The Issue The issue in these cases is whether a land development regulation adopted as City of Key West Ordinance 98-31, and approved by a Final Order of the Department of Community Affairs, DCA Docket No. DCA98-OR-237, is consistent with the Principles for Guiding Development for the City of Key West Area of Critical State Concern set forth in Rule 28-36.003(1), Florida Administrative Code.
Findings Of Fact The Parties. All of the Petitioners in Case No. 99-0666GM, except Neal Hirsh and Property Management of Key West, Inc. (hereinafter referred to as the "Abbe Petitioners"), are all involved in the rental of real property in Key West, Monroe County, Florida. No evidence was presented concerning the identity of Mr. Hirsh or Property Management of Key West, Inc. The Abbe Petitioners are involved in the rental of Key West real property as owners or as rental managers of residential properties which are rented to tourists for periods of less than 30 days or one calendar month (hereinafter referred to as "Transient Rentals). None of the properties used as Transient Rentals by the Abbe Petitioners constitute the Abbe Petitioners' primary residences. Petitioner in Case No. 99-0667GM, Jerry Coleman, owns residential property located in Key West. Mr. Coleman rents the residential property owned by him to tourists for periods of less than 30 days or one calendar month. Mr. Coleman also resides in Key West. Petitioner in Case No. 99-1081DRI, John F. Rooney, failed to present any evidence in support of his case or his standing. Respondent, the Department of Community Affairs (hereinafter referred to as the "Department"), is an agency of the State of Florida. The Department is charged with responsibility for, among other things, the approval or rejection of the comprehensive growth management plan, plan amendments, and land development regulations adopted by the City of Key West. Intervenor, the City of Key West (hereinafter referred to as the "City"), is a political subdivision of the State of Florida. Consistent with the requirements of Part II, Chapter 163, Florida Statutes, the City has adopted a comprehensive growth management plan, the City of Key West Comprehensive Plan (hereinafter referred to as the "City's Plan"). The City's Plan became effective in 1993. The City's Plan consists of twelve elements: (a) Land Use; (b) Historic Preservation; (c) Traffic Circulation; (d) Housing; (e) Public Facilities; (f) Coastal Management; (g) Port Facilities; (h) Conservation; (i) Open Space and Recreation; (j) Intergovernmental Coordination; (k) Capital Improvements; and (l) General Monitoring and Review. Data Inventory and Analysis in support of the City's Plan was compiled by the City. The City has been designated as an area of critical state concern (hereinafter referred to as the "City ACSC"), pursuant to Sections 380.05 and 380.0552, Florida Statutes, since 1974. Rule 28-36.001, et seq., Florida Administrative Code. As an area of critical state concern, all comprehensive plan amendments and land development regulations adopted by the City must be reviewed by the Department for consistency with the Principles for Guiding Development (hereinafter referred to as the "Principles"), set out in Rule 28-36.003(1), Florida Administrative Code. The Principles were adopted by the Governor and Cabinet, sitting as the Administration Commission, in February 1984. Intervenors, Henry and Martha duPont, reside at 326 Whitehead Street, Key West, Florida. The duPonts reside in an area known as the "Truman Annex." The properties on both sides of the duPonts' residence are used as Transient Rentals. Key West History and Tourism. The City is located primarily on the southern-most bridged island of the Florida Keys, a chain of islands, or keys, which run in a generally southwesterly direction from the southeastern tip of the Florida peninsula. The City, like the Florida Keys, is bounded on the west by the Gulf of Mexico and on the east by the Atlantic Ocean. The City is connected to the Florida peninsula by a series of bridges which connect the keys. The road which runs the length of the Florida Keys is designated U. S. Highway 1. It is approximately 112 miles from the Florida mainland to the City. Prior to the early 1970s, the two most significant components of the City's economy were commercial fishing and the military. Tourism also played a role, but not to the extent that it does today. Toward the middle and end of the 1970s the military presence in the City was significantly reduced and the fishing industry was on the decline. To replace the fading fishing and the lost military components of the City's economy, the City turned to tourism. The City's efforts began in earnest during the 1980s and have continued through the present. The City is now a major tourist destination. The City's most attractive features include its historic character, especially the area of the City designated as "Old Town," its warm climate, its extensive shoreline, and its water resources, including coral reef systems. Approximately two-thirds of the City's economic base is now associated with tourism. While the City shares many of the characteristics of most tourist-resort destinations, it also features certain unique characteristics not found in other destinations. Those features include its geographic remoteness and its limited size. The island where the City is principally located is only approximately eight square miles. Currently, approximately 6.82 million tourists visit the City annually. Approximately 62 percent, or 4.25 million visitors, stay overnight in the City. Approximately 480,000 tourists, or about 11 percent of the overnight guests, stay in Transient Rentals. Tourism in the City represents, directly and indirectly, approximately 66 percent of the economic base of the City. The City's economy in turn represents approximately half of the economy of Monroe County. Approximately 15,000 of the 23,000 jobs in Monroe County and Key West are associated with the tourist industry. Of those jobs, 54 percent of all retail sales jobs are involved in the tourist industry. Approximately 50 percent of the estimated $187 million of Monroe County-wide personal income comes from the tourist industry. The tourist industry should continue to prosper in the City as long as the natural environmental characteristics of the City (the climate, surrounding waters, and tropical features of the Keys) and the unique historical and "community" character of the City remain vibrant. It is the natural environment, the climate, and local community character in combination with the historical and cultural attractions of the City that create a diverse mix of attractions which make the City a unique vacation destination. The City's mixture of attractions must be served by a mixture of tourist accommodation services, including hotels, motels, guest houses, and Transient Rentals. Those accommodations are currently available. There are approximately 3,768 hotel/motel rooms available in the City. There are also approximately 507 residential properties with 906 units which are licensed as Transient Rentals in the City and approximately 647 unlicensed residential properties used for Transient Rentals. The loss of the availability of unlicensed Transient Rentals will not have a lasting adverse impact on tourism in the City. The City's Plan recognizes the importance of tourism. Objective 1-1.3, "Planning for Industrial Development and Economic Base," of the land use element of the City's Plan provides, in pertinent part, the following: . . . . Tourism is the most significant component of the City of Key West economic base. The City of Key West is a major tourist destination. It's principal attributes are its historic character, warm climate, extensive shoreline, water resources, the coral reef system, abundant water related and water-dependent activities, and the ambiance of Old Town. The historic district contains many old structures which do not comply with the City's size and dimension regulations since many structures pre-date these local regulations. Realizing the significant contribution of Old Town, especially the unique character of its structures and their historic and architectural significance, and realizing the substantial impact of tourism to the economic base, the City shall direct considerable attention to its growth management decisions to maintaining the historic character of Old Town and preserving tourism as a major contributor to the City's economic base. Similarly, the City shall carefully consider supply and demand factors impacting tourism and the local economy to ensure the long term economic stability. The two policies adopted to implement Objective 1-1.3, Policies 1-1.3.1, "Mandatory Planning and Management Framework for Industrial Development," and Policy 1- 1.3.2, "Pursue Nuisance Abatement Standards and Criteria," provide for measures to deal with industrial development and not tourism. Reliance upon Objective 1-1.3 of the City's Plan by Petitioners' witnesses is misplaced. While the Objective does reflect the importance of tourism in the City, it does not provide any guidance concerning appropriate land uses which may be allowed throughout the City. There is no direction in the Objective concerning land uses which the City must maintain. Land uses are considered and dealt with in other provisions of the City's land use element. Additionally, the reliance upon Objective 1-1.3 of the City's Plan fails to give adequate weight to other provisions of the Plan. The Historic Significance of the City and "Old Town." The importance of the City's history is recognized throughout the Plan. Objective 1-1.3 of the City's Plan quoted, supra, points to the City's history and the role it plays in tourism. An area of the City has been designated as the Key West Historic District. The area is described in the Data Inventory and Analysis as the "physical manifestation of the 170 year existence of [the City]." Page 1A-11 of the Data Inventory and Analysis. Objective 1-2.3 of the Future Land Use Map Goal of the City's Plan deals with the importance of the Key West Historic District and an area which is largely located within the historic district known as "Old Town": OBJECTIVE 1-2.3: MANAGING OLD TOWN REDEVELOPMENT AND PRESERVATION OF HISTORIC RESOURCES. Areas delineated on the Future Land Use Map for historic preservation shall be planned and managed using a regulatory framework designed to preserve the form, function, image, and ambiance of the historic Old Town. The City's Historic Architectural Review Commission (HARC), in addition to the Planning Board, shall review all development proposals within the historic area designated by the National Register of Historic Places. The land development regulations shall be amended upon plan adoption to incorporate design guideline standards recently adopted by HARC. Development in any area of Old Town within and outside the HARC review area may impact the historic significance of Old Town. Any development plans for these areas shall be subjected to site plan review and shall be designed in a manner compatible with historic structures within the vicinity. While Objective 1-2.3 makes reference to the preservation of the "function" of Old Town, the Objective does not require that any particular "land use" which may exist in Old Town be preserved in perpetuity. The Objective and other provisions of the City's Plan addressing the historic significance of the City evidence a concern for the overall character of the area, not particular land uses. That character is described in, and adopted as part of, the Future Land Use Map of the City's Plan. See Policy 1-3.4.1 and Objective 1-3.4 of the City's Plan. Objective 1-1.5 of the Land Use element emphasizes the importance of maintaining and enhancing the appearance of gateway corridors into the City and the "major activiy centers such as Old Town." The Historic Preservation Element of the City's Plan, Chapter 1A, deals with historic resources, structures, and sites. No particular land use of these resources, structures, and sites, other than "housing," is mentioned. Throughout the history of the City, residents have to varying degrees rented their residences or parts of their residences on a short-term basis to tourists and other guests to the City. Most of the rentals involved the rental of portions of a residence while the owner of the property continued to reside in the rest of the property. Monroe County Commissioner Wilhelmina Harvey, Joe Crusoe, Robert Lastres, Vincent Catala, and Olivia Rowe, all long-term residents of the City, all testified about such rentals. The evidence failed to prove, however, that the types of rentals historically undertaken in the City constitute a part of the significant "history" of the City, at least not in the context of the historical significance of the City addressed in the City's Plan. Nor were the historical rentals testified to during hearing of the scale and scope of the rentals that now exist in the City. Additionally, to the extent that Transient Rentals are considered to be part of the significant "history" of the City, nothing in the land development regulation which is the subject of this proceeding absolutely prohibits such rentals. In fact, Transient Rentals of property for which a transient rental license has been obtained are not impacted by the land development regulation. Transient Rentals will, therefore, continue in the City. Nothing in the City's Plan dealing with the historical significance of the City requires that the City allow Transient Rentals of residential property to continue unregulated in the City. Regulation of the extent and location of Transient Rentals in the City does nothing to harm the historical significance of the City. In suggesting that Transient Rentals constitute part of the "history" of the City, and in particular, a part of the history of Old Town, the Abbe Petitioners have relied upon Policy 1-2.3.9, which provides, in part, the following: Policy 1-2.3.9: Retention of Historic Character and All Permanent Single Family Housing Units. The City desires to retain in perpetuity the existing character, density, and intensity of all historic sites and contributing sites within the historic district; and shall protect all the City's permanent single family housing stock citywide which was legally established prior to the adoption of the plan or a legal single family lot of record. Therefore, the City shall protect and preserve these resources against natural disaster, including fire, hurricane, or other natural or man-made disaster, by allowing any permanent single family units within the City, or other structures located on historic sites or contributing sites, which are so damaged to be rebuilt as they previously existed. . . . The reliance upon Policy 1-2.3.9 is misplaced. First, this Policy deals with all permanent single-family housing stock of the City and not just housing used for Transient Rentals. Secondly, the Policy does not provide for the protection of any particular use of single-family housing stock; it provides for the protection of the structures used as single-family housing. It recognizes the unique, historical construction of homes in the City and provides for their continued protection. The Impact of the City's Limited Land Mass and the City's Effort to Control Transient Rentals. As a relatively small island, the City has a limited land area and little opportunity for expansion without significantly altering the traditional character of the City. Because of the limited land area, maintaining adequate housing, including affordable housing, is a significant concern in the City. Residential property in the City has been used by tourists for accommodations for many years, long before the tourist boom now being experienced in the City. Transient uses of residential property were less organized and were less available than they are today, however. Often times, transient uses of residential property consisted of people renting out rooms in their residences to tourists. While the extent to which residential property has been used historically for tourist accommodations was not accurately quantified by the evidence, the evidence did establish that the use of residential property for Transient Rentals has significantly increased since the 1980s. As tourism has increased since the 1980s, there has been an increasing demand for tourist accommodations of all types. This demand for tourist accommodations, especially the demand for Transient Rentals, has adversely impacted the need and demand for residential housing in the City. In an effort to address the problem the Key West City Commission (hereinafter referred to as the "City Commission"), adopted a Growth Management Ordinance in 1985 mandating a ratio of Transient Rentals to residential units for the City. The intent of the 1985 Growth Management Ordinance was to maintain a suitable balance between tourist accommodations and housing for permanent residents of the City. In 1993 the City Commission adopted a dwelling unit allocation ordinance, or the "rate of growth ordinance," which was designed, at least in part, to achieve a balance between the demand for tourist accommodations and the need for permanent housing, including affordable housing. The 1993 rate of growth ordinance was subsequently incorporated into the City's Plan as Objective 1-3.12. Pursuant to the City's Plan, Transient Rentals are not to exceed 25 percent of single family units permitted annually. Note 2 to Policy 1-3.12.3 of the Plan provides that "[t]he number of transient units reflect a preference for preserving housing opportunities for permanent residents as opposed to transient residents since historical trends indicate an erosion of the permanent housing stock which is largely attributed to conversion of permanent housing units to transient housing." The City's Failure to Control Transient Rentals; The "50% Rule." In 1989, the City required that an occupational license be obtained by property owners using their property for both long-term rentals and Transient Rentals. These occupational licenses were not subject to review by the Department for consistency with the City's Plan and land development regulations. Occupational licenses are essentially a revenue raising requirement. The issuance of an occupational license does not constitute a zoning decision or otherwise constitute the approval of a land use. By the time the City adopted the 1993 rate of growth ordinance and the City's Plan, the number of occupational licenses issued for Transient Rentals had already exceeded the allocation of Transient Rentals which are allowable in the City. As a consequence, owners of residential property who desired to use their property for Transient Rental purposes have been unable to obtain an occupational license for such use. The lack of allowable Transient Rentals under the City's Plan did not, however, actually stop individuals from using their property for Transient Rentals. In addition to licensed Transient Rentals, there are approximately 647 unlicensed Transient Rental properties in the City. Properties owned by the Abbe Petitioners and Mr. Coleman are among these unlicensed Transient Rentals. The Abbe Petitioners who own Transient Rentals rather than manage them have occupational licenses issued by the State of Florida and Monroe County, but not a Transient Rental occupational license issued by the City. Mr. Coleman has a "nontransient" license issued by the City and occupational licenses issued by the State and Monroe County, but not a Transient Rental occupational license from the City. The number of unlicensed Transient Rental properties in the City has been contributed to, in part, by an interpretation of a former definition of "tourist and transient living accommodations" found in the City's land development regulations. The definition was adopted in 1986. Accommodations meeting this definition were prohibited in a number of zoning districts in the City. Accommodations which did not come within the definition were not prohibited in those districts. The 1986 definition of "tourist and transient living accommodations" (hereinafter referred to as the "Former Transient Definition"), was as follows: Tourist and transient living accommodations. Commercially operated housing principally available to short-term visitors for less than twenty-eight (28) days. Pursuant to this definition, any property used "principally" for visitors for less than 28 days constituted a tourist or transient living accommodation. There were some who advocated that the term "principally" meant that a residence had to be used as a 28-day short-term visitor accommodation for at least 50 percent of the year. Pursuant to this definition, any residence used at least 50 percent of the year for 28-day or less rentals is considered to constitute a "tourist and transient living accommodation." Conversely, if a residence was used less than 50 percent of the year for 28-day or less rental the property is not considered to constitute a tourist or transient living accommodation. This interpretation of the Former Transient Definition has been referred to as the "50% Rule." Pursuant to the 50% Rule, the owner of residential property in the City could rent the property for periods of less than 28 days without obtaining an occupational license for the property as long as the property was not rented more than half of the year. This rationale was assumed to apply regardless of where the property was located; even in land use districts where Transient Rentals were prohibited. The developer of Truman Annex, an area formerly owned by the Navy located to the immediate south of Old Town, advocated the 50% Rule in his dealings with the City in the early 1990s. The City's licensing department also issued "non- transient" licenses for residences which met the 50% Rule. Code enforcement citations against owners of residences used as Transient Rentals for less than 50 percent of the year without an occupational license were withdrawn. Despite the foregoing, the evidence at hearing in these cases failed to prove that the 50% Rule became an official "policy" of the City Commission. What the evidence proved was that the City took no action to adopt or reject the 50% Rule as an official position. The City simply failed to take any action to reject the 50% Rule and interpret the definition of tourist and transient living accommodations in a more reasonable manner. Given the City's efforts to limit Transient Rentals through the adoption of the 1985 Growth Management Ordinance, the 1993 rate of growth ordinance, and the City's Plan, it is clear, however, that reliance upon the 50% Rule is not reasonable. See findings of fact 39 through 45 of the Department of Community Affairs and City of Key West's Joint Proposed Recommended Order, which are hereby incorporated herein by reference. Finally, even if the 50% Rule did constitute the legislative intent of the City Commission in adopting the Former Transient Definition, it was eliminated by the City Commission in 1997 by the adoption of City Ordinance 97-20. City Ordinance 97-20 was adopted September 16, 1997, and was approved by Final Order of the Department dated November 19, 1997. The new definition of transient living accommodations adopted by City Ordinance 97-20, and still in effect today, is as follows: SECTION 5-21.2: DEFINITION OF TERMS TRANSIENT LIVING ACCOMMODATIONS. Any unit, group of units, dwelling, building, or group of buildings within a single complex of buildings, which is 1) rented for periods of less than 30 days or 1 calendar month, whichever is less; or which is 2) advertised or held out to the public as a place regularly rented to transients. (Emphasis added). The current definition of transient living accommodations has eliminated the reference to properties "principally" used as a Transient Rental. The new definition includes any residence rented for any period of time, even once a year, as long as the rental is for a period of less than 30 days or one calendar month, whichever is less. The Former Transient Definition and, consequently, the 50% Rule, was also superceded by the adoption of the City's Plan. The City recognized the foregoing history in the ordinance which is the subject of this proceeding. In rejecting the notion that the City had adopted the 50% Rule as City policy, the City stated the following in the ordinance: . . . . In 1986, the City enacted former zoning code Section 35.24(44) which provided the following definition of a transient living accommodation "Commercially operated housing principally available to short-term visitors for less than twenty-eight (28) days." (This definition shall hereinafter be referred to as the "Former Transient Definition.") Some property owners and developers interpreted the Former Transient Definition to mean that an owner could rent his or her residential dwelling for less than half the year without the dwelling losing its residential status, and therefore without the need for City-issued transient license . . . . This interpretation went unchallenged by the City. . . . . . . . Therefore, the City of Key West intends by these regulations to establish a uniform definition of transient living accommodations, and to halt the use of residences for transient purposes in order to preserve the residential character of neighborhoods. . . . Based upon the foregoing, any reliance by Petitioners in these cases upon the 50% Rule as City policy is rejected. The City's Adoption of Ordinance No. 98-31. During 1997 and 1998 the City conducted workshops and held public meetings to consider and develop an ordinance regulating Transient Rentals. The workshops were conducted by City staff and were attended by representatives of essentially all those interested in the Transient Rental issue. An effort was made to achieve consensus on the issue. During these workshops, the 50% Rule and the history of Transient Rentals in the City were fully considered. In addition to the workshops conducted by the City, the City hired Frank Pallini with PRG, Real Estate Research and Advisory Services, Clearwater, Florida, to conduct an analysis of the economic impact of an ordinance limiting Transient Rentals. The report prepared by Mr. Pallini (hereinafter referred to as the "Pallini Report"), was submitted to the City on August 28, 1998. The Pallini Report and, consequently, the negative economic impact of the ordinance at issue in this proceeding was fully considered by the City when it adopted the ordinance. On June 2, 1998, the City Commission adopted Ordinance 98-16, which amended the definition of "transient living accommodations" in the City's land development regulations. Unlicensed short-term Transient Rentals were expressly prohibited by Ordinance 98-16 with the exception of four specified City land use districts. Those districts, referred to during the hearing as "gated communities," are all single, contiguous zoning district areas of the City with controlled access and which are governed by homeowners' or condominium associations. Truman Annex was one of the four excluded gated communities. Ordinance 98-16 was found by the Department to be inconsistent with the Principles on July 29, 1998, by Final Order DCA98-OR-135. The Department concluded that Ordinance 98- 16 was inconsistent with the Principles because it allowed the use of residential property as Transient Rentals in areas where, according to the Department, such rentals were prohibited under the City's Plan. The City initially challenged the Department's decision, but subsequently withdrew its challenge. The City subsequently repealed Ordinance 98-16. On November 10, 1998, the City adopted Ordinance 98-31 (hereinafter referred to as the "Ordinance"), which is the subject of this proceeding. The Ordinance contains the same provisions, except the exception for gated communities, that had been contained in Ordinance 98-16. The Ordinance is a "land development regulation" as defined in Section 380.031(8), Florida Statutes. It is, therefore, subject to review for consistency with the Principles by the Department. During the process of adopting the Ordinance the City recognized the confusion that the 50% Rule had caused concerning the intent of the City's Plan with regard to Transient Rentals. The City expressly dealt with the 50% Rule and rejected it as policy of the City. In particular, the Ordinance provides that the City's purpose in enacting the Ordinance was to phase out unlicensed transient uses of residential properties in land use zoning districts in which they are not permitted. This goal is accomplished by further modifying the definition of "transient living accommodations" adopted in 1997 in Section 5-21.2 of the City's land development regulations: Sec. 5-21.2 Definition of terms. Transient Living Accommodations. Or Transient Lodging. Any unit, group of units, dwelling, building, or group of buildings within a single complex of buildings, which is 1) rented for a period or periods of less than 30 days or 1 calendar month, whichever is less; or which is 2) advertised or held out to the public as a place rented to regularly regularly rented to transients. , regardless of the occurrence of an actual rental. Such a short-term rental use of or within a single family dwelling, a two family dwelling or a multi-family dwelling (each also known as a "residential dwelling") shall be deemed a transient living accommodation. (Words struckstruck through were eliminated from the definition and underlined words were added). The Ordinance also adds Section 2-7.21 to the City's land development regulations explaining its action in modifying the definition of transient living accommodations and expressly prohibiting unlicensed Transient Rentals of less than 30 days or one calendar month, whichever is less. The Ordinance does not provide for a complete ban on Transient Rentals. On the contrary, Transient Rentals of properties for which transient occupational licenses have been issued by the City are expressly allowed by the Ordinance. The City estimated that 507 residential properties containing a total of 906 transient units hold such licenses. Under the Ordinance, these units may continue to be used as Transient Rentals. The Department's Review of the Ordinance. On November 24, 1998, the City transmitted a copy of the Ordinance to the Department for approval or rejection pursuant to Section 380.05(6), Florida Statutes. The Department conducted its review of the Ordinance following its customary procedures for review of land development regulations that impact an area of critical state concern. The review included a consideration of Chapter 28-36, Florida Administrative Code, including the Principles, the City's Plan, and the legislative intent of Chapter 380, Florida Statutes. The Ordinance was directed to Kenneth Metcalf, the person in the Department responsible for supervision of the City ACSC. Mr. Metcalf reviewed the ordinance and assigned it to the Department's Field Office with directions as to which issues the Field Office should address during its review. Following staff review, an evaluation was prepared addressing the Ordinance's consistency with the Principles. The evaluation was reviewed by Mr. Metcalf. After receipt and review of the evaluation, it was discussed at a meeting of Department staff. As a result of the meeting, it was recommended that the Secretary of the Department find the Ordinance consistent with the Principles. On January 5, 1999, the Department entered a Final Order, DCA98-OR-237, finding that the Ordinance was consistent with the Principles. The Department caused notice of the Final Order to published in the Florida Administrative Weekly. Petitioners' Challenge to the Ordinance. The Abbe Petitioners, Mr. Coleman and over 200 other owners of property in Truman Annex, and Mr. Rooney all timely filed petitions challenging the Department's Final Order pursuant to Sections 120.569 and 120.57, Florida Statutes, to the Department's Final Order approving the Ordinance. The petitions were filed with the Division of Administrative Hearings by the Department. The petitions were designated Case Nos. 99-0666GM, 99-0667GM and 99-1081DRI, respectively. Following dismissal of the petitions in all three cases, amended petitions were filed. Mr. Coleman's amended petition, filed on or about June 14, 1999, named Mr. Coleman as the only Petitioner remaining in that case. Standing. The parties stipulated to certain facts relating to the standing of the Abbe Petitioners and Mr. Coleman. In addition to stipulating to the facts found, supra, concerning the ownership and use of real property by the Abbe Petitioners and Mr. Coleman in the City, it was agreed that the Abbe Petitioners and Mr. Coleman have transient occupational licenses issued by the State of Florida and Monroe County for their City real property. The Abbe Petitioners and Mr. Coleman suggested in their proposed orders that it had been stipulated during the hearing that they have standing to initiate, and participate in, this proceeding. A close reading of the stipulation of the parties, however, fails to support this contention. What the Department, City, and the duPonts stipulated to were certain underlying facts; they did not stipulate to the ultimate finding. The Department, City, and duPonts did not stipulate to whether the Abbe Petitioners and Mr. Coleman will suffer an immediate injury as a result of the Ordinance. The evidence proved that, the Abbe Petitioners and Mr. Coleman do not have the legal right to use their properties as Transient Rentals. Neither a reasonable interpretation of existing land development regulations nor the 50% Rule legalizes such use. As a consequence, the Ordinance cannot have the effect of preventing the Abbe Petitioners and Mr. Coleman from using their properties for Transient Rental purposes because that is not a purpose for which they are legally authorized to use the properties anyway. The evidence also proved, however, that the City has allowed the Abbe Petitioners and Mr. Coleman to continue to use their properties as Transient Rentals, legally or not, and that, without the City's taking some action, the Abbe Petitioners and Mr. Coleman would continue to do so. As a consequence, the Ordinance will have the practical and real effect of preventing the Abbe Petitioners and Mr. Coleman from continuing to use their properties as Transient Rentals, to their economic detriment. The Abbe Petitioners, other than Neal Hirsh and Property Management of Key West, Inc., and Mr. Coleman have proved that they have standing to institute and participate in this proceeding. The duPonts proved that they have standing to participate in this proceeding. The City proved that its substantial interests were determined by the Department's decision in this matter. The City has standing to participate in this proceeding. Mr. Hirsh, Property Management of Key West, Inc., and Mr. Rooney failed to prove that they have standing to institute or participate in this proceeding. The Principles. Rule 28-36.003, Florida Administrative Code, contains the Principles: Strengthen local government capabilities for managing land use and development; Protection of tidal mangroves and associated shoreline and marine resources and wildlife; Minimize the adverse impacts of development of the quality of water in and around the City of Key West and throughout the Florida Keys; Protection of scenic resources of the City of Key West and promotion of the management of unique, tropical vegetation; Protection of the historical heritage of Key West and the Key West Historical Preservation District; Protection of the value, efficiency, cost-effectiveness and amortized life of existing and proposed major public investments, including: The Florida Keys Aqueduct and water supply facilities, Sewage collection and disposal facilities, Solid waste collection and disposal facilities, Key West Naval Air Station, The maintenance and expansion of transportation facilities, and Other utilities, as appropriate; Minimize the adverse impacts of proposed public investments on the natural and environmental resources of the City of Key West; and Protection of the public health, safety, welfare and economy of the City of Key West, and the maintenance of Key West as a unique Florida resource. In determining whether the Ordinance is consistent with the Principles, the Principles should be considered as a whole. No specific provision should be construed or applied in isolation from the other provisions. The Ordinance has little or no impact on those Principles that relate to the natural resources of, and public facilities in, the City. Those Principles include Rule 28- 36.003(1)(b), (c), (d), (f), and (g), Florida Administrative Code. Those Principles are considered neutral in the determination to be made in these cases. The determination of whether the Ordinance is consistent with the Principles is limited to a balancing of the Principles listed in Rule 28-36.003(1)(a), (e), and (h), Florida Administrative Code (hereinafter referred to as "Principles A, E, and H," respectively). Principle A: The Ordinance Strengthens the City's Capabilities for Managing Land Use and Development. In order for the Ordinance to be considered as strengthening the City's capabilities for managing land use and development, the Ordinance must be consistent with the City's Plan. The evidence proved that it is. The City's Plan contains various land use districts, all of which have certain allowable and prohibited uses. The districts established in the City's Plan and the relevant prohibition of transient lodgings are as follows: Coastal Low Density Residential Development district: prohibits "transient lodging and guest homes." Single Family Residential Development district: prohibits "transient accommodations" and "transient rental housing." Medium Density Residential Development district: prohibits "transient lodging and guest homes." Mixed Use Residential/Office: prohibits "transient lodging." Limited Commercial Development: Prohibits "transient residential land use activities." Historic High Density Residential Development and Historic Medium Density Residential Development districts: prohibit "transient residential uses, including guest homes, motels, or hotels." Historic Residential Commercial Core 2: prohibits "transient residential uses." Historic Residential/Office district: prohibits "transient lodging or guest houses" unless previously licensed. Conservation, Military, and Public Services districts: prohibit transient uses. The following districts established by the City Plan allow Transient Rentals: Salt Pond Commercial Tourist: allows "motels, [and] limited scale tourist facilities." General Commercial Development: allows "transient lodging including hotels and motels, timesharing or fractional fee residential complexes, and other transient quarters." Mixed Use Planned Redevelopment and Development districts: uses are determined, not by the City's Plan, but the land development regulations and development approvals for these large scale development districts. Historic Residential Commercial Core 1 and 3 districts: allow "transient residential accommodations" and "tourist accommodations." Historic Neighborhood Commercial: allows "transient rental accommodations" in HNC-1 and HNC-3 districts as long as they do not displace permanent resident housing and "transient accommodations" in HNC-2 districts. Historic Commercial Tourist: allows "hotels, motels, and/or transient lodging facilities." The most reasonable interpretation of the restricted and allowable land uses for the land use districts established under the City's Plan is that references to "transient rental accommodations," "transient residential uses," "transient rental housing," and "transient lodging facilities" are intended to include Transient Rentals. One other district is established by the City's Plan which is relevant to this matter: Historic Planned Redevelopment and Development districts (hereinafter referred to as "HPRD" districts). Land uses allowable in an HPRD district are to be established by land development regulations. The only HPRD district in the City is currently the Truman Annex. Truman Annex was being developed at the time the City's Plan was adopted. While the City's Plan provides that the specific requirements for any HPRD district is to be provided by land development regulations, Policy 1-2.3.4 of the City's Plan does provide, among other things, that the regulations are to "[a]void replacement of permanent housing stock with transient lodging." The Ordinance, and its application to Truman Annex, is consistent with this direction of the City's Plan. Truman Annex was developed as a development of regional impact, or "DRI." As a DRI and HPRD district, land uses in Truman Annex are subject to development agreements between the City and the developer of Truman Annex. Those agreements have been amended 12 times. The Truman Annex development agreements allow the development of "housing units," which included both transient and non-transient uses. "Housing units" were further broken down into the following types: "affordable," "hotel transient housing units," "time share transient housing units," and "other residential housing units." "Affordable" and "other residential housing units" are intended to be "residential" development in the context of the Truman Annex development agreements; "hotel transient housing units" and "time share transient housing units" are intended to be Transient Rentals in the context of the Truman Annex development agreements. Given the distinction between "transient" housing units and other uses in the Truman Annex development agreements, no approval of Transient Rentals of "affordable" or "other residential housing units" was contemplated or allowed by the City. The Truman Annex development agreements and the HPRD district land development regulations do not authorize the use of "affordable" or "other residential housing units" in Truman Annex as Transient Rentals. The Ordinance is, therefore, consistent with the Truman Annex development agreements and the HPRD district land development regulations. The Ordinance, if nothing else, clarifies the state of the law with regard to which Transient Rentals are allowed and which are prohibited in the City. The Ordinance eliminates any lingering confusion caused by the failure of the City to reject the 50% Rule in all circumstances and to properly interpret the Former Transient Definition. The suggestion of the Abbe Petitioners that the 50% Rule was adopted as a part of the City's Plan because it existed when the City's Plan was adopted is not supported by the evidence. Again, the 50% Rule was never adopted as the official policy of the City; it simply went unchallenged by the City. In fact, the 50% Rule was allowed to be advanced by some despite the adoption of the City's Plan and its prohibition against Transient Rentals in the land use districts described, supra. Nor does Objective 1-1.3 of the City's Plan support the Petitioners' position in these cases. That Objective does not require that any particular land use be continued in the City. Nor do those provisions of the City's Plan dealing with the historic significance of the City detract from the conclusion that the Ordinance is consistent with the City's Plan. The provisions dealing with the historic significance of the City are concerned with the significance of structures which have been a part of the history of the City's existence. The City's Plan also evidences a desire to preserve historically significant housing, not any particular use of those structures. Based upon a preponderance of the evidence, the Ordinance is consistent with Principal A. Principle E: Protection of the Historic Heritage of the City and the Key West Historical Preservation District. Principle E requires a consideration of significant events in the history of the City, famous visitors and residences of the City throughout its history, the architectural history of the City, and other aspects of the City's character. This conclusion is supported, in part, by Rule 28-36.003(2)(e), Florida Administrative Code: (e) Historic Resource Protection. A management and enforcement plan and ordinance shall be adopted by the City of Key West providing that designs and uses of development reconstruction within the Key West Historical Preservation District shall be compatible with the existing unique architectural styles and shall protect the historical values of the District. The City of Key shall maintain an architectural review board established pursuant to Section 266.207(2), Florida Statutes. . . . . The evidence in these cases proved that the Ordinance will preserve and ensure the preservation of the City's historical significance. It will do so by limiting the destruction of the character and community of the City, as discussed, infra. Principle E does not support a conclusion, as argued by Petitioners, that Transient Rentals have played such a large part in the history of the City that they should not be regulated in the manner the Ordinance provides for. Petitioners' argument also fails because the Ordinance only regulates Transient Rentals, it does not eliminate historical Transient Rental uses. The City's Plan also fails to support Petitioners' argument. The City's Plan does not address, or require, the continuation of "historical" land uses such as Transient Rentals. Based upon a preponderance of the evidence, it is concluded that the Ordinance is consistent with Principal E. Principle H: Public Health, Safety, and Welfare and the Economy of the City. Principal H requires a consideration of the public health, safety, and welfare, and the economic viability of the City. These factors are inextricably tied to the tourist industry of the City. Without the tourist industry, the City's economy would likely falter to the detriment of the public health, safety, and welfare. A large part of what makes the City attractive, to tourist and residents alike, is the unique community atmosphere and the historical character of the City. The health of the tourist industry in the City is, in part, caused by the City's vibrant and viable communities. An essential characteristic of that vibrancy is the fabric of the people that inhabit the City and the interactions of those inhabitants among themselves and with tourists. As long as tourists continue to enjoy the unique character of the City, they will continue to enjoy their experience and will continue to come back to the City. If that unique character is significantly diminished or lost, so too will be the tourist industry. A number of factors threaten the quality of the tourist experience in the City and, therefore, the continued viability of the tourist industry. Those factors include the shortage of available and affordable housing, a shortage of labor to serve the tourist industry, crowding, and conflicts between tourist and residents of the City. All of these factors are related and must be adequately addressed in order to protect the economic viability of the City. Left unchecked, tourism in the City will likely be seriously impacted. Tourism requires a large labor force to provide the services which tourist expect. The labor force must provide lodging, food, retail sales, amusements, and other services. Indirect services, such as fire protection, police, and others must be provided for also by the labor force. The labor force necessary to serve a tourist industry must be provided with adequate housing. The ability to meet this need must be balanced with the need to provide adequate accommodations to the tourists who visit a destination. The need to balance these competing interests is an even greater challenge in the City because of the existing shortage of available residential property in the City and the lack of viable measures which can be taken to address the shortage. The City's shortage of residential property is caused by the fact that the supply of available land in the City is so restricted it simply cannot meet the demand. The problem caused by the lack of available land is exacerbated by restrictions on development, including those imposed by the rate of growth ordinance and the City's Historic Architectural Review Commission. Actions of the City's Historic Architectural Review Commission cause increases in the cost of redeveloping property and limits the types of redevelopment that may be pursed. Alternatives, like housing the labor force some distance from a tourist destination and providing transportation to bring the labor force into the destination, cannot be utilized in the City to meet the demand for housing for its labor force. The unavailability of adequate land is a problem throughout the length of the Florida Keys. Tourist are now demanding a variety of accommodations. The national trend has seen a increase in the demand for accommodations other than the traditional hotel or motel. Many tourists desire accommodations that include multiple rooms, including kitchen facilities. Transient Rentals have become increasingly available in order to meet part of this demand. Hotels and motels have also begun to offer efficiency- like units. Transient Rentals have also increased because of 1986 changes in federal income tax laws. Those changes have resulted in more owners of vacation housing turning their properties into Transient Rentals in order to offset the cost of the properties. The availability of Transient Rentals has significantly increased in scope and magnitude over what was historically experienced in the City. In addition to the impact on the types of accommodations desired by tourist and the tax benefits of converting property to Transient Rental use, tourism itself has increased dramatically during the past 30 years, further increasing the demand for tourist accommodations. According to a report on housing in the City known as the "Shimberg Report," from 1990 to 1995 the number of housing units decreased from 12,221 to 11,733, a decrease of 488 units. Despite this decrease, the number of households in the City during the same period increased from 10,424 to 11,298, an increase of 874. Economically, a commercial-type use, such as Transient Rentals, will usually be more profitable than a residential use of the same property. The City has experienced this economic impact. As a result of the higher economic value of using a residence as a Transient Rental, tourist use of residential property have in many cases displaced the residential use of property. The demand for Transient Rentals and the need to provide for housing for the labor force necessary to serve the City's tourist industry involve competing and inconsistent goals. In order to meet the need for Transient Rentals in the City, it has been necessary to convert housing formerly used to house the City's residents, including those who make up the labor force. The resulting decrease in residential housing and the increase in Transient Rentals also result in crowding, with members of the labor force in the City being required to share available space with tourists. Crowding results in unacceptable densities of use and increased user conflict. The resulting decrease in residential housing caused by the increase in Transient Rental use in the City has not only resulted in permanent residents leaving the City's communities, but in their departure from the City and the Florida Keys altogether. In addition to the negative impacts on housing, a tourist destination can become so popular that the very quality of the location is negatively impacted or even destroyed. John Pennekamp State Park, located in the northern part of the Florida Keys, has been so successful at attracting visitors that it has been negatively impacted. Although tourism has not reached a point where it is destroying the unique character of the City, the very thing that attracts many visitors to the City, it has the potential of reaching that stage without adequate planning by the City. Shopping by residents in the "downtown" area of the City has already been displaced by shopping areas located away from Old Town. Dr. Virginia Cronk testified during the hearing of these cases concerning what can happen to a community's identity if tourism becomes too dominate. The City is already showing some signs of the negative impact tourism can have on a community. As more stress from overcrowding is placed on the City's communities, the very base of the City's tourist industry is impacted. Not only will the labor force be moved out, the community atmosphere of communities that is so attractive in the City may be diminished or even destroyed. As in many other tourist destinations, the activities of tourists and permanent residents the City are often incompatible. This is especially true in the City because much of what attracts tourists to the City is associated with the City's residential neighborhoods. Part of the tourist destination of the City is its neighborhoods. The type of visitors attracted to the City over the last decade has changed significantly. Many tourists now come to "party" on Duval Street, often late into the night and the early morning hours. The partying often continues back to, and at, the accommodations that the tourists utilize. Many tourists make every effort to maximize their "fun time" by staying up late and playing hard. Because tourists are on vacation, they are not as concerned about when they go to sleep and when they enjoy the City. They are not required to keep any particular schedule, so they are more at liberty to stay up into the early morning hours. Because tourists are only in the City for a short time, they are also less concerned with getting along with their neighbors. They want to have a good time and assume that everyone around them is there for the same reason. Permanent residents of the City are much like permanent residents everywhere. The adults are employed during the day and their children attend school. They go to bed and rise earlier than tourists generally do. Because of the differences in the goals of tourists and permanent residents, inevitable conflicts arise when tourists and residents mix. Unless those conflicts are controlled in the City, permanent residents will be forced out, threatening to end one of the very features that has made the City so attractive to tourists: the unique community atmosphere and historical character of the City. Dr. Cronk explained the different social forces which impact the behavior of tourists and residents. Tourists are simply not subject to the same informal social controls that residents are. As a result, the behavior of tourists often comes into conflict with the behavior normally associated with a true community neighborhood. Because the behavior of tourists is not subject to the same informal social controls as residents, residents must turn increasingly to more formal social controls such as the police and private security forces. These controls often do not work and are more expensive than the informal social controls normally associated with neighborhoods. Witnesses during the hearing of these cases gave examples of clashes between permanent residents and tourists. Those incidents are fully reported in the transcript of the hearing of this matter and are summarized in the proposed orders filed by the Department and City, and the duPonts. The need to resort to more formal social controls, such as the police and private security was also explained by these witnesses. The credible testimony of Ms. Rowe, Margaret Domanski, and Martha duPont accurately describe the types of conflicts the Ordinance is intended to reduce. The impact which the conversion of residential properties to Transient Rentals has on affordable housing in the City is difficult to measure. The Department has suggested that it is significant. Petitioners argue that there is no impact and that, even if there were some impact, affordable housing is not one of the Principles and, therefore, should play no part in the review of the Ordinance. The principles which apply to Monroe County require that Monroe County "make available adequate affordable housing for all sectors of the population of the Florida Keys." Section 380.0552(7)(j), Florida Statutes. This principle is consistent with the legislative intent set out in Section 380.0552(2)(d), Florida Statutes, that a local government provide affordable housing in close proximity to places of employment in the Florida Keys. The Principles applicable to the City ACSC do not contain a principle specifically requiring that affordable housing be maintained. The lack of a specific requirement concerning affordable housing does not, however, support a conclusion that affordable housing should be ignored when applying the Principles to land development regulations adopted by the City. On the contrary, Principle H is broad enough to require a consideration of affordable housing. After all, any consideration of the "public health . . . welfare, and economy" of the City, necessarily must include a consideration of affordable housing. Without adequate housing for all sectors of the City's population, the public health and welfare of the City cannot be maintained. Nor can the economy of the City survive without adequate housing for all segments of the work force. "Affordable housing" does not mean housing for the poor. "Affordable housing" is defined in terms of the percentage of a household's income spent on housing which is considered "affordable" by very-low income, low-income, and moderate-income persons. What is considered affordable is based upon the median household income of a community's very-low income, low-income, and moderate-income population. The approximate median household income of City residents is $49,000.00. In order for the City to be considered to have adequate "affordable housing," persons making between 80 and 120 percent of the median household income, or $39,000 to $59,000, should be able to afford a house. The average value of a single-family house in the City, however, is $300,000, well above the price affordable to persons with a household income of between $39,000 and $59,000. Because of the disparity between the average price of homes and the low median household income of City residents, an enormous burden is placed on residents to fund any type of housing. As much as 30 percent of residents' income must be spent on housing. The number of residents spending at least 30 percent of their income on housing increased significantly between 1990 and 1995. That number is likely to continue to increase. As the cost of residential property increases, the economic burden on residents for housing continues to increase. The cost of residential property is increasing, and will continue to increase, because of the conversion of residential property to Transient Rentals. If the City takes no action with regard to balancing tourist accommodations, particularly Transient Rentals, and housing for its residents, the ability of residents to afford any housing will continue to be negatively impacted. Even though it is doubtful that the Ordinance will increase the ability of residents to actually own their own home, there is no doubt that their ability to afford any housing will continue to be negatively impacted if Transient Rentals continue to displace the use of property for residential purposes. In adopting the Ordinance, the City recognized the negative impact that tourism is having on the City: . . . the transient use of residential dwellings has had deleterious consequences in the residential neighborhoods of Key West; and . . . the increase in the conversion of residential dwellings to transient use is, in part, responsible for the affordable housing shortage in Key West, a shortage confirmed in a study of the City by the Shimberg Center of the University of Florida . . . The finding concerning affordable housing is consistent with the City's Plan. Objective 3-1.1 and Note 2, Policy 1-3.12.3 of the City's Plan. In adopting the Ordinance, the City took a reasonable step to address the problems associated with tourism. The Ordinance, while causing an initial negative impact to the economy, will promote the protection of residential neighborhoods from unnecessary intrusion, promote affordable housing, and ultimately ensure the continued viability of the tourist economy of the City. By limiting the intrusion of Transient Rentals into most residential neighborhoods in the City, the Ordinance will limit the intrusion of negative tourist activities into those neighborhoods. Those negative impacts testified about by Ms. Rowe, Ms. Domanski, and Ms. duPont will be, in most cases, prevented or at least reduced. The reduction of tourist intrusions into neighborhoods will also ensure that the unique community character of the City remains viable. The Ordinance will go a long way in keeping the charm of the City's neighborhoods intact for tourists and residents both. The Ordinance goes a long way in planning for tourism in the City. Reducing economically competitive uses of property in the City, such as the use of property for Transient Rentals, will ensure that the scarce supply of residential property is not further reduced. Stabilizing the supply of residential property, while not eliminating cost increases, will at least eliminate the increase in housing costs associated with the conversion of residential property to Transient Rental use. Eliminating the unlicensed use of Transient Rentals, which the Ordinance will do, will have the effect of actually returning some residential property to the supply of property available to residents. By prohibiting the use of residential properties as Transient Rentals, the total properties in the City available for housing, including for long-term rentals, for permanent residents, will increase. As supply increases, the demand for all housing, including to a very limited extent affordable housing, will be better met. By reducing the drain on residential properties in the City, the strain on the work force necessary to serve the tourist economy of the City will also be reduced. The City recognized and accepted the fact that the Ordinance will have an initial negative impact on the economy of the City. The Pallini Report was commissioned by, and considered by the City Commission. There will be an immediate reduction in revenues from unlicensed Transient Rentals that comply with the Ordinance and the income associated with providing services to those Transient Rentals. Some tourists who would otherwise select the City as their vacation destination will go elsewhere. Unlicensed Transient Rentals (taxed and untaxed), however, make up no more than ten percent of the total accommodations available in the City. It is estimated that the Ordinance will result in a loss in gross sales of $31 million, a loss in personal income of $9 million, and a loss in City revenues annually of $260,000. It is also estimated that there will be a loss of approximately 500 jobs associated with unlicensed Transient Rentals. These estimates are the "worst case" scenario figures. Actual losses will likely be somewhat less. The losses associated with the Ordinance will, however, not be long-term. Gradually, the tourist industry will adjust to the decrease in tourist accommodations and the negative impact on the economy. Some tourists will adjust the time of year they come to the City, resulting in greater tourist business during traditionally slower times. Persons who experience unemployment as a result of the Ordinance will also very likely find other employment relatively quickly because of the tight labor market in the City. The negative economic impacts to the City caused by the Ordinance should not last longer than three to five years. After that time, the economy will adjust. The overall impact of the Ordinance will be to help balance the need to provide tourist accommodations and the need to protect the charm of the City and the ability of the City to provide a work force. Protection of residential neighborhoods in the City comes within the City's responsibility to provide for the public health, safety, and welfare of its citizens, and is a necessary consideration in providing for the economic well- being of the City. Based upon a preponderance of the evidence, the Ordinance is consistent with Principal H. Truman Annex. It has been argued by Mr. Coleman that the application of the Ordinance to the Truman Annex supports a conclusion that the Ordinance is not consistent with the Principles. The evidence failed to support this contention. Truman Annex is located within walking distance of most tourist destinations in the City. The character and atmosphere of Truman Annex makes it an attractive tourist destination in itself. The "Little Whitehouse," a house utilized by President Harry Truman, is located within Truman Annex as is a tourist destination itself. While the Truman Annex is located in an area conducive to use as tourist accommodations, nothing in the City's Plan or land development regulations, the development orders associated with Truman Annex, the historic use of Truman Annex, the public health, safety and welfare, or the continued economic viability of the City depends upon such use. Truman Annex consists of residential housing and tourist accommodations, as well as some commercial facilities. Those activities are, however, largely buffered from each other. Most of the commercial activities are located in the western portion of Truman Annex. The residential housing is located primarily in the eastern portion of Truman Annex. Truman Annex without Transient Rentals constitutes appropriate planning by the developer of Truman Annex and the City. The Ordinance, even when applied to Truman Annex, constitutes an appropriate effort of the City to manage land uses and development. The Ordinance, even when applied to Truman Annex, will protect the historic heritage of Truman Annex and, more importantly, the City. Finally, the evidence proved that the application of the Ordinance to Truman Annex will not adversely impact the public health, safety, welfare, or the long-term economy of the City. Consideration of the Principles as a Whole. The evidence in these cases supports a conclusion that the Ordinance has no or little impact on most of the Principles, except Principles A, E, and H. The evidence proved that the Ordinance is neutral with regard to the other Principles. When Principles A, E, and H are considered individually and together, the evidence proved that the Ordinance is consistent with Principles A, E, and H. The Ordinance constitutes an effort of the City to manage land uses and development in the City, consistent with Principal A. The Ordinance will also help to protect the historic heritage of the City by preserving the character of the City's neighborhoods and, as a result, will preserve the tourist industry, consistent with Principal E. Just as clearly, the Ordinance will enhance the safety, health, and welfare of the residents of the City. Finally, the Ordinance is consistent with Principal H because it will benefit the public health, safety, and welfare of the City by protecting neighborhoods from the intrusion of tourists, reducing the impact of the conversion of residential housing for Transient Rentals, and ensuring the continued character of the City. While there will be an initial negative impact on the economy of the City as a result of the Ordinance, ultimately the Ordinance will have a positive impact on the economy of the City due to the positive impact on the City's tourist industry which will result from the regulation of Transient Rentals. Abbey Petitioners' Rule Challenge, Constitutional Issues, and Other Issues. In the Amended Petition for Administrative Hearing (hereinafter referred to as the "Amended Petition") filed by the Abbe Petitioners, the Abbe Petitioners attempted to challenge pursuant to Section 120.56(4), Florida Statutes, portions of the Final Order of the Department as an unpromulgated rule. The Amended Petition was not, however, filed consistent with the requirements of Section 120.56(4), Florida Statutes. This challenge was required to be filed in a separate petition filed solely with the Division of Administrative Hearings (hereinafter referred to as the "Division") and not through an amendment to a petition originally filed with the Department which was subsequently filed by the Department with the Division with a request that the Division hear the matter. Additionally, even if the issue were properly before the Division, the evidence in this case failed to prove that the statements in the Final Order have any application other than to the Ordinance. Therefore, those statements are not "agency statements of general applicability." The statements are not, therefore, "rules" as defined in Section 120.52(15), Florida Statutes. The Abbe Petitioners also raised issues in the Amended Petition other than the consistency of the Ordinance with the Principles. Other than the question of the consistency of the Ordinance with the Principles, the evidence failed to support the Abbe Petitioners' argument that the issues raised in the Amended Petition are relevant to this matter.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Community Affairs enter a final order approving City of Key West Ordinance 98-31 as consistent with the Principles for Guiding Development of Rule 28-36.003(1), Florida Administrative Code. DONE AND ENTERED this 31st day of August, 2000, in Tallahassee, Leon County, Florida. LARRY J. SARTIN 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 31st day of August, 2000. COPIES FURNISHED: Jeffrey M. Bell, Esquire Ritter, Chusid, Bivona & Cohen, LLP 7000 West Palmetto Park Road, Suite 400 Boca Raton, Florida 33433 Jerry Coleman, Esquire Post Office Box 1393 Key West, Florida 33041 John F. Rooney 208-10 Southard Street Key West, Florida 33040 Andrew S. Grayson, Esquire Assistant General Counsel Department of Community Affairs 2555 Shumard Oak Boulevard Tallahassee, Florida 32399-2100 Robert Tischenkel, City Attorney City of Key West Post Office Box 1409 Key West, Florida 33041 David J. Audlin, Jr., Esquire Eaton Street Professional Center 524 Eaton Street, Suite 110 Key West, Florida 33040 Lee R. Rohe, Esquire Post Office Box 500252 Marathon, Florida 33050 Barbara Leighty, Clerk Growth Management and Strategic Planning The Capitol, Suite 2105 Tallahassee, Florida 32399 Carol A. Licko, General Counsel Office of the Governor The Capitol, Suite 209 Tallahassee, Florida 32399-0001 Steven M. Seibert, Secretary Department of Community Affairs 2555 Shumard Oak Boulevard, Suite 100 Tallahassee, Florida 32399-2100 Cari L. Roth, General Counsel Department of Community Affairs 2555 Shumard Oak Boulevard, Suite 325 Tallahassee, Florida 32399-2100
The Issue Whether Respondent real estate broker is guilty of a discriminatory housing practice against Petitioners related to the sale and marketing of their home.
Findings Of Fact Petitioner homeowners allege that Respondent real estate broker discriminated against them by the length of the exclusive listing contract Petitioners signed with Respondent (eight months); by inferior service because Respondent showed Petitioners' home only once in the eight months the contract was in effect1/; by incorrectly stating the agreed asking price on flyers Respondent circulated; by providing an "open house" to all of Respondent's other clients, but not to Petitioners; and by asking Petitioners to remove some of their bi-racial family photographs. Petitioner Donald Smith, Ph.D., is Caucasian. He is married to Miranda Smith, a dentist, who is African-American. They have at least one child, with whom they have been photographed. This case involves a house they owned on Cressida Circle in Spring Hill, Florida, where they displayed their bi- racial family photographs. On or about January 28, 2007, Petitioners signed, as sellers, an exclusive real estate listing contract with Kathlen Hobbs, a real estate salesperson, who at that time was an independent contractor associated with Exit Realty Shoppe. Respondent Montgomery, real estate broker, is the qualifying principal of Exit Realty Shoppe. Both Ms. Hobbs and Ms. Montgomery are Caucasian. The agreed asking price was $296,900.00. The term of the contract was for eight months: January 30, 2007, to October 1, 2007. Mr. Smith interviewed two other realtors, but he selected Ms. Hobbs and Respondent's proffered contract. It is a "fill-in the blanks contract," to which Mr. Smith had input. Although she signed the contract, Mrs. Smith did not speak to either Ms. Hobbs or Ms. Montgomery concerning the sale of the house at any material time. Mr. Smith testified that Ms. Hobbs initially told him that their home was "priced to sell" at $296,900.00, but he candidly admitted that Ms. Montgomery never made that representation and never "guaranteed" that the house would sell at that price. Upon the evidence as a whole and because Mr. Smith testified at one point that the other two realtors he interviewed told him the house would sell at "$295,000.00 or $296,000.00," and also testified contrariwise that Ms. Hobbs and the other two realtors told him the house would sell at "between $292,000.00 and $298,000.00," it is found to be more probable that no one guaranteed a sale at Petitioners' asking price of $296,900.00. Petitioners seek damages of $15,000.00, without stating any specific basis for that figure. They previously have sought $40,000.00, damages based upon the alleged lowered price of the house as sold by a subsequent realtor. However, the final date of sale and final sale price are not clear on this record. Paragraph Nine of the parties' contract provided for its early termination prior to its eight-month expiration date, upon the following terms: CONDITIONAL TERMINATION: At Seller's request, Broker may agree to conditionally terminate this Agreement. If Broker agrees to conditional termination, Seller must sign a withdrawal agreement, reimburse Broker for all direct expenses incurred in marketing the Property and pay a cancellation fee of $ plus applicable sales tax. Broker may void the conditional termination and Seller will pay the fee stated in paragraph 6(a) less the cancellation fee if Seller transfers or contracts to transfer the Property or any interest in the Property during the same time period from the date of conditional termination to Termination Date and Protection Period, if applicable. (Blank space in original; emphasis supplied.) Paragraph Six of that listing contract provides, in pertinent part: 6. COMPENSATION: Seller will compensate Broker as specified below for procuring a buyer who is ready, willing and able to purchase the Property or any interest in the Property on the terms of this Agreement or on any other terms acceptable to Seller. Seller will pay Broker as follows (plus applicable sales tax) 6% of the total purchase price OR $ , no later than the date of closing specified in the sales contract. However, closing is not a prerequisite for Broker's fee being earned. (Blank space in original.) Steve Van Slyke has been an active licensed real estate broker for over 20 years. For the last few years he has done more property appraisals than real estate sales. He has regularly taught and taken continuing education courses in the real estate profession since he was admitted to the profession in 1983. He has chaired the Professional Standards Committee of the Hernando County Association of Realtors (HCAR) since 1991. In that capacity, he has presided over hundreds of contract disputes between buyers and sellers, including the one that ultimately developed between the parties in this case. See infra. According to Mr. Van Slyke, the contract in this case is one commonly used in Hernando County, in the sense of not being unusual, but there are no "average," "usual," or "industry standards" for the duration of an exclusive real estate listing contract. He further testified that to have such a generally agreed-upon provision within the real estate industry would run afoul of the United States Fair Trade Commission's jurisdiction of, and prosecution for, "price-fixing." For the same reasons, there is no established average, usual, or industry standard for the conditional early release of a homeowner from a listing contract. Because no dollar amount for a cancellation fee had been written into Paragraph Nine of the parties’ contract herein, Mr. Van Slyke interpreted Paragraph Nine and Sub- paragraph Six (a) together, to permit Respondent broker the latitude to require payment by the sellers of six percent of Petitioners’/sellers’ asking price as a condition of early termination of the contract upon their unilateral request. Respondent submitted in evidence a similar contract dated March 5, 2007, between Respondent and a different homeowner for the duration of one year (12 months) from that date.2/ Petitioners presented no other contracts between any seller and Respondent or, for that matter, between any seller and any other realtor which specified a duration of less than eight months.3/ It is accepted that a different realtor with whom Petitioners contracted in November 2007, after their eight- month contract with Respondent had expired, filled-in “$500.00” in the equivalent Paragraph Nine, but there was no competent, credible evidence that this replacement realtor, or any other realtor for that matter, had a similar arrangement with any other sellers. Petitioners and Ms. Hobbs agreed that Ms. Hobbs would not submit Petitioners' sellers' contract on their existing home to Respondent until she got an acceptance on their offer as buyers for a new house on Rudolph Court. Accordingly, the listing contract for the Cressida Circle house in which Petitioners were living, and which contained their furniture and photographs, was not submitted to Respondent at least until January 31, 2007. Accordingly, Respondent could not begin attempts to sell Petitioners' existing home until the next day, February 1, 2007. There are 185 realty firms in Hernando County. There are four printed real property advertising booklets which are circulated in Hernando and surrounding counties. Each booklet is published every 30 days. The lead time to get a photographic advertisement of a newly listed property into each publication is three weeks. Before a photo can be published, it has to be made. On or about February 1, 2007, Ms. Hobbs photographed Petitioners’ Cressida Circle house for purposes of advertising it via websites, flyers, real estate advertising booklets, and newspapers, and placed Respondent’s "for sale" sign and lock-box on Petitioners' lawn. Respondent had admitted in evidence the first advertisements she paid for in three printed real estate booklets ("Nature Coast", March 22-April 18, 2007; "Real Estate News", April 2007; and "Sunshine Living", April 2007). Each advertisement contained a photograph and information extolling the Cressida Circle house. Each advertisement correctly quoted Petitioners' asking price of $296,900.00. Additionally, Respondent had admitted in evidence documentation showing that from March 22, 2007, until the end of her exclusive listing on September 30, 2007, she had advertised Petitioners' property repeatedly and/or consistently via newspaper, real estate advertising booklets, and/or Multiple Listing Services (MLS) websites and commercial websites. Both parties agree that Ms. Hobbs' first printed flyer stated an incomplete, and thus incorrect, selling price of "$296,90.", and that this flyer was circulated and/or placed in the lock-box tube on the "for sale" sign about February 1, 2007. (See Finding of Fact 17.) Despite Petitioners' claim that this was "inferior marketing," it is probable that most serious home seekers would have figured out how to correctly read the price as "$296,900.00", or would have asked what price was intended when phoning for an appointment to view the house. While Ms. Hobbs' flyer was never corrected, Respondent Montgomery had other, correct flyers printed, and she placed and circulated those correct flyers for the remainder of the contract period. It is customary for Exit Realty to conduct a "caravan" shortly after a contract is signed. A "caravan" involves Ms. Montgomery and all the salespeople she can round-up in her office. The entire team tours a seller's home, making notes, and then returns to Respondent's office, where a list of repairs and upgrades is compiled with each salesperson's in-put. Then the team brain-storms to develop selling techniques customized to each property listed. On February 7, 2007, the day before Caravan Day, an independent contractor with Exit Realty showed Petitioners' home to a potential buyer. Through Ms. Hobbs, the salesperson relayed to Mr. Smith that the potential buyer had remarked that the house's exterior paint was unacceptable. Mr. Smith told Ms. Hobbs that he would paint the house at his own expense if the potential buyer would make an offer, but no offer was forthcoming. Respondent's caravan viewed Petitioners' home on February 8, 2007. As a result, a list of selling suggestions was relayed by Ms. Hobbs to Mr. Smith. A day or so after Caravan Day, Mr. Smith was told by Ms. Hobbs that to best present and sell Petitioners’ home, Petitioners needed to deal with dirt and dust in an exhaust fan; replace a broken tile in a bathroom, and refinish their swimming pool. Mr. Smith also acknowledged that on the same date, or minimally later, he was told by Ms. Hobbs to remove Petitioners' large family photographs over the sliding doors opening from the house's vaulted-ceiling living room onto its screened patio and pool area. According to Ms. Montgomery, she had advised Ms. Hobbs to relay this information and additional advice, including the information that Petitioners’ house would sell better if Petitioners moved out or reduced the amount of furniture in the living room, so that potential buyers could visualize their own belongings in the room. It was not proven one way or the other whether Ms. Hobbs relayed the "move out" or "remove furniture" suggestions at that time. When Mr. Smith pressed Ms. Hobbs as to why the family photographs had to be removed, she referred him to Ms. Montgomery, who "could better explain." Mr. Smith acknowledged that Ms. Hobbs never said anything about race or discrimination. Mr. Smith testified to three versions of why he concluded that Ms. Montgomery was discriminating against Petitioners on the basis of race: first, because neither Ms. Hobbs nor Ms. Montgomery mentioned the bi-racial family photographs until after Ms. Montgomery had first seen them on Caravan Day, and Ms. Hobbs could not explain to his satisfaction the reason for removing the photographs; second, because Ms. Montgomery did not immediately return his phone calls; and third, because when Ms. Montgomery did return his phone calls, she mentioned the photographs over the sliding doors repeatedly among several other upgrades she encouraged him to accomplish, all of which upgrades Ms. Hobbs apparently had not passed along to him. Ms. Montgomery can suggest and encourage her independent contractors to pass on certain information to sellers and buyers and to pursue sales in certain ways, but she has no way to compel them. Mr. Smith conceded that at no time did Ms. Montgomery ever mention race or make any overt discriminatory statement to him and that she responded to all his letters, even though she did not agree with him in those letters. See, infra. Petitioners also agree that at no time did Ms. Montgomery or anyone associated with Exit Realty suggest that Petitioners remove tastefully framed bi-racial family photographs displayed on a bedroom dresser. Ms. Montgomery credibly testified that successfully "staging" a home for sale usually requires removing as much furniture as possible and all of the personalization, such as awards and photographs hung on the walls of all rooms. Mrs. Smith acknowledged that she was familiar with this concept from print literature and television. Ms. Montgomery demonstrated, using a photograph she had taken of the house without the wall photographs in place, that anything mounted above the living room's sliding glass doors had the potential to draw a shopper's eye away from the luxuriant sweep of the vaulted-ceiling and away from the scope and sweep of the view, through the sliding glass doors, of Petitioners' pool and patio. Petitioners accomplished the three repair suggestions (exhaust fan; tile; and swimming pool) that Ms. Hobbs passed on to them, but they remained in the Cressida Circle house and did not remove their furniture or the photographs above the sliding glass doors. In early March, Petitioners requested a reduction in the six percent commission specified in their Cressida Circle contract with Respondent. Respondent declined to consider reducing her commission until someone made an offer to buy. Petitioners closed on their new home on Rudolph Court on March 30, 2007. The Rudolph Court sale and closing in which Petitioners were buyers, was also handled by Hobbs, Montgomery, and Exit Realty. Petitioners do not claim that any racial discrimination by anybody occurred in the process of buying their new home. Closing on the Rudolph Court house left Petitioners with two houses to maintain and at least two (possibly four) mortgages to pay. Petitioners became concerned that no one had made an offer on their Cressida Circle house. Mr. Smith made several telephone calls to Ms. Montgomery. She did not immediately return those calls. When she did return Mr. Smith's phone calls, Ms. Montgomery explained to him that the Cressida Circle house needed to be "staged" better, including removing furniture and the photographs over the patio doors. Ms. Montgomery wrote Mr. Smith on April 5, 2007, to memorialize all of their April 4, 2007, conversation, giving him clear advice that a “lease/purchase procedure,” as opposed to a “lease/option to buy” arrangement which he had proposed, would be a better and safer solution for his needs. She also advised him that no home in his sub-development had been sold in the last seven months, and emphatically advised him to lower his asking price to $269,900.00, due to the competition of other similar homes for sale. It is undisputed that the parties' contract was signed during a "housing market slump" and that the housing market continued to decline during the entire term of the parties' contract. On April 9, 2007, Mr. Smith wrote Ms. Montgomery, making no reference to race or discrimination, but complaining about Exit Realty Shoppe showing his home only one time, requesting to void their contract, and closing with: If necessary we will follow thru [sic.] with a complaint to the Florida Real-estate [sic.] Commission in Tallahassee. Not unreasonably, Ms. Montgomery regarded Petitioners' foregoing letter as a threat. She responded by registered mail on April 10, 2007, setting out in detail all she had done and describing the costs she had incurred as of that date to sell the Cressida Circle house. She enclosed three printed real estate publications advertising Petitioner's house (see Finding of Fact 18); proof that the home was being advertised with the correct price April 7-13, 2007, in the St. Petersburg Times; proof that she had registered the house with the correct price on the MLS; and proof that the house was being shown in color on Exit Realty's three websites and on Ms. Hobbs' personal website with the correct price. She also reminded Mr. Smith that she had, earlier in the week, suggested that Petitioners reduce their asking price by $30,000.00, to $269,900.00. She also advised him, and included information showing, that as of that writing, there were 11 comparable listings in his sub- development, nine of which were listed at less than Petitioners' asking price. Evidence of all of Respondent's foregoing April 10, 2007, assertions was introduced in evidence by Respondent at the final hearing.4/ Respondent's April 10, 2007, letter also explained "staging," and offered to conditionally release Petitioners from their contract for six percent of their $296,900.00 asking price, as per the contract's Paragraph Six (a). Ms. Montgomery's April 10, 2007, unopened letter and supporting documentation were returned to her by the U.S. Mail as "unclaimed." Because Petitioners were still residing at the Cressida Circle address and because the post office did not mark the envelope "refused," it is probable that Petitioners simply did not go to the post office to sign-for, and pick up, Ms. Montgomery's material. However, Petitioners must have received these items because Ms. Montgomery also had the same materials delivered by messenger to Mrs. Smith’s office. Also, on April 11, 2007, Mr. Smith wrote, acknowledging receipt of Respondent's April 10, 2007, letter, refusing to reduce the asking price, and advising Ms. Montgomery that: I feel that it will be my responsibility to express this dissatisfaction in anyway [sic] I can, to as many people as I can. I will do what ever [sic.] I can do to be released from our agreement. He further threatened to contact "different government agencies" to report what he described as very poor service, but he did not mention race or discrimination. On or about April 19, 2007, Mr. Smith filed a complaint against Respondent dated April 16, 2007, with the local Better Business Bureau (BBB). His complaint alleged lack of service. Nowhere in his complaint is race or discrimination mentioned. The material in evidence shows that the BBB contacted Ms. Montgomery about the complaint, but marked it "information only," and did not pursue it at that time.5/ In early April 2007, Mr. Smith telephoned Ed Carr, Executive Director of the Hernando County Association of Realtors (HCAR). Mr. Smith said nothing to Mr. Carr about racial discrimination at that point, but said only that he wanted to get out of the listing contract with Respondent. On or about April 23, 2007, Petitioners filed a formal complaint with HCAR. HCAR's Grievance Committee met May 7, 2007, and, apparently in the mode of a probable cause panel, referred the case for a full evidentiary hearing. On June 29, 2007, the case was first noticed for hearing by HCAR. Petitioners’ HCAR complaint is not in evidence, and the evidence herein falls short of enabling the undersigned to determine whether the complaint before HCAR involved racial discrimination. However, it is certain that Ms. Montgomery perceived it that way. The HCAR hearing was first scheduled to occur August 28, 2007, but it was re-scheduled. The actual date the hearing took place and the date HCAR issued its decision are not clear in this record, but the hearing was on or after October 23, 2007. Mr. Van Slyke presided over the HCAR hearing. The HCAR decision resulted in a determination that Respondent had not violated professional real estate ethics. Despite Petitioners’ expressed dissatisfaction with HCAR's result and their claims that HCAR’s panel was prejudiced in Respondent's favor and that Respondent manipulated timing of the hearing, the HCAR process, and its deciding body, there is no competent, credible, or compelling evidence herein demonstrating the validity of such accusations or demonstrating that HCAR’s decision in Respondent’s favor was based on racial discrimination or constituted a cover-up for racial discrimination. That said, HCAR's decision is not binding here. Ms. Montgomery testified credibly that she had refused to acquiesce in any overt action, such as voluntarily letting Petitioners out of their contract without paying her commission, because to do so might make her appear to be prejudiced. Even more credible is her testimony that she did not want to let Petitioners out of their listing contract unless they paid her commission and costs, as provided in the contract, because she had already expended considerable time and money on Petitioners' behalf. Respondent continued to advertise the Cressida Circle house until the end of the eight-month contract (see Findings of Fact 19 and 40), despite Petitioners’ refusal to allow Respondent to reduce the asking price. Unfortunately, between June 14, and July 1, 2007, Respondent advertised an incorrect and lower asking price of $269,900.000, in "Nature Coast." Respondent did not know how the error occurred. The advertising for this two-week period was, as always, at Respondent's expense, and the asking price was corrected in the next issue. While signed-up with Respondent, Mrs. Smith took material prepared by Respondent for marketing the Cressida Circle property, made minor adjustments to it, and placed it on her own and others' websites. The material she posted sometimes carried Ms. Hobbs' contact information. Other times, Mrs. Smith's internet advertisements showed a reduced price for contacting Petitioners. This placed Petitioners in direct competition with Respondent's advertisements in which Petitioners required that Respondent maintain the original $296,900.00, asking price. In so-doing, Petitioners may have offended a clause of the listing contract. In placing this information on MLS websites outside of Respondent’s general geographic area, Petitioners may have exposed Respondent to liability in the professional real estate community. Respondent advised Petitioners of these problems, but there is no clear evidence that Respondent intervened to prevent Petitioners' behavior. Petitioners moved into their new, Rudolph Court house in early June 2007. When they moved, their furniture and photographs went with them. Photographic evidence shows that Petitioners allowed the Cressida Circle house to deteriorate after they moved to Rudolph Court, thereby rendering the sale property less desirable to potential buyers. Petitioners each testified credibly that between January 31, 2007, and the time they moved out, probably about June 6, 2007, Respondent gave them no advance notices that a potential buyer was coming to view the Cressida Circle house, as had been agreed upon when the house was listed. The sign-in sheet left in Petitioners’ sale house demonstrated that Exit Realty showed the house once, on August 21, 2007. Petitioners acknowledged that the home was also shown another time on the day before Caravan Day. (See Finding of Fact 22.) Respondent produced her lock-box's recorded printout showing that on February 1, 2007, Ms. Hobbs entered the house. (See Finding of Fact 17.) It shows also that Ms Hobbs entered again on June 7, 2007. On July 17, a ReMax salesman entered. On July 27, Respondent entered. On July 31, an ERA saleswoman entered. On August 10, and 11, Respondent entered. On August 21, another Exit Realty saleswoman entered. (See Finding of Fact 55.) On September 20, Clara Ward, an independent contractor with Exit Realty entered. (See Finding of Fact 58.) On October 4, 2007, Ms. Hobbs entered. Respondent acknowledged that on one or two of the foregoing occasions, she entered the sale house, not to show the property to prospective buyers, but to take photographs for the HCAR hearing (see Finding of Fact 47), but there is no credible evidence to support Petitioners' conjecture that the other visits by Ms. Montgomery and by all other real estate salespersons were not for the purposes of showing the house or for some other legitimate sales purpose. Clara Ward testified that she showed the house to a legitimate potential buyer about a month before Respondent's listing ended, and again in approximately December 2007, after Petitioners had listed it with another realtor at the reduced price of $256,900.00. Mr. Smith admitted that he never asked Ms. Hobbs for an "open house," until June 2007. The contract does not require an "open house." Ms. Montgomery testified credibly and without refutation that she did not schedule an "open house" for Petitioners because, in the past, "open houses" have not resulted in sales for her. She rarely, if ever, utilizes them for any property. Mr. Smith admitted that Petitioners had no evidence to support their allegation that every other home that Exit Realty signed in the same period was shown more than once. Petitioners also presented no evidence that every other home, besides the Cressida Circle home, which Exit Realty signed in the same period held even one open house.6/ In November 2007, Petitioners signed with another realtor who marketed the house at $269,900.00, which was $27,000.00 less than the only figure at which Petitioners would permit Respondent to market the house. If and when there was a sale is unclear.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Commission on Human Relations enter a final order dismissing the Complaint and the Petition for Relief. DONE AND ENTERED this 19th day of September, 2008, in Tallahassee, Leon County, Florida. S ELLA JANE P. DAVIS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 19th day of September, 2008.
The Issue The issue is whether Respondent is guilty of committing a discriminatory housing practice against Petitioners, based on their national origin, in violation of the Florida Fair Housing Act, sections 760.20-769.37, Florida Statutes.
Findings Of Fact In 2006, Petitioners purchased the single-family detached residence located at 1360 Northeast 41st Place in Homestead, Florida. The home is located behind an access gate that requires a card to operate. The card is serviced by Respondent through its management company, The Continental Group. Petitioners claim that Respondent's harassment forced them to move out of their home in October 2012. It is likely, though, that the timing of their relocation was influenced by a foreclosure judgment entered on March 7, 2012. The foreclosure judgment calculated interest on the unpaid mortgage note from September 1, 2008, suggesting that Petitioners had not made mortgage payments for the four years immediately preceding their moving out of the house. Petitioners' residence is subject to a declaration of covenants and bylaws. Respondent and The Continental Group are responsible for enforcing the provisions of these homeowner documents. Petitioners have a long history of violations of the homeowner documents dating as far back as at least late 2008. A notice dated December 31, 2008, advised Petitioners of a noncompliant lease. Notices dated June 30 and December 15, 2009, advised Petitioners that their landscaping lacked mulch. Notices dated August 10 and 25, 2009, advised Petitioners of a vehicle blocking the sidewalk. A notice dated September 24, 2009, advised Petitioners of a driveway that required pressure- cleaning. The notices became more numerous in 2010 and 2011. Claimed violations included an oil stain on the driveway, mildew on one or more exterior walls, and more landscaping issues, almost all of which involved shrubs that needed trimming. On occasion, the inspector cited the failure to trim dead branches or small amounts of grass growing between driveway pavers, but, mostly, she cited the failure to trim live vegetation. The evidentiary record contains 18 citations for overgrown shrubs, even though the photographs that are part of the citations reveal only a conventional foundation planting under the front windows that at no time extends above the bottom of the window frame. There are seven citations for grassy driveway pavers, although only one photograph clearly reveals any such grass--perhaps one linear foot of a few blades of grass wedged between a few pavers immediately in front of the garage door. A similar pattern of citations extended into 2012. Petitioners do not ground their claim of discrimination of these violations, though. Respondent produced a thick written summation of citations and fines that it imposed on homeowners in 2011-12, and Petitioners do not stand out in this document. Respondent clearly enforced the homeowner documents closely, so all that can be gleaned from Petitioners' long citation history is that relations between Petitioners, on the one hand, and Respondent and The Continental Group, on the other hand, may have been strained at times. In any event, the evidentiary record discloses that Petitioners were fined 17 times for untrimmed shrubs and 11 times for failing to remove the mildew from exterior walls. This record of fines is illustrative, not exhaustive. Petitioners believe they have been fined about $10,000. Regardless whether this figure is correct, Petitioners have been fined a substantial amount of money, but they have never paid any of these fines. Petitioners also failed to stay current on their homeowner assessment and maintenance fees. By August 12, 2011, Petitioners overdue balance on these items totaled $1,145 plus another $1,000 in costs in connection with filing a lien against their residence. In mid-August 2011, Respondent sent a notice to all homeowners that their access cards would be deactivated, necessitating the reregistration of the vehicles and recoding of their cards. The notice warned that Respondent would recode only the cards of residents who were current with their maintenance fees. Shortly after receiving this notice, Petitioners visited the management office to reregister their two vehicles and have The Continental Group recode their two access cards. Petitioners first met Ivan Arguello, who is an administrative assistant for The Continental Group. Mr. Woolley presented his access card to Mr. Arguello, so he could recode it. Pursuant to Respondent's policy, Mr. Arguello checked Petitioners' account and found them delinquent, so, again pursuant to Respondent's policy, Mr. Arguello informed them that he could only activate one card, not both cards, unless they paid their balance in full or entered into a payment plan approved by Respondent or its attorney. Mr. Woolley was irate and retrieved his card from Mr. Arguello. Mr. Woolley proceeded to address the issue with Mr. Arguello's supervisor, Mr. Gonzalez, who, at the time of the hearing, no longer was employed with The Continental Group. Petitioners stepped into Mr. Gonzalez's office, which was near the desk occupied by Mr. Arguello. Mr. Woolley and Mr. Gonzalez became angry and argued loudly. Although Mr. Woolley was aware that he could have obtained the recoding of one card, he was unwilling to accept this offer and instead left without the recoding of either card. All of the evidence offered by Petitioners' witnesses of the inconvenience posed by having no access card was entirely attributable to Mr. Woolley's decision not to accept the offer to recode one of his and his wife's two cards. At no time after this confrontation in the office did either Petitioner ever ask an employee of The Continental Group or Respondent to recode one of their access cards; Mr. Woolley merely retained an attorney to pursue the matter. For their part, Mr. Gonzalez did not direct Mr. Arguello to recode one of Petitioners' cards, nor did Mr. Arguello choose to do so on his own. The policy of the management company or Respondent was to require that the resident produce the card to be recoded, and Mr. Woolley had done that when he had handed his card to Mr. Arguello. Although Mr. Woolley left with his card, the actual recoding required Mr. Arguello, who had noted the card number, only to enter some information on his computer. Under Respondent's policy, Petitioners were entitled to the recoding of one of their cards. Under Mr. Arguello's personal policy, which he testified that he has applied to other loudly confrontational residents, he would not recode a card of a vocally abusive resident. When asked if the resident had to return to the office "contrite," Mr. Arguello answered: "No, no. They just have to come back not yelling." Tr. 57-58. No evidence suggests that the failure of The Continental Group to recode the one card was due to discrimination based on national origin. Petitioners alleged that The Continental Group and Respondent selectively enforced these policies against Petitioners, but they produced absolutely no proof to support this claim, even as to Mr. Arguello's personal policy. At the time of the incident in the office, Petitioners had already incurred a number of unpaid fines and maintenance fees. When Mr. Woolley became irate at the prospect of being restricted to a single access card, despite his failure to meet all of his financial obligations to the community association, it is an easy inference that Mr. Gonzalez and Mr. Arguello found Mr. Woolley's attitude inappropriate and decided not go out of their way to help Mr. Woolley, such as by activating one of his cards, unless he asked again in a more civilized fashion. Essentially, the only evidence of discrimination in this case is that Petitioners are Haitian, they did not get two access cards when they visited the management company's office, and The Continental Group did not complete the recoding of one of their cards after they left the office. Respondent argues that none of the representatives of Respondent or The Continental Group knew that Petitioners are Haitian. Certainly, this is the testimony of these witnesses. Both petitioners are dark-complected and speak English with a French accent, but it is unnecessary to determine if these facts are sufficient to support an inference of a different national origin because two additional facts stand between Petitioners and a prima facie case. First, even if The Continental Group employees knew that Petitioners are Haitian, there is no evidence of discrimination based on this place of origin. There is no evidence that Mr. Arguello or Mr. Gonzalez treated Petitioners differently from other residents who did not pay their fines and fees when it came to recoding access cards. This is true as to Respondent's policies and Mr. Arguello's personal policy. Second, there is no proof of any harm to Petitioners that they did not cause to themselves. At any time, in a normal tone of voice, they could have obtained a single access card, but they chose not to do so. If Mr. Arguello had not implemented his personal policy, Respondent perhaps could have proved that Petitioners commenced this proceeding for an improper purpose--namely, to harass Respondent. Respondent's policies restricting the availability of access cards based on whether residents were current on their obligations to the community association was written and disseminated among the residents. Thus, if Petitioners' claim of discrimination had been based exclusively on the implementation of these sensible, written policies, they might have exposed themselves to paying Respondent's reasonable attorneys' fees and costs. However, Mr. Arguello's implementation of his personal policy--while understandable--raises a different issue in requiring the analysis of the intent and effect of another tier of decisionmaking by Respondent or, in this case, The Continental Group. Ultimately, as noted above, Mr. Arguello's implementation of his personal policy does not support a finding of a prima facie case of discrimination, but his policy's subjective standard makes the inference of an intent to harass on the part of Petitioners more difficult to make--to the point that such an inference cannot be made.
Recommendation It is RECOMMENDED that the Florida Commission on Human Relations enter a final order dismissing the Petition for Relief. DONE AND ENTERED this 30th day of January, 2013, in Tallahassee, Leon County, Florida. S ROBERT E. MEALE 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 January, 2013. COPIES FURNISHED: Denise Crawford, Agency Clerk Florida Commission on Human Relations Suite 100 2009 Apalachee Parkway Tallahassee, Florida 32301 Cheyanne Costilla, Interim General Counsel Florida Commission on Human Relations Suite 100 2009 Apalachee Parkway Tallahassee, Florida 32301 Margaret H. Mevers, Esquire Teresita M. Perez, Esquire Lydecker | Diaz 19th Floor 1221 Brickell Avenue Miami, Florida 33131 Pierre Woolley Emmanuella Woolley 2033 Northwest 178th Way Pembroke Pines, Florida 33029
The Issue The issue is whether Respondent's, Diane Thompson, a licensed Florida real estate broker, license should be disciplined for fraud, misrepresentation, concealment, false promises, dishonest dealing by trick, scheme or device, culpable negligence, or breach of trust in any business transaction in violation of Section 475.25(1)(b), Florida Statutes.
Findings Of Fact Respondent, Diane Thompson, at all times material, was a Florida real estate broker, issued license number 0582890 in accordance with Chapter 475, Florida Statutes; was employed by Di-All Company, 5607 Interbay Boulevard, Tampa, Florida; and was subject to the regulatory jurisdiction of the Florida Real Estate Commission (Commission). Petitioner, Department of Business and Professional Regulation, Division of Real Estate (Department), has jurisdiction over disciplinary proceedings for the Commission. At the Commission's direction, the Department is authorized to prosecute administrative complaints against licensees within the Commission's jurisdiction. Diane Thompson, as the Listing Broker for Di-All Company, entered into a Residential Listing Contract (Listing Contract) with the seller (Metcalfe), for the exclusive right to secure a purchaser for Metcalfe's waterfront residential villa located at 2132 Cedar Drive, Dunedin, Florida, at an asking price of $350,000. The Listing Contract was effective June 28, 1998, with an expiration date of May 28, 1999. For procuring a purchaser of this property, Diane Thompson was entitled to a brokerage fee totaling seven percent of the sale price, with a minimum fee of $2,500, plus a closing fee of $145. The Listing Contract provided for Diane Thompson to receive a commission should the property be sold by and through another broker or agent during the exclusive listing period of April 9, 1999, through October 19, 1999. Diane Thompson procured the exclusive Listing Contract for Di-All Company. Both are identified collectively in the Listing Contract as the "Listing Agent." The District Six Residential Profile Sheet, signed by Metcalfe on October 19, 1998, extended the exclusive Listing Contract's original expiration date from October 19, 1998, to October 19, 1999. Initially unknown to Diane Thompson and at some time after execution of the exclusive Listing Contract, Metcalfe granted power of attorney to sell her waterfront residential property to her daughter, Pam Houle. Through that power of attorney, Pam Houle contracted with another broker and eventually sold Metcalfe's waterfront property. Because of that sale, Diane Thompson was not paid the Listing Agent's commission as provided for in her exclusive Listing Contract with Metcalfe. Attempts by Diane Thompson to resolve this dispute with Metcalfe, with Pam Houle, and with Pam Houle's attorney failed. At some time in June of 1998, Julie Johnson and a male friend flew from New Hampshire to Florida. The intent and purposes for their trip to Florida included looking for home sites and business sites as potential purchases. During her initial visit to Florida and on or about June 28, 1998, Julie Johnson appeared at Diane Thompson's home/office in response to Diane Thompson's media advertisements listing Metcalfe's waterfront property for sale. Responding to Julie Johnson's interest as a potential buyer of waterfront properties, Diane Thompson drove Julie Johnson to 2123 Cedar River, Dunedin, Florida, Metcalfe's waterfront residential villa. After showing Julie Johnson this property and after Julie Johnson's inspection of this residence, Diane Thompson drove Julie Johnson back to her office. At her office, Diane Thompson prepared the offer to purchase Metcalfe's property ("Residential Sale and Purchase Contract") and observed Julie Johnson sign her name to the offer to purchase document. Thereafter, and for the purpose of presenting Julie Johnson's offer to purchase to Metcalfe and/or to Metcalfe's agents for consideration, Diane Thompson made many attempts to contact Metcalfe, to contact Pam Houle, and to contact Pam Houle's attorney. Diane Thompson received no response from Metcalfe, no response from Pam Houle, and no response from Pam Houle's attorney. Because of Diane Thompson's lack of success to make contact with Metcalfe or her agents for the purpose of presenting Julie Johnson's offer to purchase, She did not request that Julie Johnson pay the $1,000 deposit, identified on the offer to purchase contract as the "Purchase Price (a)." Following her failure to make contact with Metcalfe, Diane Thompson introduced Julie Johnson to Barbara Larkins, a friend and real estate broker, who also listed waterfront properties for sale. At some period in 1999, Diane Thompson placed an advertisement for an Independent Contractor (licensed real estate person) in the local media. During the 1999 period when Diane Thompson's advertisement was in the media, Julie Johnson was present in Florida. Julie Johnson became aware of Diane Thompson's advertisement for an Independent Contractor and personally responded to the advertisement notice. Julie Johnson's response to Diane Thompson's advertisement was the second meeting of Diane Thompson and Julie Johnson. In October of 1999, Julie Johnson secured her Florida real estate license. On December 21, 1999, Julie Johnson signed an Independent Contractor agreement with Diane Thompson. Diane Thompson personally observed Julie Johnson sign her name to the Independent Contractor agreement. Julie Johnson signed her Florida driver's license, and a copy thereof was admitted into evidence establishing the fact that Julie Johnson's signature on the two documents and her signature on her Florida driver's license are not dissimilar. The waterfront property owned by Metcalfe, which Diane Thompson, as the Listing Broker for Di-All Company, had a Listing Contract for the exclusive right to procure a purchaser for Metcalfe's resident, was sold by and through another licensed real estate broker. When she became aware of that sale, Diane Thompson sought the brokerage commission as provided in her exclusive Listing Contract. Unable to resolve her dispute with Metcalfe, Diane Thompson filed a lawsuit in Pinellas County naming Metcalfe as defendant. During that circuit court proceeding, counsel for Diane Thompson proffered Diane Thompson's April 9, 1999, Residential Sale and Purchase Contract signed by Julie Johnson. In opposition to counsel for Diane Thompson's proffer, counsel for Metcalfe proffered Julie Johnson's December 19, 2002, affidavit that stated, in pertinent part: "On April 9, 1999, I was residing and working in Rochester, New Hampshire, while the signature is similar to mine, I do not recall having signed this document and never intended to make an offer to purchase Ms. Metcalfe's home."
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Commission enter a final order finding Respondent, Diane Thompson, not guilty of the charge brought against her and dismiss the Administrative Complaint filed in this proceeding. DONE AND ENTERED this 5th day of May, 2003, in Tallahassee, Leon County, Florida. FRED L. BUCKINE 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 5th day of May, 2003.
The Issue Whether Respondent acted fraudulently, arbitrarily, illegally, or dishonestly in its proposed rejection of all bids received in response to Request for Proposals, Lease No. 700:0819.
Findings Of Fact On May 10, 1999, the Respondent, Department of Corrections (Department), issued Request for Proposal, Lease No. 700:0819 (the RFP) for office space in Dade County for the Office for Probation and Parole Supervision. Petitioner, 7952 West 2nd Corporation, and Intervenor, Capital Group of Miami, Inc. (Capital), submitted the only responses to the RFP. Upon receipt of the proposals, Mr. Audwyn Francis, the Department's employee in charge of the RFP, believing the bids to be nonresponsive, contacted the Department's legal section for advice and for a determination of responsiveness. While waiting for the legal section to research and make a recommendation on the responsiveness of the proposals, because of time constraints, Department staff decided to proceed with the site visits and evaluation of the proposals but not to make an award until they received a decision from legal counsel concerning the responsiveness of the proposals. A site visit was conducted at the two proposed sites. The responses were evaluated according to the criteria in the RFP. Capital received a score of 98. 7925 West 2nd Corporation received a score of 92. The evaluation committee recommended that an award be made to Capital. Upon further review of the proposals by the Department's attorneys, it was determined that all of the bids were nonresponsive. Based on this determination, the Department rejected all bids. On page four, section A, paragraph seven, the RFP provides the following requirements relating to parking: A minimum of 50 on-site spaces for the exclusive use of the employees and clients at no additional charge to the leasee. Parking spaces must be under the control of the bidder and be suitably paved, lined, bumper pads installed, and labeled D.C. parking. At least two spaces must meet the requirements of the Accessibility Requirements Manual published by the Department of Community Affairs, latest edition. Parking area shall be well lighted and secure. Bidder shall provide a site plan identifying the number of parking spaces assigned to specific other tenants. The purpose of this submittal is to assure parking spaces requested in this RFP can be achieved without infringing on or combining with the parking requirements of other tenants. At the preproposal conference, Mr. Francis, advised the attendees that all attachments as indicated on pages 29 through 31 of the bid package must be included with the bid submittal. On page 30 the RFP requires the proposers to show proof of structures and parking control and directs the proposers to page 4, section A, paragraph 7 and page 23, section D, paragraph 7. Capital proposed to provide 43 parking spaces on-site and 7 parking spaces across the street. Capital's proposal was not responsive to the requirement of providing 50 parking spaces on-site. Petitioner included a document entitled "As-Built Survey" with its proposal. The survey showed the outline of the building on the site, but did not show any parking spaces. Petitioner stated in its proposal that it would provide 50 parking spaces. When Department staff arrived at Petitioner's site to conduct a site visit, they could not find a place to park. During the site visit, Robert Harrison, a representative of Petitioner, advised Department staff that Petitioner leased office space to another agency in the same building that was being offered to the Department. Mr. Harrison advised that he did not know the number of parking spaces to which the other agency was entitled to use. None of the parking spaces at the site were marked as being assigned to any tenant. As of the date of the Department's letter advising that it was rejecting all bids, Department staff were unaware of the total number of spaces available on the site and the number of spaces to which the other agency had exclusive use. After all the bids were rejected, Petitioner disclosed that it had a lease with the Department of Health and Rehabilitative Services (HRS) for space in the building in which it proposed to lease space to the Department. The lease provided that HRS had exclusive use of 150 parking spaces on- site. Petitioner further disclosed that it had a total of 250 parking spaces on-site. Petitioner failed to comply with the requirement that the proposer provide a site plan showing the number of spaces assigned for the use of the current tenant at the building. The Department utilizes a manual entitled "Competitive Proposals," which establishes the procedures to solicit and evaluate proposals. Section Seven of the manual pertains to the procedures to be followed by the Department when evaluating proposals and provides: All proposals will first be reviewed for conformance with the provisions specified in the RFP. Any proposal not in compliance with the terms of the proposal specifications shall not receive further consideration. The evaluation committee will analyze each responsive proposal to determine which proposal is the lowest and best in accordance with established provisions and award factors. . . . To be considered for award, a proposal must comply in all material respects with the RFP so that all proposers may stand on equal footing, with respect to the method and time frame of submission, and to the substance of any resulting lease. The proposal must result in a binding contract. Non-responsive proposals. Any proposal which fails to substantially conform to the requirements of the Request for Proposal. A proposal may not be considered if the proposer imposes conditions which would modify requirements of the Request for Proposal, or limit their liability to the State of Florida, giving them an advantage over other proposers. When a question of responsiveness is unclear the agency's legal counsel should be consulted. In the event no acceptable proposals are received, all proposal should be formally rejected by letter, sent by certified mail, return receipt requested. * * * F. Proposals which technically conform to the requirements of the Request for Proposal are considered to be responsive and may be accepted for consideration by the evaluation committee for determination of an award recommendation. The evaluation committee can seek clarifications as needed from any proposer. However, clarifications received from the proposer which change what was originally proposed cannot be considered in the evaluation. * * * Each committee member is to personally inspect the proposed facility, and evaluate the location and facility on the basis of the evaluation criteria contained in the specifications. When all committee members have individually assessed award factor points for each proposal, the entire evaluation committee will meet to review the individual evaluations and jointly develop a committee determination of the best proposal based on the overall factor ratings. * * * L. The agency has the right to reject any and all proposals when such rejection is in the best interest of the State of Florida. Such rejection cannot be arbitrary, but must be based on strong justification. Each person with a rejected proposal should be notified by certified mail return receipt requested.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED a final order be entered dismissing Petitioner's protest. DONE AND ENTERED this 29th day of February, 2000, in Tallahassee, Leon County, Florida. ___________________________________ SUSAN B. KIRKLAND 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 Hearings Filed with the Clerk of the Division of Administrative this 29th day of February, 2000. COPIES FURNISHED: Michael W. Moore, Secretary Department of Corrections 2601 Blairstone Road Tallahassee, Florida 32399-2500 Louis A. Vargas, General Counsel Department of Corrections 2601 Blairstone Road Tallahassee, Florida 32399-2500 Obed Dorceus, Esquire Department of Corrections 2601 Blairstone Road Tallahassee, Florida 32399-2500 Robert A. Sweetapple, Esquire Sweetapple, Broeker & Varkas 165 East Boca Raton Road Boca Raton, Florida 33432-3911 David A. Anthony, Esquire Law Offices of David A. Anthony 916 Catalonia Avenue Coral Gables, Florida 33134
The Issue Whether Respondents committed a discriminatory housing practice with regard to their tenant, Petitioner Harry Byrd, when they terminated his tenancy at the LaCoste Family Apartments?
Findings Of Fact Petitioner Harry H. Byrd is disabled due to an automobile accident more than a decade ago in which he suffered critical abdominal, chest and head injuries. He has recovered from these severe injuries with the exception of central nervous system deficiencies. The deficiencies are manifested in at least two ways: impairment of his mobility and impediment of speech. Impairment of Mr. Byrd's mobility requires he use the assistance of a walker or a wheelchair in order to move about. Generally able to communicate when speaking, on occasion, the impediment makes it difficult for his speech to be understood. In August of 1992, Mr. Byrd rented one of the apartment units, Unit No. 11, of LaCoste Family Apartments at 140 West Terry Drive in Pensacola, Florida. LaCoste Family Apartments is owned by LaCoste Family Apartments, Inc., a Florida corporation located in Escambia County. R. H. LaCoste was an officer and a shareholder in the corporation until his death sometime prior to the hearing in this matter. Sandra LaCoste Spann, also know as Sandra LaCoste, is the daughter of R. H. LaCoste and, for the past 15 years, has been the general manager of the apartments. As general manager, Ms. Spann is solely responsible for the day-to- day operations of the apartments, which number approximately 30 units. Her responsibility includes handling complaints and evictions. When Mr. Byrd rented the apartment, pursuant to LaCoste Family Apartment policy, he did not enter a written lease. His tenancy, therefore, was month-to-month. Ms. Spann told Mr. Byrd that at the end of seven months, if the tenancy were satisfactory, he would be offered and required to sign a year's lease in order to remain a tenant. Seven months has been chosen by management as a probationary period prior to entering a written lease because a tenancy on a month-to-month basis that lasted less than 7 months could result in the imposition of bed taxes pursuant to the Escambia County Bed Tax Ordinance. During the probationary period usually applied to a new tenant, LaCoste Family Apartments assesses the tenancy. At the end of the seven months, it does not offer the tenant a lease and provides notice of termination of the tenancy if dissatisfied with the tenant for any number of reasons, for example, if problems are encountered with payment of rent. Along Terry Street, there are sixteen apartment units located in four buildings. Parking for these apartments is on the north side of the buildings. As is the case in the building housing Unit 11, the parking facilities are simply an area to the north of the building; individual parking spaces are not separated physically or visually in any way. Typically, when prospective renters arrive at the apartments, Ms. Spann accompanies them to view the apartment. She also shows them the parking area in front of the apartment building. Just prior to August of 1992, Ms. Spann showed Unit 10 to Mr. Byrd. He had been inquiring about renting for several months. Ms. Spann recommended that Mr. Byrd not rent Unit 10, the entry to which was on the south side of the building, a building's-length away from the parking area. Rather, she recommended that he wait until Unit 11 became available, which she expected to happen shortly. Unit 11's front door faces the parking area making it easily accessible to the area, a feature Ms. Spann thought important to Mr. Byrd in light of his disability. Mr. Byrd followed Ms. Spann's recommendation. In the middle of August, 1992, he moved into Unit 11. Other than a request that the door to the bathroom be removed so that he could maneuver in and out of the room with as much ease as possible, Mr. Byrd made no special requests to management. Management honored the request and removed the door. Mr. Byrd only once complained about any problems with the apartment. It concerned difficulty with a doorknob. Mr. Byrd did not complain to the management about problems he was having with parking. Despite not complaining about parking difficulties, Mr. Byrd did, in fact, encounter several. Most of the difficulties he was able to solve himself. The parking area is on an incline. The incline, if an automobile is parked front end first closest to the apartment building, slopes from the front of the car to the back. When Mr. Byrd backed his 1987 Pontiac out of the parking area, the muffler struck the ground. He began to park at a 45 degree angle. Not only did this solve the muffler problem, but it assisted Mr. Byrd in putting his walker into the backseat or retrieving it while trying to keep his balance entering and exiting the car. The management did not have a problem with Mr. Byrd parking at a 45 degree angle. There were other parking issues Mr. Byrd was forced to face. Occasionally, his neighbors would park their cars in ways that made it difficult for him to park. When they saw him driving in, however, they moved their cars to accommodate him. Their courtesy kept the issue from being a problem for Mr. Byrd. On one occasion, however, Mr. Byrd's neighbors had a party. Cars were parked right next to his. He was unable to enter his own automobile because of the other cars and, therefore, was unable to leave the premises. Mr. Byrd did not complain about the incident to the neighbors or to management. Instead, he talked to Barbara Hoard, a representative with the Human Relations Commission. Ms. Hoard suggested that Mr. Byrd write a letter to management requesting a handicapped parking space. In addition, Ms. Hoard contacted Sergeant Richard L. Benfield, a parking enforcement specialist with the Escambia County Sheriff's Office. On March 9, 1993, Ms. Hoard asked Sergeant Benfield to check the LaCoste Family Apartments to see if handicapped parking facilities were required or would need to be provided. On March 10, 1993, Sergeant Benfield examined the premises. He determined that there were no requirements under state law or county ordinance that required LaCoste Family Apartments to provide a marked handicapped space. He then contacted Mr. R. H. LaCoste and informed him of the findings. Sergeant Benfield did not speak with Manager Sandra Spann. On March 11, 1993, Mr. Byrd, wrote the letter suggested by Ms. Hoard. Addressed to Mr. R. H. LaCoste, the letter, in part, states, Due to the disability caused when I was injured in a car accident ten years ago, I am in need of a reserved parking space in front of my apartment, Unit 11. This accommodation will allow me to have unrestricted access to my apartment. I hereby wish to request this reasonable accommo- dation and am placing this request to you in writing. Pet.'s Ex. No. 2. Mr. Byrd attempted to deliver the letter in person to Mr. LaCoste, first, at the apartment management office. Finding Mr. LaCoste not present, Mr. Byrd drove to Mr. LaCoste's home. Mr. LaCoste was not at home, but Mr. Byrd made the delivery to his wife, Mrs. LaCoste, with whom he spoke for about 10 minutes. The following day, March 12, 1995, Mr. Byrd received a notice signed by Sandra Spann. The notice stated, "Your rental is terminated and ... no further rent will be accepted." It also stated that Mr. Byrd was not under a lease, that Ms. Spann needed possession of the apartment and that, since Mr. Byrd was "on a month to month basis, by law [he was being given] this fifteen day written notice to vacate the premises." Pet.'s Ex. No. 3. The coincidence of the delivery of the "termination" notice the very day after Mr. Byrd's written request for a reserved space and two days following Sergeant Benfield's visit to the premises and discussion with Mr. LaCoste, led Mr. Byrd to conclude the tenancy was being terminated because he had made the request. Furthermore, he felt he was being discriminated against because of his handicap. These conclusions were bolstered in Mr. Byrd's mind by the fact that he had never been late in paying his rent, one of the primary reasons management would consider terminating a tenancy during or at the end of the seven-month probationary period. Despite the coincidence, however, Mr. Byrd's tenancy was not terminated because of the request for a reserved parking space. The letter requesting the reserved parking space had not been seen by Ms. Spann prior to the delivery of the "termination" notice to Mr. Byrd. Nor did Ms. Spann speak to her father or her mother about the letter until after she had delivered the notice. She did not learn of the letter until approximately 2 hours after she delivered the notice to Mr. Byrd's apartment, when her father arrived at the apartment complex around 10 in the morning on March 12. Furthermore, Ms. Spann did not learn of Sergeant Benfield's visit to the complex until her conversation with her father about Mr. Byrd's letter the morning of March 12, again some two hours after delivery of the notice. The timing of the termination letter was prompted by a complaint from Bernice Smart, a tenant of the complex for over four years. Ms. Smart informed Ms. Spann that she would move out if something was not done about Mr. Byrd. Ms. Smart was not the only tenant to complain about Mr. Byrd. In mid- autumn of 1992, Ms. Spann began receiving complaints from Mr. Byrd's fellow tenants. In the late fall complaints averaged about two a week. But, by January of 1993, the complaints grew more frequent. As Ms. Spann testified, Every time I'd turn around, go over, walk through the apartment complex, someone would always stop me and say that ... Harry [Byrd] had been bothering them and they wished I could make him quit coming over to their house and disturbing them. (Tr. 115). In addition to Ms. Smart, complaints about Mr. Byrd harassing them were made by tenants John Stallworth, Larry Hebert, Sam Thomas, and Keith McCaslin. Mr. McCaslin's sister, Cathy Shands, testified that while she lived in her brother's apartment, Mr. Byrd would come to visit, "a little too often." (Tr. 148). He called Mr. McCaslin on the phone, sometimes two or three times a day. In the meantime, Ms. Spann had had her own difficulties with Mr. Byrd. In addition to being general manager of the apartment complex, Ms. Spann also works with the family's electrician's business. She normally arrives at work at 6:30 in the morning to get the employees of the business off to their assignments. Shortly after he moved in, Mr. Byrd began calling in the morning around 7 a.m. while Ms. Spann was busy with the electricians. Sometimes the conversations would take 15 or 20 minutes because of her difficulty in understanding Mr. Byrd over the phone. Finally, she told him he would have to call her at another time if the purpose of calling was simply to talk. On other occasions, after Ms. Spann had back surgery in January of 1993, when Ms. Spann was visiting her boyfriend's apartment, Mr. Byrd would knock on the door, "wanting to know what took us so long to get to the door or what I was doing over there at that time of the night." (Tr. 116.) These visits by Mr. Byrd occurred as late in the evening as 10 o'clock. The experience by the LaCoste Family Apartments with Mr. Byrd is not the only experience of the apartment with disabled persons. Respondent, R. H. LaCoste, himself was handicapped, being a leg amputee with loss of 90 percent of his strength in both arms. In addition to Mr. Byrd, the complex has enjoyed the tenancy of at least four other handicapped tenants. One of these tenants, Mary K. Hardy, uses a walker. She has known Ms. Spann for six years and has never been treated by her with any discrimination. In fact, Ms. Spann has gone out of her way to see that Ms. Hardy was accommodated in light of her handicap. In sum, Mr. Byrd's tenancy was terminated, not because of the request for a reserved handicapped parking space or due to any discrimination, but because of numerous complaints received from other tenants that Mr. Byrd harassed them and because of Ms. Spann's personal experience with Mr. Byrd as a difficult tenant who acted inappropriately.
Recommendation Accordingly, it is RECOMMENDED: That the Florida Commission on Human Relations enter a final order dismissing Petitioner's claim of discrimination. DONE and ORDERED this 22nd day of August, 1995, in Tallahassee, Leon County, Florida. DAVID M. MALONEY 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 22nd day of August, 1995. APPENDIX Petitioner did not submit proposed findings of fact. Respondent's proposed findings of fact: Proposed Findings of Fact Nos. 1 - 56, and 58 -64, insofar as material, have been adopted. With respect to Finding of Fact No. 57, the finding is accepted insofar as it relates to state law enforced by Sergeant Benfield. To the extent the finding is a conclusion of law that no parking space would have been able to have been reserved for Mr. Byrd, the finding is rejected. It may very well have been that Section 760.23(9), Florida Statutes, required a reserved space as a "reasonable accommodation ... necessary to afford [Mr. Byrd] equal opportunity to use and enjoy [the] dwelling." By the time Mr. Byrd made the request, however, his tenancy was soon to terminate. Findings of Fact No. 66 - 78, are rejected as irrelevant given the recommendation in this order. COPIES FURNISHED: Austin B. Gran, Esq. Post Office Box 12691 Pensacola, FL 32501 Michael J. Stebbins, Esq. RAY, KIEVET & KELLY Post Office Box 13490 Pensacola, FL 32591-3490 Dana Baird General Counsel 325 John Knox Road Building F, Suite 240 Tallahassee, FL 32303-4149 Sharon Moultry, Clerk Human Relations Commission 325 John Knox Road Building F, Suite 240 Tallahassee, FL 32303-4149
The Issue Whether Respondent committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, or breach of trust in any business transaction as alleged in the Administrative Complaint in violation of Subsection 475.25(1)(b), Florida Statutes (2006).1
Findings Of Fact Petitioner is the state agency charged with the responsibility and duty to prosecute administrative complaints pursuant to Section 20.165 and Chapters 120, 455 and 457, Florida Statutes. Petitioner has jurisdiction over disciplinary proceedings before the Florida Real Estate Commission (FREC) and is authorized to prosecute administrative complaints against licensees within FREC’s jurisdiction. At all times material, Respondent was a licensed Florida real estate broker, license number 684990, under Chapter 475, Florida Statutes. The last license issued to Respondent was as a broker at Florida’s Best Buy Realty & Mortgage Lender, LLC, Post Office Box 551, Winter Park, Florida 32793. On or about February 15, 2007, Respondent entered into a contract to manage the single-family dwelling owned by Jacqueline Danzer. The property is located at 2979 Krista Key Circle, Orlando, Florida 32817 (Subject Property). The agreement was for the period February 15, 2007, until February 15, 2008. Respondent was authorized, under the management agreement, to seek a tenant for the property. Said management agreement authorized Respondent to be compensated at the rate of 10 percent of the rent due during each rental period. On or about March 27, 2007, Respondent negotiated a lease agreement with Veronica Valcarcel to rent the Subject Propery. The tenant applied through the federal Section 8 program, administered by the Orange County Housing and Community Development Division (Agency), for rental assistance in order to rent the Subject Property. Section 8 assists low-income families with their rent. A tenant who qualifies for Section 8 assistance is prohibited from paying more than 40 percent of his or her income for rent and utilities. On April 26, 2007, Respondent, acting on behalf of the landlord for the Subject Property, entered into and signed a “Housing Assistance Payment Contract” or “HAP” contract with the Agency as part of the Section 8 program. The HAP contract provided that for the initial lease term for the Subject Property (for the period April 1, 2007, until March 31, 2008), the initial monthly rent was $1,150 per month. This was determined to be the maximum payment the tenant could pay without exceeding 40 percent of her income. The HAP contract explicitly provides in its terms that “[d]uring the initial lease term, the owner may not raise the rent to tenant.” Respondent knew that he was prohibited from charging more than the monthly rent stated in the HAP contract. Respondent has had experience in the past with other tenants who participated in the Section 8 program. Respondent has previously signed other HAP contracts which contained the same restrictive language. Under the lease contract that the tenant Veronica Valcarcel signed with the property owner Jacqueline Danzer, the monthly rent would be $1,150 per month. The signature page in the lease contract is not the same page on which the monthly rental amount is written. The property owner Jacqueline Danzer asserts that the initials in the lease contract reflecting a monthly rental of $1,150 were not all her initials. Under the terms of the Exclusive Property Management Agreement, Respondent was being compensated at the rate of 10 percent per month after the first month. A monthly rental amount of $1,500 indicates that the property owner would receive a net of $1,350 per month. The property management agreement provided that Respondent would make payments to the property owner by direct deposit. The property management agreement lists a 12-digit bank account number, with the last four digits of “6034,” into which Respondent was to make direct deposits. At the hearing, property owner Jacqueline Danzer testified that she had received payments from Respondent for the Subject Property to her Bank of America savings account, with the account number ending in “6034.” The last four digits of the account number on the Bank of America Statement match the last four digits on the account number found on the Property Management Agreement. According to the Bank of America records, Respondent made the following payments to the property owner: a) $1,550 on May 9, 2007 b) $1,000 on May 9, 2007 c) $850 on June 12, 2007 d) $1,350 on July 11, 2007 e) $1,350 on September 10, 2007 On September 12, 2007, property owner, Jacqueline Danzer went to see Lois Henry, the manager of the Section 8 department for the Agency. During the course of that meeting, Dnazer advised that Respondent was collecting $1,500 a month rent from the tenant instead of $1,150 a month. On September 12, 2007, during the course of a telephone conference with Jacqueline Danzer and Lois Henry, Respondent admitted that he had been collecting $1,500 monthly rent for the Subject Property, retaining a commission of $150 and depositing the balance in Danzer’s account. Respondent denied making an admission during the telephone conference on September 12, 2007. He also denied that he was collecting $1,500 from the tenant, and further denied that he was violating Section 8 regulations. Respondent’s testimony is not credible. The witness Danzer’s testimony is credible. Petitioner has proven by clear and convincing evidence that Respondent violated the Housing Assistance Payments Contract. The total amount of investigative costs for the Petitioner for this case, not including attorney’s time, were $874.50.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Florida Real Estate Commission, enter a final order: Finding Respondent guilty of violating Subsection 475.25(1)(b), Florida Statutes; Revoking Respondent’s license, and imposing an administrative fine of $1,000.00; and Requiring Respondent pay fees and costs related to the investigation in the amount of $874.50. DONE AND ENTERED this 26th day of August, 2009, in Tallahassee, Leon County, Florida. S DANIEL M. KILBRIDE 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 26th day of August, 2009.
Findings Of Fact Petitioner owns Lot 70, Gates Knoll 1st Addition, which abuts a medical office complex of eighteen offices west of Lot 70. Off-street paved parking for the medical offices presently abuts Lot 70, but additional parking is needed. Lot 70 fronts on Barry Street, which is the only east-west through street in the immediate vicinity and is heavily travelled. Zoning for Lot 70 is "RS 50," which is single family residential. West of Lot 70 to Highland Avenue is zoned "PS," which would allow multiple family dwellings or business and professional services such as those for which the property is presently used. South of the area zoned "PS" the property adjacent to Gates Knoll 1st Addition is zoned "RM 28," which provides for high density multi-family use and just west of "RM 28" between that zoning and Highland Avenue the property is zoned "CS" for General Commercial use. A bowling alley is located in this area a short distance south of Barry Avenue. Lot 70 is currently fenced and the southern and western part of this lot is used for parking a few automobiles during business hours. The north side of Lot 70 is part of a drainage easement or ditch which occupies approximately 35 feet of this property. Lot 70 is 100 feet wide on Barry Street and 105 feet deep. The north 35 feet of this lot is unusable for construction due to the drainage easement. Adjoining property owners across Barry Street from Lot 70 oppose the special exception primarily because they want the lot to remain vacant to serve as a buffer zone between their property and the commercial development. Others oppose the application because they fear use of the property for anything except a single family residence will reduce their property values, increase the traffic in the neighborhood, and increase the noise and pollution from automobiles. Mr. Huff, the adjoining property owner whose home is immediately east of Lot 70 on Lot 71, is concerned about the proximity of the parked vehicles to his home. The existing fence is some ten feet from Huff's home.
Findings Of Fact In January, 1985, Petitioner acquired an existing retail florist business located at 416 Indiantown Road, Jupiter, Florida. Petitioner's business occupied one-half of the building located at that address. The remainder of the building housed La Casa Mexican Restaurant and a Metro Cellular Phone business. At the time that Petitioner acquired the business, the parking lot for the building consisted of 15 spaces and was shared by all three businesses. Six of those spaces were located behind the building and were accessible from an alley. Nine of those spaces, including the handicapped space, were located in front of the building and were accessible from Indiantown Road. The parking lot for the building constituted a legal non-conforming use, that is, it was permitted to exist without meeting current code requirements of the local government. The business lease entered into by the Petitioner on January 21, 1985, for a term of thirty months was essentially a "standard form" lease. However, Petitioner as Lessee and Petitioner's Lessor specifically added to the standard lease language a twenty-fourth clause which provided as follows: Twenty-Fourth: In the event Indiantown Road is widened during the term of this lease and the widening project results in a loss of more than two of the present ten [sic] parking spaces in front of the building, then the rental payments under this lease can be renegotiated by the parties, and if such renegotiations do not result in terms satisfactory to the tenant, the tenant will have the right to cancel this lease with thirty days notice to the landlord. Accordingly, Petitioner specifically retained the right to either stay or vacate the leased premises if the road-widening project resulted in a loss of more than two of the parking spaces in front of the building. The Department subsequently commenced its road-widening project which resulted in the Department's "taking" of two of the parking spaces in front of the building. The Department paid Petitioner's claim for business damages as a result of the loss of two parking spaces in the condemnation proceeding involving Petitioner and the property owner. After the loss of the two parking spaces, the front parking lot was re- designed so as to more closely comply with local code requirements. That re- design of the parking spaces reduced the number of spaces in front of the building by an additional two, resulting in a total reduction of parking spaces in front of the building by four. The re-design left a total of five spaces in front of the building, including a handicapped space. Although a local government can require a legal non-conforming use to be made conforming under certain circumstances, there is no evidence that the local government required the owner of the property leased by Petitioner to re- design the front parking lot according to code requirements. Accordingly, there is no showing that the deletion of the two additional parking spaces was a direct result of the road-widening project. On approximately July 1, 1991, Petitioner moved its retail florist business to 323 West Indiantown Road, Jupiter, Florida. Petitioner relocated its business at that time because Petitioner's president believed that business "...was at a point where it was just going to be falling off." (R. 37). The relocation of Petitioner's business was caused by Petitioner's decision to conduct its business from a different location. Petitioner did not move its business as a direct result of the Department's acquisition of two parking spaces. Accordingly, Petitioner is not eligible for relocation benefits.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered denying Petitioner's application for relocation benefits. DONE and ENTERED this 3rd day of November, 1993, at Tallahassee, Florida. LINDA M. RIGOT 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 3rd day of November, 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-7265 The Department's proposed findings of fact numbered 5-8 and 10 have been adopted in substance in this Recommended Order. The Department's proposed findings of fact numbered 1 and 2 have been rejected as being subordinate to the issues involved herein. The Department's proposed findings of fact numbered 3, 4, and 9 have been rejected as not constituting findings of fact but rather as constituting argument of counsel or conclusions of law. COPIES FURNISHED: Ben G. Watts, Secretary Department of Transportation Haydon Burns Building 605 Suwannee Street Attn: Eleanor F. Turner, Mail Station 58 Tallahassee, Florida 32399-0458 James R. Clodfelter Authorized Representative Acquisition Consultant Enterprises, Inc. Boca Bank Corporate Center 7000 West Palmetto Road, Suite 503 Boca Raton, Florida 33433 Charles Gardner, Esquire Department of Transportation 605 Suwannee Street, Mail Station #58 Tallahassee, Florida 32399-0458
Findings Of Fact The Respondent Marinatown Realty, Inc., is a corporate real estate broker, holding license number 0208680 and located at 3440 Marinatown Lane, Northwest, North Fort Myers, Florida. Marinatown Realty is a wholly owned subsidiary of Seago Group, Inc., a publicly held land development and rental corporation whose president is Thomas P. Hoolihan. In late 1977, Hoolihan met L. E. Hutchinson, the complainant in this case, through another broker for whom Hutchinson at the time was employed. In December, 1977, Hoolihan and Hutchinson discussed the marketing of two condominium projects being developed by Hoolihan and reached an oral agreement whereby Hutchinson would be paid $18,000 in salary with a 1 1/2 percent commission on all sales. When the condominium units were completed and mostly sold, the parties' employment agreement was revised in late December, 1979. Under the new agreement, Hutchinson was to receive $30,000 a year salary, commissions on the remaining condominium units that had not yet closed and any commissions on outside property listings neither owned nor controlled by Seago. In return for the $30,000 guarantee, Hutchinson was to forego commissions on future properties owned or controlled by Seago Group, Inc. During the period from 1977-1978 when Hutchinson was receiving $18,000 plus a 1 1/2 percent commission, sales were handled through Lee Hutchinson Realty, Inc., which held license number 0182945. In early 1979, Marinatown Realty was incorporated to market Seago's real estate inventory, to identify and list outside properties and to act as a management agent for purposes of renting condominium units previously sold in recent projects. When Marinatown Realty was formed, the complainant became its active broker. While employed as the broker for Marinatown and receiving $30,000 a year as a salaried employee, Hutchinson held two other broker's licenses, one as L. E. Hutchinson Realty, Inc., and another as L. E. Hutchinson. In January, 1980, Hoolihan agreed to pay a $15,000 bonus to Hutchinson in lieu of a salary increase. Since at that time sales were minimal, Hoolihan decided to pay the bonus in installments as sales occurred. Because Hutchinson left in May, 1980, he received only $10,000 of the bonus which represented moneys previously paid. On April 23, 1980, Hutchinson and Chuck Bundschu, a licensed real estate broker, negotiated and obtained a sales contract between Hancock Harbor Properties, Ltd., a wholly owned subsidiary of Seago Group, Inc., seller, and Frank Hoffer, buyer and licensed real estate broker, in which Hoffer offered to purchase approximately 3.16 acres of unimproved acreage for $500,000. Thomas P. Hoolihan, general partner of Hancock Harbor, executed the contract on behalf of the partnership. Prior to presenting the contract to Hoolihan, Bundschu, Hoffer and Hutchinson decided on a 30 percent, 40 percent 30 percent respective co- brokerage split on the $50,000 commission due on the sale of the Hancock Harbor Property. The co-brokerage fee split was typed on the bottom of the contract submitted to Hoolihan and was signed by the three brokers. The commission due to Hutchinson was made payable to L. E. Hutchinson Realty, Inc. On April 25, 1980, the contract with the original co-brokerage split was presented to Hoolihan who refused to agree to its co-brokerage split provision. In the presence of Hutchinson, Hoolihan informed Bundschu and Hoffer that he would not pay a commission to Hutchinson because he was a salaried employee of the Seago Group and not entitled to a commission on the sale of this property. Accordingly, the co-brokerage fee provision of the executed contract was never signed by the seller, Thomas P. Hoolihan. Instead, on April 25, 1980, Bundschu, Hoffer and Hoolihan agreed to a split of $20,000 to Hoffer and $15,000 to Bundschu in lieu of the split specified on the bottom of the contract. At the closing on July 18, 1980, which was held at Coastland Title Company, a closing statement was prepared which shows that real estate commissions were disbursed to Chuck Bundschu Realty, Inc. ($15,000), Marinatown Realty, Inc., ($15,000) and Hoffer's firm, Landco, Inc., ($20,000). The checks were written and disbursed following a conversation between an official of Coastland Title Company and Hoolihan in which Hoolihan informed the official that Hutchinson was a Seago employee and he would not agree to pay a $15,000 commission to him under such circumstances. On July 18, 1980, a check for $15,000 was issued by Coastland Title Company to Marinatown Realty, Inc. The $15,000 represented Hutchinson's share of the co-brokerage agreement. When received on July 18, 1980, by Billie Robinette, the broker for Marinatown Realty, the check was signed over by her to Seago Group, Inc., since in her opinion it did not represent commissions earned by Marinatown Realty. The oral agreement between Hutchinson and Hoolihan was to terminate at the end of April, 1980, or approximately five days after the Hoffer contract was presented. Hoolihan offered to renew the contract without a provision for a guaranteed salary because Marinatown Realty had been consistently losing money since its incorporation. On May 6, 1980, Hoolihan received a letter of resignation from Hutchinson and concluded that his offer had been rejected. In early May, 1980, Hoolihan received a call from Ms. Robinette, who had been employed as Hutchinson's secretary, regarding filling the open brokerage position at Marinatown Realty, Inc. Hoolihan discovered from Ms. Robinette that Hutchinson had paid himself 50 percent of the commissions due Marinatown Realty, Inc., for the management of condominium rentals. After examining the check stubs from Marinatown's bank account, Hoolihan took personal possession of all the books and records of the company and had the office locks changed. When he examined the books and records of the realty company, Hoolihan realized that his assumption that Hutchinson Realty, Inc., became inactive when Marinatown Realty, Inc. was formed in January, 1979, was erroneous and that Hutchinson had operated his own realty company, L. E. Hutchinson Realty, Inc., while employed by Marinatown Realty, Inc. Although he held multiple licenses, Hutchinson denied that a conflict ever existed between his duties to Marinatown Realty, Inc., and his own company, L. E. Hutchinson Realty, Inc. When questioned during the final hearing regarding how he decided where to list properties while he was the broker for both companies, the following exchange occurred between Hutchinson and counsel for Marinatown Realty, Inc.: Q Let me ask you, Mr. Hutchinson, how would it be decided when you were to go out and list property as to whether or not that property would be listed under Marinatown Realty or L. E. Hutchinson Realty, Inc.? Who would make that determination? A I would. Q Solely on your own? A I had no contract with anyone. I had nothing in writing to direct me where to place any business. Q So this would be solely your decision as to how you would list the property? Either Marinatown Realty or L. E. Hutchinson Realty? A If I secured the listing it was my dis- cretion as to where I listed the real estate. I had the choice of one of two companies. * * * Q If you were to list property in my hypo- thetical with Marinatown Realty, is it not a fact that they would receive, and being Marinatown Realty, would receive one half of the commission and you, as the broker, would receive the other half? A That was what I did. Q So it would certainly be beneficial to Seago to have you list as much property as you could with Marinatown Realty because they, in fact, owned the stock with Marinatown Realty, is that not true? A Yes, sir. Q When you would list property with L. E. Hutchinson Realty, Inc., would you do this with the full knowledge, consent and permission of Marinatown Realty, Inc.? A Yes, sir. Q How would you say that you gave full consent when you just testified that it was solely up to you as to how you would list property? A If I solely decided, I give my consent. I don't have anybody else to answer to. (T. pp. 108-110) During the period that Hutchinson was a broker for Marinatown Realty and L. E. Hutchinson Realty, Hutchinson believed his primary duty was toward his own company as illustrated by the following exchange between counsel for Respondent and the complainant: Q It's a fair statement to say that you, as a broker for Marinatown Realty, Inc. didn't make a whole lot of money for Marinatown Realty, did you? A I didn't run the P & L statement. Q I'm asking you as being the broker. You didn't make a lot of money for Marinatown Realty, Inc., did you? A I made as much money for them as I did for the responsibility. Q Well, did L. E. Hutchinson Realty, Inc. make a lot of money during that period of time? MR. FERNANDEZ: Objection as to relevancy, this whole line of questioning. MR. NEEL: Your Honor, it isn't. It's germaine. HEARING OFFICER: Objection overruled. THE WITNESS: I'm sorry, the question? Q Did L. E. Hutchinson Realty, Inc. make a lot of money during this period of time? A That's relative. Q In comparison to what money Marinatown Realty made? A Yes, sir, because L. E. Hutchinson Realty had a thirty thousand retainer that was coming in up until April 30th. Q From Seago? A Certainly. Q So L. E. Hutchinson Realty, Inc. made a lot more money than Marinatown Realty, Inc., didn't they? A That's the way its supposed to work. Q And, again, it was at your sole dis- cretion as to how you would list the properties; under which principal. A Yes, but I asked for a specific con- tract and never got it. (T. pp. 124-125) The Administrative Complaint in this case was filed on July 22, 1981. The preliminary investigative report compiled by Robert Corno, DPR Investigator, was filed on September 24, 1981 and the final investigative report was filed on September 30, 1981. The following is a synopsis of the investigator's findings and recommendation: That the COMPLAINANT [Hutchinson] worked for the SUBJECT [Hoolihan] and their contractual agreement was verbal. COMPLAINANT was paid on a salary/commission basis by companies of which SUBJECT is Chief Officer. That the COMPLAINANT filed civil action suit against SUBJECT in this case and it was dismissed with prejudice. That prior investigation by the DPR re- commended that no action be taken against the SUBJECT in this case. That two weeks after this investigation was undertaken, an Administrative Com- plaint was being filed by the DPR against the SUBJECT. That the existing BROKER for MARINATOWN REALTY, INC. was not involved in this case, and that since the time of the above referenced transaction, the SUBJECT has acquired his BROKER'S license #020462 which had no effect in this case. That conflicting statements by inter- viewers, namely former and present em- ployees and other agents involved in this case revealed that there is a reasonable doubt for probable cause against the SUBJECT. (Respondent's Exhibit 1) As noted by Investigator Corno, this was the second time Marinatown Realty had been investigated in relation to this case. In both instances a recommendation that no action be taken against the Respondent was apparently made. At the final hearing on December 1, 1981, counsel for the Department saw the complete investigative report, including the investigator's recommendation of a lack of probable cause, for the first time. Count II of the Administrative Complaint alleges that Hutchinson is entitled to compensation for services rendered on the following sales contracts: Seago Group, Inc. as seller, to Michael T. and Judith Marchiando as buyers, Seago Group, Inc. as seller, to John E. and Charlotte A. Ferguson as buyers, and Seago Group, Inc. as sellers, to Kenneth J. Dawson as buyer. In regard to the first transaction, the Marchiandos were personal friends of the son-in-law of Seago's major shareholder, Mr. R. Berti. Hutchinson's role in this transaction was limited to preparing the contract and mailing it to the Marchiandos for signature. Hutchinson had no part in selling this property and never met the Marchiandos. The sale of the Ferguson's arose in a manner similar to the Marchiandos. Mr. Ferguson is the manager of a Detroit company owned by Mr. Berti. Similarly, Mr. Dawson works for Mr. Berti in Detroit as an accountant. These sales were made by Mr. Berti and Hutchinson furnished administrative assistance by completing the contracts and sending them to these individuals for signature. Under the terms of the agreement between Hoolihan and Hutchinson, a commission was not due on these properties to Hutchinson since these were not outside listings and his agreement with Hoolihan did not contemplate that commissions be paid in such situations.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Administrative Complaint filed against Marinatown Realty, Inc. be dismissed. DONE and ORDERED this 28th day of April, 1982, in Tallahassee, Florida. SHARYN L. SMITH Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of April, 1982. COPIES FURNISHED: Xavier J. Fernandez, Esquire NUCKOLLS JOHNSON & FERNANDEZ Suite 10, 2710 Cleveland Avenue Fort Myers, Florida 33901 James A. Neel, Esquire 3440 Marinatown Lane, N.W. Fort Myers, Florida 33903 Frederick H. Wilsen, Esquire Assistant General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Samuel R. Shorstein, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Carlos B. Stafford Executive Director Florida Real Estate Commission 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802
