Findings Of Fact At all times material to these proceedings, the Respondent McVety was a licensed real estate broker in Florida, having been issued license numbers 0461636 and 0258678. On January 1, 1989, the Respondent purchased the company Realty Services of Southwest Florida, Inc., a Florida corporation. One of the services provided by the corporation was property management. Rents and security deposits were collected from tenants of residential leases on behalf of property owners. In some cases, Respondent McVety was acting as an agent on behalf of property owners through the corporation. In other cases, Respondent McVety or the corporation was the actual property owner. When Respondent McVety took over the management of the corporation after his stock purchase, he noticed that the escrow account into which security deposits were placed, was a non-interest bearing account. On January 23, 1989, the escrow account was changed by the Respondent from an non-interest bearing escrow account to an interest bearing account. The tenants were not notified that their security deposits were now bearing interest. On March 17, 1989, a routine audit was conducted of the Respondent's escrow accounts. During the audit, it was discovered that one hundred and seventeen of the one hundred and thirty leases stated that the security deposits were being held in an non-interest bearing account. The leases which stated that the deposits were in an interest bearing account were signed after the Respondent purchased the corporation. The one hundred and seventeen leases with a non-interest bearing escrow were signed by the tenants prior to the stock transfer. There were no allegations that interest had actually been paid by the bank on the escrow account or that there had been any failure by the Respondent to account for the interest to the tenants, the actual owners of the funds. In mitigation, the Respondent stated that once he was made aware of the problems and truly understood the Department's concerns, a letter was sent to each tenant explaining the placement of the security deposits into an interest bearing escrow account on January 23, 1989. These letters were sent on April 3, 1989. In addition, a new real estate lease was prepared on behalf of the corporation by an attorney. The purpose of the new lease was to explicitly state the rights and responsibilities of the parties regarding the interest on these accounts. In this case, no one was cheated, no secret commissions were earned, and the sums in question were trifling.
Recommendation Accordingly, based upon the foregoing, it is RECOMMENDED: That the Respondent McVety be found guilty of having violated Rule 21V- 14.014, Florida Administrative Code, and is therefore in violation of Section 475.25(1)(e), Florida Statutes. This violation was originally Count II of the Administrative Complaint. Counts I and II, having been withdrawn, are dismissed. That the Respondent McVety be issued a written reprimand as the penalty for the one violation. DONE and ENTERED this 30th day of January, 1990, in Tallahassee, Leon County, Florida. Copies furnished: John R. Alexander, Esquire DPR - Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 John A. McVety 3120 Grand Avenue Fort Myers, Florida 33901 Darlene F. Keller Executive Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 VERONICA E. DONNELLY Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of January, 1990. Kenneth E. Easley, Esquire General Counsel Department of Professional Regulation 1940 North Monroe, Suite 60 Tallahassee, FL 32399-0792
The Issue The issue in this case is whether the real estate license issued to the Respondent, James P. Hudson, should be revoked or otherwise disciplined based upon the acts alleged in the Administrative Complaint.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, I make the following findings of fact: At all pertinent times, Respondent, James P. Hudson, was a licensed real estate broker in the State of Florida having been issued license No. 0148841 in accordance with Chapter 475, Florida Statutes. Respondent has been operating as a broker from an office at 413 South Federal Highway, Boynton Beach, Florida 33435. Respondent maintains an escrow account No. 018200602689 at Sun Bank in Boynton Beach, Florida into which he deposits trusts funds received in his capacity as a real estate broker. Sometime in the early part of September 1989, Petitioner initiated a random audit of Respondent's business. Prior to the audit, Petitioner's investigator advised the Respondent that he would need to produce all the records related to his escrow account. An investigator for Petitioner visited Respondent's office on or about September 18, 1989 to conduct an audit of Respondent's escrow accounts. Based upon the investigator's review of the records, five different transactions were identified as allegedly involving delays or mishandling of escrow funds by Respondent. Those transactions are the basis for several of the allegations in the Administrative Complaint. Each transaction is addressed separately below. The first transaction involved a contract for the sale and purchase of real property between Fitz as buyer and Kerstin as seller (the "Fitz Contract"). Included in Respondent's files on this transaction was a copy of a contract for sale and purchase that was dated and signed by the buyer on September 6, 1989 and dated and signed by the seller on September 9, 1989. The buyer in the Fitz Contract gave Respondent a check for $1000 as a deposit to be held in escrow in connection with the transaction. The Respondent's written receipt for that check is dated September 7, 1989. The evidence established that this initial deposit check was delivered to Respondent on Thursday evening, September 7, 1989. Respondent was out of town on Friday, September 8 and returned on Monday evening, September 11. The check was deposited on the afternoon of September 12 and is reflected in the bank records as a deposit on September 13. The sellers (the Kerstins) signed the contract on September 9, 1989. However, in executing the contract, they crossed out the $900,000 sales price submitted by the buyer and increased the price to $1,400,000. In other words, the sellers made a counteroffer with respect to this contract. The initial deposit was timely returned to the sellers when the counteroffer was rejected. Petitioner's investigator erroneously assumed that Respondent did not timely collect the additional deposit required under this contract. While Petitioner's investigator considered this signed contract in Respondent's files to be a binding agreement on the parties, it is clear that the change in sales price was only initialed by the sellers and, therefore, there was no enforceable agreement. The parties to the Fitz Contract subsequently executed another written contract. This second agreement provided for a sales price of $1,100,000. That contract was executed by the buyer on September 20, 1989 and by the sellers on September 24, 1989. This second contract called for a $49,000.00 deposit upon acceptance. The buyers gave Respondent a check dated September 25, 1989 in the amount of $49,000.00. That check was deposited by Respondent in his escrow account on the afternoon of September 26, 1989. The $49,000 deposit is reflected in the bank records as being deposited on September 27, 1989. Under the circumstances, there was no undue delay by Respondent in collecting or depositing the funds into escrow. The second transaction identified by Petitioner's investigator involved a contract for the sale and purchase of real property between Campanis as buyer and Hoffman as seller. The buyer in this transaction gave Respondent a check dated September 6, 1990 to be held as a deposit for this contract. A photocopy of the check presented to Petitioner's investigator included a handwritten note that states "hold until Friday 9/8/89." The evidence did not establish who wrote this note. The evidence established that the check was received by one of Respondent's sales associates on September 7 and left on the Respondent's desk on September 8. Respondent is the only company employee authorized to deposit checks or otherwise handle transactions involving the escrow account. As indicated above, Respondent was out of town from September 8 through the evening of September 11. The check was deposited on the afternoon of September 12 and is reflected in the bank records as being credited to the escrow account on September 13. Under the circumstances, the Respondent was not delinquent in depositing these funds. The third transaction involved a contract for the purchase and sale of real property between White as buyer and Adkins as seller (the "White Contract.") The White Contract was executed by the buyer on July 26, 1989 and by one of the sellers on July 27 and by the other seller on Friday, July 28. The contract called for an initial deposit of $500.00 with an additional deposit of $1,700 upon acceptance. The initial deposit check was dated July 26, 1989. That deposit check was attached to the contract executed by the purchaser and presented to a cooperating real estate agent who was to present the proposed contract to the seller. The executed contract was not returned to Respondent until sometime during the weekend of July 29 and 30. The initial deposit check along with the additional deposit were then deposited into Respondent's escrow account on Monday, July 31, 1989. Under the circumstances, the evidence established that there was no undue delay in depositing the escrow money. The next transaction identified by Petitioner's investigator involved a contract for sale and purchase of real property between Milera as buyer and Twillie as seller (the "Milera Contract.") The Milera Contract provided for an additional deposit due upon acceptance. The contract was accepted by Twillie on August 23, 1989. The parties to the contract agreed that the time for making the additional deposit would be extended for two days. The check for the additional deposit was dated and received by Respondent on Friday, August 25, 1989. The check was deposited into Respondent's escrow account on Tuesday, August 29, 1989. Under the circumstances, there was no undue delay in depositing the escrow money. The final transaction involved a contract with the sale and purchase of real property between Gerrety as buyer and the estate of John Walsh as seller (the "Gerrety Contract.") The Gerrety Contract was executed by the purchaser on August 10, 1989. The deposit check was given to one of the Respondent's associates on that Thursday evening. The deposit check was not delivered to Respondent until after business hours on Friday, August 11. The check was deposited into Respondent's escrow account on Monday, August 14. Under the circumstances, there was no undue delay in depositing the escrow money on this transaction. During the audit, Petitioner's investigator determined that Respondent was holding deposits on two separate rental properties in his escrow account. At the time of the audit, Petitioner's investigator was not provided with any leases or other documentation regarding these transactions even though Respondent was supposed to produce records for all sums in the escrow account. Respondent contends that he did not realize he was supposed to produce his rental files, was never specifically asked to produce these files and did not know that Petitioner was questioning these transactions until he received the Administrative Complaint in this action. While there was apparently some miscommunication at the time of the audit, adequate documentation for these rental deposits was produced at the hearing. Therefore, Petitioner's allegation that Respondent did not maintain adequate documentation regarding these deposits is without merit. Petitioner has also charged that Respondent did not produce all of the deposit slips in connection with the escrow account and did not produce any evidence of reconciliation of the escrow account. The evidence at the hearing established that all deposit slips are available even though they were not all kept with the bank statements. Moreover, the evidence failed to substantiate the allegation that Respondent did not reconcile his escrow account. Thus, these charges were not substantiated. At the time of the audit, Respondent advised Petitioner's investigator that the escrow account included some commission money that had not yet been removed. In the past, Respondent would sometimes collect his commissions at the close of a transaction from the funds held in escrow. (Respondent no longer collects commissions in this manner.) In auditing Respondent's escrow account, Petitioner's investigator determined that there was an overage of approximately $8,178.17 in the account. Within thirty days of the completion of the audit, Respondent removed $7,500 of the overage which represented his commission on two previously closed transactions. While Respondent believed that the remaining amount of the overage was also his commission money, he refrained from removing any more money until completion of a year-end audit by his accountant. Respondent's records reflected a slight difference in the amount of the overage than the amount calculated by Petitioner during the audit. Respondent wanted to be absolutely certain that only the proper amount was removed from the escrow account. At the conclusion of the audit on September 18, 1989, Respondent signed an office inspection report form prepared by Petitioner which contained the following pre-printed statement: ...I certify that to the best of my knowledge all records pertaining to my sales escrow/trust account(s) and my rental property management account(s) have been provided to the investigator. The above violations are brought to my attention this date and thoroughly explained. I will take corrective action within thirty days and furnish photo/sketches of corrections and documents on the same... There is some confusion as to what additional documentation Respondent was expected to provide following the completion of the September, 1989 audit. Respondent did not believe he was required to provide any additional evidence to Petitioner or its investigator and no further documentation was provided by Respondent until Petitioner's investigator returned to his office in January of 1990. Petitioner's investigator returned to Respondent's office on January 17, 1990. At that time, $7500.00 of the overage had been removed from the escrow account. The remaining amount of the overage was removed later in January. It does not appear that Respondent provided Petitioner's investigator with copies of the rental agreements or the second contract in the Kerstin transaction during the January visit by Petitioner's investigator. Respondent contends that this information was never specifically requested. It is clear that communication between Respondent and Petitioner's investigator had deteriorated from bad to worse by the time of this January visit. There is no indication that Respondent ever used the escrow account for improper purposes or withdrew money from the escrow account for his own personal or business use. The Florida Real Estate Commission adopted new record keeping requirements regarding escrow accounts in July of 1989. The new rules require a written monthly reconciliation of a broker's escrow account. At the time of the audit, Respondent was not keeping the minimum written statement comparing broker's total liability with the reconciled bank balance of all trust accounts as required by the new rules. Even after the audit in September, Respondent did not keep the written reconciliations in the format required by the new rules. Respondent was reconciling the account on his computer.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Petitioner enter a Final Order finding Respondent not guilty of the allegations contained in Counts I and II of the Administrative Complaint, finding Respondent guilty of Counts III and IV and reprimanding him for minor and techinical violations of those counts and imposing a fine of $100.00. RECOMMENDED in Tallahassee, Leon County, Florida, this 31st day of December, 1991. J. STEPHEN MENTON 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 31st day of December, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-3589 Both parties have submitted Proposed Recommended Orders. The following constitutes my rulings on each of the parties' proposed findings of fact. The Petitioner's Proposed Findings of Fact Proposed Finding Paragraph Number in the Findings of Fact of Fact Number in the Recommended Order Where Accepted or Reason for Rejection. Addressed in the preliminary statement. Adopted in substance in Findings of Fact 1. Adopted in pertinenet part in Findings of Fact 3. Rejected as irrelevant. Rejected as irrelevant. Adopted in substance in Findings of Fact 4. 7. Subordinate to Findings of Fact 5. 8. Subordinate to Findings of Fact 6. 9. Subordinate to Findings of Fact 7 and 8. 10. Subordinate to Findings of Fact 6. 11. Subordinate to Findings of Fact 6. 12. Subordinate to Findings of Fact 8 and 9. 13. Subordinate to Findings of Fact 8 and 9. 14. Subordinate to Findings of Fact 8 and 9. 15. Subordinate 23. to Findings of Fact 8, 9 and Subordinate to Findings of Fact 23. This subject is also addressed in paragraph 9 of the conclusions of law. Adopted in substance in Findings of Fact 10. Adopted in substance in Findings of Fact 10. 19. Subordinate to Findings of Fact 11. 20. Subordinate to Findings of Fact 13. 21. Subordinate to Findings of Fact 13. 22. Subordinate to Findings of Fact 13. 23. Subordinate to Findings of Fact 14. 24. Subordinate to Findings of Fact 14. 25. Subordinate to Findings of Fact 15. 26. Subordinate to Findings of Fact 15. Subordinate to Findings of Fact 16. Subordinate to Findings of Fact 17. Rejected as not established by competent susbstantial evidence. The subject matter is addressed in Findigns of Fact 17. Adopted in substance in Findings of Fact 19 and 20. Rejected as not established by competent substantial evidence. The subject matter is addressed to some degree in Findings of Fact 21. Subordinate to Findings of Fact 21 and 22. Subordinate to Findings of Fact 21 and 25. Adopted in substance in Findings of Fact 20. Rejected as irrelevant. Subordinate to Findings of Fact 21. Subordinate to Findings of Fact 21. The Respondent's Proposed Findings of Fact The Respondent's proposed findings of fact are not numbered. The numbers below refer to the numerical sections contained in the findings of fact section of Respondent's Proposed Recommended Order. Proposed Finding Paragraph Number in the Findings of Fact of Fact Number in the Recommended Order Where Accepted or Reason for Rejection. The first two sentences are adopted in substance in Findings of Fact 6-9. The second two sentences are rejected as irrelevant. This subject matter is addressed in some degree in Findings of Fact 21. The last sentence is rejected as constituting argument rather than a finding of fact. The first two sentencess are subordinate to Findings of Fact 10. The next two sentences are adopted in substance in Findings of Fact 11. The last sentence is rejected as constituting argument rather than a finding of fact. The first two sentence are adopted in substance in Findings of Fact 13. The third sentence is rejected as constituting argument rather than a finding of fact. The first three sentences are adopted in substance in Findings of Fact 14. The last sentence is rejected as constituting argument rather than a finding of fact. The first two sentences are adopted in substance in Findings of Fact 15. The last sentence is rejected as constituting argument rather than a finding of fact. Adopted in substance in Findings of Fact 16. The first sentence is adopted in substance in Findings of Fact 17. The second sentence is rejected as vague. Subordinate to Findings of Fact 17 and 25. The first three sentences are adopted in substance in Findings of Fact 18, 19 and 22. The fourth sentence is rejected as not established by competent substantial evidence. This subject matter is addressed in part in Findings of Fact 19. The fifth and sixth sentences are rejected as constituting argument rather than a finding of fact. Subordinate to Findings of Fact 25. COPIES FURNISHED: Janine B. Myrick, Esquire Senior Attorney Department of Professional Regulation Division of Real Estate 400 West Robinson Street P. O. Box 1900 Orlando, Florida 32802 James P. Hudson 413 South Federal Highway Boynton Beach, Florida 33435 Darlene F. Keller Executive Director Department of Professional Regulation Division of Real Estate 400 West Robinson Street P. O. Box 1900 Orlando, Florida 32802 Kenneth E. Easley, Esquire General Counsel Department of Professional Regulation 1940 North Monroe Street Suite 60 Tallahassee, Florida 32399-0792
The Issue Whether the Respondents committed the offenses alleged in the Amended Administrative Complaint and the penalties, if any, that should be imposed.
Findings Of Fact Petitioner is the agency of the State of Florida charged with the responsibility and duty to administer the statutes and rules regulating the real estate profession in Florida. At all times pertinent to this proceeding, the Respondent, Jose A. Queipo, Jr., was licensed by the Petitioner as a real estate broker, having been issued license numbers 0415475 and 3001474. At all times pertinent to this proceeding, the Respondent, Queipo International Realty, Inc. (REALTY), was licensed by the Petitioner as a real estate brokerage corporation, having been issued license number 0271997. At all times pertinent to this proceeding, Mr. Queipo was the sole corporate officer, sole owner, and sole broker of record for REALTY. At all times pertinent to this proceeding, until January 27, 1995, REALTY's offices were located at 2320 Red Road, Miami, Florida. In 1994, Mr. Queipo made the business decision to form Queipo International Realty Group, Inc., (GROUP) as a separate corporation and, through GROUP, to open a real estate office on Crandon Boulevard, Key Biscayne, Florida. Andrew Marrero, a licensed real estate broker had been a long term friend of Mr. Queipo and had worked with him at REALTY. Mr. Queipo gave Mr. Marrero 50 percent ownership interest in GROUP and had Mr. Marrero act as the qualifying broker of record for GROUP. In December, 1994, Mr. Queipo became ill. On medical advice, he took an extended vacation, leaving Mr. Marrero in charge of REALTY and GROUP. Mr. Queipo and Mr. Marrero agreed that the REALTY offices on Red Road would be closed and that all pending transactions for which REALTY was responsible (15 to 20 in number) would be closed by GROUP. The GROUP office was thereafter opened on Key Biscayne. Before he left on his vacation, Mr. Queipo signed a number of blank checks on REALTY's various trust and operating bank accounts and he signed several sheets of stationery with REALTY's letterhead. Mr. Queipo turned these signed blank checks, signed sheets of stationery, and all books and records of REALTY over to Mr. Marrero. Mr. Queipo also pre-signed checks on GROUP's bank accounts and executed a corporate document that allowed Mr. Marrero to change those accounts so that only Mr. Marrero's signature was necessary. On January 27, 1995, Mr. Queipo was still out of state on his vacation. On that date, Mr. Marrero closed the REALTY offices without advance notification to the sales persons and other personnel employed at that office. Mr. Marrero took possession of all equipment, furniture, files, and corporate records and moved these items either to the GROUP office on Key Biscayne or to his personal residence. Between the time he left on his vacation in December 1994, and March 1995, Mr. Queipo returned to Miami only for a day to attend the closing of the sale of the REALTY office building on Red Road. While he was away from Miami between December 1994 and March 1995, Mr. Queipo stayed with relatives in New York and rested. During this period, Mr. Marrero was in control of REALTY and GROUP. Mr. Queipo did not return to Miami permanently until March 1995. When he returned to Miami in March 1995, Mr. Queipo sought an accounting from Mr. Marrero as to the status of REALTY and GROUP. Mr. Marrero responded by locking Mr. Queipo out of the offices of GROUP. Mr. Queipo filed suit in circuit court in Miami against Mr. Marrero in May 1995. In June 1995, Mr. Marrero was ordered by the presiding circuit judge to turn all books and records of GROUP and of REALTY to the Century 21 Regional Offices so that an accounting could be performed. It was not until August 1995 that Mr. Queipo regained control of REALTY and of GROUP. Petitioner determined that it would be appropriate to audit the escrow accounts and other books and records of REALTY in January 1995, prior to the abrupt closing of the REALTY offices on January 27, 1995. Two of Petitioner's investigators, Kenneth Rehm and Roberto Castro, went to the REALTY office during regular business hours prior to January 27, 1995, for the purpose of conducting the audit. The investigators asked to see Mr. Queipo and were told by a receptionist that Mr. Queipo was not available. The investigators were unable to conduct the planned audit. Shortly after the REALTY office on Red Road was closed on January 27, 1995, the Petitioner was notified of this fact by sales persons who had worked at that office. REALTY never maintained or operated an office at any other location after January 27, 1995. Petitioner's investigators made diligent efforts to subpoena the REALTY records so that they could perform an audit and they attempted to communicate with Mr. Queipo through his brother-in-law and through Martha Lara, a secretary who worked for REALTY. 1/ Petitioner's investigators were unable to perfect the service of a subpoena for REALTY's records until Mr. Rehm served Mr. Queipo in person at the Dade County Courthouse on May 30, 1995. Mr. Queipo was at the Courthouse for a hearing pertaining to the litigation he instigated against Mr. Marrero. This subpoena required Mr. Queipo to produce the following records of REALTY: . . . brokerage records for the period January 1, 1994 to present including: All listing agreements. All sales/purchase agreements/rental/ lease agreements. All escrow account monthly bank state- ments, bank deposit slips and cancelled checks. Operating account bank statements, deposit slips, and cancelled checks. Monthly reconciliations showing broker's total trust liability. In response to that subpoena, counsel for Mr. Queipo responded by letter dated June 12, 1995, that stated, in pertinent part, as follows: Please be advised that the undersigned represents Jose Queipo, broker, owner of a corporation no longer in business called Queipo International Realty, Inc. Mr. Kenneth Rehm personally served a subpoena . . . upon Mr. Queipo in relation to Queipo International Realty, Inc. . . . * * * . . . all matters contained within the body of the subpoena are presently lodged with and or controlled by Queipo International Group, Inc. and Mr. Andrew Marrero. As Mr. Kenneth Rehm knows, Queipo Inter- national Group Inc. has been controlled by a Mr. Andrew Marrero since a dispute arose with Mr. Queipo. As of this date Mr. Marrero retains all of the relevant records of Queipo Inter- national Realty Inc. that were taken by him in January of 1995 to Queipo International Group, Inc.'s new headquarters on Crandon Blvd. as part of the merger and formation of the new company . . . . As of the time of the formal hearing, the Respondents had not provided Petitioner with records that would enable Petitioner to audit the REALTY escrow accounts. At the times pertinent to this proceeding, REALTY had more than one escrow account. One of these escrow accounts was account number 0024012750 at the Interamerican Bank. Petitioner established that as of January 31, 1995, the account liability (at least $28,200) exceeded the account balance ($13,794.41). This discrepancy was detected after Mr. Queipo had given Mr. Marrero control of the escrow accounts and had given him signed, blank checks that enabled him to make withdrawals from the escrow accounts. Although Respondents established that REALTY had more than one escrow account, that fact does not explain the apparent discrepancy in account number 0024012750 at the Interamerican Bank. At all times pertinent to this proceeding, Respondents knew that the records of REALTY were subject to audit by the Petitioner. REALTY's records had been routinely audited on three separate occasions prior to 1995 with no errors having been detected. Prior to October 1994, REALTY had a listing agreement for the sale of property owned by Wilma Sue Lawton. The REALTY sales persons for this transaction were Ann Freeman and Yolanda Rocabado. On October 19, 1994, a contract for the sale of the Lawton property was executed between Ms. Lawton as seller and Mario N. and Elisa V. Machin as buyers. This contract provided for REALTY to receive a six percent commission when the sale closed. Since the sales price equalled $100,000, the amount of the real estate commission was $6,000. In connection with this transaction, the Machins paid to REALTY a deposit in the amount of $10,000, which was placed in account number 0024012750 at the Interamerican Bank. After REALTY closed its office on January 27, 1995, Ms. Freeman became associated with a real estate company named Vision International Realty (VISION) and Ms. Rocabado became associated with GROUP. On January 31, 1995, REALTY's listing agreement with Ms. Lawton expired. On February 3, 1995, Ms. Lawton executed a listing agreement with VISION. This listing agreement provided for VISION to receive the six percent real estate commission. On February 3, 1995, Ms. Lawton and Mr. and Ms. Machin executed a "Release on (sic) Deposit Receipt" that released the $10,000 deposit that had been placed in escrow by REALTY pursuant to the contract dated October 19, 1994. By an instrument executed by the Machins on February 3, 1995, and by Ms. Lawton on February 8, 1995, the parties entered into a second contract for the purchase and sale of the Lawton property. There were no material differences between the contract executed in February 1995 and the contract dated October 19, 1994. This second contract provided that VISION and GROUP would evenly split the six percent commission. The closing for this transaction was scheduled for on or before March 4, 1995. Approximately two weeks prior to the scheduled closing, VISION asked that REALTY transfer the $10,000 escrow deposit to a VISION escrow account so that the funds would be available for the closing and provided a copy of the "Release on Deposit Receipt". At the time REALTY received the "Release on Deposit Receipt" and the request to transfer those funds, Mr. Marrero was in de facto control of both REALTY and GROUP. Thereafter, a REALTY check that had been pre-signed in blank by Mr. Queipo and an unsigned cover letter on REALTY letterhead were sent to the attorney who as acting as the closing agent for the transaction. The amount of the check sent to the closing agent was $7,000. The unsigned transmittal letter referenced the Lawton to Machin transaction and provided, in pertinent part, as follows: Receipt is hereby acknowledged in the amount of $6,000 (Six Thousand Dollars) as a professional fee for the above referenced property. Please be advised that the [sic] $3,000 of the above captioned in dispute is being forwarded to the title agent as agreed until this matter is settled among the brokers. The closing agent correctly understood the cover letter to mean that REALTY was keeping $3,000 of the $10,000 that had been deposited as part of its commission and that REALTY was also claiming it was entitled to receive an additional commission of $3,000 from the $7,000 check it forwarded to the closing agent. There was no dispute that the total commission, in the amount of $6,000, was to be paid from the $10,000 deposit that had been placed in REALTY's escrow account in October 1994. There was also no dispute that either REALTY or GROUP was entitled to $3,000, representing one half of the total real estate commission. The other half of the commission was in dispute and was forwarded by REALTY as part of the $7,000 it forwarded to the closing agent. Since Mr. Marrero was in control of REALTY and GROUP, it is concluded that REALTY's claims to the entire commission effectively waived any claim GROUP may have had to half of the commission. As a result of the commission dispute between REALTY and VISION, the closing agent treated $3,000 of the $7,000 as being in dispute and not available for use in closing the transaction. VISION objected to the transaction closing without it being paid the $3,000 commission it was claiming. The transaction closed because the buyers paid into the closing agent's escrow account an additional sum of $3,000, which was used to pay VISION's commission. The sum of $3,000 remains in the closing agent's escrow account pending resolution of the dispute over this part of the commission. Depending on the resolution of REALTY's commission claim, the sum belongs to either REALTY or to the Machins. No formal action has been taken to resolve the dispute over this commission. The sum of $3,000 remained in the closing agent's escrow account at the time of the formal hearing. In conjunction with a transaction involving a seller named Sergio Rodriguez and a buyer named Aristomanis Atheras, REALTY received an escrow deposit in the amount of $15,500. Respondents thereafter received conflicting demands for that deposit. On November 17, 1994, REALTY filed an interpleader action in Dade County Circuit Court. REALTY was represented in this matter by an attorney named Raymond Albo. On June 6, 1995, REALTY was ordered by the circuit court to deposit the escrowed funds into the registry of the court "forthwith". Respondents did not comply with that order. Mr. Queipo testified, credibly, that Mr. Albo failed to advise him of that order. On October 19, 1995, the circuit court entered an "Order to Show Cause" which ordered Mr. Queipo to show cause at a hearing scheduled for November 9, 1995, why he should not be held in contempt of court for failing to comply with the order if June 6, 1995. On November 8, 1995, Mr. Albo contacted Mr. Queipo for the first time in a year and told him about the Order to Show Cause. Mr. Queipo determined that the remaining REALTY escrow account had a balance of $11,000. He withdrew the sum of $11,000 from the escrow account, added $4,500 of his personal funds to that figure, and paid into the registry of the court the sum of $15,500 on November 9, 1995, thereby avoiding the contempt proceeding. i 33. Jorge Areces was acting as the general counsel for Respondents in November 1994. It was Mr. Areces who recommended that Mr. Albo be retained to represent REALTY in the interpleader action. Both Mr. Areces and Mr. Queipo made repeated efforts to contact Mr. Albo about the status of the interpleader action, but they were unable to locate him. Respondents relied on the advice of their attorneys in dealing with the interpleader action.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order that incorporates the findings of fact and conclusions of law contained herein, that finds Respondents guilty of the offenses alleged in Counts XIII, XIV, XVII, and XVIII, and that dismisses the remaining counts of the Amended Administrative Complaint. It is recommended that for the violations found herein, Respondents be fined in the total amount of $4,000 and that their respective licenses be placed on probation for a period of five years. DONE AND ENTERED this 21st day of October, 1996, in Tallahassee, Florida. CLAUDE B. ARRINGTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 21st day of October, 1996.
The Issue The issue for determination at the final hearing was whether the Respondent violated the real estate licensing law, as alleged in the Administrative Complaint, by failing to account and deliver a deposit; failing to maintain a deposit in a real estate brokerage escrow account or some other proper depository until disbursement thereof was properly authorized; and/or being guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, and/or breach of trust in a business transaction.
Findings Of Fact Based on my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, I hereby make the following findings of fact: Respondent is now, and was at all times material hereto, a licensed real estate broker in the State of Florida having been issued license number 0360741. The last license issued was as a broker, c/o Consolidated American Realty Services, Inc., in Tampa, Florida. From June 6, 1983, through June 25, 1984, Respondent was licensed and operating as a real estate broker under the trade name, "Benjamin Realty," in Tampa, Florida. For sometime prior to June 2, 1984, Eileen Cumbie attempted to sell a lot owned by her located at 1102 26th Avenue, Tampa, Florida. On June 2, 1984, the Respondent contacted Ms. Cumbie and informed her that he had a client interested in purchasing the property. Ms. Cumbie informed the Respondent that as long as she netted a certain amount, she would be willing to sell the property. Ms. Cumbie allowed the Respondent to put together a contract for the sale of the lot. In connection therewith, the Respondent prepared a sales contract with Danilo Castellanos, as purchaser, and Eileen W. Cumbie, as seller, for the purchase and sale of the property. Pursuant to the purchase and sales agreement, the Respondent received in trust from Mr. Castellanos a $500 earnest money deposit via check dated June 2, 1984. On June 5, 1984, the Respondent deposited the check into his real estate brokerage account maintained at the Central Bank of Tampa, 2307 W. Rennedy Boulevard, Tampa, Florida. Mr. Castellanos entered into the contract for the benefit of his son and daughter-in-law who resided in New Jersey but were planning to relocate to the Tampa area. Mr. Castellanos' daughter-in-law went to look at the lot on June 10, 1984 and decided that she did not like the area in which it was located. The closing of the transaction was set for June 15, 1984. On approximately June 13, 1984, Mr. Castellanos' daughter- in-law informed the Respondent that they were no longer interested in purchasing the property. Ms. Cumbie was out of town during the time of the scheduled closing, but had prepared and signed all of the paperwork in advance. When she returned after June 15, 1984, she called Respondent to find out how the closing went. The Respondent informed her that the buyers failed to go through with the transaction. The contract provided in part as follows: ". . . If the buyer fails to perform this contract within the time specified herein, time being of the essence of this agreement, the deposit made by the buyer shall be disposed of in the following manner: To the Broker an amount equal to his earned commission, but not to exceed 1/2 of the deposit which shall discharge the sellers obligation to him for that service; remainder to the seller to be credited to him against his damages accrued by reason of the breach of contract. " After the transaction failed to close, Ms. Cumbie requested that Respondent give a portion of the deposit to her. The Respondent told Ms. Cumbie that he would give her the entire deposit because she had paid for the survey and a few other items to facilitate the closing of the transaction. Over the next several months, the Respondent, on several occasions, promised to deliver a check to Ms. Cumbie. However, the Respondent never delivered any such check to Ms. Cumbie. Because the Respondent failed to provide Ms. Cumbie with a share of the earnest money deposit, she initiated a civil action in the County Court of Hillsborough County. On October 15, 1985, Ms. Cumbie was awarded a final judgment in the amount of $250 against Respondent for her share of the forfeited earnest money deposit. As of the date of the final hearing, the Respondent had not satisfied the judgment and Ms. Cumbie had not received any proceeds from the forfeited earnest money deposit. Shortly after the transaction failed to close, the purchasers requested that the Respondent return the earnest money deposit to them. However, the Respondent informed them that they were not entitled to the return of the earnest money deposit. The earnest money deposit was never returned to the purchasers. On July 31, 1984, the balance in Respondent's escrow account was $568.83. However, on September 1, 1984, the balance in the Petitioner's escrow account fell to S18.83. From October 31, 1984 to January 1, 1986, the balance in the Petitioner's escrow account remained $3.83.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is therefore, RECOMMENDED that the registration of Fortunato Benjamin- Pabon as a real estate broker be revoked. DONE and ORDERED this 18th day of June, 1986, in Tallahassee, Florida. W. MATTHEW STEVENSON, 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 18th day of June, 1986. COPIES FURNISHED: Arthur R. Shell, Jr., Esquire Department of Professional Regulation 400 W. Robinson Street Orlando, Florida 32801 Fortunato Benjamin-Pabon 2729 N. Ridgewood Avenue, #1 Tampa, Florida 33602 Harold Huff, Executive Director Department of Professional Regulation Division of Real Estate P. O. Box 1900 Orlando, Florida 32802 Fred Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Salvatore A. Carpino, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
Findings Of Fact Petitioner is the state licensing and regulatory agency charged with the responsibility and duty to prosecute administrative complaints filed pursuant to Chapters 455 and 475, Florida Statutes, and rules promulgated pursuant thereto. Respondent is a Florida licensed real estate broker and has been at all times material hereto, having been issued license number 0094373. On or about October 18, 1991, a contract to purchase real estate was entered into by Michael E. Toppin and Velma Richardson, as buyers, with Steven and Kenneth Halpern, as sellers. In accordance with the terms of the contract, an earnest money deposit of $3,000 was given to Respondent to be placed in escrow. The deposit was paid by Ms. Richardson in two checks: one for $1,000 on October 15, 1991, and one for $2,000 on October 29, 1991. The contract did not close because the buyers failed to qualify for sufficient financing, which was a contingency of the contract. Since the contract did not close, Ms. Richardson and Mr. Toppin requested Respondent to return the $3,000 earnest money deposit, but Respondent refused. Ms. Richardson and Mr. Toppin contacted Petitioner for assistance in obtaining the return of the deposit. Respondent was unsure as to who--the buyers or the sellers--should receive the earnest money deposit, so he requested, pursuant to Section 475.25(1)(d), Florida Statutes, the Florida Real Estate Commission to issue an escrow disbursement order. In an order, dated May 20, 1992, the Commission ordered Respondent to disburse the earnest money deposit to the buyers, Mr. Toppin and Ms. Richardson. In accordance with the Commission's order, Respondent issued a $3,000 check, dated June 3, 1992, from his escrow account to the buyers. The buyers endorsed the check and deposited it into Ms. Richardson's account on or about June 8, 1992. The check was returned for non-sufficient funds in Respondent's escrow account. Ms. Richardson contacted Respondent about the returned check. Respondent immediately contacted his bank and deposited sufficient funds to cover the returned check. Respondent failed to contact Ms. Richardson to inform her that sufficient funds were now in the escrow account. Ms. Richardson wanted to be certain that the check would be processed the second time around, so she waited a few days before re-depositing it. On or about June 18, 1992, Ms. Richardson re-deposited the returned check. This time the check cleared. Respondent's escrow account statements reveal that the buyers' checks for $1,000 and $2,000 were deposited into his escrow account on October 15, 1991, and October 29, 1991, respectively--the same day he received them. 2/ However, at no time, during the month of October 1991, did Respondent's escrow account have a balance of $3,000. During October 1991, Respondent made cash withdrawals from his escrow account totalling $975.00, all for personal use. 3/ Also, he paid personal obligations from his escrow account totalling $429.30. At the end of October 1991, Respondent's escrow account had a balance of $2,174.89. Consequently, the escrow account had a shortage of $825.11, as it relates to the $3,000. In November 1991, Respondent's escrow account had activity of six transactions. There were cash withdrawals totalling $2,000, and only twice was the daily balance $3,000 or above. In December 1991, Respondent's escrow had again six transactions of activity, with only one cash withdrawal of $300. Furthermore, Respondent withdrew $1,404.30 for his personal use. The escrow account's daily balance was below $3,000 for three of the six transactions. In January 1992, there were three transactions, including a cash withdrawal of $125. No daily balance was below $3,000 for this month. In February 1992, six transactions were made. Cash withdrawals were made totalling $650. 4/ For February, no daily balance was below $3,000. In March 1992, only two transactions were made. Respondent's escrow account had a cash withdrawal of $320. March contained no daily balance below $3,000. From April 1992 through June 1992, Respondent's escrow account had a daily balance consistently below $3,000. In April 1992, Respondent's escrow account had four transactions, with a cash withdrawal of $1,100. In May 1992, there were five transactions, with cash withdrawals totalling $350. In June, the month that the Respondent wrote Ms. Richardson a $3,000 check from the escrow account, 13 transactions were made and the daily balance was above $3,000 only on three of the transactions. At the end of June 1992, Respondent's escrow account had a negative balance of $406.87. At the end of July 1992, Respondent's escrow account had a positive balance of $11.13. Only three transactions were made for the month. At all times material hereto, Respondent was the only authorized signatory for the escrow account. Respondent admitted that at no time did he prepare and sign written monthly reconciliation statements comparing his total trust liability with the reconciled bank balances even though he was aware that he was required to make the reconciliation statements. The Hearing Officer does not find persuasive Respondent's argument at hearing that he also believed that there were sufficient monies in the accounts at all times equalling escrowed amounts. The escrow bank's monthly statements clearly showed, if Respondent had reviewed them, that the escrow account was for several months below the escrowed amount of $3,000. At all times material hereto, Respondent did not have an operating account for his real estate business. He believed that he could withdraw funds from the escrow account for his personal use if the funds withdrawn were due him in accordance with real estate contracts or agreements. 5/ Respondent did not believe that he had to or was required to transfer those monies due him to a separate account and write checks from that separate account. Respondent has been licensed for approximately 20 years and has had no disciplinary action taken against his license. Respondent presented mitigating circumstances in his behalf. He explained the period of time material hereto as very stressful and as a time in which real estate was not a primary concern for him. Around May 1991, his sister had a reoccurrence of cancer. His sister and his mother who had Alzheimers disease lived together in southeast Miami, Florida, and his sister took care of their mother. As his sister's condition worsened, Respondent spent more and more time with his sister and mother, and less time on his real estate business. His sister died on October 13, 1992. Another mitigating factor presented was that Respondent has had no disciplinary action taken against his license in his approximately 20 years of licensure.
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: Determining Henry M. Weiss guilty of violating Subsections 475.25(1)(b), 475.25(1)(d)1, and 475.25(1)(k), Florida Statutes, as set forth in the Administrative Complaint; and Imposing an administrative penalty comprised of an administrative fine in the amount of Three Thousand Dollars ($3,000), a 90-day suspension, and one year probation, commencing after the suspension, under such terms and conditions as may be prescribed by the Real Estate Commission. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 8th day of April 1993. ERROL H. POWELL Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 8th day of April 1993.
Findings Of Fact Petitioner is the governmental agency responsible for issuing licenses to practice real estate. Petitioner is also responsible for regulating licensees on behalf of the state. Respondent, John P. Wickersham ("Wickersham"), is licensed as a real estate broker under license number 0095775. Respondent, Aladdin Real Estate of Rockledge ("Aladdin"), is a Florida corporation registered as a real estate broker under license number 0213244. Wickersham is the qualifying broker and corporate officer for Aladdin. Respondents maintain their escrow account at the Barnett Bank of Cocoa. On April 28, 1994, Ms. Marie Ventura, Petitioner's investigator, audited Respondents' escrow account. Ms. Ventura concluded that Respondents' escrow account had a liability of $46,287.30 and a reconciled balance of $43,557.26. Ms. Ventura concluded that Respondents' escrow account had a shortage of $2,730.04. Respondents provided Ms. Ventura with additional information. On May 16, 1994, Ms. Ventura concluded that Respondents' escrow account had a liability of $43,546.21 and a reconciled balance of $42,787.26. Ms. Ventura concluded that Respondents' escrow account had an excess of $11.05. Respondents never had a shortage in their escrow account. Respondents maintained an excess of $11.05 in their escrow account since September, 1993. In September, 1993, Respondents converted their method of bookkeeping to a computer system. The computer system failed to disclose an excess of $11.05 due to Respondents' misunderstanding of the appropriate method of labeling inputs to the software system. Respondents discovered and corrected the error prior to the formal hearing. Respondents properly made and signed written monthly reconciliation statements comparing their total escrow liability with the reconciled bank balances of their escrow account. Although Respondents did not use the form suggested in Rule 61J2- 14.012(2), Respondents satisfied the substance of the requirements for record keeping and reporting. Respondents maintained the information required in Rule 61J2-14.012(2) in bank statements, ledger cards, and checkbooks. At the time of the formal hearing, Respondents presented the information in a form that complied with the requirements of Rule 61J2-14.012(2). The shortage determined by Petitioner on April 28, 1994, was caused, in part, by errors made by Petitioner's investigator. It was the investigator's first audit, and the information provided by Respondents was not in an easily discernible form. However, Respondents never withheld any information, and Respondents maintained and provided all information required by applicable law.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a Final Order finding Respondent not guilty of violating Section 475.25(1)(b) and Rule 61J2-14.012(2). RECOMMENDED this 18th day of January, 1996, in Tallahassee, Florida. DANIEL MANRY, 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 18th day of January 1996.
Findings Of Fact At all times material to this case, Respondent, Antonio Prado, has been a licensed real estate broker in the State of Florida, license no. 0138312. Respondent, Antonio Prado, is the President and qualifying broker for a real estate company called Bayside International Realty, Inc. Respondent, Bayside International Realty, Inc., has been issued real estate license no. 1001760. The Department is the state agency charged with the responsibility of regulating real estate licensees. On January 13, 1995, an investigator employed by the Department conducted an office inspection and audit of the Respondents' place of business. During the course of the audit, the investigator discovered that the escrow account for the business contained $1,000.00. None of the $1,000.00 was, in fact, "trust funds" owed or belonging to a third party as Respondents have not held "trust funds" since August, 1990. The investigator advised Respondent that he was not allowed to hold personal funds in excess of $200.00 in the company escrow account. Based upon that information, Respondent immediately, on January 13, 1995, removed $800.00 from the escrow account leaving a balance of $200.00. The purpose of holding $1,000.00 in the account related to a Barnett Bank policy which required the minimum balance of $1,000.00 to avoid service charges on the account. Respondent, Antonio Prado, has not been active in the real estate practice for several years and was unaware of changes to the escrow policy dating back to December, 1991, which prohibit more than $200.00 of personal funds in an escrow account. Respondent, Antonio Prado, has been licensed for 19 years and has never been disciplined for any violations of the real estate law.
Recommendation Based on the foregoing, it is, hereby, RECOMMENDED: That the Florida Real Estate Commission enter a final order determining the Respondent, Antonio Prado, committed only a minor technical violation of Section 425.25(1)(e), Florida Statutes, and, in recognition of Respondent's exemplary record as a broker, which, along with his willing, immediate action to correct the error, demonstrates sound judgment, issue a letter of reprimand and guidance regarding escrow account rules and regulations. All other allegations against these Respondents should be dismissed. DONE AND ENTERED this 15th day of May, 1996, in Tallahassee, Leon County, Florida. JOYOUS D. PARRISH, 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 May, 1996. APPENDIX TO RECOMMENDED ORDER, CASE NO. 96-0038 Rulings on the proposed findings of fact submitted by Petitioner: None submitted. Rulings on the proposed findings of fact submitted by Respondent: Paragraphs 1 and 2 are rejected as statements of fact as they are restatement of argument or comment made at the hearing. Paragraphs 3 through 6 are accepted. COPIES FURNISHED: Henry M. Solares Division Director Division of Real Estate Department of Business and Professional Regulation Post Office Box 1900 Orlando, Florida 32802-1900 Lynda L. Goodgame General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399 Theodore R. Gay Senior Attorney Department of Business and Professional Regulation Division of Real Estate Rhode Building Phase II 401 Northwest Second Avenue N607 Miami, Florida 33128 Antonio Prado, pro se and as President of Bayside International Realty, Inc. 1390 Brickell Avenue, Suite 230 Miami, Florida 33131
The Issue The issue presented is whether Respondents are guilty of the allegations contained in the Administrative Complaint filed against them, and, if so, what disciplinary action should be taken against them, if any.
Findings Of Fact At all times material hereto, Respondent Richard Shindler has been a licensed real estate salesman in the State of Florida, having been issued License No. 0395044. The last license issued was as a salesman with Global Real Estate & Management, Inc. At all times material hereto, Respondent Global Real Estate & Management, Inc., has been a corporation registered as a real estate broker in the State of Florida, having been issued License No. 0223589. At all times material hereto, Mark H. Adler was licensed and operated as the qualifying broker and officer of Global Real Estate & Management, Inc. Adler's license is currently under suspension by agreement with Petitioner as a result of the activities complained of in the Administrative Complaint filed in this cause. At no time has Respondent Shindler been a director or officer of Respondent Global Real Estate & Management, Inc. At all times material hereto, Respondent Shindler has been the sales manager for Respondent Global Real Estate & Management, Inc. As the sales manager, Respondent Shindler sometimes helped other salesmen structure financing and helped them with other problems. Respondent Shindler was not responsible for the collection of funds from individual salesmen. Each individual salesman was responsible for collecting funds from any real estate transaction and giving those funds to Respondent Global's bookkeeper for deposit. As sales manager, Shindler was a signatory on the escrow account in order to make disbursements for small transactions mainly involving rental properties. In addition, Respondent Shindler was responsible for the hiring and firing of office personnel. However, he had no control over the contracts of other salesmen. On March 13, 1989, Respondent Shindler, as a private purchaser, made two purchase offers for two pieces of property owned by the same sellers. The purchase offers were for $115,000 and $80,000, respectively, and required that Respondent Shindler place $6,000 and $5,000, respectively, into Respondent Global's escrow account as a deposit on the purchase of the properties. Respondent Global and real estate broker Jay Hirsch were to receive commissions on the sale of the properties. Those offers to purchase disclosed in writing that Respondent Shindler was also a licensed real estate salesman. Although both offers to purchase were accepted by the sellers, the transactions involving the purchase of these properties did not close due to Respondent Shindler's inability to obtain financing, which was a contingency of the contracts. In October, 1989, demands for the release of the escrowed monies were made by the sellers and by the sellers' broker Jay Hirsch. They made demand upon Respondent Global's attorney. Additionally, Jay Hirsch made demand on Mark Adler by telephone and then by demand letter to Adler, who, as the qualifying broker for Respondent Global, was responsible for the release of the escrowed funds. Subsequent to the demands made by the sellers and their broker, Respondent Global filed a complaint for interpleader. The escrowed deposits were eventually disbursed pursuant to a settlement among the parties claiming an interest in the escrowed deposits. In March, 1990, Petitioner began an investigation of the Respondents and Adler. Investigators Castro and Rehm both participated in the investigation. Investigator Castro believed Respondent Shindler to be the office manager of Respondent Global. During the initial interview with Respondent Shindler, he produced records which indicated that a deposit of $14,265.69 had been made on January 13, 1989, into Respondent Global's escrow account. This check had been given by Respondent Shindler to Global's bookkeeper for deposit. This deposit represented proceeds from the sale of property owned by Respondent Shindler's brother Paul, and was placed in escrow in anticipation of the offers to purchase made by Respondent Shindler on the two properties involved in this cause. Investigator Rehm examined the escrow account bank records and determined that for a two-month period the escrow account balance had dropped below the minimum $11,000 balance required by the two contracts in question herein alone. Initially, Respondent Shindler advised the investigators that the bank where the escrow account was maintained had represented that it had debited the escrow account as a result of a lien placed on that account by the Internal Revenue Service. Upon further investigation, Respondent Shindler advised the investigators that the bank itself had withdrawn $3,200 from Global's escrow account to cover a shortage in Respondent Global's operating account. At all times material hereto, both Adler and Respondent Shindler were signatories on the escrow account. As part of its investigation, Petitioner served a subpoena on Maria Aguerra, Respondent Global's bookkeeper, requesting from Adler, or Respondent Shindler, or the custodian of records for Respondent Global Real Estate, all contracts, leases, agreements, monthly bank statements, deposit slips, and cancelled checks for all accounts for the period of January 1, 1989, through March 22, 1990. Some of the requested documents were initially unavailable because they had previously been sent to the Florida Real Estate Commission. Although Adler testified that he was initially unaware that a subpoena had been served, he was given a 30-day extension to produce the records when he met with investigators Castro and Rehm on May 1, 1990. Although Adler had both the responsibility for and control over the records of Respondent Global, he was not fully familiar with the records, and the bookkeeping was in disarray. At all times material hereto, Adler, as the broker for Respondent Global, was responsible for operating the Global office, for overseeing Global's escrow account, for reviewing contracts, and for being aware of the day-to-day events in the Global office. In addition, as the broker, Adler was required to be an officer of the corporation, to be a signatory on the escrow account, to have prepared and to sign the monthly escrow account reconciliations, and to respond to Petitioner if there were complaints or requests for production of documents. Adler, as the broker for Respondent Global, did not reconcile and sign escrow account statements on a monthly basis since he was not aware of the requirement that he do so. However, Adler did testify that he was aware of his responsibility for escrowed funds. At no time did Respondent Shindler have the responsibility to maintain Global's escrow account or to reconcile the escrow account on a monthly basis. At no time did Respondent Shindler represent that he was the broker for Respondent Global or that he was a broker. Respondent Shindler did not state to investigator Rehm that he was acting as the broker for Global or that Adler had simply lent Adler's license to Shindler to use. At no time did Adler and Respondent Shindler enter into an agreement whereby Shindler would act as the broker for Global using Adler's broker's license, and Adler was never paid any monies for any use of his broker's license. Adler testified that his involvement with Global's business had declined as he had pursued his growing interest in performing appraisals.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that a Final Order be entered: Dismissing Counts II, III, VII, VIII, and IX of the Administrative Complaint filed herein; Finding Respondent Global Real Estate & Management, Inc., guilty of the allegations contained in Count V of the Administrative Complaint; and Ordering Respondent Global Real Estate & Management, Inc., to pay a fine in the amount of $500 by a date certain. RECOMMENDED in Tallahassee, Leon County, Florida, this 20th day of March, 1991. 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 20th day of March, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-4522 Petitioner's proposed findings of fact numbered 2-5, 7-9, 11-12c, 13, 14, and 16 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed finding of fact numbered 1 has been rejected as not constituting a finding of fact but rather as constituting a conclusion of law. Petitioner's proposed finding of fact numbered 6 has been rejected as being unnecessary for determination of the issues herein. Petitioner's proposed findings of fact numbered 10, 15, and 17 have been rejected as not being supported by the weight of the credible evidence in this cause. Petitioner's proposed finding of fact numbered 12d has been rejected as being irrelevant to the issues under consideration herein. Respondents' proposed findings of fact numbered 1-22 have been adopted either verbatim or in substance in this Recommended Order. The transcript of proceedings, together with Petitioner's Exhibits numbered 3, 5, and 8-14 and Respondents' Exhibit numbered 1 which were admitted in evidence. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation Division of Real Estate - Legal Section 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Harold M. Braxton, Esquire 9100 South Dadeland Boulevard Suite 400 - One Datran Center Miami, Florida 33156 Jack McRay General Counsel Department of Professional Regulation Northwood Centre, Suite 60 1940 North Monroe Street Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801
Findings Of Fact The Department is a state licensing and regulatory agency charged with the responsibility and duty to prosecute Administrative Complaints pursuant to the laws of the State of Florida, in particular, Chapters 120, 455 and 475, Florida Statutes (1991), and the rules promulgated pursuant thereto. The Respondents, Shirley M. Ferguson and Dosh Realty, Inc., are now, and were at all times material hereto, licensed real estate brokers in the State of Florida, having been issued license numbers 0393921 and 0252372, respectively, in accordance with Chapter 475, Florida Statutes. The last licenses issued were as brokers, c/o Dosh Realty, Inc., 595 N. Nova Road 105A, Ormond Beach, Florida 32174. At all times material hereto, Ms. Ferguson was licensed and operating as qualifying broker and officer of Dosh Realty, Inc. On or about August 1, 1990, Ms. Ferguson maintained and operated a branch office of Dosh Realty, Inc., at the Aliki Condominium located in Daytona Beach. On or about August 1, 1990, Ms. Ferguson and Carol Savage, a licensed salesperson, entered into an "Independent Contractor Agreement" whereby Ms. Savage agreed to act as a property management agent for Dosh Realty, Inc., at the Aliki Condominium. Ms. Savage's license was registered with Dosh Realty, Inc. The Independent Contractor Agreement between Ms. Ferguson and Ms. Savage specifically required that Ms. Savage set up "two rental accounts - Dosh Realty, Inc./ (condo name) - one account to be a general account for rentals, the other account to be a non-interest escrow account for security deposits." On August 1, 1990, Ms. Ferguson opened an account, number 1130222031, at Barnett Bank in Ormond Beach, Florida. Ms. Ferguson and Ms. Savage were signatories on the account. The account was not an escrow security account. Ms. Ferguson inquired of Ms. Savage about a rental escrow account for Aliki Condominium. Ms. Savage informed Ms. Ferguson that security deposits were not required or received and, therefore, no escrow account was necessary. Despite the requirement of the Independent Contractor Agreement that an escrow account be established, Ms. Ferguson did not require that Ms. Savage comply with the terms of the Independent Contractor Agreement. Between August 1, 1990, and July 20, 1991, Ms. Savage, in the course of her association with the Respondents, solicited and obtained tenants to lease condominium units at the Aliki Condominium. Ms. Savage informed Ms. Ferguson that the agreements for these rentals were verbal. Ms. Ferguson did not insist that written agreements be entered into. Between August 1, 1990, and July 20, 1991, Ms. Savage in fact received monies as security deposits for rentals at the Aliki Condominium. Not all of the monies received by Ms. Savage were deposited in an account of the Respondents. Respondents were not notified of the security deposits and the Respondents were not aware that the security deposits had been collected. On July 20, 1991, Ms. Ferguson became aware that Ms. Savage had been collecting security deposits from tenants of the Aliki Condominium. Ms. Ferguson learned that Ms. Savage had taken the deposits and had failed to deliver the deposits to the Respondents. On or about July 20, 1991, tenants of the Aliki Condominium began to demand a return of their security deposits and Ms. Savage left the State of Florida. Ms. Ferguson reported the foregoing events to the Department and ultimately filed a complaint against Ms. Savage. Ms. Savage ultimately surrendered her license with the Department for revocation. The Respondents have not returned the security deposits received by Ms. Savage at the Aliki Condominium. Although Ms. Ferguson was very cooperative during the Department's investigation of this matter and although Ms. Ferguson did inquire of Ms. Savage concerning the manner in which rentals were handled at Aliki condominium, Ms. Ferguson did not insist, as a condition for the continued use by Ms. Savage of Ms. Ferguson's brokers license and the brokers license of Dosh Realty, Inc., that Ms. Savage use written rental agreements, require deposits and use an escrow account. Ms. Ferguson acknowledged during the investigation of this matter that monies were received at Dosh Realty's branch office at the Aliki Condominium that were not deposited in an escrow account and that she accepted Ms. Savage's representation that no written leases were entered into at the Aliki Condominium.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a Final Order finding that the Respondents have violated Sections 475.25(1)(b), (d) and (k), Florida Statutes (1991). It is further RECOMMENDED that Ms. Ferguson be reprimanded, placed on probation for one year and required to complete the 30 hour broker management course. DONE and ENTERED this day of July, 1992, in Tallahassee, Florida. LARRY J. SARTIN 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 day of July, 1992. APPENDIX Case Number 92-1990 The parties have submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph number(s) in the Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted. The Department's Proposed Findings of Fact Proposed Finding Paragraph Number in Order of Fact Number of Acceptance or Reason for Rejection 1 1. 2 2. 4 3. 5 4. See 5. See 8. 8 10. See 11. The exact amount of the deposits at issue was not proved by competent substantial evidence. Hereby accepted. 11 12. 12 13-14. 14 15. 15 See 17. The Respondents' Proposed Findings of Fact Proposed Finding Paragraph Number in Order of Fact Number of Acceptance or Reason for Rejection 1 1. 2 2. 3 3. 4 4. 5 5. 6 8. 7 11. See 9-10. 8 10-11. 9 12 and 13. The last sentence is not supported by the weight of the evidence and is not relevant. Although it is true that the exact monies Ms. Savage took were not received by the Respondents, they were responsible and could have returned monies of the Respondents. COPIES FURNISHED: Steven W. Johnson Senior Attorney Department of Professional Regulation Division of Real Estate Legal Section Hurston Building, North Tower #308 400 West Robinson Street Orlando, Florida 32801-1772 R. Michael Kennedy, Esquire Post Office Box 4319 South Daytona, Florida 32121 Jack Ray General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando Florida 32802-1900
