dollars ($500) be imposed upon him. It is further RECOMMENDED that upon a showing by the Respondents to the Commission prior to entry of the final order that restitution has been made to Mr. and Mrs. Drapeau and Mr. and Mrs. Browning, the fines of Respondents Tomasino, Kline and Persaud be reduced to two hundred fifty dollars ($250), five hundred dollars ($500), and two hundred fifty dollars ($250), respectively. DONE and ENTERED this 22nd day of September, 1983, in Tallahassee, Florida. MARVIN E. CHAVIS, 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 22nd day of September, 1983.
The Issue Whether Carleen Chalk Lund, an active broker in Lund Realty, Inc. , a licensed corporate broker, failed to account or deliver to Daisy and Kenneth Parnell money in the form of a deposit which had come into her hands and which was not her property or which she was not in law or equity entitled to retain, under the circumstances, and at the time which was agreed upon or which was required by law or, in the absence of an agreed upon time, upon demand of the Parnells, who were entitled to such an accounting or delivery.
Findings Of Fact Carleen Chalk Lund and Norman Wayne Lund are registered real estate brokers holding current registration from the Florida Real Estate Commission and are active brokers in Lund Realty, Inc., a corporate broker registered with the Florida Real Estate Commission. On or about January 4, 1975, Daisy and Kenneth Parnell, the buyers, signed an offer to purchase the following real property from David and Wilma Hammer: East 184.5 ft. of NW 1/4 of SW 1/4 of Sec 6, Twp. 26 S, Range 29 E, N Osceola County. Said offer was accepted by the sellers. Subsequently, the buyers sent a telegraphic money order in the amount of $2,200 to Lund Realty, Inc. Therefore said money was deposited in the escrow account of Lund Realty, Inc. $2,000 as deposit on the Hammer's property and $200 to be used for closing costs. The following provisions of the Contract for Purchase between the buyers and the sellers are specifically noted and referenced: In accordance with provisions of paragraph 4, the contract was to be closed and the deed delivered on or before January 31, 1975. In accordance with the provisions of paragraph 6, the seller was to convey title to the aforesaid property to the buyer by agreement for deed. In accordance with the provisions of paragraph 7, the costs, if any, of preparation of closing documents and closing fee shall be borne equally by the seller and buyer. In accordance with the provisions of paragraph 9, all closing costs were to be divided equally between the buyer and seller including title insurance. In accordance with paragraph G of said standards, if the buyer failed to perform any of the covenants of the contract within the time specified, the deposit paid by the buyer might be retained by or for the account of the seller as consideration for the execution of the contract and in full settlement of any claims for camages and all parties would be relieved of all obligations under the contract and each party would execute a separate release of the other at that time. In accordance with the provisions of paragraph P of the standards, in the event that the buyer failed to perform and the aforesaid deposit was retained, the amount of the deposit was to have been divided equally between the realtor and the seller provided that the amount to be retained and received by the realtor would not exceed the full amount of the commission and that any excess would be paid to the seller. In accordance with the provisions of the paragraph "Commission to Realtor", the seller acknowledged the employment of Lund Realty, Inc. and agreed to pay Lund Realty a commission in accordance with the commission agreement. On January 25, 1975, copies of the articles of agreement, closing statement, and title insurance cost disclosure were sent by Chelsea Title and Guaranty Company to Mrs. Daisy Parnell at 88 North Pasack Road, Spring Valley, New York, 10977. The letter accompanying the aforementioned documents indicated that the sellers had executed the closing papers on that date. Said letter further indicated that as soon as the papers were signed by the recipient, that Dee A Burttram, manager of Chelsea Title and Guaranty Company, would record the articles of agreement and insure title to property. These papers were net signed and returned to Chelsea Title, and on February 14, 1975 a subsequent letter was addressed from Dee A. Burttram to airs. Daisy Parnell at the aforestated address indicating that Chelsea Title had not received the documents forwarded to Mrs. Parnell and offering further information if they had not been completed. See Composite Exhibit 10. Between January 25 and February 28, 1975 efforts were made by Lund Realty, Inc. to contact airs. Daisy Parnell without success. On February 28, 1975 it was determined that Frank Townsend, Attorney at Law practicing in Kissimmee, had been engaged by Sidney Schwartz, Attorney at Law practicing in New York, to review the contract entered into by Mrs. Daisy Parnell. According to his testimony, Frank Townsend recommended to Schwartz that Mrs. Parnell not go through with the contract until certain discrepancies in the contract were clarified. The discrepancies involved were the conflict between the provision of paragraph 2 stating that $8,000 purchase money note and mortgage to the seller while paragraph 6 indicated that the seller would convey title by an agreement for deed; the lack of a scribner's statement note on the papers to be filed with the Court; and a discrepancy between the amount of monthly payment as stated in the Contract for Sale and Purchase and the Agreement for Deed. However, by his letter of March 5, 1975 to Mrs. Daisy Parnell, Townsend refers only to problems involving the use of the Agreement for Deed which he concluded was not a problem if the sellers insisted on that form of conveyance, and the fact that the Agreement for Deed is unacceptable because it is unrecordable (an apparent reference to the fact that a scribner's notation was not made on the Agreement for Deed). By his letter of April 3, 1975 to Mr. Sidney Schwartz, Mr. Townsend indicates that he had completed all back ground work on the transaction and had advised Mr. Murray W. Over street, attorney for Mr. and Mrs. Hammer three weeks prior that he (Townsend) was ready to provide a note and mortgage in exchange for a Warranty Deed and had requested that Overstreet arrange a closing date. Mr. Townsend closes indicating that he had again contacted Mr. Overstreet reminding him that the Parnells wished to close. Several things are apparent from Townsend's letters of March 5 and April 3, 1975. It is apparent from the letter to Mrs. Parnell from Townsend dated March 5, 1975 that substantial concern existed on the part of Schwartz that the use of an Agreement for Deed in the transaction would provide to Mrs. Parnell less protection than she would have in a situation in which a note and mortgage was used. However, as stated above, Townsend pointed out that the use of an Agreement for Deed under the Florida Law would afford Mrs. Parnell the same protection as a mortgage. It is also clear from the April 3 letter that all problems related to the Parnell-Hammer transaction had been resolved, that they were ready to close but insisted upon a note and mortgage in exchange for a warranty deed, and their position had bean communicated to counsel for the Hammers. The demand for the use of a note and mortgage by the Parnells is contrary to the provisions of the Contract for Sale and Purchase between these parties entered into on January 4, 1975 and as of April 3, 1975 was the only reason for the Parnell's refusing to close. On April 3, 1975, Mr. Murray Overstreet attorney for Mr. and Mrs. Hammer, advised Frank N. Townsend, attorney for Mrs. Parnell, that the Hammers considered their Contract for Sale and Purchase with Mrs. Parnell to be null and void because the transaction was to be closed on or before January 31, 1975 and that as of April 3, 1975 the matter had not been completed. Mr. Overstreet further advised that his clients made no claim on the deposit made to Lund Realty and that said deposit might be returned to the buyers. A copy of this letter was sent to Lund Realty, Inc. Pursuant to the provisions of paragraph G of the Contract for Sale and Purchase referenced above, upon default of the buyer, the deposit paid by the buyer could be retained by or for the account of the sellers as consideration for the execution of the contract and in full settlement of any claims for damage. Under the provisions of paragraph P of said contract, said deposit would be divided equally between the realtor and seller; provided, however, that the amount retained or received by the realtor was not to exceed the full amount of the commission, in this instance $600. On April 4, 1975 in response to the copy of the letter from Overstreet to Townsend in which the Hammers declared the Contract for Purchase and Sale null and void, Lund Realty, Inc. wrote Frank Townsend advising him that the expenses for sales commission, cancellation fee, and termite inspection should be considered before any escrow funds were disbursed and requesting that Lund Realty be advised as to how Mrs. Parnell would like to handle the charges. Clearly, Lund Realty considered the Parnells to be in default and asserted a claim for commission. No evidence was received regarding any response from Townsend to the letter of Lund Realty, Inc. dated April 4, 1975. On May 14, 1975 Lund Realty wrote Mrs. Daisy Parnell sending her a check in the amount of $1,466, the amount of her deposit less expenses incurred by her for sales commission, cancellation fee, termite inspection, and insurance. The amounts of each of the expenses and copies of statements were enclosed. Although the check in question was retained by Mrs. Parnell, Lund Realty received a letter from Sidney Schwartz dated May 23, 1975 which states in pertinent part as follows: "I am led to believe that the seller in the proposed transaction did not perfect title and waived and/or released its interest in the contract. If this be so, the entire down pay ment of Mrs. Parnell must be returned to her imme- diately. Please inquire into this matter. You no doubt are aware that Mrs. Parnell has retained Florida counsel, namely, Frank N. Townsend, Esquire, Post Office Box 847, Kissimmee, Florida. This is further to advise that in the event there has been a wrongful retention of any of Mrs. Parnell's funds, complaints shall be lodged with all appropriate authorities including licen- sing authorities in the State of Florida." The next contact between the parties was a letter to Lund Realty from Frank Townsend dated June 19, 1975. In that letter, Mr. Townsend stated as follows: "This confirms our request in accordance with Mr. Overstreet's letter wherein no demand is made for any funds on behalf of the Hammers, the return of all funds deposited with you by the Parnells is specifically requested." A second follow-up letter was addressed to Lund Realty on July 14,1975 requesting a response to the aforementioned letter of June 19, 1975. It is clear that the basis for demand of return of the deposit receipt in its entirety was based on the statements in Overstreet's letter to Townsend dated April 3, 1975, that the Hammers made no claim to the deposit to Lund Realty, Inc. This position of the Hammers was subsequently clarified by Mr. Hammer in his letter of August 12 (Exhibit 7) and by Mr. Overstreet, who at the hearing, testified that the Hammers never intended to waive the amount of the commission and the cost. Lund Realty was entitled to its commission and the Hammers would have had a cause of action against the Parnells under the contract for the entire amount of the deposit. However, the existence of a dispute over claims to all or portions of the escrow funds developed slowly, and was based on whether the Hammers waived their rights to all or any portion of the escrow funds. In September 1975 Lund Realty requested an advisory opinion of the Florida Real Estate Commission regarding its duties. The conclusion of that advisory opinion was that disbursement should be made to the Parnells, and that the claims that Lund, Chelsea Title and any other individuals should be filed in a court of competent jurisdiction. The advisory opinion was silent, however, on Hammer's subsequent claim for the commission and cost from the deposit. As of the date of hearing, the $2,200 was on deposit in the escrow account of Lund Realty, Inc.
Recommendation The position and actions of the various individuals should also be considered in this case in arriving at a penalty because none of the parties have completely "clean hands." The Parnells precipitated the breach by insistence on a note and mortgage; the Hammers have made no attempt to clarify the situation by paying the commission and cost; and the attorneys kept Lund Realty completely in the dark about what was transpiring. The Lunds are the only ones involved in the transaction who have tried to carry out their obligation. Further, they also are the only ones who stand to lose financially without seeking judicial relief. While they have held the money, it has remained in escrow since the dispute arose. Based on the foregoing Findings of Fact, Conclusions of Law, and other factors bearing on the case, the Hearing Officer would recommend that the Florida Real Estate Commission place Carleen Chalk Lund on probation for one year. DONE and ORDERED this 28th day of January 1977 in Tallahassee, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings Room 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Manuel E. Oliver, Esquire Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789 Carleen Chalk Lund 612 West Vine Street Kissimmee, Florida 32741
The Issue Whether Respondents' registrations with Petitioner should be suspended or revoked for alleged violation of Sections 475.25(1)(a), (c), and (i), Florida Statutes, as set forth in the Administrative Complaint dated march 24, 1978.
Findings Of Fact Respondent Madeline Rose Parr is now and was at all times alleged in the Administrative Complaint a registered real estate broker in the State of Florida. She also was at the times alleged in the complaint president, treasurer and active firm member of Exhibit Homes Realty, Inc., a registered corporate broker at Sarasota, Florida. Her husband, Charles H. Parr, III, was secretary of the firm. (Testimony of C. Parr, Petitioner's Composite Exhibit 4) In September 1973 Exhibit Homes Realty, Inc., was the listing broker for certain real property located in Sarasota County, Florida, owned by R. David Beebe, Elizabeth Beebe, Ellen Brewster, Elizabeth B. Klavun, Lucius Beebe and Dorothy Beebe. An offer was made to purchase the property by I. Z. Mann, as Trustee, which was transmitted by Respondent's firm to the sellers on September 24, 1973. On that same date, the prospective purchaser deposited with Respondent's firm a check in the amount of $25,000.00 payable to Exhibit Homes Realty, Inc.'s, escrow account as an earnest money deposit. The check was deposited on September 25 in the escrow account maintained by Exhibit Homes Realty, Inc., Account No. 082-716, in the Palmer First National Bank and Trust Company of Sarasota. The authorized signatories on this account were Respondent and her husband. The transaction was to involve co-brokerage between Respondent's firm and I. Z. Mann Realty Corporation with a 50% division of the 6% brokerage fee to each firm. (Petitioner's Exhibits 2, 3, 5, 6, Testimony of Mann, Shropshire, Respondent, C. Parr) The contract for the sale and purchase of the property was executed by the purchaser, sellers, and Respondent for Exhibit Homes Realty, Inc., on February 8, 1974. The contract recited receipt of the $25,000.00 deposit and provided that the transaction would be closed on or before June 1, 1974. It further provided that if the buyer failed to perform the contract within the time specified, all deposits would be retained for the account of the seller or that the seller could elect to enforce any other remedy available because of such default. The contract also stated that if the buyer should default and the earnest money was retained, it should be applied first to pay seller's expenses and the balance divided equally between the broker and the seller. (Petitioner's Exhibit 1) The closing of the transaction was scheduled for May 31, 1974. John F. Burket, Jr., the Sarasota attorney for the sellers, proceeded to obtain an executed warranty deed from the sellers on the property. On May 28, 1974, Burket was advised that the purchaser had decided to default under the contract and would not attend the scheduled closing. Burket wrote to Exhibit Homes Realty, Inc., informing it of this fact and instructing the broker to make tender of the deed of conveyance at the appointed time for closing if anyone attended in behalf of the purchaser. However, the purchaser failed to appear at the closing and, as a consequence, Respondent returned the deed and other closing documents to Burket and informed him that she would continue to hold the earnest money of $25,000.00 in the escrow account until further instructions from the sellers. The reason for the default was that the purchaser was unable to obtain financing for the prospective use of the property as a multifamily housing development. (Petitioner's Exhibits 8-11, Testimony of Mann, Burket) Negotiations ensued between the attorneys for the sellers and the purchaser resulting in an agreement to exchange releases from liability in consideration of the purchaser's forfeiture of the $25,000.00 deposit and any portion of the real estate commission earned by I. Z. Mann Realty Corporation. In the latter half of November 1974, Burket attempted to contact Respondent by telephone to advise her that an agreement had been reached as to disposition of the deposit, but was unable to contact her. He did inform Respondent's former employee, Maxine Shropshire, who had originally listed the property and obtained the contract thereon, and asked her to advise Respondent of the status of the matter. Mrs. Shropshire did speak to Respondent and told her that Burket had stated that the deposit money was ready to be disbursed. However, Respondent did not communicate with Burket and he therefore wrote her on January 28, 1975, concerning the forfeiture of the earnest money deposit and enclosing a memorandum setting forth the seller's expenses and the division of the deposit in accordance with the contract. The memorandum reflected seller's expenses of $7,994.86 and the amount of $8,502.57 to be retained by Respondent. The letter requested that Respondent provide an escrow check for the balance of $16,497.43 payable to Burket's trust account from which appropriate disbursements would be effected. (Petitioner's Exhibits 12-14, Testimony of Mann, Schropshire, Burket) In the fall of 1974, Charles H. Parr was experiencing financial difficulties in connection with a real estate project in Bradenton due to the recession of that period. He testified that he was beset with creditors, liens and other problems connected with the real estate subdivision "Harbor Woods." In November 1974, he was pressed for funds and therefore wrote four checks on the Exhibit Homes Realty, Inc., escrow account during the period November 1 through November 20, 1974, in the total amount of $25,000.00, thus reducing the balance in the escrow account to $200.00. His explanation for this action was that he intended to have Respondent obtain a $25,000.00 loan which would replace the amount disbursed from the escrow account, but that she was not present at the office. He, therefore, wrote checks on the one account of some fourteen separate bank accounts that he and his wife maintained which had any sizable amount of money in it. However, he testified that he never said anything to the Respondent about using the escrow money to pay his various debts. He subsequently embarked on a series of trips within and without the state, at times accompanied by Respondent, to attempt to obtain financing from foreign and domestic lending institutions. These trips extended into early 1975. During their various returns from these sojourns, the Parrs avoided picking up their mail at the local post office for fear that they would be served with process. As a result, Respondent did not obtain Burket's letter of January 28, 1975, until some time in late February of that year. Mr. Parr testified that his action in writing checks on the escrow account was a mistake and that he was not actually aware that he was using escrow funds until his wife received the letter from Burket, checked the bank account records, and discovered that the deposit money had been spent. Respondent corroborated the above testimony as to the time when she first learned of the depletion of the escrow account. Mr. Parr's testimony that he was unaware that the monies which he spent were from the escrow account is not deemed credible. He wrote checks on the account four separate times during the month of November 1974 and the checks themselves are imprinted "Exhibit Homes Realty, Inc. Escrow Account" in bold type. However, it is also found that Respondent was unaware of the disbursement of the funds until February 1975. It is further found that her failure to learn of the request for an accounting of the deposit money was due to her own negligence in not reviewing monthly bank statements and the check book for the account, or obtaining her mail and that of the firm on a timely basis. (Petitioner's Exhibits 6-7, Respondent's Exhibit 3, Testimony of Respondent, C. Parr) Upon learning of the status of the escrow account, Respondent contacted an attorney to arrange a meeting with Burket. The meeting took place in late March or early April 1975, at which time Burket agreed to accept a third mortgage and promissory note for $16,500.00 on the Parr's residence as security for the obligation. At that time, the Parr's had no available funds and informed Burket that they were initiating Chapter XI proceedings in bankruptcy. Such proceedings were initiated in May 1975 and Burket, as Trustee, was listed as a creditor by reason of the third mortgage on the real estate. Subsequently, mortgage foreclosure proceedings were pursued by the second mortgage on the property. Burket did not receive official notice of the bankruptcy proceedings nor was he made a party to the foreclosure proceedings. Later efforts by the Parrs to negotiate a settlement of the indebtedness with Burket have been unavailing; however, the Parrs are willing to satisfy the indebtedness out of funds received from the sale of lots in the Harbor Woods development over the period of the next two years, subject to the approval of the bankruptcy court. (Petitioner's Exhibits 15-16, Respondent's Exhibits 1-2, 4-6, Testimony of C. Parr, Respondent, Ball, Burket) Respondent enjoys a good reputation for honesty and fair dealing in real estate and other business transactions in the community. (Testimony of Tabler, Elmore, Hansen)
Recommendation It is RECOMMENDED: That the registration of Respondent Madeline Rose Parr as a real estate broker be suspended for a period of six months for violations of Subsection 475.25(1)(c) and (i), Florida Statutes, but that enforcement of the suspension be stayed and the Respondent be placed on probation for a like period under such terms and conditions as determined by Petitioner Florida Real Estate Commission. That Respondent Madeline Rose Parr be administered a public reprimand for the above-cited violations of Chapter 475. DONE AND ENTERED this 8th day of December 1978 in Tallahassee, Florida. THOMAS C. OLDHAM Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 8th day of December 1978. COPIES FURNISHED: Harold Scherr, Esquire Staff Attorney Florida Real Estate Commission 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 Richard J. R. Parkinson, Esquire 1800 West Colonial Drive Orlando, Florida 32804
Findings Of Fact At all pertinent times, both respondents held real estate broker's licenses. The corporate license is No. 0222663 and the individual license is No. 0159888. The individual respondent has been the only owner of the corporate respondent and the only broker the corporation has ever employed. At one time Angela Lewis worked for Broker Jim, Inc. as a licensed real estate salesperson. On October 6, 1981, it was she who signed, on the broker's behalf, a listing agreement with Laverne Lockhart and Faith Willis, the sisters who jointly owned the house at 1535 NW 116th Street in Miami, Florida (the house) . Petitioner's Exhibit No. 2. Kenneth G. Wilson, who wanted to buy the house, had $5000 available. The house was encumbered with a mortgage in the approximate amount of $33,000 and the sisters eventually agreed to take $44,000 for the property. On the form contract signed by both owners and Mr. Wilson, and dated November 25, 1981, under the heading "Terms and conditions of Sale:", the following was typewritten: 1,000 as mentioned above. Purchaser agrees to make an additional deposit in the amount $4,000 before closing. Purchaser agrees to assume an existing first mortgage in the Approx. amount $33,000, payab[l]e $340.00 P.I.T.I at 10.5 percent per annum in accordance with the terms and conditions set forth therein. Purchaser to obtain a P.M. 2nd mort[g]age in the amount of $6,000 at 18 percent per annum payable Approx. $152.37 for a period of 5 yrs. Balance of purchase price to be paid in cash or cashier check at time of closing. Property being purchased in its present as is condition. Petitioner's Exhibit No. 3. Elsewhere on the printed form appears the following: When this contract is executed by the purchaser and the seller and the sale is not closed due to any default or failure on the part of the purchaser, the seller, at his option, may seek to enforce this contract, or else the seller may direct the holder of the deposit to pay the broker his brokerage fee not to exceed one-half of the deposit and to pay the balance of the deposit to the seller as consideration for execution of this agreement, and the holder of the deposit shall be held harmless by all parties for disbursement in accordance with this agreement. Petitioner's Exhibit No. 3. Ms. Lewis prepared the form contract. Mr. Muhammad, as he is now known, read it over and approved it. In retrospect, he believes this was a mistake, because the contract fails clearly to reflect the parties' understanding that the offer was contingent on Mr. Wilson's ability to borrow $6,000, to be secured by a second mortgage on the house. A deposit ticket dated November 25, 1981, accompanied Mr. Wilson's check for $1000 when respondents deposited it to their escrow account. The bank credited the escrow account on December 1, 1981. Neither Mr. Wilson's efforts to obtain a loan, nor those of respondents on his behalf, availed, and word reached Ms. Lockhart that the transaction was doomed for want of sufficient purchase money. Over the phone, Ms. Lockhart told Helen Jackson, respondents' secretary, that she wanted a "refund" of the deposit. A lawyer Ms. Lockhart consulted communicated a similar demand to respondent Muhammad personally. Respondents gave Ms. Lockhart no money and no accounting. The money stayed in respondents' escrow account until it was used on Mr. Wilson's behalf in the purchase of another house respondents had listed.
Findings Of Fact The Respondent, Joyce Chandler, prior to February 2, 1982, was a real estate salesman employed by Frank Ambrose, a real estate broker. On February 2, 1982, Chandler became licensed as a real estate broker with the State of Florida, and holds license number 0348072. On February 8, 1982, the Respondent drafted an offer to purchase for herself property located at 811 Perrine Avenue in Miami, which belonged to Dr. Harry Moskowitz. The purchase price of the offer was $140,000. The Respondent took the offer to Carol Rebhan, the listing salesman of the property who was employed by Tauber-Manon Red Carpet Realty. The offer provided that an earnest money deposit of $100 would be placed in the escrow account of Roberta Fox, the Respondent's attorney, with an additional $5,000 to be deposited in Roberta Fox's escrow account within three working days of acceptance of the offer. The contract also called for a ten percent brokerage fee to be divided equally between the Respondent and Tauber-non Red Carpet Realty. Carol Rebhan and the Respondent presented the offer to Eugene Lemlich, attorney for the seller Dr. Harry Moskowitz. After contacting Dr. Moskowitz in Texas, Lemlich accepted the offer on his behalf. Three working days after the offer was accepted, Carol Rebhan called Roberta Fox's office repeatedly to determine whether the additional $5,000 deposit had been placed in escrow. Fox's office advised Rebhan that they did not have the $5,000 deposit. Rebhan confronted the Respondent with this information, and the Respondent stated that she was going to deposit the monies with Frank Ambrose at Landmark Title. The next day, Rebhan contacted Landmark Title and was informed that they did not have the deposit in escrow. On or about the 14th of February, 1982, Rebhan contacted Frank Ambrose personally and inquired about the $5,000 deposit. Ambrose told Rebhan that Landmark Title was in possession of the deposit. This was not true. Rebhan requested that Ambrose send her an escrow letter acknowledging possession of the $5,000 deposit. By letter dated February 18, 1982, Ambrose informed Rebhan that Landmark Title was in possession of the $5,000 deposit. On February 18, 1982, the Respondent gave Ambrose a $5,000 check payable to Landmark Title Company. The check was for the additional deposit on the Moskowitz property and was post-dated to February 28, 1982. The check was deposited on February 19, 1982. On February 25, 1982, Ambrose was informed that there were insufficient funds in the Respondent's account to pay the check. Ambrose notified the Respondent that the check had been returned unpaid. She advised him that she was expecting some funds, and would make the check good within a few days. Ambrose took no action to notify the parties at this time. In the first week of March, 1982, when Ambrose had still not received funds from the Respondent to cover the check, he contacted Carol Rebhan and informed her of the series of events which had occurred with regard to the deposit check. When Rebhan subsequently contacted the Respondent and told her that her $5,000 check had bounced, the Respondent seemed shocked at the news. The Respondent has not made good the check returned to Landmark Title Company, nor has she placed the $5,000 deposit in escrow in accordance with the terms of the contract with Dr. Moskowitz. Throughout the entire transaction, the Respondent misled the parties involved with regard to the location and existence of the earnest money deposit, she represented that she would replace the dishonored check or make it-good but has not done so, and she has thereby breached her contract to purchase the subject property from Dr. Moskowitz. The Respondent contends that she informed all parties that the $5,000 check would be post-dated, but there is not sufficient evidence to support this assertion. Nevertheless, the post-dated check given by the Respondent has never been made good, so the Respondent's contention that she advised the parties at the outset that the $5,000 check would be post-dated, is irrelevant.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the license of the Respondent, Joyce A. Chandler, be suspended for a period of one year. THIS RECOMMENDED ORDER ENTERED this 9th day of May, 1983, in Tallahassee, Florida. WILLIAM B. THOMAS Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of May, 1983. COPIES FURNISHED: Tina Hipple, Esquire Post Office Box 1900 Orlando, Florida 32802 Joyce A. Chandler 11231 S.W. 201st Street Miami, Florida 33189 William M. Furlow, Esquire Post Office Box 1900 Orlando, Florida 32802 Harold Huff, Executive Director Florida Real Estate Commission Post Office Box 1900 Orlando, Florida 32802 Frederick Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
The Issue Whether Respondent's real estate broker's license should be disciplined based upon the allegations that Respondent is guilty of fraud, misrepresentation, concealment, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence or breach of trust in a business transaction, in violation of Section 475.25(1)(b) Florida Statutes. Whether Respondent's real estate broker's license should be disciplined based upon the allegation that Respondent is guilty of failure to account and deliver funds, in violation of Section 475.25(1)(d)1., Florida Statutes. Whether Respondent's real estate broker's license should be disciplined based upon the allegation that Respondent is guilty of failure to maintain trust funds in a real estate brokerage escrow bank account or some other proper depository until disbursement thereof was properly authorized, in violation of Section 475.005(1)(k), Florida Statutes.
Findings Of Fact Petitioner is a state government 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 20.165, Florida Statutes, Chapters 120, 455 and 475, Florida Statutes, and the rules promulgated pursuant thereto. Respondent Leslie L. White is now and was at all times material hereto a licensed real estate broker in the State of Florida having been issued license number 0095441 in accordance with Chapter 475, Florida Statutes. The last license issued to the Respondent was as a broker with an address of Les White Realty, 6313 Wynglow Lane, Orlando, Florida, 32818-1311. Respondent's license is currently under suspension for failing to pay a fine and failure to complete certain education courses. On or about September 28, 1993, Respondent negotiated a contract between himself, doing business as Les White Enterprises, as seller, and Charles and Greta White, as buyers, (no apparent relationship to Respondent) to purchase Lot Number 18, Whisper Ridge subdivision in Orange County, Florida and build a house thereon for the total sum of $79,000. Respondent prepared the contract, using the standard Contract for Sale and Purchase form approved by the Florida Association of Realtors and The Florida Bar. Les White Enterprises was listed as the "Seller" and Charles White and Greta White, his wife, were listed as "Buyers". The Buyers agreed to purchase Lot 18 and to have a house constructed on the site by the Seller. The Buyers agreed to seek "new financing at prevailing interest rates" in the amount of $75,550; put down a $2,000 deposit and pay an additional $1,450 at closing. The contract called for the deposit to be held in escrow by Les White Realty/Builders. The $2,000 deposit was paid in cash by the Buyers and given to Respondent. The Respondent did not place the $2,000 deposit in an escrow account contrary to the express terms of the contract. Respondent did not acknowledge receipt of the deposit in his capacity as a broker. At the time the contract was signed, the Buyers knew that the Respondent did not own or have title to Lot 18, and that the purchase price of the lot exceed the amount of the deposit. The Buyers consented to the Respondent using the funds to acquire the property. Respondent was unable to purchase Lot 18, and sought the Buyers' permission to purchase Lot 2 instead and construct a house on it in accordance with the parties' prior agreement. The Buyers reluctantly agreed. On February 18, 1994, Buyers gave Respondent a cashier's check for $1,200 for the purpose of clearing the land and beginning construction of a home for them on Lot 2. The funds were not placed in escrow. The Respondent utilized the funds received from the Buyers and acquired title to Lot 2 in his name alone on or about February 25, 1994. The Respondent cleared Lot 2 in preparation for construction, obtained building plans and applied for building permits in connection with building a house on said lot. Shortly thereafter, Respondent notified the Buyers that the private investors, who approved their loan application, had discontinued financing of the Respondent's construction loan and he was unable to construct the house. The transaction failed to close and the Buyers demanded that Respondent return the earnest money deposit. Respondent was unable to return to return the $3,200 earnest money deposit to the Buyers. Respondent filed for personal reorganization under Chapter 13 of the United States Bankruptcy Code. Throughout the course of this transaction, Buyers dealt with Respondent in his capacity as a broker/builder. In 1994 and 1995, the Florida Real Estate Commission found Respondent guilty of violating the provisions of Section 475.25(1)(b) and (1)(d)1., Florida Statutes on three occasions. Following the third offense, Respondent's license was suspended for six months and it is presently under suspension for failure to pay his administrative fines and complete other requirements of probation.
Recommendation Based on the foregoing, it is RECOMMENDED that the Florida Real Estate Commission issue and file a Final Order finding the Respondent guilty of violating Subsections 475.25(1)(b), (d)1., and (k), Florida Statutes; and guilty of having been found guilty for a second time (or more) of misconduct that warrants suspension, in violation of subsection 475.25.(1)(o), Florida Statutes; it is further RECOMMENDED that Respondent's licensed be revoked. DONE and ENTERED this 4th day of October, 1996, in Tallahassee, Florida. DANIEL M. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 4th day of October, 1996. COPIES FURNISHED: Daniel Villazon, Esquire Department of Business and Professional Regulation Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Frederick H. Wilsen, Esquire Gillis and Wilsen 1415 East Robinson Street, Suite B Orlando, Florida 32801 Lynda L. Goodgame, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Henry M. Solares Division Director Department of Business and Professional Regulation Division of Real Estate Post Office Box 1900 Orlando, Florida 32802
The Issue The issue to be resolved in this proceeding concerns whether the Respondent's Florida real estate license should be subjected to disciplinary sanctions based upon the charge that the Respondent is guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, or breach of trust in a business transaction in violation of Subsection 475.25(1)(b), Florida Statutes.
Findings Of Fact The Petitioner is an agency of the State of Florida charged with licensing and regulating the practice of real estate salespersons and brokers licensed pursuant to the authority of Chapter 475, Florida Statutes, and rules promulgated pursuant thereto. The Petitioner is the state agency charged with the responsibility and duty to prosecute administrative complaints pursuant to Section 20.30, Florida Statutes, Chapters 120, 455 and 475, Florida Statutes, and related rules. The Respondent, Shirlee Jeanette Pearson, is and at all times material hereto, a licensed real estate salesperson, having been issued Florida license number 0389549, pursuant to Chapter 475, Florida Statutes. The last license issued was as a non-active salesperson with a home address of 6124 The Oaks Lane, Pensacola, Florida 32504-7361. On or about December 4, 1989, the Respondent entered into a Listing Agreement with Alexis Reginald Harris and Margaret Harris (hereinafter "Sellers"). The Listing Agreement was executed by the Sellers and the Respondent on behalf of Old South Properties, Inc. The Agreement allowed the Respondent to represent the Sellers in the prospective sale of their property to Michael Jones. Subsequent to showing the property to Mr. Jones, the Respondent presented the Sellers with a Contract for Sale and Purchase dated December 6, 1989. The Contract reflected an earnest money deposit of $500.00 to be held by Old South Properties, Inc. The Contract was dated December 6, 1989 and included a provision whereby Mr. Jones would obtain conventional financing. On or about December 19, 1989, the Contract was amended to allow for veterans administration financing. The Contract was amended on or about January 17, 1990 to provide for a cash sale. Before agreeing to the amendments to the Contract, the Sellers demanded an additional $2,500.00 earnest money deposit. The amended Contract was initialed by the Sellers and taken by the Respondent to the prospective purchaser, Mr. Jones. Mr. Jones initialed the changes, signifying agreement to them. The Contract, as amended, reflected an earnest money deposit in the total amount of $3,000.00 to be held by Old South Properties, Inc. The Contract was thus finalized and the Sellers vacated the property around the first of February, 1990 in anticipation of the closing of sale, which was scheduled for the end of February. The Respondent was aware that the Sellers had moved from the property in expectation of the sale. On or about February 25, 1990, the Respondent told the Sellers that she had never actually received the additional $2,500.00 earnest money deposit called for by the January 17, 1990 amendments to the Contract. This was the first time that the Sellers became aware that the earnest money deposit had not been received by the Respondent. When the Respondent advised them that she had not received the earnest money deposit, as provided for in the Contract, she assured them that the closing would still occur as scheduled on February 28, 1990. On February 28, 1990, the Sellers signed the necessary documents to close the sale and left town. The Respondent told the Sellers that Mr. Jones would sign the papers later on the same day. The Sellers left the keys to the house with their daughter, who would remain in town, upon their departure. The Sellers advised the Respondent that Mr. Jones could obtain the keys from their daughter when the closing documents had all been signed. Subsequent to February 28, 1990, the Sellers' daughter called and advised them that the sale had not closed. The Sellers thereafter retained an attorney, and a civil lawsuit was filed against Old South Properties, Inc. and the Respondent. The court in that case found that the Respondent had breached her fiduciary duty to the Sellers and awarded damages accordingly. Ron Giles ("Giles") was employed as vice president and sales manager of Old South Properties, Inc. at the time the Respondent was employed there as a sales associate. Sometime in February of 1990, the Respondent went to Giles and informed him that she had acknowledged receipt of a $3,000.00 earnest money deposit on the Harris/Jones Contract, but, in fact, had only received $500.00. Giles told the Respondent to immediately contact the Sellers and advise them that the $2,500.00 earnest money deposit had not been received. The Respondent showed Giles a $2,500.00 Promissory Note that she had obtained from Mr. Jones, representing the deposit amount that she had not actually received. Giles went to James Porter, the broker for Old South Properties, Inc., and advised him of the problem with the Harris/Jones Contract. Mr. Porter is now, and was at all times material to the allegations of the Complaint, the President of and the qualifying broker for Old South Properties, Inc. Mr. Porter hired the Respondent as a sales associate for Old South Properties, Inc. sometime in August of 1989. Upon learning of the problem with the Harris/Jones transaction, Mr. Porter had a meeting with the Respondent; and the Respondent admitted to Mr. Porter that she had not informed the Sellers that she had not received the $2,500.00 additional earnest money deposit called for by the amended Contract. When the transaction failed to close, Mr. Porter made efforts to resolve the Sellers' complaint, but was unsuccessful; and the lawsuit ensued. The Sellers were awarded damages by the court, and Mr. Porter paid the Final Judgment entered against Old South Properties, Inc. and the Respondent. The Respondent then agreed to pay Mr. Porter back for the funds he expended in satisfying the judgment; however, the Respondent never actually paid Mr. Porter.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is therefore, recommended that the Respondent be found guilty of having violated Subsection 475.25(1)(b), Florida Statutes, as charged in the Administrative Complaint, by being guilty of culpable negligence, that the Respondent's real estate license be suspended for a period of three (3) years, and that the Respondent be required to pay an administrative fine in the amount of $1,000.00. RECOMMENDED this 1st day of July, 1992, in Tallahassee, Leon County, Florida. P. MICHAEL RUFF 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 1st day of July, 1992. APPENDIX TO RECOMMENDED ORDER, CASE NO. 91-4932 Petitioner's Proposed Findings of Fact 1-28. Accepted. COPIES FURNISHED: Darlene F. Keller, Director DPR-Division of Real Estate P.O. Box 1900 Orlando, FL 32802-1900 Jack L. McRay, Esq. General Counsel Department of Professional Regulation 1940 North Monroe St., Ste. 60 Tallahassee, FL 32399-0792 Janine B. Myrick, Esq. Senior Attorney Department of Professional Regulation Division of Real Estate P.O. Box 1900 Orlando, FL 32802-1900 Ms. Shirlee Jeanette Pearson 6125 The Oaks Lane Pensacola, FL 32504-7361
