Findings Of Fact At all times material hereto Respondent has been a licensed pilot in the State of Florida, with license number 000050, and has operated as a pilot on Tampa Bay. Respondent received his state license in 1971, and also holds a federal license to serve as: Master of freight and towing vessels of not more than 1000 gross tons upon oceans; master of uninspected motor vessels of not more than 300 gross tons upon oceans; . . . first class pilot of steam and motor vessels of any gross tons upon Tampa and Hillsborough Bays to Tampa and Port Tampa, Florida, including Alafia River. . . . Count I On January 9, 1984, Respondent served as pilot aboard the foreign registered vessel Pennsylvania Rainbow as it sailed outbound from the International Minerals and Chemical Dock. The Pennsylvania Rainbow has a gross tonnage of 13,962, is 527.3 feet long and 81.4 feet wide. During the course of his pilotage duties, Respondent made a radio transmission substantially as follows: "Security, Security--Trico 1 outbound with Trico 3 and 4." Respondent is Trico 1, and Trico 3 and 4 are other members of Tampa Tri-County Pilots Association who do not have state pilot or deputy pilot licenses and who Respondent has sought to designate as "apprentice pilots." After the initial security call by Respondent, both Trico 3 and 4 also gave security calls aboard the Pennsylvania Rainbow. These security calls were overheard by licensed pilots on Tampa Bay who were approximately 15 miles away at the time and were concerned that persons without state licenses were being allowed to pilot the Pennsylvania Rainbow since the custom on Tampa Bay is that the person handling the vessel is usually the one who makes radio transmissions. At no time did the licensed pilots who testified actually see Trico 3 or 4 piloting the vessel. The foreign registered vessel Golden Laurel sailed inbound on January 22, 1984 to the loading berth at I.S. Joseph Company in Port Tampa with Respondent as pilot and Captain Tu Ting Kuo as master. The Golden Laurel has a gross tonnage of 29,729, and is 738.1 feet long and 105.6 feet wide. Respondent was accompanied by at least one unlicensed person whom he had sought to designate as an "apprentice." The unlicensed person was allowed to give commands which Respondent would overrule if such commands were not correct. Respondent remained on the bridge at all times in the immediate vicinity of the quarter- master and did correct the orders given by the unlicensed person on several occasions. The foreign registered vessel Trade Unity was inbound to the loading berth at I.S. Joseph Company on February 20, 1984 with Respondent as pilot, accompanied by an unlicensed person. The Trade Unity has a gross tonnage of 35,897 and is 770.14 feet long and 105.3 feet wide. With the permission of the master, Respondent allowed the unlicensed person to handle the Trade Unity in order to gain experience and practice. The unlicensed person gave commands which Respondent would overrule if necessary. On four occasions in June and July, 1984, Respondent served as pilot aboard the foreign registered vessel Marcona Conveyor as it arrived at and departed from Port Tampa. The Marcona Conveyor has a gross tonnage of 32,607, is 831.2 feet long and 106.2 feet wide. According to the master of the vessel, Capt. Charles D. Paden, Respondent permitted unlicensed persons to give commands for routine maneuvers of the vessel. Respondent would stand by on the bridge and intercede if necessary. Respondent permitted unlicensed persons to practice "piloting" by giving commands for the handling of the Golden Laurel, Trade Unity and Marcona Conveyor, but he contends that he remained on the bridge at all times, "acknowledged" or approved all such commands and overruled incorrect commands when necessary. Respondent also allowed unlicensed persons to practice radio transmissions and give security calls aboard the Pennsylvania Rainbow. His practice was to obtain the permission of the ship's master before allowing unlicensed persons to practice, and to introduce the unlicensed persons, whom he referred to as "apprentices," to the master. Respondent told the masters that he was the pilot of the vessel and would remain in control, while his "apprentices" practiced, by acknowledging their commands and interceding to change their commands whenever necessary. There is no approved apprenticeship program for pilots in Florida and Respondent's "apprentices" held no form of state authorization to practice or perform piloting. Respondent's practice of allowing unlicensed persons to gain hands-on ship handling experience by making radio transmissions and giving commands added an additional person to the normal chain-of-command on these foreign vessels, thereby increasing the risk of operation by increasing the potential for problems in communication. This is particularly significant with the non- English speaking crews on these foreign ships. Count II On February 28, 1984 Respondent piloted the foreign registered vessel Atropos Island in a shift from Gardinier Wharf in the Alafia River to Gadsden Anchorage. The Atropos Island has a gross tonnage of 10,019 and is 479.14 feet long and 75.08 feet wide. At the time it left the Gardinier dock, the ship was fully ballasted but had a forward draft of only 4 to 5 feet, a midship's draft of 8 to 9 feet, and an aft draft of 13 feet 9 inches. The propeller was half out of the water, with the upper half of the hub showing. After taking on cargo the loaded draft of the ship on leaving Tampa Bay was 31 feet. The weather on the morning of February 28, 1984 was overcast with winds out of the northwest at 20 to 30 miles per hour, with gusts to 40 miles per hour. Upon his arrival at the Atropos Island, Respondent monitored the weather broadcast, classified the vessel and waited for the ship to take on maximum ballast. He ordered three tugs to assist the Atropos Island in turning around in the Gardinier turning basin. It took twenty- five minutes for the vessel to complete its turn and begin to transit the Alafia River Channel. After completing the turn the tugs were ordered to release some of their lines. The Atropos Island did not go aground in the turning basin, although the vessel was blown toward the south bank of the basin by the winds to the extent that the tug Hillsborough, with a draft of 12 to 13 feet, could not get between the Atropos Island and the bank to push the vessel away from the bank. The tugs then put additional lines up to the vessel and pulled her into the middle of the turning basin. In transiting the Alafia River Channel, Respondent used a "crabbing" maneuver and this transit took approximately 1 1/2 hours, rather than the normal time of 20 minutes, due to this maneuver, the weather conditions, and Respondent's desire to await the assistance of larger tugs which he had ordered. "Crabbing" was described as a common piloting maneuver, particularly with vessels in light condition in a narrow channel such as the Alafia River Channel which is only 200 feet wide and approximately 2.8 miles long. When crabbing a vessel proceeding westerly through a channel with the wind out of the north- northwest, one tug would be on the starboard bow, the weather side of the vessel. As the vessel's stern begins to drag down, causing the vessel to go broadside, the pilot would put the rudder left, decrease the vessel speed and back the tug. The tug then acts like a spring line to pull the vessel up into a position almost parallel to the channel, at which point the pilot would slow the vessel and order the tug to stop backing. The maneuver would be repeated each time the wind caused the vessel to go off course in the channel. The evidence presented does not support the charge that the Atropos Island was grounded several times while proceeding down the Alafia River Channel. After considering all of the evidence presented, it appears that this crabbing maneuver used by Respondent was misinterpreted by the tug captains and by those who overheard radio transmissions by Respondent, which may have been "excited" due to the bad weather and difficult conditions in the channel during this transit. Significantly, the shipping agent for the Atropos Island testified that he discussed this transit with the captain of the Atropos Island the next day, and the captain stated the vessel did not run aground at any time while Respondent was piloting the vessel. The captain must account to the vessel's owner for all damage to the vessel the next time it is in dry dock and the owner will hold the captain liable for all unreported damage. Thus, it is not likely the captain of a vessel would not report a grounding if he thought one had occurred in order to protect himself from such liability. After completing the transit of the channel, the Atropos Island arrived at the location known as "Hillsborough Cut-C" where Respondent anchored the vessel and awaited larger tugs. The larger tugs, Yvonne St. Phillip and Gloria, arrived to assist the Atropos Island in turning at Cut-C, along with the smaller tugs Hillsborough and Pasco. The wind was still out of the north- northwest and the Atropos Island was heading west into the wind, having dropped its port anchor. Respondent had ordered the Hillsborough to take a position on the port bow of the Atropos Island and had positioned the Pasco on the port stern while they awaited the larger tugs. When the larger tug Yvonne St. Phillip arrived, Respondent ordered it to relieve the Pasco and the second larger tug, Gloria, was positioned on the port bow next to the Hillsborough. The Yvonne St. Phillip was pushing on the stern and the Gloria did not immediately put a line up at the bow. With the larger tug pushing in this manner at the stern, the bow of the Atropos Island began to come around toward the Hillsborough. The captain of the Hillsborough lost track of the location of the Atropos Island's anchor chain and became concerned that the anchor chain might be underneath his tug. The Hillsborough still had a line up to the Atropos Island at the time. There is conflicting testimony whether the Hillsborough's line snapped due to its being stretched tighter and tighter during this maneuver, whether it was severed by the bow of the Atropos Island, or whether Respondent ordered the line cut on purpose in order to release the Hillsborough so it could get out of the way. There is also conflicting testimony whether the Hillsborough was thereafter pushed aground by the Atropos Island or by the Gloria's wheel-wash. The captain of the Hillsborough believes that the Atropos Island pushed him aground. It was clearly established that the Hillsborough went aground at Cut-C and began to list at a 45 degree angle causing its captain great concern for the safety of his crew, and it is also established that its line to the Atropos Island parted. This occurred while the Hillsborough was assisting the Atropos Island at Cut-C. The Pasco later pushed the Hillsborough off ground. Respondent did not file a marine casualty report for any of the events occurring on the morning of February 28, 1984. Although there were winds of up to 40 miles per hour on the morning of February 28, 1984, there was other shipping traffic in the area. The conditions were not so severe as to preclude other vessels from moving, and Respondent checked the weather conditions and fully ballasting the vessel before leaving the dock. The weather did become more severe than forecast, making the maneuvers more difficult, but Respondent reacted to the worsening conditions by slowing his transit of the channel, ordering larger tugs and anchoring for a time at Cut-C.
Recommendation Based upon the foregoing it is recommended that Petitioner enter a Final Order imposing a one month suspension and one thousand dollar fine against Respondent. DONE and ENTERED this 13th day of May, 1985 at Tallahassee, Florida. DONALD D. CONN 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 13th day of May, 1985. COPIES FURNISHED: David G. Hanlon, Esquire David C. Banker, Esquire Post Office Box 3324 Tampa, Florida 33601 J. Micheal Shea, Esquire Post Office Box 2742 Tampa, Florida 33601 W.B. Ewers, Esquire Post Office Drawer 9008 Coral Springs, Florida 33075 Fred Roche Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Salvatore A. Carpino Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
The Issue Whether the Lee County Sheriff’s Office (“LCSO” or “Respondent”) correctly determined that a vessel owned by Gary Janikula (“Petitioner”) was a “derelict vessel” or an “abandoned vessel” on the waters of the state of Florida, within the meaning of section 823.11, Florida Statutes (2020), and therefore, subject to the provisions of sections 376.15, 705.101, 705.103, and 823.11, Florida Statutes (2020).
Findings Of Fact Based on the competent substantial evidence adduced at the final hearing, and the record as a whole, the following Findings of Fact are made: Mr. Janikula is the registered owner of a 35-foot pontoon houseboat,6 registration number FL3396HP (“pontoon houseboat”), found in the public waters of Lee County, Florida. LCSO is empowered to remove, or cause to be removed, derelict vessels from Florida’s public waters. §§ 376.15(3)(a) and 823.11(3), Fla. Stat. A vessel is considered to be “derelict” if it is left, stored, or abandoned “[i]n a wrecked, junked, or substantially dismantled condition upon any public waters of Florida.” § 823.11(3), Fla. Stat. Adam Winton is a sworn law enforcement officer (“LEO”) working as a Deputy Sheriff for Respondent. Prior to joining Respondent, Deputy Winton was employed by the Florida Fish and Wildlife Conservation Commission (“Commission”). The Commission is the primary state agency responsible for derelict vessel enforcement identification and investigation. Deputy Winton received “ongoing training, as well as [law enforcement] academy training in derelict vessel investigations,” and he has been assigned to “disaster areas several times for the sole purpose of conducting derelict vessel identification.” Deputy Smith has been a LEO for 23 years. Deputy Smith has been with Respondent’s marine unit for nine years. In addition to his four-year 6 Generally, this type of pontoon boat operates with a motor on each hull. degree from Florida State University, he has completed 16 hours of derelict vessel investigation training. When a derelict vessel investigation is begun, the LEO starts by identifying the owner of the vessel and finding out the owner’s intentions for the vessel. The derelict vessel investigation then determines three things: the vessel is “wrecked;” “junked;” or “substantially dismantled.” A vessel is “wrecked when it does not have the ability to extract itself absent some mechanical assistance;” it might be sunk or grounded. A vessel is “junked” when it is substantially stripped of components, the vessel has been discarded, or it could also be sunk. A vessel is “substantially dismantled” if the vessel does not have the power to be steered, there are parts missing from the vessel, or the vessel’s integrity itself is compromised. 10 On August 16, 2020, Deputy Winton was working the marine patrol detail in the public waters of Lee County, Florida. While on that patrol, Deputy Winton observed Mr. Janikula’s pontoon houseboat in Matanzas Pass7 in Lee County, Florida. Deputy Winton observed the pontoon houseboat “listing [leaning] significantly” and the “right [starboard] hull had been compromised.” He observed the right hull did not “have an effective means of dewatering ... [and] it’s been in the state for quite some time.” Although the pontoon houseboat appeared to be floating, Deputy Winton testified the “starboard hull was in shallow water so it’s possible it was resting on the bottom.” The pontoon houseboat’s starboard hull was low in the water while the port (left) side was much higher out of the water, demonstrating the vessel’s listing. Deputy Winton also observed that the “interior cabin areas were breached and open to the elements.” Several “cabin windows and doors were 7 Matanzas Pass is within Estero Bay, Lee County, Florida. either open, broken, or missing,” allowing air, rain, or salt water into the pontoon houseboat. Further, Deputy Winton observed the pontoon houseboat did not “appear to have any sort of steering device.” He observed that although this pontoon houseboat was supposed to be equipped with two motors, the starboard motor was missing and the port motor had “damage to the cowling area [and] the bottom part was very corroded.” The port motor was “cracked in the back and everything [was] corroded on it.” Deputy Winton determined the port motor was an inoperable outboard engine. The “cables and different control mechanisms that run to where the [other] engine should be or where any sort of steering should be were broken, discarded, just hanging into the water.” As a result of all that he observed, Deputy Winton issued a Florida Uniform Boating Citation V2973718 to Mr. Janikula. In addition to including Mr. Janikula’s identification information, and the date, time, and location of the pontoon houseboat, the citation included the following description of the pontoon houseboat as “at-risk of becoming derelict.” Deputy Winton testified that this “at-risk” citation “is usually used as a sort of warning or sort of means to get somebody to fix a problem before it escalates to the point where they are issued a criminal charge for derelict vessel and a removal process is initiated.” In late November 2020, over three months after Deputy Winton issued the “at-risk” citation, Deputy Smith observed the pontoon houseboat partially submerged in Estero Bay in Lee County, Florida. Deputy Smith observed the pontoon houseboat’s pontoons under water, and the vessel was “hard aground” in three feet of water. 8 This citation contained Lee County Court Case Number 20-396456/W4 and was for an infraction which did not require a court appearance, but the payment of a fine within 30 days. This is an administrative proceeding. The undersigned was not advised of and has not relied on any action taken by the Lee County Court. Deputy Smith began an investigation of the pontoon houseboat, looking to determine if it met the criteria for a derelict vessel. Deputy Smith spoke with Mr. Janikula about the condition of his pontoon houseboat, and what his intentions were for it. In early December 2020, Deputy Smith observed the partially submerged pontoon houseboat, and again spoke with Mr. Janikula. On December 8, 2020, Deputy Smith again observed the partially submerged pontoon houseboat in Estero Bay. He saw the pontoon houseboat “was definitely in [a] wrecked condition ... sitting on the bottom. And it did not have the ability to remove itself.” The pontoon houseboat was sitting on a sandbar in two-to-three feet of water, and it was listing to the starboard side because the starboard pontoon was full of water. Deputy Smith also observed that the pontoon houseboat was missing the starboard motor and the port motor was inoperable. The cables, necessary to connect the two motors for steering, were “degraded, rotting, and laying in the water.” Deputy Smith observed the “throttle mechanism was rusted and degraded and, ... not in very good shape.” The pontoon houseboat could not move on its own. As a result of his observations, Deputy Smith located Mr. Janikula, and provided him a Florida Uniform Boating Citation, V542737. This citation included Mr. Janikula’s identification information, and the date, time, and the location of the pontoon houseboat. Additionally, the citation included the description that the pontoon houseboat was an “ABANDONED AND DERELICT VESSELS [sic].” Mr. Janikula acknowledged receipt of the derelict vessel citation and the information described in the first paragraph of the Preliminary Statement above. LCSO provided photographic evidence (Respondent’s Composite Exhibit G) of the condition of the pontoon houseboat between December 2020 and February 2021. A brief description of each photograph is provided: G-1: The front of the pontoon houseboat is listing to the starboard side, with barnacles exposed on the port hull, rub railing is broken, and port side is missing windows; G-2: The front of the pontoon houseboat is listing to the starboard side, with barnacles exposed on the front port bow; G-3: The pontoon houseboat registration number is visible, barnacles on the port side exposed pontoon above the water line are visible, rub railing is broken and coming apart, windows are broken out, and the LCSO’s Notice is visible; G-4: Starboard lower back side panel is shredded, hatch cover is missing, starboard motor is missing, throttle cables are unattached and hanging in the salt water; G-5: Starboard stern close-up of the damaged steering position, throttle cables are hanging down, starboard lower back side panel is shredded, stern back-door frame is rusted, and the back door open; G-6: Full stern view of the inoperable port side outboard motor, starboard motor is missing, starboard side steering cables laying in the salt water, and starboard lower back side panel is shredded; G-7: Navigational lights on starboard are visible, and bow appears to be a receptacle for a number of unrelated, discarded items, including a wheel and ice chest; G-8: Starboard lower back side panel is shredded, open hatches or windows are visible, port engine is out of the water, starboard motor is missing, steering cables are in the water, and pontoon houseboat is visibly listing to the starboard side; G-9: Full stern view of the inoperable port side outboard motor, starboard motor is missing, starboard side steering cables are laying in the salt water, stern back door frame is rusted and back door is open, and starboard lower back side panel is shredded; G-10: Port side pontoon is partially out of the water, rub rail is broken, windows are broken or missing, stern back door is open, port side outboard motor is out of the water, and starboard motor is missing; G-11: LCSO Notice posted on the pontoon houseboat on December 8, 2020; and G-12: Bow of the pontoon houseboat is listing to the starboard side, barnacles are exposed on the front port bow, and rub railing is broken. Mr. Janikula testified that the pontoon houseboat is “an ongoing project” of his, yet he failed to provide credible evidence of any repairs being made to it. He offered that someone was living on it and the person had a “hot shower last night.” Mr. Janikula testified that his pontoon houseboat was “currently in about 7 feet of water floating just fine. Right next to me. I can see it from here.” Mr. Janikula testified that the one outboard motor “got damaged,” his pontoon houseboat “doesn’t have any functioning engine” on it, and currently it is incapable of being moved on its own. Although he claimed the pontoon houseboat only had one motor when he purchased it, Mr. Janikula claimed the steering components were all present, and the vessel only needed one engine to steer. Lastly, Mr. Janikula testified that the pontoon houseboat was “technically ... a residential barge … it looks like a mobile home on pontoons.” LCSO’s photographs provide proof that this is not a barge as defined in section 327.02(3), Florida Statutes,9 but a pontoon houseboat, and it is in a wrecked condition. There can be no dispute that the pontoon houseboat was a “vessel” within the meaning of section 327.02(46). Based on the evidence (both testimony and photographic), the undersigned finds that at the time of the hearing, Mr. Janikula’s testimony regarding: substantial repairs having been made to the pontoon houseboat; 9 Section 327.02(3) provides: “Barge” means a vessel that does not have living quarters, is not propelled by its own power, and is designed to be pushed or pulled by another vessel. the description of the pontoon houseboat as floating in “7 feet of water”; the claim that the pontoon houseboat was sold with only one engine; and the claim that it is a residential barge, to be unpersuasive and self-serving. Further, the pontoon houseboat was a “derelict vessel” within the meaning of section 823.11(1)(b)1. It was left in a wrecked, junked, or substantially dismantled condition upon the public waters of this state. The testimony and photographic evidence conclusively demonstrate that the pontoon houseboat was a junked and/or substantially dismantled vessel when it was observed by the deputies.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Lee County Sheriff’s Office issue a final order deeming the pontoon houseboat to be a “derelict vessel” within the meaning of section 823.11, and the Lee County Sheriff’s Office is authorized under section 376.15(3)(a) to relocate or remove it. DONE AND ENTERED this 30th day of April, 2021, in Tallahassee, Leon County, Florida. S LYNNE A. QUIMBY-PENNOCK Administrative Law Judge 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of April, 2021. COPIES FURNISHED: Gary Scot Janikula 132 Tropical Shore Way Fort Myers Beach, Florida 33931 Antonette D. Hornsby, Esquire Lee County Sheriff's Office 14750 Six Mile Cypress Parkway Fort Myers, Florida 33913
Findings Of Fact Tampa Tri-County Pilots Association (TRICO) was founded January 1, 1984, by Captain Rabren to provide piloting and shifting services in Tampa Bay in competition with the Tampa Bay Pilots Association. Captains Murphy, Cropper, and Farrell are members of TRICO and hold U. S. Coast Guard issued unlimited pilots' licenses for Tampa which authorize them to pilot vessels enrolled in the coastwise trade which enter or leave Tampa Bay. Captain Rabren holds a state pilot's license for Tampa Bay in addition to his federal unlimited pilot's license for Tampa Bay. In 1984 the Chairman of the Board of Pilot Commissioners received a letter from Captain Valenti, U. S. Coast Guard, the captain of the Port of Tampa, calling attention to the Board that certain pilots within Tampa Bay were asserting that neither the State of Florida nor the Coast Guard had jurisdiction over shifting activities of foreign flag vessels. Vessels engaged in the coastwise trade (which generally must be built in the United States and carry the U. S. flag) are piloted, while in waters requiring a pilot, by a U. S. Coast Guard licensed pilot for those waters; and a foreign flag vessel on similar waters is piloted by a state pilot licensed for those waters. Since state licensed pilots also provide piloting services for U. S. flag vessels, all of the state licensed pilots also hold federal pilot licenses. The only pilots that could claim neither the state nor federal government had jurisdiction over their activities were those pilots holding only federal licenses who were piloting foreign flag vessels while being shifted within Tampa Bay. Within Tampa Bay there are four separate and distinct ports as well as several anchorages to which vessels are taken from these ports and from which vessels are taken to these ports. Additionally, vessels are shifted from port to port within Tampa Bay. The distance vessels are shifted within Tampa Bay varies from a few feet alongside the dock to more than 20 miles a vessel would travel from a berth in upper Tampa Bay to the Port of St. Petersburg. Having a tug alongside a ship for a short move of less than one mile is prudent and, perhaps, necessary. However, for a longer trip a tug alongside is unnecessary, dangerous (to the tug) and an unnecessary and unwarranted expense to the ship owner. Prior to the adoption of Rule 21SS-8.10, Florida Administrative Code, members of TRICO performed piloting services on both United States and foreign flag vessels shifting moorings within Tampa Bay. Since its formation TRICO has been in competition with the Tampa Bay Pilots Association to obtain exclusive contracts with shipping companies to perform piloting services on the company vessels while the vessels are shifted to different moorings in Tampa Bay. Upon Rule 21SS-8.10 becoming effective, TRICO members, not holding a state pilot's License, are precluded from shifting foreign flag vessels between moorings in Tampa Bay except when in the docking mode.
The Issue Whether Petitioner’s transactions regarding capital purchases and improvements, gift shop lease payments, concessionaire revenues, purported office lease payments, and 11 gaming equipment (leased and purchased) are subject to Florida sales or use tax during the audit period and whether Petitioner is entitled to the resale exemption for food purchased and provided to its customers during the audit period. Finding of Fact 46 During the audit period, the Petitioner sold tickets to its cruises generally for $25 (most cruises) and $30 (weekend, evening, and Sunday brunch cruises). In general, the cost of its food during the audit period was $7.50 per passenger. It is undisputed that the petitioner did not pay sales tax on the food it purchased for later consumption by its passengers. Finding of Fact 92 During the audit period Mr. Genden requested, but could not receive, records pertaining to register tapes and ship documents that would show how and when the registers were opened and closed, and ship policies concerning when registers were opened and closed. The requested records had been destroyed by the inadvertent activation of the Vessel’s sprinkler system. The Recommended Order, subject to the modifications stated above, is adopted and attached below. 12 DONE AND ENTERED in Tallahassee, Leon County, Florida this_ 244 day of November, 2001 STATE OF FLORIDA DEPARTMENT OF REVENUE < Zingge xecutive Direct, Certificate of Filing J HEREBY CERTIFY that the foregoing FINAL ORDER has been filed in the official records of the Department of Revenue this day of 1 nueeben >, 2001. wit : 4 Al FENCY CLERK Copies furnished to: Kenneth M. Hart, Esquire Nicole M. Nugan, Esquire Gunster, Yoakley & Stewart, P.A. 777 South Flagler Drive, Suite 500, East Tower, West Palm Beach, Florida 33401 William L. Hyde, Esquire Gunster, Yoakley & Stewart, P.A, 215 South Monroe Street, Suite 830 Tallahassee, Florida 32301 13
Conclusions This cause came before the Department of Revenue for the purpose of issuing a final order. The Administrative Law Judge assigned by the Division of Administrative Hearings issued a Recommended Order, sustaining the Department’s assessment. A copy of the Recommended Order is attached to this Final Order. Petitioner timely filed exceptions to the Recommended Order and a copy of that filing is attached to this Final Order. For the reasons expressed herein, the Department adopts the Administrative Law Judge recommendations and specifically incorporates the Recommended Order except for Finding of Facts 46 and 92, which are modified as reflected below. Rulings on Petitioner’s exceptions are also set forth below. Petitioner’s Exception to Finding of Fact 17 Petitioner asserts that it is a misrepresentation that its ship, the Palm Beach Princess (the Vessel), travels “just far enough” to engage in gambling activities without violating state laws. Petitioner further avers that its Captain, Hrovj Michl, testified that the Vessel “travels into international waters on each of its cruises.” The Record clearly indicates that the Vessel travels exactly three miles out from port on each of its cruises-to-nowhere, whereupon gambling activities commence for a period lasting until preparations are made for the Vessel’s return to port. During gambling activities the Captain stems the tide at a point three miles off shore, which is exactly beyond the extent of Florida’s territorial waters. As per Presidential Proclamation No. 5928, Dec. 24, 1988, the Territorial Limits of the United States extend 12 miles from shore, whereupon international waters commence. Therefore, based upon testimony provided by Petitioner’s own witness, the Vessel travels just far enough to leave Florida’s territorial waters, but remains 9 miles inside of the territorial limits of the United States. Petitioner, at the hearing or in its exceptions, provides no contrary authority that expressly contradicts Presidential Proclamation 5928. As such, the Administrative Law Judge’s finding stands. Petitioner’s exception to Finding of Fact 17 is hereby rejected. Petitioner’s Exception to Finding of Fact 39 Petitioner asserts that it misstates the facts to find that “[t]he sole source of the Petitioner’s income during the audit period was in connection with business conducted in the U.S.” The Petitioner further claims that “Section 863(c) of the Internal Revenue Code contains a per se rule that treats [Petitioner’s] transportation income as derived from sources within the United States" even when Petitioner was engaged in foreign commerce. Petitioner deems that “compliance with an income source tule in the Internal Revenue Code [should not be] determinative of whether [Petitioner] is engaged in foreign commerce. The Record clearly indicates that Petitioner’s federal tax returns show income derived from a business conducted in the United States. The Record also indicates that Petitioner maintained an office located within the State of Florida, it exclusively operated its Vessel from a port within the State of Florida, and, as discussed in the preceding Exception, its Vessel never traveled into international waters or the territorial waters of any other state. With no connection to any other taxing authority within the United States and with no evidence of commerce conducted with a foreign entity, Petitioner's argument must fail as it concerns this Finding of Fact. Petitioner’s exception to Finding of Fact 39 is hereby rejected. Petitioner’s Exception to Finding of Fact 41 Petitioner asserts that its Vessel is engaged in foreign commerce because the Vessel travels, with passengers aboard, to a point slightly more that 3 miles off the coast of Florida. Section 1331 of Title 43 of the United States Code state that the “territorial sea of the United States henceforth extends to 12 nautical miles from the baselines of the United States determined in accordance with international law.” Because Petitioner’s Vessel travels only 3 miles offshore, the Vessel never reaches international waters. Additionally, to be engaged in commerce in the manner in which the Petitioner contends it occurs, Petitioner needs to “transport” passengers or property from one point to another. The Record clearly indicates the Vessel leaves from port and returns to the same port with no intervening stops. Thus, Petitioner’s claim fails on this point as well. Petitioner’s exception to Finding of Fact 41 is hereby rejected. Petitioner’s Exception to Finding of Facts 86, 90, and 99 Petitioner excepts to the finding “that at all times material to the audit period, [Petitioner] maintained an office in Boca Raton, Florida.” Petitioner further avers that payments for the office space were in the form of “advances for payments due under a management agreement between [Petitioner] and [its management company].” These contentions are without merit as the Record is replete with sufficient, competent documentary evidence substantiating the existence of Petitioner’s Boca Raton office and the manner in which rent payments were made is immaterial to that finding. Petitioner’s exceptions to Finding of Facts 86, 90, and 99 are hereby rejected. Petitioner's Exception to Finding of Facts 87 and 89 Petitioner excepts to the findings that sales tax is due on photography and gift shop licenses and on its lease of gambling equipment. Petitioner bases its entitlement to an exemption on the claim that all of its resulting income “is attributable to the transportation of persons or property in foreign commerce under § 212.08, Florida Statutes... .” As discussed in Petitioner’s Exception to Finding of Fact 41, Petitioner does not engage in foreign commerce as described in under § 212.08, Florida Statutes, therefore Petitioner’s argument on these points fails. Petitioner’s exceptions to Finding of Facts 87 and 89 are hereby rejected. Petitioner’s Exception to Finding of Fact 88 Petitioner claims it is entitled to an exemption for the cost of food used in preparing the buffet meal served on its Vessel. In support of this contention, Petitioner points to Finding of Fact 46, which states: “[I]t is undisputed that the Petitioner did not pay sales tax on the food it purchased for resale to its passengers.” This claimed exemption would be properly granted if Petitioner’s purchase of food was indeed for “resale.” The Record, however, clearly shows that admission to Petitioner’s Vessel comes in the form of a lump-sum charge, which entitles patrons to all amenities offered on board the Vessel to include food, gambling, and other related services. The Administrative Law Judge in Paragraphs 44 and 45 of her Recommended Order discusses these facts. Since the Petitioner is providing a taxable admission, and since the cost of all goods and services, including meals, is included with that admission, Petitioner can not claim in this instance to be providing food for resale. Petitioner’s exception to Finding of Fact 88 is hereby rejected and Finding of Fact 46 is modified to accurately portray the character of Petitioner’s food purchase. Petitioner’s Exception to Finding of Fact 92 Finding of Fact 92 reads that the Department requested, but did not receive, certain records during the conduct of the Department’s audit. Petitioner, in its exception, acknowledges that the records were not provided, but adds that the requested records had been inadvertently destroyed by the ship’s water sprinkler system. Although the Finding of Fact makes no allegation of inappropriate or non-compliant behavior on the part of the Petitioner, there exists sufficient evidence in the Record detailing Petitioner’s cooperation during the audit process to warrant modification of this Finding of Fact. Petitioner’s exception to Finding of Fact 92 is hereby accepted in part and the Finding of Fact will be modified to reflect the reason for Petitioner’s non-production of tecords. Petitioner’s Exception to Finding of Facts 93 - 97 Petitioner’s objections to the Findings in Paragraphs 93 — 97 revolve around the contention that if one were to concede that the Vessel “‘stems the tide” on its cruises to nowhere [this could be] fundamentally inconsistent with the conclusion that the [Vessel] travels 34 miles during such voyages.” Petitioner avers that the Administrative Law Judge failed to consider contrary testimony and appears to have given substantial weight to the fact that Petitioner did not contest mileage figures until the time of the hearing. Petitioner also objects that “the determination of the mil[eJage traveled on a cruise to nowhere in this case should not have been based on determinations made prior to the instant proceeding, but should have been based solely upon the evidence in the record.” During testimony at his deposition and again while testifying at trial, Petitioner’s witness, Captain Hrvoj Michl, consistently confirmed the accuracy of the voyage reports offered into evidence at the hearing. These records clearly support the Department’s reliance upon the figure used to calculate portions of the assessment at issue and are at variance with the mileage proffered by the Petitioner in its Exceptions. The voyage reports clearly and consistently document that the Vessel traveled in excess of 30 miles on each of its cruises-to-nowhere. Petitioner’s exceptions to Finding of Facts 93 — 97 are hereby rejected. Petitioner’s Exception to Finding of Fact 93 Petitioner specifically objects the finding that the Department’s auditor relied on a mileage figure he received from on of the Petitioner’s ship captains during a telephone conference call arranged by Petitioner’s vice president. Petitioner, however, failed to produce the vice president [who was the only other participant in this conversation] at the hearing to contest the auditor’s claim. Additionally, as discussed in the preceding paragraph, there exists substantial evidence in the Record supporting the veracity of the auditor’s claim and his subsequent reliance on the mileage figure. Petitioner’s exception to Finding of Fact 93 is hereby rejected. Petitioner’s Exception to Finding of Fact 94 Petitioner specifically claims that there is nothing in the Record to substantiate that “records associated with the mileage issue were not reviewed further because the auditor did not realize the figure would be later disputed.” As recorded on Pages 48 and 49 of the hearing transcript, the department’s auditor testified that he first heard of the mileage figure during a meeting with one of the Petitioner’s executives. The auditor added that he subsequently viewed voyage records, prepared by the Petitioner’s captain, which supported this figure. Also, in answer to a direct question, the auditor testified that none of Petitioner’s employees disputed this figure while the audit work was being performed. These finding are consistent with the department’s tax conferee’s recollection, found on Pages 78 — 79, that no one from the Petitioner’s company raised an issue as to the mileage figure used. Based upon this testimony alone, there is substantial evidence supporting the Administrative Law Judge’s finding on this issue. Petitioner’s exception to Finding of Fact 94 is hereby rejected. Petitioner’s Exception to Finding of Fact 96 Petitioner, once again, excepts to the finding regarding the mileage figure produced at the Hearing. As previously discussed, the Administrative Law Judge correctly based this finding on figures produced by the Petitioner in Petitioner’s Voyage Report, and the accuracy of this report was verified by Petitioner’s witness under sworn testimony. Petitioner’s exception to Finding of Fact 96 is hereby rejected. Petitioner’s Exception to Finding of Facts 97 and 98 In addition to other exceptions already presented and analyzed in this Final Order, Petitioner argues that it “did not become aware of the DOR auditor’s erroneous conclusion regarding the correct travel distance of each voyage until the discovery process in the DOAH hearing.” In a Joint Pre-Hearing Stipulation files by the parties, it was agreed that the Department of Revenue issued a Notice of Proposed Assessment in this matter on March 12, 1999. The Department also issued a Notice of Decision pertaining to the assessment on June 12, 2000. The assessed amounts were based on the 34-mile figure in both instances, and both events preceded the complaint that initiated this DOAH proceeding. As evidenced by the information presented at the Hearing, evidence that verified the auditor’s use of the mileage figure, there exists sufficient documentation to support the Administrative Law Judge’s Finding of Fact. Petitioner’s exception to Finding of Facts 97 and 98 are hereby rejected. Petitioner’s Exception to Conclusion of Law 101 Petitioner argues that it has met its burden in proving that the assessment is incorrect. For reasons set forth in the Department’s responses to Petitioner’s Exceptions, and based upon the findings in the Administrative Law Judge’s Recommended Order, it is determined that there is ample documented evidence in this Record to refute Petitioner’s claim. Petitioner’s exception to Conclusion of Law 101 is hereby rejected. Petitioner’s Exceptions to Conclusion of Law 116 and 118 Petitioner iterates the exceptions that were discussed in its Exceptions to Finding of Facts 17, 41, 87, and 89. The analysis previously provided supports the Administrative Law Judge’s findings in these instances as well. Petitioner’s exceptions to Conclusions of Law 116 and 118 are hereby rejected. Petitioner’s Exceptions to Conclusions of Law 120, 123, 124, 129 and 132 Petitioner excepts to the conclusion that it exercised control over tangible personal property in Florida and it restates its claim that certain assessed items were non- taxable because of their use “in the stream of foreign commerce.” For reasons cited earlier, Petitioner’s claim of engaging in foreign comrnerce while conducting cruises-to-nowhere is rejected. The Record also contains substantial documented evidence to support the Department’s contention that Petitioner exercised control over tangible personal property while the Vessel was docked in Florida. Also, in recognition of this country’s 12-mile territorial limit, Petitioner’s claim for proration of the miles traveled beyond Florida’s 3-mile is deemed inappropriate as it misidentifies the starting point of international waters. Petitioner’s exception to Conclusions of Law 120, 123, 124, 129 and 132 are hereby rejected. Petitioner’s Exceptions to Conclusions of Law 126 and 127 Petitioner’s claim of entitlement to a resale food exemption is based on the proposition that the meal consumed by its passengers is “an essential element of the entertainment package purchased....” The Administrative Law Judge, having toured the ship, and having been briefed by both parties as to the applicable case law on this subject, considered this argument and rejected it. In review, the evidence supports this determination. Petitioner’s exceptions to Conclusion of Law 126 and 127 are hereby rejected. Petitioner’s Exceptions to Conclusions of Law 131 Petitioner reargues its contention that it did not lease or rent office space in Florida and it adds, that if it were deemed to have rented office space, “[it] is entitled to 10 credit for the sales tax [that] has already been paid....” As previously discussed, the Administrative Law Judge made her findings of fact and conclusions of law based upon competent and substantial evidence. In this conclusion, the Administrative Law Judge states, “[t]he Petitioner is responsible for the sales tax that was not paid during the period of its occupancy of the real property....” (Emphasis supplied) The matter of whether Petitioner is, or is not, entitled to a credit is not at issue, nor is there any finding or conclusion that would prevent Petitioner from seeking a refund or credit through proper legal means. As such, Petitioner’s exception falls outside the scope of this Conclusion. Petitioner’s exception to Conclusion of Law 131 is hereby rejected. Adoption and Modification of the Recommended Order The Statement of the Issues is modified as set forth below to more accurately reflect the issues addressed by the Administrative Law Judge. The Preliminary Statement as set forth in the Administrative Law Judge’s Recommended Order is adopted in its entirety. The Department adopts and incorporates the Findings of Fact set forth in paragraphs 1 through 45, 47 through 91, and 93 through 99 of the Recommended Order. Findings of Fact 46 and 92 are modified as presented below. The Department also adopts and incorporates Conclusions of Law set forth in paragraphs 100 through 132 of the Recommended Order.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following facts are found: Respondent, Thomas A. Baggett has been licensed by the State of Florida as a pilot in Tampa Bay for fifteen (15) years and at all times pertinent to this proceeding was licensed by the State of Florida as a pilot. On February 5, 1984, at about 0620 hours, while Captain Baggett was piloting M/V Triton C outbound from the Gardinier Wharf in Hillsborough County, Florida, the M/V Triton C ran aground outside the prescribed limits of CUT D in Tampa Bay on the east side. The M/V Triton C is a Liberian bulk carrier with an approximate length and width of 576.7 feet and 81 feet, respectively, with a gross tonnage of 17,823 tons. At the time of grounding, the M/V Triton C had a forward draft of 29 feet, 11 inches and an aft draft of 30 feet and 1 inch. The M/V Triton C was experiencing no engine or navigational equipment problem before it ran aground. All aids to navigation, including ranges and buoys, were in place and working properly at the time of the grounding. The M/V Triton was travelling at a speed of 11.7 knots. Range lights, when properly aligned, provide a way for the pilot or anyone navigating a vessel to know the vessel is in the center of the channel. On the morning of February 5, 1985, shortly before the grounding of the M/V Triton C, Captain Baggett gave orders for the turn from CUT E into CUT D, or from a heading of 198 degrees to a heading of 213 degrees. Captain Baggett ordered the wheel 20 degrees to starboard and then eased to 10 degrees. Captain Baggett then ordered the quartermaster to midship the wheel and steady the vessel on 213 degrees. He gave no instructions to the quartermaster concerning the use of the range lights for navigating the center of the channel. At this point the confusion begins. Captain Baggett testified that the M/V Triton C steadied up on 213 degrees, an appropriate course for the transit of CUT D, while he was present and he observed the M/V Triton C as being on the ranges for about 2 minutes before going into the chart room. As he stepped back into the chart room, he glanced at the compass and observed that the vessel was on a heading of 213 degrees. Captain Baggett gave no further instructions or orders other than "hard to starboard" when he came out of the chart room 15-20 seconds later and noticed the bow swinging to port, the rudder indicator showing 20 degrees rudder and the ranges being already opened. Captain Baggett testified that upon giving the order "hard to starboard" the quartermaster pulled the wheel and went "hard to port" and the vessel almost immediately went aground. The mate and quartermaster tell a different story. The master was below and not present on the bridge at the time of grounding. The mate testified that Captain Baggett went into the chart room while the compass was swinging through 210 degrees and before the vessel steadied up on 213 degrees, and that Captain Baggett remained in the chart room for 40 seconds to 1 minute and came out as the vessel went aground. The quartermaster testified that Captain Baggett went into the chart room immediately upon the vessel steadying up on 213 degrees, and did not stay to watch the course or range for 2 minutes. He further testified that Captain Baggett was in the chart room for 5-6 minutes; that he came out of the chart room as the vessel went aground; and, Captain Baggett gave no order of "hard to starboard". The quartermaster at the time of the grounding was Maheswaran Gnanasundran and the mate was Siburs Ioannas. As evidenced by the depositions, both were foreign; neither spoke English and each required an interpreter at the deposition. The master of the M/V Triton C on the day of grounding was Stamatios Stanou, a citizen of Greece, and required an interpreter for his deposition. Captain Baggett experienced a communication problem with quartermaster Gnanasundran in the beginning of the turn out of CUT E to CUT D, and earlier with another quartermaster at the beginning of the turn out of Hilisborough A CUT into Hillsborougn C CUT who was on duty just prior to quartermaster Gnanasundran. The M/V Triton C was at a heading of 206 degrees immediately after grounding and did not move significantly from that heading while grounded. Both the mate and the quartermaster testified that the M/V Triton C, after steadying up, stayed on the course heading of 213 degrees during the entire time and was on the same course heading when the vessel went aground. The mate testified that as the M/V Triton C began to run aground it began to list to the right, and its heading as it finally came to rest aground was 206 degrees. The master of the M/V Triton C testified that the wind was out of the northwest at 15 knots, with full tide, and the current being with M/V Triton C at about 2 knots. Captain John C. Hanson, an investigator for petitioner, testified that at the time of grounding, based on tidal information and weather reports, the wind was out of the northwest and there was an ebb tide running in a southerly direction which would tend to set the M/V Triton C in a southerly direction to the east of CUT D. Captain Hanson further testified that these conditions would have an effect on navigation. Captain Baggett testified that there was an ebb tide in a southwest direction and that it would tend to set to the southwest but at that point in time, it would have had very little effect on the M/V Triton C. Therefore, he did not make any allowances for the tide, wind, or a combination of them. Petitioner's Exhibit No. 3 shows the mean lower low water depth outside of the confines of the channel in the area of grounding to be 24 feet to 25 feet. Captain Hanson testified that the chart was current but that the depth of the water in a Particular area could be deeper, depending upon tides and winds. Captain Baggett testified that soundings taken on February 5, 1985, during the morning of grounding, put the depth of the water at the bow (point of grounding) and stern to be 25 feet and 37 feet, respectively and, that he visually observed, after daylight the stern of the vessel as being located in the ship channel of CUT D. The ship channel in CUT D has an approximate width of 400 feet with shoaling on both sides. Captain Hanson boarded the M/V Triton C 3 days after the grounding and testified that he plotted the position where the vessel went aground by taking "crossbearings of fixed structures, (no floating aids) and one radar range to one of the radar structures." Captain Hanson plotted the position of the M/V Triton C to be on the east side of CUT D, at a point 450 feet from the centerline of the CUT D approximately 1325 yards from a midpoint between buoys 1E and 2E. For an exact position see Petitioner's Exhibit No. 3. The crossbearings used to locate the exact position of the M/V Triton C are shown on the chart on the right side of Petitioner's Exhibit No. 3. The left side of Petitioner's Exhibit No. 3 is an enlargement of CUT D prepared by Captain Hanson showing the various courses the M/V Triton C could have taken from a point abeam of buoys 1E and 2E to the position of grounding based on the speed of the M/V Triton C at 11.7 knots. Petitioner's Exhibit No. 3 demonstrates that if the point of grounding was 450 feet from the centerline of the channel, as Captain Hanson testified, and, the M/V Triton C grounded on the heading of 206 degrees, then, at that heading, the stern of a vessel 576.7 feet long could not have reached the channel. Captain Hanson's testimony concerning his method of locating the position of the M/V Triton C, the crossbearing used and the calculations went unrebutted. With a vessel drafting 29 feet 11 inches forward and the point of grounding being 450 feet from the centerline of the channel, the depth of the water outside the confines of the channel along the heading taken by the M/V Triton C was deeper than 25 feet or the grounding would have occurred sooner and at a point closer to the east bank of CUT D. As Petitioner's Exhibit No. 3 demonstrates, the testimony of the quartermaster that the M/V Triton C steadied up on 213 degrees after making the turn from CUT E to CUT D and steered that course for five to six minutes while Captain Baggett was in the chart room is incorrect as to how long Captain Baggett was in the chart room, because the vessel would have travelled beyond the point of grounding in 5 to 6 minutes. As Petitioner's Exhibit No. 3 demonstrates, the testimony of the mate that Captain Baggett went into the chart room while the compass was swinging through 210 degrees and before the vessel steadied up on 213 degrees and that the vessel went aground within 40 seconds to 1 minute while Captain Baggett was still in the chart room is incorrect as to how long Captain Baggett was in the chart room because the vessel could not have travelled to the point of grounding in 40 seconds to 1 minute from the time it made the turn out of CUT E into CUT D. As Petitioner's Exhibit No. 3 demonstrates, the testimony of Captain Baggett that the vessel steadied up on a heading of 213 degrees in the center of CUT D and that he viewed the ranges in line for 2 minutes before going to the chart room and that "almost immediately" upon coming out of the chart room 15 to 20 seconds later the vessel went aground was incorrect as to how long he stayed after the vessel steadied up before going into the chart room because in that time frame the turn, causing the vessel to go aground would have been so sharp the vessel would have gone aground at a heading significantly less than 206 degrees. The most believable evidence demonstrates that Captain Baggett was in the chart room 2-3 minutes prior to grounding. Captain Baggett went into the chart room to make his time and distance calculations because light was more readily available. Captain Baggett could have made the time and distance calculations without going into the chart room. While Captain Baggett was in the chart room, he was facing away from the chart room entrance and did not look at the rudder indicator, the ranges, or otherwise determine if his orders were being properly carried out. Captain Baggett's expertise as a pilot was available to the mate and quartermaster while he was in the chart room had either of them been aware of a problem and requested his assistance. But, his expertise as a pilot was not totally available to the vessel due to his position in the chart room. Where the crew is unfamiliar with the harbor and its lights and there is a language problem, courses are usually given on compass rather than instructions on the range lights.
Findings Of Fact The applicant proposes to construct a concrete boat ramp on the south bank of the Eau Gallie River in Brevard County. The Eau Gallie River is a tributary of the Indian River and is a Class III water body as defined in Chapter 17-3, Florida Administrative Code (F.A.C.). 1/ The ramp would be 17 feet wide and 64 feet long. Approximately half the length would extend into waters of the Eau Gallie River over which DER has. Jurisdiction under Chapters 403 and 253, F.S. The construction would involve the removal of 47 cubic yards of soft bottom material waterward of ordinary high water and the filling of 35 cubic yards of compacted material also waterward of ordinary high water. In addition, 38 cubic yards would be excavated landward and 72 cubic yards would be filled landward of ordinary high water. The boat ramp is to be a private facility not once to the general public. The applicant sought this permit in conjunction with the upland development of its river front property. The applicant's property extends for approximately one-half mile along the north bank of the Eau Gallie River. At build out, the applicant estimates that the property will contain several hundred apartment units which may eventually be converted to condominiums. The lessees or condominium owners would have access to the proposed boat ramp. Petitioner, Tom Hall, is an adjacent property owner who is concerned that increased boat traffic on the Eau Gallie River in the vicinity of the boat ramp would adversely impact manatee and other wildlife and marine resources. At various times of the year, manatees can be observed in the Eau Gallie River in the vicinity of the proposed boat ramp. The river also contains a variety of fish and supports a local population of water fowl. The river in the vicinity of the proposed boat ramp is generally not more than one to two feet in depth. The boat ramp is designed to launch only small craft such as canoes, rowboat or jonboats with small trolling motors. The application does not request the issuance of a permit to dredge a navigational channel to enable the beat ramp to accommodate larger power craft. The testimony of DER's expert witness established that the small craft which could be launched from the boat ramp would not pose a threat to the manatees that frequent the area. Rather, it is the larger power boats that endanger this marine mammal. There are no other wildlife or marine resources which would be impacted significantly by the construction of the boat ramp. Additionally, it should be noted that this project would benefit the several hundred residents of Brevard County who would eventually have access to the boat ramp. The testimony of DER's expert witness established that there would be no long-term violations of DER water quality standards as a result of the construction and use of the boat ramp. Short-term impact during construction would be minimal since turbidity screens are to be employed. Thus, the applicant has provided reasonable assurance that the short-term and long-term effects of the construction and use of the boat ramp will not result in violation of DER's water standards. It is important to note that, as long as no dredging of filling is involved, there is no legal impediment preventing riparian landowners from launching boats from their river front property or engaging in recreational boating activities in the portion of the boat ramp could cause continuous turbidity problems and damage valuable habitat along the river front. By confining the alteration of the littoral zone to such a small area as that involved in the application and thus guaranteeing adequate, comfortable access for the riparian owner, the survivability of the remaining littoral in its natural state would be significantly enhanced. Petitioner Hall theorizes that boats who would otherwise use downstream public boat ramps will instead launch at the site of the proposed ramp. However, there was no evidence submitted to support this theory. Given the ease with which small boats could be launched without any ramp at this site, it does not appear that the ramp itself would generate additional activity involving canoes and other small craft. Since the launching of power boats is not feasible because of the shallow river depth, such traffic is not likely to be affected by construction of the proposed ramp.
Findings Of Fact The claim imposed by the Department of Revenue stems from an audit conducted by Mr. George Thomas Lloyd, Jr., an employee of the Department of Revenue. Mr. Lloyd examined the books of the corporation and the receipts for items purchased and compiled a ledger of particular items which, in Mr. Lloyd's opinion, were not parts of the ship and upon which a use tax was due. At the hearing on this case this ledger was introduced as Joint Exhibit No. 1. It is a composite exhibit consisting of 157 pages. This ledger reflects purchases in the amount of $1,953,426.13 upon which the Department of Revenue claims tax is due. The total tax claimed by the Department of Revenue is $72,630.19 for taxes, penalties, and interest through February 16, 1976. The Petitioner is a Norwegian corporation with principal offices located in Oslo, Norway, and an office in Miami at Biscayne Boulevard. Petitioner owns three cruise vessels of Norwegian ownership and registration which sail out of the port of Miami, Florida to ports in the Caribbean. These cruises last several days. The parties have agreed that the Petitioner is in the exclusive business of transporting passengers and goods in foreign commerce. Mr. Lloyd, who conducted the audit above mentioned, testified that he prepared Joint Exhibit No. 1 by evaluating the items described in the corporation's records and used his own independent judgment in a determination as to whether those items were, or were not, parts of a vessel. If he determined they in fact were not parts of the vessel, he concluded that a use tax was owed to the State on the purchase price of those items. Mr. Lloyd stated that his determination as to whether a particular item was indeed a part of a ship was based on his independent judgment which was largely a question of whether the item was physically attached to the vessel. The individual items are far too numerous to describe in any detail herein, but they range from napkins, stirrers, postage meters, paper products, grinding wheels, coffee pots, towels, party favors, games, sandpaper, repairs to a shotgun, movie rentals, hardware items, batteries, flowers, bug spray. The items in question were delivered to Petitioner's warehouse on Dodge Island, Miami, Florida for lading on board one of Petitioner's three cruise vessels. The cruise vessels tie up next to the warehouse where the goods are stored and from time to time these goods are brought aboard each of the vessels. The items in question are all used aboard each vessel during the vessels' passenger cruises. The only time the cruise vessels spend within the territorial limits of Florida are for a period of time on Saturday of each week for the purpose of embarking and disembarking passengers for each weekly cruise. These articles, somewhat above described, are all used in connection with the ship's operation which is the conduct of weekly pleasure cruises from Miami to the Caribbean. The question of whether a particular item is a part of a vessel is one of definition and common sense. The auditor, Mr. Lloyd, appeared to accept a definition similar to what one would use in determining whether or not an item was a fixture in regard to realty. However, there are all types of vessels and it appears to this Hearing Officer that what may be a part of one type of vessel would have no function on another. There is really no relationship between what may be considered a part of real estate and what may be considered a part of a ship. There also appears to be no logic behind a definition which limits "parts of a ship" to those items which are physically attached to the vessel. Most would agree that pumps are parts of a ship; even though they may not be attached and can be easily removed, they are necessary in keeping a vessel afloat. Similarly, a compass and other navigational equipment may be removed, but that would hardly make them any less a part of a ship. As the Petitioner points out in its Memorandum, the most logical approach to a finding as what is truly a part of a vessel must ultimately hinge on the nature of the vessel, and a broad definition of seaworthiness. What are clearly parts of some ships have no purpose on others. A cargo freighter would need hoists and cranes which are not required on a tug. Each type of vessel uses equipment suited to that ship's purpose and type of cargo. While a tanker may be in the business of transporting oil, a very specialized cargo, a cruise ship is in business of transporting people and catering to their needs and entertainment. Therefore the equipment of a cruise ship would appear more frivolous to those accustomed to ships transporting basic raw materials. Both vessels, however, are in the shipping business. Since the parts of a ship must be defined as those items which serve a useful purpose to the operation of the ship, the decision then depends not on the nature of the item, but of the vessel. An oil tanker might conceivably have equipment or parts which are so specialized that they could serve no other useful purpose except aboard that type of vessel. The cruise ships in question in this case, however, use equipment which are apparently commonplace and equally useful on land as on sea. What items may properly be considered parts of a cruise ship depend on how those items relate to the operation of the vessel. While the equipment of an oil tanker would hardly be expected to be directed toward mirth; likewise, it is unreasonable for the equipment of a cruise ship to be limited to the bare necessities of a spartan voyage. As the testimony on behalf of Petitioner indicated, all the items listed on Joint Exhibit No. 1 do serve a purpose aboard the vessel and all items were purchased for use aboard the company's three vessels. It is therefore concluded that all the items listed on that schedule are in fact parts of the vessels owned by the Petitioner. The Petitioner has raised several other issues in its defense to tax assessment of the Department of Revenue. Among other things the Petitioner claims that the items in question are not stored for use in Florida. The facts above indicated that the items were purchased by the corporation and no sales or use tax has yet been paid upon them. The items are stored at the Dodge Island Warehouse owned by the Petitioner and are from time to time placed aboard vessels operated by the Petitioner corporation. From the facts presented at this hearing, the ships only spend several hours in the port of Miami each Saturday of every week. The items, therefore, are principally used while the vessels in question are on the high seas or in foreign ports. Except for this period of time on each Saturday when the vessels are in port, these items are used while the vessels are in engaged in foreign commerce.
Recommendation For reasons that the items in question are parts of the vessels and that they are used and consumed outside the state of Florida the tax assessed by the Department of Revenue should be disallowed. ENTERED this 20th day of October, 1976, in Tallahassee, Florida. KENNETH G. OERTEL, Director Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Daniel G. LaPorte, Esquire 150 Southeast Second Avenue Miami, Florida 33131 E. Wilson Crump II, Esquire Assistant Attorney General Department of Legal Affairs Tax Division, Northwood Mall Tallahassee, Florida 32303 Ed Straughn, Executive Director Department of Revenue Carlton Building Tallahassee, Florida 32304 ================================================================= AGENCY FINAL ORDER ================================================================= STATE OF FLORIDA DEPARTMENT OF REVENUE KLOSTERS REDERI A/S, d/b/a NORWEGIAN CARIBBEAN LINES, Petitioner, vs. CASE NO. 76-428 DEPARTMENT OF REVENUE OF THE STATE OF FLORIDA, Respondent. /
The Issue The issue is whether Mr. Hill, as a certified general contractor, is guilty of gross negligence or misconduct in the practice of contracting, and of failing to discharge his supervisory duty as a qualifying agent by qualifying the firm Gulfstream Shutter and Improvement Corp. when he was not actively involved in the operation of that firm, but merely obtained permits for the firm's work.
Findings Of Fact Robert C. Hill is a certified general contractor and holds license CG C028519. Mr. Hill had been hired as one of four or five salesmen for Gulfstream Shutter and Improvement Corp. by its owner, Eugene Weiner. That company sold rolldown, accordion, panel, and awning metal shutters. Gulfstream acted as a procuring agent for Seaview Manufacturing, Inc., which fabricated and installed the shutters. A homeowner who wanted shutters would contact a salesman for Gulfstream Shutter and Improvement Corp. The salesman would measure the area to be covered for the purpose of estimating a price and give the homeowner a price. If the price was accepted, the shutters would be ordered from Seaview Manufacturing through a purchase order. Engineers from Seaview would then visit the property again to take exact measurements for fabrication, and Seaview would install the shutters. After the homeowner accepted the installation, the homeowner would pay for the shutters. Payment usually had been financed, and upon acceptance by the homeowner, the financing entity would release the proceeds of the home improvement loan which would be paid to Seaview for the product, and to Gulfstream for its sales commission. The average job sold by Gulfstream Shutter and Improvement Corp. was about $2,400 per home. Because of the way in which the sales transactions for shutters were structured, the only party which had any contractual relationship with the homeowner was Gulfstream Shutter and Improvement Corp. Mr. Hill was also able to handle work in addition to shutters, such as window replacements, because he had a contracting license. About 85 to 90 percent of Gulfstream's business was shutters and 5 percent windows or other work. The owner of Gulfstream Shutter and Improvement Corp. assumed that Seaview Manufacturing, which had been in the business of fabricating and installing shutters for more than 30 years, obtained any permits that were needed for the installation of the shutters. In fact, no permits were obtained by Seaview, Gulfstream, or Mr. Hill for those installations. Mr. Hill agreed to become qualifying agent for Gulfstream Shutter and Improvement Corp. so that he could pull permits for spin-off jobs he obtained for window work or other small remodeling jobs, such as porches, which arose in connection with contracts for awning work he obtained. Gulfstream had no other qualifying agent. This qualification took place in August 1985. When Mr. Hill qualified as the agent for Gulfstream Shutter and Import Corp., he had no oversight of the finances of the company or supervision over the shutter fabrication or installation performed by Seaview Manufacturing on contracts procured by Gulfstream's salesmen. Eventually, Mr. Hill left Gulfstream Shutter and Improvement Corp., and began his own business, Contractors Marketing, which he qualified with the Department of Professional Regulation.
Recommendation It is therefore recommended that a final order be entered finding Mr. Hill guilty of violating Section 489.119(2), Florida Statutes (1985), which make out a violation of Section 489.129(1)(j), Florida Statutes (1985), and that he be fined $250. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 22nd day of April, 1988. WILLIAM R. DORSEY, JR. Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 22nd day of April, 1988. COPIES FURNISHED: David L. Swanson, Esquire Robert C. Hill Department of Professional 5766 Northeast 15th Avenue Regulation Ft. Lauderdale, Florida 33334 130 North Monroe Street Tallahassee, Florida 32399-0750 Fred Seely William O'Neil, Esquire Executive Director General Counsel Department of Professional Department of Professional Regulation Regulation Post Office Box 2 130 North Monroe Street Jacksonville, Florida 32201 Tallahassee, Florida 32399
