Findings Of Fact At all times relevant hereto, respondent, Robert A. Sempell, was a licensed real estate broker having been issued license number 02178232 by petitioner, Department of Professional Regulation, Division of Real Estate (Division). Respondent, Virginia Bloise, was also a licensed real estate broker having been issued license number 0376974. Respondent, Home Shoppe, Inc., is a corporation registered as a broker having been issued license number 0229887. When the events herein occurred, the firm was located at 2610 North Federal Highway, Boynton Beach, Florida. Sempell operated as qualifying broker for Home Shoppe, Inc., from November 14, 1983, until October 12, 1984, Bloise was a salesperson with the same firm from July 9, 1984, until October 18, 1984, when she assumed the position of broker of record. Ilana Frank was the firm's only licensed salesperson, and she worked for the firm from 1983 until around January, 1986. In February, 1984, Frank represented Morgan King, an individual interested in purchasing a home located at 502 Northeast Second Street, Delray Beach, Florida. The property was listed with Douglas Rill and Associates, Inc., a West Palm Beach real estate firm. The home was owned by Joseph Michell, a Pratt-Whitney employee being transferred to Texas, and he had turned it over to TransAmerica Relocation Service, Inc. (TransAmerica), a firm that handled real estate sales for Pratt-Whitney employees who were relocating to other areas of the country. Deciding to purchase the property, King executed a standard contract on February 20, 1984 to purchase the home for $125,000. The contract contained a clause providing that the purchase was contingent on King obtaining a Veterans Administration (VA) loan in the amount of $122,250 at a 12 1/2 percent interest rate. 3/ A closing date of May 20, 1984, was established by the parties. The contract provided further that King would make a $1,200 cash deposit and that, pursuant to an addendum executed on February 22, he could rent the house until closing at a rate of $628 per month. Finally, the contract required that King give an extra $3800 to be deposited in escrow before moving into house, and within 45 days after the contract was executed, to 'submits' an additional $3,000. The addendum provided, however, that the $8,000 was "nonrefundable." After King signed the original contract, he gave Frank a $1,200 deposit. Frank, who was not a signatory on the firm's escrow account, carried the money to Sempell who placed his signature on the contract as an acknowledgment of receipt of deposit. Whether the money was deposited into the firm's escrow account is not of record. In any event, King did not have the extra $3800 needed to satisfy the initial deposit requirements of the contract. To ensure that a closing could be held, Frank approached Alan D. Mentser, a real estate salesman with another firm, Bob Railey's Realty, Inc., and asked if he would loan King the money until the anticipated closing on March 30, 1984. 4/ Mentser agreed to do so with the understanding that the $3800 would be placed immediately in an escrow account until closing. When he loaned the money, Mentser was under the impression that the money would be held in the escrow account of Douglas Rill, the listing broker. Because Mentser did not feel comfortable loaning the money to King, a person who he did not know, he required Frank to sign a promissory note on February 24, 1984 in the amount of $3800. At the same time, King signed an identical promissory note for $3800 payable to Frank. In addition, Frank orally agreed with Mentser that, for the use of his $3800 until March 30, 1984, she would pay him $1200 interest, or a handsome thirty percent return on his money. The $1200 was to be taken out of Frank's portion of the broker commission split. However, Mentser recognized that he was not a participating broker or salesman in the transaction and had no formal claim to the escrowed money in a realtor capacity. Indeed, the loan to Frank was personal in nature, and although Mentser intended it to be used as a part of the deposit, it was not considered a part of the real estate transaction. On February 24, Mentser gave Frank $3800 in cash which she promptly gave to Bloise the same day. Bloise was a signatory on the firm's trust account and had authority to make deposits and disbursements. After Bloise prepared a deposit receipt, Frank used $300 of the $3800 to purchase renter's insurance for King and deposited the remaining $3500 in Home Shoppe, Inc.'s escrow account at the Bank of South Palm Beaches in Lantana. The $300 deduction was made pursuant to an agreement by all parties. After King took possession of the property, he failed to qualify for a VA loan. Sometime later, he moved out of the house with no notice to the realtors or seller and gave no forwarding address. His whereabouts are unknown. TransAmerica later instituted eviction proceedings in order to legally take possession of the property. A final judgment of eviction was obtained on July 6, 1984. By now March 30, 1984, had come and gone and Mentser was eager to get his money. He initially contacted Frank but learned something had gone awry with the contract. When his informal requests to Frank were unsuccessful, Mentser engaged the services of an attorney who wrote a certified letter on May 4 to Sempell demanding a refund of his money from the firm's escrow account. After the letter was returned three times, the attorney had the letter hand- delivered to the firm's address where Frank signed for it. There is no evidence that Sempell was given the letter. After Mentser contacted Frank about his money, Frank spoke to Bloise on several occasions concerning Mentser's inquiry. The dates of these conversations are not of record. In any event, Bloise told her that a "dispute" had arisen over the escrow deposit and until it was resolved by the Division, Mentser could not get his money. This was not true since Bloise never turned the matter over to the Division for resolution. On July 12, 1984, the seller made a formal claim for the full deposit on the ground King had breached the contract and forfeited the deposit. Although there is no specific evidence as to the disposition of the claim, it may be reasonably inferred that TransAmerica's claim has not been honored. On August 6, 1984, Mentser obtained a default judgment against Frank in circuit court and was awarded $3800 in damages, prejudgment interest of $160, attorney fees of $300, and fees and costs of $50, or a total of $4310. He wisely did not request that he also be awarded the $1200 interest for the use of his money. The judgment has never been satisfied. Sempell went "out of the country" sometime in 1984 and was absent for much of the year. There is no evidence he received any demands for Mentser's money before he resigned as broker of record nor is there evidence that he was a signatory on Home Shoppe, Inc.'s escrow account. Indeed, the president of the bank in which the firm's escrow account was placed knew only that Bloise was a signatory on the account. Further, copies of cancelled checks written on the account and introduced into evidence reflected only Bloise's signature. The allegation that in October, 1984, Sempell absconded with certain funds from the firm's escrow account was not addressed at hearing and has been disregarded. Partial bank records of the firm's escrow account reflect that the $3500 was properly deposited into the account on February 27, 1984. As of December 28, 1984, the balance in the account had dropped to $1,688.98, which meant at least a part of the deposit had been spent for other purposes. Whether these expenditures occurred before or after Sempell resigned as broker of record is unclear. In any event, Bloise acknowledged to a Division investigator in May, 1987, that she had written a number of checks on the account for her own use. She justified this action by explaining that Frank had told her that the $3800 was their "own" money and could be spent "to run the business." Bloise also confirmed that, when this controversy arose, she was the only signatory on the firm's account and that Sempell had no authority to write checks or make disbursements.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondents be found guilty of violating Subsections 475.25(1)(b), (d) and (k), Florida Statutes (1983), and that the broker licenses of Bloise and Home Shoppe, Inc. be suspended for five years. Sempell's broker license should be suspended for one year. DONE AND ORDERED this 20th day of July, 1988, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 20th day of July, 1988.
Findings Of Fact Testimony established that during late December, 1975, Land Re-Sale Service, Inc., a Florida corporation, filed application with the Commission, seeking registration as a corporate real estate broker. That application revealed that Respondent Frank Viruet was to become the Active Firm ember Broker, and Vice President of the company; that Carol Bauman was to become Secretary-Treasurer and that Lee Klein was to become President and Director of the company. Testimony reveals that Carol Bauman is the wife of the Respondent Bernard Bauman; that Lee Klein is the sister of Carol Bauman and that Jeffrey Bauman is the son of Bernard Bauman. Subsequent to the filing of the above referenced corporate application for registration, the name was changed to Noble Realty Corporation and shortly thereafter to Deed Realty, Inc., and that at each such change, new application for corporate registration was filed with the Commission. Evidence also revealed that the officers and Active Firm Member Broker remained as stated and therefore for all legal purposes, the above corporate entities are one and the same. Turning to the complaint allegations in Count One, according to the certificates of the Commission's Chairman, dated December 3, which was offered in evidence by Petitioner and admitted without objection, during the period of November 1, 1975 through the date of said certificate (December 3, 1976), which covers the material dates of the complaint herein, no registration was issued to or held by the above three named corporations. This was further confirmed by testimony of Bernard Bauman who was to have become a salesman associated with the above entities and by Frank Viruet, the broker, who was to have become the Active Firm Member Broker for the above entities. Approximately December 2, 1975, Land Re-Sales Service, Inc., entered a written lease for office premises known as Room 212, Nankin Building, which is located at 16499 N.E. 19th Avenue, North Miami Beach, covering the period January 1, through December 31, 1976. (A copy of the lease was entered into evidence by stipulation of the parties.) The unrebutted testimony of Petitioner Reagan was that he observed, during his investigation of this cause, a building directory on the ground floor entrance to the Nankin Building displaying the name Noble Realty Inc., and a similar display on the building directory on the second floor. Petitioner's witness, Peter King, representative for Southern Bell Telephone Company testified that based on records received, three phones were installed in said room 212, Nankin Building on December 27, 1975, in the name of Land Re-Sale Service, Inc. and that from January 2, 1976 through January 16, 1976, approximately 575 calls were made from the above phones during evening hours to out-of-state numbers. Bernard Bauman and Jeffrey Bauman admitted to having made phone calls to out-of-state numbers for purposes of soliciting real estate sales listings, but both were unable to recall nor did they have records to substantiate how many calls they made. Bernard Bauman testified that approximately four listings were obtained with an advance fee of $375.00 for each listing. He further testified that upon being advised by the investigator with the Commission that the operation was in violation of the licensing law, by reason that no registration had been issued to the applicant company and that all who were engaging in real estate activities for said company were in violation of the licensing law. Thereafter the premises were closed and as best as can be told, all real estate activities ceased. This was further confirmed by Petitioner Reagan. The evidence respecting Count two of the administrative complaint established as stated above that Respondents Bernard and Jeffrey H. Bauman solicited real estate listings with representations to property owners that the listings would in fact be published and disseminated to brokers nationwide. However, both Baumans admitted that their listings were never published or otherwise disseminated to brokers. According to Bernard Bauman's testimony, no monies received were ever returned. There was no evidence to show that Respondent Bernard Bauman knew at the time of soliciting that no bona fide effort would be made to sell properties so listed with Noble Realty Corporation.
Recommendation Based on the above findings and conclusions of law, it is therefore recommended that the registration of Bernard Bauman be revoked. DONE and ENTERED this 12th day of January, 1977, in Tallahassee, Florida. JAMES E. BRADWELL, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304
The Issue The issues are whether Respondent violated Sections 475.25(1)(a), 475.25(1)(b), 475.25(1)(d), 475.25(1)(e), and 475.25(1)(k), Florida Statutes, and if so, what penalty should be imposed.
Findings Of Fact Respondent Phillip F. Niles, is and was, at times material to this matter, a licensed real estate broker. His license number is 0173298. Respondent's license was inactive from August 2, 1996, through March 31, 1997. It was invalid due to non-renewal from March 31, 1997 through May 28, 1997. From May 29, 1997 through August 20, 1997, Respondent was an active broker. From August 21, 1997 through June 10, 1998, Respondent was an inactive broker. From June 11, 1998, through the date of the formal hearing, Respondent was an active individual broker. The address of his last license was 1700 Ridge Avenue, Holly Hill, Florida 32117. Sam L. Berry owned a condominium located at 840 Center Street, Unit 101, Holly Hill, Florida (hereinafter referred to as the property). Sometime prior to April 27, 1997, Mr. Berry asked Respondent to sell the property. Mr. Berry wanted to receive $20,000 for the property. Mr. Berry told Respondent that he could keep any amount of the sales price in excess of $20,000. Respondent placed an advertisement for the sale of the property in the newspaper. Thereafter, he prepared a Contract for Sale and Purchase (the contract) for the sale of the property with $20,000 as the sales price. The buyer's name was John Richards. Meanwhile, Peggy Holloway became interested in the property after seeing Respondent's advertisement. Ms. Holloway contacted Respondent at the number referenced in the advertisement. Subsequently, she met Respondent at the property. At that time Respondent's broker's license was inactive. Ms. Holloway made an offer on the property. In order to make a commission or profit on the sale, Respondent decided to sell the property to her. He changed the existing contract by marking through Mr. Richard's name and adding Ms. Holloway's name as the buyer. Respondent changed the sales price on the contract to $23,000. On April 27, 1997, Ms. Holloway signed the contract as the buyer. That same day, Mr. Berry signed the contract as seller. As part of the contract, and pursuant to Respondent's instructions, Ms. Holloway made a check out to Respondent, personally, in the amount of $500. Respondent assured Ms. Holloway that he would place the money in an escrow account. The contract stated that the $500 deposit would be held in escrow. Respondent did not place Ms. Holloway's money in escrow. He cashed her check and kept the $500. At all times material to the transaction Ms. Holloway believed that Respondent was a licensed real estate broker. Additionally, the contract contained language stating that Respondent was a real estate broker. During subsequent conversations with Ms. Holloway about financing arrangements for the purchase of the property, Respondent appeared drunk. As a result of those conversations, Ms. Holloway became suspicious about Respondent's intentions and his competence to handle the real estate transaction. Ms. Holloway contacted Petitioner and learned that Respondent's license was inactive. On or about May 6, 1997, Ms. Holloway telephoned Respondent. She told him that she did not want to go through with the contract. She demanded that Respondent return her $500 deposit. Respondent failed to return Ms. Holloway's $500 deposit. Ms. Holloway then began to deal with Respondent's brother, Peter Niles, who is an attorney. Respondent's brother prepared a document for Mr. Berry to sign acknowledging receipt of the $500 deposit. Mr. Berry signed the document prepared by Respondent's brother even though Respondent never gave the $500 deposit to Mr. Berry. Ms. Holloway eventually decided to deal directly with Mr. Berry. They agreed on a sale price and closed the transaction with no assistance from Respondent, his brother, or any other individual. Ms. Holloway sued Respondent in the County Court of Volusia County, Florida. In Case No. 97-31586, the County Judge entered a judgment against Respondent in favor of Ms. Holloway. Respondent had not satisfied the judgment as of the date of the formal hearing.
Recommendation Based upon the findings of fact and conclusions of law, it is RECOMMENDED: That Florida Real Estate Commission enter a final order suspending Respondent's license for a period of ten years and requiring him to pay a fine in the amount of $1,000 within one year of the date of the final order. DONE AND ENTERED this 15th day of June, 1999, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 15th day of June, 1999. COPIES FURNISHED: Laura McCarthy, Esquire Department of Business and Professional Regulation 400 West Robinson Street Orlando, Florida 32802 Phillip F. Niles 5747 Sweetwater Boulevard Port Orange, Florida 32127 Phillip F. Niles Apartment 503 100 Seabreeze Avenue Daytona Beach, Florida 32118 Herbert S. Fecker, Division Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street Orlando, Florida 32802-1900 William Woodyard, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue The issue in this case is whether Respondents are guilty of violating Section 475.25(1)(b) and, if so, what penalty should be imposed.
Findings Of Fact Respondent Galdo has been a licensed real estate broker for eight years and holds license number 0414542. At all material times, he served as president of Respondent Real Estate Support and Development Corporation, which is registered as a real estate broker and holds license number 0243131. All references below to "Respondent" are to Respondent Galdo only. By Contract for Sale and Purchase executed by both parties on December 5, 1989, Respondent, as trustee, agreed to sell to Ruben P. Chalarca a parcel located at 12 Sandalwood Court, Oviedo, Florida. The contract calls for a closing on or before December 28, 1989. The purchase price disclosed on the contract is "approx. 46,300.00 1000.00 cash to Mortgagee." According to the contract, payment was to include the buyer taking subject to and assuming a mortgage held by "Central Fed Mortgage Co." in the approximate principal amount of $45,300. The contract contains no information as to a brokerage commission. Blanks on the form contract concerning a commission are filled in "N/A." The only involvement of Respondent Real Estate Support and Development Corporation appears to be that Respondent provided Mr. Chalarca a business card bearing the name of Respondent, the name of Respondent Real Estate Support and Development Corporation, the company's address, and telephone numbers for Respondent and the company. However, the evidence does not establish that Respondent gave the business card to Mr. Chalarca for any purpose other than giving him the information necessary to contact Respondent. There is no evidence that Respondent held himself out as representing Real Estate Support and Development Corporation in his dealings with Mr. Chalarca. The $1000 earnest money deposit that Mr. Chalarca "paid" to Respondent was by a check that never cleared. Mr. Chalarca gave another check payable to Respondent individually. The second check was dated December 5, 1989, but was only in the amount of $400. There is another check dated December 5 payable to cash and in the amount of $150, but the record does not establish that the Chalarcas gave this sum to Respondent. Except for the $1000 earnest money check, all of the Chalarcas' checks cleared. The closing took place and Respondent Galdo, as trustee, conveyed the property by deed to Mr. Chalarca and possibly his wife. Mr. and Mrs. Chalarca are from Columbia, South America. Neither has had any significant real estate experience prior to the subject transaction with Respondent. Although Mr. Chalarca speaks and understands English reasonably well, his wife does not. Mr. Chalarca did not complete high school. Prior to or at the closing, Respondent told Mr. Chalarca to make the mortgage payments to Respondent, who would make arrangements with the mortgagee, evidently to show that the Chalarcas would be making the mortgage payments. It appear that the mortgage payments may not have been current when the Chalarcas purchased the property. Respondent admitted to Petitioner's investigator that he sent the November and December, 1989, payments to the mortgagee in January, 1990, together with a request that the mortgage be transferred to the Chalarcas. He also admitted that the bank returned the package with a demand for the January, 1990, payment. Upon receipt of the demand from the bank, Respondent told the Chalarcas that they must make the January, 1990, payment at that time. However, the record establishes that the Chalarcas gave Respondent only two checks after the closing. The first is dated April 17, 1990, and in the amount of $1600. The second check is dated May 21, 1990, and in the amount of $1000. The record does not clearly establish whether Respondent ultimately made the November and December, 1990, payments. The record clearly establishes that no one made the January, February, and March payments, although there is no evidence that the Chalarcas ever tendered these payments to Respondent. For reasons not apparent from the record, Mr. Chalarca decided to make the April, 1990, payment directly to the mortgagee. This check is dated April 7, 1990, in the amount of $1220, and payable to Transohio Savings. However, the mortgagee returned the check by letter dated May 29, 1990, because the loan was already in foreclosure. The letter gave Mr. Chalarca an address to contact "in order to stop the action." Most important, the record establishes that Respondent retained the $2600 paid to him by the April and May, 1990, checks, and the record does not establish any justification for the retention of this money by Respondent. There is no indication in the record that Respondent applied this money on behalf of the Chalarcas. To the contrary, there is some indication that no payments were made on the mortgage after late 1989. By Summary Final Judgment of Foreclosure entered November 6, 1990, Transohio Savings Bank, F.S.B. obtained a foreclosure judgment on the subject mortgage against Mr. Chalarca and his wife for the total sum of $52,613.74. The foreclosure judgment shows interest on the principal balance of $5649.24 through September 23, 1990, with an additional $15.78 per day interest from September 24, 1990, through the date of entry of the judgment. The assumed interest rate was not the statutory interest rate, which is expressly imposed upon the total due, starting from the date of the judgment. If the daily interest under the foreclosed mortgage were $15.78 daily, then unpaid interest of $5649.24 represents 358 days' interest, which would suggest that no interest payments were made after September or October, 1989. The foreclosure judgment ordered the clerk to sell the property on December 20, 1990. The Chalarcas remained in the 12 Sandalwood Court parcel until about the time of the sale.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that the Florida Real Estate Commission enter a final order dismissing the Administrative Complaint against Real Estate Support and Development Corporation, finding Roger Galdo guilty of violating Section 475.25(1)(b), suspending his license for six months, placing him on probation for 18 months following the end of the suspension, and imposing upon him an administrative fine of $1000. ENTERED this 9th day of September, 1991, in Tallahassee, Florida. ROBERT E. MEALE 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 9th day of September, 1991. APPENDIX TO RECOMMENDED ORDER CASE NO. 91-4449 Treatment of Proposed Findings of Petitioner 1-3: adopted. 4: rejected as irrelevant. 5: adopted. 6: adopted except that the $1000 check was dishonored. 7: adopted. 8: rejected as unsupported by the appropriate weight of the evidence. All of the checks that the Chalarcas gave Respondent have been identified in the recommended order., which also identifies when these checks were delivered to Respondent. The evidence does not establish by the requisite standard that the Chalarcas gave Respondent the mortgage payments each month when they were due, or even that they gave Respondent funds sufficient to make the mortgage payments that fell due following the closing. 9: adopted except as the characterization of Mr. Chalarca as "suspicious." The characterization is rejected as unsupported by the appropriate standard of evidence. 10: adopted. 11: rejected as unsupported by the appropriate weight of the evidence. The record does not establish Mr. Chalarca's motivation for giving Respondent the two checks totalling $2600. 12: adopted, although a substantial amount of time elapsed between the service of the foreclosure summons and the departure of the Chalarcas from the mortgaged property. 13: adopted. 14: rejected as unsupported by the appropriate weight of the evidence. 15-19: rejected as recitation of evidence. COPIES FURNISHED: Darlene F. Keller Division Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, FL 32801 Attorney Janine B. Myrick Division of Real Estate Legal Section P.O. Box 1900 Orlando, FL 32802-1900 Roger Galdo 208 Madeira Avenue Orlando, FL 32825 Jack McRay, General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, FL 32399-0792
Findings Of Fact William J. Francis, Respondent, is now, and was at all times alleged in the Administrative Complaint, a licensed real estate broker in the State of Florida, having license No. 0388666. Respondent, V R Business Brokers of Lakeland, Inc., is currently, and was at all times alleged in the Administrative Complaint, a real estate broker corporation, having been issued license No. 0224405. At all times alleged in the Administrative Complaint, Respondent Francis was licensed and operating as a real estate broker and sole qualifying broker and officer of Respondent, V R Business Brokers of Lakeland, Inc. Respondent, via Theresa Rosalie Francis, a broker/salesman and wife of Respondent, employed by V R Business Brokers, obtained from Joyce Houser a listing agreement (Exhibit 1) to sell a restaurant called "Bac O' The Mall at a price of $43,000. This listing agreement provided a minimum commission of $6,000 to the broker. Subsequent to obtaining the listing agreement, another employee of V R Business Brokers, James Rice, a real estate salesman, obtained a written offer to purchase "Bac O' The Mall" on January 13, 1983 (Exhibit 2). This offer was made by Robert Stevens and Richard Destin to purchase the business for $30,000, with a $500 deposit and an additional $1,500 down payment when the seller accepted the offer and the balance of $28,000 at closing. Joyce Houser was advised the offer had been received and was requested to come down to Respondent's office to have it presented. Mrs. Houser went to the office of Respondent and was quite upset with the disparity in asking price and the offer. Salesman Rice, who had obtained the offer, urged Mrs. Houser to accept the contract immediately because the business had been losing money and a better offer might not be forthcoming. Mrs. Houser refused this offer and contacted her brother, a real estate broker, who helped her prepare a counteroffer. Prior to this offer being submitted, Mrs. Houser had become unhappy with her dealings with V R Business Brokers due to salesmen bringing clients in at inopportune times to show the business and for failing to maintain secrecy with respect to her employees of the fact that the business was for sale. A prior offer had also been obtained on which Mrs. Houser felt she had been pressured by Respondent to accept; and she had directed all negotiations to be made through her brother, Charles Whitten. The buyers accepted the counteroffer (Exhibit 7) When the counteroffer was accepted, Whitten reminded Respondent that the additional $1,500 was due. When the buyers did not appear the following day with the additional deposit, Respondent, who had agreed to hold the buyers' personal check for $500 to be replaced with a cashier's check for $2,000, apparently became suspicious of the buyers' ability to pay and called the bank on which the check had been written to find out if sufficient funds were on deposit to cover the check. When advised that there were insufficient funds to cover the check, Respondent sent the check to his escrow agent to have the check sent to the bank where, in fact, it was subsequently dishonored. Respondent never advised Mrs. Houser or Charles Whitten that the $500 check bounced or that the buyers had failed to deposit the additional $1,500 required by the contract until after the scheduled date of closing. A few days before the February 15, 1983, scheduled closing date Respondent or his salesman contacted Whitten to solicit Mrs. Houser to finance part of the purchase price. She declined to do so. At the time the initial contract was submitted by Destin and Stevens, Respondent knew these buyers were unemployed engineers and soon thereafter learned they were attempting to borrow the money to finance the deal, and that the banks would not lend them the money they needed. Nevertheless, Respondent attempted to induce the seller to finance the sale of the business when he knew, or should have known, the buyers to be sufficiently poor credit risks they could not obtain financing. When February 15, 1983, passed without the scheduled closing taking place by reason of default on the port of the buyers, Mrs. Houser, on February 18, 1983, wrote to Respondent (Exhibit 5) requesting the earnest money deposit as liquidated damages and a release from the listing agreement which she had been promised. In response thereto, Respondent, by letter dated February 24, 1983 (Exhibit 6), advised Mrs. Houser that the buyers' $500 check was no good and that they had failed to put up the additional $1,500 required by the contract. He agreed to cancel the listing agreement `as soon as this matter is resolved." Mrs. Houser then reported the entire transaction to the Florida Real Estate Commission and these proceedings followed their investigation.
Findings Of Fact At all times relevant hereto, respondent, George Sherbon, was a licensed real estate broker having been issued broker's license number 0348688 by petitioner, Department of Professional Regulation, Division of Real Estate (Division). When the events herein occurred, respondent was employed as a salesman for V. P. Stone, Inc., a real estate firm located at 5905 Gulf Boulevard, St. Petersburg Beach, Florida. On April 1, 1987, Paul D. and Anna Martin entered into a listing agreement with Century 21 Spinning Wheel Ent., Inc. (Century 21) to sell their home at 2543 58th Terrace South, St. Petersburg, Florida. The listing agent was Cheryl Coudry, now known as Cheryl Hutton, a licensed salesperson with Century 21. On September 11, 1987 respondent solicited and obtained a contract for sale on the Martin property executed by Frank Dicenzo, a resident of Pittsburgh, Pennsylvania, who had a daughter living in the St. Petersburg area. Dicenzo had responded to an advertisement run by Sherbon in a Pittsburgh newspaper. After a week or so of negotiations, the parties eventually agreed to a sales price of $92,500, and the final contract was executed on September 20, 1987. The contract called for Dicenzo to make an initial $100 deposit when the contract was executed and an additional deposit of $19,900 by September 25, 1987, or a total deposit of $20,000. Dicenzo gave respondent the initial $100 which was deposited into the escrow account of V. P. Stone, Inc. The contract provided further that the sale would be contingent on Dicenzo obtaining a $72,500 first mortgage. Finally, in accordance with Dicenzo's request, the contract provided that Dicenzo could take occupancy of the premises four weeks after the loan was approved. It is noted that Dicenzo initially asked for occupancy by October 16, 1987. On September 18, Sherbon introduced Dicenzo to Tony Black, a loan officer at Savings of America, a local lending institution, for the purpose of Dicenzo making a loan application. On September 24, or the day before the additional deposit was due, Dicenzo became ill with what he described as a bleeding ulcer and decided to return to Pittsburgh and stay at his mother's home. Before he left, Dicenzo did not make the additional deposit as required by the contract. According to Dicenzo, he placed no great significance on the September 25 due date and felt that if the deposit was made "within a reasonable time," it would be okay. Respondent was aware of the September 25 deadline and attempted to get a check for the $19,900 deposit from Dicenzo's daughter but was unsuccessful. Respondent contends he kept trying to contact Dicenzo in Pittsburgh during the next five week period but was unable to reach him. Dicenzo acknowledged he knew that Sherbon was trying to contact him but still made no effort to talk to Sherbon. Instead, he simply told his daughter he would take care of the matter when he returned to Florida in late October. Whether this message was conveyed to Sherbon is not of record. Sherbon prepared contemporaneous notes concerning the transaction and used these to refresh his recollection at hearing. He pointed out that such notes were kept on all real estate transactions. According to his notes, he telephoned Coudry and Black on September 24 concerning Dicenzo's illness and the fact that he was having difficulty obtaining the additional deposit from Dicenzo. Although Black recalled talking with Sherbon, he denied that Sherbon told him that there was no deposit and said such information was a material item that would have prompted him to stop processing the application until the deposit could be verified. Likewise, Coudry, who could not recall many aspects of the transaction, did recall speaking with Sherbon but remembered Sherbon simply telling her that he was in the process of showing Dicenzo various commercial properties and would be obtaining the deposit at that time. Their testimony is deemed to be more credible and persuasive and is hereby accepted. Coudry assumed that Sherbon had received the additional deposit since she was never specifically told otherwise by Sherbon. Accordingly, she did not contact the Martins until several weeks after the September 25 due date. Coudry did not learn that no deposit had been collected until mid-January 1988 when Anna Martin disclosed to her this fact. In the meantime, although the Martins knew the contract was contingent on Dicenzo obtaining a loan, they nonetheless assumed that Dicenzo would have no problem securing a loan and that such a loan would be approved in a week or so. Also, they knew the contract called for possession of the property by Dicenzo four weeks after the loan was approved. Because of these assumptions, and having received no advice from Coudry that the full deposit had not been made on September 25 as required by the contract, the Martins made application around September 28 to buy another home in a nearby modular home park and asked that the application be expedited. Unfortunately for the Martins, they were far more successful than Dicenzo in securing prompt approval of their loan application. Once approved, and after a closing was held, the Martins had the utilities hooked up, erected a storage shed, and incurred other expenses. Also, they began making mortgage payments on the second house. On October 24, 1987 the Martins telephoned Sherbon and told him their listing with Century 21 had expired. During the conversation, Sherbon did not mention that Dicenzo had failed to make the $19,900 deposit. Dicenzo's application with Savings of America was denied on October 30, 1987 because of Dicenzo's "ratio of ... expenses to ... total income." By this time, Dicenzo had returned to Florida and had spoken with Sherbon. At respondent's urging, Dicenzo reapplied to the same institution and was turned down a second time on November 12, 1987. In addition, at Coudry's suggestion, Dicenzo had already visited another lender in October but refused to pay a $250 application fee and consequently did not file an application. Also, through Sherbon, Dicenzo was given the name of a mortgage lender suggested by the Martins but, after three visits, decided not file an application. Information regarding the second Savings of America denial was conveyed to Coudry around mid-November but, for whatever reason, she did not contact Sherbon regarding the status of the contract. It is noteworthy that at that time Sherbon did not tell Coudry that Dicenzo had still failed to make an additional deposit as required by the contract. Despite the loan application denials, Sherbon encouraged Dicenzo to keep trying to arrange financing so that the deal could go through. Dicenzo agreed to do so but, as noted in the following finding of fact, at that point Dicenzo considered the contract to be "null and void." Sherbon's efforts to find financing continued until mid-January 1988. When the loan application was denied on November 12, Dicenzo construed the contract to be void since the financing contingency was not met. According to Dicenzo, he did not believe the property was tied up while his contract was pending, felt no obligation to make the $19,900 deposit because it meant he would have to transfer funds from a money market account he purportedly maintained in Pittsburgh, and felt no moral obligation to the Martins even though by then they had committed themselves to a second home. The Martins were advised by telephone on the evening of November 12 of the second turn down of Dicenzo's loan application. By then, however, they were already committed to the second purchase. They claimed they did not learn of Dicenzo's failure to make the $19,900 deposit until mid-January 1988 when Sherbon visited their home and disclosed this fact. This is also borne out by a letter from the Martins' attorney to Dicenzo on December 1, 1987 advising Dicenzo that the contract was void and a claim might be made on his deposit for damages. When the Martins learned that only $100 had been deposited, they filed a complaint with the Division. That prompted this proceeding. Because of the failed contract, the Martins were unable to maintain two mortgage payments and were ultimately forced to give up the second home at a substantial monetary loss. They have since returned to their first home. The evidence shows that in the real estate trade, it is not customary or proper for the buyer's realtor to personally contact the seller. Rather, the practice and custom is for the buyer's agent to advise the listing broker of all pertinent developments and the listing broker then relays any necessary information to the seller. Thus, Sherbon had no responsibility to personally advise the Martins of any information pertaining to the contract. Rather, this responsibility rested with Coudry. Respondent contended he kept Coudry abreast of all developments concerning Dicenzo and that he assumed Coudry would advise the Martins that no deposit had yet been collected. To the extent this version of events conflicts with previous findings, it is not accepted. Sherbon expressed sympathy for the Martins' plight but maintained he was not at fault. There is no evidence that Sherbon has been subjected to prior disciplinary action by the Division.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent be found guilty of violating Subsection 475.25(1)(b), Florida Statutes (1987) to the extent noted in the conclusions of law and that his broker's license be suspended for three months. All other charges should be dismissed. DONE and RECOMMENDED this 26th day of April, 1989, in Tallahassee, Florida. DONALD R. ALEXANDER 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 26th day of April, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO. 88-4688 Petitioner: 1-2. Covered in finding of fact l. Rejected as being unnecessary. Covered in finding of fact 2. 5-7. Covered in finding of fact 3. Covered in finding of fact 5. Covered in finding of fact 10. Covered in finding of fact 7. Rejected since respondent owed a duty to Coudry, and not the Martins, to keep her abreast of all pertinent matters. Covered in findings of fact 7 and 12. Covered in findings of fact 7 and 8. Covered in finding of fact 8. Covered in findings of fact 6 and 10. Rejected as being subordinate to other findings. Covered in finding of fact 11. 18-19. Covered in finding of fact 6. Respondent: Respondent's proposed order contains sections entitled "admitted facts", "unrebutted facts" and "uncontested facts". They are ruled upon in that order. Admitted facts: Covered in finding of fact l. Covered in finding of fact 3. Covered in finding of fact 2. Covered in finding of fact 3. Covered in finding of fact 3. Covered in background. Unrebutted facts: Covered in finding of fact 7. Covered in finding of fact 15. Covered in finding of fact 10. 4-6. Covered in finding of fact 6. 7-8. Covered in finding of fact 5. Covered in finding of fact 11. Covered in finding of fact 12. Rejected since Sherbon learned of the loan denial even though he did not receive a written copy of the turn-down letter. Covered in finding of fact 13. Covered in finding of fact 8. Rejected since the testimony of Anna Martin is accepted as being more credible on this factual issue. Uncontested facts: Rejected as being cumulative. Partially covered in findings of fact 6, 7 and 16. The remainder is rejected as being cumulative, argument of counsel or not supported by the more credible evidence. COPIES FURNISHED: James H. Gillis, Esquire Post Office Box 1900 Orlando, Florida 32802 Daniel B. Schuh, Esquire 248 Mirror Drive St. Petersburg, Florida 33701 Darlene Keller, Director Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Kenneth E. Easley, Esquire 130 North Monroe Street Tallahassee, Florida 32399-0750 =================================================================
Findings Of Fact The testimony revealed that during late December, 1975, Land Re-Sale Service, Inc., a Florida Corporation, filed application with the Florida Real Estate Commission seeking registration as a corporate real estate broker. The application revealed that Defendant Frank Viruet (FREC Progress Docket 2856) was to become the Active Firm Member Broker, and Vice President of the company; that Carol Bauman was to become Secretary-Treasurer and Director of the company; that Lee Klein was to become President and Director of the company. Testimony shows that Carol Bauman is the wife of Defendant Bernard Bauman (Progress Docket 2857); that Lee Klein is the sister of Carol Bauman and that Jeffrey Bauman (FREC Progress Docket 2858) is the son of Bernard Bauman. Subsequent to filing said corporate application For registration with the Commission, evidence reveals that the name was changed to Noble Realty Corporation and shortly thereafter to Deed Realty, Inc. and that along with each change, a new application For corporate registration was later filed with the commission. It was noted that the stated officers and active firm members broker remain as stated in the initial corporate application For registration. Thus, it can be concluded For all legal purposes that the above corporate entities are one and the same. Count I of the Administrative Complaint filed herein, reveals that according to the certificate filed with the Commission's chairman dated December 3, which was offered into evidence by Plaintiff and admitted, during the period November 1, 1975 to the date of said certificate, i.e., December 3, 1976, which covers all dates material to the complaint herein, no registration was issued to or held by either of said corporations, Land Re-Sale Service, Inc., Noble Realty Corporation or Deed Realty, Inc. This was further confirmed by the testimony of Bernard Bauman who was to have become a salesman associated with the above entities and by Frank Viruet, who was to have become the active firm member broker For the above entities. Approximately December 2, 1975, Land Re-Sale Service, Inc. entered into a written lease For office premises known as Room 212, Nankin Building, 16499 N.E. 19th Avenue, North Miami Beach, Florida For the period January 1 through December 31, 1976 (A copy of the lease was entered into evidence by stipulation.) The unrebutted testimony of Plaintiff Reagan reveals that he observed during his investigation of this cause a building directory on the ground entrance floor to the Nankin Building displaying the name Noble Realty, Inc., Room 212 and a similar display on the building directory which was located on the second floor. Plaintiff's witness Peter King, a representative of and For Southern Bell Telephone Company testified that on December 27, 1975, three phones were installed in Room 212 of the Nankin Building in the name of Land Re-Sale Service, Inc. and that from January 2 to January 16, approximately 575 calls were made from the stated phones all during evening hours to out-of-state numbers. Jeffrey Bauman admitted to having made phone calls to out-of-state numbers For purposes of soliciting real estate sales listings, but failed to recall specifically the number of calls nor did he have records to substantiate this fact. Bernard Bauman testified that from such solicitations, approximately 4 listings were obtained accompanied by an advance fee of $375.00 For each listing. When he was advised by the Commission's Investigator that the operation they were conducting was in violation of the licensing law by reason that no registration had been issued to the company and that all who are engaged in real estate activities therein were in violation of the license law (Chapter 475, F.S.) the premises were closed and all real estate activities ceased. This was further confirmed and unrebutted by plaintiff Reagan. As to Count II, the evidence established that, as stated above, the Defendants Bernard and Jeffrey Bauman had solicited real estate sales listings with representations to out-of-state property owners that listings would in fact be published and disseminated to brokers nationwide. Both Jeffrey and Bernard Bauman admitted that their listings were never published or otherwise disseminated to brokers. Bernard Bauman's testimony reveals that no monies received were returned to senders. There is no evidence introduced to show that Defendant Jeffrey Bauman knew, at the time of soliciting, that no bona fide efFort would be made to sell the property so listed with Noble Realty Corporation. As to Count III, plaintiff alleges that the above acts as set Forth above established a course of conduct by defendant upon which his revocation or registration should issue.
