The Issue The issue in the case is whether the allegations of the Administrative Complaint are correct and, if so, what penalty should be imposed.
Findings Of Fact At all times material to this case, Frederick L. Roberts (Respondent) was a licensed Florida mortgage broker, holding license number MB 316324569. In November 1993, a friend of the Respondent, Alan Petzold, introduced Tami Aaronson to him. Ms. Aaronson owned property in Maryland and was interested in securing a mortgage on the Maryland property to provide funding for a Florida home for herself and her son, Jarrett. According to Ms. Aaronson, Mr. Petzold is the father of a minor son, Jarrett Aaronson. The Respondent believed that such was the case at the time he met the family. The Respondent met several times with Ms. Aaronson. The Respondent gave a “Flagship Mortgage Company” business car to Ms. Aaronson. The business card had the Respondent’s name printed on it. The Respondent had been briefly employed by Flagship Mortgage Company, but apparently was not so employed at the time he met Ms. Aaronson. Frederick L. Roberts (Respondent) received check number 0170, dated November 22, 1993, from Tami Aaronson as “Custodian for Jarrett Aaronson” in the amount of three thousand dollars. The notation on the check states that it is for “refinancing.” Ms. Aaronson believed the check was payment for services the Respondent would render in obtaining refinancing of the Maryland property. There was no written agreement between the Respondent and Ms. Aaronson, or between the Respondent and Mr. Petzold. The Respondent completed no written documentation related to the Aaronson transaction. The Respondent did not place the Aaronson deposit into a segregated escrow account. The Respondent did not record the Aaronson deposit into an escrow transaction journal. During the period he held the Aaronson funds, the Respondent worked on unrelated business, and traveled to China for about thirty days. The Respondent performed no work on behalf of Ms. Aaronson, Mr. Petzold, or Jarrett Aaronson. There is no evidence that the Respondent intended to perform any work on behalf of Aaronson/Petzold. The Respondent asserted that he asked for a three thousand dollar “deposit” as a means of discouraging the couple from asking for his assistance. The assertion is not credible. The Respondent asserts that the three thousand dollars he received from Ms. Aaronson was a deposit against travel expenses he would incur during his examination of the property in Maryland. The assertion is not supported by credible evidence. In the spring of 1994, the Respondent received a telephone call from Ms. Aaronson. The Respondent asserts that he believed Ms. Aaronson to have called him from a mental hospital. For whatever reason, at that time he determined that he no longer wanted to be involved in the Aaronson/Petzold situation. Shortly after receiving the Aaronson phone call in spring 1994, the Respondent also received a call from a Department of Banking and Finance investigator, apparently looking into a complaint received from Ms. Aaronson. The Respondent thereafter contacted Mr. Petzold and made arrangements to return the funds to him. According to a notarized statement dated May 9, 1994, the Respondent returned the three thousand dollars to Jarrett R. Aaronson and Alan C. Petzold. The Respondent testified that the money had been returned on May 8, 1994 to Mr. Petzold. The Respondent offered into evidence a document dated May 8, 1994, purporting to be a receipt received from Mr. Petzold for return of the funds. The signature is not notarized. The Respondent did not return the Aaronson deposit to Tami Aaronson. There is no evidence that Ms. Aaronson authorized the return of the three thousand dollars to Mr. Petzold. There is no evidence that Ms. Aaronson authorized the return of funds to Jarrett. Ms. Aaronson has not received any part of the three thousand dollars allegedly refunded. There is no evidence that the funds have been redeposited into the minor child’s custodial account. The Respondent asserts that he was not acting as a mortgage broker and was merely investigating the property to determine whether the Aaronson property could be used as a source of funds for the purchase of Florida property. The Respondent asserts that had a refinancing situation arisen, he would have referred Ms. Aaronson to another licensed person who would assist in the actual refinancing. The assertion is not supported by credible evidence. The Respondent asserts that in the spring of 1994 he had reason to believe that Ms. Aaronson had been hospitalized in a mental facility, and therefore he returned the funds to Mr. Petzold. The rationale for the failure to return the funds to the appropriate party is not persuasive.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Insurance enter a Final Order suspending the mortgage broker license held by Frederick L. Roberts until the following conditions are met: Payment to Tami Aaronson of $3,000 plus appropriate interest calculated from November 22, 1993. Payment of an administrative fine in the amount of $5,000. After compliance with the above conditions, the license suspension shall be lifted, and a two-year probationary period shall begin RECOMMENDED this 22nd day of October, 1997, in Tallahassee, Leon County, Florida. WILLIAM F. QUATTLEBAUM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 22nd day of October, 1997. COPIES FURNISHED: Clyde C. Caillouet, Esquire Department of Banking and Finance 4900 Bayou Boulevard, Suite 103 Pensacola, Florida 32503 Michael W. Carlson, Esquire Carlton Fields Ward Emmanuel Smith & Cutler, P.A. 215 South Monroe Street, Suite 500 Tallahassee, Florida 32301 Harry Hooper, General Counsel Department of Banking and Finance The Capitol, Room 1302 Tallahassee, Florida 32399-0350 Hon. Robert F. Milligan Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350
The Issue Whether or not Respondents' Florida real estate licenses should be disciplined for violation of Section 475.25(1)(b) F.S., by dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction; Section 475.25(1)(d)1. F.S., failure to account for or deliver funds; Section 475.25(1)(k) F.S., failure to maintain trust funds in their real estate brokerage escrow bank account or some other proper depository until disbursement thereof was properly authorized; and Section 475.25(1)(e) and Rule 61J2-10.032(1) F.A.C. for failure to provide written notification to the Real Estate Commission upon receiving conflicting demands within 15 business days of the last party's demand or upon a good faith doubt as to who is entitled to any trust funds held in the broker's escrow account and failure to institute one of the settlement procedures as set forth in Section 475.25(1)(d)1., F.S. within 15 business days after the date the notification was received by the Division.
Findings Of Fact Petitioner is the state government 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, Section 20.165, F.S., Chapters 120, 455, and 475, F.S. and the rules promulgated pursuant thereto. The Respondent Norman Rivers, Jr. is and was at all times material hereto a licensed real estate broker, issued license number 0189212 in the accordance with Chapter 475, F.S. The last license issued was as a broker c/o Route 1, Box 344, Alachua, Florida 32615. Respondent Norman Rivers Jr., Realty, Inc. is and was at all times material hereto a corporation registered as a Florida real estate broker having been issued license number 0214407 in accordance with Chapter 475, F.S. The last license issued was at the address of Route 1, Box 344, Alachua, Florida 32615. At all times material hereto, Respondent Norman Rivers, Jr. was licensed and operating as qualifying broker and officer of Respondent Norman Rivers Jr., Realty, Inc. On December 5, 1994, Respondent showed Charles E. and Elizabeth A. Smith (husband and wife) a tract of land located in Dixie County, Florida. Afterward, Respondent Norman Rivers, Jr. sent a $57,500 offer to Charles E. Smith for his signature. On December 7, 1994, Mr. Smith signed the offer and forwarded it with a $2,875 deposit to the Respondents. The next day, the Seller, Ed Dix, accepted the Smiths' offer. The contract provided that if the deal did not close on December 23, 1994, "...if the said Buyer fails to perform the covenants herein contained within the time specified, therefore said deposit made by the Buyer may be forfeited at the option of the Seller, as liquidated damages, upon 10 days' notice to the Buyer, and one half thereof shall be retained by or paid to said Realtor and the remainder to the Seller, unless because of expense incurred the latter shall agree or had agreed in writing to a greater percentage being paid to the Realtor,..." The property sale did not close on December 23, 1994. At some point in time, Mr. Smith conversed with Respondent Rivers by telephone and told him he could not afford to purchase the property since a greater amount would have to be financed and because his wife could not be persuaded to go through with the deal. He told Mr. Rivers that he would like Mr. Rivers to return any amount remaining in excess of Mr. River's expenses but that Mr. Rivers could retain his expenses. Mr. Rivers told Mr. Smith that his expenses had used up the entire $2,875 binder. Mr. Smith accepted this representation. He testified that he "considered the issue closed" at that point. Neither Mr. or Mrs. Smith made subsequent demands for all or part of the binder. The administrative complaint herein was urged quite some time later by Mrs. Smith. The Respondents affirmatively demonstrated that Mr. Rivers' business practice from 1991 to 1995 and continuing to date, is to promptly refund deposits upon a Buyer's request, if the Seller agrees. The significance of this evidence is that if a clear demand for refund or audit had been made by Mr. Smith, Respondents probably would have made some accounting and refund. In this case, Mr. Rivers did not do so because he did not consider that he had a clear- cut request to refund a deposit. Despite Mr. Smith's testimony that his final telephone conversation with Mr. Rivers as related above in Finding of Fact 11, occurred before Christmas 1994 and Mrs. Smith's deposition testimony that Mr. Smith's and Mr. River's phone conversation occurred on December 21, 1994, before the agreed closing date all other documentary evidence and credible testimony points to the conversation occurring in mid-January 1995. The parties stipulated that on 12/21/94, Alachua County Abstract Company sent the closing package by UPS overnight delivery to Mr. and Mrs. Smith. This package was received by Mr. and Mrs. Smith on 12/22/94. The significance thereof is that Mrs. Smith testified that the telephone call made by her husband in her presence from their home to Mr. Rivers cancelling the contract and demanding the return of their deposit occurred the night before the day they received the closing package, or December 21, 1996. However, the Smiths' long distance telephone records from 12/7/94 to 1/31/95 reveal that no long distance call was made from the Smith home to Mr. Rivers on 12/21/94 or any date other than 12/7/94, the day Mr. Smith initially signed and faxed the contract to Mr. Rivers. It is noted that at one point Mr. Smith wobbled and testified that Mr. Rivers telephoned him for the final phone conversation at some time prior to Christmas 1994. This is contrary to Mrs. Smith's testimony and Respondents' telephone records do not show that Mr. Rivers telephoned the Smith home on December 21, 1994, either. Between 12/30/94 and 01/17/95, Respondents' long distance telephone bills show charges for 15 calls to Mr. Smith's several work phone numbers and the home phone number. In Mr. Rivers' words, "I chased him like a hound," to find out what was going on, including when the deal could close. This demonstrates Mr. Rivers' continued belief after December 21, 1994 that the contract was still going to close and contradicts Mrs. Smith's testimony that Mr. Smith had orally cancelled the contract and demanded the return of his deposit on December 21, 1994. It further contradicts Mr. Smith's testimony this conversation occurred sometime before Christmas, 1994. The agency stipulated that Seller Dix and Norman Rivers, Jr. entered into an agreement whereby any binder forfeiture resulting from the Smiths' failure to close on December 23, 1994 would be used by Norman Rivers, Jr. and Norman Rivers, Jr. Realty, Inc. to cover their expenses incurred in marketing Mr. Dix's property. Respondents established that prior to the contract signing on December 7, 1994, they had expended at least $3,339.00 in advertising in order to market and sell Mr. Dix's property. There is no evidence Mr. Smith ever objected to paying the advertising costs incurred by Respondents or even inquired what Mr. Rivers' expenses were. Mr. Rivers did not remove any amount related to Mr. and Mrs. Smith from his escrow account before January 16, 1995. Then he did so by three checks made out to Norman Rivers Jr. Realty, Inc. Mr. Smith and Mr. Rivers concur that Mr. Smith made no specific demand for an audit of Respondents' expenses. Real Estate Commission Investigator Russell Lambert audited Respondents' accounts. He testified he "found no violations."
Recommendation Upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Florida Real Estate Commission enter a final order dismissing the administrative complaint herein. RECOMMENDED this 2nd day of December, 1996, at Tallahassee, Florida. ELLA JANE P. DAVIS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of December, 1996. COPIES FURNISHED: Steve W. Johnson, Esquire Department of Business & Professional Regulation 400 West Robinson Street, Suite N-308 Orlando, Florida 32801-1772 James F. Gray, Esquire Post Office Box 7100 Gainesville, Florida 32605 Lynda L. Goodgame, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Henry M. Solares Division Director Division of Real Estate Post Office Box 1900 Orlando, Florida 32802-1900
The Issue Whether Respondents committed the offenses described in the administrative complaint? If so, what disciplinary action should be taken against them?
Findings Of Fact Based upon the record evidence and the stipulations entered into by the parties, the following Findings of Fact are made: Murray Wieder (Respondent Wieder) is now, and was at all times material hereto, a real estate broker licensed in the State of Florida pursuant to license number 0303130. His last license was issued c/o Wieder Realty, Inc., 900 S. Pompano Parkway, Pompano Beach, Florida 33069. Wieder Realty, Inc. is now, and was at all times material hereto, a corporation licensed in the State of Florida as a real estate broker pursuant to license number 0254413. Its last license reflects its address as 900 S. Pompano Parkway, Pompano Beach, Florida 33069. Respondent Wieder is now, and was at all times material hereto, the President of Wieder Realty, Inc., and its qualifying broker. Margaret Hoskins has been an investigator with the Department of Professional Regulation for the past year and a half. As part of her responsibilities, she conducts audits of escrow accounts maintained by real estate brokers licensed in the State of Florida. On April 27, 1989, Hoskins conducted a routine audit of Respondents' escrow accounts. Her investigation revealed that, on that date, Respondents maintained at Bank Atlantic in Fort Lauderdale, Florida, a noninterest-bearing escrow account (number 005-50199 0-3) with a balance of $14,577.39 and an interest- bearing account (number 005-175922-1) with a balance of $32,955.50. Respondents' "trust liability" with respect to these two accounts was $41,856.50. The $5,676.39 difference between the total balance of these two escrow accounts and Respondents' "trust liability" represented accrued interest on the monies deposited in the interest-bearing account. Respondents used the accrued interest to cover their incidental operating expenses. Hoskins further discovered as a result of her investigation that on March 13, 1989, Respondents had deposited $50,000.00 into the noninterest- bearing account, which prior to the transaction had had a balance of $950.58, and that on March 30, 1989, Respondents had withdrawn $25,000.00 from the interest-bearing account and had deposited $25,000.00 in the noninterest-bearing account. During the course of her investigation, Hoskins spoke with Respondent Wieder, who indicated to her that it was his practice to transfer funds from one of the Bank Atlantic escrow accounts to the other. Of the fully executed sales contracts and lease agreements Respondents' had on file, only one, the Kutner-Fox contract, contained a provision authorizing Respondents to place escrow monies in the interest-bearing account and to use the accrued interest for incidental operating expenses. The remaining contracts and leases were silent regarding the matter. Hoskins, in her conversation with Respondent, therefore attempted to find out from him if the escrow monies in the interest-bearing account, other than those attributable to the Kutner-Fox contract, had been deposited in the account with the permission of all interested parties. Wieder, who was otherwise very cooperative, failed to provide Hoskins with a direct answer to her question. Hoskins did not thereafter make any effort to contact these parties and ask them if they had given Respondents permission to place monies held in escrow in an interest- bearing account and to use the accrued interest to cover incidental operating expenses. Later on April 27, 1989, after Hoskins had completed her visit to their office, Respondents withdrew all of the funds from the interest-bearing account and deposited them in the noninterest-bearing account. They then closed the interest- bearing account. Respondents then transferred from the noninterest- bearing account to their operating account $5,676.39, the amount of interest that had accrued on the monies that had been in the interest-bearing account.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Florida Real Estate Commission issue a final order in this matter finding the proof insufficient to establish Respondents' guilt of the offenses charged and dismissing the instant administrative complaint. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 22nd day of August, 1990. STUART M. LERNER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 22nd day of August, 1990.
Findings Of Fact In November, 1972 Coastal Warehouse, a partnership, entered into a lease with Ray Industries for the rental of their property by Ray Industries. The lease provided that rental payments be made through Peerless Realty Company and also provided for renewal from year to year. The renewal clause was exercise by the lessee. By verbal agreement the lessor agreed to pay Peerless 10 percent of the lease for managing the property, supervising repairs, collecting rent, etc. Peerless' check for December, 1973 rent was forwarded to lessor on January 16, 1974 with a note on the letter (Exhibit 5) indicating payment was delayed due to late receipt of payment from lessee. Peerless' letter of February 26, 1974 (Exhibit 6) forwarded rent payment for January. Therein it was noted that on 4-24-74 lessor received a check for February and March rent and on 6-18-74 it received a check for April and May rent. This was the last rent check lessor received from Respondent. Upon inquiry to Respondent Sakson the lessor was advised that lessees were having problems meeting their rental payments. Upon inquiring of the tenants the lessor was advised that they had always made payments to Peerless when due. When no further payments were received through September, lessor instituted civil action against Respondents herein for the rental payments not received. On January 3, 1975 a final judgment was entered against Respondents in the amount of $3816.86 plus costs of $31.00 (Exhibit 8). To date judgment has not been satisfied. Exhibits 9 through 13, copies of checks payable to Peerless, show that lessee made timely rental payments in June, July, August, September, and October, 1974. None of these payments were forwarded to the lessor and the judgment represents four of these monthly payments. On December 14, 1973, a contract for the sale of property was negotiated by a salesperson in Peerless' office and a $2000 earnest money deposit was received and deposited in Peerless Escrow Account. Due to default on the part of the buyer the transaction never closed and the buyer forfeited his deposit. By letter dated July 1, 1974 (Exhibit 16) Respondents notified the saleswoman Ms. Holly,nee Caspers, that the sale may not close, and if not, she would be entitled to $500 commission. Enclosed with letter dated 7-16-75 (Exhibit 17) Ms. Caspers received a check from Respondents on the Merritt Island Bank in the amount of $500 which she deposited at her bank in Hallandale. The check was returned by her bank steeped "Account Closed" (Exhibit 18) and her account was debited the amount of the check (Exhibit 19). In December, 1974 property listed with Peerless was sold by another realty office. The purchaser desired a survey on the property at no expense to her. The salesman (Sutton) who negotiated the contract discussed the survey with Sakson and as a result understood that the cost of the survey would be split between the seller and the two real estate firms involved. The survey was commissioned by Sutton for $100. Upon receipt of the bill he forwarded the bill with his check in the amount of $25 to Peerless. He subsequently learned from the seller that the latter never agreed to pay part of the cost of the survey. Sutton was later told by Sakson that the cost of the survey had been paid. When the surveyor demanded payment from Sakson the latter said he would mail the check but never did so and discouraged the surveyer from coming by the office to pick up the check when he volunteered to do so. Merritt Island Development Corporation, a Miami based company owned rental property on Merritt Island for which Peerless was engaged to act as rental agent, collect rent, and generally supervise property. There were two tenants of the building viz. Foam King and Atlantic Screen, each of whom made the rental payments promptly during the months of January, February and March, 1974. These checks were deposited in Peerless Realty Escrow Account. In May, 1974 Respondent forwarded to lessor a check in the amount of $1876.90 representing these three months rent from the two tenants. When this check was presented for payment it was dishonored. The check was thereafter twice redeposited upon the advice of Sakson that it would clear and each time it was dishonored. Sakson advised lessor several times that he would make the check good, but did not do so. On October 11, 1974 Merritt Island Development Corporation obtained a judgment against Peerless (Exhibit 32) in the amount of the check plus cost. This judgment was subsequently satisfied. In the interim the lessor contacted the tenant and requested payment be made direct to the Miami office which request was honored and lessor no longer engaged Peerless as rental agent. In contract dated April 2, 1974, Jean Berkowitz presented a $10,000 check payable to Peerless Realty Company Escrow Account as an earnest money deposit on the property subject to the contract. The contract provided closing within 30 days of acceptance. The listing broker on this contract was Anderson Realty and the selling broker was Peerless. At the request of the buyer the closing date was extended one or two times. By letter of September 12, 1974 the attorney for seller advised buyer that on September 20, 1974 the buyer would tender deed and expected purchaser to be at the closing with sufficient funds to meet the obligations of the contract. At this closing neither the buyer nor Sakson appeared. By letter dated September 20, 1974 (Exhibit 39) the attorney for seller advised the attorney for buyer that an extension of the contract would be granted until October 7, 1974 on the basis of the buyer making an additional deposit of $2,500 with the entire deposit of $12,500 paid to seller and non- refundable if contract did not close for any reason other than the fault of the seller. Peerless issued check dated 9-20-74 in the amount of $2,500 to seller. When presented for collection this check was dishonored. Subsequent thereto Sakson presented a cashier's check and another check totaling $2,500 to seller which were honored. When the October 16, 1974 closing date arrived the buyer did not appear. By letter of October 24, 1974 the attorney for buyer advised Respondent that the contract had been terminated by reason of failure of the buyer to carry out the terms of the contract and demanded payment of the seller's share of the $10,000 deposit, $4,687.50. This sum was never disbursed by Respondent to the seller.
Findings Of Fact Respondent is currently licensed, and as of the date of the Administrative Charges and Complaint, held license No. HB-0008511 as a mortgage broker and was president and principal broker of Bay Area Financial Services, Inc. He has held such license since November 1979. He sold the business in April 1980 and has reapplied within six months for an individual license. The application was received on May 16, 1980. Pursuant to Rule 3D-40.03(3), Florida Administrative Code, Respondent is treated as a current licensee, and as an applicant. From October 25, 1977, until June 12, 1979, Respondent was employed as vice-president and principal mortgage broker by United Companies Mortgage and Investment of St. Petersburg, Inc., hereinafter UCMI, a mortgage brokerage firm. United Companies Financial Corporation, hereinafter UCFC, is a Louisiana corporation, authorized to do business in Florida. The company engages in the business as a mortgage lender. On August 31, 1978, UCMI by and through its broker, Respondent, made a loan to "James G. Anderson" and "Lorraine Anderson, his wife," and accepted a note in the amount of $14,500.00 made by "James G. Anderson and Lorraine Anderson," together with a first mortgage also made by "James G. Anderson and Lorraine Anderson, his wife," as security for the repayment of the loan. The first mortgage purported to encumber Lot 25, Oak Harbor Subdivision, according to the plat thereof as recorded in Plat Book 5, page 94, Public Records of Pinellas County, Florida. On August 31, 1978, UCMI, for value, assigned the note and mortgage to UCFC. The Respondent has no objection as to the authenticity and genuineness of Exhibit 11, a copy of a contract for sale of real estate which, on its fact, was executed by "James G. Anderson and Lorraine Anderson," as purchasers of certain real property from the seller, Linda Carol Querry, a/k/a L. C. Querry. The document reflects that the purchase price be $18,500.00, payable $100.00 in cash as a deposit, $900.00 cash within twenty-four hours, $4,500.00 additional deposit at time of closing, and $13,000.00 mortgage balance. (Exhibit 2). Anderson acknowledged his signature on this document but has no recollection of signing it. On August 31, 1978, a Notice to Customers, required by federal law, was executed by "James G. Anderson and his wife Lorraine," setting forth the disclosure requirements of Regulation Z. The lender is reflected as UCFC and the broker as UCMI of St. Petersburg. Respondent Hughes executed such document as a witness to the signatures of "Mr. and Mrs. Anderson." On August 31, 1978, a promissory note was executed by "James G. Anderson and Lorraine Anderson" promising to pay UCMI the sum of $14,500.00. (Exhibit 3). On August 31, 1978, a document entitled Consummation of Loan Secured by Real Property, was executed by "James G. Anderson and Lorraine Anderson," as the borrowers. (Exhibit 4). On August 31, 1978, a document entitled Notice to Customer Required by Federal Law was executed by "James G. Anderson and Lorraine Anderson," as the borrowers. (Exhibit 5). On August 31, 1978, a document regarding the loan transaction was executed by "James G. Anderson and Lorraine Anderson," acknowledging receipt of the "Good Faith Estimates," and certain other materials. (Exhibit 6). On August 31, 1978, a Notice to Purchaser-Mortgagor was executed by "James G. Anderson and his wife, Lorraine Anderson" acknowledging receipt of such notice. (Exhibit 7). On August 31, 1978, an Owner's Affidavit was executed by "James G. Anderson and his wife, Lorraine." (Exhibit 8). On August 28, 1978, a loan application was executed by "James G. Anderson" for the $14,500.00 to be secured by a first mortgage. Respondent personally handled the application as indicated on the application itself. (Exhibit 1). On August 31, 1978, check No. 15-39091 was executed by Respondent Hughes, as authorized representative of United Companies, Inc., as payor, to James G. Anderson and Title Consultants, as payees, in the amount of $11,014.58. The check was endorsed by "James G. Anderson and Lorraine Anderson." (Exhibit 10). On August 31, 1978, a Warranty Deed was executed by Linda Carol Querry, a/k/a L. C. Querry, as seller of certain real property to "James G. Anderson and Lorraine Anderson, his wife." Respondent Hughes executed the document as a witness to Linda Querry's signature and execution. The property described in the Warranty Deed is the identical property mortgaged by "James G. Anderson and Lorraine Anderson" to secure the loan from UCMI and UCFC. (Exhibit 13). On August 31, 1978, a Mortgage Deed was executed by "James G. Anderson and Lorraine Anderson, his wife," as mortgagors, to UCMI of St. Petersburg, as mortgagee, as security for the repayment of the loan. Respondent Hughes executed the Mortgage Deed as a witness to the signatures of "Mr. and Mrs. Anderson." (Exhibit 9). On August 31, 1978, UCMI, by and through its principal broker and vice president, Respondent Hughes, assigned the Anderson mortgage and note to UCFC. The applicable Florida law governing this matter is Chapter 494, Florida Statutes (1977), and as amended in the 1978 Supplement, and Chapter 3D- 40, administrative rules regulating mortgage brokerage, Florida Administrative Code. In August 1978, James G. Anderson, who worked in the Sanitation Department of the City of St. Petersburg, also worked part-time repainting houses purchased for resale by Vic Vogel, a speculator. While so employed, Anderson had seen Respondent a few times in the company of Vogel, but had never formally met Respondent. Vogel offered to sell one of these houses to Anderson on terms that would require no down payment by Anderson, who would thereafter make monthly payments similar to the rental payments he was then making. Further, there would be no "red tape" and Anderson would be buying a home rather than renting one. Anderson trusted Vogel, who assured Anderson he would take care of all the details. The house Anderson agreed to buy was on 11th Street and 20th Avenue South in St. Petersburg and was one of the houses Anderson had worked on in his part-time job with Vogel. In the contract to purchase signed by Anderson (Exhibit 11) the block for the legal description of the property is blank. The various other spaces on the form now showing the purchase price, down payment, etc., were blank when signed by Anderson. For several years prior to 1977 Anderson had been living with Lorraine Walker but never held her out as his wife. The signature "Lorraine Anderson" on all exhibits except Exhibit 14, the quitclaim deed from Anderson to United Companies Financial Corporation, were signed by someone other than Lorraine Walker. At the instigation of his attorney, Anderson and Lorraine Walker signed Exhibit 14 to clear up foreclosure proceedings that had been instituted against Anderson. The closing of the sale of property to Anderson took place at the offices of United Companies at 300 S. Duncan Street, Clearwater, Florida on 31 August 1978. Anderson was picked up by Vogel and driven to the closing. Accompanying Vogel was Mike Robertson, an associate of Vogel; Linda Querry, Vogel's girl friend, who signed the deed conveying the property to Anderson; and an unidentified black woman. While awaiting Respondent's arrival for the closing, Vogel took the group to lunch. At the closing, Anderson signed numerous documents and other people, including the black woman who obviously signed "Lorraine Anderson," also signed these documents as witnesses and/or notary. Anderson does not recall having seen Verona Krnjaich, who notarized his signature on the documents he signed at the closing and Ms. Krnjaich does not recall a closing at which Anderson was present. However, she testified that her normal practice is to notarize only documents notarized in her presence, and that she follows this practice at all closings. On the other hand, she has good recall of faces seen at closings but does not believe she ever saw Anderson before this hearing. Anderson testified that he trusted Vogel and signed whatever documents Vogel asked him to sign; that all the documents bearing his signature were blank when he signed them; that he did not know the black woman in the room at the closing or that when she signed these documents she did so in the name of Lorraine Anderson; that the closing took place on the second or third floor of a building just off U.S. 19 between Clearwater and St. Petersburg; that he doesn't know the address of this building but could return to it, and in fact, a few months prior to this hearing, took one of Petitioner's agents to the building where the closing took place; that he received no copy of any document signed by him at the closing; that he thought he was buying a house from Vogel; and that he expected Vogel to notify him after the closing when he could move in and how much he would pay each month. Vogel did not again contact Anderson and apparently has left the area. A few months prior to this hearing Anderson accompanied one of Petitioner's agents to show the agent where the closing occurred. The building to which the agent was taken by Anderson is two-storied and occupied by Ellis National Bank. In August 1978 there was no other occupant of this building and the second floor was unfinished but contained restrooms and some offices occupied by bank employees. Anderson made no cash payment before, at, or after the closing on this house; nor did he ever move into it. The legal description on the deed conveying the property to Anderson is for property located at 626-27th Avenue South, St. Petersburg, Florida, and not for the house at 11th Street and 20th Avenue South which Anderson thought he was buying. After Anderson became delinquent on his mortgage payments Respondent went to Anderson's home one Sunday afternoon demanding payment of the delinquent monthly payments owed by Anderson. The latter told Respondent he hadn't bought any house from the lender, owed no money, and wasn't going to pay. Respondent shortly thereafter turned the case over to the United Companies' attorney, who instituted foreclosure proceedings. When served with these papers Anderson took them to his lawyer. After some of the facts surrounding this transaction became apparent, the assignee of the mortgagee accepted a quitclaim deed to the mortgaged property from Anderson. Lorraine Walker accompanied Anderson to the lawyer's office and signed the quitclaim deed "Lorraine Anderson" (Exhibit 14). The deed signed by L. C. Querry conveying Lot 25 to Anderson (Exhibit 13) conveyed the property to "James G. Anderson and Lorraine Anderson, his wife." Respondent had known Vic Vogel for five or six years prior to August 1977 and had been involved in ten or twelve transactions in which Vogel had picked up distressed property, refurbished it and sold it. Anderson had few debts and readily qualified for the mortgage loan without considering the income of Lorraine or his income from his part-time work. He understood he was buying the house without any down payment, and, in fact, Anderson paid nothing down when he signed the contract and he produced no cash at the closing. The only disbursement made at closing was by the mortgagee, whose check for $11,014.58 (Exhibit 10) was payable to Title Consultants and Anderson. The latter endorsed this check and presumably Title Consultants disbursed to the seller. Closing statements for the buyer and seller were not in the files of UCMI or Title Consultants, nor was a contract to purchase in which the description of the property to be bought was shown. Respondent's witness testified that she reviewed all documents prior to a closing; that she recalls the Anderson transaction; doesn't recall who prepared those documents but believes she typed them; that documents were never signed in blank and the blanks subsequently completed; that she did the credit check on Anderson; and that all documents used in the closing were completed in full before the closing at which they were signed by Anderson and the person signing as Lorraine Anderson. A check with the credit bureau should have disclosed Anderson's marital status as not married and this witness was unable to explain the failure to pick this up when Exhibit 1, the loan application, was verified with the credit bureau. Respondent testified that he recalled the Anderson transaction on 31 August 1978 but later in his testimony stated he did not recall this specific transaction. He believes he followed his usual procedure and explained the various documents to Anderson before the latter signed them. Prior to 1978 he had closed many transactions for UCMI without a contract to purchase having been executed. The loan application is mailed to the main office of United Companies in Baton Rouge, Louisiana and telephonic approval is given by Baton Rouge. Accordingly, it was not unusual for Anderson's loan application to be prepared 28 August 1978, the original mailed to Baton Rouge and approval received in time to close the transaction on 31 August 1978. The contract upon which this house was conveyed, and the closing statements of buyer or seller, were not presented at this hearing. Witnesses testified these documents were missing from the files in which they would be expected to keep. Regardless of this, it is uncontradicted that Anderson made no payment at closing and, if any payment was made prior to closing, any such payment would have been accounted for by the escrow agent. It is also evident that no such accounting was made. By signing a note and mortgage for $14,500.00 Anderson purported to purchase a house for slightly more than $11,000.00, which is the amount of the check endorsed by Anderson at closing and which sum presumably went to the seller. Some $3,000.00 was retained by the lender as prepaid finance charges ($1,567.67) and brokerage fee ($1,545.45). (Exhibit 2.) Accordingly, the mortgage of $14,500 represented approximately 130% of the amount paid for this house. This fact was known, or should have been known, to Respondent, who presumably was representing his principal, UCMI, the lender at this closing. Respondent was paid a fixed salary by UCMI and did not receive additional compensation for each transaction he closed. UCMI suffered a financial loss on the repossession of the house from Anderson and filed suit against Industrial Valley Title Insurance Company (Exhibit 15).
Recommendation From the foregoing it is concluded that Respondent was guilty of concealing material facts from UCMI involving the transaction with Anderson at which UCMI was mortgagee, and that, as a result, UCMI suffered injury. It is therefore RECOMMENDED that Robert E. Hughes' license as a mortgage broker be suspended for a period of six (6) months. DONE AND ENTERED this 17th day of October 1980. COPIES FURNISHED: Franklyn J. Wollett, Esquire Assistant General Counsel Office of the Comptroller Room 1302, The Capitol Tallahassee, Florida 32301 George W. Greer, Esquire 302 South Garden Avenue Clearwater, Florida 33516 K. N. AYERS Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 17th day of October 1980.
Findings Of Fact At all times material hereto, Respondent Robert Marriott has been a licensed real estate broker/salesman under the laws of the State of Florida, trading as Marriott Realty. In February of 1980, in his capacity as a real estate broker/salesman, Respondent obtained an offer to purchase commercial property in Miami from Orlando Villacis, a resident of Ecuador, as purchaser, for a total purchase price of $500,000. In conjunction with the offer, Villacis paid a $20,000 earnest money deposit to be held by Marriott Realty in escrow under the terms of the offer. Villacis' deposit check in the amount of $20,000 was deposited into the Marriott Realty escrow account on February 22, 1980. By March 11, 1980, Villacis' $20,000 had been withdrawn, leaving an escrow account balance of $40. This fact was never reported to Villacis. Having heard nothing definite from Respondent with regard to the offer, and because he spent most of his time out of the country, Villacis engaged the services of attorney Rafael Penalver. Prior to July 1980, Penalver contacted the Respondent and inquired as to the status of the offer. Each time, Respondent told him that the seller was still considering the offer. In July of 1980, Respondent told Penalver that the $500,000 offer had been rejected by the seller and recommended that Villacis present an offer for $570,000. Penalver prepared the offer in the amount of $570,000, again calling for a $20,000 earnest money deposit, which Penalver and Villacis assumed was still in the Marriott Realty escrow account. Receiving no response from Respondent on the second offer, Penalver attempted to contact Respondent by telephone on numerous occasions. When Penalver was successful, Respondent told him that the seller was reviewing the offer. In early September 1980, Respondent advised Penalver that the $570,000 offer had been rejected by the seller. By letter dated September 11, 1980, Penalver raised the offer to $600,000, set a deadline of September 19 for the acceptance of the offer, and directed Respondent to return the $20,000 immediately should the offer not be accepted. After September 19, having heard nothing from the Respondent, Penalver called him, at which time Respondent advised that the offer was being considered by the seller. Penalver then wrote a letter dated October 7, 1980, to Respondent demanding that Respondent deposit the $20,000 into Villacis' account. Again hearing nothing from Respondent, Penalver on numerous occasions attempted to contact him by telephone in order to again demand the immediate return of the $20,000 deposit. Being unsuccessful, Penalver wrote the Respondent on November 20, 1980, and January 22, 1981, both times demanding the return of the $20,000 earnest money deposit. After the letter of January 22, 1981, Respondent agreed to meet with Penalver in Penalver's office. On February 2, 1981, the Respondent and his wife met with Penalver. During that meeting, Respondent advised Penalver that the $20,000 was no longer available and that he and his wife had used the money to make mortgage payments and cosmetic improvements on their personal residence. Respondent challenged Penalver to sue him to get the money back. After discussing Respondent's position with Villacis, Penalver filed a civil action for return of the $20,000. In his Answer to the Complaint filed in that litigation, Respondent admitted that he had used the $20,000 deposit for mortgage payments and other personal household expenses and for payment of his IRS tax deficiency. Villacis obtained a Final Judgment in the civil action in the amount of $20,000 plus interest and costs on October 6, 1982. Respondent testified that he did not return the $20,000 earnest money deposit because, in approximately October 1980, Villacis verbally agreed to loan the $20,000 to Respondent. Villacis strongly denied making any offer of a loan to Respondent. The purported loan agreement would have occurred after Penalver had twice written Respondent regarding immediate return of the $20,000 and seven months after the $20,000 had disappeared from the escrow account. Further, after Penalver sent his November demand letter, Respondent wrote Villacis in December of 1980 asking that Villacis consider loaning Respondent the $20,000 in exchange for an unrecorded mortgage on Respondent's personal residence. Clearly, Respondent's testimony is not credible. As of the date of the formal hearing in this cause, the Final Judgment in favor of Villacis and against Respondent remained unpaid and Respondent had still not returned to Villacis the $20,000 earnest money deposit.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding Respondent guilty of the allegations contained within the Administrative Complaint filed against him and revoking his license as a real estate broker/salesman. DONE and RECOMMENDED this 30th day of April, 1984, in Tallahassee, Leon County, Florida. LINDA M. RIGOT, 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 30th day of April, 1984. COPIES FURNISHED: Tina Hipple, Esquire Division of Real Estate 400 West Robinson Street Orlando, Florida 32801 David I. Schlosberg, Esquire 525 North 27th Avenue, Suite 100 Miami, Florida 33125 Frederick Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Harold Huff, Executive Director Division of Real Estate 400 West Robinson Street Orlando, Florida 32801
Findings Of Fact Petitioner is a state governmental 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 Section 20.30, F.S., Chapters 120.455 and 475, F.S., and the rules promulgated pursuant thereto. Respondent is now and at all times material hereto was a licensed real estate salesman in the State of Florida having been issued License No. 0418629, in accordance with Chapter 475, F.S. The last license issued was as a salesman with a home address of 594 Andrews Street, Ormond Beach, Florida, 32075. From April 8, 1987, until September 11, 1987 he was on inactive status. From September 11, 1987 until at least November, 1987, he was on active status. His license expired March 31, 1988 and has not been renewed. Respondent and the owners (Goldsmiths) of certain property at 49 Sea Island Drive, North Ormond Beach, Florida, entered into an equity sharing agreement on October 1, 1986. Thereafter, Respondent was half owner of the property, and acted as agent for himself and the Goldsmiths for management and rental of the property. Sometime in early 1987, Respondent's former wife contacted Richard M. Dow of Watson Realty Corporation concerning Watson Realty Corporation's assuming management and rental authority over the property. Mr. Dow gave Respondent's wife a packet of information which included several types of material, including but not limited to, a blank standard lease form which had been stamped at the top with the name WATSON REALTY CORPORATION 425 S. YONGE STREET [U.S. 1] ORMOND BEACH, Florida 32074 The name "Watson Realty" was also printed in the body of the lease as agent for the premises, which, like all other crucial information was left blank. No agreement was ever reached by which Watson Realty Corp. or Mr. Dow were to take over management of the premises. On or about April 1, 1987, while still on active license status, the Respondent negotiated a six month lease of the premises at 49 Sea Island Drive, North Ormond Beach, Florida, with Sidney and Edythe Hirsch. By filling out the blank lease form obtained from Watson Realty Corp., Respondent entered into the six-month lease on behalf of himself and the Goldsmiths. He filled out the blank spaces with his name as lessor and the Hirsches as lessees, and crossed out the "Watson Realty Corp." in the body of the lease, substituting his own name therefor. He failed to cross out the stamped Watson Realty Corp. name and address at the top of the page. At the time of the signing of the lease, Respondent advised Mr. Hirsch that he was a licensed real estate agent because he had been taught he must make such disclosures in personal dealings so as not to take advantage of laymen. At formal hearing, he denied ever representing himself as an agent of Watson Realty Corp. or of Mr. Dow. Mr. Hirsch likewise testified that no such representation was made, only that Respondent said something like, "I work with them." Both Respondent and Mr. Hirsch concur that Respondent represented himself as the owner of the property in question without mentioning the Goldsmiths' interest. Hirsch knew and agreed to the scratching through of the Watson corporate name in the body of the contract, and to the substitution of Respondent's name therefor, but no one thought to cross through the stamped Watson name and address at the top of the page. In connection with the lease, Mr. Hirsch gave to the Respondent a $600 security deposit. Respondent shared the rent proceeds with the Goldsmiths even though he did not include their names on the lease or specifically advise the Hirsches of the Goldsmiths' interest in the property. Although the better course of action would have been for Respondent to make a fuller disclosure and to accurately make out the lease agreement with regard to the Goldsmiths' interest, no fraud or intent to defraud either the Goldsmiths or the Hirsches was demonstrated in Respondent's omissions in this regard. At no time alleged herein was Respondent registered as a real estate salesman in the employ of Watson Realty Corp. and at no time was the Respondent employed by Watson Realty Corp. in any capacity. Upon the termination of the lease period, the Hirsches vacated the house and made demands upon the Respondent for the return of their $600 security deposit. The Respondent refused to return the deposit because of substantial damage to the property in three rooms of the house. Hirsches' attorney and Respondent met to attempt to resolve the issue and then had a trial date set. Respondent appeared on the originally scheduled trial date but the case was continued. Respondent separated from his wife and moved to a different address without maintaining contact with the Hirsches' attorney, the court, the Department of Professional Regulation, or the Florida Real Estate Commission (FREC). Over a period of time, he lived at several addresses and eventually moved out of state. Although he was still living in the State of Florida at the time, he did not appear for trial on the security deposit demand, and on January 14, 1988, the Hirsches obtained a civil judgment against Respondent for payment of the $600 security deposit. Respondent had not satisfied the judgment as of the date of the filing of the Administrative Complaint herein and did not do so up through the date of formal hearing. Although Respondent expended a great deal of effort at formal hearing attempting to establish that he never received actual notice of the trial date for the $600 civil damages suit due to his frequent change of addresses during the course of his divorce, that is immaterial because the law presumes notice once suit is filed and properly served as apparently occurred in that case. Unless set aside, the judgment against Respondent was final and Respondent owed Hirsch the money due under it. However, under the circumstances, it is found that Respondent did not fail to pay Hirsch on the judgment through any intent to defraud, but merely through a misunderstanding as to the effect of the judgment. Mr. Hirsch eventually sought and obtained reimbursement of the $600 judgment amount from the FREC client security fund. The fund paid after significant unsuccessful attempts had been made to find Respondent. Respondent also maintained that he did not know about the reimbursement proceedings instituted by FREC until four days before formal hearing and he made offers at formal hearing to pay off this amount. He was not charged in the pending Administrative Complaint in this proceeding with any fraud with regard to his failure to respond to service in the FREC client security fund reimbursement proceeding.
Recommendation Upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Florida Real Estate Commission enter a Final Order dismissing the Administrative Complaint. DONE and ENTERED this 30th day of May, 1989, in Tallahassee, Florida. ELLA JANE P. DAVIS 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 May, 1989. APPENDIX TO THE RECOMMENDED ORDER IN CASE NO. 88-6331 The following constitute specific rulings pursuant to Section 120.59(2), F.S., upon the parties' respective Proposed Findings of Fact (PFOF): Petitioner' s PFOF: Petitioner filed no PFOF. Respondent' s PFOF: 1,13,14 Accepted in part; the remainder is rejected as subordinate to the facts as found. 2-5 Rejected as subordinate to the facts as found. 6-12 Rejected as immaterial and as referencing and relying upon matters outside the record as created at formal hearing. 15,16 Rejected in part as subordinate to the facts as found and in part as cumulative and otherwise as mere argument. COPIES FURNISHED: Arthur R. Shell, Jr. Senior Attorney Division of Real Estate Department of Professional Regulation 400 W. Robinson Street Orlando, Florida 32801 Mr. Frederick A. Bentley 402 Daytona Avenue Holly Hill, Florida 32017 Darlene F. Keller, Director Division of Real Estate 400 W. Robinson Street Tallahassee, Florida 32802 Kenneth Easley, General Counsel Department of Professional Regulation 1940 North Monroe Street, Suite 60 Tallahassee, Florida 32399-0750
