Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received and the entire record compiled herein, I hereby make the following relevant factual findings. David B.C. Yeomans, Jr., is now and was at all times material hereto a licensed real estate broker having been issued license number 0163386. During times material, Respondent was the qualifying broker for G & A Realty and Investments, Inc., a corporation licensed as a real estate broker in the State of Florida. 1/ From approximately April 1985 to December 1985, Respondent Yeomans was the president and qualifying broker for G & A. Wilfredo Gonzalez, a licensed real estate salesman and Alberto Aranda were each 50 percent shareholders of G & A. Wilfredo Gonzalez, while licensed as a real estate salesman in the employ of G & A, solicited and obtained a client, Alfredo Susi, who made an offer to purchase a commercial property in Dade County, Florida. In connection with the offer, Alfredo Susi entrusted a $10,000 earnest money deposit with Wilfredo Gonzalez to be held in trust in G & A's escrow account. The seller rejected Susi's offer to purchase whereupon Alfredo Susi made demands upon Gonzalez for return of the earnest money deposit. Wilfredo Gonzalez attempted to return the earnest money deposit entrusted by Susi via check dated November 18, 1985 drawn on G & A's escrow account. Upon presentation of the subject check by Susi, it was returned unpaid due to non-sufficient funds. Alfredo Susi has been unable to obtain a refund of the deposit submitted to Gonzalez. Wilfredo Gonzalez used the deposit presented by Susi and did not apprise Respondent Yeomans of what or how he intended to dispose of Susi's deposit. Alfredo Susi had no dealing with Respondent Yeomans and in fact testified and it is found herein, that Susi's dealings in this transaction, were exclusively with Wilfredo Gonzalez. Tony Figueredo, a former salesman with G & A, is familiar with the brokerage acts and services performed by Respondent Yeomans and Wilfredo Gonzalez. During his employment with G & A, Figueredo had no dealing with Respondent Yeonans and in fact gave all escrow monies to Wilfredo Gonzalez. Carolyn Miller, the president and broker for Rite Way, Realtors, an area brokerage entity, is familiar with the customs and practices in the Dade County area brokerage operations. Ms. Miller considered it a broker's responsibility to supervise all salesman and to review escrow deposits and corresponding accounts approximately bimonthly. Theodore J. Pappas, Board Chairman for Keyes Realtors, a major real estate brokerage entity in Dade County, also considered it the broker's responsibility to place escrow accounts into the care and custody of a secretary and not the salesman. Mr. Pappas considered that in order to insure that funds were not misappropriated, checks and balances and intensive training programs would have to be installed to minimize the risk of misappropriation of escrow deposits. Mr. Pappas conceded however that it was difficult to protect against dishonest salesman. Respondent Yeomans has been a salesman for approximately eleven years and during that time, he has been a broker for ten of those eleven years. During approximately mid 1984, Respondent Yeomans entered into a six (6) month agreement with G & A to be the qualifying broker and to attempt to sell a large tract of land listed by Context Realty in Marion County (Ocala). When Respondent agreed to become the qualifying broker for G & A Respondent was a signator to the escrow account for G & A Realty. Sometime subsequent to Respondent qualifying as broker for G & A, Wilfredo Gonzalez changed the escrow account and Respondent Yeomans was unfamiliar with that fact. Respondent Yeomans first became aware of Susi's complaint during late 1985 or early 1986. Respondent Yeomans was not a signator on the escrow account where Wilfredo Gonzalez placed the escrow deposit entrusted by Alfredo Susi. (Petitioner's Exhibit 9) During approximately November, 1986, Respondent Yeomans made it known to the officers at G & A that he was withdrawing his license from G & A and attempted to get G & A's officers to effect the change. When this did not occur by December, 1986, Respondent Yeomans effectuated the change himself and terminated his affiliation with G & A. During the time when Respondent was the qualifying agent for G & A, there were approximately four employees and little activity to review in the way of overseeing real estate salespersons. During this period, Respondent Yeomans reviewed the escrow account for G & A that he was aware of. During the time that Respondent Yeomans was qualifying broker for G & A, he was primarily involved in the undeveloped acreage owned by Context Realty and other REO listed property of G & A. During the period when Respondent Yeomans was qualifying agent for G & A, Wilfredo Gonzalez spent approximately 95 percent of his time managing rental property that he (Gonzalez) owned.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED: That the Administrative Complaint filed herein be DISMISSED. RECOMMENDED this 9th day of June, 1987 in Tallahassee, Leon County, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of June, 1987.
Findings Of Fact At all times referred to in these findings of fact, Carlson was a licensed real estate salesman having been issued License Number 0187184. The last license issued was as a salesman, c/o Pauls Real Estate and Investments, Inc., 441 East Shore Drive, Clearwater Beach, Florida 33515. From October 13, 1982, to June 28, 1983, Carlson was licensed as a real estate salesman in the employ of corporate real estate broker Alliance Real Estate, Inc. of which Nicholas G. Mastro was a qualifying broker and officer. During her employment, Carlson was employed to solicit and obtain landlords and tenants in connection with the rental property management brokerage business of Alliance Real Estate, Inc. Carlson worked out of Alliance's Clearwater Beach office, ten miles from the main office on Gulf-to-Bay Boulevard, Clearwater. Generally, Alliance's official policy was that the originals of property listings, property management agreements and rental agreements were to be maintained at the main office, with work copies filed at the Beach office. Correspondence and miscellaneous property management papers, such as invoices, frequently are maintained exclusively at the Beach office. Funds were to be deposited into, and checks were to be written out of, Alliance's operating account by Alliance's staff at the main office. However, due to the distance between the main office and the Beach office, it was inefficient and inconvenient for Carlson to follow the official policies and procedures. Instead, Carlson began using her own personal bank account as a conduit for funds flowing to and from Alliance (including brokerage fees to Alliance). She also ceased following the procedure for maintaining certain original papers at the main office and even began maintaining files at her home. Alliance knew or should have known that Carlson was using her personal bank account as a conduit for Alliance funds. Alliance's ledgers showed these transactions, and Alliance's bookkeeper wrote reimbursement checks to Carlson for some of them. Since Ronald Lohr, Alliance's qualifying broker with supervisory responsibility over the Beach office, did not testify, the evidence did not preclude the possibility that he had actual or constructive knowledge of this deviation from official policy. Regarding Carlson's maintenance of files (including original papers normally kept at the main office) at her house, Alliance did not have actual or constructive knowledge of this deviation from official policy. Rather, Alliance's minimal supervision of the Beach office gave Carlson the opportunity to deviate from that official policy without detection. Through the combined effect of these circumstances, Carlson was able to operate as a salesman for Alliance in connection with the following transactions while concealing the transactions from her employer and wrongfully retaining brokerage commissions which properly should have been paid over to Alliance. At the conclusion of these transactions (except one), Carlson "pitched" her file on it. In February, 1983, Carlson solicited and obtained $1,000.00 as rental payments from William Russ, as a tenant, for the rental of Unite 908, Clearwater Point Condominium, 830 S. Gulfview Blvd., Clearwater Beach, Florida owned by Bernhardt Elsen. In March, 1983, Carlson solicited and obtained $680 from Carl Dotterman, as a tenant, for the rental of Elsen's condominium. Notwithstanding that Carlson had received $1,680, Carlson advised Bernhardt Elsen that she had only received $1,600. Carlson disbursed $1,513.30 to Bernhardt Elsen, calculated as $1,600, minus $160 being a 10 percent management fee, plus $73.39 as reimbursement for payment of an electric bill. Carlson collected, received and disbursed the Russ and Dotterman rental money in her own name. She engaged in the Elsen rental property management activities and received compensation for the performance of real estate brokerage services all without the prior knowledge and consent of her employing broker, Alliance Real Estate, Inc., or any of its qualifying brokers. In February and March, 1983, Carlson negotiated for her son Martin Carlson, as tenant, and Dr. Rolando Perez, as owner, for the rental of Unit 207, Commodore Building, Clearwater Point Condominiums, Clearwater Beach, Florida, owned by Dr. Rolando Perez. Rent was to be $800. Carlson, for her son, paid Dr. Rolando Perez $720 calculated as $800 minus $80 being a 10 percent management fee. Carlson collected, received and disbursed the Carlson rental money in her own name. She engaged in the Perez rental property management activities and received compensation for the performance of real estate brokerage services all without the prior knowledge and consent of her employing broker, Alliance Real Estate, Inc., or any of its qualifying brokers. In April, 1983, Carlson solicited and obtained $500 as rental payment from a Mr. and Mrs. Scalise, as tenants, for the period April 9, 1983, to April 15, 1983, for the rental of Unit 701, Sailmaster Building, Clearwater Point Condominiums, Clearwater Beach, Florida, owned by Anthony and Jeanette Eman. On or about April 14, 1983, Carlson solicited and obtained a $100 rental deposit from Mr. and Mrs. Scalise for the rental of Eman's condominium for a period in 1984. On or about April 15, 1983, Carlson disbursed to Mr. and Mrs. Eman the $100 deposit and $200 of the $500 rental payment with $300 thereof being retained by Carlson as a management fee. Carlson collected, received and disbursed the Scalise rental money in her own name. She engaged in the Eman rental property management activities and received compensation for the performance of real estate brokerage services all without the prior knowledge and consent of her employing broker, Alliance Real Estate, Inc., or any of its qualifying brokers. In January and February, 1983, Carlson solicited and obtained $2,400 as rental payments from Ernest Pfau, as a tenant, for the rental of Unit 605, Shipmaster Building, Clearwater Point Condominiums, Clearwater Beach, Florida, owned by Joseph Seta. Carlson disbursed to Joseph Seta $2,160 calculated as $2,400 minus $240 being a 10 percent management fee. Carlson collected, received and disbursed the Pfau rental money in her own name. She engaged in the Eifert rental property management activities and received compensation for the performance of real estate brokerage services all without the prior knowledge and consent of her employing broker, Alliance Real Estate, Inc., or any of its qualifying brokers. On or about June 7, 1983, Carlson solicited and obtained a $100 rental deposit from Lawrence Augostino, as a tenant, for the rental of Unit 706, 450 Gulf Blvd., South Building, Clearwater Beach, Florida, owned by Dr. Donald F. Eifert. Carlson was to hold the deposit until she was able to obtain a listing on the rental property. While waiting for a listing on the Eifert property, Alliance, through Mr. Mastro, became aware of one of Carlson's "secret clients," Mr. Elsen, and confronted Carlson about it. In response to Mastro's demand, she retrieved the entire Elsen file from her home. When Mastro learned about a second "secret client," Dr. Perez, a short time later, Mastro immediately terminated Carlson from her employment on June 15, 1983. Carlson did not advise Alliance of the Augostino deposit and was not able to get a good address for Augostino to return the deposit before she left the Clearwater area to go to Michigan for a month. Carlson collected and received the Augostino deposit in her own name. She engaged in the Eifert rental property management activities without the prior knowledge and consent of her employing broker, Alliance Real Estate, Inc., or any of its qualifying brokers. As previously alluded to, Carlson produced evidence of having used her personal checking account as a conduit for funds flowing between Alliance and its customers (including brokerage fees payable to Alliance) with the actual or constructive knowledge of Lohr and Alliance's bookkeeper. But Carlson was unable to produce any similar evidence (such as Alliance's ledgers or her cancelled checks) in response to the absence of any Alliance corporate records indicating that Carlson paid any of the brokerage fees generated in the foregoing transactions over to Alliance. Carlson's self-serving and vague testimony that she did not owe Alliance any money was insufficient in this respect.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Commission enter a final order suspending respondent's license for two (2) years for violating Section 475.25(1)(b), Florida Statutes (1983). RECOMMENDED this 3rd day of July, 1984, in Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 3rd day of July, 1984. COPIES FURNISHED: John Huskins, Esquire Division of Real Estate Post Office Box 1900 Orlando, Florida 32002 Bruce M. Harlan, Esquire 110 Turner Street Clearwater, Florida 33516 Harold Huff, Director Division of Real Estate Post Office Box 1900 Orlando, Florida 32802 Fred M. Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, I hereby make the following Findings of Fact: Respondent, Frank Fogliano, is now and was at all times material hereto, a licensed real estate broker in the State of Florida having been issued license numbers 0249363 and 0247571. The last licenses issued were as a broker with Interval Sales, Co., Inc., 606 North U.S. 1, Fort Pierce, Florida, and with Treasure Coast Business Consultants, Inc., 100 Avenue A, Fort Pierce, Florida. Respondent, Robert Jon Casazza, is now and was at all times material hereto, a licensed real estate salesman in the State of Florida having been issued license number 0379594. The last license issued was as a salesman with Interval Sales Co., Inc., (hereinafter Interval Sales) 606 North U.S. 1, Fort Pierce. Respondent, Interval Sales and Publishing, Inc. is now and was at all times material hereto a corporation registered as a real estate broker in the State of Florida having been issued license number 0246183. The last license issued was placed in limbo on January 29, 1987, when Respondent Fogliano, the qualifying broker, gave notice that he would no longer be associated with the corporation. From September 8, 1986, to January 29, 1987, Respondent Frank Fogliano was licensed and operating as the sole qualifying broker for Respondent Interval Sales and Publishing. From October 1, 1986, to January 29, 1987, Respondent Casazza was licensed as a real estate salesman in the employ of Respondent, Interval Sales and Publishing. At all times alleged herein, Respondents Fogliano and Casazza held a one-third interest each in Respondent Interval Sales and Publishing. From August 8, 1986, through March 11, 1987, the Respondents have been engaged in the business of offering for sale condominium timeshare units owned by individual unit owners. Respondents Fogliano and Casazza believed that the only effective way to stimulate buyer interest in the resale of timeshare units was through a marketing program and through the creation of lead generations. Conventional real estate operations will not normally list and sell timeshare units offered by individual unit owners. In an attempt to develop a viable program for the resale of timeshare units, Respondents Fogliano and Casazza formed two separate companies, Respondent Interval Sales and Publishing, and Interval Sales. Interval Sales and Publishing was formed for the purpose of marketing timeshare units and Interval Sales was formed for the purpose of obtaining listings and effecting the resale of the timeshare units. Respondent Fogliano was the qualifying broker for both corporations. Respondent Interval Sales and Publishing was conceived by Casazza and Fogliano as a marketing organization with the purpose of obtaining lead generations through the use of promotional devices such as vacations, cruises and social functions. Respondents believed that face-to-face sales presentations were the most effective way of attempting to resell timeshare units. From August 8, 1986 through March 11, 1987, Respondent Interval Sales & Publishing mailed thousands of postcards and other publications to individual timeshare unit owners. The letters advised the timeshare unit owners that Respondent Interval Sales & Publishing had a timeshare resale program available and needed additional units in its "sales" inventory. When interested timeshare unit owners called the toll-free number listed on the mailings, they were advised that Respondent Interval Sales & Publishing would assist them in the resale of their units for a $199.00 promotional fee. After interested owners entered the program, their "listing" was given either to Interval Sales or Respondent Fogliano as real estate broker. The $199.00 fee went directly to Respondent Interval Sales & Publishing. Approximately 1,000 individual time share unit owners entered the program and paid Respondent Interval Sales & Publishing, the $199.00 fee. Respondent Interval Sales & Publishing informed the timeshare owners that the $199 fee was for the purpose of paying the expenses of advertising, promotion, and giving of gifts to prospective purchasers. In an attempt to lure potential buyers and create a market for the resale of the timeshare units, Respondent Interval Sales & Publishing offered mini-vacations, gifts, cruises and sponsored social events. In addition, Respondent Interval Sales & Publishing contracted with various companies such as Vacation Time and Vacation International that would provide potential buyers in exchange for a fee and the opportunity to use the offered timeshare units as part of vacation package plans. The promotional activities of Respondent Interval Sales & Publishing resulted in approximately five to eight hundred prospective buyers visiting the various units. The prospective buyers were then given sales presentations by real estate sales personnel employed by Interval Sales. The $199 fee was not placed into an escrow or trust account maintained by Respondent Interval Sales & Publishing. The money was deposited into a bank account maintained by Respondent Fogliano as "real estate broker" and then delivered to Respondent Interval Sales and Publishing. Respondent Interval Sales & Publishing maintained a staff of approximately eight employees, including two secretaries. In addition, Respondent Interval Sales & Publishing employed the services of Larry Meadow, a certified public accountant who kept an accounting of all of the funds which came and went through the company. All of the funds obtained by Respondent Interval Sales & Publishing were expended on promotional activities, advertising, office expenses and salaries. Respondent Interval Sales and Publishing expended the money without having provided a formal accounting to the owners or to the Florida Real Estate Commission. Respondents Fogliano and Casazza were aware of the advance fee provisions of Chapter 475, Florida Statutes (discussed in Conclusions of Law Section) but did not consider the fees received by Interval Sales and Publishing to be advance fees as contemplated by the statutes because they were used for "marketing." Effective January 29, 1987, Fogliano terminated his licensing status with Respondent Interval Sales and Publishing but continued to hold a one-third interest in the company. Thereafter, Respondent Interval Sales and Publishing and Respondent Casazza continued with business as usual in the marketing of the timeshare units, i.e., soliciting $199 promotional fees from timeshare owners and attempting to create a cadre of interested buyers.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that: An administrative fine of $3,000 be assessed against Respondent Interval Sales and Publishing, Inc. and the present suspension of license be continued until thirty days after the date of the Final Order. An administrative fine of $2,000 be assessed against Respondent Frank Fogliano and the present suspension of license be continued until thirty days after the date of the Final Order. An administrative fine of $1,000 be assessed against Respondent Robert Jon Casazza and the present suspension of license be continued until thirty days after the date of the Final Order. DONE and ORDERED this 10th day of August, 1987, in Tallahassee, Florida. W. MATTHEW STEVENSON 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 10th day of August, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-2585 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. Rulings on Proposed Findings of Fact Submitted by the Petitioner Addressed in Conclusions of Law Section. Adopted in Finding of Fact 1. Adopted in Findings of Fact 2 and 4. Adopted in Findings of Fact 3. Adopted in Findings of Fact 4. Adopted in Findings of Fact 5. Adopted in Findings of Fact 6. Partially adopted in Finding of Fact 10, matters not contained therein are rejected as contrary to the weight of the evidence. Adopted in Finding of Fact 14. Adopted in Finding of Fact 16. Adopted in Finding of Fact 17. Partially adopted in Finding of Fact 17, matters not contained therein are rejected as contrary to the weight of the evidence. Rejected as contrary to the weight of the evidence. Rulings on Proposed Findings of Fact Submitted by the Respondent Addressed in Conclusions of Law Section. Adopted in Finding of Fact 2. Adopted in Findings of Fact 2 and 4. Adopted in Finding of Fact 5. Adopted in Finding of Fact 4. Adopted in Finding of Fact 5. Adopted in Finding of Fact 8. Adopted in Finding of Fact 9. Adopted in Finding of Fact 11. Adopted in substance in Finding of Fact 7. Adopted in substance in Finding of Fact 10. Adopted in substance in Finding of Fact 7. Rejected as contrary to the weight of the evidence. Adopted in Findings of Fact 10 and 16. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 Michael J. Garavaglia, Esquire 3111 Cardinal Drive Vero Beach, Florida 32963 Van Poole, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Joseph A. Sole, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Harold Huff, Executive Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802
The Issue Whether respondents' licenses as real estate brokers and salespersons should be disciplined for alleged misrepresentation, fraud, breach of trust, culpable negligence, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, violation of a duty imposed by statute and contract, and aiding and conspiring with other persons engaged in misconduct-- all in violation of Section 475.25(1)(b), Florida Statutes (1981).
Findings Of Fact On March 25, 1981, Elaine P. Stein, a licensed real estate salesperson, showed Mordechai and Nuti Antebi a house for sale at 1704 North 44th Avenue, Hollywood, Florida. The house was owned by Wayne L. and Gladys E. Hunter and listed with Murray Realty. The listing broker for Murray Realty was Warren Stein, and the salesperson directly involved in the listing was Alex Olson. Elaine Stein was a salesperson in the Emerald Hills office of Chinelly Real Estate, Inc.; the manager for that office was Frederick A. Lewis, a licensed real estate salesperson. (Testimony of Stein, Antebi, Olson, Lewis.) The Antebis, who were in the process of selling their present Pembroke Pines house through the Hollywood Hills office of Chinelly Real Estate, Inc., liked the house and expressed a desire to purchase it. They were told that if they assumed the existing mortgage on the Hunters' house, the interest rate would escalate on the day of closing. (Testimony of Olson, Stein.) The Antebis and Ms. Stein then returned to the Emerald Hills office where a written offer was prepared by Ms. Stein, Vilma Sardiello--a licensed real estate salesperson who frequently worked with her--and Alex Olson, the listing Murray Realty salesperson. Ms. Antebi told Ms. Stein and Ms. Sardiello that she had only $500 to place as an earnest money deposit. The purchase price was $106,000. Ms. Stein then spoke with Mr. Lewis, who advised her that the problem could be handled by executing an assignment of funds. Such an assignment would allow proceeds from the scheduled sale of the Antebis' Pembroke Pines house to be used in the Hunter-Antebi transaction. Ms. Stein, who was unfamiliar with assignments, then procured a written assignment of funds from Ms. Antebi for the sum of $19,500 and prepared a written offer. Ms. Antebi signed the offer and provided a $500 earnest money deposit. (Testimony of Stein, Olson, Sardiello, Antebi; P-1, R-1.) Immediately thereafter, Alex Olson, Murray Realty's listing agent, telephoned the offer to the Hunters in Ocala, Florida. He informed them that the Antebis were offering to purchase their house for $106,000, consisting of a $20,00 deposit, $15,000 at closing, and assumption of the current mortgage of approximately $43,000 at the prevailing interest rate. In addition, the Hunters were to take back a $28,000 purchase money mortgage at 12 percent for five years, with only interest payable monthly (He did not inform them that $19,500 of the $20,000 deposit was in the form of, an assignment of funds from the sale of the Antebis' Pembroke Pines house. He was unaware of the assignment, which Ms. Stein had inadvertently failed to disclose in the written offer.). The Hunters telegraphed their acceptance of the offer pursuant to Mr. Olson's instructions. (Testimony of Olson, W. Hunter, G. Hunter, Antebi, Stein; P-1, P- 4.) After receiving the Hunters' telegram, Ms. Stein realized that the phrase, "assignment of funds," had been mistakenly omitted from the written offer. She alerted Mr. Lewis, who, in turn, contacted Mr. Olson on March 26, 1981, and advised him that $19,500 of the deposit would come from an assignment of the proceeds from the sale of Antebis' Pembroke Pines house. Mr. Olson responded that he would not transmit another offer to the Hunters without a written letter from Chinelly Real Estate, Inc., verifying the amount of deposit held in escrow on the Hunter-Antebi transaction. (Testimony of Olson, Lewis, Stein.) Consequently, on March 26, 1981, Mr. Lewis telephoned Ann Shetter, bookkeeper and accounts supervisor at Chinelly Real Estate, Inc.`s main office. He asked her for the amount of money on deposit in the escrow account for the Antebi transaction. She replied that there was $8,000 held in escrow on the Antebi transaction; but she failed to indicate whether she was referring to the Hunter-Antebi transaction or the Antebi sale of their Pembroke Pine house which was being handled by another Chinelly Real Estate, Inc., office at that time. Mr. Lewis reasonably (although mistakenly) assumed that she was referring to the Hunter-Antebi transaction, the only Antebi transaction being handled by his office (He was unaware that the Antebis' Pembroke Pines house was being sold by another office of Chinelly Real Estate, Inc.). Instead, Ms. Shetter was referring to $8,000, which was being held in escrow, on the Antebis' sale of their Pembroke Pines house. (Testimony of Lewis, Shetter.) Mr. Lewis then in response to Mr. Olson's request, signed and delivered an escrow letter to Mr. Olson on March 26, 1981, verifying that Chinelly Real Estate, Inc., was holding $8,000 in escrow on the Hunter-Antebi transaction. (Testimony of Lewis; P-6.) Mr. Olson then telephoned the Hunters in Ocala on March 26, 1981, and told them that the deposit would be $8,000 instead of $20,000, and that $27,000 would be paid at closing instead of the agreed upon $15,000 (These changes did not affect the total purchase price.). He also told them that be felt an $8,000 deposit would be sufficient. The Hunters agreed to the changes and at Mr. Olson's request, sent a confirming telegram to the Emerald Hills office of Chinelly Real Estate, Inc. (Testimony of Olson, Hunter, Stein; P-5.) Shortly thereafter, Mr. Olson picked up the revised contract which had been prepared by Ms. Stein and signed by the Antebis; without reading it, he sent it to the Hunters for execution. This contract, fully executed by buyers and sellers, provided for a purchase price of $106,000, an initial $500 deposit, an additional deposit paid to Chinelly Real Estate, Inc.`s trust account on or before March 26, 1981, in the amount of $7,500, an assumption by buyers of an existing first mortgage held by American Savings and Loan at prevailing interest rate in the principle amount of $43,000, a $28,000 purchase money mortgage bearing interest at 12 percent for five years, interest only, payable monthly, balloon in five years, and approximately $27,000 due at closing, including $12,000 provided by assignment of funds from the sale of the Antebis' current house. (Testimony of Stein, Olson, W. Hunter, G. Hunter; P-2.) On April 9, 1981, Nancy Gooch, vice-president in charge of processing transactions for Chinelly Real Estate, Inc., discovered the discrepancy in the Hunter-Antebi transaction, that the contract indicated that $8,000 would be deposited in the firm's escrow account while, in fact, only $500 had been deposited. She alerted her boss, John Chinelly, Jr., a licensed real estate broker, who, upon further investigation, found the Lewis letter which mistakenly represented that $8,000 was held in escrow on the Hunter-Antebi transaction. (Testimony of Chinelly; P-9.) Mr. Chinelly, who was about to depart on a four-day religious retreat, called in Reginald D. Lucas, general sales manager and a licensed real estate broker, and instructed him to find out the facts surrounding the discrepancy and solve the problem. On April 9-10, 1981, Mr. Lucas called Mr. Lewis and obtained his explanation of the escrow discrepancy; after discussing alternative courses of action, Mr. Lucas told him to meet with Ms. Stein and Ms. Sardiello and decide how they would solve the problem. Various options discussed included: (1) canceling the transaction, (2) persuading the Antebis to place an additional $7,500 into escrow, and (3) depositing the personal funds of Mr. Lewis, Ms. Stein, and Ms. Sardiello to cover the escrow shortage. On Friday, April 10, 1981, and during the ensuing weekend, they discussed among themselves possible penalties, such as loss of their jobs and licenses, and what course of action would be ethical and proper. After Ms. Stein failed to persuade Ms. Antebi to place an additional $7,500 into escrow, the three real estate salespersons--Mr. Lewis, Ms. Stein, and Ms. Sardiello--reluctantly agreed to each loan the Antebis $2,500 to make up for the Hunter-Antebi escrow shortage (They obtained a promissory note dated April 10, 1981, from the Antebis requiring repayment when the Pembroke Pines house was sold.). (Testimony of Lucas, Stein, Lewis; R-5.) Mr. Lewis, Ms. Stein, and Ms. Sardiello acted on their belief that Murray Realty and the Hunters had been told of the escrow discrepancy and consented to their loaning money to the Antebis to make up for the difference. Mr. Lucas led them to believe that such was the case. Between April 10 and 13, 1981, he had telephoned Mr. Olson to tell him about the escrow shortage. Because Mr. Olson was out of town, he spoke with Warren Stein (unrelated to Elaine Stein), the listing broker for Murray Realty. He and Mr. Stein agreed that they should promptly notify the Hunters of the situation. (Testimony of Lewis, Stein, Sardiello, Lucas.) Shortly thereafter, on April 13, 1981, Mr. Lucas went to Mr. Stein's Murray Realty office for the purpose of jointly notifying the Hunters. In the ensuing telephone call, the Hunters were told of a problem with the escrow account, that the three sales persons--Ms. Stein, Ms. Sardiello, and Mr. Lewis- -had agreed to make up for the shortage by depositing $7,500 of their own money into escrow, and that the closing would be unaffected. The Hunters knew of and consented to the three salespersons contributing $7,500 into escrow (There is conflicting testimony on whether the Hunters were told of this $7,500 contribution. The Hunters deny it while Mr. Lucas insists they were told of and consented to the arrangement. Mr. Lucas's testimony on this question is accepted as persuasive. The Hunters' testimony conflicts with the statements contained in their complaint filed with the Department.). (Testimony of Lucas; R-7.) When Mr. Olson returned to Murray Realty on April 14, 1981, and learned of the events which had transpired in his absence, he requested written verification from John C. Chinelly, Jr., that the three real estate salespersons had placed the $7,500 in escrow. Mr. Chinelly verified that the money had been placed into escrow and wrote a letter to Murray Realty confirming that fact. At that time, Mr. Chinelly--based on his conversations with Mr. Lucas and Mr. Stein--also believed that the Hunters had consented to the salespersons depositing the additional $7,500 into escrow. (Testimony of Chinelly, Olson, Lucas; P-7.) Closing of the Hunter-Antebi transaction was scheduled for April 28, 1981. At closing, the Antebis complained about the condition of the roof, pool, and air conditioner. The Antebis also did not have sufficient funds to close the transaction. The transaction failed to close. (Testimony of Stein, Antebis, Olson.) Subsequently, the Antebis closed on the scheduled sale of their Pembroke Pines house. As a condition to this closing, $7,500 was placed into escrow pending a court decision on a complaint for interpleader filed in Broward County Circuit Court by Chinelly Real Estate, Inc., concerning the Hunter-Antebi transaction. At all times material to the proceeding, respondents John C. Chinelly, Sr., Richard M. Chinelly, Paul James Fleck, Nancy J. Gooch, Mary E. Hulsey, James A. Chinelly, John C. Chinelly, Jr., Shana Munden, Joseph Tresser, Reginald D. Lucas, Harold E. Whitter, Asa F. Brand, Josephine B. Shanefelt, Brett A. Slabe, William F. Kuemerle, Jr., and Marshall Feinsilber were the qualifying brokers for Chinelly Real Estate, Inc.
Recommendation Based on the foregoing, it is RECOMMENDED: That the two administrative complaints and all charges against respondents be dismissed, with prejudice. DONE AND RECOMMENDED this 14th day of June, 1982, in Tallahassee, Florida. R. L. CALEEN, JR., 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 14th day of June, 1982. COPIES FURNISHED: Harold M. Braxton, Esquire 45 Southwest 36 Court Miami, Florida 33135 Howard Todd Jaffe, Esquire 1915 Harrison Street Hollywood, Florida 33020 Rodger L. Spink, Esquire 6600 Taft Street, Suite 404 Hollywood, Florida 33024 Michael J. Garavaglia, Esquire 3111 Cardinal Drive Vero Beach, Florida 32960 Vilma Sardiello 5207 Hayes Street Hollywood, Florida 33020 Frederick H. Wilsen, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Carlos B. Stafford Executive Director Florida Real Estate Commission Post Office Box 1900 Orlando, Florida 32802 Samuel R. Shorstein, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
The Issue The issue in this case is whether Respondents are guilty of violating Section 475.25(1)(b) and, if so, what penalty should be imposed.
Findings Of Fact Respondent Galdo has been a licensed real estate broker for eight years and holds license number 0414542. At all material times, he served as president of Respondent Real Estate Support and Development Corporation, which is registered as a real estate broker and holds license number 0243131. All references below to "Respondent" are to Respondent Galdo only. By Contract for Sale and Purchase executed by both parties on December 5, 1989, Respondent, as trustee, agreed to sell to Ruben P. Chalarca a parcel located at 12 Sandalwood Court, Oviedo, Florida. The contract calls for a closing on or before December 28, 1989. The purchase price disclosed on the contract is "approx. 46,300.00 1000.00 cash to Mortgagee." According to the contract, payment was to include the buyer taking subject to and assuming a mortgage held by "Central Fed Mortgage Co." in the approximate principal amount of $45,300. The contract contains no information as to a brokerage commission. Blanks on the form contract concerning a commission are filled in "N/A." The only involvement of Respondent Real Estate Support and Development Corporation appears to be that Respondent provided Mr. Chalarca a business card bearing the name of Respondent, the name of Respondent Real Estate Support and Development Corporation, the company's address, and telephone numbers for Respondent and the company. However, the evidence does not establish that Respondent gave the business card to Mr. Chalarca for any purpose other than giving him the information necessary to contact Respondent. There is no evidence that Respondent held himself out as representing Real Estate Support and Development Corporation in his dealings with Mr. Chalarca. The $1000 earnest money deposit that Mr. Chalarca "paid" to Respondent was by a check that never cleared. Mr. Chalarca gave another check payable to Respondent individually. The second check was dated December 5, 1989, but was only in the amount of $400. There is another check dated December 5 payable to cash and in the amount of $150, but the record does not establish that the Chalarcas gave this sum to Respondent. Except for the $1000 earnest money check, all of the Chalarcas' checks cleared. The closing took place and Respondent Galdo, as trustee, conveyed the property by deed to Mr. Chalarca and possibly his wife. Mr. and Mrs. Chalarca are from Columbia, South America. Neither has had any significant real estate experience prior to the subject transaction with Respondent. Although Mr. Chalarca speaks and understands English reasonably well, his wife does not. Mr. Chalarca did not complete high school. Prior to or at the closing, Respondent told Mr. Chalarca to make the mortgage payments to Respondent, who would make arrangements with the mortgagee, evidently to show that the Chalarcas would be making the mortgage payments. It appear that the mortgage payments may not have been current when the Chalarcas purchased the property. Respondent admitted to Petitioner's investigator that he sent the November and December, 1989, payments to the mortgagee in January, 1990, together with a request that the mortgage be transferred to the Chalarcas. He also admitted that the bank returned the package with a demand for the January, 1990, payment. Upon receipt of the demand from the bank, Respondent told the Chalarcas that they must make the January, 1990, payment at that time. However, the record establishes that the Chalarcas gave Respondent only two checks after the closing. The first is dated April 17, 1990, and in the amount of $1600. The second check is dated May 21, 1990, and in the amount of $1000. The record does not clearly establish whether Respondent ultimately made the November and December, 1990, payments. The record clearly establishes that no one made the January, February, and March payments, although there is no evidence that the Chalarcas ever tendered these payments to Respondent. For reasons not apparent from the record, Mr. Chalarca decided to make the April, 1990, payment directly to the mortgagee. This check is dated April 7, 1990, in the amount of $1220, and payable to Transohio Savings. However, the mortgagee returned the check by letter dated May 29, 1990, because the loan was already in foreclosure. The letter gave Mr. Chalarca an address to contact "in order to stop the action." Most important, the record establishes that Respondent retained the $2600 paid to him by the April and May, 1990, checks, and the record does not establish any justification for the retention of this money by Respondent. There is no indication in the record that Respondent applied this money on behalf of the Chalarcas. To the contrary, there is some indication that no payments were made on the mortgage after late 1989. By Summary Final Judgment of Foreclosure entered November 6, 1990, Transohio Savings Bank, F.S.B. obtained a foreclosure judgment on the subject mortgage against Mr. Chalarca and his wife for the total sum of $52,613.74. The foreclosure judgment shows interest on the principal balance of $5649.24 through September 23, 1990, with an additional $15.78 per day interest from September 24, 1990, through the date of entry of the judgment. The assumed interest rate was not the statutory interest rate, which is expressly imposed upon the total due, starting from the date of the judgment. If the daily interest under the foreclosed mortgage were $15.78 daily, then unpaid interest of $5649.24 represents 358 days' interest, which would suggest that no interest payments were made after September or October, 1989. The foreclosure judgment ordered the clerk to sell the property on December 20, 1990. The Chalarcas remained in the 12 Sandalwood Court parcel until about the time of the sale.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that the Florida Real Estate Commission enter a final order dismissing the Administrative Complaint against Real Estate Support and Development Corporation, finding Roger Galdo guilty of violating Section 475.25(1)(b), suspending his license for six months, placing him on probation for 18 months following the end of the suspension, and imposing upon him an administrative fine of $1000. ENTERED this 9th day of September, 1991, in Tallahassee, Florida. ROBERT E. MEALE Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of September, 1991. APPENDIX TO RECOMMENDED ORDER CASE NO. 91-4449 Treatment of Proposed Findings of Petitioner 1-3: adopted. 4: rejected as irrelevant. 5: adopted. 6: adopted except that the $1000 check was dishonored. 7: adopted. 8: rejected as unsupported by the appropriate weight of the evidence. All of the checks that the Chalarcas gave Respondent have been identified in the recommended order., which also identifies when these checks were delivered to Respondent. The evidence does not establish by the requisite standard that the Chalarcas gave Respondent the mortgage payments each month when they were due, or even that they gave Respondent funds sufficient to make the mortgage payments that fell due following the closing. 9: adopted except as the characterization of Mr. Chalarca as "suspicious." The characterization is rejected as unsupported by the appropriate standard of evidence. 10: adopted. 11: rejected as unsupported by the appropriate weight of the evidence. The record does not establish Mr. Chalarca's motivation for giving Respondent the two checks totalling $2600. 12: adopted, although a substantial amount of time elapsed between the service of the foreclosure summons and the departure of the Chalarcas from the mortgaged property. 13: adopted. 14: rejected as unsupported by the appropriate weight of the evidence. 15-19: rejected as recitation of evidence. COPIES FURNISHED: Darlene F. Keller Division Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, FL 32801 Attorney Janine B. Myrick Division of Real Estate Legal Section P.O. Box 1900 Orlando, FL 32802-1900 Roger Galdo 208 Madeira Avenue Orlando, FL 32825 Jack McRay, General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, FL 32399-0792
Findings Of Fact William J. Francis, Respondent, is now, and was at all times alleged in the Administrative Complaint, a licensed real estate broker in the State of Florida, having license No. 0388666. Respondent, V R Business Brokers of Lakeland, Inc., is currently, and was at all times alleged in the Administrative Complaint, a real estate broker corporation, having been issued license No. 0224405. At all times alleged in the Administrative Complaint, Respondent Francis was licensed and operating as a real estate broker and sole qualifying broker and officer of Respondent, V R Business Brokers of Lakeland, Inc. Respondent, via Theresa Rosalie Francis, a broker/salesman and wife of Respondent, employed by V R Business Brokers, obtained from Joyce Houser a listing agreement (Exhibit 1) to sell a restaurant called "Bac O' The Mall at a price of $43,000. This listing agreement provided a minimum commission of $6,000 to the broker. Subsequent to obtaining the listing agreement, another employee of V R Business Brokers, James Rice, a real estate salesman, obtained a written offer to purchase "Bac O' The Mall" on January 13, 1983 (Exhibit 2). This offer was made by Robert Stevens and Richard Destin to purchase the business for $30,000, with a $500 deposit and an additional $1,500 down payment when the seller accepted the offer and the balance of $28,000 at closing. Joyce Houser was advised the offer had been received and was requested to come down to Respondent's office to have it presented. Mrs. Houser went to the office of Respondent and was quite upset with the disparity in asking price and the offer. Salesman Rice, who had obtained the offer, urged Mrs. Houser to accept the contract immediately because the business had been losing money and a better offer might not be forthcoming. Mrs. Houser refused this offer and contacted her brother, a real estate broker, who helped her prepare a counteroffer. Prior to this offer being submitted, Mrs. Houser had become unhappy with her dealings with V R Business Brokers due to salesmen bringing clients in at inopportune times to show the business and for failing to maintain secrecy with respect to her employees of the fact that the business was for sale. A prior offer had also been obtained on which Mrs. Houser felt she had been pressured by Respondent to accept; and she had directed all negotiations to be made through her brother, Charles Whitten. The buyers accepted the counteroffer (Exhibit 7) When the counteroffer was accepted, Whitten reminded Respondent that the additional $1,500 was due. When the buyers did not appear the following day with the additional deposit, Respondent, who had agreed to hold the buyers' personal check for $500 to be replaced with a cashier's check for $2,000, apparently became suspicious of the buyers' ability to pay and called the bank on which the check had been written to find out if sufficient funds were on deposit to cover the check. When advised that there were insufficient funds to cover the check, Respondent sent the check to his escrow agent to have the check sent to the bank where, in fact, it was subsequently dishonored. Respondent never advised Mrs. Houser or Charles Whitten that the $500 check bounced or that the buyers had failed to deposit the additional $1,500 required by the contract until after the scheduled date of closing. A few days before the February 15, 1983, scheduled closing date Respondent or his salesman contacted Whitten to solicit Mrs. Houser to finance part of the purchase price. She declined to do so. At the time the initial contract was submitted by Destin and Stevens, Respondent knew these buyers were unemployed engineers and soon thereafter learned they were attempting to borrow the money to finance the deal, and that the banks would not lend them the money they needed. Nevertheless, Respondent attempted to induce the seller to finance the sale of the business when he knew, or should have known, the buyers to be sufficiently poor credit risks they could not obtain financing. When February 15, 1983, passed without the scheduled closing taking place by reason of default on the port of the buyers, Mrs. Houser, on February 18, 1983, wrote to Respondent (Exhibit 5) requesting the earnest money deposit as liquidated damages and a release from the listing agreement which she had been promised. In response thereto, Respondent, by letter dated February 24, 1983 (Exhibit 6), advised Mrs. Houser that the buyers' $500 check was no good and that they had failed to put up the additional $1,500 required by the contract. He agreed to cancel the listing agreement `as soon as this matter is resolved." Mrs. Houser then reported the entire transaction to the Florida Real Estate Commission and these proceedings followed their investigation.
Findings Of Fact At all times pertinent to the allegations contained herein, the Respondent, Division of Real Estate, was the state agency responsible for the licensing and regulation of real estate professionals in Florida. Petitioner was a licensed real estate salesperson in Florida whose license was listed with Horizon Appraisal Service, Inc. in Ft. Myers. In October, 1989, Clyde H. Ward applied to Goldome Realty Credit Corporation for a $40,000.00 fixed rate mortgage on his property located in Ft. Myers. On October 5, 1989, Goldome sent Mr. Ward a commitment letter for a mortgage initially described as a 30 year fixed rate mortgage, but which was, five days later, amended to a 15 year fixed rate mortgage at 10%, conditioned upon, among other things, a satisfactory appraisal. Consistent therewith, Goldome thereafter contacted its regular appraiser in the area, Horizon Appraisal Service, Inc., and requested that an appraisal of the property be accomplished. Horizon assigned the Petitioner, Ms. Wilcox, to conduct the appraisal. The original first page of her report indicated the property was a manufactured house with a crawl space, not situated on a slab. In reality, however, as was noted on the amended first page of the report, as of October 9, 1989, the property was not a manufactured house and was situated on a concrete slab without a crawl space. Goldome denied a fixed rate mortgage to Mr. and Mrs. Ward but offered them a one year adjustable rate mortgage. The Wards accepted this change under protest. A formal denial of the fixed rate mortgage was sent to the Wards on December 18, 1989 by a form which indicated that their application for the fixed rate mortgage had been denied for (1) inadequate collateral, and (2) "we do not grant credit to any applicant on the terms and conditions you request." The "inadequate collateral" basis for denial noted, however, that a mortgage had been offered, accepted and closed with the Wards under an adjustable rate bank loan. On February 16, 1990, Mr. Ward wrote to Goldome expressing his concern over the denial of the fixed rate loan and the basis for denial. In response to Mr. Ward's letter, on March 7, 1990, Mr. Krohe, Goldome's vice president for residential lending, wrote to Mr. Ward and clearly stated that Goldome's denial of the fixed rate mortgage was based on several areas in the appraisal that caused concern. Mr. Krohe specifically pointed out that the fact that the property was described in the appraisal as being a "mobile home" was not the only reason for denial. In his testimony, Mr. Krohe cited several other reasons for denial. One was that the appraiser indicated that the predominant value of homes in the neighborhood was $35,000.00 and Mr. Ward's application was for a mortgage in excess of that. It is Goldome's policy typically to not make a loan in excess of the predominant value since there would be no way to sell the loan in the secondary market. In addition, comments on the appraisal indicated that homes in the area were a mixture of mobile homes and small CBS or frame houses located on paved and graveled roads, and the homes in the neighborhood reflected average maintenance. The zoning classification for the property was MH-3, which permits mobile home use on the property. Further, the room sizes and layout was indicated as "fair to average" and the appraiser pointed out an incurable functional problem with the room layout. This problem related to the fact that the only full bathroom in the house was located between the master bathroom and the second bedroom and could be reached only through one of those rooms. Further, the appraiser indicated there were no recent sales similar to the subject property in the neighborhood and those sales which were comparable were noted to have superior construction and functional utility. Mr. Krohe pointed out that not one of those concerns by itself necessarily would have caused the fixed rate mortgage applied for to be declined. He notes, however, that underwriting is not a science, and all of those reasons combined caused the underwriter to decline the loan. Notwithstanding his receipt of this letter, Mr. Ward filed a complaint with the Division of Real Estate which was referred to Investigator John Harris for inquiry in March, 1990. During the course of his investigation, Mr. Harris spoke only with the Petitioner, Ms. Wilcox, and with Mr. Ward. On or about March 22, 1990, he met with Petitioner at her place of business, Horizon Appraisal Service. During the course of that interview, Ms. Wilcox admitted she had made a mistake on the first page of the appraisal report whereon the property w as described as a manufactured home situated on a crawl space without a slab. She indicated she had corrected the form as soon as she found out about the mistake, occasioned not by a written description but by check marks to pre- printed descriptions which were to be marked if appropriate. The work was done by typewriter, not by pen. Mr. Harris also interviewed Mr. Ward, but did not interview anyone else during his entire investigation even though Ms. Wilcox pointed out that information she had from Ms. Selph and Mr. Krohe indicated that the declination of the loan was not primarily based on this erroneous information. In fact, Ms. Wilcox requested that Mr. Harris contact both Selph and Krohe to verify this but he chose not to do so, relying instead on the information provided to him by Mr. Ward and the March 7, 1990 letter from Krohe to Ward which he interpreted as indicating the denial was based on the description of the property as a "mobile home." That letter does not so indicate, however, and clearly shows that any such classification was not the sole basis for denial of the loan. Notwithstanding this, Mr. Harris considered the fact that Ms. Wilcox admitted to making the mistake as tantamount to an admission of culpable negligence and he recommended that action be taken against her. Thereafter, the matter was referred to a probable cause panel of the Real Estate Commission which, on May 15, 1990, considered the allegations against Ms. Wilcox and, after a review of the file and a presentation by a counsel to the Board, found probable cause. Review of the transcript of the probable cause panel as it relates to Ms. Wilcox reveals that even there, the case was inaccurately described to the panel by its counsel who claims that, "the loan was rejected on the basis of the appraisal which incorrectly described the structure as a manufactured house with a crawl space and no slab." Counsel completely omitted any mention of any of the other bases for denial which were described by Mr. Krohe in his deposition of which the Department was notified but declined to attend, and which could have been determined by an appropriate investigation into the matter. The discussion by the panel members, as documented in the transcript of its meeting, in no way related to the particulars of the alleged misconduct but instead concerned itself primarily with the status of the appraiser. In short, it is clear that the probable cause panel's finding of probable cause was based only on its review of the completely inadequate investigation by Mr. Harris and the slanted comments of the panel's counsel. Nonetheless, an Administrative Complaint was filed against the Petitioner which alleged culpable negligence, breach of trust and misrepresentation and concealment. Prior to the hearing, the Board dismissed the allegation of misrepresentation and concealment. A hearing was conducted on the remaining counts on October 11, 1990 in Ft. Myers before H.O. Parrish. In her Recommended Order dated December 12, 1990, Ms. Parrish concluded that the Department had failed to establish the Respondent committed any misconduct; that Ms. Wilcox had accurately described and evaluated the home within customary ranges; and that the lender verified the reasons for denial of the requested mortgage were not related to the typographical errors pertaining to the type of home, the crawl space, and the slab. Ms. Parrish thereafter recommended a Final Order be entered by the Commission dismissing the Administrative Complaint and such an Order was entered. By Motion dated March 4, 1991, Petitioner's counsel sought reimbursement for the Petitioner of attorney's fees and costs relating to her defense against the allegations made against her in the Administrative Complaint. Respondent has stipulated that the amount claimed for the original representation is reasonable as to both hours claimed and fee per hour. It claims, however, that fees and costs are not reimbursable here because, (1), Petitioner is not a small business entity, and (2), the Division had probable cause to initiate the Administrative Complaint. Petitioner has also submitted an additional affidavit, subsequent to the hearing, in which she claims 7.1 additional hours, at $110.00 per hour, for services rendered subsequent to the final hearing in the original action. Petitioner claims to be an independent contractor to Horizon Appraisal Service, Inc.. She works strictly on commission. She has a desk at the Horizon office and keeps almost all her business information there. She has no other office. She cannot do appraisals for other brokers because she can work for only one broker at a time. She claims to be licensed as an appraiser in Florida but the licensure information on file with the Department of Professional Regulation as of September 4, 1990, reflects she is licensed only as a real estate salesman. By affidavit dated December 6, 1985, and attached to the Independent Contractor Agreement of equal date, Petitioner outlines her working conditions with Horizon. She pays all her own license fees and dues; she is responsible for her own auto and transportation expenses; she pays all her client development costs without reimbursement; she is not required to maintain any set working hours; she takes vacations when she pleases; she is not required to meet any quotas; she receives no minimum salary, sick pay or other fringe benefits; she pays her own income and FICA taxes; and the association with the broker may be terminated by either party at any time. Under the terms of the Agreement referenced above, Petitioner is to get 45% of the fee charged by Horizon for the appraisal done by her. Any lawsuits for the collection of appraisal fees must be maintained only in the name of the Broker, however, since the appraiser is considered to be a subagent. Though the appraiser may conduct the actual appraisal, the Agreement requires that these completed appraisals be submitted to the broker for review, and Mr. Krohe, of Goldome, indicated that his institution would accept only appraisals signed by the broker, not the appraiser. The agreement also stipulates that all clients brought in by the appraiser will result in an additional 10% fee split, and will remain clients of the broker upon termination of the agreement. Notwithstanding the appraiser can take vacations when desired and work when she pleases, she must, however, notify the broker a minimum of two weeks in advance of vacation time and call in on days when she will not be available. The appraiser agrees to a five day turnaround on appraisals, may not solicit listings for the transfer of property other than owned by her, and, significantly, may perform her services only for this broker, Horizon Appraisal Services, Inc.,
Findings Of Fact Petitioner is the state licensing and regulatory agency charged with the responsibility and duty to prosecute administrative complaints pursuant to Section 20.30, Florida Statutes and Chapters 120, 455 and 475, Florida Statutes and rules promulgated pursuant thereto. Respondent, David J. Zachem, is now, and was at all times material hereto, a licensed real estate broker in Florida, having been issued license number 0194936. The last license issued was as a broker c/o Sunstate Tax Consultants, Inc., 220 East Madison Street #512, Tampa, Florida, Respondent, during times material, was licensed as a broker/salesperson with Gary Levone Hall, t/a Gary L. Hall & Associates, 243 Timberland Avenue, Longwood, Florida. On or about July 24, 1991, the Resolution Management Associates, Inc. of Atlanta, Georgia, engaged Henry Mazas, the principal of H.R. Mazas & Associates, an accounting firm to perform an appraisal of real property located in Seminole, Florida (called Seminole Landing) which was owned or controlled by the Federal Resolution Trust Corporation, the federally affiliated agency which is selling off failed savings and loan associations financed or mortgaged properties. While Respondent was licensed as a broker/salesperson with Hall, Mazas engaged Respondent to assist in the appraisal of the Seminole Landing property. Respondent assisted Mazas by doing what is commonly referred to in the trade as the "leg work" such as visually inspecting the property, reviewing public records, compiling comparables and other raw data which was utilized by Mazas in completing his appraisal. Respondent signed on the appraisal letter evidencing his assistance as a consultant who assisted Mazas in completing his appraisal. C.W. Marlow, contracts manager of Resolution Management Associates, received a bill from Mazas for the appraisal service in the amount of $4,830.00, which amount was paid to Mazas on or about October 29, 1991. Mazas deposited the check into his account and thereafter paid Respondent $2,321.11 via a check dated November 5, 1991. On November 8, 1991, Respondent and his wife, Patricia Zachem, endorsed the check for payment. At the time that Respondent assisted Mazas in compiling the raw data to complete his appraisal, Mazas was unaware of Respondent's affiliation with Gary Hall. Respondent signed off on the appraisal to fully disclose to everyone concerned that he consulted with Mazas in compiling the raw data for the appraisal. Gary L. Hall, is a licensed real estate broker since approximately 1982. Hall has known Respondent since 1988. They are friends who assist and consult with each other primarily about political activities. Respondent placed his license with Hall as a matter of convenience and was never active in either buying, leasing or selling real property to the public. Respondent and Hall had no agreement respecting the splitting of fees that Respondent would earn for commissions that he received. According to Hall, Respondent "would have been able to keep the entire commissions that he receive for any work that he performed." Hall knew that Respondent was active in preparing appraisals when he became affiliated with his agency. Respondent is the holder of a real estate salesman's license since 1978 and a broker since 1979. Respondent while licensed as a broker, joined the Pinellas County Property Appraiser's Office. Respondent has been employed in two county property appraiser's offices (Broward and Pinellas counties). Respondent was a senior deputy in Broward County with his employment commencing sometime in 1981. He was so employed until January 1989 when he was employed by Pinellas County. In Pinellas County, Respondent was the chief deputy and the chief appraiser. Since 1980, Respondent has principally been a "mass appraiser" while working in Broward and Pinellas counties. Respondent is the qualifier for Sunstate Tax Consultants, which he is the president. Respondent is a Certified Florida Evaluator (CFE). To be qualified as a CFE, one must have worked in a property appraiser's office in the mass appraisal element for a period in excess of two years and have successfully passed four appraisal courses which are designated courses. Specifically, these courses are income to evaluation, the mechanical application of appraisals, appraisal assessment jurisdiction and vacant land. After successfully completing these courses, the property appraiser for whom the applicant is employed writes a letter of recommendation to the certification committee of the Department of Revenue. That committee reviews the applicant's qualifications and either grant or deny the CFE certificate. Respondent primarily placed his real estate license with Hall such that he could qualify as an expert in the numerous petitions filed with the Value Adjustment Board where the evaluation of properties are subject to litigation. Those appraisers who have an active broker license is an indication that they are fully qualified in the appraisal and real estate business. Respondent, as stated, never engaged in the typical brokerage business of buying, selling, leasing or renting property to the public. Specifically, Respondent's understanding with Hall was that if he engaged in any business that was governed by Petitioner, Hall would be notified. Respondent was never engaged to conduct an appraisal or to act as an appraiser for Mazas or the Resolution Management Associates. Respondent would have so advised Hall had he been involved in such a relationship or any activity that was governed by Chapter 475, Florida Statutes. Eugene Davidson, an ad valorem tax consultant. was tendered and received as an expert appraiser. Davidson was one of three founders that founded the National Society of Fee Appraisers more than 35 years ago. Davidson holds a senior designation as an ASA member. Davidson is a member of the Institute of Real Estate Management and hold the designation as a certified property manager (CPM). Davidson is certified with Florida as a general real estate appraiser. Davidson was a professor at the University of Miami, the University of Florida and in the Bahamas (Nassau and Freeport). Davidson knows Respondent as a person on high morals and integrity and who is knowledgeable in real e stte and appraisinng. Davidson has known Respondent more than twelve years. An appraisal is the act or process of estimating value, or an opinion of value. Consulting is the act or process of providing information, analysis of real estate data and recommendations or conclusions on diversified problems in real estate other than estimating value. Respondent's engagement, to compile raw data, was as a consultant. He was not engaged, nor did he offer an opinion of value or an estimate of value. It is normal industry practice for consultants to sign appraisals when they provide or otherwise furnish significant information to the appraiser and, in doing so, complies with standard 2-3 of Chapter 475, Part II. See Sections 475.611 and 475.624, Florida Statutes.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that: Petitioner enter a Final Order dismissing Counts I-IV of the Administrative Complaint filed herein. 1/ DONE and ORDERED this 31st day of March, 1993, in Tallahassee, Leon County, Florida. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 31st day of March, 1993.
