The Issue Whether Respondent committed the offenses set forth in the Notice to Show Cause and, if so, what action should be taken.
Findings Of Fact Petitioner is the state agency charged with regulating yacht and ship brokers and salespersons pursuant to Chapter 326, Florida Statutes. At all times material hereto, Respondent was a licensed yacht and ship broker salesman. He has been licensed since 1990. In December 1990, Respondent was issued license number 1322, as a yacht and ship broker salesman for Seafarer Brokerage, Inc. (Seafarer). In October 1998, he renewed his license, which had an expiration date of October 28, 2000. On July 31, 1997, Lorraine Woods, the President of Seafarer, wrote to Peter Butler, section head of the yacht and ship section of the Department of Business and Professional Regulation, notifying him that Respondent was the broker of record for Seafarer. Ms. Woods' license had been suspended, and Respondent knew that her license had been suspended prior to his becoming broker of record for Seafarer. As the broker of record, Respondent knew that he was solely responsible for safeguarding the money of all clients in the brokerage's escrow account. Respondent did not know the details involving the suspension of Ms. Woods' license. He was not aware that Ms. Woods had abused the control of Seafarer's escrow account for her own benefit by taking client funds from the escrow account to pay for Seafarer's operating expenses. Mr. Butler was very concerned with the abuse of Seafarer's escrow account committed by Ms. Woods. He demanded assurance from Respondent that Ms. Woods would not have access to the escrow account, and Respondent provided that assurance. On August 4, 1997, Respondent wrote to Mr. Butler confirming that he (Respondent) was the broker of record for Seafarer. In his written communication, Respondent confirmed certain details of the escrow account of Seafarer, including that he was broker of record and that the account was located at First Union National Bank of Florida, with the address and account number listed. Moreover, Respondent indicated that, as of July 30, 1997, he became the sole signatory on the account. Respondent personally provided the signatory card, showing that he was the sole signatory on the account, to the bank. Even though the bank did not have a record of such a signatory card, the undersigned is persuaded that Respondent's testimony is credible and that he provided the signatory card to the bank. Even though Respondent was the broker of record for Seafarer, Respondent looked upon Ms. Woods as the employer and himself as the employee, resulting in an employer-employee relationship. Seafarer consisted of two persons, Respondent and Ms. Woods. If Respondent was unavailable for a situation in which a check had to be written and executed, he would prepare a blank check with his signature on it and give it to Ms. Woods. She continued to maintain the business records. Ms. Woods maintained all the operating and escrow records, checks, and bank statements in a locked drawer for which she had the only key; Respondent did not have free and unobstructed access to these documents even though he was Seafarer's broker of record. Respondent and Ms. Woods continued this procedure for over a year without incident. On April 2, 1999, Warren Scott made an offer on a 1974 CAL2-46, a 46-foot yacht, with Seafarer. He placed a $6,000.00 deposit on the yacht. Mr. Scott's dealings, regarding the yacht, were with Ms. Woods. He had dealt with Seafarer and Ms. Woods on a prior occasion, had made a deposit, and had his deposit refunded. As a result, Mr. Scott felt comfortable dealing with Seafarer and Ms. Woods even though he had not purchased a yacht from Seafarer. On April 5, 1999, Mr. Scott's check was deposited in Seafarer's escrow account. On April 5, 1999, check numbered 1144, made payable to cash for $4,305.00, bearing Respondent's signature was written. The check bore the notation at the bottom left corner at the "FOR" space: "CAL2-46 (illegible) Enterprises." This check cleared Seafarer's escrow account on April 7, 1999, leaving a balance of $2,512.34. Respondent had signed the check and left it for Ms. Woods to fill-in the details. The check was signed by Respondent in March 1999 for a closing that was taking place at the end of March, but the check was not used at the closing in March. Ms. Woods had written the check to pay the rent for Seafarer. Even though Respondent had signed the check, the undersigned is persuaded that he did not know that Ms. Woods was going to use the check for a purpose other than for what it was written. On April 27, 1999, Respondent signed a check for $100.00, payable to Complete Yacht Service for engine repair to the CAL2-46. This check cleared Seafarer's escrow account on April 30, 1999, leaving a balance of $5,796.36. After a sea trial and survey, Mr. Scott wrote to Ms. Woods on April 30, 1999, indicating that he had decided not to purchase the 1974 CAL2-46 pursuant to their arrangement of April 2, 1999. On May 3, 1999, Mr. Scott again wrote to Ms. Woods that his offer to purchase the 1974 CAL2-46 for $55,000.00 in the conditional acceptance of vessel agreement, dated April 29, 1999, was expiring on May 3, 1999, at 9:00 p.m. Mr. Scott went to Seafarer on May 4, 1999, to obtain a refund of his deposit from Ms. Woods. Respondent informed him that Ms. Woods was out and that they would have to wait for her return, which was going to be in about an hour. Mr. Scott was unable to wait. He left Fort Lauderdale, returning to Nevada, with the understanding that his deposit, less $100.00 for the engine survey, would be returned to him. Mr. Scott expected the monies within a week to ten days. On May 5, 1999, a deposit of $4,700.00 was made to Seafarer's escrow account, leaving a balance of $9,136.36. On May 5, 1999, Seafarer's escrow account contained sufficient monies to give Mr. Scott a full refund of his deposit, less the $100.00. Respondent left for a vacation to the United Kingdom on May 17, 1999, with his return on June 15, 1999. Prior to his leaving, Respondent signed two blank checks, numbered 1153 and 1154, from Seafarer's escrow account. The checks were written for an upcoming business transaction during his absence, regarding a closing and Respondent's commission on the closing. On May 18, 1999, Seafarer's escrow account balance fell to $5,192.21, after three checks cleared the account. Two of the three checks, signed by Respondent, were payable to Seafarer in the amount of $1,360.00 for "comm.-37'Irwin." During May 1999, checks totaling $6,900.00, which were signed by Respondent, cleared Seafarer's escrow account. Mr. Scott made several telephone calls to Seafarer regarding the return of his deposit. Each time Mr. Scott spoke with Ms. Woods and he was not provided with a satisfactory response from her. On June 16, 1999, Mr. Scott received a check, check numbered 1153, for $5,900.00 from Seafarer. He also received a telephone call that same day from Ms. Woods requesting him not to deposit the check until the end of the month; Mr. Scott agreed. Respondent was not aware that check numbered 1153 was going to be used to refund Mr. Scott's deposit. Respondent was unaware that the check was used for a purpose other than for what it was intended. On June 17, 1999, check numbered 1154, made payable to Seafarer for $1,000.00 for "petty cash" cleared Seafarer's escrow account. The check was used by Ms. Woods to pay Seafarer's telephone and utility bills. Respondent was unaware that check numbered 1154 was going to be used for a purpose other than for what it was written. When Respondent returned from his vacation, he was contacted by Mr. Scott who advised Respondent of the problem with the return of his refund. Respondent checked the bank statements for Seafarer's escrow account and discovered that Ms. Woods had not used the checks for their intended purpose and that she had used funds from the escrow account for improper purposes. On June 25, 1999, Mr. Scott deposited the check that he received from Seafarer. The check, payable to Mr. Scott, was posted to Seafarer's escrow account on June 29, 1999, leaving a negative balance of $2,667.22. For 67 days, between April 5, 1999, when Mr. Scott's deposit of $6,000.00 was deposited in Seafarer's escrow account, and June 29, 1999, the date Mr. Scott's refund of $5,900.00 cleared, Seafarer's escrow account did not have sufficient funds to pay the refund. The period between May 5, 1999, and May 17, 1999, was the only time period, during the 67-day period, that Seafarer's escrow account had sufficient funds to pay the refund. Mr. Scott indicates that his refund was received in his account in July 1999. Respondent remained with Seafarer long enough to ensure that Mr. Scott received his refund. On July 8, 1999, Respondent notified Mr. Butler that he was no longer the broker for Seafarer. Respondent has no prior disciplinary action.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums, and Mobile Homes, enter a final order: Sustaining the Notice to Show Cause and finding that John Scales violated Subsections 326.002(1) and 326.005(1), Florida Statutes (1997). Suspending Respondent's license for three years. Imposing a civil penalty of $5,000.00. DONE AND ENTERED this 14th day of February, 2001, in Tallahassee, Leon County, Florida. ERROL H. POWELL Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of February, 2001. COPIES FURNISHED: Janis Sue Richardson, Esquire Department of Business and Professional Regulation 1940 North Monroe Street, Suite 60 Tallahassee, Florida 32399-2202 Tracy J. Sumner, Esquire 1307 Leewood Drive Tallahassee, Florida 32312 Ross Fleetwood, Director Division of Florida Land Sales, Condominiums, and Mobile Homes Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Barbara D. Auger, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue The issue in this case is whether Respondent, Lee H. Davis, committed the offenses alleged in an Administrative Complaint issued against him on August 16, 1999.
Findings Of Fact Petitioner, the Department of Business and Professional Regulation, Division of Real Estate (hereinafter referred to as the "Division"), is an agency of the State of Florida. The Division is charged with the responsibility for, among other things, regulating the practice of persons holding real estate brokers' and real estate salespersons' licenses in Florida. Section 20.165, and Chapters 455 and 475, Florida Statutes. Respondent, Lee H. Davis, is and was at all times relevant to this matter licensed as a real estate broker in Florida, issued License Number 0186063. The last license issued was as an involuntary inactive broker, c/o 815 New Waterford Drive, No. 204, Naples, Florida 34104. On or about August 24, 1995, Respondent executed a form 400.5 and submitted it to the Division to register as a salesperson with Sentry Realty and Property Management, Inc. ("Sentry"). At all times relevant to these proceedings, Respondent was registered with the Division as employed by Sentry. On or about September 7, 1995, Respondent facilitated a contract for sale and purchase (the "contract") between Robert Trindle as buyer and John Petracelli as seller/builder for property described as Hallandale Park, Plat Book 12, Page 37, Block 37, Lots 6,7,8, a/k/a approximately 2801 North East 214 Street, North Miami Beach, Florida. Mr. Trindle testified that he intended to purchase a townhouse to be built by Mr. Petracelli as part of a project to include 40 to 50 townhouses. The contract provided that a $3,900 deposit was to be held by "Lee H. Davis Escrow Agent." Mr. Trindle gave Respondent two checks totaling $3,900, as the earnest money deposit on the purchase price of $130,000. The first check, dated October 9, 1995, was for $1,000. The second check, dated November 3, 1995, was for $2,900. The checks were made out to "Lee H. Davis-- Escrow." Also noted on the checks was "Davena Group Inc.," which Mr. Trindle understood to be Respondent's real estate company. Each check was negotiated by Respondent within a week of its receipt. At the time of this transaction, Respondent's registered broker was John Brouillette of Sentry. Respondent did not place the escrow deposit with Mr. Brouillette, who testified that he knew nothing of the transaction at the time it occurred and never saw the contract. Respondent represented to Mr. Trindle that he would maintain the escrow deposit as broker during this transaction. Mr. Trindle did not give Respondent permission to transfer the escrow deposit to the builder/seller, Mr. Petracelli. Correspondence from Respondent indicated that he did turn the escrow deposit over to Mr. Petracelli, without informing Mr. Trindle. Mr. Petracelli never built the promised townhouses. Rather, he left the country, absconding with Mr. Trindle's escrow deposit along with monies provided by other purchasers and/or investors in the project. Mr. Trindle attempted to contact Respondent regarding the status of his escrow deposit, but was unable to reach him prior to the filing of his complaint with the Division. As of the date of the hearing, the earnest money deposit had not been returned to Mr. Trindle.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by Petitioner finding that Respondent has violated Subsections 475.25(1)(b), 475.25(1)(d)1, 475.25(1)(e), 475.25(1)(k), and 475.42(1)(d), Florida Statutes, as alleged in the Administrative Complaint issued against Respondent, and that Respondent's real estate license be revoked. DONE AND ENTERED this 13th day of March, 2001, in Tallahassee, Leon County, Florida. ___________________________________ LAWRENCE P. STEVENSON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of March, 2001. COPIES FURNISHED: Sunia Y. Marsh, Esquire Department of Business and Professional Regulation Division of Real Estate 400 West Robinson Street Suite N-308A Orlando, Florida 32801-1772 Lee H. Davis 815 New Waterford Drive, No. 204 Naples, Florida 34104 Herbert S. Fecker, Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
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
The Issue In this disciplinary proceeding, the issues are whether Respondents, who are licensed real estate brokers, failed to reconcile their brokerage escrow account properly; failed to maintain trust funds in an escrow account as required; filed a false report or record; obstructed or hindered Petitioner’s investigator in an official investigation; failed to account for and deliver trust funds; committed various acts of fraud, misrepresentation, dishonest dealing, or culpable negligence in any business transaction; or committed any of these enumerated offenses, as alleged by Petitioner in its Administrative Complaint.
Findings Of Fact The Parties Respondent Rudolph Dyer (“Dyer”) is a licensed real estate broker subject to the regulatory jurisdiction of the Florida Real Estate Commission (“Commission”). Respondent Golden Key Realty, Inc. (“Golden Key”) is and was at all times material hereto a corporation registered as a Florida real estate broker subject to the regulatory jurisdiction of the Commission. Dyer is the president and a director of Golden Key, and at all times relevant to this case he had substantial, if not exclusive, control of the corporation. Indeed, the evidence does not establish that Golden Key engaged in any conduct distinct from Dyer’s in connection with the transactions at issue. Therefore, Respondents will generally be referred to collectively as “Dyer” except when a need to distinguish between them arises. Petitioner Department of Business and Professional Regulation, Division of Real Estate, has jurisdiction over disciplinary proceedings for the Commission. At the Commission’s direction, Petitioner is authorized to prosecute administrative complaints against licensees within the Commission’s jurisdiction. Escrow Account Irregularities and Related Misconduct On or about November 14, 2001, Petitioner conducted a routine audit of Dyer’s records. Pursuant to the audit, Catherine Rivera (“Rivera”), Petitioner’s investigator, determined that as of October 31, 2001, the balance in Dyer’s escrow account was $127. Rivera determined further that Dyer’s trust liability, i.e. the total amount of money that Dyer should have been holding in escrow on his clients’ behalf, was $2,870. Thus, there existed a shortfall of $2,743 in Dyer’s escrow account. In light of this discovery, Rivera requested that Dyer provide additional records, including previous bank statements and the reconciliation statements that licensed brokers must prepare each month showing either that their trust liabilities and bank balances are in agreement or explaining why they are not. Dyer was unable to produce these records, whereupon Rivera advised him that Petitioner would initiate disciplinary proceedings. On or about April 26, 2002, after being formally notified of pending administrative charges arising from the aforementioned deficiencies concerning his escrow account and associated records, Dyer sent Rivera a letter in which he a) admitted having failed to reconcile his bank balances and trust liabilities and b) informed Rivera that “immediately after the audit [on November 14, 2001,] steps were taken to close out all escrow deposit accounts being held by the company.” In fact, Dyer continued to use his escrow account to hold funds in trust through June 2002; as it happened, the escrow account would not be completely closed until July 29, 2002. The undersigned is not convinced, however, that Dyer lied to Petitioner about closing the escrow account, as Petitioner here contends. Rather, given the ambiguity of the language used (“steps were taken”), the undersigned accepts Dyer’s explanation that what he intended to communicate was that activity in the escrow account was being allowed to wind down in an orderly fashion——which was substantially true. Continuing to investigate the matter, Rivera arranged to meet with Dyer at his office on June 19, 2002, to review the previously requested bank records and files. When Rivera arrived on that date, however, Dyer again failed to provide the desired documents. As a result, Rivera scheduled yet another appointment to inspect records at Dyer’s office. The next such meeting would take place on July 29, 2002. In the meantime, Petitioner served a subpoena duces tecum on Dyer’s bank and obtained a complete set of bank records, including canceled checks, pertaining to Dyer’s escrow account. On July 29, 2002, Dyer finally provided reconciliation statements for his escrow account pursuant to Rivera’s longstanding request. These statements were self-contradictory and woefully inadequate, but, if nothing else, they clearly demonstrated (and the undersigned finds) that the escrow account balance fell significantly short of Dyer’s total trust liability during the months of May through August 2001, inclusive. Indeed, there is no dispute (for Dyer admitted at final hearing), and it is hereby found, that at all times relevant to this case, Dyer was commingling trust funds with other funds, to the point that the escrow account effectively became an operating account of Golden Key. Dyer also produced documents purporting to be copies of checks drawn on his escrow account. At least seven of these copies were not genuine reproductions of the respective originals but were, instead, fakes.1 Specifically, in five instances, the payee of an escrow-account check was, according to the copies that Dyer produced, an individual whom, the inference is clear, Dyer owed escrowed funds. In reality, each such check actually had been made payable to and been uttered by Golden Key, which latter facts are irrefutably established by the bank-produced records.2 Dyer admitted that the above-described copies of checks he had produced to Petitioner were fakes, but he denied having personally altered the underlying documents to create the false copies, blaming an unnamed accountant for that misdeed, and he disclaimed advance knowledge of the tampering. The undersigned, however, does not fully believe Dyer’s explanation. Dyer had exclusive authority over the escrow account and substantial control over Golden Key’s operations. The undersigned finds it inconceivable that a stranger to the subject transactions could have knowingly falsified these particular checks, in the manner shown, without Dyer’s active assistance. Therefore, while acknowledging the possibility that Dyer himself might not have altered the documents in question, the undersigned finds that he was, at the very least, aware of and knowingly complicit in the attempted deception. The Fanfan Transactions On or about June 13, 2001, Dyer facilitated a contract between Herinslake, as seller, and Francique Fanfan (“Fanfan”), as buyer, for the purchase and sale of real property commonly known as 5435 Northwest Tenth Street, Plantation, Florida. The contract called for an initial deposit of $500 and an additional deposit of $500 to be placed with Dyer within ten days after the buyer’s acceptance. Dyer received $500 from Fanfan on June 19, 2001. In evidence as Petitioner’s Exhibit 9 is a $500 money order dated June 18, 2001, which names the sender (maker) as “Fan Fan” and lists as his address “601 W Oakland Pk Blvd, Ft Lauderdale 33311.” The undersigned infers that Petitioner’s Exhibit 9 is, in fact, a copy of the money order that Fanfan tendered to Dyer on June 19, 2001, as a deposit on the contract to purchase property from Herinslake. Petitioner alleges (and Dyer disputes) that some time after June 19, 2001, Dyer collected the agreed-upon second $500 deposit from Fanfan, making a total of $1,000 being held in escrow on Fanfan’s behalf. Petitioner asserts that Petitioner’s Exhibit 7, which is a $500 money order dated July 9, 2001, payable to Golden Key, is proof of the second deposit. Petitioner further alleges that after the contract between Herinslake and Fanfan failed to close (which is undisputed), Dyer returned $500 to Fanfan and kept $500 (which is disputed). Taken together, the testimony of Dyer and that of his former salesman, Elysee Joseph, is imprecise, confusing, and somewhat in conflict as it relates to Fanfan. They agree, however, that when the Herinslake-Fanfan transaction fell apart, Dyer returned Fanfan’s entire deposit——of $500. Dyer also points out that months later he assisted Fanfan in the purchase of a condominium unit located at 2800 Northwest Fifty-Sixth Avenue, Lauderhill, Florida. His testimony is corroborated by the settlement statement from that transaction, which is in evidence as part of Petitioner’s Exhibit 11. The settlement statement identifies the seller as Evelyn Goodison; names Francique Fanfan, “a single man,” as buyer; and indicates that the transaction closed on April 10, 2002. According to the settlement statement, Fanfan had placed a $1,000 deposit against the purchase price, and the testimony at final hearing established that Dyer had held this sum in escrow pending the closing. The undersigned finds that Petitioner has failed to prove, clearly and convincingly, that Dyer retained $500 belonging to Fanfan in connection with the aborted contract between Herinslake and Fanfan, for several reasons. First, the money order dated July 9, 2001, a copy of which is in evidence as Petitioner’s Exhibit 7, appears not to have been tendered by Francique Fanfan, the alleged victim here. This particular money order identifies the sender as “Michelle Fanfan” and gives as her address “2076 Kimberly Blvd, N Lauderdale, Fl 33068.” There is no evidence whatsoever in the record regarding Michelle Fanfan, and hence no finding can be made that she was in any way related to Francique Fanfan, who (the evidence shows) was a single man. Moreover, Michelle Fanfan’s address does not match Francique Fanfan’s address as reported in Petitioner’s Exhibit 9. Second, the undersigned believes that it is highly unlikely Fanfan would have continued to do business with Dyer if, as Petitioner alleges, Dyer had cheated him out of $500 on an earlier deal. Thus, the very fact that Fanfan purchased the Goodison property through Dyer tends to refute Petitioner’s charge. Finally, Fanfan, the alleged victim, did not testify at the final hearing, and consequently there is no direct evidence that Dyer took $500 from Fanfan. The Charges In counts I and VII of its Administrative Complaint, Petitioner accuses Respondents of having failed to properly prepare monthly escrow-reconciliation statements. Petitioner’s position is that in maintaining records showing significant shortages in the escrow account for a period of approximately six months, and by failing to take corrective action regarding the shortages, Respondents failed to comply with Rule 61J2- 14.012, Florida Administrative Code, and hence violated Section 475.25(1)(e), Florida Statutes. In counts II and VIII, Petitioner alleges that Respondents committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction, in violation of Section 475.25(1)(b), Florida Statutes. Petitioner’s position is that Respondents committed fraud or misrepresentation when they tendered false or forged documents to Rivera during the course of her official investigation. In addition, Petitioner asserts that Respondents committed culpable negligence towards the individuals who placed their funds in trust with Respondents. In counts III and IX, Petitioner asserts that Respondents obstructed or hindered the enforcement of Chapter 475, Florida Statutes, in violation of Section 475.42(1)(i), Florida Statutes, and therefore in violation of Section 475.25(1)(e), Florida Statutes. Petitioner’s position is that Respondents willfully interfered with Rivera’s investigation by submitting fraudulent documents to the investigator. In counts IV and X, Petitioner accuses Respondents of having made or filed a report or record which the licensee knew to be false, in violation of Section 475.25(1)(l), Florida Statutes. Petitioner’s position is that Respondents knowingly tendered false copies of canceled checks to Rivera. In counts V and XI, Petitioner charges Respondents with failing to account for and deliver trust funds, in violation of Section 475.25(1)(d)1., Florida Statutes. Petitioner’s position is that Respondents failed to account for and deliver the second deposit allegedly received from Fanfan in connection with the Herinslake-Fanfan transaction. In counts VI and XII, Petitioner accuses Respondents of having failed to maintain trust funds in the real estate brokerage escrow account until disbursement was properly authorized, in violation of Section 475.25(1)(k), Florida Statutes. Petitioner’s position is that during the six months of concern, Respondents’ escrow account funds were regularly several thousand dollars less than the trust liability. Ultimate Factual Determinations Dyer failed to prepare written monthly reconciliation statements as required by Rule 61J2-14.012, Florida Administrative Code, and thus he violated Section 475.25(1)(e), Florida Statutes. Petitioner therefore has established the charges set forth in counts I and VII of its Administrative Complaint, by clear and convincing evidence. The evidence does not establish that Dyer committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction. There is no persuasive evidence that Dyer intended to harm (or actually harmed) any of his clients. While Dyer did participate in a dishonest scheme to deceive Rivera by producing false copies of his canceled checks, this particular wrongdoing occurred, not in a business transaction, but rather in connection with a regulatory investigation. Thus, Dyer did not violate Section 475.25(1)(b), Florida Statutes. Counts II and VIII were not proved. Dyer attempted to obstruct or hinder Rivera’s investigation by producing copies of canceled checks that he knew were false and misleading. Petitioner has clearly established that Dyer violated Section 475.42(1)(i), Florida Statutes, which in turn constitutes a violation of Section 475.25(1)(e), Florida Statutes, as charged in counts III and IX of the Administrative Complaint. The evidence does not support the charge that Dyer violated Section 475.25(1)(l), Florida Statutes, which prohibits the filing false reports and records, because the altered documents that Dyer produced to Rivera were not signed by Dyer—— at least not in the sense contemplated by the statute, which specifies that “such reports or records shall include only those which are signed in the capacity of a licensed broker or salesperson.” Counts IV and X thus were not proved. The evidence does not clearly establish that Dyer failed to return a deposit of $500 to Fanfan after his deal with Herinslake fell through. Thus, counts V and XI, which allege violations of Section 475.25(1)(d)1., Florida Statutes, were not proved. Dyer failed to maintain trust funds in a segregated escrow account, in violation of Section 475.25(1)(k), Florida Statutes. Petitioner therefore has established the charges set forth in counts VI and XII of its Administrative Complaint, by clear and convincing evidence.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Commission enter a final order that: (a) finds Respondents guilty as charged in counts I, III, VI, VII, IX, and XII of the Administrative Complaint; (b) revokes Respondents’ respective real estate licenses; and (c) imposes an administrative fine of $3,000 against Respondents, jointly and severally. DONE AND ENTERED this 11th day of June, 2003, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 11th day of June, 2003.
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
The Issue The issues presented herein are whether or not the Respondent, Maria M. Drummond Mulgrave, failed to account and deliver monies received in a trust or escrow bank account monies received as a deposit for realty in a real estate transaction in violation of Subsections 475.25(1)(d), Florida Statutes, and by reason thereof, Respondent engaged in acts and/or conduct amounting to fraud, is representation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction in violation of Subsection 475.25(1)(b), Florida Statutes.
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. During times material herein, Respondent, Maria M. Drummond Mulgrave, was a licensed real estate salesperson and has been issued license number 0396817. Respondent's last issued license was as a salesperson and she worked through the entity, Welsh International Realty, Inc., 4684 NW 183 Street, Miami, Florida 33155. Respondent, in her capacity as a salesperson, on January 31, 1984, was the selling agent who executed a purchase, sales contract and receipt for deposit for purchasers Michael A. and Marjorie Bucknor for a residence situated at 240 NW 203 Terrace, Miami, Florida. The seller of that property was Equitable Relocation Management Corporation (Equitable). Equitable executed the sales contraction February 7, 1984. On January 31, 1984, Respondent Mulgrave received in trust a $1,000 earnest money deposit which was held in an escrow account by her broker, Welsh International Realty, Inc. In connection with the January 31, 1984 sales contract, the purchasers were to tender to the Respondent an additional $6,500 deposit within 5 days of acceptance by the seller or, in this case, on February 12, 1984, inasmuch as Equitable approved and executed the sales contract on February 7, 1984. (Petitioner's Exhibits 1 and 2) 3/ Petitioner has alleged that the listing agency, Associates Realty Company (Associates), requested from the Respondent on March 11 and March 19, 1984, an escrow letter verifying that the additional escrow deposits had, in fact, been made. It is also alleged that the Respondent verbally assured Associates that the entire deposit of $7,500 was in escrow and that the sale would close, but Respondent did not then provide Associates the promised escrow letter. It is also alleged that Associates relied upon Respondent's statements that the deposit was in escrow and that it was not until approximately April 17, 1984 that Respondent admitted to Associates Realty that only $1,000 was in escrow. (Petitioner's Exhibit 3) As stated, Respondent Oswald S. Welsh entered into a stipulated settlement and is no longer a Respondent in these proceedings. Sometime following the execution of the sales/deposit receipt contract by the Bucknors and the sellers, Equitable Relocation Management Corporation, by its agent Claire Smith, Respondent Mulgrave left the Miami area and gave the pending sales contracts to her sponsoring broker, Oswald S. Welsh. Marcia Mize was, during times material herein, the processing supervisor for the listing agency, Associates Realty. Once Ms. Mize began processing the Bucknor contract, she commenced making inquiries from Welsh International Realty, Inc. trying to get the needed verifications of income, etc. to the mortgage company such that the purchasers could be processed and a commitment letter issued. Ms. Mize made several oral requests of Welsh International Realty for verification of the escrow deposits from approximately February 7, 1984 through March 9, 1984. On March 17, 1984, Ms. Mize learned (from Respondent) that Welsh Realty only had $1,000 in escrow. Oswald S. Welsh, the broker for Welsh International Realty, Inc., by letter dated January 31, 1984, advised Associates Realty that Welsh was holding $1,000 in escrow from the Bucknors toward the purchase of the subject property. Marcia Mize was unsure if Respondent Mulgrave advised her that she had the additional $6,500 in deposits. Ms. Mize testified that she spoke with several secretaries employed by Welsh International Realty but she was unable to verify that she determined that it was Respondent Mulgrave who advised that the additional $6,500 deposit was in escrow with Welsh International Realty, Inc. Respondent Mulgrave later determined that the Bucknors were having marital and financial problems and, as a result, were unable to close on the transaction as agreed in the purchase/sales contract. Respondent Mulgrave denies that she, at any time, advised Marcia Mize of Associates Realty that she had the $6,500 which represented the balance of the remainder of the downpayment by the Bucknors in the purchase of the residence from Equitable. Respondent Mulgrave turned this transaction over to her sponsoring broker, Oswald S. Welsh when she had to leave the Miami area to attend to some pending family business. The Bucknors did not give Welsh International Realty, Inc. the remaining $6,500 escrow deposit which represented the remainder of their downpayment toward the purchase of the subject residence.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is hereby recommended that the administrative complaint filed herein against Respondent, Maria M. Drummond Mulgrave, be DISMISSED. RECOMMENDED this 18th day of September, 1985, in Tallahassee, 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 18th day of September, 1985.
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
Recommendation Based upon the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that the Florida Real Estate Commission enter a final order holding Respondent, Stephen E. Schiller, t/a Allstate Realty, guilty of violating Section 475.25(1)(b) and (k), Florida Statutes (1985), under Counts I and II of the Administrative Complaint in this case, and suspending his real estate broker's license no. 0374362 for one year. DONE and ORDERED this 27th day of August, 1986 in Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 August, 1986.
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.
The Issue The issue in this case is whether the Respondent, Shirley Bemenderfer, committed the violations alleged in an Administrative Complaint issued by the Petitioner, Department of Business and Professional Regulation, Division of Real Estate, on December 31, 2001, and, if so, the penalty that should be imposed.
Findings Of Fact Petitioner, the Department of Business and Professional Regulation, Division of Real Estate (hereinafter referred to as the "Department"), is the state agency charged with the duty to prosecute administrative complaints pursuant to Section 20.125, and Chapters 120, 455, and 475, Florida Statutes (2000). At the times material to this proceeding, Shirley K. Bemenderfer is and was a licensed Florida real estate broker. Ms. Bemenderfer's license number is 9995621. For her last issued license, Ms. Bemenderfer was an active broker at 1801 Okeechobee Road, Fort Pierce, Florida 34950. She operated under the trade name of Florida Properties of Fort Pierce. Ms. Bemenderfer has held a real estate license for 30 years. On December 9, 1999, Dawn Luchik, an investigator for the Department, conducted an audit of Ms. Bemenderfer's property management escrow account. The property management escrow account maintained by Ms. Bemenderfer was a single account by which she recorded the receipts and disbursements of all property owners for whom she maintained property (hereinafter collectively referred to as the "Property Owners"). Using information provided by Ms. Bemenderfer, Ms. Luchik compared the "Trust Liability," or the net amount of funds entrusted to Ms. Bemenderfer by the Property Owners, with the net amount of money in the bank account in which Ms Bemenderfer actually deposited the funds. Based upon information initially provided by Ms. Bemenderfer, the Property Owners relevant to this proceeding consisted of individuals identified as Thomas, James C. Kelley, Pulliam, Esquivel, and Samaro. Based upon Ms. Bemenderfer's property management escrow account (hereinafter referred to as the "Escrow Account"), the balances for the Property Owners as of December 9, 1999, were as follows: Thomas $2,565.49 Kelley 97.43 Pulliam 414.52 Esquivel 1,600.00 Samaro (179.86) Total $4,497.58 Information provided by Ms. Bemenderfer indicated that the total balance as of December 9, 1999, for the bank account in which the funds of the Property Owners were maintained (hereinafter referred to as the "Bank Account") totaled $9,650.44. A number of checks which were written and reflected in the Escrow Account had not yet cleared the Bank Account and, therefore, these checks were totaled and added back to the Escrow Account balance as of December 9, 1999. Those checks (hereinafter referred to as the "Outstanding Checks"), according to the information provided by Ms. Bemenderfer, included the following 1/: Payee Check Number Amount Bemenderfer 5213 $125.00 Thomas 52?? 405.00 Paigon 5231 70.00 Samaro 4811 630.36 Samaro 4969 795.77 Samaro 4576 137.46 Total $3,414.86 The amount of the Outstanding Checks, $3,414.86, was added to the Escrow Account total, $4,497.58, to arrive at what the Bank Account total should have reflected: $7,912.44. A comparison of the Bank Account balance of $9,650.44 with the adjusted Escrow Account of $7,912.44, reflected a large discrepancy between the two accounts of $1,738.00. Because the accounts did not balance, Ms. Luchik discussed the matter further with Ms. Bemenderfer to give her an opportunity to explain the cause of the discrepancy. In an effort to explain the discrepancy, Ms. Bemenderfer gave Ms. Luchik additional information concerning the portion of the Escrow Account attributable to Samaro. Based upon the modified information provided by Ms. Bemenderfer to Ms. Luchik, Ms. Bemenderfer's records indicated that the Samaro portion of the Escrow Account had a positive balance of $119.96 rather than the negative balance of ($179.86) initially reported by Ms. Bemenderfer. The modified balance was caused by a number of payments from the account which Ms. Bemenderfer reported had been made prior to December 9, 1999. Additionally, the new information reflected that three checks previously deducted from the Samaro account had been added back because they had never been cashed by Samaro. Those checks (hereinafter referred to as the "Three Samaro Checks") consisted of the following: Payee Check Number Amount Samaro 4811 630.36 Samaro 4969 795.77 Samaro 4576 137.46 Total $1,563.59 Ms. Luchik modified her calculations to reflect the new positive balance in the Samaro portion of Escrow Account, but failed to remove the Three Samaro Checks from the total of the Outstanding Checks reflected in Finding of Fact 7. Using the modified Samaro account balance, Ms. Luchik determined that the total amount of the Escrow Account was $4,797.40. Ms. Luchik them made the following calculation: Escrow Account Balance $4,797.40 Plus Outstanding Checks 3,414.86 Adjusted Escrow Account Balance $8,212.26 Compared to Bank Account Balance 9,650.44 Overage $1,438.18 The overage, or the amount of funds in the Bank Account in excess of the amount recorded in the Escrow Account, was reflected in an Office Inspection & Escrow/Trust Account Audit Form issued by Ms. Luchik on December 9, 1999. Ms. Bemenderfer signed the Office Inspection & Escrow/Trust Account Audit Form. Ms. Bemenderfer was unable to explain why there was an overage. The evidence at hearing proved that Ms. Luchik's calculation of the overage on December 9, 1999, was incorrect. In fact, based upon the information provided to Ms. Luchik by Ms. Bemenderfer during the audit, the overage was actually much higher than determined by Ms. Luchik. The discrepancy was caused by a simple mathematical error in Ms. Luchik's calculations. Ms. Luchik correctly added the Three Samaro Checks back to the Escrow Account to reflect the corrected portion of the account attributable to Samaro but she had already added those same three checks back to the Escrow Account as part of the Outstanding Check balance. Therefore, the amount of the Three Samaro Checks was added to the Escrow Account twice, inflating the balance of the Escrow Account by the amount of the Three Samaro Checks, or $1,563.59. When the Three Samaro Checks are correctly removed from the Outstanding Check amount, the actual overage on December 9, 1999, based upon the information provided by Ms. Bemenderfer was actually much higher than determined by Ms. Luchik: Escrow Account Balance $4,797.40 Plus Outstanding Checks: Amount Used by Ms. Luchik $3,414.86 Reduced by the Three Samaro Checks 1,563.59 1,851.27 Adjusted Escrow Account Balance $6,648.67 Compared to Bank Account Balance 9,650.44 Overage $3,001.77 Based upon the best information available to the Department as of December 9, 1999, Ms. Bemenderfer appeared to have $3,001.77 in her Bank Account in excess of the amount of money she was holding in the Escrow Account for the Property Owners. The evidence failed to prove where the purported excess money came from or who it belonged to. The evidence also failed to prove that the excess amount was in any way caused by Ms. Bemenderfer for any reason other than her simple negligence or incompetence. The December 9, 1999, audit also discovered, based upon records provided by Ms. Bemenderfer, that Ms. Bemenderfer's records of the individual Property Owner's accounts which make up the Escrow Account, often reflected a negative balance. A negative balance indicates that amounts have been expended on behalf of an individual Property Owner in excess of funds received for that individual Property Owner. Ms. Bemenderfer was unable to explain the negative balances. At the request of Ms. Bemenderfer, Ms. Luchik returned to conduct a second audit of her accounts on April 12, 2000. At this time, Ms. Bemenderfer had closed the Bank Account, account number 664413 (hereinafter referred to as the "Original Bank Account"), and opened a new one, account number 1498797 (hereinafter referred to as the "New Bank Account"). As to the Original Bank Account, Ms. Bemenderfer reported that there was no trust fund liability in the Escrow Account. The balance of the Original Bank Account, however, reflected a shortage in the account as of April 11, 2000, of $473.44, apparently reflecting that she had theoretically disbursed $473.44 more than she had received on behalf of the Property Owners. Apparently realizing she had a negative balance in the Original Bank Account, Ms. Bemenderfer deposited $500.00 in the account on the day of the audit, April 12, 2000. Therefore, instead of reflecting a shortage of $473.44 when Ms. Luchik began the audit, the Original Bank Account reflected an overage in the account of $26.56. This amount was reflected by Ms. Luchik in an Office Inspection & Escrow/Trust Account Audit Form completed on April 12, 2000. Ms. Bemenderfer was unable to explain why there was a $473.44 shortage in the Original Bank Account, what the $500.00 deposit she made was attributable to, or why the account ended up with a $26.56 overage. Based upon the best information available to the Department as of April 12, 2000, Ms. Bemenderfer appeared to have $26.56 in the Original Bank Account in excess of the amount of money she had received and disbursed to the Property Owners from the Escrow Account. The evidence also proved that the excess was caused by a deposit of $500.00 made by Ms. Bemenderfer. Finally, the evidence failed to prove that the overage or shortage was in any way caused by Ms. Bemenderfer for any reason other than her simple negligence or incompetence. The April 12, 2000, audit also determined that there was a $124.91 overage in the New Bank Account, which Ms. Bemenderfer was unable to explain. Based upon the best information available to the Department as of April 12, 2000, Ms. Bemenderfer appeared to have $124.91 in her New Bank Account in excess of the amount of money she was holding in the Escrow Account for the Property Owners. The evidence failed to prove where the purported excess money came from or who it belonged to. The evidence also failed to prove that the excess amount was in any way caused by Ms. Bemenderfer for any reason other than her simple negligence or incompetence. Monthly reconciliation statements which Ms. Bemenderfer completed were also reviewed by Ms. Luchik (hereinafter referred to as the "Reconciliations"). There are numerous overages and shortages reflected in the Reconciliations. Ms. Bemenderfer failed to provide an written explanation in the Reconciliations for the overages or shortages and she failed provide a written explanation in the Reconciliations for the correction action that would be taken to eliminate the overages or shortages. In conclusion, Ms. Bemenderfer failed to maintain her Escrow Accounts in a reasonable, understandable fashion as of December 9, 1999, and April 12, 2000. Her accounts simply do not balance. Ms. Bemenderfer's accounts as of December 9, 1999, and April 12, 2000, reflect the negligent and incompetent manner in which the accounts had been maintained. The evidence failed to prove, however, any intentional wrong on her part or that Ms. Bemenderfer benefited in any way from the manner in which the accounts were maintained. On May 19, 1999, the Florida Real Estate Commission adopted a stipulation signed by Ms. Bemenderfer in settlement of an Administrative Complaint issued against her on April 21, 1998. In the April 21, 1998, Administrative Complaint it was alleged an audit conducted in 1997 had revealed an overage of $1,731.36 in Ms. Bemenderfer's bank account, that she had failed to prepare Reconciliations, and that there were shortages in the account of Ron Cason, even though the overall account balance showed an overage. Pursuant to the terms of the stipulation, Ms. Bemenderfer admitted the factual allegations of the Administrative Complaint, agreed that those allegations constituted the violations alleged, and agreed to pay a $1,000.00 fine and costs, serve a one-year probation period, and attend a seven-hour escrow management course.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the a final order be entered finding that Shirley K. Bemenderfer violated Section 475.25(1)(e) and (o), Florida Statutes; requiring that she pay an administrative fine of $500.00; and that she be placed on probation for one year during the first three months of which she shall successfully complete at least a four-hour escrow management course prescribed by the Florida Real Estate Commission. DONE AND ENTERED this 29th day of January, 2003, in Tallahassee, Leon County, Florida. LARRY J. SARTIN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 29th day of January, 2003.
