The Issue Whether respondent committed the acts alleged in the Administrative Complaint, and, if so, whether respondent's license should be revoked, suspended or otherwise disciplined.
Findings Of Fact At all times pertinent to the charges, Reynold Diaz was a licensed real estate broker in the State of Florida, having license number 0379909. The respondent was registered under the trade name of "Progressive Developers" from August 20, 1983 to July 25, 1986. Respondent, in his capacity as a real estate broker, managed four rental units owned by John H. Stephen located at 3405-3407 Nebraska Avenue, Tampa, Florida. Mr. Stephen initially met Mr. Diaz when Mr. Stephen purchased the rental properties from him in 1984, and Mr. Stephen retained respondent to manage the properties at a fee of ten percent of the monies collected. At the end of April, 1985, respondent rented one of the units owned by Mr. Stephen to Ms. Roslyn Thompson. During the course of Ms. Thompson's tenancy, the respondent received from Ms. Thompson a total of $630.00, which represented two months rent and a security deposit of $180.00. None of this money was returned to Ms. Thompson and none of it was delivered to Mr. Stephen by respondent. When Mr. Stephen inquired about the rental money from the unit, in June or July of 1985, Mr. Diaz advised Mr. Stephen that the tenant had not paid her rent for a couple of months. Thereafter, Mr. Stephen went to the rental unit to talk to Ms. Thompson about her payments. Ms. Thompson advised Mr. Stephen that she had paid her rent and produced receipts for the $630.00 which she had paid to respondent. Mr. Stephen terminated respondent's services in June of 1985. In September of 1985 Mr. Stephen met with Mr. Diaz in an attempt to obtain an accounting of the monies received by respondent from Mr. Stephen's tenants. Although respondent had provided monthly statements and payments to Mr. Stephen throughout 1984, respondent stopped providing statements in 1985. Thus, Mr. Stephen had not received a statement in April, May, or June of 1985. When Mr. Stephen met with respondent in September, respondent failed to provide a full accounting of the money he had received from Mr. Stephen's tenants and failed to deliver the money he had received. However, subsequent to the meeting, Mr. Stephen did receive from respondent the amount he was owed on two of the rental units. However, respondent failed to deliver the money he had received from Ms. Thompson. Respondent contends that of the $630.00 he received from Ms. Thompson, he paid Mr. Stephen $225.00 in September and then paid the $405.00 balance in two installments. However, the evidence does not support this contention, and I accept Mr. Stephen's testimony that he never received any rent payments on the Thompson unit. Further, although the evidence does show that respondent paid Mr. Stephen $405.00 in two checks, these payments were for the money owed on the other rental units. Mr. Diaz has failed to account for or deliver to Mr. Stephen the $630.00 received from Ms. Thompson. Respondent, in his capacity as a real estate broker, also managed rental property owned by Sandra K. Nelson located at 1208 East Chelsea Street, Tampa, Florida. Ms. Nelson first met Mr. Diaz when she purchased the rental property, and she retained respondent to manage the property at a fee of ten percent of the monies collected. In August of 1984, the respondent rented the Nelson property to Joseph Ira Pasco. At the time of renting the unit, the respondent received from Mr. Pasco a security deposit of $325.00. However, Mr. Diaz advised Ms. Nelson that Mr. Pasco had not paid his security deposit, and withheld $275.00 from a rental payment to hold as a security deposit. Subsequently, after Ms. Nelson started eviction proceedings, she discovered that Mr. Pasco had a receipt signed by Mr. Diaz for a $325.00 security deposit. However, despite Ms. Nelson's demands, the respondent failed to deliver to Ms. Nelson the $325.00 security deposit or any portion thereof. Further, the security deposit was not returned to Mr. Pasco. However, respondent did ultimately deliver to Ms. Nelson the $275.00 that he had retained from the rental payment. Respondent maintained an escrow account at the Hay Gulf Federal Credit Union from August 8, 1984 until November 26, 1984, when the account was closed. When petitioner's investigator, Leo Huddleston, requested of the respondent all documentation associated with the Stephen and Nelson transactions, respondent produced the carbon copies of three deposit slips and twenty checks drawn on the Bay Gulf account. The documents covered only the months of September and October of 1984, and none of the documents appear to be connected to the Stephen and Nelson transactions. The respondent failed to produce his real estate brokerage escrow account statements, his business records, leases, contracts or other documentation required to be kept by the respondent and produced to the petitioner upon request. At no time did respondent place or maintain the $325.00 security deposit on the Nelson property in an escrow or trust account. Further, since respondent's escrow account was closed at the times respondent collected the rent money and deposit from Ms. Thompson, it is apparent that none of the $630.00 was placed in an escrow or trust account. Respondent admitted that he did not properly handle the funds received from the Nelson and Stephen properties, stating that he managed the properties on the basis of friendship rather than a professional basis. However, he did admit retaining ten percent of all the money collected. From August 20, 1983, until July 25, 1986, the respondent was registered with the Real Estate Commission under the trade name "Progressive Developers." However, at various times during this period, the respondent transacted business both as "Progressive Real Estate Developers" and "Progressive Real Estate Developers, Inc." These names were not registered with the Real Estate Commission.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Florida Real Estate Commission enter a final order suspending respondent's license for a period of two (2) years and imposing an administrative fine of $1,150 to be assessed as follows: Counts I and VI, $200 for each count; Counts II and VII, $200 for each count; Counts III and VIII, $100 for each count; Count IV, $100; and Count V, $50. Respectfully submitted and entered this 9th day of March, 1987, in Tallahassee, Florida. DIANE A. GRUBBS 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 9th day of March, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NO. 86-3775 Petitioner's Proposed Findings of Fact: Accepted in paragraph 1. Accepted in paragraph 2. Accepted in paragraph 3. Accepted in paragraphs 5 and 6. Accepted in paragraph 7. 6-7. Accepted in paragraph 8. Accepted generally in paragraphs 6 and 8. Accepted in paragraph 10. Accepted in paragraph 9. Accepted in paragraph 11. Respondent's Proposed Findings of Fact: Accepted that respondent managed Mr. Stephen's property. Second sentence rejected as irrelevant; further, the evidence established that Mr. Stephen first met Mr. Diaz when Mr. Stephen purchased the subject property from Mr. Diaz and retained him to manage it. Third sentence accepted in paragraph 10. Fourth sentence rejected as to the money received from Ms. Thompson, but accepted that money was delivered to Mr. Stephen in paragraph 6. Last sentence rejected as not a finding of fact. Accepted that $275 was paid to Ms. Nelson in paragraph 8; however, reject by contrary finding that the $275 payment was partial payment on the $325 security deposit. Reject, for lack of any evidence that improper name registration was computer error. Remainder rejected as not findings of fact. COPIES FURNISHED: James R. Mitchell, Esquire Harold Huff, Executive DPR - Division of Real Estate Director 400 West Robinson Street DPR - Division of Real Estate Orlando, Florida 32802 400 West Robinson Street Orlando, Florida 32802 Reynold Diaz 7908 N. Florida Avenue Tampa, Florida 33604
Findings Of Fact Kenneth W. Schneegold is a licensed real estate broker holding license no. 0078270 issued by the Department of Professional Regulations in the Division of Real Estate. The Respondent was president of Atlantis Properties, Inc., Florida Corporation. Atlantis Properties, Inc., and the Respondent were developers of a condominium to be built and known as Presidential Estates located in St. Petersburg, Florida. On or about January 10, 1981, Daniel K. Cullinan and J. Kent Staley entered into a written Reservation Agreement with Atlantis Properties, Inc., and the Respondent, as president, to reserve a unit within Presidential Estates. Pursuant to the Reservation Agreement a deposit of $1,000.00 was paid to ERA Kent Warren Realty in the form of a check received by the Respondent. The Reservation Agreement specified that the $1,000.00 deposit was to be held in the ERA Kent Warren Realty escrow account. The $1,000.00 deposit was paid in the form of a check signed by Daniel K. Cullinan on January 10, 1981. The deposit was placed into the escrow account of ERA Kent Warren Realty in the Pinellas Bank in St. Petersburg, Florida, on or about January 12, 1981. ERA Kent Warren Realty is the name under which the Respondent trades and the ERA Kent Warren Realty escrow account is the escrow account of the Respondent. This escrow account was maintained by the Respondent in his capacity as real estate broker. Pursuant to the terms of the Reservation Agreement, the $1,000.00 deposit was to be returned to the prospective buyer if one of the following occurred: In the event that the Agreement was terminated, the buyer would be entitled to an immediate and unqualified refund of reservation deposit. Said agreement could be terminated by the buyer upon written request at any time prior to the execution by the parties of a Purchase Agreement. The written notice was to be delivered by certified mail. The Agreement was also to terminate and the deposit would be returned if, by the first anniversary date of the Reservation Agreement, the purchase agreement had not been entered into by the parties. More than one year after the signing of the Reservation Agreement a purchase agreement had not been entered into by the parties. Cullinan made verbal demands upon the Respondent for return of his $1,000.00 deposit on several occasions. The Respondent did not account or deliver the $1,000.00 deposit to Cullinan. Cullinan sent a certified letter to the Respondent terminating the Reservation Agreement and requesting return of the $1,000.00 deposit. This written request was made on or about January 22, 1983. The certified letter was returned to Cullinan as unclaimed by the Respondent. The Respondent acknowledged that he was aware of Cullinan's request for the return of the $1,000.00 and also aware of his written request for the return of the $1,000.00 deposit. The Respondent communicated with Staley who did not demand termination of the agreement and return of the money from the Respondent. During the time from January 25, 1982, through February 28, 1983, prior to the return of the $1,000.00 deposit to Cullinan, the ERA Kent Warren Realty escrow account fell to a balance below $1,000.00 on no less that 16 occasions. The Respondent admits that his escrow account did fall below $1,000.00 on several occasions during the above mentioned time period. Cullinan nor Staley never gave their consent to the removal or use of the $1,000.00 deposit for any purpose other than those specified in the agreement. After complaint was lodged with the Division of Real Estate, the Respondent under compulsion from the Real Estate Commission paid the $1,000.00 deposit to Cullinan.
Recommendation Having found the Respondent guilty of violation Section 475.25 (1)(k), Florida Statutes, by failing to maintain monies in his escrow account properly it is recommended that the Respondent's license as real estate broker be suspended for a period of three months and that he be fined a sum of $1,000.00. DONE AND ORDERED this 27th day of November, 1984, at Tallahassee, Florida. STEPHEN F. DEAN 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 27th day of November, 1984. COPIES FURNISHED: James R. Mitchell, Attorney for Petitioner DPR-Division of Real Estate 400 W. Robinson St. P.O. Box 1900 Orlando, Florida 32802 Mr. Kenneth W. Schneegold 11360 Fourth Street, East Treasure Island, Florida 33706 Mr. Harold Huff Director, Division of Real Estate Department of Professional Regulation 400 West Robinson Street Orlando, Florida 32801
The Issue The issue for determination at the final hearing was whether the Respondent violated the real estate licensing law, as alleged in the Administrative Complaint, by failing to account and deliver a deposit; failing to maintain a deposit in a real estate brokerage escrow account or some other proper depository until disbursement thereof was properly authorized; and/or being guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, and/or breach of trust in a business transaction.
Findings Of Fact Based on my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, I hereby make the following findings of fact: Respondent is now, and was at all times material hereto, a licensed real estate broker in the State of Florida having been issued license number 0360741. The last license issued was as a broker, c/o Consolidated American Realty Services, Inc., in Tampa, Florida. From June 6, 1983, through June 25, 1984, Respondent was licensed and operating as a real estate broker under the trade name, "Benjamin Realty," in Tampa, Florida. For sometime prior to June 2, 1984, Eileen Cumbie attempted to sell a lot owned by her located at 1102 26th Avenue, Tampa, Florida. On June 2, 1984, the Respondent contacted Ms. Cumbie and informed her that he had a client interested in purchasing the property. Ms. Cumbie informed the Respondent that as long as she netted a certain amount, she would be willing to sell the property. Ms. Cumbie allowed the Respondent to put together a contract for the sale of the lot. In connection therewith, the Respondent prepared a sales contract with Danilo Castellanos, as purchaser, and Eileen W. Cumbie, as seller, for the purchase and sale of the property. Pursuant to the purchase and sales agreement, the Respondent received in trust from Mr. Castellanos a $500 earnest money deposit via check dated June 2, 1984. On June 5, 1984, the Respondent deposited the check into his real estate brokerage account maintained at the Central Bank of Tampa, 2307 W. Rennedy Boulevard, Tampa, Florida. Mr. Castellanos entered into the contract for the benefit of his son and daughter-in-law who resided in New Jersey but were planning to relocate to the Tampa area. Mr. Castellanos' daughter-in-law went to look at the lot on June 10, 1984 and decided that she did not like the area in which it was located. The closing of the transaction was set for June 15, 1984. On approximately June 13, 1984, Mr. Castellanos' daughter- in-law informed the Respondent that they were no longer interested in purchasing the property. Ms. Cumbie was out of town during the time of the scheduled closing, but had prepared and signed all of the paperwork in advance. When she returned after June 15, 1984, she called Respondent to find out how the closing went. The Respondent informed her that the buyers failed to go through with the transaction. The contract provided in part as follows: ". . . If the buyer fails to perform this contract within the time specified herein, time being of the essence of this agreement, the deposit made by the buyer shall be disposed of in the following manner: To the Broker an amount equal to his earned commission, but not to exceed 1/2 of the deposit which shall discharge the sellers obligation to him for that service; remainder to the seller to be credited to him against his damages accrued by reason of the breach of contract. " After the transaction failed to close, Ms. Cumbie requested that Respondent give a portion of the deposit to her. The Respondent told Ms. Cumbie that he would give her the entire deposit because she had paid for the survey and a few other items to facilitate the closing of the transaction. Over the next several months, the Respondent, on several occasions, promised to deliver a check to Ms. Cumbie. However, the Respondent never delivered any such check to Ms. Cumbie. Because the Respondent failed to provide Ms. Cumbie with a share of the earnest money deposit, she initiated a civil action in the County Court of Hillsborough County. On October 15, 1985, Ms. Cumbie was awarded a final judgment in the amount of $250 against Respondent for her share of the forfeited earnest money deposit. As of the date of the final hearing, the Respondent had not satisfied the judgment and Ms. Cumbie had not received any proceeds from the forfeited earnest money deposit. Shortly after the transaction failed to close, the purchasers requested that the Respondent return the earnest money deposit to them. However, the Respondent informed them that they were not entitled to the return of the earnest money deposit. The earnest money deposit was never returned to the purchasers. On July 31, 1984, the balance in Respondent's escrow account was $568.83. However, on September 1, 1984, the balance in the Petitioner's escrow account fell to S18.83. From October 31, 1984 to January 1, 1986, the balance in the Petitioner's escrow account remained $3.83.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is therefore, RECOMMENDED that the registration of Fortunato Benjamin- Pabon as a real estate broker be revoked. DONE and ORDERED this 18th day of June, 1986, in Tallahassee, Florida. W. MATTHEW STEVENSON, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 18th day of June, 1986. COPIES FURNISHED: Arthur R. Shell, Jr., Esquire Department of Professional Regulation 400 W. Robinson Street Orlando, Florida 32801 Fortunato Benjamin-Pabon 2729 N. Ridgewood Avenue, #1 Tampa, Florida 33602 Harold Huff, Executive Director Department of Professional Regulation Division of Real Estate P. O. Box 1900 Orlando, Florida 32802 Fred Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Salvatore A. Carpino, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
Findings Of Fact The Department is a state licensing and regulatory agency charged with the responsibility and duty to prosecute Administrative Complaints pursuant to the laws of the State of Florida, in particular, Chapters 120, 455 and 475, Florida Statutes (1991), and the rules promulgated pursuant thereto. The Respondents, Shirley M. Ferguson and Dosh Realty, Inc., are now, and were at all times material hereto, licensed real estate brokers in the State of Florida, having been issued license numbers 0393921 and 0252372, respectively, in accordance with Chapter 475, Florida Statutes. The last licenses issued were as brokers, c/o Dosh Realty, Inc., 595 N. Nova Road 105A, Ormond Beach, Florida 32174. At all times material hereto, Ms. Ferguson was licensed and operating as qualifying broker and officer of Dosh Realty, Inc. On or about August 1, 1990, Ms. Ferguson maintained and operated a branch office of Dosh Realty, Inc., at the Aliki Condominium located in Daytona Beach. On or about August 1, 1990, Ms. Ferguson and Carol Savage, a licensed salesperson, entered into an "Independent Contractor Agreement" whereby Ms. Savage agreed to act as a property management agent for Dosh Realty, Inc., at the Aliki Condominium. Ms. Savage's license was registered with Dosh Realty, Inc. The Independent Contractor Agreement between Ms. Ferguson and Ms. Savage specifically required that Ms. Savage set up "two rental accounts - Dosh Realty, Inc./ (condo name) - one account to be a general account for rentals, the other account to be a non-interest escrow account for security deposits." On August 1, 1990, Ms. Ferguson opened an account, number 1130222031, at Barnett Bank in Ormond Beach, Florida. Ms. Ferguson and Ms. Savage were signatories on the account. The account was not an escrow security account. Ms. Ferguson inquired of Ms. Savage about a rental escrow account for Aliki Condominium. Ms. Savage informed Ms. Ferguson that security deposits were not required or received and, therefore, no escrow account was necessary. Despite the requirement of the Independent Contractor Agreement that an escrow account be established, Ms. Ferguson did not require that Ms. Savage comply with the terms of the Independent Contractor Agreement. Between August 1, 1990, and July 20, 1991, Ms. Savage, in the course of her association with the Respondents, solicited and obtained tenants to lease condominium units at the Aliki Condominium. Ms. Savage informed Ms. Ferguson that the agreements for these rentals were verbal. Ms. Ferguson did not insist that written agreements be entered into. Between August 1, 1990, and July 20, 1991, Ms. Savage in fact received monies as security deposits for rentals at the Aliki Condominium. Not all of the monies received by Ms. Savage were deposited in an account of the Respondents. Respondents were not notified of the security deposits and the Respondents were not aware that the security deposits had been collected. On July 20, 1991, Ms. Ferguson became aware that Ms. Savage had been collecting security deposits from tenants of the Aliki Condominium. Ms. Ferguson learned that Ms. Savage had taken the deposits and had failed to deliver the deposits to the Respondents. On or about July 20, 1991, tenants of the Aliki Condominium began to demand a return of their security deposits and Ms. Savage left the State of Florida. Ms. Ferguson reported the foregoing events to the Department and ultimately filed a complaint against Ms. Savage. Ms. Savage ultimately surrendered her license with the Department for revocation. The Respondents have not returned the security deposits received by Ms. Savage at the Aliki Condominium. Although Ms. Ferguson was very cooperative during the Department's investigation of this matter and although Ms. Ferguson did inquire of Ms. Savage concerning the manner in which rentals were handled at Aliki condominium, Ms. Ferguson did not insist, as a condition for the continued use by Ms. Savage of Ms. Ferguson's brokers license and the brokers license of Dosh Realty, Inc., that Ms. Savage use written rental agreements, require deposits and use an escrow account. Ms. Ferguson acknowledged during the investigation of this matter that monies were received at Dosh Realty's branch office at the Aliki Condominium that were not deposited in an escrow account and that she accepted Ms. Savage's representation that no written leases were entered into at the Aliki Condominium.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a Final Order finding that the Respondents have violated Sections 475.25(1)(b), (d) and (k), Florida Statutes (1991). It is further RECOMMENDED that Ms. Ferguson be reprimanded, placed on probation for one year and required to complete the 30 hour broker management course. DONE and ENTERED this day of July, 1992, in Tallahassee, Florida. LARRY J. SARTIN Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this day of July, 1992. APPENDIX Case Number 92-1990 The parties have submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph number(s) in the Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted. The Department's Proposed Findings of Fact Proposed Finding Paragraph Number in Order of Fact Number of Acceptance or Reason for Rejection 1 1. 2 2. 4 3. 5 4. See 5. See 8. 8 10. See 11. The exact amount of the deposits at issue was not proved by competent substantial evidence. Hereby accepted. 11 12. 12 13-14. 14 15. 15 See 17. The Respondents' Proposed Findings of Fact Proposed Finding Paragraph Number in Order of Fact Number of Acceptance or Reason for Rejection 1 1. 2 2. 3 3. 4 4. 5 5. 6 8. 7 11. See 9-10. 8 10-11. 9 12 and 13. The last sentence is not supported by the weight of the evidence and is not relevant. Although it is true that the exact monies Ms. Savage took were not received by the Respondents, they were responsible and could have returned monies of the Respondents. COPIES FURNISHED: Steven W. Johnson Senior Attorney Department of Professional Regulation Division of Real Estate Legal Section Hurston Building, North Tower #308 400 West Robinson Street Orlando, Florida 32801-1772 R. Michael Kennedy, Esquire Post Office Box 4319 South Daytona, Florida 32121 Jack Ray General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando Florida 32802-1900
Findings Of Fact At all times material to these proceedings, the Respondent McVety was a licensed real estate broker in Florida, having been issued license numbers 0461636 and 0258678. On January 1, 1989, the Respondent purchased the company Realty Services of Southwest Florida, Inc., a Florida corporation. One of the services provided by the corporation was property management. Rents and security deposits were collected from tenants of residential leases on behalf of property owners. In some cases, Respondent McVety was acting as an agent on behalf of property owners through the corporation. In other cases, Respondent McVety or the corporation was the actual property owner. When Respondent McVety took over the management of the corporation after his stock purchase, he noticed that the escrow account into which security deposits were placed, was a non-interest bearing account. On January 23, 1989, the escrow account was changed by the Respondent from an non-interest bearing escrow account to an interest bearing account. The tenants were not notified that their security deposits were now bearing interest. On March 17, 1989, a routine audit was conducted of the Respondent's escrow accounts. During the audit, it was discovered that one hundred and seventeen of the one hundred and thirty leases stated that the security deposits were being held in an non-interest bearing account. The leases which stated that the deposits were in an interest bearing account were signed after the Respondent purchased the corporation. The one hundred and seventeen leases with a non-interest bearing escrow were signed by the tenants prior to the stock transfer. There were no allegations that interest had actually been paid by the bank on the escrow account or that there had been any failure by the Respondent to account for the interest to the tenants, the actual owners of the funds. In mitigation, the Respondent stated that once he was made aware of the problems and truly understood the Department's concerns, a letter was sent to each tenant explaining the placement of the security deposits into an interest bearing escrow account on January 23, 1989. These letters were sent on April 3, 1989. In addition, a new real estate lease was prepared on behalf of the corporation by an attorney. The purpose of the new lease was to explicitly state the rights and responsibilities of the parties regarding the interest on these accounts. In this case, no one was cheated, no secret commissions were earned, and the sums in question were trifling.
Recommendation Accordingly, based upon the foregoing, it is RECOMMENDED: That the Respondent McVety be found guilty of having violated Rule 21V- 14.014, Florida Administrative Code, and is therefore in violation of Section 475.25(1)(e), Florida Statutes. This violation was originally Count II of the Administrative Complaint. Counts I and II, having been withdrawn, are dismissed. That the Respondent McVety be issued a written reprimand as the penalty for the one violation. DONE and ENTERED this 30th day of January, 1990, in Tallahassee, Leon County, Florida. Copies furnished: John R. Alexander, Esquire DPR - Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 John A. McVety 3120 Grand Avenue Fort Myers, Florida 33901 Darlene F. Keller Executive Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 VERONICA E. DONNELLY Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of January, 1990. Kenneth E. Easley, Esquire General Counsel Department of Professional Regulation 1940 North Monroe, Suite 60 Tallahassee, FL 32399-0792
The Issue The central issue in this case is whether Respondent is guilty of the violations alleged in the Administrative Complaint; and, if so, what penalty should be imposed.
Findings Of Fact Based upon the testimony of the witnesses and the documentary evidence received at the hearing, I make the following findings of fact: Respondent, Naomi N. Radcliff, is licensed in Florida as a real estate broker (license No. 0369173) and has been at all times material to the Administrative Complaint. On December 2, 1987, Respondent submitted a Request for License or Change of Status form which sought to cancel the license. Thereafter, the Department reclassified Respondent as an inactive broker. In July, 1986, Randy Mangold and his wife entered into a contract to purchase real property located in Indian River Estates. Naomi Radcliff was the real estate agent who handled the transaction on behalf of the Mangolds. The Mangolds' contract provided for occupancy prior to closing with a security deposit for the rental in the amount of $1500. This amount was paid to Respondent. At closing the $1500 security deposit was to be applied to the buyers' closing costs. The Mangolds rented the home for a year and attempted to obtain financing for the purchase. When their mortgage application was denied, they elected to vacate the property. After they vacated the property, the Mangolds requested the return of the $1500 security deposit. Demands were made on Respondent who refused to return the deposit despite the fact that the Mangolds had fully paid all rents owed and had left the house in good condition. Finally, the Mangolds sued Respondent in the St. Lucie County Court and obtained a judgment for the $1500 security deposit. Respondent has not satisfied the judgment. At one point Respondent did give the Mangolds a check for $500 which was returned due to insufficient funds in the account. In December, 1986, Respondent acted as a rental agent for Walter Zielinski, an out-of-state owner. Mr. Zielinski owned two houses in Port St. Lucie, one of which was located at 941 Fenway. In early December, 1986, Respondent advised Mr. Zielinski that the tenants had left the home at 941 Fenway and that the unit was in fairly good condition. Sometime later in the month, Mr. Zielinski discovered the house was empty but that it had been damaged. There were holes in the wall in the utility room approximately two feet in diameter. The flooring in the utility room and kitchen was ripped up. There was a hole in the wall in the master bedroom. More important to Mr. Zielinski, the house was unsecured because the garage door latch was broken and the house was accessible through the garage. After discovering the unit was at risk for additional damage, Mr. Zielinski attempted to contact Respondent but numerous calls to Respondent, her place of work, and to a former employer proved to be unsuccessful. Finally, Mr. Zielinski obtained another real estate agent to represent the 941 Fenway home. The new agent, Cathy Prince, attempted to obtain from Respondent the keys, the security deposit, and the rent money belonging to Mr. Zielinski. In January, 1987, Mr. Zielinski came to Florida from Illinois to take care of the rental problems. Mr. Zielinski incurred expenses totalling $876.74 to repair the damages to 941 Fenway. Also, Mr. Zielinski wanted to collect the rents owed by Respondent for his other property and have the security deposit for the second property transferred to the new agent. Respondent issued a personal check for the security deposit which was returned for insufficient funds. A second personal check paid to Mr. Zielinski for the rent owed was accepted and cleared. According to Mr. Zielinski, Respondent did not maintain an office where he could find her during the latter part of December, 1986 through January, 1987. In March, 1987, the security deposit for Mr. Zielinski's second rental was paid to the new agent. The check was issued by Respondent's mother. Respondent never personally returned any calls to the new agent. In June, 1986, Alyssa and Jeffrey Maloy entered into a contract to purchase a house. Respondent handled the real estate transaction for the Maloys. The closing was to be December 9 or 10, 1986. Respondent held monies that were required to complete the Maloy closing. Respondent attended the closing but the check tendered to the closing agent, Chelsea Title, was drawn on an trust account which had been closed. The closing agent discovered the problem and requested sufficient funds. Respondent left the closing and returned some hours later with new checks drawn on another account. After checking with the bank, it was again discovered that the funds in the account were insufficient to cover the amount needed for closing. Finally, some days later the Respondent's brother delivered a certified check to cover the amount needed to close the Maloy transaction.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Professional Regulation, Florida Real Estate Commission enter a Final Order suspending the Respondent's real estate broker's license for a period of five years. DONE and RECOMMENDED this 12th day of July, 1988, in Tallahassee, Florida. JOYOUS D. PARRISH 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 12th day of July, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-4631 Rulings on Petitioner's proposed findings of fact: Paragraphs 1-3 are accepted. With regard to paragraph 4, with the exception of the date referenced (November, 1986) the paragraph is accepted. Paragraph 5 is rejected a hearsay evidence unsupported by direct evidence of any source. The first sentence of paragraph 6 is accepted. The second sentence calls for speculation based on facts not in the record and is, therefore, rejected. Paragraphs 7-11 are accepted. With regard to paragraph 12, the first four sentences are accepted; with regard to the balance, the Respondent's brother did deliver funds to allow the Maloy transaction to close however the source of the funds is speculation based upon hearsay unsupported by the record. COPIES FURNISHED: Steven W. Johnson, Esquire Department of Professional Regulation, Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Darlene F. Keller, Executive Director Department of Professional Regulation, Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 William O'Neil, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Naomi N. Radcliff 1420 Seaway Drive Fort Pierce, Florida 33482
The Issue Whether Respondent violated provisions of chapter 475, Florida Statutes (2016),1/ regulating real estate sales brokers, as alleged in the Administrative Complaint; and, if so, what sanctions are appropriate.
Findings Of Fact The Department is the state agency charged with regulating the practice of real estate pursuant to section 20.165 and chapters 455 and 475, Florida Statutes. Ms. Murata is a licensed real estate broker in Florida, having been issued license numbers BK 3266198, 3326041, 3330594, 3334183, 3338731, 3345773, 3346456, 3346845, 3350300, 3364670, 3366527, 3366441, 3368235, 3369788, 3372663 and 3378303. Ms. Murata is under the jurisdiction of Petitioner and subject to applicable statutes and rules. Ms. Murata is the owner of the Florida Qualifying Broker of Record Service and maintains the Internet website, http://floridabrokerofrecord.com, which states its business model to be an opportunity for Florida real estate sales associates to run their own real estate companies without having to share their commissions with the broker of record. Friendly International Realty, LLC ("Friendly"), was formed in June 2011. From March 3, 2016, to June 7, 2016, Ms. Murata was the qualifying real estate broker for Friendly. Ms. Murata agreed to receive a monthly fee of $289.00 in exchange for being the qualifying broker of record for Friendly. Ms. Murata did not physically visit the license location of Friendly, at 937 Northeast 125th Street, North Miami, Florida, 33161, during the time that she was the qualifying broker. Ms. Murata was not a signatory on any escrow account used by Friendly. Ms. Murata did not keep any of Friendly's brokerage records. From March 4, 2016, to November 21, 2016, Jean Berthelot was a registered real estate sales associate with Friendly. He acted as an independent contractor. Ms. Murata was aware that Mr. Berthelot was doing business on the Multiple Listing Service ("MLS"). After she became the broker for Friendly, Ms. Murata activated one sales associate to help Mr. Berthelot. Joan Feloney is the owner of the subject property. Audrey Flanders is a real estate broker acting on behalf of Ms. Feloney in her efforts to lease the subject property. Ms. Flanders received a contract to enter into a lease from Tamara Stanton, a real estate sales associate at Friendly, on behalf of Paul Allicock. Ms. Feloney accepted the offer. Mr. Allicock paid $2,350.00 to Friendly toward lease of the subject property in the form of signed money orders dated March 6 and March 18, 2016. The money was placed in a Friendly escrow account. These money orders were paid to engage the services of Friendly and Ms. Murata as broker in the rental of the subject property. Pursuant to a written statement signed by Ms. Feloney, $550.00 of this amount was to be paid to Friendly, and $1,650.00 was to be paid to Ms. Feloney. A lease agreement between Mr. Allicock as tenant and Ms. Feloney as landlord and owner of the subject property was executed on March 21, 2016. Mr. Berthelot wrote a check from the Friendly escrow account to Ms. Feloney for $1,650.00 on the same date. Ms. Feloney attempted to deposit the check, but on April 14, 2016, the check was returned to her marked "NSF," indicating that insufficient funds were in the account. She was charged a $15.00 return item fee. Under the agreement between Ms. Murata and Friendly, Mr. Berthelot was not authorized to have an escrow account or otherwise hold funds or assets on behalf of a third party. As for brokerage transactions, he was supposed to e-mail transactional records to Ms. Murata or place them in a dropbox. Neither Ms. Stanton nor Mr. Berthelot ever placed documents in the dropbox. But, as Ms. Murata told Investigator Percylla Kennedy, she did learn that Friendly was doing business on the MLS. Ms. Murata became aware of the Friendly escrow account on April 26, 2016, in connection with a complaint about a transaction unrelated to this Administrative Complaint. She discussed the escrow account with Mr. Berthelot on April 27, 2016. Ms. Murata requested that Mr. Berthelot close the escrow account, submit proof that he had closed the account, and turn over all contracts between Mr. Berthelot and current clients. Ms. Murata did not want to perform a reconciliation of the escrow account. As she testified in deposition: Q: When you learned that there were third party funds being held by Friendly International Realty, did you demand the records of that account so you could perform a reconciliation? A: No, because [sic] was to be closed, because I did not want to manage an escrow account. So when I discovered what he was doing, the agreement was that he was going to close it immediately. I was not going to manage an escrow account for him, so I demanded, what I demanded was proof that the account was closed and proof that he had engaged in a written agreement with a title company for all escrow funds. Q: Approximately when did you make that demand? A: The moment that Jessica Schuller came up and he confessed that he had kept the account from his previous broker. That he had not told me because he was going to close it. I threatened I was going to resign once he paid those funds to Jessica. But then I agreed to continue if he closed that account immediately. On May 10, 2016, a complaint was filed with the Department against Ms. Murata, as broker of Friendly, regarding the lease transaction involving the subject property. After Ms. Murata became aware that Friendly owed money to Ms. Feloney, she maintained regular contact with her brokerage in an attempt to ensure that the money owed to Ms. Feloney was paid. Ms. Murata cooperated with the Department's investigation. Ms. Feloney, through Audrey Flanders, requested on June 2, 2016, that the $1,650.00 and an additional service charge of $82.00 be paid within 15 days or a case would be filed with the state attorney's office. The parties stipulated that on June 7, 2016, Ms. Murata resigned from her position as broker of record for Friendly. She testified that she resigned because she had not received the documents or actions that she had requested of Mr. Berthelot. Ms. Murata did not write a check to Ms. Feloney to pay the amount Friendly owed her because, with an investigation underway, Ms. Murata did not want it to be construed as an admission that she had personally collected funds from Mr. Allicock. She also evidently believed that since she had resigned, she was not professionally responsible for obligations that arose during the time that she had been the broker. Ms. Murata convincingly testified that in another, unrelated, situation, she became involved as the broker to resolve a potential dispute by ensuring that the party entitled to funds was paid. On June 25, 2016, a Bad Check Crime Report was filed with the Broward County State Attorney's Office. By letter dated June 8, 2016, the Department requested that Ms. Murata provide copies of monthly reconciliation statements; bank statements and records; and sales, listing, and property management files of Friendly. As Ms. Kennedy testified, Ms. Murata never provided those accounts and records to the Department, saying she did not have them. While Ms. Murata insists that any failure was only because Mr. Berthelot actively kept information from her, the parties stipulated that Ms. Murata failed to maintain control of, and have reasonable access to, some of the documents associated with the rental of the subject property. Mr. Trafton, an experienced real estate broker and expert in real estate brokerages, reviewed chapter 475; Florida Administrative Code Rule Title 61J; the deposit paperwork of Mr. Allicock; the Bad Check Crime Report; the investigative report; and the Administrative Complaint. He prepared an expert report to the Department. As Mr. Trafton testified, the usual and customary standard applicable to brokers is that they must promptly deliver funds in possession of the brokerage that belong to other parties. Mr. Trafton also testified that the standard of care applicable to a broker in supervising sales associates requires active supervision. He also testified that a broker must maintain the records of the brokerage. Mr. Trafton testified that in his opinion, Ms. Murata failed to meet these standards. Ms. Murata failed to promptly deliver funds to Ms. Feloney that were in possession of the brokerage. Ms. Murata failed to manage, direct, and control Real Estate Sales Associate Berthelot to the standard expected of a broker of record. She did not actively supervise him, instead relying completely on Mr. Berthelot and other associates to provide her any information she needed to know. Ms. Murata failed to preserve accounts and records relating to the rental or lease agreement of the subject property. Petitioner did not clearly show that Respondent was guilty of either "culpable negligence" or "breach of trust." As Investigator Kennedy testified, and as corroborated by cost summary reports maintained by the Department, from the start of the investigation of this complaint through September 14, 2017, costs incurred by the Department were $1,443.75, not including costs associated with an attorney's time.
Recommendation Upon consideration of the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Florida Real Estate Commission: Finding Maria Camila Murata in violation of sections 475.25(1)(d)1., 475.25(1)(u), and 475.25(1)(e) as charged in the Administrative Complaint; imposing an administrative fine of $2,250.00; imposing license suspension for a period of two months; and imposing costs related to the investigation and prosecution of the case. DONE AND ENTERED this 2nd day of January, 2018, in Tallahassee, Leon County, Florida. S F. SCOTT BOYD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 2nd day of January, 2018.
Recommendation Based on the foregoing Findings Of Fact and Conclusions Of Law, it is RECOMMENDED that the Florida Real Estate Commission enter a final order revoking the license of Respondent, Annette J. Ruffin, to be a real estate broker. RECOMMENDED this 27th day of May, 1987, 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 27th day of May, 1987.
