The Issue Whether or not the Respondent, Michael H. Cohen, based on conduct set forth hereinafter in detail, is guilty of fraud, misrepresentation, false promises and breach of trust in a business transaction in the State of Florida, in violation of subsection 475.25(1)(b), Florida Statutes (1979). Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received, the transcript of the proceedings, and the entire record compiled herein, I hereby make the following relevant:
Findings Of Fact By its Administrative Complaint filed herein signed September 29, 1981, the Petitioner, Florida Real Estate Commission (herein called the "Commission" or "Petitioner") seeks to suspend, revoke, or take other disciplinary action against the Respondent as licensee, and against his license as a real estate broker under the laws of the State of Florida. Respondent is a licensed real estate broker who has been issued license No. 0209033. On February 17, 1978, Michael Rappaport sold ten townhouse units in Collonade Condominiums, 2275 N.E. 122nd Street, North Miami, FLORIDA, to the Respondent. The Respondent purchased the townhouses, by deed, in the name of his mother-in-law, Luz Sanabria. At the time of this conveyance, Michael Rappaport owed $2,400 in condominium assessments to the Collonade Condominium Association and, at that time, foreclosure proceedings by the mortgagee, Dade Federal Savings and Loan Association, were pending for failure to pay the mortgages (by Rappaport). Respondent, as agent for Ms. Sanabria, contacted the condominium association and made promises to pay the past due assessments. As stated, following transfer of the title to the Respondent, there remained owing to the condominium association past due assessments by the Respondent. The Respondent negotiated a settlement with the condominium association for payment of the delinquent assessments; however, the Respondent defaulted on the terms of the settlement for payment of the delinquent assessments. On September 25, 1979, Collonade Condominium Association obtained a judgment against Respondent for $7,094.40 which remained unsatisfied at the time of the hearing herein. It is based upon the above-referred to facts that the Petitioner contends that Respondent is guilty of fraud, misrepresentation, false promises and breach of trust in a business transaction in the State of Florida in violation of subsection 475.25(1)(b), Florida Statutes (1979). Respondent takes the position that (1) he was not the real party in interest inasmuch as he was attempting to execute a favorable transaction on behalf of his mother-in-law, and (2) that he attempted to strike deals, negotiate settlements and that to do otherwise, either in his capacity as a real estate agent or as a son-in-law, he would be remiss. To support his position, Respondent points to the fact that he retained a knowledgeable mortgage broker to remove these properties from foreclosure proceedings and to attempt to renegotiate, restructure or otherwise put these mortgages, which were in foreclosure, back into current status. Additionally, Respondent avers that there is nothing improper respecting his attempt to negotiate a settlement with the condominium association, which was an everyday common practice. Respondent admits that he personally agreed to repay the condominium association, which agreement was defaulted and resulted in a judgment being entered against him. However, Respondent's position is that these were matters of a personal nature and were in no manner conduct amounting to fraud, misrepresentation, concealment and false promises, false pretenses, dishonest dealing by trick, scheme, or device or any other acts of conduct which subject him to disciplinary action pursuant to Section 475.25, Florida Statutes, Subsection 1(b) thereof.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Administrative Complaint filed herein be DISMISSED. RECOMMENDED this 22nd day of December, 1982, in Tallahassee, Florida. JAMES E. BRADWELL, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 22nd day of December, 1982. COPIES FURNISHED: Theodore J. Silver, Esquire 9445 Bird Road Miami Florida 33165 Walter F. McQuade, Esquire 700 Northeast 125th Street North Miami, Florida 33161 William Furlow, Esquire Department of Professional Regulation - Legal Section P.O. Box 1900 Orlando, Florida 32802 Mr. C. B. Stafford Executive Director Florida Real Estate Commission P.O. Box 1900 Orlando, Florida 32802 Fred Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
Findings Of Fact The Respondent, Terry G. Jewell, (Jewell) is now and was at all times material to this case a licensed real estate broker-salesman in the State of Florida, having been issued license number 0131811 in accordance with Chapter 475, Florida Statutes. He has held this license since 1974, even though he has worked in the real estate business only off and on since that time. In November, 1984, Jewell started Sun Country Homes of North Florida, Inc., with E. M. Coullias and another investor. Jewell owned 32 1/2 shares of the corporation and was an employee of the corporation. Coullias was president and chief operating officer of the corporation. Jewell's duties included managing sales, advertising, development of sales materials, preparation of house plans and procurement of mortgage financing for customers. Coullias was in charge of field supervision of construction of the homes, keeping the books and records of the corporation, and paying all accounts. The corporation had another employee, Joan Mead, who acted as a secretary and sales person. On March 25, 1986, Anne and Frank Koblinski entered into a contract with Sun Country Homes of North Florida, Inc., to have a house built. After the execution of that contract, an account was opened at the Gainesville State Bank in Gainesville, Florida, jointly between Jewell, representing the corporation, and Willern Koblinski, representing his parents. The Koblinskis deposited $48,000 into that account. At the time the contract with Sun Country Homes of North Florida, Inc., was executed by the Koblinskis, they were living in the Fort Myers area, so they designated their son, Willern Koblinski, as the person authorized to disburse funds from the joint account on their behalf. Willern Koblinski lived across the street from the property where the home was to be built. He regularly inspected the building site and determined whether Sun Country was entitled to a draw in accordance with the draw schedule contained in the contract. Generally, Joan Mead, the secretary for Sun Country, would call Willern Koblinski on his pager to request a draw. After he inspected the property, Willern Koblinski would draw a check on the joint account and drop it off at the corporation's office. During the course of construction, the following draws were made from the account and were disbursed by checks made payable to Sun Country Homes of North Florida, Inc., and were signed by both Jewell and Willern Koblinski: Date Amount 5/8/86 (1st draw) $ 9,570.00 5/21/86 (partial 2nd draw) $16,000.00 The following draws were made from the account payable to Sun Country Homes of North Florida, Inc., but were never signed by Jewell: Date Amount 6/10/86 (balance 2nd draw) $ 3,140.00 6/25/86 (partial 3rd draw) $ 3,000.00 7/11/86 (balance 3rd draw) $ 6,570.00 7/30/86 (partial last draw) $ 5,000.00 The total draws were $43,280. Each draw was deposited in the general operating account of Sun Country Homes of North Florida, Inc. On July 19, 1986, Jewell took a vacation and was out of town until July 30, 1986. When he returned, he discovered that some of the homes under construction were behind schedule. Jewell also discovered that several subcontractors and suppliers had not been paid. Jewell left messages for the president of Sun Country Homes, E. M. Coullias, and attempted to contact Coullias to discuss the problems with the construction schedules on several homes and the subcontractors who had not been paid. Jewell and Coullias had a large confrontation regarding the homes that were behind schedule and the non-payment of subcontractors Shortly after that confrontation, Jewell resigned as an officer and employee of Sun Country Homes of North Florida, Inc. Even after his resignation, Jewell personally went to the job site of the homes being construction for Waters, Ross, and Koblinski, and completed these homes so that the buyers could occupy them. At the time of Jewell's resignation from Sun Country Homes of North Florida, Inc., there was $5,332.00 remaining in the joint account for the Koblinskis' house. As soon as Jewell realized that Coullias had spent the funds previously paid to Sun Country Homes of North Florida, Inc., and could not pay the subcontractors, Jewell advised Mrs. Koblinski and Willern Koblinski to withdraw the remaining funds from the joint account and to use those funds to pay any subcontractors or suppliers who had not been paid. Jewell signed a blank check in order to permit Willern Koblinski to withdraw those funds. During the time that Jewell worked for Sun Country Homes of North Florida, Inc., the corporation sold and constructed approximately 25 homes. Before the situation arose on the Koblinski contract, Jewell knew of no other incidents where Sun Country Homes failed to pay subcontractors or suppliers. During the entire time that Jewell worked for Sun Country Homes of North Florida, Inc., Coullias was President of the corporation and controlled and managed the collection and deposit of receipts of the company and disbursement of these funds. Jewell first learned of unpaid subcontractors and suppliers after he returned from vacation on July 30, 1986. After his resignation from Sun Country Homes, Jewell attempted to help the Koblinskis in completing their house. He came to their house and finished a "punch list." Jewell received no payment from Sun Country Homes for any of these efforts. The Koblinskis used part of the funds disbursed to them to pay the air conditioning and plumbing subcontractors. They have about $1,062 left from these funds. After subcontractors and suppliers were not paid, Coullias told Willern Koblinski that they would be paid. He also told Jewell to have no further contact with the Koblinskis. However, Sun Country Homes of North Florida, Inc., closed its doors without paying the subcontractors and suppliers. Apparently Coullias has left the area and cannot be located. There are at least four subcontractors who worked on the Koblinski house who have not been paid: Sun Coast Insulation $1,191.00 Landmark Truss $1,322.39 Dyson Cabinet Millwork $4,029.79 Myers Brothers Septic Tank $ 785.00 Dyson and Myers have filed liens against the Koblinski home for the amount of their respective bills. Jewell did not receive any funds disbursed to Sun Country Homes for the Koblinski house. The only funds he received from the corporation were salary and reimbursement for expenses. He did not receive any bonuses or cash loans. If the funds paid to Sun Country Homes of North Florida, Inc., for the Koblinski draws were not used to pay the bills on the Koblinski construction, Jewell did not receive any benefit in any way from those funds.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that: The Florida Real Estate Commission enter a final order dismissing the Administrative Complaint filed against Terry G. Jewell. DONE and ENTERED this 25th day of September, 1987, in Tallahassee, Florida. DIANE K. KIESLING, Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 25th day of September, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-2192 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the proposed findings of fact submitted by the parties in this case. Specific Rulings on Proposed Findings of Fact Submitted by Respondent, Terry G. Jewell Respondent's proposed findings of fact 1 - 30 are adopted in substance as modified in Findings of Fact 1 - 28. COPIES FURNISHED: Arthur Shell, Jr., Esquire Department of Professional Regulation Division of Real Estate 400 West Robinson Street Orlando, Florida 32801 William C. Andrews, Esquire Post Office Drawer C Gainesville, Florida 32602 Harold Huff, Executive Director Department of Professional Regulation Division of Real Estate 400 West Robinson Street Orlando, Florida 32801 Joseph A. Sole, General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Tom Gallagher, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750
Findings Of Fact At all times relevant hereto, Virginia King was registered with the Florida Real Estate Commission as a real estate salesperson. She has been so licensed for at least 15 years working for Tam Bay Realty. Respondent manages the residential unit here involved for the owners to whom she has sold several properties in past years and who have been out of the country for an extended period. In renting the property the rent is paid to Respondent, deposited into her account from which various expenses associated with the rental of the property is paid, and she makes an accounting to the owners for all monies owed to them. The dwelling in question was listed with Tam Bay Realty for sale with Respondent as listing agent, but she was also renting the property on behalf of the owner. To the Tam Bay For Sale sign on the property, Respondent attached a For Rent sign. Richard D. and Linda Grey were looking for a rental and saw the For Rent sign on the property and called Tam Bay Realty where they were put in touch with Respondent who subsequently met the Greys at the residence. The Greys liked the property and gave Respondent a check for $100 as a deposit on the lease to be executed when the Grey's presented their first month's rent. The residence needed some cleaning which Respondent agreed to have done if the Grey's would have the water turned on. Grey also wanted some trimming of hedges to which Respondent agreed. The Greys later met Respondent at the dwelling before the cleaning and trimming had been done. Grey contends that he did not have the water turned on because "that was the owner's responsibility," but the water was turned on and Respondent had the dwelling cleaned and the hedges trimmed for which she paid in excess of $100. Before the time for occupancy arrived, the Greys encountered a delay in the closing on the home they were selling and called Respondent to say they no longer wanted to rent the house and demanded a return of their $100 deposit. Respondent, contending that Grey breached the agreement to rent the property, credited the $100 to the account of the owner (whose account was also charged for the cleaning and trimming), and refused to remit the deposit to Grey.
Findings Of Fact Based upon the pleadings and responses thereto, an Order imposing sanctions for Respondent's failure to submit discovery as required by the undersigned dated October 15, 1986 and the entire record compiled herein, I hereby make the following relevant factual findings. Respondent is the developer of a condominium known as La Residence. As Presently developed, La Residence consists of sixty units. La Residence is located in Boca Raton, Florida. Respondent failed to meet the completion date for the subsequent phases of La Residence as is described in the declaration of condominium of La Residence. According to the Declaration of Condominiums for La Residence, the scheduled dates listed for construction of the subsequent phases of La Residence were June, 1982 for phase II; February, 1983 for phase III, and November, 1983 for phase IV. Amendments to the Declaration of Condominium of La Residence were recorded on June 30, 1981, March 22, 1982 and August 2, 1984. Respondent did not furnish the Division with copies of the above-referred amendments. Additionally, Respondent failed to provide purchasers of units within La Residence, copies of the above-referred amendments. Respondent failed to hold annual members meeting for the years 1981, 1982, 1983 and 1984. Respondent failed to call a members meeting to allow non-developer unit owners to elect a director after fifteen percent of the available units had been conveyed. Respondent failed to mail to unit owners, copies of the proposed annual budget for the years 1982, 1983, and 1984. Respondent failed to include the statutory reserves and the proposed annual budget as required for the years 1982, 1983 and 1984. Respondent failed to fund reserve accounts for the years 1982, 1983 and 1984. Respondent failed to provide unit owners with financial reports for fiscal years 1982, 1983 and 1984. Respondent failed to pay the developer's share of assessments due to be paid by the developer after June 30, 1982. The Declaration of Condominium for La Residence was recorded in the public records of Palm Beach County in 1981. Control of the Condominium Association was turned over to non-developer unit owners on February 16, 1985. No "turnover report" was prepared by a certified public accountant nor was such a report ever furnished to the Condominium Association by Respondent. Respondent has not provided the Condominium Association copies of all canceled checks and bank statements for the time period dating from the recordation in 1981 to January 31 1984. Respondent, or a representative on its behalf, did not appear at the hearing to refute or otherwise contest the alleged violations set forth in the Notice to Show Cause filed herein.
Recommendation Based on the foregoing Findings of Fact and Conclusions, of a Law, it is hereby RECOMMENDED Respondent pay to the Division, within thirty (30) days of issuance of the Division's Final Order, a civil penalty in the amount of ten thousand dollars ($10,000). Respondent secure the services of an independent certified public accountant who shall review the condominium records and submit a turnover review in accordance with the provisions of Section 718.301(4)(c), Florida Statutes (1985) and rule 7B-23.03(4)(5) and (6), Florida Administrative Code. Within thirty days of the Division's Final Order, it is recommended that the Division issue guidelines to Respondent to ensure that the condominium records are reviewed in accordance with the above-referenced statutory and rule provisions. Provided that monies are found to be due and owing the association based on the review, Respondent shall be directed to remit such amounts to La Residence of Boca Del Mar Condominium Association. Recommended this 23rd day of March, 1987, in Tallahassee, Florida. JAMES E. BRADWELL, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of March, 1987.
Findings Of Fact At all times pertinent to these Findings of Fact, the Respondent has been a licensed real estate broker in the State of Florida having been issued license number 0317497. In 1985, the Respondent operated his own real estate brokerage firm, Kline Real Estate, Inc., which acted as a marketing agent for Majestic Builders, a construction company. Both Kline Real Estate, Inc., and Majestic Builders did business in and around the Spring Hill, Hernando County, Florida, area. Majestic Builders was owned by George Orlando. In early 1985, Majestic Builders' qualifying general contractor was Stephen Cannon. In early 1985, the Respondent was contacted by the Whitmarshes of Lynchburg, Virginia, who expressed interest in having a modified version of a Majestic Builders model home built on a piece of property in Spring Hill, Florida. Eventually, the Whitmarshes selected a lot on which to have the residence built, and the Respondent brokered the purchase of the lot (from a third party) and the construction contract. Both contracts were entered into on or about April 27, 1985. Both contracts required that the Whitmarshes make a deposit, $1,000 on the lot purchase and $5,000 on the construction contract. Both deposits were made into the escrow account maintained by Kline Real Estate, Inc. The $1,000 deposit was disbursed without incident at the closing of the lot purchase on or about May 7, 1985. The construction contract between the Whitmarshes and Majestic Builders provided in connection with the deposit: DEPOSIT TO FIX HOME PRICE FOR PERIOD OF 6 MOS. [MONTHS), DURING WHICH COMMENCEMENT MAY BEGIN WITHIN 30 DAYS OF NOTIFICATION AND INITIAL PAYMENT OF 30% OF BALANCE. SHOULD COMMENCEMENT BE AFTER 6 MOS., DEPOSIT WILL STILL APPLY BUT TO NEW PURCHASE PRICE OF MODEL AT TIME OF CONSTRUCTION. For the balance of the spring and summer of 1985, the Whitmarshes continued to consult with the Respondent and, primarily through the Respondent, with George Orlando regarding the modifications the Whitmarshes desired to make to the Majestic Builders model, but they were not particularly anxious to commence construction for personal, family health reasons. In addition, they understood and knew from the contract provision and from conversation with the Respondent that their $5,000 deposit was supposed to be credited to the price of the home they eventually built even if commencement was more than six months from the contract date. On or about November 11, 1985, the Respondent advised the Whitmarshes by telephone, confirmed in writing: This [is] notification, that in accordance with your contract, you are legally in default. This letter is written out of legal necessity and has no bearing on your deposit which will bw [sic] applied to the agreed upon purchase price of a Majestic Home. The default merely is to state the builder is no longer held to the prices quoted. And any changes either up or down will be reflected in the new contract price. (Emphasis added.) Notwithstanding his November 11 letter, the Respondent withdrew the Whitmarshes' $5,000 deposit from the Kline Real Estate, Inc., escrow account and deposited it in the Kline Real Estate, Inc. operating account. Of the $5,000, $1,000 was used the purchase of a building lot for Majestic Builders, and $1,500 was paid directly to George Orlando, to whom the Respondent believed the $5,000 belonged. 1/ The Respondent is unable to account for the balance of the $5,000. 2/ On or about March 21, 1986, the Respondent received a letter from Mr. Whitmarsh stating: "With this letter I authorize you to use $500 from my escrow account to obtain a new floor plan and prepare a cost estimate for my revised version of your Wind and Wildfire Model Home." The Respondent, who had had a heart attack in September, 1985, and was in the process of closing out Kline Real Estate, Inc., and getting out of the real estate business, passed the letter on to George Orlando. Orlando balked at the request, taking the position that the purpose of the $5,000 was not for use to draw up revised plans. But it is the Respondent's understanding that Orlando eventually relented and agreed not to require the Whitmarshes to pay for the revised plans with new money. It is unclear from the evidence whether revised plans ever were drawn. 3/ In approximately June or July, 1986, the Respondent closed Kline Real Estate, Inc., and got out of the real estate business. He never heard anything else from the Whitmarshes about the transaction and assumed that Orlando and the Whitmarshes had satisfactorily concluded their business dealings. But in fact in approximately early 1987, the Whitmarshes received information that Majestic Builders was not a licensed contractor. Although, on checking, they learned that Majestic Builders then had a licensed qualifying contractor, the Whitmarshes still did not feel comfortable with Orlando and Majestic Builders. In about April, 1987, the Whitmarshes decided to hire another builder and asked Orlando for the return of their deposit. Orlando refused, saying that the Respondent had the money. 4/ Nonetheless, the Whitmarshes never contacted the Respondent for the return of the deposit. Later, the Whitmarshes and Orlando became involved in another dispute arising out of the alleged improper use of Orlando's Wind and Wildfire drawings by the Whitmarshes and the builder they eventually hired, Stephen Cannon, who had been Majestic Builders' qualifying general contractor but had left to start his own construction company with the understanding that Cannon would not use any of Majestic Builders' drawings. The Respondent had no knowledge of any of these disputes between Orlando and the Whitmarshes until he was interviewed by a Department of Professional Regulation (DPR) investigator in August, 1988. The DPR had begun an investigation of Orlando on the Whitmarshes' complaint of alleged violations of the laws regulating construction contractors and learned that the dispute involved a deposit that had been held in trust by a licensed real estate broker. DPR then began an investigation of the Respondent.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Florida Real Estate Commission enter a final order finding the Respondent, Ronold E. Kline, guilty of violating portions of paragraph (b) and paragraphs (d) and (k) of Sections 475.25(1), Florida Statutes (1987), and suspending his license for a period of one year. RECOMMENDED this 15th day of December, 1989, in Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 15th day of December, 1989.
Findings Of Fact Respondent Santaniello holds real estate broker license number 0186475, and was so licensed at all times relevant to this proceeding. Santaniello is the active broker for Respondent, Sunair Realty Corporation, which holds license number 0213030. Mr. Don M. and Mrs. Agnes C. Long own two lots in Port Charlotte which they purchased as investments. By letter dated June 8, 1981, Respondents forwarded a "Deposit Receipt and Contract for Sale and Purchase" on each of these lots to the Longs. The documents established that Anni Czapliski was the buyer at a purchase price of $1200 per lot. Respondent Sunair Realty Corporation was to receive the greater of $120 or ten percent of the felling price for "professional services." The letter and documents were signed by Respondent Santaniello. Anni Czapliski was Bernard Santaniello's mother-in-law at the time of the proposed sale. This relationship was not disclosed by Respondents and was not known to the Longs at the time they were invited to contract with Respondents for sale of the lots. The Longs rejected the proposed arrangement for reasons not-relevant here.
Recommendation From the foregoing findings of fact and conclusions of law it is RECOMMENDED that Petitioner enter a Final Order finding Respondents guilty of violating Subsection 475.25(1)(b), Florida Statutes (1979), and fining each $500. DONE and ENTERED this 16th day of April, 1982, in Tallahassee, Florida. COPIES FURNISHED: Salvatore A. Carpino, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Robert J. Norton, Esquire Suite 408 First National Bank Building Punta Gorda, Florida 33950 Mr. C.B. Stafford Executive Director Board of Real Estate Post Office Box 1900 Orlando, Florida 32801 Frederick Wilsen, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 R.T. CARPENTER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 16th day of April.
The Issue The Florida Real Estate Commission, herein sometimes called the Plaintiff or the Commission, seeks to revoke or suspend the license of the Defendant, Alan Leavitt, a registered broker, based on allegations that he violated Subsections 475.25(1)(a) and (b), Florida Statutes, as alleged in its administrative complaint filed on December 9, 1976. As is set forth more particularly in its two count administrative complaint, the Commission alleges that the Defendant, while employed as an active broker for Special Realty Corp., acted in his own behalf by advertising and selling several unimproved lots located in Walton County, Florida. It is further alleged that the Defendant made statements in an effort to sell said lots indicating that the lot sizes were 50 feet wide and 150 feet deep, whereas in actuality the lots were only 25 feet wide and 105 feet deep. The complaint alleges that the purchaser consummated the sale for the above referred lots based on the representations made respecting the lot sizes and upon subsequent examination found that the lot sizes were substantially less whereupon the purchaser demanded a refund from Defendant, to no avail. Based thereon, it is alleged that the Defendant is guilty of fraud, misrepresentation, concealment, false promises, false pretenses, etc., in a business transaction in violation of Subsection 475.25(1)(a), Florida Statutes. In count two it is alleged that the Defendant, while registered as an active real estate broker, permitted Isaac Shelomith and Barry Shelomith, registered real estate salesmen, to unlawfully operate as real estate salesmen out of his offices and encouraged them to engage in the sale of lots in Walton County, Florida by means of unscrupulous and unlawful methods involving fraud, and other breaches of trust in violation of Subsection 475.25(1)(a), and (b), Florida Statutes. For all of the foregoing reasons, the complaint alleges that the Defendant is guilty of a course of conduct or practices which show that he is so dishonest and untruthful that the money, property, transactions and rights of investors or those with whom he may sustain a confidential relation, may not safely be entrusted to him, in violation of Subsection 475.25(3), Florida Statutes.
Findings Of Fact Based upon my observation of the witnesses and their demeanor, the pleadings and the admissions contained therein including the arguments of counsel, I make the following: The Defendant, who holds license number 0051095, was a registered real estate broker during times material to the allegations contained in the administrative complaint filed herein. During early October, 1975, Defendant placed in the classified section of the Miami Southside Newspaper, an ad relative to real property located in Walton County, near DeFuniak Springs. On October 14, 1975, Mr. Lionel G. Rush, an unemployed marketing executive, responded to the aforesaid ad to inquire about the advertised lots. He later purchased four lots from the Defendant for the sum of $1,500. The four lots were described in a warranty deed dated October 17, 1975, from Defendant to Lionel G. Rush and Susie M. Rush, his wife. (See Commission's Exhibit #4). Mr. Rush stated that the Defendant advised him that each individual lot was 50 feet in width and 150 feet in depth and it was based on these representations that he purchased the four lots described in the above referenced warranty deed. Mr. Rush, after purchasing the lots, investigated the lot sizes, approximately three weeks later by calling the county clerk for Walton County who advised that the lot sizes were approximately 25 by 105 feet each. He thereafter contacted the Defendant who checked to determine the accuracy of the lot sizes and was able to determine that the lot sizes were 25 by 105 feet as Mr. Rush had informed. Mr. Rush indicated that but for the inaccurate lot sizes, he was pleased with the property purchased from the Defendant. Mr. Rush testified that he advised the Defendant that there were in his opinion, several options available to satisfy or otherwise cure his purchase problems. He first suggested that the Defendant refund a portion of his purchase money to reflect the actual lot sizes conveyed or alternatively Defendant deed over to him another four lots to compensate for the alleged inadequacy of the lot sizes. Alan Leavitt, the Defendant herein, acknowledged that he sold four lots to Mr. Lionel Rush and his wife in Country Club Heights in Ft. Walton Beach. He denied that the lot sizes were recorded by him or upon his direction as the description is now reflected on the warranty deed entered herein. (See Exhibit 4). Defendant testified that after selling the lots to the Rushes, he received a phone call approximately three weeks later from Mr. Rush complaining about the lot sizes. Mr. Rush expressed his desire to get a refund of the purchase money paid or to seek some other restitution. Defendant checked into the matter and was able to determine that the lot sizes were in fact 105 feet by 100 feet. When Defendant was unable to resolve the matter with the Rushes, he offered to return their money back and in fact purchased a money order for the full amount of the purchase price and agreed to absorb all incidental costs connected with the purchase of the property. He stated that the refund offer was made after Mr. Rush tried to bargain over price and in his opinion was trying to get the lots for what was in his opinion, a "ridiculously low price." He testified that when he discerned this, he had no further dealings with Mr. Rush and was only interested in refunding the purchase money price once the Rushes executed a proper deed returning the property to him. He (Defendant) denied ever misrepresenting the lot sizes. Isaac Shelomith, a registered real estate salesman during times material, was called and denied having any employment relationship with the Defendant in any manner during times material to the allegations contained in the administrative complaint filed herein.
Recommendation Based on the foregoing findings of fact and conclusions of law, I hereby recommend that the administrative complaint filed herein be dismissed in its entirety. DONE AND ENTERED this 1st day of June, 1977, in Tallahassee, Florida. JAMES E. BRADWELL, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: David B. Javits, Esquire 3628 Northeast Second Avenue Miami, Florida 33137 Alan Leavitt 7100 Fairway Drive Miami Lakes, Florida 33014 Bruce I Kamelhair, Esquire Associate Counsel Florida Real Estate Commission 2699 Lee Road Winter Park, Florida 32789
The Issue At issue herein is whether respondents' real estate licenses should be disciplined for-the alleged violations set forth in the administrative complaint. Based upon all of the evidence, the following facts are determined:
Findings Of Fact At all times relevant hereto, respondent, Juan Rios, was a licensed real estate broker having been issued license number 0155126 by petitioner, Department of Professional Regulation, Division of Real Estate. Respondent, Victoria R. Rios, is a licensed real estate broker-salesman having been issued license number 0331183 by petitioner. The Rios are husband and wife and presently reside at 855 80th Street, #1, Miami Beach, Florida. On December 13, 1982, Juan Rios obtained a six-month multiple listing agreement to sell a house located in Hacienda Estates at 11451 S.W. 33rd Lane, Miami, Florida. The agreement was executed by Rios "As Realtor" and by the property owner, Mercedes Garcia. At Mercedes' request, the Rios placed an initial sales price of $145,000 on the home. On December 15, a similar agreement was executed by Rios and Garcia on condominium unit 9B, Laguna Club Condominium, 10710 N. W. 7th Street, Miami, Florida. That property was also owned by Garcia. Although the agreement introduced into evidence does not contain Rios' signature, at final hearing Juan Rios acknowledged that he had executed such an agreement. The listing agreements provided that if the properties were leased during the term of the agreements, the listing realtor would receive a brokerage fee of 10% for such leasing. The agreement also provided that the realtors were not responsible for vandalism, theft or damage of any nature to the property. Garcia is a native and resident of Venezuela, where she owns a radio station. The two properties in question were previously owned by her father. When the father died, apparently sometime in 1982, Mercedes inherited the house and condominium. The Rios were friends of the father, and agreed to list and manage the properties as a favor to the deceased. Mercedes left the country after the agreements were signed, and has apparently not returned. Although she is the complainant who initiated this matter, she did not appear at final hearing. The house at 11451 S. W. 33rd Lane had been vandalized prior to the listing agreement being signed. According to documents introduced into evidence, the property has also been the subject of subsequent vandalisms, the nature and extent of which are unknown. A tenant was eventually procured by Mercedes' aunt in February, 1983 at a monthly rate of $800. The tenant, a Mrs. Ramirez, paid some $4,800 in rents and deposits before she was killed at the home in June, 1983. The Rios spent some $2,644.36 of the $4,800 on repairs to the vandalism and for general maintenance. They also retained a 10% commission for their services, or $480. That left $1,675.64 owed to Mercedes. No lease was apparently ever signed by Ramirez, or at least none was given to the Rios by the relative who procured the tenant. The home was eventually sold to Mercedes' aunt for $85,000.1 None of the rental monies were placed in the Rios' trust account. The condominium unit was rented in June, 1983. The tenant, Oscar Ruiz, had answered an advertisement run by the Rios in a local newspaper. Although Ruiz executed a lease to rent the unit at a monthly rate of $500, the Rios did not have a copy of same, and claimed none was kept in their records. According to the Rios, Ruiz continued to rent the unit through April, 1984, or for eleven months. Total monies collected by the Rios from Ruiz, including a $500 security deposit, were $6,000, of which $3,364.86 was spent for maintenance, utilities, two mortgage payments, and a $500 payment to the owner (Mercedes). An additional $40.33 was spent on a plumbing bill, and $600 was retained as a commission by the Rios. This left $2,724.53 owed to Mercedes. None of the rental monies were placed in the Rios' trust account. In the spring of 1984, Mercedes retained the services of an attorney in Miami to seek her monies due from the Rios. Up to then, she had received no income or accounting on the two properties. The attorney wrote the Rios on several occasions beginning in April 1984, asking for a copy of the lease on the condominium unit, the security deposit, an accounting of the funds, and all other documents relating to the two, properties. He received his first reply from the Rios on May 3, 1984 who advised him that they had attempted to reach Mercedes by telephone on numerous occasions but that she would never return their calls. They explained that rental proceeds had been used to repair vandalism damage and structural defects. When the attorney did not receive the satisfaction that he desired, he filed a civil action against the Rios on October 10, 1984. On October 26, 1984 the Rios sent Mercedes a letter containing an accounting on the two properties reflecting that she was owed $4,400.17 by the Rios. To pay this, they sent a $140 "official check," and a promissory note for the balance to be paid off in 40 monthly installments at 10% interest. They explained that their real estate business had closed, and due to financial problems, they were unable to pay off the monies due any sooner. They also asked that she instruct her attorney to drop the suit. Mercedes rejected this offer and has continued to pursue the civil action. It is still pending in Dade County Circuit Court. At final hearing, the Rios characterized their involvement with Mercedes as a "professional mistake," and one undertaken out of friendship for Mercedes' father. They acknowledged they did not use a trust account on the transactions and that they had used the $4,400 in rental money due Mercedes for their own use. They considered the excess rent proceeds to be compensation for other "services" performed by them on behalf of Mercedes. However, there is no evidence of any such agreement between the parties reflecting that understanding.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is Recommended that Juan and Victoria Rios be found guilty as charged in Counts II and III, and be found guilty of culpable negligence and breach of trust in Count I. It is further recommended that Juan Rios' license be suspended for one year and that Victoria Rios' license be suspended for three months. DONE and ORDERED this 20th day of January, 1986, in Tallahassee, Florida. DONALD R. ALEXANDER, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of January, 1986
Findings Of Fact The facts in this case were generally undisputed. Respondent is a registered real estate broker and was so acting at all times relevant to the complaint filed herein. Respondent and her husband, George L. Mann, are resident managers of an apartment complex known as Ocean Beach Club at Flagler Beach, Florida. Many of these units are owned by individuals and are rented. Sheldon Carlson owned one of these rented apartments which he had listed with Respondent to sell. Sawyer Young, a businessman from Virginia, was interested in purchasing an apartment in this complex as an investment and after Respondent had showed him two unfurnished units expressed a desire to see a furnished apartment. Respondent showed him the apartment owned by Carlson. Young came back the following morning and asked to see this apartment again after which he submitted an offer to purchase the apartment. This offer was similar to the Contract for Sale and Purchase as shown on Exhibits 1 and 3 with one major exception, viz. that "small appliances, pots, pans, dishes, & etc., and sweeper" had not been deleted. This contract dated January 28, 1976 provided for a deposit of $300 and a purchase price of $30,500. At the time the offer was made Respondent was aware that the seller did not desire to sell the small appliances and kitchen articles, however, this was the offer that was made by the buyer. The contract further provided that if the contract was not accepted by the seller prior to 6:00 P.M. on January 29, 1976 the offer was null and void and the deposit would be returned to the buyer. Upon making the offer the buyer departed for Virginia. Respondent contacted seller, who lived in Mount Dora, by telephone and communicated the offer to him. Carlson told Respondent that he would not include the small appliances, etc. at the offering price and asked her to delete those items from the contract. He confirmed this qualified acceptance of the offer in a mailgram dated 9:19 A.M., January 29, 1976. Upon receipt of this information from seller Respondent deleted those items from the contract that had already been executed by the buyer. When the Respondent contacted the buyer a day or so later in Virginia by telephone and communicated the counter offer of the seller to him he gave every indication that he would accept the changes made by the seller. During the ensuing month Respondent was in communication with the buyer several times to arrange for a closing date. The original closing date was changed by the buyer and shortly before the next scheduled closing date the buyer informed Respondent that he would not go through with the sale and demanded return of his deposit. Respondent advised the buyer that the attorney had performed certain work and the buyer authorized her to pay the attorney the $75 for legal services he had performed. One month later Respondent split the $225 remaining of the deposit between herself and the seller upon the assumption that the buyer had breached the contract. Thereafter a complaint was made to the Real Estate Commission and the investigation and the complaint filed herein followed.
