Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: At all relevant times, respondent, Passport Internationale, Inc. (Passport or respondent), was a seller of travel registered with the Department of Agriculture and Consumer Services (Department). As such, it was required to post a performance bond with the Department conditioned on the performance of contracted services. In this case, petitioner, Dorothy L. Castellano, has filed a claim against the bond in the amount of $59.00 alleging that Passport failed to perform on certain contracted services. The facts giving rise to this controversy are not in dispute. In late 1989, petitioner received a promotion offer from Budget Rent A Car for a "free" one-day cruise for two persons from Fort Lauderdale to Freeport (Bahamas Islands) on Discovery Cruise Lines. The travel was to be arranged by Passport and required petitioner to pay Passport a $40.00 fee, plus $19.00 in port taxes, or a total of $59.00. She did so on March 6, 1989, as evidenced by a money order made payable to Passport International Express, a ficticious name then used by Passport. After it received the money, Passport issued two travel certificates to petitioner. On the face of each certificate was the notation "Not valid after 08/30/90." This meant that petitioner had to use the certificates no later than August 30, 1990. Even so, this gave petitioner more than a year in which to take the trip. Petitioner does not deny that she was aware of this restriction. According to Passport, the expiration date was controlled by Discovery Cruise Lines and thus it had no authority to extend the life of the certificates. No evidence was adduced regarding the refund policy of Passport. Petitioner eventually made reservations to use the certificates in July 1990. On June 6, 1990, she broke her ankle and was temporarily disabled. As a consequence, she could not travel before the certificates expired. Although petitioner contacted both Passport and Discovery Cruise Lines and requested either a refund of her money or an extension of time in which to use the certificates, her request was denied. Therefore, petitioner was unable to use the certificates. She then filed a claim with the Department seeking a refund of her money.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the claim of petitioner against the bond of respondent be denied. DONE AND ENTERED this 28th day of November, 1994, in Tallahassee, Florida. DONALD R. ALEXANDER 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 28th day of November, 1994. COPIES FURNISHED: Dorothy L. Castellano 3821 S. E. 44th Street Ocala, Florida 34480 Michael J. Panaggio 2441 Bellevue Avenue Daytona Beach, Florida 32114 Robert G. Worley, Esquire 515 Mayo Building Tallahassee, Florida 32399-0800 Honorable Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, FL 32399-0810 Richard D. Tritschler, Esquire The Capitol, PL-10 Tallahassee, FL 32399-0810
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: At all relevant times, respondent, Passport Internationale, Inc. (Passport or respondent), was a seller of travel registered with the Department of Agriculture and Consumer Services (Department). As such, it was required to post a performance bond with the Department conditioned on the performance of contracted services. In this case, petitioner, Susan Swank, has filed a claim against the bond in the amount of $678.90 alleging that Passport failed to perform on certain contracted services. Petitioner's husband has been confined to a wheelchair since 1982 due to a medical condition. As such, all travel accommodations made by petitioner must be in handicap accessible facilities. When petitioner purchased from Passport a travel certificate entitling her and Mr. Swank to a five day, four night trip to the Bahamas, she noted on her contract "Must have handicap room." In addition, on the Customer Request Form filled out by petitioner on November 1, 1990, she wrote in large letters: "Attention, wheelchair - must have bottom floor." Both the contract and form were returned to Passport prior to petitioner's trip. Respondent concedes that it was aware of petitioner's special request. Indeed, its representative at hearing stated that she knew none of the hotels in the Bahamas used by Passport had satisfactory handicap accessible rooms, and she told a Passport customer service representive dealing with petitioner to so advise her of this fact. The representative failed to do so and instead booked the trip at a hotel which could not accommodate petitioner's husband. When petitioner and her husband arrived at their hotel in Freeport, the hotel was obviously unable to honor their request for a ground floor, handicap accessible room. Rather, it assigned them to an upstairs room with a bathroom door so small that the wheelchair could not gain access. Petitioner was forced to transfer to another, more expensive hotel and pay the additional cost herself. Had she known to begin with that no handicap accessible rooms were available, she would not have agreed to purchase the vacation package. Because of Passport's misrepresentation as to the type of accommodations being offered, petitioner is entitled to a refund of $678.90, the derivation of which is found in her exhibit 1 received in evidence.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the claim of petitioner against the bond of respondent be granted, and she be paid $678.90 from the bond. DONE AND ENTERED this 9th day of December, 1994, in Tallahassee, Florida. DONALD R. ALEXANDER 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 9th day of December, 1994. COPIES FURNISHED: Susan Swank 3447 Daren Drive Freeport, Illinois 61032 Michael J. Panaggio 2441 Bellevue Avenue Daytona Beach, Florida 32114 Robert G. Worley, Esquire 515 Mayo Building Tallahassee, Florida 32399-0800 Honorable Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, FL 32399-0810 Richard D. Tritschler, Esquire The Capitol, PL-10 Tallahassee, FL 32399-0810
Findings Of Fact Santa Cruz Marketing, Inc., d/b/a SMI (hereinafter referred to as SMI), a Delaware corporation, is located at Suite 29, 1280 South Powerline Road, Pompano Beach, Florida 33069. Although SMI began operating as a business in Florida in December of 1988, it was not authorized to do business in Florida until December of 1991. At all times material hereto, Edward Winders has been the president/secretary, Jim Winders has been the vice president/treasurer, and Cecil Butler has been the general manager for SMI. Edward Winders and Jim Winders each own 50% of the stock of SMI. Cecil Butler has no ownership interest in SMI and is simply a salaried employee. Edward Winders and Jim Winders are responsible for the day-to-day operation of the business. Although Cecil Butler has some unidentified level of supervisory responsibility over some of the other employees, no evidence was offered that he in any way participates in management decisions regarding the operation of the business itself. SMI advertises by placing ads in newspapers throughout the United States. Its ad reads as follows: "Easy credit card, cash advance, $5000 credit line, no credit check! Call 1-800-347-0773." SMI's business operations consist of the following units: the origination department, the customer service department, the clerical section, and the shipping section. When a call is placed using the toll-free number, that telephone call is answered by an account representative in the origination department. A written script called a credit card presentation is utilized by the account representative. The account representatives do not deviate from that script. The account representative obtains basic information from the caller, gives a brief program description, and then causes to be sent a packet of information called the first mailer to the caller. The script utilized by the account representative, however, does not tell the account representative how to answer questions from the callers. No evidence was offered as to any procedures SMI may have in place for assuring the correctness of answers given to callers' questions. The credit card presentation script tells the caller that he or she has reached the "easy credit card division," advises the caller that "our credit card offers a $5,000 line of credit which includes cash advance availability, now our major credit cards are also available regardless of credit history!", advises the caller that there are no annual fees and that the lifetime membership is a "one time processing fee," advises the caller that he or she is participating in a "limited membership drive," and advises the caller that "all the information on our credit card will be in your package along with our customer service number." The first mailer greets the "prospective member," refers to SMI's credit card program, encloses a pre-approved application, sets forth the amount of SMI's "lifetime membership fee," encloses a "100% money-back guarantee certificate," encourages the recipient to return his or her application and membership fee within 10 days, and promises a $100 gift certificate usable on the charge balance. The lifetime membership fee is $75 if paid by money order or cashier's check and $85 if paid by personal check or C.O.D. No further information is given regarding the details of SMI's "credit card program." An enclosure in the first mailer is a one-page sheet entitled "Special Notice." It features a facsimile of a Visa card and a facsimile of a MasterCard card. The short text includes the following language: Mail today and receive all these privileges. *CASH ADVANCES *VISA CARD AVAILABLE *MASTERCARD AVAILABLE *$100.00 MERCHANDISE CERTIFICATE *ADD POSITIVE INFORMATION ON YOUR CREDIT REPORT HAPPY SHOPPING!!!! The enclosed return envelope is directed to Santa Cruz Marketing, Inc. The line underneath that states that the envelope is going to "SMI Card Distribution Center." If the recipient does not immediately comply, a second mailer is sent five days later. The enclosures are the same as in the first mailer. The "dear prospective member" letter is different and is "just a friendly reminder that we have not received your lifetime membership fee for your pre-approved $5,000 credit card." It encourages the recipient to "take advantage of this unique credit card offer!" and advises the recipient that if the recipient's deadline has already expired, then a call should be placed to SMI's customer service department at a non-toll-free number. After the recipient submits the pre-approved application and pays the membership fee, he or she then receives the membership package. That package begins with a letter greeting the "new card member" and contains the following introductory paragraph: Welcome to the wonderful world of home shopping with your SMI credit card. As a preferred card member, you are offered the opportunity to purchase merchandise from our fantastic color catalogues filled with a wide variety of items. Attached to the letter is an SMI credit card. That letter is the first advice given by SMI to its new "lifetime member" that he or she has paid $75 to join a home shopping club. The letter further advises the recipient that purchasing merchandise from SMI's catalogues will "enable you to establish that A+ credit rating you have always desired, but which may have been denied to you in the past." The letter further advises that SMI will submit monthly statements to the member and that the member can then pay 10% of the balance (with a minimum payment of $15) or the balance can be paid in full. The letter also advises that the new member will pay no interest charges on his or her purchases, "but please remember in order to help you establish your A+ credit rating, your payments must be made on time." The membership packet also contains two merchandise catalogues, an order form, and a price list. According to the price list and the terms of SMI's home shopping program, two prices are available to an SMI member. For each item, the member may pay a specified cash price and a specified shipping charge. Alternatively, the member can pay a credit price, which is higher than the cash price. If the member chooses to purchase the item on credit, the member will pay the higher price as follows: the member includes with his or her order form a specified portion of the credit price as a down payment on the item, with the balance of the credit price being charged to the member's charge account. The member paying the higher credit price will also pay the specified shipping charge. The promised $100 merchandise certificate is included in the membership packet. The certificate specifies that it can only be applied to the credit portion of an order after the down payment for that order is paid and that the certificate is void after 30 days from the date on which the membership was issued. The membership packet includes, for the first time, a description of SMI's cash advance program. The description of that cash advance program begins as follows: Once you have established a sufficient credit record with SMI, you will be extended 'cash advance privileges'. Simply prove your credit worthiness by shopping with your SMI credit card. All you have to do is, charge and pay for at least $500.00 of purchases of your unpaid balance. Once you have done that, you have qualified for a cash advance of $250.00. CASH ADVANCES OFFERS Immediate cash No interest charge Low monthly payments No processing fee Cash advances up to $2,500.00 According to the program, a cash advance of $2,500 would only be available if a member had charged and paid for $5,000 worth of purchases. The flyer also recites that the $100 merchandise certificate does not apply to cash advances. The next flyer contained in the membership packet is entitled "Qualify for a Visa or MasterCard." That flyer features facsimiles of both a MasterCard and a Visa card. The description of that portion of SMI's program begins as follows: Simply prove your credit worthiness by using your SMI Credit card. Just charge and pay for at least $750.00 of your unpaid balance. It's as simple as that! Once you have established a sufficient credit record, you will be sent a 'GOOD CREDIT REFERENCE LETTER' that you can use when applying for credit elsewhere. Plus, you will receive a 'MAJORITY APPROVED' application for a visa or mastercard with 'NO SECURITY DEPOSIT REQUIRED.' UNSECURED - NO SECURITY DEPOSIT REQUIRED (WE WILL DO IT FOR YOU) A $380.00 IMMEDIATE CREDIT LINE CASH ADVANCES COMPETITIVE INTEREST RATES ONE TIME PROCESSING CHARGE ONLY $35.00 ANNUAL CHARGE MAJORITY APPROVED WE ARE SO SURE THAT YOU WILL BE APPROVED THAT WE WILL SEND YOU A 'CASHIERS CHECK FOR $380.00' IF YOU DO NOT QUALIFY. The flyer points out that the $100 merchandise certificate does not apply to this part of the program. Another flyer contained in the membership packet explains a second way in which a member can qualify for a Visa or MasterCard as follows: New Collateralized Credit Card Program You Can Now Obtain a Major Bank Credit Card even though you may have previously been turned down! Under the 'collateralized credit card program' the member may obtain a secured major bank credit card which 'requires a security deposit equal to your initial credit limits.' If the member returns the coupon requesting details, SMI provides the name of another company, Access Credit Card Company, which company would charge an additional fee to provide the member with an application from New Era Bank. If the member followed that procedure, he or she would most likely obtain a Visa or MasterCard bank card from New Era Bank with a credit limit equal to the amount of money the member was willing to deposit in New Era Bank since that bank approves the majority of such applications. The membership packet contains three additional flyers. The first one relates to the SMI jewelry catalogue and explains that most gold items are sold by weight at current gold market prices, that prices fluctuate daily with the market, and that the member should check with SMI's ordering department by phone to receive current market prices. The second flyer gives the member information on joining the Select Coupon Club by paying a membership fee of $19.95 and receiving coupons for use at the supermarket. The third flyer describes a program whereby the member can pay $14.95 postage and handling and receive a Hotel Express Membership Directory and membership discount at participating hotels and resorts. A customer cannot obtain an SMI credit card prior to payment of the $75 membership fee. A customer cannot obtain credit for purchasing products from SMI's catalogues prior to payment of the membership fee. The SMI catalogues, received after payment of the fee, are not available to the general public. The customer is not informed prior to paying the membership fee, either during telephone conversations with SMI account representatives or from the first two mailers, that the credit card which the customer would receive can only be used to purchase goods from the two SMI catalogues. Although prospective members are advised in the first and second mailers that Visa and MasterCard cards are available, they are not told how they can obtain such cards until after they have paid their fee. Until after payment of the fee, they are not told that they can obtain a secured, i.e., a fully collateralized bank card by depositing in that bank monies equivalent to the credit limit then extended to them by the bank. Customers are not told prior to the payment of their membership fee, either by SMI account representatives during telephone conversations or in the first or second mailers, that the obtaining of a secured Visa or MasterCard card from New Era Bank will also require the payment of a processing fee and will carry a minimum $500 deposit requirement. Until after payment of the fee, they are not told that the alternative is to charge and pay for $750 worth of merchandise from SMI's two catalogues (not including the amount paid as a down payment on each item purchased) which amounts to $850 worth of charged merchandise if the customer uses the $100 gift certificate, in exchange for SMI then giving the customer a letter saying the customer is a good credit risk, which the customer can then present in applying for credit elsewhere. No evidence was offered that any other organization considers SMI's letter of recommendation meaningful. Prior to the payment of the fee, the prospective member is not advised that the cash advances which he or she would become entitled to receive are limited to an amount of one-half of the total balance the member has paid on the member's SMI charge account balance. No member has received a cash advance from SMI. No members have obtained a Visa or MasterCard card by charging and then paying for $750 worth of products from SMI's catalogues. Other than those documents previously described, no other documents, contracts, or statements are provided by SMI to prospective members or members. SMI purchases the products found in its catalogues at the distributorship cost, a lower price than members pay for the products when they purchase from SMI. As of July 1, 1991, SMI had 12,567 members. By the time of the final hearing in this cause, SMI had over fifteen thousand members. Eighty-four members had purchased items from the SMI catalogues. Petitioner received a consumer complaint regarding SMI in February of 1990. On June 28, 1990, Petitioner served on SMI a subpoena requesting that SMI provide to Petitioner the following information: Name of surety bonding company, location of surety bond and copy of surety bond; location and account number of Florida escrow account, proof of account; copy of information statement and consumer contract. SMI was unable to respond to the subpoena by providing that information because it did not have those items. SMI did respond to the subpoena, however, by providing copies of its advertising and the materials used in its mailers and membership packages. SMI further obtained a bond pursuant to Petitioner's direction to do so. In a series of letters from SMI's attorney to Petitioner, SMI submitted revised advertising and revised informational documents requesting Petitioner's approval of the revisions to bring SMI in compliance with the Department's requirements. The Department failed to respond to SMI's requests. Rather, on March 21, 1991, the Department served on Jim Winders and Cecil Butler an Administrative Complaint for Entry of a Cease and Desist Order and Imposing Penalties, alleging that Jim Winders and Cecil Butler were operating as a credit service organization without fully complying with Chapter 817, Florida Statutes. Jim Winders and Cecil Butler timely requested a formal hearing, and this cause was transferred to the Division of Administrative Hearings. While this administrative proceeding was pending, on July 1, 1991, the activities of loan brokers became regulated, and responsibility therefor was assigned to the Department. On August 12, 1991, the Department filed its Amended Complaint for Entry of a Cease and Desist Order and Imposing Penalties which included the allegations in the original Administrative Complaint, named SMI as a Respondent for the first time, added allegations that the three Respondents were operating as loan brokers, and further added allegations that the three Respondents were operating as retail sellers.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered Finding Respondents SMI and Jim Winders guilty of the allegations contained in the Amended Complaint for Entry of a Cease and Desist Order and Imposing Penalties as described in this Recommended Order; Finding Respondent Cecil Butler not guilty of the allegations contained within the Amended Complaint for Entry of a Cease and Desist Order and Imposing Penalties; Ordering Respondent SMI to cease and desist from violations of the statutes regulating the operation of credit service organizations, loan brokers, and retail sellers; Ordering Respondent Jim Winders to cease and desist from violations of the statutes regulating the operation of credit services organizations and loan brokers; Imposing an administrative fine against Respondent SMI in the sum of $90,000 to be paid by a date certain; and Imposing an administrative fine against Respondent Jim Winders in the sum of $6,000 to be paid by a date certain. DONE and ENTERED this 12th day of March, 1992, at Tallahassee, Florida. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SC 278-9675 Filed with the Clerk of the Division of Administrative Hearings this 12th day of March, 1992. APPENDIX TO RECOMMENDED ORDER The Department's proposed findings of fact numbered 1-30, 34-46, 56, 57, 59- 66, 71-83, 85-89, and 91 have been adopted either verbatim or in substance in this Recommended Order. The Department's proposed findings of fact numbered 31, 32, 95, and 96 have been rejected as not constituting findings of fact but rather as constituting argument of counsel, conclusions of law, or recitation of the testimony. The Department's proposed findings of fact numbered 33 and 97 have been rejected as being contrary to the evidence in this cause. The Department's proposed findings of fact numbered 84, 90, 92-94, and 111 have been rejected as being irrelevant to the issues under consideration in this cause. The Department's proposed findings of fact numbered 47-55, 58, and 67-70 have been rejected as being unnecessary to the issues involved herein. The Department's proposed findings of fact numbered 98-106 have been rejected as being subordinate to the issues herein. The Department's proposed findings of fact numbered 107-110 have been rejected as not being supported by any competent evidence in this cause. Respondents' proposed findings of fact numbered 1-3 have been adopted either verbatim or in substance in this Recommended Order. Respondents' proposed findings of fact numbered 4-11 have been rejected as not constituting findings of fact but rather as constituting argument of counsel, conclusions of law, or recitation of the testimony. Respondents' proposed findings of fact numbered 12-19 have been rejected as being subordinate to the issues herein. COPIES FURNISHED: Bridget L. Ryan, Esquire Richard Bisbee, Esquire Department of Banking and Finance Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32399-0350 Jan Peter Weiss, Esquire Parkway Plaza-Suite 21 1280 South Powerline Road Pompano Beach, Florida 33069 Honorable Gerald Lewis Comptroller, State of Florida The Capitol, Plaza Level Tallahassee, Florida 32399-0350 William G. Reeves, General Counsel Department of Banking and Finance Room 1302, The Capitol Tallahassee, Florida 32399-0350
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: At all relevant times, respondent, Passport Internationale, Inc. (Passport or respondent), was a seller of travel registered with the Department of Agriculture and Consumer Services (Department). As such, it was required to post a performance bond with the Department conditioned on the performance of contracted services. In this case, petitioner, Barbara Bradshaw, has filed a claim against the bond in the amount of $435.40 alleging that Passport failed to perform on certain contracted services. For touring a timeshare resort in early 1992, petitioner received a travel certificate as a gift. After paying a $179.00 validation fee, the certificate entitled the holder to a five day, four night stay in the Bahamas. The certificate carried the name, address and logo of Passport International Express, a fictitious name then being used by Passport. Passport's assets and liabilities were assumed by Incentive Internationale Travel, Inc. (Incentive) in June 1991, and the corporation was dissolved sometime in 1991. Even so, Incentive continued to sell Passport's travel certificates at least through April 1992, when petitioner received her certificate. Therefore, the travel services described in those certificates were protected by Passport's bond. To validate her certificate, on April 17, 1992, petitioner sent Passport International Express a check in the amount of $179.00. Thereafter, she upgraded her accommodations, purchased additional land accommodations, and paid for port taxes. These items totaled $242.00, and were paid by check sent to Incentive on May 26, 1992. Throughout this process, petitioner assumed she was still dealing with Passport since she was never formally advised that Passport had been dissolved or that Incentive had assumed all of Passport's obligations. Petitioner was scheduled to depart on her trip on July 24, 1992. On July 15, 1992, Incentive mailed her a form letter advising that it was necessary to "temporarily delay" her trip due to "circumstances beyond (its control.)" She was offered several options, including a total refund of her money to be made in January 1993. She opted for a refund. To date, however, nothing has been paid, and Incentive is now subject to bankruptcy court protection.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the claim of petitioner against the bond of respondent be granted and that she be reimbursed from the bond in the amount of $421.00. DONE AND ENTERED this 13th day of December, 1994, in Tallahassee, Florida. DONALD R. ALEXANDER 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 13th day of December, 1994. COPIES FURNISHED: Barbara Bradshaw 1169 La Mesa Avenue Winter Springs, Florida 32708 Michael J. Panaggio 2441 Bellevue Avenue Daytona Beach, Florida 32114 Robert G. Worley, Esquire 515 Mayo Building Tallahassee, Florida 32399-0800 Honorable Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, Florida 32399-0810 Richard D. Tritschler, Esquire The Capitol, PL-10 Tallahassee, Florida 32399-0810
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: At all relevant times, respondent, Passport Internationale, Inc. (Passport or respondent), was a seller of travel registered with the Department of Agriculture and Consumer Services (Department). As such, it was required to post a performance bond with the Department conditioned on the performance of contracted services. In this case, petitioner, R. Jane Frazier, has filed a claim against the bond in the amount of $813.00 alleging that Passport failed to perform on certain contracted services. On June 4, 1990, petitioner purchased a travel certificate from Jet Set Travel, a Maryland telemarketeer authorized to sell travel certificates on behalf of Passport. The certificate entitled the holder to fourteen nights' accommodations in Hawaii plus roundtrip airfare for two persons, with all travel arrangements to be made by Passport. The certificate carried the name, address and logo of Passport. During petitioner's dealings with Passport's agent, it was represented to her that for $89.00 per night, she would receive a two bedroom, oceanfront condominium. This constituted a misrepresentation on the part of the agent since the rooms were actually more expensive. Relying on that representation, petitioner authorized a $328.00 charge on her credit card payable to Jet Set Travel to be used as a credit on services purchased in Hawaii. She also paid a $50.00 refundable deposit to Passport. In August 1990, petitioner contacted Passport regarding travel dates and was told the charge on her room would be $124.00 per night, and not $89.00 per night as promised by Jet Set Travel. In charging this amount, Passport relied upon its brochure which priced the accommodations in the range of $89.00 to $124.00 per night, with the highest price for the type of room selected by petitioner. Fearing that she would lose her $328.00 fee and $50.00 deposit if she did not pay the higher amount, petitioner reluctantly agreed to send a cashier's check in the amount of $1,406.00 to Passport, which represented fourteen nights' lodging at $124.00 per night. Finally, before she departed on the trip, petitioner was required to pay another $25.00 miscellaneous fee to Passport, the basis for which was never explained. When petitioner arrived in Hawaii on October 11, 1990, she discovered that her assigned accommodations for the first week at the Kona Reef were unavailable because Passport had failed to make a reservation. Accordingly, she was forced to purchase five nights accommodations at the Kona Reef for $524.02 plus two nights at another facility for $248.00. The accommodations for the second week were satisfactory. After petitioner brought this matter to the attention of Passport, she acknowledged that she received a refund check for the first seven nights' stay, although she says she can't remember if it was for all or part of her out-of- pocket costs. Passport's contention that its books reflect an entry that she was paid for the entire amount was not contradicted although neither party had a cancelled check to verify the actual amount of the payment. Passport's testimony is accepted as being the more credible on this issue. Because petitioner relied on a misrepresentation by Passport's agent as to the type and price of accommodations being offered, she is entitled to be reimbursed her $50.00 refundable deposit (which was never returned), the $25.00 miscellaneous fee paid on September 26, 1990, for which no justification was shown, and the difference between the originally agreed on price ($89.00 per night) and the actual price ($124.00) for the last seven nights accommodations, or $245.00. Accordingly, she is entitled to be paid $320.00 from the bond.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the claim of petitioner against the bond of respondent be granted, and he be paid $320.00 from the bond. DONE AND ENTERED this 13th day of December, 1994, in Tallahassee, Florida. DONALD R. ALEXANDER 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 13th day of December, 1994. COPIES FURNISHED: R. Jane Frazier 3070 Meadow Lane Mobile, Alabama 36618-4634 Michael J. Panaggio 2441 Bellevue Avenue Daytona Beach, Florida 32114 Robert G. Worley, Esquire 515 Mayo Building Tallahassee, Florida 32399-0800 Honorable Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, Florida 32399-0810 Richard D. Tritschler, Esquire The Capitol, PL-10 Tallahassee, Florida 32399-0810
Findings Of Fact The Respondent. At all times relevant to this proceeding, the Respondent, George Costage, served as a member of the City Commission of the City of Safety Harbor (hereinafter referred to as the "City"). Mr. Costage was first elected to the City Commission in March of 1986. He was reelected to the City Commission in 1988 and 1990. His bid for reelection in 1992 was unsuccessful. Mr. Costage's service on the City Commission was his only experience holding public office. Mr. Costage had previously worked as a fireman in the City of Detroit until his retirement. Mr. Costage was paid a salary of approximately $400.00 a month for his service on the City Commission. The City of Safety Harbor's Travel Policy and Procedure. Members of the City Commission, including Mr. Costage, were required from time to time to travel on behalf of the City. For example, travel for the City in conjunction with the Florida League of Cities was expected of Commissioners, including Mr. Costage. Mr. Costage served on the Ethics Committee of the Florida League of Cities. Commissioners also incurred expenses dealing with the citizens of the City which they usually were not specifically reimbursed for. In lieu of reimbursing Commissioners for such expenses, all Commissioners were paid $150.00 a month by the City. The $150.00 monthly payment was intended as reimbursement for the otherwise unreimbursed expenses they incurred. Commissioners were paid $150.00 per month regardless of the amount of actual expenses they incurred. The City also paid Commissioners for expenses they incurred for travel out side of the City on City business. For example, travel by Commissioners to an annual Florida League of Cities' meeting in Crystal River, Florida, was paid for by the City. There were several methods by which the City paid for out-of-town travel expenses of Commissioners: The City made payments directly to the vendor on behalf of a Commissioner; A credit card was issued by the City for each Commissioner. Commissioners were allowed to use the credit card to charge expenses which the City then paid directly to the credit card company; Commissioners could obtain reimbursement from the City for expenses they had previously incurred and paid out of their own resources; and The City could advance funds to Commissioners to cover estimated travel expenses to be incurred. The City used a form titled a "Travel Expense Certificate" (hereinafter referred to as the "Travel Form") in conjunction with the payment of travel expenses of Commissioners. The Travel Form was to be used by Commissioners to obtain reimbursement of travel expenses a Commissioner incurred and paid for out of the Commissioner's own resources. See Advocate's exhibit 4A and 4B, a photocopy of Travel Forms used by Mr. Costage. On the back of the Travel Form were instructions concerning how to complete the form and "Travel Expenses Regulations." Among other things, the following was printed on the back of the Travel Form: Traveling expenses shall be limited to those expenses incurred in the performance of a public purpose authorized by law to be performed and must be within the limitations prescribed below. . . . . . . . Certificate: "I certify that the expenses shown herein were necessary and actually incurred during, authorized travel in performance of official duty and the claim made herewith is true and correct in every manner." The City had established policies governing reimbursement of travel incurred by Commissioners. Some of those polices were in writing, having been included on the back of the Travel Form. The evidence failed to prove that the City, however, always strictly enforced its policies. Because of alleged problems associated with travel expenses paid by the City, including the issues in this case, the City adopted more extensive written travel policies by Resolution adopted November 20, 1989. Travel Expenses of Family Members. Commissioners, at times, took family members, including spouses, with them while traveling on City business. The City also, at times, made travel arrangements for family members and made advance payments of travel expenses for family members. It was the policy of the City that travel expenses of family members of Commissioners were not "expenses necessarily incurred in the performance of a public purpose authorized by law to be performed . . . ." Therefore, the City expected reimbursement of travel expenses incurred by family members. Although the City's policy concerning the payment of travel expenses of family members set out in finding of fact 15 was not specifically stated in writing, the general policy contained on the back of the Travel Form is sufficient to put a reasonable person on notice that they should determine whether a family member's travel expenses are "necessarily incurred in the performance of a public purpose authorized by law to be performed " It was not the policy of the City that travel expenses of spouses or other family members of a Commissioner incurred while the Commissioner was traveling on City business were to be borne by the City. The City did not require reimbursement for certain travel expenses incurred by a Commissioner which also benefited a family member of the Commissioner. Those expenses were limited to expenses which would generally have been incurred by the Commissioner regardless of the presence of the family member on the trip, i.e., the cost of a rental vehicle. Travel Expenses Incurred by Mr. Costage's Spouse Paid by the City. At issue in this proceeding is the period of time between March, 1986 and November 20, 1989, when the City adopted a written policy clearing setting out more extensive travel policies of the City. During the period of time at issue in this case, and while Mr. Costage was a Commissioner, his wife of thirty-seven years accompanied him on trips he took on City business. The City paid Mrs. Costage's travel expenses directly to the vendor when making travel arrangements or it paid travel expenses attributable to Mrs. Costage charged on the credit card provided to Mr. Costage by the City for his use. On at least one occasion, the cost of a helicopter trip over the Grand Canyon incurred by Mr. and Mrs. Costage was paid for by the City. Mr. Costage took no immediate action to reimburse the City for travel expenses paid by the City for Mrs. Costage's travel. Not until well after Mr. Costage was questioned publicly about the expenses paid by the City for Mrs. Costage's travel did Mr. Costage reimburse the City for her travel expenses. Mr. Costage's Payment of Mrs. Costage's Travel Expenses to the City. During Mr. Costage's campaign for reelection to the City Commission in the Spring of 1990, the propriety of the payment of the City of travel expenses incurred by Mr. Costage's spouse was questioned. As a result of the issue being raised, Mr. Costage requested that the City Manager determine the amount of travel expenses which the City had paid for Mrs. Costage's travel. This request was made in approximately March, 1990. The City Manager then requested and received an accounting from the City finance department. Based upon the records of the City finance department, it was initially determined that a total of approximately $3,100.00 in travel expenses attributable to Mrs. Costage had been paid by the City and had not been repaid by Mr. Costage. Mr. Costage was apprised of the City finance department's determination in approximately March, 1990. Mr. Costage asserted that the correct amount was about half the $3,100.00 amount arrived at by the City finance department. No reimbursement was made in March, 1990. At about the same time that Mr. Costage was informed of the amount of travel expenses attributable to his spouse, the Pinellas County Sheriff's Office began an investigation into the City's payment of travel expenses on behalf of family members of Commissioners and others. This was a general investigation, not limited to any one Commissioner or individual. As a consequence of the investigation, Mr. Costage took no further action to reimburse the City for the expenses paid on behalf of his spouse. Subsequent to the completion of the Sheriff's Office investigation, Mr. Costage again discussed the amount of his spouse's travel expenses with the City and it was mutually agreed that the correct amount of unreimbursed travel expenses paid by the City for Mrs. Costage was $2,974.63. Mr. Costage reimbursed the City this amount in February, 1991. Mr. Costage's Knowledge of the City's Policy Concerning the Payment of Family Member Travel Expenses. Mr. Costage has suggested that he did not violate Section 112.313(6), Florida Statutes, because of his assertion that the City did not have a policy that required him to pay for his spouse's travel expenses--that the City practice was just the opposite. He also has asserted that, if the City had such a policy, he was never informed that he was required to repay his spouse's travel expenses and he was not otherwise aware of such a requirement. These assertions are not supported by the weight of the evidence. First, the assertion that no policy requiring reimbursement of family- member travel expenses existed is contrary to the weight of the evidence: The statements on the back of the Travel Form are sufficient to place a reasonable person on notice that such expenses should not be paid for by the City. The statements are, at the very least, sufficient that it would be unreasonable for Mr. Costage to simply assume that his spouse's travel was "incurred in the performance of a public purpose authorized by law"; Several other Commissioners who served during at least part of the period that Mr. Costage was a Commissioner were specifically told that travel expenses incurred by family members of Commissioners were required to be repaid to the City by the Commissioner. See the testimony of Commissioners Caldemeyer, Cincota and Baty, City Mayor Dettmer and City Mayor Levine. Mr. Costage's assertion that it was the practice, if not the policy, of the City that travel expenses of family members were to be paid by the City is also not supported by the weight of the evidence: Except for Mr. Costage and former Commissioner McLaughlin, all the City officials who served during the period of time at issue and who testified at the final hearing of this matter indicated that they were aware that they were ultimately responsible for travel expenses incurred by family members and that the City did not pay those expenses; The evidence failed to prove that travel expenses of family members other than those attributable to Mr. Costage's spouse and possibly Mr. McLaughlin's spouse were paid for by the City without reimbursement; If the City had a policy of paying for spouse travel expenses without requiring reimbursement, why then did Mr. Costage ultimately repay the City almost $3,000.00? He repaid the expenses because he knew City policy required reimbursement and because his use of public funds for his spouse's benefit had been exposed; At best, the evidence proved that the City did not strictly enforce the policy that travel expenses were only to be paid with public funds if they were incurred for a public purpose. As a consequence of the City's lack of strict enforcement, Mr. Costage was able to avoid paying for his spouse's travel expenses from March, 1986 until February, 1991. The lack of enforcement of the City's travel policies, however, does not prove that the City had an established policy of paying the travel expenses of Commissioner's spouses. It only proved that City employees failed to question members of the City's governing body about their actions. The weight of the evidence also proved that Mr. Costage, despite his assertions to the contrary, was told and/or was aware of the City's policy requiring reimbursement of travel expenses of spouses: First, it is concluded that Mr. Costage was aware of the instructions on the back of the Travel Form: Mr. Costage filed two Travel Forms for which he received reimbursement of expenses incurred in 1986 and 1987. Although Mr. Costage was not able to say absolutely that the signature on the Travel Forms (Advocate's exhibit 4A and 4B) was his signature, he was also not able to say that it was not his signature and he acknowledged that the signatures could be his. It is, therefore, concluded that the two Travel Forms were signed and submitted by Mr. Costage. This conclusion is further supported by the fact that one other Commissioner witnessed Mr. Costage filing a Travel Form; Although on infrequent occasions a copy of a Travel Form without the back of the form was used by City personnel, it was the prevailing practice, especially of individuals such as Commissioners who were located in City Hall, to file an original three part Travel Form which included the instructions. Secondly, it is inferred from the following that Mr. Costage received instructions from the City Manager shortly after he was elected concerning the City's travel policies, including the policy concerning travel expenses of spouses: It was the City Manager's common practice and procedure to discuss, or cause to be discussed, City policies and procedures, including those governing spouse travel expenses, with all new Commissioners; All of the Commissioners who served during the period of time at issue and who testified in the final hearing, except Mr. Costage, recalled meeting with the City Manager or, at the City Manager's direction, the City's finance director, and discussing travel procedures. All of these Commissioners, except Mr. McLaughlin, recall being told that family travel expenses were to be paid by the Commissioner. Even Mr. McLaughlin admitted that he had been told that travel expenses attributable to his children were to be reimbursed by him. Mr. McLaughlin's testimony that the City policy concerning the payment of spouse travel expenses was not credible, especially in light of the ongoing litigation between Mr. McLaughlin and the City over travel expenses of Mrs. McLaughlin paid for by the City. While on a break during a budget workshop in 1986 or 1987, Mrs. Costage remarked in the presence of Mr. Costage and others that she thought the City should pay for the travel expenses of spouses of Commissioners because of all that the spouses did on behalf of the City. Mr. Costage did not indicate, as he has asserted in this proceeding, that the City already had a policy of paying for spouse travel expenses. The statement is also contrary to Mr. Costage's assertion that he was unaware of the actual policy of the City requiring that Commissioners ultimately pay for their spouse's travel; In 1987, Arthur Levine ran against Alton Dettmer for the position of City Mayor. At some time before the election Mr. Costage advised Mr. Levine to look into Mr. Dettmer's travel expense reports, implying that there was something wrong with the manner in which Mr. Dettmer had been paid for travel expenses. This act by Mr. Costage supports a finding that Mr. Costage was aware that the City had at least some policies governing travel. Benefit of Spouses Travel Expenses to Mr. Costage. Based upon the conclusion that Mr. Costage was aware that the City's policy required that he pay for Mrs. Costage's travel expenses and the fact that Mr. Costage did not pay for almost $3,000.00 in expenses incurred during the period March, 1986 through November 20, 1989, until February, 1991, it is concluded that Mr. Costage was aware that his failure to pay Mrs. Costage's travel expenses would be a financial benefit to him.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Commission on Ethics enter a Final Order and Public Report finding that the Respondent, George Costage violated Section 112.313(6), Florida Statutes, as alleged in Complaint No. 91-37. It is further RECOMMENDED that Mr. Costage be publicly censured and reprimanded. It is further RECOMMENDED that Mr. Costage be required to pay a civil penalty of $3,000.00. DONE and ENTERED this 24th day of September, 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 24th day of September, 1992. APPENDIX Case Number 92-1007EC 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 Recommended 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 Advocate's Proposed Findings of Fact A 1 2. 2 3. 3 5. 4 19. 5 12. B 1 4. 2-4 6. 5 7. 6 8. 7 14-15. 8 9. 9 Hereby accepted. 10 9. 11 33. 12 10. C 1 20-21. 2 22. 3 23. 4 24. 5 25. 6 Hereby accepted. 7 25. 8 26. 9 See 27. 10 27. 11 28. The last sentence is hearsay. 12 29. D 1-2 33(a) and hereby accepted. 3-5 33(b). 6 Hereby accepted. 7 31-32 and 33(b). 8 33(b). 9 Hereby accepted. 10 33(c). Not supported by the weight of the evidence. Hereby accepted. 13 33(d). 14 33. Mr. Costage's Proposed Findings of Fact Mr. Costage's proposed "Findings of Fact" consists primarily of a summary of the testimony of the witnesses and not the ultimate facts which the testimony may support. In large part, the summary of testimony is accurate. It has been noted below where testimony has been mischaracterized or where the testimony does not support the ultimate fact which the testimony may or may no support. Advocate's Witnesses: Constitutes a generally accurate summary of testimony. Constitutes a generally accurate summary of testimony. The second sentence is not, however, relevant. The suggestion in the next to the last sentence that "no reimbursement was sought" is not supported by the weight of the evidence. Constitutes a generally accurate summary of testimony. The last sentence is not relevant and/or is not supported by the weight of the evidence. Constitutes a generally accurate summary of testimony. Whether Mr. Caldemeyer's testimony was "repetitious" is not relevant. Constitutes a generally accurate summary of testimony. Constitutes a generally accurate summary of testimony. The last sentence is hearsay. Mr. Costage's Witnesses: Constitutes a generally accurate summary of testimony. Ms. Adkins testimony involved a period of time subsequent to the period of time at issue in this proceeding. Consequently, her testimony was not of much relevance. Nor was her testimony concerning what others did supported by the weight of the evidence. Not supported by the weight of the evidence. Constitutes a generally accurate summary of testimony. Mr. Costage's testimony was generally not supported by the weight of the evidence or was not relevant. The first three sentences are not supported by the weight of the evidence. The fourth sentence has been generally accepted in finding of fact 14. The fifth through seventh sentences are not relevant. With regard to the last sentence, see findings of fact 24- 29. Mr. Costage's proposed findings of fact end on page 7 of Mr. Costage's proposed recommended order. Beginning on page 7, Mr. Costage has provided argument and conclusions of law. COPIES FURNISHED: Virlindia Doss Assistant Attorney General Department of Legal Affairs The Capitol, Suite 101 Tallahassee, Florida 32399-1050 George A. Routh, Esquire George A. Routh, P.A. 1446 Court Street Clearwater, Florida 34616 Bonnie J. Williams, Executive Director Commission on Ethics The Capitol, Room 2105 P. O. Box 6 Tallahassee, Florida 32302-0006
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: At all relevant times, respondent, Passport Internationale, Inc. (Passport or respondent), was a seller of travel registered with the Department of Agriculture and Consumer Services (Department). As such, it was required to post a performance bond with the Department conditioned on the performance of contracted services. In this case, petitioner, Edmund Houze, has filed a claim against the bond for $348.00 alleging that Passport failed to perform on certain contracted services. In response to a promotion run by an Augusta, Georgia merchant, petitioner filled out a card for a "free" trip to the Bahamas, plus four days accommodation in Daytona Beach and Orlando. Thereafter, he was contacted by Caribbean Sun Tours (CST), a telemarketeer operating out of Tampa, Florida. During his conversation with a CST representative, petitioner was told that if he could not confirm his requested travel dates, his money would be refunded. On November 6, 1990, petitioner agreed to buy a travel certificate entitling the holder to a five-day, four-night vacation package to the Bahamas, plus four nights lodging in Florida. The certificate cost $399.00, and petitioner sent a check in that amount to CST. The certificate issued by CST carried the name, address and logo of Passport. At hearing, Passport contended that CST had "got hold" of some of Passport's travel certificates from another telemarketeer and was reselling them to travelers without Passport's authorization. Passport conceded, however, that it honored all certificates sold by CST, including petitioner's certificate. Accordingly, it is found that CST was acting as an agent on behalf of Passport. On June 1, 1991, petitioner sent Passport a deposit in the amount of $140.00 with his reservation for the cruise and land accommodations. He selected August 5-8, 1991, as the dates on which he desired to travel to Florida. He was told by Passport that the dates were unavailable. Further efforts by petitioner to find an acceptable date for travel were unsuccessful. At that point, and consistent with the representation made by Passport's agent, petitioner requested a refund of his money. He also filed a complaint with the Department. Passport agreed to refund petitioner the $140.00 deposit. Passport has denied liability for the remaining $348.00 on the theory that CST never sent it the money, and that company has gone out of business.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the claim of petitioner against the bond of respondent be granted, and that he be paid $348.00. DONE AND ENTERED this 12th day of December, 1994, in Tallahassee, Florida. DONALD R. ALEXANDER 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 12th day of December, 1994. COPIES FURNISHED: Edmund Houze Route 1, Box 481 Reidsville, Georgia 30453 Michael J. Panaggio 2441 Bellevue Avenue Daytona Beach, Florida 32114 Robert G. Worley, Esquire 515 Mayo Building Tallahassee, Florida 32399-0800 Honorable Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, Florida 32399-0810 Richard D. Tritschler, Esquire The Capitol, PL-10 Tallahassee, Florida 32399-0810
The Issue At issue is whether respondent committed the offense alleged in the petitioner's "notice of intent to impose administrative fine and to issue cease and desist order" and, if so, what administrative action should be taken.
Findings Of Fact Petitioner, Department of Agriculture and Consumer Services, is a state agency charged, inter alia, with administering and enforcing the provisions of Chapter 559, Part XI, Florida Statutes, regulating "sellers of travel." Here, petitioner has charged that respondent had operated as a "seller of travel" without being registered as required by Section 559.927(2), Florida Statutes. The only proof offered to support such contention at hearing was a written inspection report prepared by James Kelly, an inspector employed by petitioner. 1/ That report recited that Mr. Kelly performed an inspection of respondent's premises on November 4, 1994, that he met with Denise Arencibia (who was later identified as respondent's vice president), and that the following events transpired: Went in undercover and asked about weekend cruises. Denise gave me a brochure for the Seaward & gave me prices at $329 per person. She can make all arrangements. They will accept a cashier's check payable to Escape Travel Services. Mr. Kelly did not, however, appear at hearing or otherwise offer testimony in this case. Consequently, for the reasons discussed in the conclusions of law, there is no competent proof of record to support a finding that respondent operated as a "seller of travel" on the date of Mr. Kelly's inspection as contended by petitioner.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be rendered dismissing the charges against respondent. DONE AND ENTERED this 12th day of September 1995 in Tallahassee, Leon County, Florida. WILLIAM J. KENDRICK 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 12th day of September 1995.
The Issue The issue is whether Petitioner is entitled to his claim against Respondent’s security deposit posted with the Department of Agriculture and Consumer Services.
Findings Of Fact Based on the evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made: On July 30, 2019, Michael and Barbara Warren, a retired couple living in Clermont, attended a “Vacation Seminar” sponsored by Vacations Plus Travel, a North Carolina based company that operates as an alter ego of Luxury Vacations, which is based in Florida. The seminar was staged in a conference room of the Hampton Inn in Clermont. The Warrens were lured by the promise of a free cruise if they listened to a sales presentation by representatives of Vacations Plus Travel. Mr. Warren testified that they were subjected to intense sales pressure to buy a software license that they were told would give them access to “true wholesale prices” on all their travel needs, from transportation to lodging, for the rest of their lives. The price of the license was in excess of $7,000, but the salesman promised it would more than pay for itself in savings. Mr. Warren placed the full purchase amount of $7,593.00 on a credit card. The “Reservation Services License Agreement” signed by the Warrens stated in bold type: Assuming the Licensee(s) has not accessed any benefits and has returned all materials delivered to them at closing, the Licensee(s) has the right to rescind this transaction within a period of three (3) days by sending notice of cancellation via certified mail, return receipt requested. Almost immediately after leaving the seminar, the Warrens regretted their purchase. They began calling the toll free phone number listed in their purchase documents to cancel the contract. No one ever answered the phone. Ms. Warren testified that she managed to leave a voice message stating that they wished to cancel the contract but the call was never returned. The Warrens did not send a notice of cancellation via certified mail. Mr. Warren testified that on August 19, 2019, he received an email from Luxury Vacations with instructions on using its website, including a password. Mr. Warren testified that he signed onto the website but that it was not functional. There was a home page, but clicking on any of the proffered links returned only a blank page. Mr. Warren stated that he and his wife were away from home for a time after August 19, 2019, and took no further action either to cancel the contract or use the website. When they came home, the Warrens again signed onto the Luxury Vacations website and this time found it to be functional. Mr. Warren testified that the website was not at all what was promised at the seminar in Clermont. The website was essentially a presentation of advertisements for vacation rentals, minus any information on price comparisons that would enable the Warrens to determine the savings they might realize by booking through the Luxury Vacations site. The properties themselves were also not to the Warrens’s liking. Mr. Warren testified that he and his wife decided they would never recoup the cost of the license and again attempted to cancel by phoning the number provided with their contract materials. Again, they were unable to speak to anyone or get any kind of response from Luxury Vacations. The Warrens sent a letter to Luxury Vacations, via certified mail, on August 27, 2019, informing the company of their inability to use the website and requesting cancellation of the contract. They heard nothing from the company. Having failed to cancel the contract by direct means, the Warrens contacted their credit card company to dispute the transaction. Blake Adams, the CEO of Luxury Vacations, testified that the company was “blindsided” by the Warrens’s dispute of the credit card charges because up to that point the company had heard nothing from the Warrens. As adamantly as Mr. Warren testified that he and his wife made repeated efforts to contact the company, Mr. Adams just as adamantly testified that the company had no record of any calls from the Warrens and no correspondence of any kind prior to receiving the notice of dispute from the credit card provider. Luxury Vacations provided sufficient information to the credit card provider to uphold the purchase and receive the funds for the Warrens’s license purchase. The Warrens’s cancellation letter had been misdelivered and did not reach Luxury Vacations until September 16, 2019. A December 31, 2020, letter to the Warrens from Stephanie Sorrentino, an employee of Luxury Vacations, states that upon receiving the cancellation letter, the company contacted the Warrens to explain that their account was active and to inform them of how to use the services they had purchased. The Warrens denied ever being contacted by Ms. Sorrentino or anyone else from Luxury Vacations. Mr. Warren timely filed the claim for $7,593.00 against the performance bond with the Department on or about September 25, 2019. Mr. Adams testified that Mr. Warren’s testimony about seeing only advertisements on the Luxury Vacations’ website showed that Mr. Warren was never actually logged into the website. Mr. Adams stated that the splash page of the website includes advertising, but that once the user logs into the licensed portion of the site there are no advertisements. Mr. Warren testified that he is a retired engineer and circuit designer and is perfectly capable of signing on to a website. The parties also disputed the events of July 31, 2019, the day after the Warrens signed the contract with Luxury Vacations. Mr. Adams testified that his company was at the Hampton Inn in Clermont all day on July 31, 2019, presenting another sales seminar. He stated that the Warrens could have come to the Hampton Inn and discussed rescission of their contract with the on-site representative of the company. Ms. Warren testified that she in fact went back to the Hampton Inn on July 31, 2019, and that no one from Luxury Vacations was there. Mr. Adams testified that the Warrens have an active contract with Luxury Vacations and the company remains ready to assist the couple in achieving the savings promised at the sales seminar. In summary, the Warrens present a sympathetic case. They were subjected to a high-pressure sales pitch and succumbed. Once away from the pressurized sales environment, they regretted their purchase and took some steps to rescind it. They repeatedly phoned the number provided by Luxury Vacations. However, the one thing they did not do was take the action specifically set forth in the contract they had just signed: send notice of cancellation within a period of three days via certified mail, return receipt requested. They waited until August 27, 2019, to send a written notice of cancellation to Luxury Vacations. Section 559.929(2) provides that the performance bond at issue in this proceeding must be in favor of the Department and is for “the use and benefit of a consumer who is injured by the fraud, misrepresentation, breach of contract, or financial failure, or any other violation of this part by the seller of travel.” There is no evidence that Luxury Vacations committed fraud, misrepresentation, or that it breached its contract with the Warrens. Luxury Vacations did not fail financially. Therefore, the Warrens may only succeed in claiming against the bond by showing that Luxury Vacations violated part XI of chapter 559. At the hearing, the undersigned raised the possibility that section 559.932, titled “Vacation Certificate Disclosure,” might apply in this case. Respondents argued that this statute did not apply because Luxury Vacations does not sell “vacation certificates,” which are defined in section 559.927(14) as: any arrangement, plan, program, vacation package, or advance travel purchase that promotes, discusses, or discloses a destination or itinerary or type of travel, whereby a purchaser is entitled to the use of travel, accommodations, or facilities for any number of days, whether certain or uncertain, during the period in which the certificate can be exercised, and no specific date or dates for its use are designated. A vacation certificate does not include prearranged travel or tourist-related services when a seller of travel remits full payment for the cost of such services to the provider or supplier within 10 business days of the purchaser’s initial payment to the seller of travel. The term does not include travel if exact travel dates are selected, guaranteed, and paid for at the time of the purchase. Respondents were correct that the software license at the heart of the contract between the Warrens and Luxury Vacations did not meet the definition of a “vacation certificate.” However, the undersigned raised the possibility that the statutory language of section 559.932 reaches more than vacation certificates, in spite of its title: A seller of travel must provide each person solicited with a contract that includes the following information, which shall be in 12-point type, unless otherwise specified…. The quoted language does not appear confined to sales of vacation certificates but applicable to any solicitation by a “seller of travel” such as Luxury Vacations. Part of the information that must be included in the contract is the following: (h) In immediate proximity to the space reserved in the contract for the date and the name, address, and signature of the purchaser, the following statement in boldfaced type of a size of 10 points: “YOU MAY CANCEL THIS CONTRACT WITHOUT ANY PENALTY OR OBLIGATION WITHIN 30 DAYS FROM THE DATE OF PURCHASE OR RECEIPT OF THE VACATION CERTIFICATE, WHICHEVER OCCURS LATER.” “YOU MAY ALSO CANCEL THIS CONTRACT IF ACCOMMODATIONS OR FACILITIES ARE NOT AVAILABLE PURSUANT TO A REQUEST FOR USE AS PROVIDED IN THE CONTRACT.” “TO CANCEL THIS AGREEMENT, A SIGNED AND DATED COPY OF A STATEMENT THAT YOU ARE CANCELING THE AGREEMENT SHOULD BE MAILED AND POSTMARKED, OR DELIVERED TO (NAME) AT (ADDRESS) NO LATER THAN MIDNIGHT OF (DATE) .” Respondents conceded that if this provision were applicable in the instant case, and Luxury Vacations had been required to give the Warrens 30 days in which to cancel their contract, then the Warrens’s August 27, 2019, cancellation letter was timely. However, Respondents continued to argue that section 559.932, taken as a whole, is plainly intended to apply only to contracts for vacation certificates. After careful review of the statute and the Proposed Recommended Order of American Contractors Indemnity Company, the undersigned is persuaded that Respondents have read section 559.932 correctly. The statute provides ten discrete provisions that a contract must contain, most of which are clearly directed to the terms and conditions for stays at specific destinations. Nearly all of these provisions would be inapplicable to the software licensing contract but would nonetheless be mandatory if section 559.932 applied to this contract. Further indication that the 30-day notice requirement is applicable only to vacation certificates is section 559.933, titled “Vacation certificate cancellation and refund provisions,” subsection (1)(a) of which provides: A seller of travel or an assignee must honor a purchaser’s request to cancel a vacation certificate if such request is made: (a) Within 30 days after the date of purchase or receipt of the vacation certificate, whichever occurs later…. Section 559.933 is replete with references to the 30-day cancellation requirement and is clearly limited to vacation certificates. Aside from the 30-day cancellation period for vacation certificates, part XI of chapter 559 appears to mandate no specific time period for cancellations of contracts. Looking farther afield, the Federal Trade Commission’s “Cooling Off” rule, 16 C.F.R. § 429, gives a consumer in the Warrens’s position three days to cancel a sale. Sections 501.021-.055, Florida Statutes, provide substantially the same right to cancel a “home solicitation sale,” which by definition includes the transaction at issue in this proceeding. See § 501.021(1), Fla. Stat. Luxury Vacations’ notice of cancellation rights did not comply fully with the letter of section 501.031, which provides: Every home solicitation sale shall be evidenced by a writing as provided in this section. In a home solicitation sale, the seller must present to and obtain from the buyer his or her signature to a written agreement or offer to purchase which designates, as the date of the transaction, the date on which the buyer actually signs and which contains a statement of the buyer’s rights, which statement complies with subsection (2). The statement must: Appear under the conspicuous caption, “BUYER’S RIGHT TO CANCEL”; Read as follows: “This is a home solicitation sale, and if you do not want the goods or services, you may cancel this agreement by providing written notice to the seller in person, by telegram, or by mail. This notice must indicate that you do not want the goods or services and must be delivered or postmarked before midnight of the third business day after you sign this agreement. If you cancel this agreement, the seller may not keep all or part of any cash down payment.” The Luxury Vacations’ contract provision was not consistent with section 501.031. It did not include a “conspicuous caption” of “BUYER’S RIGHT TO CANCEL” in all capital letters. It did not include the statutory language verbatim. The cancellation language in the Luxury Vacations’ contract was printed in bold type but no larger than the other language and was not on the page signed by the Warrens. The Luxury Vacations’ cancellation clause limited the exercise of the cancellation right to written notice via certified mail; the statute provides that the buyer may cancel in person, by telegram, or by mail. The relevant statutes provide that any person making home solicitation sales must first obtain a permit from the clerk of the court of the county in which the sales are to take place. § 501.022(2), Fla. Stat. The clerk of the court may revoke, suspend, or deny issuance of a home solicitation sales permit for failure to comply with any provision of sections 501.021-.055. § 501.022(4), Fla. Stat. The Attorney General or a state attorney may initiate proceedings to enjoin any person found to be violating the provisions of sections 501.021-.055. § 501.052, Fla. Stat. There are criminal penalties that attach to violations of the cited sections. See § 501.055, Fla. Stat. However, the home solicitation sales statutes are silent as to any direct remedy that a consumer may pursue for the failure of a home solicitation seller to abide by the notice provision of section 501.031. Also, the terms of the performance bond statute limit consumer claims to violations of part XI of chapter 559. The undersigned was unable to find a provision of part XI that would encompass the home solicitation seller’s cancellation notice requirements.1
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Agriculture and Consumer Services issue a final order denying Michael Warren’s claim of $7,593.00 against the performance bond of Luxury Vacations in Paradise, Inc. DONE AND ENTERED this 9th day of April, 2021, in Tallahassee, Leon County, Florida. COPIES FURNISHED: Blake Adams Luxury Vacations in Paradise, Inc. #219 5379 Lyons Road Coconut Creek, Florida 33073 Michael Cole Warren 2869 Highland View Circle Clermont, Florida 34711 Honorable Nicole “Nikki” Fried Commissioner of Agriculture Department of Agriculture and Consumer Services The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810 S LAWRENCE P. STEVENSON Administrative Law Judge 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 9th day of April, 2021. W. Alan Parkinson, Bureau Chief Bureau of Mediation and Enforcement Department of Agriculture and Consumer Services Rhodes Building, R-3 2005 Apalachee Parkway Tallahassee, Florida 32399-6500 Garen H. Kasparian, Esquire American Contractors Indemnity Company 801 South Figueroa Street Los Angeles, California 90017 Steven Hall, General Counsel Department of Agriculture and Consumer Services 407 South Calhoun Street, Suite 520 Tallahassee, Florida 32399-0800
