The Issue Petitioner's liability for tax, interest, and penalty, pursuant to Chapter 212, Florida Statutes, as set forth in Notice of Assessment, dated December 9, 1975. At the hearing, it was stipulated that the sale by Petitioner to one Norady as set forth in Paragraph B of the Petition was no longer in issue, and accordingly this count was withdrawn by Petitioner. The amount of sales by Petitioner to Triumpho Electric as shown in Paragraph C of the Petition was stipulated to be in the amount of $243,724.34 instead of $248,255.26. In view of the above Stipulations, the Hearing Officer requested that a revised assessment be prepared and submitted after the hearing to reflect the amount now sought by Respondent and to indicate thereon the taxes, penalty aid interest attributable to sales to Ivan Alexander, Triumpho Electric, Grand Bahama Development Company, and Agregados de Cal, purchasers from Petitioner. The revised schedule in the total amount of $12,358.37 was submitted on April 30, 1976, received by the Hearing Officer on May 4, 1976, and is marked as Respondent's Exhibit 1. The parties stipulated at the hearing that the method of computation was correct and Petitioner has filed no objections to the counts of the revised assessment. Accordingly, it is deemed to reflect the amount due and owing if imposition of tax is valid.
Findings Of Fact During the period November 1, 1973 to February 28, 1975, Petitioner made sales of merchandise to the following: Ivan Alexander, Triumpho Electric, Grand Bahama Development Company and Agregados de Cal. the circumstances of each of these transactions are set forth below. Ivan Alexander Construction Co., Ltd. a. Petitioner made sales of electrical equipment in amount of $1,646.50 to Ivan Alexander Construction Co., Ltd. Freeport, Grand Bahamas1 on September 24, 1974. Petitioner delivered e merchandise to Lindsley-RBC, Miami, Florida. Lindsley-RBC was not licensed exporter, but acted in an agency capacity for the purchaser. Subsequent to Petitioner's delivery, Lindsley-RBC consolidated the merchandise with other purchases made by Ivan Alexander, for shipping purposes. After consolidating the merchandise, Lindsley-RBC delivered the merchandise to the shipping vessel, the Tropic Day. It was received by the purchaser in Freeport on October 11, 1974. (Stipulation, Petitioner's Composite Exhibit 7). Triumpho Electric, Inc. Petitioner made sales of electrical construction equipment n the amount of $237,634.57 to Triumpho Electric, Inc., Christiansted, St. Croix, Virgin Islands, during the period under consideration. The procedures used in purchasing, delivering and shipping the merchandise are s follows: Ivan M. Bauknight, an employee of Triumpho, placed the order or the merchandise "on behalf of Triumpho" personally at Petitioner's - place of business, by telephonic communication with a salesman employed by Petitioner, or by contacting its sales representative who took the order in person from Bauknight. In August of 1972, Triumpho had formed Caribbean Supply Company, Inc., a wholly-owned subsidiary, for purposes of purchasing merchandise, consolidating said merchandise in its own warehouse, and shipping. To further effectuate their purposes, warehouse pace was secured at Miami International Airport. Although Bauknight as in charge of Caribbean Supply Company, Inc., he was not an employee of that company. In fact, Caribbean Supply Company, Inc., had no employees during the period in question, excepting casual labor at intervals who were supervised by Mr. Bauknight. Although it was not a "licensed exporter", Caribbean possessed an export sales tax number issued by Respondent. Subsequent to the placing of orders in the above-described manner, Petitioner delivered the merchandise to Caribbean Supply Company, Inc.'s warehouse located at Miami International Airport where the merchandise was consolidated with other purchases. After delivery, and after packaging and consolidating the merchandise in Caribbean Supply Company, Inc.'s warehouse, Bauknight contacted a shipping company and requested that a "piggyback" trailer be provided on which to load the merchandise. The shipping company then placed the trailer upon Caribbean Supply Company, Inc.`s loading lock where Bauknight and laborers would load the merchandise onto the trailer, seal it, and then inform the shipping company which would take it to Dodge Island Seaport, Miami, Florida, and load it upon a ship. During the assessment period in question, all trailers were loaded at Caribbean Supply Company, Inc. Another method of transportation was shipment by air from Miami International Airport. In such cases, the merchandise was delivered by Petitioners to Caribbean's warehouse where it was packaged and taken to commercial airlines for shipment. (Testimony of Bauknight, Petitioner's Composite Exhibits 1-4). Grand Bahama Development Company, Ltd. Petitioner made sales of merchandise in the amount of $21,407.55 to Grand Bahama Development Company, Ltd., during the period in question. Procedures used in purchasing, delivering and shipping were as follow: America Devco, Inc., Miami, Florida, a wholly-owned company of Grand Bahama Development Company, Ltd., was created by the latter to represent its interests in the United States. At all times pertinent to the instant transactions, America Devco, Inc., was not a licensed exporter but was acting as Grand Bahama Development Company, Ltd's agent. It did, however, possess an export sales tax number issued by Respondent. America Devco, Inc., contacted Petitioner's sales representative by telephone and placed orders subsequently issuing a confirming purchase order to Petitioner. In about 60 percent of the transactions, Petitioner delivered the merchandise to America Devco, Inc.'s warehouse. In about 40 percent of the transactions, America Devco, Inc., went to Petitioner's business site, picked up the merchandise and took it to its warehouse. By both methods, the merchandise usually remained at America Devco, Doc's warehouse from one to three days in order to create shipping documents or to take advantage of the hundred pounds air shipping minimum. America Devco, Inc., utilized its trucks to deliver the merchandise to the airline cargo loading platform. All supplies were kept in the original containers supplied by Petitioner and America Devco, Inc., only affixed shipping label. Shipping documents were prepared by the shipping company. In one transaction, Petitioner delivered purchased merchandise to Alco Shipping Company at the dock in Port Laudania, Florida. (Testimony of Gomez, Petitioner's Composite Exhibit 5). Agregados de Cal. Petitioner made sales of merchandise in the amount of 905.90 to Agregados de Cal during the period in question. The merchandise was delivered by Petitioner to Mr. Robert de la-Puirtilla, in employee or representative of Agregados de Cal, at Petitioner's lace of business, at which time he took possession of the merchandise nd delivered it to the airport. (Stipulation, Petitioner's Composite Exhibit 6).
Recommendation That the tax assessment of $12,358.37 against Petitioner under the provisions of Section 212.05, F.S., including interest and penalties be imposed by the Department of Revenue and enforcement thereof be effected in accordance with the provisions of law. DONE and ENTERED this 12th day of July, 1976, in Tallahassee, Florida. THOMAS C. OLDHAM Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Patricia S. Turner Assistant Attorney General Department of Legal Affairs The Capitol Tallahassee, Florida 32304 George A. Buchmann Penthouse B2 7000 S.W. 62 Avenue South Miami, Florida 33143 Attorney for Petitioner
Findings Of Fact Stipulated Facts The following facts, 1-36, are taken as established by stipulation of the parties in their Prehearing Stipulation filed April 7, 1987. Southland presently holds and held, on the date of issuance of the Notice to Show Cause issued in this case, 704 non-temporary Florida alcoholic beverage license. On or about September 13, 1983, Eugene DeFalco, then a Southland employee, pled guilty to conspiring to bride an official of the New York State Tax Commission in violation of 18 U.S.C. Section 371. On or about September 27, 1983, Southland terminated its employment relationship with DeFalco. In 1977 and 1978, Eugene DeFalco was the manager of all 7-Eleven Stores in Southland's Northeast Division. DeFalco, Eugene Mastropiere, who in 1977 was a practicing attorney in New York City and a New York City Councilman, and John Kelly, a corporate security consultant, agreed that Mastropiere would submit a fictitious legal bill to Southland for $96,500. After receiving Mastropiere's bill, Southland issued a check in that amount payable to Mastropiere. Upon receipt of the check, Mastropiere turned over the proceeds of that check to Kelly and DeFalco. DeFalco and Kelly undertook those actions to facilitate their misappropriation of Southland funds. DeFalco and Kelly did ultimately misappropriate the entire $96,500 for their personal use. DeFalco was aware that Southland would deduct the $96,000 as a business expense and issue Mastropiere an IRS Form 1099, thereby concealing from the Internal Revenue Service and others DeFalco's and Kelly's conversion of the money. On or about June 8, 1984, a jury convicted Southland of conspiring to defraud the Internal Revenue Service. On or about June 11, 1984, the same jury was unable to reach a verdict as to Dole, and the judge declared a mistrial. On August 2, 1984, the judge entered a Judgment and Conviction Order, convicting Southland of conspiring to defraud the Internal Revenue Service in violation of 18 U.S.C. Section 3371, a felony under the laws of the United States. On or about December 28, 1984, Southland paid the $10,000 fine imposed by a federal district court judge in the Eastern District of New York on the basis of that conviction. Southland's August 2, 1984 conviction was upheld by a three-judge panel of the United States Court of Appeals, Second Circuit, on April 23, 1985, United States vs. Southland Corp., 760 F.2d 1366 (1985), which determined that the trial record contained sufficient evidence to support the jury's verdict. On or about February 27, 1985, a jury acquitted S. Richmond Dole of conspiring (1) to bribe an official of the New York Tax Commission and (2) to defraud the Internal Revenue Service in violation of 18 U.S.C. Section 371. On or about February 27, 1985, a jury acquitted Clark J. Matthews, II, then Executive Vice President and Chief Financial Officer of Southland, of conspiring (1) to bribe an official of the New York Tax Commission and (2) to defraud the Internal Revenue Service in violation of 18 U.S.C. Section 371. On or about January 27, 1985, a jury convicted Clark J. Matthews, II, of violating the federal securities laws, 15 U.S.C. Section 78n(a), but on March 27, 1986, a unanimous panel of the United States court of Appeals for the Second Circuit reversed his conviction and ordered the indictment dismissed. At the conclusion of the second trial, United States vs. Dole and Matthews, CR 84-00461 (E.D.N.Y. 1985), the trial judge instructed the jury that it could not, as a matter of law, consider Southland employees John Thompson, Michael Davis, Frank Kitchen, or Eugene Pender as members of any conspiracy. Eugene DeFalco directly contributed to Southland's 1984 conviction in the United States District Court for the Eastern District of New York. For the purposes of this proceeding, the Division takes the position that Clark J. Matthews, II, and S. Richmond Dole are the only present employees of Southland that directly contributed to Southland's conviction in United States vs. Southland, et al., 83-CR-515 (E.D.N.Y.) On or about February 15, 1977, S. Richmond Dole and Eugene DeFalco discussed hiring Eugene Mastropiere as outside counsel on certain New York sales tax cases and at that time, discussed charging Masterpiere's fee to a corporate account in Dallas rather than directly to the Northeast Division. Later that night, on February 15, 1977, Dole, DeFalco, Frank Kitchen and John Thompson met informally and discussed, among other matters, the Northeast Division and its progress. At this meeting, they discussed DeFalco's proposal to have Eugene Masteropiere as outside counsel on the New York sales tax cases. Following this meeting, on February 15, 1977, Dole and Kitchen discussed the proposed retention of Eugene Mastropiere, and Dole told Kitchen not to worry about the sales tax cases--that Eugene DeFalco would handle them. United States of America vs. S. Richmond Dole & Ano., 84 CR 00461 (E.D.N.Y.), tr. at 2493-94. In correspondence from S. Richmond Dole to Eugene DeFalco dated February 23, 1977, Dole stated, "Be sure to send me the bill on the sales tax case so that I can see that it's paid from the corporate office. Hopefully, it will hit one of Clark's legal accrual accounts." In or about May 1977, Eugene DeFalco asked S. Richmond Dole whether Mastropiere's legal fee could be submitted and paid in the form of an airplane lease. United States of America vs. S. Richmond Dole and Ano., 84 CR 00461 (E.D.N.Y.), tr. at 2493-94. Matthews also told DeFalco that Southland would only pay a bill for legal services as a bill for legal services. At some point in time in mid-1977, S. Richmond Dole asked Eugene Pender, Southland's Controller, who was responsible for accounting and payroll, to process the Mastropiere legal fee. United States vs. S. Richmond Dole and Clark Matthews, 84 CR 00461 (E.D.N.Y.), tr. at 2493-94. The legal bill for $96,500 submitted to Southland by Mastropiere indicates services rendered from October, 1976 to May, 1977. Southland's normal procedure for payment of outside legal fees requires approval from the General Counsel's Office. On or a about June, 1977, management of The Southland Corporation undertook a Business Ethics Review. Clark J. Matthews, II, then Vice President and General Counsel for Southland, was in charge of that review under the supervision of the Audit Committee of the Southland Board of Directors. When Matthews learned of the size of the Mastropiere legal fee he recalled the airplane lease suggestion and directed Michael Davis, the staff attorney assisting him, to add the Mastropiere fee to the list of items to be investigated in the Business Ethics Review. The handwriting notes that Clark Matthews prepared prior to the meeting at which the Board of Directors was briefed on the Mastropiere matter contain the words "NY-Mastropiere Div. Mg. Thought Payment Outside Usual Controls" and "for $40M to spread among moms tax comm." In 1978, prior to the filing of Southland's 1977 federal income tax return, Matthews and Davis discussed with Stanley Simon, Southland's outside tax counsel, whether the Mastropiere fee was a deductible expense for purposes of Southland's tax return. No written discussion of the Mastropiere legal fee was contained in the final written report prepared at the conclusion of the Business Ethics Review. Gate Petroleum, Inc., Eastern Oil Co. and Cargo Gasoline Co. were convicted in May 1980 of violations of Section 1 of the Sherman Annatitrust Act, 15 U.S.C. Section 1. As a result of these convictions, Gate Petroleum, Inc., paid a civil penalty of $100.00 for each license held (total of $2100.00); Eastern Oil Co. and Cargo Gasoline Co. each paid a civil penalty of $500 per license. The Division and Southland stipulate that Responses Nos. 1 and 2 to Petitioner's First Set of Interrogatories accurately set forth the actions taken by state licensing agencies with respect to Southland's licenses based on Southland's federal conviction in New York. The following additional facts, 37-172, are based upon the record herein. The Sales Tax Cases What has come to be known as the "New York sales tax cases" began in 1972 when New York asserted a sales tax deficiency against one of Southland's franchise 7-Eleven stores. In the next few years, additional deficiency notices were issued. By 1977, New York State contended that Southland owed between $150,000 and $300,000. The New York State Tax Commission asserted that unless Southland gave the state sufficient notice when it terminated a franchise, the Tax Commission could audit that store and hold Southland secondarily liable for any sales tax deficiencies discovered. Southland believed it had a meritorious defense based on a specific exemption provided that there was no transferee liability upon the foreclosure of security interest, and Southland's franchise agreement gave it such an interest in the inventory and assets of the franchises in question. In 1976 and 1977, S. Richmond Dole was Southland's Vice President in charge of franchise stores. He is presently Executive Vice President in charge of 7-Eleven stores. In 1977, Clark J. Matthews, II, was Vice President and General Counsel of Southland. He is today Senior Executive Vice President and Chief Financial Officer. In 1977, John P. Thompson was Chairman of the Board of Southland and its Chief Executive Officer. He today holds the position of Chairman of the Board. In 1977, Frank Kitchen was Regional Manager of the Northeast Region. He is today a Regional Vice President at Southland. The Retention of Mastropiere In 1976, S. Richmond Dole and Eugene DeFalco discussed the New York sales tax cases. In the course of this discussion, DeFalco expressed to Dole his dissatisfaction with the performance of Thomas Dougherty, the outside counsel that Southland had hired to handle the New York sales tax cases. DeFalco stated in substance that he felt that another attorney should be hired since the cases were not moving and additional assessments by New York continued to be made. At the end of 1976 or the beginning of 1977, Dole called Clark J. Matthews, II, and told him that DeFalco was dissatisfied with the progress of the sales tax cases. Dole stated that DeFalco would be giving Matthews a call. DeFalco subsequently called Matthews to discuss the New York sales tax cases. DeFalco stated that he was dissatisfied with Dougherty, Southland's local counsel, because the New York sales tax cases were not moving forward. DeFalco told Matthews that John Kelly, a Southland supplier, had recommended that Eugene Mastropiere be retained to help Southland in the sales tax cases. DeFalco asked Matthews if it would be all right to retain Mastropiere. Matthews told DeFalco that he would check on Masterpiere and get back to him. Matthews reviewed Mastropiere's listing in Martindale Hubbell, and then called Southland's local counsel, Thomas Dougherty, for additional information. Dougherty called Matthews back later and told him that, as far as he could ascertain, Mastropiere was a reputable attorney. Matthews then called DeFalco and told him that he could engage Mastropiere as counsel, but that Matthews wanted Dougherty retained as co- counsel. Matthews also told DeFalco to ascertain what the fee arrangement would be. DeFalco later called Matthews and told him that Mastropiere would require a retainer of $30,000 - $40,000. On or about February 15, 1977, at a Northeast Division sales meeting in Hartford, Connecticut, Dole and DeFalco met in the lobby or coffee shop of the hotel at which the sales meeting was being held. DeFalco told Dole that he wanted to hire Mastropiere as outside counsel on the New York sales tax cases. During the conversation in the hotel lobby, DeFalco again stated that he was not satisfied with Dougherty's handling of the sales tax cases and that the cases were not moving fast enough. DeFalco expressed concern that a negative decision in New York might set a precedent in other states. He stated that he had found a number of stores were undercollecting their taxes and he feared that, because of these stores and the possibility of a bad precedent, Southland faced a potential liability of over one million dollars. DeFalco proposed to Dole the retention of Mastropiere as an attorney in the sales tax cases. He stated that, based on his conversations with Mastropiere and their review of the files, Mastropiere could be helpful to Southland. DeFalco also mentioned to Dole that Mastropiere was a New York City Councilman and a practicing attorney. Dole questioned whether there might be a possible conflict of interest, but DeFalco indicated that there was no conflict since the sales tax cases were disputes with the state and Mastropiere's responsibilities as Councilman involved the city. DeFalco told Dole that there would be an unusual fee arrangement--a one-time payment of $90-100,000, to include appeals. DeFalco never said anything to Dole about a bride or improper payment. DeFalco also proposed charging Mastropiere's fee to a corporate legal accrual account in Dallas rather than directly to the Northeast Division. By charging the fee to a corporate legal accrual account, the expense would not be considered part of the operating expenses of DeFalco's division and thus would not reduce the bonus paid to him and others in the division. Later that night, on February 15, 1977, Dole, DeFalco, Frank Kitchen and John P. Thompson met informally and discussed, among other matters, the Northeast Division and its progress, including the sales tax cases. Such informal gatherings between senior executives from Dallas and field personnel are common at Southland's periodic sales meetings. At that meeting, DeFalco stated that the cases were not moving along and that he had recommended hiring another attorney, by the name of Eugene Mastropiere, who was both a practicing attorney and a City Councilman in New York. DeFalco noted that Mastropiere might be expensive. Thompson replied that all lawyers are expensive, that DeFalco should be sure to get a good one, but that if DeFalco and others thought it was a good idea to hire this man, they should do so. Thompson also told DeFalco to check with Matthews, who ran Southland's Legal Department, about hiring Mastropiere. No mention of a bribe or payoff was made at the meeting. The term "entertainment" may have been used, but if it was used, it did not signify to those present that a bribe was to be paid. Immediately following his meeting, on February 15, 1977, Kitchen expressed concern to Dole about the proposed retention of Mastropiere and asked Dole whether they had just agreed to give $100,000 to a politician, i.e., to Mastropiere. Dole said no and told Kitchen not to worry about the sales tax cases, because DeFalco was fully familiar with these cases, and Kitchen was new to his position and had other priorities to worry about in the region. Following the Hartford meeting, Dole spoke to Matthews about DeFalco's desire to hire Mastropiere. Matthews stated that he had already spoken to DeFalco and that Mastropiere had been retained as co-counsel. Following this meeting, Dole confirmed in a letter to DeFalco that he would attempt to have the bill charged to the corporate legal accrual account. Payment of Mastropiere In or about May 1977, Dole received a phone call from DeFalco, in which DeFalco stated that he had talked with Mastropiere who had suggested that Southland could reduce Mastropiere's bill by 50 percent if it paid him in cash. Dole rejected this proposal. In that conversation or a subsequent conversation, DeFalco asked Dole whether Mastropiere's legal fee could be submitted and paid in the form of an airplane lease. When Dole asked about these unusual payment proposals, DeFalco explained that Mastropiere was having problems with his law partner. Dole told DeFalco that he wanted no part of Mastropiere's partner problems and that DeFalco should send Mastropiere's legal bill to Dole right away. Dole also told DeFalco to tell Matthews about Mastropiere's proposal. DeFalco later called Matthews and told him of the proposal that Mastropiere's fee be paid in the form of an airplane lease. Matthews rejected the suggestion and told DeFalco that Southland would only pay a bill for legal services as a bill for legal services. Because of his concerns about the airplane lease proposal, Matthews arranged to talk to Mr. Dougherty about Mastropiere on a trip to New York in June 1977. When Matthews asked Dougherty in New York about Mastropiere's participation in the sales tax cases, Dougherty indicated that Mastropiere was involved and performing substantive work on the cases. Matthews told Dougherty of the airplane lease proposal. Dougherty acknowledge that the request was peculiar, but added that he had practiced before the Tax Commission for a long time and knew the individual Commissioners to be reputable people. Dougherty assured Matthews that there was nothing improper going on with the Tax Commission. In or about June 1977, DeFalco called Dole to tell him that the bill was in the mail and that he would appreciate it if Dole would expedite the payment for the bill and ensure that it was charged to a corporate account DeFalco also requested that the check be sent to him personally so that he could hand-deliver it to Mastropiere. In the past, other division manager had asked Dole to allow them to deliver a check personally, for various reasons, and Dole saw nothing improper in DeFalco's request. After receiving the bill, Dole took it to Eugene Pender, Southland's Controller, who was responsible for accounting and payroll. Dole told Pender that he had a bill from the attorney working on the sales tax cases in New York. Dole stated that Pender might recall this attorney because the attorney had suggested that his bill be paid in cash or in some form of an airplane lease. Dole indicated that he wanted the bill paid and charged against the corporate legal accrual account. Pender noted that it was a Division expense and should be charged to the Division, but Dole stated that he had promised DeFalco that the bill would be charged to the corporate legal accrual account and that if Pender had any questions he should check with the Legal Department. Dole also told Pender to send the check directly to DeFalco so that DeFalco could hand-deliver it to the attorney. In 1977, it was not unusual for Pender to be asked to expedite the payment of a bill. Although Southland's normal procedure for payment of outside legal fees requires approval from the General Counsel's office, it was not unusual for the Controller to process a legal or other bill based on the oral authorization of a senior executive such as Dole. Dole did not suggest anything improper to Pender. Pender would not have processed the Mastropiere fee if he had felt that the bill was improper. Upon receipt of the check, Mastropiere turned over the proceeds of that check to Kelly and DeFalco. DeFalco and Kelly ultimately misappropriated the entire $96,500 for their personal use. Business Ethics Review Investigation In or about June 1977, Southland's management undertook a Business Ethics Review (BER). Clark J. Matthews, II, then Vice President and General Counsel, was in charge of that review under the supervision of the Audit Committee of the Board of Directors. Michael Davis, then a staff attorney at the Legal Department, handled most of the day-to-day work on the BER. In conducting the investigation, Matthews, Davis and the Audit Committee relied on the advice of an outside attorney, John Fedders. Fedders helped draft the BER questionnaire, consulted with Matthews and Davis concerning responses and follow-up strategy, helped prepare the presentation of these findings to the Audit Committee (a committee comprised of outside directors) and assisted in the drafting of the final written BER report. In or about July 1977, Southland distributed BER questionnaires to over 300 employees to elicit information on possibly questionable payments. Independent of the BER, in August 1977, Matthews learned that the size of the Mastropiere fee was $96,500 rather than the $30-$40,000 that he expected. The size of the fee and the earlier airplane lease suggestion led Matthews to direct Michael Davis to add the mastropiere fee to a list of items to be investigated in the Business Ethics Review. When the BER questionnaires were returned in August or September 1977, Davis prepared a summary of the positive responses, i.e., those responses that reported information which might require further investigation. In his response to the BER questionnaire, Pender denied any direct knowledge of improprieties, but raised questions about a legal fee in the Northeast Division. Pender cannot recall today what led him to mention the legal fee on his questionnaire, but he is certain that he was not suggesting that the fee might include a payoff or bribe. Davis interviewed Pender about his BER questionnaire response but Pender could provide no information beyond what was contained in his questionnaire. On September 22, 1977, Davis Fedders, and Matthews met to review the summary and to determine how to proceed with the BER investigation. At the September 22, 1977 meeting, Davis, Fedders and Matthews discussed the Mastropiere fee and the Pender questionnaire response, and prepared a list of people to be interviewed, which included DeFalco and Kitchen. On or about September 27, 1977, Matthews and Davis reported to the Audit Committee on the status of the BER investigation, including the investigation of the Mastropiere fee. As part of their investigation, on October 17 or 18, 1977, Matthews and Davis interviewed Eugene DeFalco about the Mastropiere fee. This interview took place in DeFalco's room at a Dallas hotel, where he was staying while in Dallas for a meeting. Matthews and Davis drove to the hotel in separate cars and met DeFalco at the hotel. In the interview, DeFalco provided some background information concerning the retention of Mastropiere, including the involvement of John Kelly in DeFalco's negotiations with Mastropiere over his fee. However, DeFalco did not tell Matthews and Davis that he and Kelly had begun to embezzle the funds, and he never suggested that any part of the fee was intended as a pay-off or bribe. DeFalco did not try to prevent Matthews or Davis from interviewing Matropiere. After the interview, Matthews and Davis walked to their cars together. DeFalco remained in his room and did not speak separately with Matthews. DeFalco did not advise Matthews in a parking lot conversation or on the way to the car of any alleged bribe conspiracy or that any improper payment had been made. The next day, Davis interviewed Frank Kitchen. Kitchen told Davis that he surmised that a payoff had been discussed at the Hartford meeting with Thompson, DeFalco and Dole. When pressed by Davis for more information, Kitchen listed four factors that led him to this conclusion: (a) the name Mastropiere was Italian; (b) the cases involved a New York state agency; (c) the attorney was said to be "expensive", and (d) entertainment was mentioned. Kitchen could provide no more specific information and cannot recall the details of that conversation today. Davis thereupon recommended that Kitchen amend his BER questionnaire, which Kitchen eventually did. Based on the results of this interview, Davis Fedders and Matthews decided that Thompson and Dole--the other two persons present at the Hartford meeting--should be interviewed. Matthews subsequently interviewed Dole and Thompson; both denied that any payoff or bribe had been discussed at Hartford. In December 1977, Matthews and Davis again reported to the Audit Committee the status of the Mastropiere investigation, including that there had been a suggestion that the Mastropiere fee be paid as an airplane lease, that the actual fee was substantially greater than Matthews had anticipated, that Kelly had been involved in the alternative payment suggestions, that Kitchen had indicated in an amendment to his questionnaire responses that he felt that at a meeting in Hartford a payoff had been discussed, and that Thompson, Dole and DeFalco all had denied any such conversation. During December, 1977, and January, 1978, Matthews consulted with the Audit Committee and with Fedders and one of his law partners, Bud Vioth, as to how to proceed with the investigation of the Mastropiere fee. It was agreed that Matthews should interview Mastropiere. Matthews' meeting with Mastropiere was arranged for late afternoon, January 9, 1978, in New York. Because of a snowstorm, Mastropiere never showed up for the meeting. Matthews and Mastropiere later talked by telephone. During their telephone conversation, Mastropiere demonstrated knowledge of the cases and was conversant with the theory of Southland's defense. Matthews questioned Mastropiere about his legal fee. Matthews asked if Mastropiere received the entire fee, to which Mastropiere responded yes. Matthews asked if any of the money had been paid or was intended to be paid to anybody else, to which Mastropiere responded no. Matthews followed the interview protocol that Fedders had recommended. On or about January 12, 1978, the Audit Committee held another meeting at which Matthews shared the details of the Mastropiere conversation with Fedders and his law partner, Vieth, and with the Audit Committee. At this meeting, the Audit Committee also interviewed Dole about the Mastropiere fee. After the Mastropiere and Dole interviews, the Audit Committee, Fedders, Vieth, and Matthews and Davis reviewed the evidence and concluded that they had no proof that there had been a bride or any improper use of the money. In making this determination, they took into consideration that New York was continuing to file sales tax cases and that there had been no unusual activity in the course of that litigation or its pace. Because there was no evidence of any impropriety and because of the possibility of libel, it was agreed that the matter would not be discussed in the final written BER report. It was also agreed that a detailed oral report on the matter would be made to the Board of Directors. On or about January 25, 1978, Matthews made an oral report to the Southland Board of Directors on the finding of the BER, including the investigation of the Masteropiere fee. At the conclusion of the BER investigation, Southland's Board of Directors adopted a "Code of Business Conduct," which it now requires all employes to follow. The Legal Department's investigation of the Mastropiere fee was a good faith effort to determine whether there was any impropriety connected with the retention and payment of Mastropiere. Matthews and Davis completely and accurately disclosed to outside counsel, the Audit Committee and the Board of Directors the steps taken to investigate the Mastropiere fee and the results of that investigation. In fact, according to one Audit Committee member, Matthews was the motivating force behind the Mastropiere investigation and brought it to the Audit Committee's attention on a number of occasions. DeFalco engaged in a conspiracy with Kelly and Mastropiere to misappropriate $96,500 from Southland. DeFalco was aware that Southland would deduct the $96,500 as a business expense on its federal corporate income tax return and issue Mastropiere an IRS Form 1099, thereby concealing from the Internal Revenue Service and others DeFalco's and Kelly's intended use of that money. Neither Dole nor Matthews knew of any facts that would require them to prevent the deduction of the Mastropiere fee on Southland's 1977 income tax. Neither Matthews nor Dole had an any involvement in the preparation of filing of Southland's 1977 federal income tax return or in the deduction of the paid to Eugene Mastropiere. In December 1977 and January 1978, Matthews discussed with Stanley C. Simon, Southland's outside tax counsel, a number of issues arising out of the BER investigation, including the Mastropiere fee. Simon stated that Southland should deduct the fee unless it had proof of a bribe or of any other improper use of the money. Based on this advise, Matthews and Davis determined that no action need be taken with respect to the deduction of the Mastropiere fee. Inasmuch as DeFalco embezzled the entire sum, the Mastropiere fee deduction by Southland was in any event properly deductible as a theft loss. The IRS has never challenged Southland's deduction of the Mastropiere fee. In connection with an IRS audit of Southland's 1974 and 1975 tax returns, Southland volunteered to the IRS that it had conducted a Business Ethics Review and it made available to the IRS all of the questionnaires requested. Davis' secretary was told by Davis to make the BER questionnaires available to the IRS and personally saw the IRS take the boxes of questionnaires to their work area, but the IRS agent does not recall seeing the Kitchen questionnaire. He concedes that he does not recall seeing other questionnaires that his records indicate that he did in fact review. DeFalco's Credibility Eugene DeFalco was the only witness in either the Southland trial or the Dole and Matthews trial who testified that there was a conspiracy to bribe a New York State tax official or to defraud the Internal Revenue Service, or that Matthews and Dole were knowledgeable of or participated in any conspiracy. Even DeFalco's confederate, John Kelly, who testified with immunity, while admitting participating in DeFalco's scheme to defraud Southland, denied that he was a party to or aware of a conspiracy to bribe an official of the New York Tax Commission. The record of these proceedings shows that DeFalco has lied repeatedly to serve his own interests. DeFalco admitted in the Southland and Dole and Matthews trials that he was both a liar and a thief. DeFalco admitted that he lied to the FBI in 1980 by telling them that he had a B.S. in marketing from the University of San Diego and that he had attended one semester of law school--when he had not. DeFalco admitted at trial that he stole Southland's money, and that he lied to the FBI in July 1980 on how he spent the money, falsely stating that a substantial part of the fee ($18,000 - $20,000) went for business expenses. DeFalco admitted lying on various occasions to federal government officials. DeFalco told the FBI that no portion of the Mastropiere fee money went to his then future wife, Kathy Burton. Later he admitted at trial that this was not true. DeFalco repeatedly lied to Southland about his use of the money. Prior to pleading guilty, DeFalco denied that there was any conspiracy to bribe and denied that he had embezzled any of Southland's funds. Upon pleading guilty, DeFalco changed his story. On a loan application to the Union Trust Company in April 1979, DeFalco listed as assets certain WD-40 stock wit the value of $150,000. DeFalco admitted at trial that this was a lie, that his largest holding was $6,000 - $8,000. On the same application, DeFalco claimed to have an interest of over $100,000 in a trust called Falcon Investment Trust, even though he admitted at trial that he had no present interest in the trust. On a loan application to the Southern Ocean State Bank in June 1979, DeFalco claimed to have an interest in the Falcon Investment Trust of $1.5 million, even though he had no present interest in the trust. He also claimed to have $81,000 worth of WD-40 stock, which he admitted at trial was a lie. DeFalco perjured himself even after pleading guilty in September 1983. In November 1983, two months after pleading guilty to a felony and while awaiting sentencing, DeFalco lied on a California residential loan application. He listed a company called "Coast-to-Coast" as his employer for the preceding three years at an annual income of $140,000, even though Coast-to-Coast was not yet generating any income. On the same application, DeFalco listed as assets 1,371 shares of Southland stock at a value of $54,840, even though DeFalco had sold these shares in September 1983. DeFalco admitted that he lied throughout his career at Southland, including falsely claiming on his personnel form in 1969-70 that he had a B.S. in marketing. DeFalco admitted that he lied to get ahead in the corporation. DeFalco even admitted lying under oath at the Southland trial. He claimed in that trial that the false statements on the California residential loan application were mistakes made by the person who typed the application. When confronted with an earlier handwritten version containing the same statements, he admitted that the statements were his. DeFalco's lies are so numerous and pervasive as to render all of this testimony unbelievable. His testimony is rejected as lacking in credibility and as self-serving. DeFalco's Direct Contribution to Southland's Conviction In 1983, DeFalco was indicted and charged with one felony count of conspiracy to bribe an official of the New York State Tax Commission in violation of 18 U.S.C. Section 371 and three felony counts relating to his misappropriation of Southland's funds. On or about September 13, 1983, Eugene DeFalco who was then on administrative leave from Southland, pleaded guilty to the conspiracy charge. In return for pleading guilty, the government agreed to dismiss the three counts of fraud pending against him relating to his misappropriation of $96,500 from Southland. As a result, DeFalco's potential prison sentence was reduced from 20 years to 5 years. Up until the time he pleaded guilty, DeFalco denied the existence of any conspiracy to bribe. Up until the time he pleaded guilty, DeFalco denied that he had embezzled any of Southland's money. After pleading guilty, DeFalco testified at both Southland's trial and the trial of Dole and Matthews that one objective of his agreement with Kelly and Mastropiere was bribery, and that ultimately he and Kelly embezzled from Southland all of the $96,500 fee. Eugene DeFalco directly contributed to Southland's 1984 conviction in the United States District Court for the Eastern District of New York. At Southland's trial, the jury was instructed that a "corporation is liable for the acts of its agents within the scope of his employment as long as the agent acted in substantial part and [sic] with the specific intent of benefiting the corporation." The jury was also instructed that if DeFalco had that intent "[i]t does not matter that [he] . . . may have also had another purpose in mind which may have involved personal gain for himself. Mitigation Southland's conviction in 1984 is the first and only felony conviction against Southland in the 53 years the company has been in business. The DABT offered no evidence to suggest that Southland's conviction for conspiring to defraud the IRS was anything more than an isolated incident or that it cast doubt on Southland's qualifications to hold beer and wine licenses in Florida. Southland holds beer and wine licenses in 39 states. No other state has revoked Southland's alcoholic beverage licenses based on this conviction, and approximately 29 of the 39 states in which Southland holds licenses took no action whatsoever. The record in this proceeding establishes that Southland has been a good corporate citizen both nationally and in the State of Florida. In the past 11 years, Southland has raised millions of dollars for the Muscular Dystrophy Association, contributing up to a million dollars each year in advertising alone for the Association's fund raising campaign. Southland was the March of Dimes first corporate sponsor and remains its leading sponsor today. Southland strongly encourages its employees to participate in the March of Dimes "Walk America" and has developed a manual for its employees on how they can best promote the March of Dimes effort. Southland was a major corporate sponsor of the Olympic Games in Los Angeles in 1984 and of the United States Olympic Committee. Southland funded the construction of the $3,000,000 7-Eleven Velodrome in Los Angeles for the Olympic Cycling events and also built a similar Velodrome for the Olympic committee at the Olympic Training Center in Colorado Springs, Colorado. Prior to the Olympics, Southland created and funded the Olympia Awards, awards given by a panel of past Olympic competitors to young athletes. This program continues today. Beginning in August 1974, Southland co-sponsored the Save a Living Thing project with the National Wildlife Federation. The project was designed to generate funds for the purchase of nesting grounds for the American Bald Eagle. As a result of the Save a Living Thing project, Southland raised two hundred thousand dollars for the National Wildlife Association, and, with that, purchased 1,123 acres of eagle nesting grounds. Southland and the National Wildlife Federation transferred the deed to the property to the Department of the Interior, which now maintains the refuge as part of the National Parks System. Southland is active in efforts to reduce crime and has hired an ex- convict to conduct seminars and clinics on how best to deter robberies. Southland has signed an agreement with two minority organizations, Operations PUSH and LULAC, committing Southland to seek a greater representation of minorities in its corporate and franchise operations. Southland sponsors at a local level in Florida many of the organizations it helps nationally. In addition, it sponsors organizations and events indigenous to Florida. Southland has developed and underwirtten child abuse prevention programs in New York, Texas, and Florida. The Florida program, called "Child Abuse, It's A Crying Shame," was launched in January 1986 by Governor Graham. As part of this program, all Florid 7-Eleven stores made available, at no charge the public, Child Abuse Awareness and Prevention bumper stickers supporting the 1-800-FLA-LOVE telephone number--a hotline number for those who need help or who want information concerning child abuse. Southland also paid for the creation of similar placards for buses. Since 1984, Southland has sponsored Florida's Sunshine State Games, encouraging people from across the state to compete in the amateur Olympic-type events. In 1981, Southland established the Come of Age Program and became the first retailer in the country to initiate an in-house employee training program to prevent the sale of alcoholic beverages to minors. This program continues today. Southland has received numerous letters from public officials and law enforcement officers in Florida and elsewhere praising the Come of Age Program and its efforts to prevent the sale of alcoholic beverages to minors. In addition, Southland sponsors various community programs designed to combat drug and alcohol abuse among minors. In 1985, Southland developed an educational packet on drug and alcoholic abuse, which it has now sent to 40,000 junior high schools across the country. Southland also sponsors a program called Operation Prom/Graduation, designed to encourage alcoholic-free events for minors, and has developed and sent to communities across the country a manual on how to sponsor such events." DABT'S Policy DABT has never previously revoked or suspended a corporation's license when the corporation was convicted of a felony. Mr. Barry Schoenfield is the Bureau Chief of Licensing and Records for the DABT. Based on his nearly 20 years with the DABT and his review of final agency documents, he could identify only four DABT actions against corporate license holders based on the felony convictions of the corporations themselves--all of which stem from a common indictment. The DABT settled with the corporations and, for three of the corporations, imposed fines of $1,000, to $7,500. The fourth company agreed to divest itself of its license. Ms. Louisa Hargrett is a staff attorney who has been with the DABT for the past 3 1/2 years and has dealt with literally hundreds of cases. Ms. Hargrett presented the representatives cases that he had discovered in a search of her files. None of these cases involved corporations who themselves have been convicted of a felony. The DABT admits that it has no procedure for determining whether corporations that hold alcoholic beverage licenses have been convicted of a felony within the last fifteen years. DABT does not even require corporations applying for a license to list prior criminal convictions. Actions by Other States Against Southland Other states have imposed penalties against Southland for its 1984 conviction. California accepted an offer of compromise in the amount of $157,680 in lieu of a 30-day suspension. There was also a probationary period of one year. Colorado agreed to a ten-day suspension, with the suspension held in abeyance for a one-year probationary period. This penalty applied to both alcoholic beverage and lottery licenses. Connecticut agreed to an offer of compromise in the amount of $250 per license, for a total of $6,750. Hawaii accepted payment of a penalty of $500 per business for a total of $15,500. Illinois was paid a penalty of $27,000 for restitution. Iowa agreed to a accept a 30-day suspension with 27 days remitted and cancelled. Southland also paid a penalty of $12,500 in Iowa. In Michigan, Southland paid a penalty of $22,600. In New York, Southland paid a penalty of $46,000 plus an additional fine of $10,000 for the conviction of Matthews which subsequently was reversed. Oregon agreed to impose a penalty of $455 per license, for a total of $8,190, and a suspension of 3 days per license.
The Issue Whether petitioner taxpayer is liable for delinquent sales tax, penalties, and interest under Chapter 212, Florida Stat utes, as alleged by respondent Department in its notice of proposed assessment.
Findings Of Fact The Taxpayer Taxpayer is a family-operated Florida corporation which has engaged in retail sales at the Tampa Port Authority since 1975 or 1976; it is a licensed dealer registered with the Department. (Testimony of Roberts, Marylis.) Taxpayer's Sales During Audit Period From June 1, 1977, through July 31, 1980 (the audit period covered by the Department's proposed assessment), Taxpayer had gross sales in the approximate amount of $691,013.46. (Testimony of Roberts; Exhibit 2.) During that period, Taxpayer filed the required DR-15 monthly sales tax reports and paid taxes on all retail sales transactions which took place on the premises of its store located at 804 Robinson Street, (Tampa Port Authority) Tampa, Florida. (Testimony of Roberts.) During the same audit period -- in addition to sales on its store premises -- Taxpayer sold goods to merchant seamen on board foreign vessels temporarily docked at the Port of Tampa. These vessels operated in foreign commerce, entering the port from and returning to international waters outside the territorial limits of the United States. Taxpayer did not report these sales on its monthly sales tax reports; neither did it charge or collect sales tax from the on-board purchasers. (Testimony of Marylis.) Taxpayer failed to charge or collect sales tax in connection with its on-board sales because it relied on what it had been told by Department representatives. Prior to forming Taxpayer's corporation Thomas Marylis went to the local Department office to obtain a dealer's certificate. While there, he asked Manuel Alvarez, Jr., then the Department's regional audit supervisor, whether he was required to collect sales tax on ship-board sales. Alvarez replied that he didn't have to collect sales taxes on sales made to seamen when he delivered the goods to the ship. 1/ (Testimony of Marylis.) The on-board sales transactions took place in the following manner: Taxpayer (through its owner, Thomas Marylis) would board the foreign vessel and accept orders from the captain, chief mate, or chief steward. (Earlier, one of these persons would have taken orders from the rest of the crew.) If individual crewmen tried to place orders, Marylis would refer them to the captain, chief mate, or chief steward. After receiving orders from one of these three persons, Marylis would return to Taxpayer's store, fill the order, and transport the goods back to the vessel. Whoever placed the order would then examine the goods and give Marylis the money /2 collected from the crew. (Testimony of Roberts, Marylis.) The goods sold in this manner were ordinarily for the personal use of individual crew members; typical items were: shoes, underwear, working clothes, small radios, watches, suitcases, soap, paper towels, and other personal care products. (Testimony of Marylis.) Department Audit of Taxpayer In 1980, the Department audited Taxpayer's corporate books to determine if sales tax had been properly collected and paid. Taxpayer could produce no dock or warehouse receipts, bills of lading, resale certificates from other licensed dealers, or affidavits verifying that its on-board sales were made to out-of-state purchasers for transportation outside of Florida. (Testimony of Roberts, Marylis.) Due to Taxpayer's failure to supply documentation demonstrating that its ship-board sales from June 1, 1977, to July 31, 1980, were exempt from sales tax imposed by Chapter 212, Florida Statutes, the Department issued a proposed assessment on September 23, 1980. Through that assessment, the Department seeks to collect $21,201.01 in delinquent sales tax, $5,131.39 in penalties, and $3,892.18 in interest (in addition to interest at 12 percent per annum, or $6.97 per day, accruing until date of payment). (Exhibit 5.) Informal Conference with Department; Alvarez's Representations to Taxpayer In October 1980 -- after the audit -- Taxpayer (through Marylis) informally met with Manuel Alvarez, the Department's regional audit supervisor, to discuss the tax status of the shipboard sales. Specifically, they discussed the Department auditor's inability to confirm that Taxpayer delivered the items to the ships, as opposed to the buyers picking up the goods at the store. Alvarez told him: [I]f the buyers would come and just pick them up and take them. And I [Alvarez] think I told him that, if that was the case, it was taxable. But, if they just placed their orders there -- like we have had other ship supplies -- and they them- selves, or one of their employees, would take the items aboard ships, that would be an exempt sale. I did make that state ment. If we had any type of confirmation to that effect, when it comes to that. (Tr. 61.) 3/ (Testimony of Alvarez.) Alvarez then told Marylis to obtain documentation or verification that the sales were made on foreign vessels, i.e., proof that Taxpayer delivered the goods to the vessels. He assured Marylis that if he could bring such verification back, such sales "would come off the audit." (Tr. 62.)(Testimony of Alvarez.) Alvarez was an experienced Department employee: he retired in 1980, after 30 years of service. It was Alvarez's standard practice -- when dealing with sales tax exemption questions -- to reiterate the importance of documentation. He would always give the taxpayer an opportunity -- 30 days or more -- to obtain documentation that a sale was exempt from taxation. (Testimony of Alvarez.) Taxpayer's Verification In response to the opportunity provided by Alvarez, Taxpayer (through Marylis) obtained affidavits from numerous captains of foreign vessels and shipping agents. Those affidavits read, in pertinent part: I, [name inserted] , am the Captain aboard the vessel [name inserted] from [place of origin]. I am personally aware that Speros International Ship Supply Co., Inc. sells various commodities, supplies, clothing, and various sundry items to for eign ship personnel by delivering the said items to the ships docked at various termi- nals inside the Tampa Port Authority and other locations in Tampa, Florida from [date] to the present. (Testimony of Marylis; Exhibit 8.) Moreover, in an attempt to comply with the tax law and avoid similar problems in the future, Taxpayer printed receipt books to be used in all future on-board sales. The receipts reflect the type of goods sold, the date of delivery to the vessel, the foreign vessel's destination, and the total purchase price. Also included is a signature line for the individual who delivers and receives the goods. (Testimony of Marylis; Exhibit 7.)
Recommendation Based on the foregoing, it is RECOMMENDED: That Department's proposed assessment of Taxpayer for delinquent sales tax, penalties, and interest, be issued as final agency action. DONE AND RECOMMENDED this 17th day of February, 1982, in Tallahassee, Florida. R. L. CALEEN, JR. 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 17th day of February, 1982.
Findings Of Fact 5. The Division hereby adopts and incorporates by reference the Findings of Fact numbered 1 through 14 as set forth in the Recommended Order.
Conclusions The Director of the Division of Florida Land Sales, Condominiums, and Mobile Homes (Division) enters this Final Order in the above referenced matter.
Appeal For This Case Ye ee eee THIS FINAL ORDER CONSTITUTES FINAL AGENCY ACTION AND MAY BE THIS FINAL ORDER UCONN YI ES TINA eee e———EESeaeeweorose APPEALED BY_ANY PARTY SUBSTANTIALLY AFFECTED BY THIS FINAL ORDER APPEALED BY_ANY FARK] Y olUpolANyA.T oaoes--- Oo ——o PURSUANT TO SECTION 120.68, FLORIDA STATUTES, AND RULE 9.1 10, FLORIDA RULES OF APPELLATE PROCEDURE, BY FILING A NOTICE OF APPEAL CONFORMING TO THE REQUIREMENTS OF RULE 9.110(d), FLORIDA RULES OF APPELLATE PROCEDURE, BOTH WITH THE APPROPRIATE DISTRICT COURT _OF APPEAL, ACCOMPANIED BY THE APPROPRIATE FILING FEE, AND WITH THE AGENCY CLERK, DEPARTMENT OF BUSINESS _ AND PROFESSIONAL REGULATION, AT 1940 NORTH MONROE STREET, TALLAHASSEE, FLORIDA 32399-1007 WITHIN THIRTY (30) DAYS OF THE RENDITION OF THIS ORDER. Department of Business and Professional Regulation, Page 3 of 4 Division of Florida Land Sales, Condominiums, and Mobile Homes v. Fernando Fernandez DOAH Case No. 04-0771; BPR 2003089755 CERTIFICATE OF SERVICE | HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished by U.S. Certified Mail to Fernando Fernandez, 15397 Southwest 168" Terrace, Miami, Florida 33187, this day of , 2004. Robin McDaniel, Docket Clerk Copies furnished to: Division of Administrative Hearings Janis Sue Richardson, Office of the General Counsel Robert Badger, Section Head, Yacht & Ship Regulation Department of Business and Professional Regulation, Page 4 of 4 Division of Florida Land Sales, Condominiums, and Mobile Homes v. Fernando Fernandez DOAH Case No. 04-0771; BPR 2003089755
The Issue The issue for determination is whether Petitioner is liable for use tax, pursuant to Chapter 212, Florida Statutes, to the Florida Department of Revenue for the use and storage of a vessel.
Findings Of Fact Camden Corporation (Petitioner) is a foreign corporation, incorporated in Delaware on August 7, 1990. Petitioner is a solely owned, closed corporation. Petitioner has two officers: a President, who is the sole owner, and a Treasurer. At all times material hereto, Petitioner's President and Treasurer were residents of Jacksonville, Florida. Petitioner's business address is in Jacksonville, Florida. Petitioner's officers handled its day-to-day activities and records from Jacksonville, Florida. Prior to the Petitioner's incorporation, its President wanted to purchase a vessel to take a world wide cruise. He obtained the services of a law firm to advise him on avoiding a state's sales and use tax on the purchase of a vessel, with Florida being one of the states. A lawyer in the firm contacted the Florida Department of Revenue (Respondent) and inquired, without relating any of Petitioner's factual circumstances, as to whether the case of Department of Revenue v. Yacht Futura, 510 So.2d 1047 (Fla. 1st DCA 1987) was still good case law in Florida. Yacht Futura was a case in which the parameters of Florida's sales and use tax were interpreted regarding repairs and personal use of vessels while in Florida waters. Respondent's representative informed the firm's lawyer that Yacht Futura was still being followed by Respondent and that no exceptions existed; but Respondent's representative further cautioned that the factual circumstances must conform to Yacht Futura. The firm's lawyer prepared a memorandum advising Petitioner's President, among other things, that no liability for Florida's sales and use tax would be incurred for repairs and personal use of a vessel in Florida's waters, so long as the circumstances complied with Yacht Futura. After having received the firm's advice and advice from tax advisors, Petitioner's President created and incorporated Petitioner. On August 14, 1990, Petitioner purchased a used motor vessel in international waters for $5,618,000. The vessel was a 131' Feadship with Coast Guard documentation number 623589. Petitioner named the vessel "CAMDEN." The CAMDEN was the only assest owned by Petitioner. Petitioner did not pay any Florida sales tax at the time of CAMDEN's purchase. From August 14, 1990 through October 15, 1990, the CAMDEN was outside the State of Florida. Petitioner's President had taken the vessel on a cruise. During the time period that the vessel was on the cruise, Petitioner did not pay any sales or use tax in any jurisdiction in the United States. Also, during the time period that the vessel was on the cruise, Petitioner did not license, title, or register the CAMDEN in any jurisdiction in the United States. On October 15, 1990, relying on the law firm's advice, Petitioner imported the CAMDEN into Florida waters for major repairs, with the intention of departing after the repairs and not returning to Florida waters. Petitioner obtained the services of Huckins Yacht Corporation, a registered repair facility, in Jacksonville to perform repairs to the CAMDEN, which had a dock in Huckins Marina. However, the dock at Huckins Marina was unable to accommodate a vessel the size of the CAMDEN. The vessel was docked at Southbank Marina which could accommodate the vessel and which was the closest marina to Huckins Marina. Petitioner's President was not in the State of Florida when the CAMDEN arrived in Florida waters. He did not return to Florida until October 24, 1990. Petitioner did not have a written contract with Huckins Yacht Corporation (Huckins) to perform any repairs on the CAMDEN. However, Huckins did perform some minor repairs to the CAMDEN. Also, Huckins arranged for a major repair to the CAMDEN. It arranged for Petitioner to purchase a global position satellite electronic system as a nonwarranty repair. The electronic system was to be installed by someone who was not an employee of Huckins and who did not have a contractual agreement with Huckins for the installation. The electronic system was installed on the CAMDEN at the Southbank Marina. During the time that repairs were being made to the CAMDEN, its crew remained on board. Petitioner never received any bill from Huckins for any repairs made to the CAMDEN, including the installation of the electronic system. While the vessel was docked for repairs at the Southbank Marina, it was used for personal entertainment. On October 25, 1990, Petitioner's President and his friends had an open house type of party on the CAMDEN. On October 26, 1990, Petitioner had a luncheon cruise on the CAMDEN. On October 27, 1990, Petitioner had a dinner cruise and a birthday party for the daughter of Petitioner's President. On October 28, 1990, Petitioner took the CAMDEN from Jacksonville to St. Augustine for a pleasure trip. Leaving St. Augustine, the CAMDEN traveled to Miami, Florida and docked there on October 30, 1990, to get the vessel prepared for world travel. In Miami, the CAMDEN was docked at the Moorings Yacht Services, Inc. (Moorings), a registered repair facility. In November 1990, the Moorings began repairs to the CAMDEN, and in December 1990, the vessel departed the Moorings. In November 1990, Petitioner hired a tax consultant, who was a former employee of Respondent, for advice regarding Petitioner's liability for sales and use tax of the CAMDEN in Florida. The tax consultant advised Petitioner to register the CAMDEN as a charter for sales and use tax. Further, he advised Petitioner to late-file with Respondent an Exemption Affidavit for Boats Placed in a Registered Repair Facility, referred to as a Safe Harbor Affidavit, pursuant to Subsection 212.08(7)(t), Florida Statutes. On December 19, 1990, a Safe Harbor Affidavit was executed by both Huckins and Petitioner's President. The Safe Harbor Affidavit indicated, among other things, that Huckins was a registered repair facility in Jacksonville, Florida and that, from October 16, 1990 through October 25, 1990, the CAMDEN was under the care, custody, and control of Huckins for the purpose of installing electronics, which was the electronic system. Even though the Safe Harbor Affidavit does not provide that Huckins installed the electronic system on the CAMDEN, it does infer that Huckins had installed the electronic device. Respondent interprets "care, custody, and control" as the vessel being in the "physical" care, custody, and control of the registered repair facility. Clearly shown on the Safe Harbor Affidavit is that it is to be filed with the Respondent within 72 hours after the repair facility takes possession of the vessel. Additionally, clearly shown on the Safe Harbor Affidavit is that a copy of it is to be filed with Respondent within 72 hours after the work is completed and the vessel is released to the owner. On or about December 22, 1990, the CAMDEN departed Florida waters for a pleasure cruise to the Bahamas. In early January 1991, the vessel returned to Florida. The CAMDEN remained in Florida until mid-January 1991, when it traveled to the Caribbean. Around mid-May 1991, the vessel returned to Florida. In 1990, Petitioner was not issued a permit by any agency of the United States government to use the CAMDEN in Florida waters. In April 1991, one of Respondent's representatives discovered, during a routine examination of the records of the Miami Marina, that the CAMDEN was named as a boat docked in Florida with an out-of-state hailing port. On May 13, 1991, Respondent's representative sent a Declaration for Florida Sales and Use Tax (Declaration) to Petitioner for it to complete and return to Respondent. Instead of completing the Declaration, on December 10, 1991, Petitioner's tax consultant delivered the Safe Harbor Affidavit executed on December 19, 1990, to Respondent's representative. Additionally, Petitioner's tax consultant verbally supported the Safe Harbor Affidavit by stating that the CAMDEN was docked at Southbank Marina in Jacksonville while the repairs to the vessel were being completed by Huckins and the nonemployee. The Moorings filed a Safe Harbor Affidavit with Respondent, providing that the CAMDEN entered the facility in November 1990 and departed in December 1990. The Safe Harbor Affidavit was not submitted to Respondent within 72 hours of the CAMDEN either entering the facility for repairs or departing the facility after the repairs were completed. 1/ Respondent has a practice of accepting late-filed Safe Harbor Affidavits, with the condition that all documents supporting repairs are also to be submitted. A subsequent review of all the documents submitted would determine whether a person would be responsible for sales and use tax. On December 10, 1991, based on the Safe Harbor Affidavit and the representations by Petitioner's tax consultant, Respondent's representative closed her file regarding the sales and use tax, without assessing any sales or use tax against Petitioner. However, she forwarded neither a closing letter nor a closing agreement to Petitioner. Even though Petitioner had not received a closing letter or a closing agreement from Respondent, it believed that Respondent had terminated its inquiry of any assessment against it. In or around November 1991, another of Respondent's representative (Respondent's second representative) observed, while performing a routine marina check, the CAMDEN docked at the Palm Harbor Marina in West Palm Beach, Florida. Subsequently, he opened a new file on the CAMDEN. Petitioner was unaware that Respondent's second representative had opened a new file. Respondent's second representative performed an investigation of the vessel, including reviewing the Safe Harbor Affidavit submitted to the Respondent's other representative on December 10, 1991. His investigation led to the assessment at issue. The investigation by Respondent's second representative showed, and it is determined as a finding of fact here, that the CAMDEN was not in the physical care, custody, and control of Huckins during the repairs for the period October 16, 1990 through October 25, 1990. From October 15, 1990, when the CAMDEN entered in Florida waters for repairs, the vessel remained in Florida for more than a total of 10 days. Petitioner decided to sell the CAMDEN and listed it for $6.9 million. On February 14, 1992, Petitioner sold the CAMDEN for $5.3 million, which was $1.6 million less than it was originally listed. For 1991 and 1992, Petitioner's President treated the CAMDEN as his personal second home and took a home interest deduction for federal income tax purposes. On October 10, 1992, Respondent notified Petitioner that it was assessed, as of April 10, 1992, a tax of $337,080, representing: 6 percent of the CAMDEN's purchase price of $5,618,000; $84,270 in penalty; $168,540 in specific penalty; and $59,826.60 in interest. On October 26, 1992, Respondent issued a notice of final assessment to Petitioner which included the above assessment and the facts and reasons, including legal reasons, for the assessment. Petitioner contested the assessment. On January 14, 1994, Respondent issued a notice of reconsideration of the assessment and revised final assessment, withdrawing the $168,540 in specific penalty but sustaining the remaining assessment of $503,113.02, which represented: $337,080 tax; $84,270 penalty; and $81,763.02 interest. In its notice of reconsideration, Respondent determined, among other things, that Petitioner was issued an out-of-state registration, effective December 1, 1990, as a result of Petitioner submitting an application for sales and use tax registration, listing the major business activity as rental of tangible personal property. Additionally, Respondent determined, among other things, that Petitioner, as the corporation, maintained control and use of the CAMDEN during the period December 1990 through February 1992 when the CAMDEN was sold. No tax at issue was assessed for this period of time. Petitioner protested the revised assessment. Petitioner has not paid any Florida use tax.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order affirming the assessment of use tax against the Camden Corporation in the amount of $503,113.02, plus accrued interest. DONE AND ENTERED on this 30th day of September, 1996, in Tallahassee, Leon County, Florida. ERROL H. POWELL, 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 30th day of September, 1996.
Recommendation It is, therefore, recommended that the petition be dismissed for lack of standing on the part of the Petitioner to bring such action. DONE AND ENTERED this 7th day of May, 1979, in Tallahassee, Florida. CHARLES C. ADAMS, Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: Trace H. Bolosky, Esquire Carroll, McPeak, Bolesky & Schryver 1169 Eighth Street South Naples, Florida 33940 George L. Varnadoe, Esquire Post Office Box 17907 Naples, Florida 33941 Joseph C. Mellichamp, III, Esquire Assistant Attorney General The Capitol, LL04 Tallahassee, 32301 John D. Moriarty, Esquire Department of Revenue Room 104, Carlton Building Tallahassee, Florida 32301
The Issue The issue posed herein is whether or not the Petitioner remitted to Respondent, pursuant to Chapter 212.05(1), Florida Statutes, the, proper amount of sales tax on the boat "Captain Deebold" which was purchased on November 29, 1976. A related issue, assuming that the proper sales taxes were not remitted by Petitioner, is whether or not a levy of penalty and interest is warranted under the circumstances.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received, legal memoranda submitted by the parties and the entire record compiled herein, the following relevant facts are found. Petitioner purchased the vessel "Captain Deebold" on November 29, 1976, and alleged that the purchase price of the boat was $20,000.00. Accordingly, Petitioner remitted to the Department sales taxes based on the declared value of $20,000.00. Respondent maintained that the subject boat was purchased for the sum of $75,000.00 and has, therefore, issued an assessment against Petitioner for the additional taxes, penalty and interest. By letter dated November 29, 1978, Respondent's Revenue Investigator, Leslie J. Smithling, advised Petitioner that a routine verification concerning his purchase of the subject boat revealed a transaction amount of $75,000.00 upon which the four percent Florida Sales Tax is $3,000.00. Petitioner was further advised therein that his remittance in the amount of $4,202.00 was due no later than December 15, 1979. Taxes, penalties and interest were calculated as follows: Purchase Price $75,000.00 Tax Rate 4% Tax $ 3,000.00 Minus Tax Paid (Based on $20,000.00) $ 800.00 Tax Due $ 2,200.00 Administrative Penalty (Ch. 212.12[2], F.S.) $ 550.00 Fraud Penalty (Ch. 212.12[2], F.S.) $ 1,100.00 Interest: 1% per month from 8/1/77 to 12/1/77 16% Plus $.72 daily thereafter Total Interest Accrued $ 352.00 Total Tax, Penalties & Interest Due $ 4,202.00 In support of its position that the true purchase price of the boat was only $20,000.00, Petitioner points out that the seller of the boat, Frank Deebold, had neglected the boat and had only made repairs that were absolutely necessary to operate the vessel. Thus, when Petitioner purchased the vessel, numerous repairs were made to make it seaworthy including 1) repaired electrical wiring; 2) sealed the deck seams; 3) reconnected the port fuel tank; 4) repaired the clutch in the port engine; 5) repaired leaks in the starboard stern quarter; 6) replaced and rebolted the chines; 7) replaced a section of the keel; 8) rebuilt the main clutch; 9) caulked deck; 10) replaced or repaired the winch on the anchor; 11) reworked and/or repaired the engine room, including insulation, lighting, lining, painting and hauling. To perform these repairs, Petitioner places the value on materials utilized at approximately $18,000.00. Additionally, Petitioner estimated that the value of his labor involved in making the approximately $25,000.00. The articles of agreement for the purchase of the boat provides in pertinent part as follows: Witnesseth, that if the said party of the second part shall (purchaser) first make the payments and perform the covenants hereinafter mentioned on his part to be made and performed, the said party of the first part (seller) hereby covenants and agrees to convey and assure to the said party of the second part, his heirs, personal represent- atives or assigns, clear of all encumbrances, whatever by a good and sufficient bill of sale the Oil Screw vessel, Captain Deebold, o/n294675, gross tons-36, its equipment, hull, machinery, present insurance policies and business including fifty or more used rods and reels, one 3.5 KW Lister auxiliary generator, used and in need of repair, spare Jabsco water pump (used and in need of repair), spare 24 volt DC alternator, spare 24 volt DC main engine starter, spare stub shaft, three spare propellers (used and in need of repair) and a spare UHF Pierce- Simpson radio transceiver (used and in need of repair) and the said party of the second part hereby covenants and agrees to pay to the said party of the first part the sum of seventy-five thousand and 00/100 ($75,000.00) dollars in the manner following. . . . Nevertheless, Petitioner stressed that inasmuch as the Articles of Agreement provided that the seller only required Petitioner to maintain insurance coverage in the amount of $50,000.00 indicating that the purchase price was something less than $75,000.00 and in fact was no more than $50,000. Pursuant to the Articles of Agreement, the amount insurance coverage required was $50,000.00. Petitioner also declared that included in the $75,000.00 purchase price were other items which included the business (dock space), and reduced prices for miscellaneous supplies and fuel prices. In this regard, an examination of the Articles revealed that these items were provided Petitioner on a cost plus basis and the dock space was leased for an amount based on a rebate of the percentage of ticket sales or charter fees received. Petitioner ultimately sold the boat for 95,000.00. Petitioner initially tried to sell the boat for the sum of $105,000.00 of which $10,000.00 represented the value he (Petitioner) placed on the business. An examination of the accounting records introduced indicated that Petitioner placed the sum of $75,000.00 as the purchase price for the boat. Petitioner thought that his estimation of the labor and materials necessary to properly repair the boat were items that could be used as a setoff to reduce the amount of taxes due. Petitioner testified that he, in no way, intended to defraud the Respondent of taxes properly due and owing. Petitioner's testimony in this regard is credited.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that: Petitioner remit to the Respondent the proper interest as set forth herein in paragraph 4 of the Conclusions of Law. Petitioner remit to the Respondent an administrative penalty of 5 percent of the aggregate taxes due as set forth herein in Paragraph 5 of the Conclusions of Law. Petitioner not be held liable for payment of for allegedly filing a "false or fraudulent" return for reasons set forth herein in Paragraph 6 of the Conclusions of Law. RECOMMENDED this 27th day of February 1981, in Tallahassee, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 FILED with the Clerk of the Division of Administrative Hearings this 27th day of February 1981.
The Issue Whether the Petitioner is liable for sales tax, interest, and penalties as alleged by the Department of Revenue (Department).
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing, the following Findings of Fact are made: The Petitioner is a Florida corporation formed in October 2004. The principal office and mailing address of the Petitioner is 518 North Tampa Street, Suite 300, Tampa, Florida 33602. The directors of the corporation are Brenda Dohring and Robert Hicks (husband and wife), and Joshua Dohring (their son). Brenda Dohring and Robert Hicks are residents of Tampa, Florida, and registered voters in Hillsborough County. Brenda Dohring and Robert Hicks hold Florida driver's licenses. Joshua Dohring is a resident of the United States Virgin Islands, where he operates a charter boat business. On November 8, 2004, the Petitioner purchased, in St. Petersburg, Florida, a 36-foot catamaran sailboat (hull No. QPQ0000D089) for $113,000. On November 15, 2004, the Petitioner purchased, in St. Petersburg, Florida, an inflatable tender with outboard motor and accessories (hull No. XMO18119G405) for $4,865. The catamaran and tender were purchased for the use of Joshua Dohring in his charter boat business in the Virgin Islands. They were to replace his previous boat that was destroyed by Hurricane Ivan. Because Joshua Dohring did not have sufficient financial resources or credit, Brenda Dohring and Robert Hicks decided to make the purchases for him. They created the Petitioner corporation to purchase and own the catamaran and tender because they wanted protection from personal liability that might arise from Joshua Dohring's use of the vessels in the Virgin Islands. At the time of each purchase, Joshua Dohring was provided a Department affidavit form to be completed and filed with the Department to claim exemption from sales tax. Joshua Dohring indicated the name of the Petitioner corporation on the affidavit forms along with the names of the corporation's directors. The Department's affidavit form for sales tax exemption includes several statements that the affiant must attest to, including the following: 4. I represent a corporation which has no officer or director who is a resident of, or makes his or her permanent place of abode in Florida. David Erdman, a licensed yacht broker in Florida who assisted Joshua Dohring in the purchase of the catamaran and tender, believed that the purchases were exempt from Florida sales tax because Joshua Dohring was not a Florida resident and was going to remove the vessels from Florida. Mr. Erdman did not understand that, because the purchaser was not Joshua Dohring, but a Florida corporation, the sales tax exemption did not apply. Mr. Erdman advised Joshua Dohring that the purchases were exempt from Florida sales tax. There is no evidence in the record, and the Department did not allege, that the Petitioner intended to defraud the State. On this record, it is clear that the Petitioner's directors were simply mistaken in their belief that the purchases of the boats were exempt from Florida sales tax, based primarily on the erroneous advice of Mr. Erdman. The Department made a routine investigation after its receipt of the sales tax exemption affidavits signed by Mr. Dohring and determined that the exemption did not apply because the Petitioner is a Florida corporation with directors who are residents of Florida. In January 2005, the Department notified the Petitioner of its billing for the sales tax due on the boat purchases, plus penalty and interest, totaling $8,474.67. An informal conference regarding the billing was requested by the Petitioner, and a conference was held in an attempt to resolve the matter. Subsequently, the Department's Final Assessment was issued on January 23, 2005, indicating tax, penalty, and interest totaling $9,229.26. Because of the circumstances indicating that the Petitioner's failure to pay was due to a mistake and bad advice, the Department proposes to eliminate the penalty.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department issue an final order: finding that the Petitioner's purchases of the catamaran and inflatable tender are subject to sales tax; and assessing sales tax of six percent on the purchases; and imposing interest on the taxes until paid; and imposing no penalty. DONE AND ENTERED this 22nd day of September, 2005, in Tallahassee, Leon County, Florida. BRAM D. E. CANTER 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 22nd day of September, 2005.
Findings Of Fact Petitioner is a Swiss national, who resides in Jamaica. His business in Jamaica involves water sports and vacation tours, primarily for European tourists. Petitioner attended a boat show in Fort Lauderdale, Florida, in order to locate a suitable boat for entertainment and tour purposes for use by his business in Jamaica. There, he saw The Lady, a vessel being brokered by Anchorline Yacht and Ship Brokerage, Inc., of St. Petersburg, Florida. On February 28, 1980, Petitioner purchased The Lady from Anchorline for $120,000. Prior to that date, a survey was conducted by Wilkinson Company, marine surveyors, and repairs indicated by that survey were completed at South Pasadena Marina, Inc. At the time that Petitioner purchased The Lady from Anchorline, he advised the broker that he was taking the vessel out of the country. Accordingly, the broker required Petitioner to sign an affidavit that Petitioner had read the provisions of Section 212.05, Florida Statutes, and no tax was collected on the sale and purchase of The Lady. As The Lady was journeying from St. Petersburg across the State of Florida to West Palm Beach in order to reach Jamaica, she started taking on water. She was taken to Lantana Boatyard, where another marine survey was conducted. That survey concluded that The Lady was not seaworthy and, therefore, could not be taken to Jamaica at that time. As one of the required repairs, her engines needed to be overhauled by Cummins in Miami. Accordingly, after the repairs to be made at the Lantana Boatyard were completed, The Lady was taken to the Keystone Point Marina in North Miami, Florida, so that the work on her Cummins engines could be undertaken. During this time, Petitioner attempted to register The Lady in Jamaica; however, the Jamaican Government refused to license or register the vessel since she was not in Jamaica but was still physically located within the State of Florida. As a result of discussion between Petitioner and a Mr. Mathews at Anchorline, on September 18, 1980, the Petitioner made application for a Florida boat Certificate of Title at a tag agency. He reported the purchase price as ten dollars and, accordingly, paid forty cents tax on the transaction. Cummins started the repair work necessary on The Lady's engines while she had been docked at the Keystone Point Marina. On occasion, Petitioner has stayed overnight on The Lady for security purposes. He has had a telephone attached to the vessel for his personal use while on board. On January 7, 1981, Respondent Department of Revenue issued a Warrant for Collection of Delinquent Sales and Use Tax against the Petitioner in the total amount of $9,967.37, representing the follows: Tax $4,799.60 Penalty 4,799.60 Interest 350.17 Filing Fee 18.00 $9,967.37 On January 19, 1981, Petitioner made payment to Respondent Department of Revenue in the amount of $5,167.77, which payment was made under protest and which payment represents the amount of tax, interest, and filing fees, but does not include the amount of penalty. Pursuant to its warrant, the Department of Revenue has chained The Lady to the dock at the Keystone Point Marina. Accordingly, the work being performed by Cummins on her engines has not been completed, and no sea trial can be conducted. As stipulated by the parties, since the Petitioner purchased The Lady, she has been under repair and has never left Florida waters.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is therefore, RECOMMENDED THAT: A final order be entered denying Petitioner's claim for a refund, finding the Petitioner liable for a sales tax equal to four percent of the purchase price, together with interest and filing fees, but finding the penalty assessed against Petitioner to be erroneous and therefore invalid. DONE AND ENTERED this 8th day of October 1981 in Tallahassee, Florida. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 8th day of October 1981. COPIES FURNISHED: Michael Lechtman, Esquire 801 N.E. 167th Street, Suite 301 North Miami Beach, Florida 33162 John Browdy, III, Esquire Assistant Attorney General Department of Legal Affairs The Capitol Tallahassee, Florida 32301 Mr. Randy Miller Executive Director Department of Revenue 102 Carlton Building Tallahassee, Florida 32301 The Honorable Gerald A. Lewis Comptroller, State of Florida The Capitol Tallahassee, Florida 32301
