Findings Of Fact Respondents Phillip A. Banks (Banks) was at all times Material hereto a licensed real estate broker in the State of Florida, having been issued license number 0324865. Banks was the qualifying broker for Respondent, Abode Realty, Inc., which was at all tines material hereto registered as a real estate broker in the State of Florida, having been issued license number 0232550. On August 24, 1985, Respondents received in escrow $2,200 from Patricia Turner, as a deposit on her agreement to purchase a home located at 1300 Westview Drive, Miami, Florida. Pertinent to this case, the agreement was conditioned on Ms. Turner's ability to qualify for and obtain a first mortgage, insured by the FHA or guaranteed by the VA, in an amount not less than $40,837. Ms. Turner's application for the subject mortgage was duly submitted to American International Mortgage Company (American International). That application was, however, denied because the property did not appraise at the contract price. Following the denial of her application for mortgage financing on the first house, Ms. turner entered into an agreement through Respondents, dated November 20, 1985, to purchase another home located at 2501 Northwest 155 Terrace, Miami, Florida. At that time, Respondents returned to Ms. Turner the $2,200 deposit on the first contract, and she in turn deposited such sums with Respondents as a deposit on her agreement to purchase the second home. Pertinent to this case, the agreement was conditioned on Ms. Turner's ability to qualify for and obtain a first mortgage, insured by the FHA or guaranteed by the VA, in an amount not less than $39,867. The agreement further provided: When this contract is executed by the Purchaser and the Seller and the sale is not closed due to any default or failure on the part of the Purchaser, Purchaser shall be liable to Broker for full amount of brokerage fee. The agreed brokerage fee was 7 percent of the purchase price, or $2,800. The second home was owned by Independent Properties, Inc., a corporation owned, at least in part, by Banks. This ownership interest was, however, fully disclosed to Ms. Turner at the time the agreement was executed. Ms. Turner's application for the mortgage on the second home, as with the first home, was processed by American International. While that loan was being processed, Ms. Turner contracted to purchase and purchased, unbeknown to Respondents or American International, a different home (the third home). When a American International discovered this fact, Ms. Turner's application was disapproved because she lacked sufficient resources to afford two homes and because she could not comply with the FHA regulation which required that the buyer reside in the home. But for Ms. Turner's purchase of the third home, she would have qualified for the mortgage contemplated by the second agreement. Ms. Turner entered into the agreement to purchase the third home on or about January 20, 1986, and her application for the mortgage on the second home was disapproved by American International on April 1, 1986. In the interim, on January 30, 1986, Ms. Turner secured a loan of $1,000 from Banks on the pretext that her uncle had been charged with a criminal offense and the monies were needed to secure his release. The proof established, however, that Ms. Turner had no intention of fulfilling her agreement to purchase the second home, and that the pretext she used to secure $1,000 from Banks was but a subterfuge to secure the return of some of her deposit. Ms. Turner made no demand for the return of any of her deposit monies. She did, however, file a civil action in January 1987 to recover such monies. That action was dismissed on motion of Respondents, but faced with the threat of continued litigation Respondents offered to settle with her for $1,100. Ms. Turner rejected Respondents' offer, and commenced a second civil action. That action resulted in the entry of a final judgment in her favor for $1,100 and costs. Respondents are ready, willing and able to satisfy such judgment, and have attempted to satisfy such judgment through Ms. Turner's counsel without success.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final order be entered dismissing the Administrative Complaint. DONE and ENTERED this 11th day of January 1988, in Tallahassee, Florida. WILLIAM J. KENDRICK 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 a Division of Administrative Hearings this 11th day of January 1988. COPIES FURNISHED: James H. Gillis, Esquire Division of Real Estate Legal Section 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Brian M. Berman, Esquire SMITH & BERMAN, P.A. 2310 Hollywood Boulevard Hollywood, Florida 33020 William O'Neil, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Darlene F. Keller Acting Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802
The Issue The issue presented for decision herein is whether or not Respondent's real estate brokers license should be disciplined because he engaged in acts and/or conduct amounting to fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust, and for failure to account and deliver1 in violation of Subsections 475.25(1)(b) and (d), Florida Statutes.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received and the entire record compiled herein, including post-hearing memoranda, I hereby make the following relevant factual findings: During times material herein, Respondent was, and is, a licensed real estate broker in Florida and has been issued license number 0007278. (Petitioner's Exhibit 1). Maryland Properties, Inc. was a corporation organized under the laws of Florida during times material and incorporated as such on March 24, 1977 and was involuntarily dissolved on November 10, 1983. At times material, Respondent was President of Maryland Properties, Inc. (Petitioner's Exhibit 2). Prior to December, 1980, Mr. and Mrs. Emeterio Padron Cruz were the owners of lots 16 and 17, block 11, of Athol Subdivision, Dade County, Florida. (Petitioner's Exhibit 11) Padron Deposition-Page 5; Petitioner's Exhibits 12-Mrs. Padron Deposition-Pages 2 and 3; Petitioner's Exhibit 3). Mr. and Mrs. Padron were interested in selling lots 16 and 17 and Respondent, in his capacity as real estate broker, sought buyers on behalf of the Padrons. (TR 94). On September 6, 1980, a contract was obtained by the Respondent between Mr. and Mrs. Padron, as sellers, and Roberto Hernandez and/or assigns as buyer. According to the terms of the contract, a real estate commission of $650 was to be paid to Respondent. (TR 97). The transaction between the Padrons as sellers and Roberto Hernandez as buyers did not materialize and instead Respondent, through the entity Maryland Properties, Inc., purchased the property and a closing was held on December 1, 1980. Respondent became interested in the purchase of this property based on a need expressed by the Padrons that they needed to dispose of their property and they wished that Respondent would purchase the property along the same terms as Roberto Hernandez had previously agreed. In this regard, Respondent executed the closing documents as President of Maryland Properties, Inc., the purchaser of the Padron property. The Padrons were aware that Respondent was President of Maryland Properties, Inc., based on their review of the closing documents. Respondent received a $650 commission in his capacity as broker in the Padron to Maryland Properties, Inc. transaction. (Petitioner's Exhibit 13; Petitioner's Exhibit 11-Padron Deposition-Pages 13 and 14). As part of the Padron/Maryland Properties, Inc. transaction, a mortgage dated December 1, 1980 was given back to Padron by Maryland Properties, Inc. for $8,000. The mortgage deed and note were not recorded until March 11, 1981. Respondent prodded the Padrons to record the mortgage and to keep the note in a safe in the event that it was needed later on. Per Respondent's insistence, the Padrons finally recorded the mortgage and note on March 11, 1981. (Petitioner's Exhibit 4). On November 27, 1980, Maryland Properties, Inc., through its President, the Respondent, entered into a contract to sell the same lots (16 and 17) to Agustin R. and Gladys A. Verde (Respondent's Exhibit 1). The Maryland Properties, Inc./Verde transaction closed on February 4, 1981 without the Verdes or their attorney, Antonio Alonso, being aware of the Maryland Properties, Inc. to Padron Mortgage. At no time prior to closing did the Respondent reveal to the Verdes or Mr. Alonso the existence of the mortgage. Mr. Alonso, prior to closing, received and reviewed an abstract on the property which abstract did not contain the mortgage as it could not have since the mortgage was not recorded until subsequent to the Verde closing. Additionally, Respondent executed an affidavit prior to closing wherein it is stated that the property was free and clear of any lien or encumbrance. (Petitioner's Exhibit 15) The closing statement executed by Respondent speaks of a purchase money (first) mortgage, which mortgage was from the Verdes to Maryland Properties, Inc. (Petitioner's Exhibits 4, 5, 8, 14, 15; TR 70-77). Respondent, as President of Maryland Properties, Inc., failed to make the final mortgage payment of $4,000 to Padron when same became due on December 2, 1982. Padron foreclosed on the mortgage which action was initiated on December 1, 1983. Respondent entered a settlement to the foreclosure action and paid the mortgage deficiency, however, there remains outstanding an award for attorneys fees for the foreclosure action in favor of the Padron's attorney (Louis Sabatino).
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Respondent 's license number 0007278 be suspended for a period of six (6) months. RECOMMENDED this 27th day of May, 1986, in Tallahassee, Florida. JAMES E. BRADWELL, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of May, 1986.
The Issue The issues are whether the respondents violated Subsection 494.004(1), Florida Statutes (2001),1 by failing to file a written report with Petitioner that Bill Negron’s (Mr. Negron) real estate license had been permanently revoked for fraud and dishonest dealing, and, if so, what penalties, if any, should be imposed against the mortgage broker licenses of Mr. Negron and First American Mortgage & Financial Center, Inc. (First American).
Findings Of Fact Petitioner is the state agency charged with the responsibility for enforcing and administering the provisions of Chapter 494. Mr. Negron is licensed as a mortgage broker in the state. First American was licensed as a mortgage brokerage business in the state, but First American terminated its license on April 29, 2008. Mr. Negron is president, principal broker, and 100 percent owner of First American. First American is subject to disciplinary action for any statutory violations committed by Mr. Negron. On April 17, 2002, the Florida Real Estate Commission (FREC) found Mr. Negron guilty of fraud; dishonest dealing by trick, scheme or device; culpable negligence; or breach of trust in any business transaction in Final Order BPR-2002-01624. The Final Order found the licensee had failed to account or deliver funds and failed to maintain trust funds in the real estate brokerage escrow account. The FREC Final Order permanently revoked Mr. Negron’s real estate license. The Final Order found that the licensee was guilty of a course of conduct or practices that show the money, property, transactions, and rights of investors may not be safely entrusted to the licensee. Each of the respondents had a statutory duty to notify Petitioner of the revocation order issued by FREC. The duty ensures that Petitioner will have an opportunity to make an independent determination of whether a licensee is continuously qualified for licensure as a mortgage broker. Neither of the respondents notified Petitioner of the revocation order by FREC. Mr. Negron had been licensed as a mortgage broker from December 22, 2003. Professional training included specific training pertaining to the requirement to report regulatory actions for fraud, dishonest dealing, and moral turpitude to Petitioner. The licensee knew, or should have known, from pre-licensing and continuing education courses, of the requirement to notify Petitioner of the revocation of his real estate license. Petitioner did not have actual knowledge of the disciplinary action against Mr. Negron from other public records. Petitioner does not share databases with FREC. Testimony from Petitioner’s witness that it would have been virtually impossible for Petitioner’s employees to unilaterally uncover the existence of the revocation order was credible and persuasive to the trier of fact. Mr. Negron testified that he dictated a notification letter to his secretary and assumed she mailed it to Petitioner. The trier of fact finds that testimony to be neither credible nor persuasive. The record of the FREC proceeding evidences multiple offenses over a period of time that represent prior disciplinary history which preceded the revocation order by FREC. The prior disciplinary history on which FREC relied is evidenced in this record. However, no finding is made based on that evidence because the prior disciplinary history is not alleged as a factual basis for the proposed agency action in this proceeding in either the Administrative Complaint or the Amended Administrative Complaint. The only relevant finding in this proceeding, based on the prior disciplinary history in the FREC proceeding, is that neither of the respondents notified Petitioner of the prior disciplinary history with FREC. The failure to notify Petitioner of the prior disciplinary action by FREC is consistent with the failure of the respondents to notify Petitioner of the entry of a revocation order by FREC and is considered solely for the purpose of determining the credibility of the testimony presented by the respondents.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order permanently revoking the mortgage broker’s license of the two respondents. DONE AND ENTERED this 30th day of October, 2009, in Tallahassee, Leon County, Florida. S DANIEL MANRY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of October, 2009.
Findings Of Fact At all times relevant hereto, Petitioner was licensed as a real estate broker by the Florida Real Estate Commission. In May 1988, he was working as a broker-salesman with G.V. Stewart, Inc., a corporate real estate broker whose active broker is G.V. Stewart. On April 20, 1989, Respondent submitted a Contract for Sale and Purchase to the University of South Florida Credit Union who was attempting to sell a house at 2412 Elm Street in Tampa, Florida, which the seller had acquired in a mortgage foreclosure proceeding. This offer reflected a purchase price of $25,000 with a deposit of $100 (Exhibit 2). The president of the seller rejected the offer by striking out the $25,000 and $100 figures and made a counter offer to sell the property for $29,000 with a $2000 deposit (Exhibit 2). On May 9, 1989, Respondent submitted a new contract for sale and purchase for this same property which offer reflected an offering price of $27,000 with a deposit of $2000 held in escrow by G.V. Stewart (Exhibit 3). This offer, as did Exhibit 2, bore what purported to be the signature of William P. Murphy as buyer and G. Stewart as escrow agent. In fact, neither Murphy nor Stewart signed either Exhibit 2 or Exhibit 3, and neither was aware the offers had been made at the time they were submitted to the seller. This offer was accepted by the seller. This property was an open listing with no brokerage firm having an exclusive agreement with the owner to sell the property. Stewart's firm had been notified by the seller that the property was for sale. Respondent had worked with Stewart for upwards of ten years and had frequently signed Stewart's name on contracts, which practice was condoned by Stewart. Respondent had sold several parcels of property to Murphy, an attorney in Tampa, on contracts signed by him in the name of Murphy, which signatures were subsequently ratified by Murphy. Respondent considers Murphy to be a Class A customer for whom he obtained a deposit only after the offer was accepted by the seller and Murphy confirmed a desire to purchase. Respondent has followed this procedure in selling property to Murphy for a considerable period of time and saw nothing wrong with this practice. At present, Respondent is the active broker at his own real estate firm.
Recommendation It is RECOMMENDED that William H. McCoy's license as a real estate broker be suspended for one year. However, if before the expiration of the year's suspension Respondent can prove, to the satisfaction of the Real Estate Commission, that he fully understands the duty owed by a broker to the seller and the elements of a valid contract, the remaining portion of the suspension be set aside. ENTERED this 29th day of November, 1989, in Tallahassee, Florida. K. N. AYERS 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 29th day of November, 1989. COPIES FURNISHED: John Alexander, Esquire Kenneth E. Easley 400 West Robinson Street General Counsel Orlando, Florida 32802 Department of Professional Regulation William H. McCoy 1940 North Monroe Street 4002 South Pocahontas Avenue Suite 60 Suite 106 Tallahassee, Florida 32399-0792 Tampa Florida 33610 Darlene F. Keller Division Director 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 =================================================================
The Issue The Administrative Complaint presents essentially the same factual allegations in its various counts supporting different legal violations. These factual allegations are summarized as follow: Reinlie represented to Estelle Pitts that if she put up the earnest money deposit for her son, William Lambert, on the commercial property that Lambert wanted to purchase in the form of notes secured by mortgages on her house: (1) the mortgages and notes would not be a lien on her property; (2) the mortgages and notes would not be recorded; (3) the mortgages and notes would be returned to her when Lambert obtained financing for the property he desired to purchase; (4) the mortgages and notes merely showed good faith on Lambert's part regarding his offer to purchase; (5) Lambert's contract for purchase was contingent upon the sale of commercial property which he owned in South Florida; and (6) even if the sale to Lambert did not go through, Mrs. Pitts would not be responsible for the mortgages and notes. Contrary to his representations, Reinlie recorded the various mortgages and notes executed by Estelle Pitts. Contrary to his representations, Reinlie advised Estelle Pitts that she would be responsible for the mortgages and notes, and that if said notes were not satisfied "foreclosure proceedings would be initiated." Petitioner called Estelle Pitts, who testified concerning the representations made by Reinlie. Reinlie testified, denying that he had made said representations. William Lambert was the only other person present when most of these alleged representations were made. Lambert, who had suffered a physically debilitating stroke, could not attend the hearing, and his deposition was received into the record. Lambert's recollection of the events was wholly supportive of neither his mother's nor Reinlie's recollection of the events. None of the witnesses were disinterested: Reinlie's license was in jeopardy; Mrs. Pitts' home was in jeopardy; and Lambert is Mrs. Pitts' son. The conflicts in testimony can only be resolved from extrinsic facts and the credibility of the witnesses. Having considered the facts, the testimony of Reinlie is deemed more credible. Both parties submitted post hearing proposed findings of fact in the form of a proposed recommended order. To the extent the proposed findings of fact have not been included in the factual findings in this order, they are specifically rejected as being irrelevant, not being based upon the most credible evidence, or not being a finding of fact.
Findings Of Fact The following Findings of Fact are based upon the prehearing stipulation of the parties: At all times in question, the Respondent, James Reinlie, Jr., was a registered real estate broker in the State of Florida and is the holder of license number 0112757. The parties were duly noticed pursuant to the provisions of Chapter 120, Florida Statutes (1981). William C. Lambert, Estelle Pitts' son, did not have the necessary money with which to furnish a deposit to the sellers of the Robin Hood Motel at the time the contract for sale and purchase and the addendums thereto were executed. A contract for sale and purchase was executed on August 11, 1979, and August 13, 1979, between Irene B. Smith, seller, and William C. Lambert, Sr., buyer, for the purchase of the Robin Hood Motel, located at 1150 North Atlantic Avenue in Daytona Beach, Florida. Respondent Reinlie was a co-broker on that contract. On August 13, 1979, an addendum to the contract for sale and purchase was executed between Irene B. Smith, seller, and William C. Lambert, Sr., buyer. On January 7, 1980, and January 8, 1980, a second addendum was executed under the original contract for sale and purchase between Irene B. Smith, Gilbert Brown and Liselotte M. Brown, sellers, and William C. Lambert, Sr., buyer. On August 13, 1979, a mortgage deed and mortgage note were executed by Estelle Pitts and Linda L. Smith (Mrs. Pitts' daughter) as mortgagor, to B.I.C. Realty, Inc., escrow account, as mortgagee, said note in the principal amount of $5,000 and secured by a first mortgage on 900 West New York Avenue, Deland, Florida, also known as: . . . the east 60' of the north 150' of Lot 1, Block I, Stetson Home Estates MB 10, page 79, Volusia County, Florida; Said property is the residential home of Estelle Pitts with title in the names of Estelle Pitts and Linda L. Smith. On October 16, 1979, a second mortgage was executed by Estelle Pitts and her daughter, Linda L. Smith, dated November 1, 1979, and secured by a mortgage note in the amount of $5,000 on the residential home of Estelle Pitts, said property being described in detail in paragraph 7 above. On October 16, 1979, a third mortgage was executed by Estelle Pitts and her daughter, Linda L. Smith, dated November 1, 1979, and secured by a mortgage note in the amount of $5,000 on the residential home of Estelle Pitts, said property being described in detail in paragraph 7 above. On August 17, 1979, Respondent Reinlie took the first mortgage deed and mortgage note to The Abstract Corporation and instructed that it be recorded in the public records of Volusia County, Florida, said first mortgage deed and mortgage note in the amount of $5,000 dated August 11, 1979, and executed August 13, 1979. On November 29, 1979, Reinlie took the second mortgage deed and note to The Abstract Corporation and instructed that it be recorded in the public records of Volusia County, said second mortgage deed and note in the amount of $5,000 dated November 1, 1979, and executed October 16, 1979. On December 4, 1979, Reinlie took the third mortgage deed and note to The Abstract Corporation and instructed that it be recorded in the public records of Volusia County, said third mortgage deed and note in the amount of $5,000 dated December 1, 1979, and executed October 16, 1979. On May 2, 1980, Estelle Pitts notified Reinlie that she wanted the aforesaid mortgages and notes returned to her immediately. On May 14, 1980, Reinlie notified Mrs. Pitts that he would not return the mortgages and notes and had been advised by the "former" owners of the Robin Hood Motel that they desired to pursue their full deposit, plus expenses, under the contract and, if necessary, would foreclose the mortgages and notes in order to enforce their legal rights. On May 19, 1982, Reinlie executed three satisfactions of mortgages on the three mortgages and notes referred to in paragraphs 7, 8 and 9 above upon the advice of counsel. The following Findings of Fact are based upon testimony and evidence adduced at the hearing: Reinlie did not state to Mrs. Pitts that the mortgages would not be recorded and would not be a lien on her property. (See Lambert deposition, pages 11 and 12.) William Lambert was aware that the mortgages and notes were to be recorded and would be a lien on his mother's property. Mrs. Pitts did not understand the transaction and the terms thereof, although Lambert explained it to her. (See Lambert deposition, page 13.) The contract for purchase was not contingent upon the sale of Lambert's motel in Hollywood, Florida. Lambert signed the contract and was presumably aware of its terms. Reinlie did not represent to Mrs. Pitts that the contract for purchase was contingent upon the sale of her son's motel in Hollywood. (See transcript, page 20.) It was Lambert's intent to replace the mortgages on his mother's home with cash he would obtain from the sale of his motel in Hollywood. By substitution of the cash for the mortgages and notes, it was Lambert's understanding that his mother's home would not be "used," i.e., that her home was not in danger of foreclosure. However, Lambert realized that the money would have to be substituted for the mortgages and notes. Lambert felt that he could sell his Hollywood motel prior to the closing date on the Robin Hood Motel. Had Lambert sold his motel in Hollywood prior to said closing, the mortgages and notes on his mother's house would have been cancelled, i.e., "returned" to her. Lambert initially advised Reinlie that his mother owned her home free and clear. At that time, both Lambert and Reinlie were seeking the means for Lambert to come up with the earnest money deposit, which does show a "good faith offer." Reinlie suggested the use of Mrs. Pitts' home to secure the deposit. Lambert discussed this matter with his mother, who agreed and executed the various mortgages and notes. Reinlie did not make the primary approach to Mrs. Pitts, and it was Lambert who primarily explained the transaction to her. Both Lambert and Mrs. Pitts stated that they failed to understand the terms and effect of the mortgages and notes. The addendum to the contract provides that the buyer will provide the seller within five days of the date of the contract a mortgage title binder showing the $5,000 deposit mortgage to be a first mortgage. Their failure to understand the transaction was not due to any misrepresentations or lack of explanation to them by Reinlie. The original closing date was set for late October 1979. When Lambert was unable to sell his Hollywood motel, Reinlie arranged for extensions of the closing date, the first until early December, and the second until January 1980. The considerations for these two extensions were the second and third mortgages and notes. After these were prepared, without signatures, they were delivered to Lambert, who in turn returned each of the executed documents to Reinlie shortly before Reinlie recorded them. Reinlie was not present when said mortgages and notes were executed. Around Thanksgiving 1979, when it became evident that Lambert was having difficulty closing, Reinlie suggested that the contract, which was similar to an option, be sold. Although the contract would have had to be discounted, it would have reduced the potential loss. Reinlie attempted unsuccessfully to do this. Reinlie's suggestion of this course of action did not assure the sale of the contract. (See transcript, page 91.) By late January 1980, when Lambert could not close, Reinlie attempted to obtain an additional extension, which the sellers refused to grant. At that time, the contract for purchase was in default. In the spring of 1980, the sellers made demand upon Reinlie for their deposit money. Reinlie advised both Lambert and Mrs. Pitts of the sellers' demand and sought to obtain mortgage financing for Mrs. Pitts in lieu of initiating a foreclosure action. Mrs. Pitts did not elect to borrow the money. Lambert tendered $5,000 to Reinlie in order to settle the matter, which was rejected by the sellers. The sellers renewed their demand that Reinlie pay them their escrowed deposit. In a meeting with the sellers, Rein lie pointed out that if he foreclosed the mortgages there would be additional delay and legal costs. Because the notes had an interest rate of ten percent and were secured by the mortgages, Reinlie suggested that nothing be done during the life of Mrs. Pitts, but a claim be made against her estate. The sellers determined that this was a better approach than forcing Reinlie to foreclose on the mortgages. Thereafter, all of the parties determined that they desired to settle the matter. Reinlie advised the sellers that he would release the mortgages and notes to Mrs. Pitts if they, in turn, would release him from his obligation to pay them the escrowed money. This was finally done and the matter resolved on that basis.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law that the Respondent, James Reinlie, Jr., did not violate Sections 475.25(1)(b), (d) or (j), Florida Statutes, it is recommended that the charges filed against him in the Administrative Complaint be dismissed. DONE and RECOMMENDED this 25th day of May, 1983, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 25th day of May, 1983. COPIES FURNISHED: John G. DeLancett, Esquire James R. Mitchell, Esquire 801 North Magnolia Avenue, Suite 402 Post Office Box 6171-C Orlando, Florida 32853 Irving Gussow, Esquire Highway 17-92 Post Office Box 965 Fern Park, Florida 32730 Frederick Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Harold Huff, Executive Director Florida Real Estate Commission 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 William M. Furlow, Esquire Florida Real Estate Commission 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 =================================================================
Findings Of Fact Respondent is an applicant to register as a securities salesman with Realty Income Securities, Inc., said application having been submitted to the Division of Securities on February 2, 1975 and is currently pending (Testimony of Dove). During the period of approximately February through - September, 1973, Respondent, a registered mortgage broker, was employed by Financial Resources Corporation of Fort Lauderdale, Florida, in the sale of promissory notes secured ostensibly by first mortgages upon land located in Highlands County, Florida. These notes and security documents were issued by Equitable Development Corporation of Miami Beach, Florida. The notes were payable to "investors" at 14 percent interest per year, payable monthly for several years at which time the full principal balance would become due. The mortgage deeds recited that Equitable Development Corporation held the land which secured the notes in fee simple, free and clear of all encumbrances except real estate taxes. The mortgage deeds further recited that Equitable reserved the right to convey the land to a purchaser under an installment land contract subject to the lien of the mortgage and would deliver to the National Industrial Bank of Miami, an escrow agent, a copy of any such agreement for deed and a quit-claim deed which would be held in escrow. They also provided a procedure by which under any default of Equitable, the escrow agent would deliver the escrow documents to the investor (Testimony of Dove, Petitioner's Composite Exhibit 1). Respondent's association with Financial Resources Corporation came about as a result of a visit by Mr. Robert Rinehart, President of the firm, who explained the mortgage sales program to him and stated that the security instruments were indeed first mortgages. Additionally, Rinehart supplied Respondent with brochures, letters, and documents containing questions and answers concerning the program and the protection afforded thereby to investors. Respondent personally viewed the property in question at Highland Park Estates and observed that over a hundred homes had been constructed which were of a value from $14,000 to $40,000. He also observed that docks had been built on the lake in the project area and that almost all of the roads had been paved. He was shown the MIA appraisal on the property which stated that Rinehart's representations as to property values were accurate. Equitable further represented to him that the notes in question were exempt securities in that they came within the provisions of Section 517.06(7), F.S., concerning the issuance or sale of notes secured by a specific lien upon real property created by mortgage or security agreement. In fact, Respondent became so convinced of the merits of these transactions that he had his mother invest twenty thousand dollars in the program (Testimony of Respondent, Watts; Respondent's Exhibits 1,2). In September 1973, Respondent formed Florida Income Resources Corporation, a mortgage brokerage firm. He did not sell any of the Equitable notes for a period of some months and, prior to commencing sale of them through his firm in the Spring of 1974, his attorney looked over the various aspects of the Equitable program and advised him that everything seemed "open and above board." Respondent thereafter on April 9 and August 1, 1974 sold to William H. Mott secured promissory notes of Equitable Development Corporation in the amounts of $2,000 and $2,250 respectively (Testimony of Respondent, Zawadsky; Petitioner's Composite Exhibit 1). During the period of these sales, letters of Albert George Segal, attorney, were being sent to investors advising them that he had examined the title to the real property purchased and that it was free and clear of encumbrances and constituted valid first mortgages (Respondent's Exhibit 3, Stipulation). Administrative proceedings were brought against Respondent by the Division of Finance involving sales of the notes in question resulting in a settlement by stipulation whereby Respondent did not acknowledge any wrongdoing, but agreed to a suspension of his mortgage broker's registration for two years. Respondent's firm secured no appraisals or title searches on the property involved in the sales to Mott (Testimony of Respondent).
Recommendation That the allegations be dismissed and that Respondent Edgar A Dove be registered as a securities salesman if he otherwise meets the qualifications set forth in Section 517.12, Florida Statutes and Chapter 3E-30, Florida Administrative Code. DONE and ENTERED this 15th day of March, 1976, in Tallahassee, Florida. THOMAS C. OLDHAM Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Fred O. Drake, III Assistant General Counsel Office of the Comptroller The Capitol Tallahassee, Florida 32304 H. Gordon Brown, P.A. 301 W. Camino Gardens Boulevard Suite B P.O. Box 1079 Boca Raton, Florida 33432
Findings Of Fact At all times relevant hereto Frank LaRocca, Respondent, was the holder of Real Estate Broker License Nos. 0050488, 0236407 and 0170796 issued by the Florida Real Estate Commission. On or about July 12, 1989, the Respondent, in the United States District Court, Middle District of Florida, upon a verdict of guilty rendered by a jury, was found guilty of five counts of conspiracy to commit bank fraud, a felony. On or about July 12, 1989, Respondent was sentenced to imprisonment for four years. On or about August 1, 1989, the United States District Court Judge ordered a stay of the judgment against Respondent pending completion of Respondent's appeal. Frank LaRocca was a vice-president of the Central Bank in Tampa, Florida, when he retired in May 1984 after working at this bank for 31 years. During this period, he enjoyed a good reputation in the community. Upon his retirement from the bank, he became an active real estate broker principally investing in real estate. The transactions which formed the bases for his conviction in federal court involved bank loans on condominiums he and three other partners purchased. These bank loans had all been repaid at the time of Respondent's trial but one, which had been refinanced by the bank.
Recommendation Taking all these factors into consideration, it is recommended that the licenses of Frank LaRocca as a real estate broker be revoked, but the revocation be stayed pending completion of his appeal to the court of appeals or two years whichever first occurs. At that time, depending upon the action of the court of appeals, his license be revoked or these proceedings dismissed. ENTERED this 7th day of February, 1990, in Tallahassee, Florida. K. N. AYERS 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 7th day of February, 1990. COPIES FURNISHED: Steven W. Johnson, Esquire Kenneth E. Easley Division of Real Estate General Counsel 400 W. Robinson Street Department of Professional Orlando, FL 32801-1772 Regulation 1940 N. Monroe Street Frank LaRocca Suite 60 Tallahassee, Florida 32399-0792 4814 River Boulevard Tampa, FL 33603 Darlene F. Keller Division Director Division of Real Estate 400 W. Robinson Street Post Office Box 1900 Orlando, FL 32801
The Issue The issues in this case are whether Respondent violated Sections 494.0043(1)(b), 494.0038(1)(a) and (b)1, and 494.0038(2)(a), Florida Statutes (1997), by failing to provide a mortgagee's title insurance policy; by obtaining a mortgage broker fee without a written agreement; and by failing to disclose the receipt of rates, points, or fees on behalf of a lender; and, if so, what, if any, penalty should be imposed. (All chapter and section references are to Florida Statutes (1997) unless otherwise stated.)
Findings Of Fact Petitioner is the state agency responsible for regulating mortgage brokers in Florida. Until September 1999, Respondent was licensed in the state as a mortgage broker pursuant to license number MB9804519. Respondent's license became inactive when Respondent did not renew her license. At all times material to this proceeding, Respondent was the sole owner and operator of Blackstone. Blackstone is licensed in the state as mortgage brokerage business pursuant to license number MBB9901308. On January 8, 1996, Mr. Brian S. Carter and Ms. Lisa G. Carter closed on the purchase of real property located at 1503 Mobile Avenue, Holly Hill, Florida 32117. A non-institutional lender provided a purchase money second mortgage of $19,100 through Karlis and Uldis Sprogis, as co-trustees of the K. E. Sprogis Trust. Respondent was the mortgage broker responsible for the loan in the Carter transaction (the "Carter loan"). On November 12, 1995, Respondent entered into a mortgage brokerage contract with the Carters on behalf of Blackstone. Respondent failed to obtain, or retain in the Carter loan file, a written receipt from the non-institutional lender for the title policy, an opinion of title by an attorney licensed to practice law in Florida, a binder of the title insurance or a conditional opinion of title, or a waiver thereof by the non- institutional lender. In her Petition for Hearing, Respondent admits the foregoing findings pertaining to the Carter loan. On July 11, 1996, Ms. Kay George closed on the purchase of real property located at 2753 Foxdale Drive, Deltona, Florida 32738. Ms. George obtained a purchase money first mortgage in the amount of $56,000 from an institutional lender. Respondent was the mortgage broker responsible for the loan in the George transaction (the "George loan"). On June 15, 1996, Respondent entered into a mortgage brokerage contract with Ms. George on behalf of Blackstone. The mortgage broker contract stated that the mortgage brokerage fee to be paid by Ms. George would not exceed $400. However, the contract disclosed that Respondent would receive between $500 and $2,000 in additional compensation from the lender. The loan-closing documents in the George loan disclose that Respondent received additional compensation of $1,140 comprised of $840 in loan origination fees and $300 in processing fees. The mortgage broker contract failed to disclose the loan origination and processing fees paid by the lender to Respondent. On December 29, 1997, Mr. Roy J. Piper and Ms. Laura A. Piper closed on the purchase of real property located at 30 Arrowhead Circle, Ormond Beach, Florida 32174. EMB Corporation ("EMB") provided a purchase money first mortgage of $68,400. Respondent was the mortgage broker responsible for the loan in the Piper transaction (the "Piper loan"). On December 1, 1997, Respondent entered into a mortgage brokerage contract with the Pipers on behalf of Blackstone. The mortgage broker contract failed to state the amount of the mortgage brokerage fee to be paid by the Pipers. The contract also failed to disclose any additional compensation Respondent was to receive from EMB. The closing documents show that EMB paid Respondent $1,926.25 in additional compensation as a "broker service release premium." On April 9, 1998, Ms. Sunday S. Reiland closed on the purchase of real property located at 300 Chipeway Avenue, Daytona Beach, Florida 32118. Ms. Reiland obtained a first mortgage in the amount of $96,000 from an institutional lender. Respondent was the mortgage broker responsible for the loan in the Reiland transaction (the "Reiland loan"). On March 9, 1998, Respondent entered into a mortgage brokerage contract with Ms. Reiland on behalf of Blackstone. The mortgage broker contract stated that the mortgage brokerage fee to be paid by Ms. Reiland would not exceed $250. However, the contract disclosed that Respondent would receive between $960 and $3,000 in additional compensation from the lender. The loan closing documents in the Reiland loan disclose that Respondent received additional compensation of $730 comprised of a $480 "cash out fee" and a $250 processing fee. The mortgage broker contract failed to disclose the "cash out fee" and processing fee the lender paid to Respondent. On April 23, 1998, Mr. Brian M. Reigel closed on the purchase of real property located at 931 Aspen Drive, South Daytona, Florida 32119. Mr. Reigel obtained a first mortgage in the amount of $39,425 from an institutional lender. Respondent was the mortgage broker responsible for the loan in the Reigel transaction (the "Reigel loan"). On April 8, 1998, Respondent entered into a mortgage brokerage contract with Mr. Reigel on behalf of Blackstone. The mortgage broker contract stated that the mortgage brokerage fee for the Reigel loan would not exceed $550. However, the contract also stated that Respondent would receive additional compensation from the lender ranging between $0 and $3,000. The loan closing documents in the Reigel loan disclose that Respondent received additional compensation of $1,038 from the borrower's funds for a loan discount fee and a processing fee. On October 16, 1998, Mr. William M. Netterville, III, closed on the purchase of real property located at 808 South Grandview Avenue, Daytona Beach, Florida 32118. Mr. Netterville obtained a first mortgage in the amount of $66,000 from an institutional lender. Respondent was the mortgage broker responsible for the loan in the Netterville transaction (the "Netterville loan"). On September 10, 1998, Respondent entered into a mortgage brokerage contract with Mr. Netterville on behalf of Blackstone. The mortgage broker contract stated that the mortgage brokerage fee to be paid by the Mr. Netterville would not exceed $1,000. The loan-closing documents in the Netterville loan disclose that an additional mortgage broker fee of $500 was paid from the borrower's funds to Grandview Financial. The mortgage broker contract failed to disclose the fee paid to Grandview. The mortgage broker contract in the Carter loan stated that the mortgage broker "can make loan commitments." However, Respondent could not make loan commitments. Only the lender could make loan commitments pursuant to a written commitment or "lock-in" for the loan. There is no evidence that the Carters ever obtained the necessary loan commitment from the lender. Respondent represented that the mortgage broker was able to provide loan commitments without disclosing the necessity for a written commitment from the lender.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a Final Order finding Respondent not guilty of violating Section 494.038(1) in the George, Reiland, and Reigel transactions; guilty of violating Sections 494.043(1)(b) and 494.038(2) in the Carter transaction; guilty of violating Section 494.038(1) in the Piper and Netterville transactions; and issuing a written reprimand for Respondent's violations in the Carter transaction; and imposing fines totaling $2,426.25 for Respondent's violations in the Piper and Netterville transactions. DONE AND ENTERED this 27th day of January, 2000, in Tallahassee, Leon County, Florida. DANIEL MANRY 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 27th day of January, 2000. COPIES FURNISHED: Honorable Robert F. Milligan Comptroller State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350 Harry Hooper, General Counsel Fletcher Building, Suite 526 101 East Gaines Street Tallahassee, Florida 32399-0350 Chris Lindamood, Esquire Department of Banking and Finance Hurston Tower South, Suite S-225 400 West Robinson Street Orlando, Florida 32801 Teresa M. Steininger 8907 Roberts Drive Dunwoody, Georgia 30350
Findings Of Fact In his application for registration as a mortgage broker (Exhibit 2), David Stain, Petitioner, in response to question 7 "Have you any judgments against you?" answered "No". By letter dated May 12, 1980 (Exhibit 1), Respondent advised Stein that background investigation revealed numerous judgments against him and stated it would he necessary for Stein to advise why he chose to answer question 7 in the negative. After receiving no response from Stein, Respondent, on 2 July 1980, entered a Final Order denying Stein's application for registration as a mortgage broker. Grounds given in this Order were based upon numerous unsatisfied judgments entered against Stein in Pennsylvania. Exhibit 3, a composite exhibit of court records from Allegheny County, Pennsylvania, shows judgements entered against David Stein and in favor of: Pennsylvania Department of Revenue (2), Diner's Club, Ford Motor Credit Company, Charles Arnold, Alan Shaffer, Carl Kronander, and CNA Financial Corporation.
