The Issue At issue in this case is whether respondents committed the offenses alleged in the Administrative Action, and, if so, the penalty which should be imposed.
Findings Of Fact At all times material to this case, respondents held alcoholic beverage license number 60-05592, series 2-APS, for use at the premises of K Beverage & Food, located at 2511 West Gate Avenue #9, West Palm Beach, Florida. This license was issued November 18, 1991, by the Florida Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco. On or about August 22, 1991, K Beverage & Food was authorized by the United States Department of Agriculture, Food and Nutrition Service ("F.N.S."), to accept food stamps. In the application, respondents, acting through Mr. Hassan, acknowledged that they had read and fully understood the Food Stamp Program regulations. As part of the authorization process, Mr. Hassan attended a meeting and education course on the Food Stamp Program regulations applicable to retail grocers, and he signed an acknowledgment that he understood these regulations. The F.N.S. Compliance Section routinely conducts investigations of authorized stores to ensure compliance with all applicable federal rules and regulations. The compliance investigation of K Beverage & Food commenced on March 31, 1993, when Senior Investigator Rene Berlingeri entered the store at approximately 2:30 p.m. A man was working at the checkout counter when Mr. Berlingeri brought three food and four non-food items to the counter for purchase. The clerk rang up the total price for the seven items. Mr. Berlingeri offered food stamps in payment, and the clerk accepted them without comment. The clerk put the food stamps in the drawer of the cash register. On April 8, 1993, Mr. Berlingeri visited K Beverage & Food for the second time. The store clerk at that time was a woman who identified herself as Isabel. Mr. Berlingeri again selected three food and four non-food items for purchase. Isabel rang up the total price for the seven items and, without comment, accepted food stamps as payment. On April 13, 1993, Mr. Berlingeri visited K Beverage & Food; Isabel was the clerk on duty. He selected three food items and four non-food items. Isabel rang up the total price of the seven items and again, without comment, accepted food stamps as payment. As she was bagging his purchases, Mr. Berlingeri selected a six-pack of beer, and, without comment, Isabel accepted food stamps as payment. On April 15, 1993, Mr. Berlingeri visited K Beverage & Food. Isabel was again working as clerk. He selected one food item and three non-food items, including a six-pack of beer. Isabel accepted food stamps as payment for the total price of the four items, without comment. Mr. Berlingeri then asked if she would exchange food stamps for cash, and he gave her a book of food stamps with a face value of $50. Isabel gave him $45 in cash from the cash register and put the book of food stamps into the cash register. On April 20, 1993, Mr. Berlingeri entered K Beverage & Food at approximately 10:15 a.m. and asked Isabel if she would purchase $200 worth of food stamps. At Isabel's request, he returned at approximately 11:40 a.m. He gave Isabel food stamps with a face value of $200; she gave him $140 in cash, which she took from under the counter. She told Mr. Berlingeri that, if he ever wanted to exchange more food stamps for cash, he should come to K Beverage & Food at about the same time of day. On July 17, 1993, Mr. Berlingeri made his final investigative visit to K Beverage & Food. The clerk on duty, who identified himself during the transaction as "Sam", gave Mr. Berlingeri $130 in cash in exchange for food stamps with a face value of $200. Sam put the food stamps under the counter, but Mr. Berlingeri did not see the place from which Sam obtained the cash. During the transaction, Sam acknowledged that he knew Isabel; he asked Mr. Berlingeri to keep the transaction confidential. On July 23, 1993, Mr. Berlingeri returned to K Beverage & Food to identify the persons involved in the food stamp transactions. The clerk on duty told Mr. Berlingeri that the owner of K Beverage & Food had another store, called A1A Food Discount Beverage, and Mr. Berlingeri went there. He approached a woman who identified herself as Sandra Marcel Hassan; Mr. Berlingeri verified the identification from a Florida driver's license. While Mr. Berlingeri was in A1A Food Discount Beverage, the person known to him as "Isabel" came into the store. She produced a Florida driver's license that identified her as Maria Isabela Besola. The clerk that Mr. Berlingeri dealt with at K Beverage & Food in March and the clerk who took part in the July 17 transaction were not identified. During the period in which the transactions set out in paragraphs 3 through 9 occurred, Mr. Hassan was present at K Beverage & Food only in the mornings, when he prepared the bank deposit, and in the afternoons after 5:00 p.m., when he came in to work. Mr. Hassan was not present in the store when any of the transactions at issue occurred, nor was there evidence that respondent Sandra M. Bomio Hassan was present at K Beverage & Food at any of the times relevant to this case. Respondents knew that it is a violation of Food Stamp Program regulations for a retail food store to accept food stamps in exchange for ineligible, non-food items and in exchange for cash. Six violations occurred at K Beverage & Food over a period of 21 days, with a seventh violation occurring 60 days later, and three different clerks were involved in the violations. The repeated violations were conducted in an open and flagrant manner. Even though respondents were not on the premises when the violations occurred, it may be reasonably concluded that, due to the number of violations and the open manner in which they occurred, respondents condoned or negligently overlooked the violations by failing to exercise due diligence in supervising their employees and in monitoring the licensed premises.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco, enter a Final Order finding respondents Sandra M. Bomio and Hapy Hassan, d/b/a K Beverage & Food, guilty of violating section 561.29(1)(a), Florida Statutes, and imposing an administrative fine in the amount of $1,000. DONE AND ENTERED this 31st day of May 1995, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 31st day of May 1995.
Findings Of Fact On May 8, 1986, Petitioner filed with the Department of Revenue, as agent for the Comptroller, an application for documentary stamp tax refund in the amount of $16,125.00. Subsequently, the Department of Revenue recommended that the application be denied and on November 24, 1986, the Comptroller issued an Order denying the application. Thereafter Petitioner duly requested an Administrative Hearing pursuant to the provisions of Chapter 120, Florida Statutes, and such hearing was duly conducted by William J. Kendrick, Hearing Officer for the Division of Administrative Hearings, on April 13, 1987, in Tallahassee, Florida. On June 10, 1987, Hearing Officer Kendrick issued his Recommended Order in which he separately stated Findings of Fact and Conclusions of Law and recommended that the application be approved. Copies of that Recommended Order have been furnished to all parties. Petitioner has filed no exceptions to the Recommended Order as of the date hereof, however, the Assistant Attorney General, representing the Comptroller in this matter, has filed exceptions to paragraph 5 of the hearing officer's Conclusions of Law which reads as follows. The tax imposed by Section 201.08, Florida Statutes, is levied on a written obligation to pay money, not on a security interest. Under the provisions of Section 201.09(2), a security interest (mortgage) is not subject to taxation if the written obliga- tion to pay money (promissory note) is exempt from the tax. Therefore, whether the transac- tion is exempt is dependent upon whether there was any material change in the promissory note and the renewal note, and not whether there as any material change in the mortgage. Since, in the instant case, there was no material change between the original promissory note and the renewal note, it follows that the subject transaction is exempt from the tax levied by Section 201.08, Florida Statutes. The Findings of Fact as determined by the Hearing Officer were by stipulated agreement of the parties filed with the hearing officer on June 8, 1987. Those findings are adopted as the Findings of Fact for this Order and were as follows: On February 2, 1981, a Mortgage and Security Agreement was signed by the proper corporate officers of SNW Corp. ("SNW"), PNW Corp ("PNW"), and KNW Corp. ("KNW"), all Florida Corporations securing a Note in the amount of $22,000,000.00 upon which documen- tary and intangible taxes were paid. On October 1, 1983, an Amendment to the Mortgage was signed by the appropriate corporate officers of SNW, PNW AND KNW. No documentary stamps were affixed to this document. On March 13, 1986, a Second Amend- ment to Mortgage and Security Agreement (the "Second Amendment") was signed by the appro- priate corporate officers of SNW, PNW, KNW, and Kenneth Wolofsky, Individually and as Trustee. The Second Amendment refers to the Mortgage and was intended to "secure that certain Renewal Note" from SNW, PNW AND KNW in the amount of $10,000,000.00. The Renewal Note was executed by Kenneth Wolofsky solely in his corporate capacity on behalf of KNW not individually or as trustee. Petitioner, Chicago Title Company, was acting in its capacity as agent for the borrowers and was responsible for having the Second Amendment to Mortgage and Security Agreement dated March 13, 1986, recorded. Documentary stamps were paid under protest upon recordation of the Second Amend- ment in the amount of $16,125.00. Petitioner filed an Application for Refund from the State of Florida for the documentary stamps paid on the Second Amend- ment which was denied by the Comptroller of the State of Florida. Thereafter, the Peti- tioner sought an administrative hearing.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That Petitioner's request for refund in the sum of $16,125.00 be GRANTED. DONE AND ORDERED this 10th day of June, 1987, in Tallahassee, Florida. WILLIAM J. KENDRICK Hearing Officer Division of Administrative Hearings The Oakland Building 2900 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 10th day of June, 1987. APPENDIX Petitioner's proposed findings of fact 1-6 are addressed in paragraphs 1-6, respectively. Respondent's proposed findings of fact 1-6 are addressed in paragraphs 1-6, respectively. COPIES FURNISHED: Warren R. Tranzenfeld, Esquire Kirkpatrick & Lockhart 1428 Brickell Avenue Forth Floor Miami, Florida 33131 Alan Burns, Esquire Department of Legal Affairs Tax Section, Capitol Building Tallahassee, Florida 32399-1050 Honorable Gerald Lewis Comptroller, State of Florida The Capitol Tallahassee, Florida 32399-0305 =================================================================
The Issue Whether the petitioners are entitled to a refund of the documentary stamp taxes paid on a Special Warranty Deed conveying real property from the Federal Home Loan Mortgage Corporation to one of the petitioners.
Findings Of Fact Based on the facts alleged in the petition for administrative hearing, the responses to requests for admission, and the facts stipulated to at the hearing on the motion for recommended summary final order, the following findings of fact are made: On September 27, 1994, Freddie Mac conveyed to Abe Saada by a Special Warranty Deed real property located in Dade County, Florida. Regina Saada is not a party to the Special Warranty Deed. The U.S. Department of Housing and Urban Development Settlement Statement prepared for the closing on the property showed that $9,600.00 in "state tax/stamps" was owed on the deed, of which $4,800.00 was to be paid from the funds of the seller, Freddie Mac, and $4,800.00 was to be paid from the funds of the borrower, Abe Saada. Pursuant to its agreement with Mr. Saada, Freddie Mac paid $9,600.00 to the Clerk of Court as the documentary stamp tax on the deed on or about September 28, 1994. The deed was recorded in the Dade County Official Records at Book 16525 at pages 3583-3585. Abraham Saada is not exempt from the documentary stamp tax.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a Final Order dismissing the Petition for Chapter 120 Administrative Hearing to Contest Denial of Stamp Tax Refund filed by Abraham Saada and Regina Saada. DONE AND ENTERED this 8th day of May, 1997, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 8th day of May, 1997.
Findings Of Fact By warranty deed dated July 29, 1974 Marco Cove, Inc. conveyed certain property to the Barnett Bank of Naples, Florida as Trustee. At the time of these conveyances the properties were subject to a first mortgage dated September 14, 1971 in an original principal amount of $1,400,000 to AMI Investments, Inc. mortgagee and a second mortgage dated August 24, 1973 in the amount of $130,278 to Joseph R. Lynch, Inc. By quitclaim deed dated November 5, 1974 (Exhibit 8) Donald P. Landis conveyed his interest in Apartment Number C-3 in the condominium here involved to the Barnett Bank of Naples, Trustee. It appears that at the time of the conveyances here involved Marco Cove, Inc. was delinquent on both mortgages, owed materialmen's liens on the property, had sold some of the units to innocent purchasers without giving clear title, and had not placed in escrow the sums so received from these purchasers. Barnett Bank accepted title as trustee, so the various rights of the parties could be resolved without foreclosure proceedings. Although Petitioner contested that Barnett Bank was Trustee for AMI Investments, Inc., Exhibit 10, which was admitted into evidence without objection, clearly shows the bank understood they were trustees for AMI Investments, Inc. and accepted the deeds here involved. At the time of the conveyances the balance owned on the first mortgage was $63,356.16 and on the second mortgage $130,278. Respondent's third Notice of Proposed Assessment (Exhibit 3) assesses documentary stamp taxes and penalties in the amount of $59.25 on each of the three condominium units conveyed to the Trustee and documentary stamp tax and penalty in the amount of $547.88 on the conveyance of the entire condominium for a total tax and penalty of $725.63. No surtax is claimed. The conveyances to the Trustee did not extinguish the mortgages and the Trustee took title to the properties subject to these mortgages. Petitioner has subsequently sold its rights as first mortgagee to a third party for some $66,000.
Findings Of Fact Respondent, Angel Portillo d/b/a Zippo's, is an alcoholic beverage licensee holding beverage license no. 39-518, Series 2-COP, issued by Petitioner. Zippo's is located at 1220 West Platt Street, Tampa, Hillsborough County, Florida. At all times pertinent to this cause Margaret Frey was employed as a barmaid at Zippo's. Billy M. Brown was at all time pertinent to this cause a special agent for the United States Department of Agriculture. David Menendez was at all times pertinent to this cause an investigative aide for the United States Department of Agriculture. Also, at all times pertinent Menendez was under the supervision and direction of Brown. Between June 18 and July 10, 1980, Brown and Menendez conducted an undercover investigation at Zippo's concerning allegations of food stamp fraud or trafficking in food stamps. At all times pertinent to this cause, Zippo's was not authorized by the United States Department of Agriculture to receive or redeem food stamps issued by the United States Government. On June 18, 1980, Margaret Frey, while on duty at Zippo's, purchased one hundred fifteen (115) dollars worth of food stamps from Menendez for sixty five (65) dollars cash. On this occasion, Menendez was accompanied by Brown. On June 23, 1980, Frey, while on duty at Zippo's, purchased two hundred ten (210) dollars worth of food stamps from Menendez for one hundred (100) dollars cash. Menendez was again accompanied by Brown. On June 30, 1980, Frey, while on duty at Zippo's, purchased five hundred thirty (530) dollars worth of food stamps for two hundred (200) dollars cash from Brown. On July 7, 1980, Frey, while on duty at Zippo's, purchased five hundred twenty (520) dollars worth of food stamps for two hundred fifty (250) dollars from Brown. However, the transaction was executed at an apartment next door to Zippo's. On July 10, 1980, Frey, while on duty at Zippo's, purchased five hundred twenty five (525) dollars worth of food stamps for two hundred fifty (250) dollars cash from Brown. Portillo apparently had no actual knowledge of Frey's actions as he held a full-time job with a vending company during all times pertinent to this case. At all times pertinent to this cause, Respondent Portillo was absent from the licensed premises. Portillo's testimony established that he is only at Zippo's in the morning prior to opening, at shift change each afternoon (approximately 4:00 p.m.) and at closing time in the late evening or early morning. At all times pertinent to this cause, Margaret Frey was the only employee of Zippo's on the licensed premises. Frey initially testified that funds to purchase the food stamps ($865 total) were personal funds. She subsequently testified that her former husband provided some of the funds for these purchases and later testified that some of the funds for the purchase of food stamps came from a joint account she and her former husband had established at Freedom Federal in Tampa, Florida. Frey redeemed a portion of the food stamps purchased from Menendez and/or Brown at a grocery store nearby Zippo's, which grocery store was also owned by Respondent. This grocery store is and was at all times pertinent to this cause a retail store authorized to accept and redeem food stamps. Although Frey claimed that all purchases of food stamps made by her were conducted in a secretive fashion, Menendez's testimony established that on June 18, 1980, her purchase of one hundred fifteen (115) dollars worth of food stamps from him was conducted openly with said transaction made across the bar. As a result of the food stamp purchases discussed above, Frey was arrested and charged with violations of Federal Law by knowingly receiving food stamps in a manner not authorized by the Food Stamp Act of 1964, as amended. She was subsequently adjudicated guilty of these violations.
Recommendation From the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Respondent be found guilty of the allegations contained in Counts 1, 2, 3 and 5 of the Administrative Complaint. It is further RECOMMENDED that Respondent's alcoholic beverage license no. 39-518 be suspended for a period of 14 days. DONE and ENTERED this 14th day of July, 1982 at Tallahassee, Florida. R. T. CARPENTER, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 14th day of July, 1982. COPIES FURNISHED: John A. Boggs, Esquire Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Robert A. Herce, Esquire HERCE & MARTINEZ Pan American Center Building A 4602 N. Armenia Avenue Tampa, Florida 33603 Gary A. Rutledge, Secretary Department of Business Regulation 725 Bronough Street Tallahassee, Florida 32301 Charles A. Nuzum, Director Division of Alcoholic Beverages and Tobacco Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301
The Issue There are two issues raised in this case: Whether the transaction evidenced by the written instrument is taxable-under provisions of Sections 201.08, F.S., 201.01 and 201.08(1), F.S.; and Whether the amendment to the note and mortgage involved in this case is a promissory note taxable pursuant to Section 201.08(1), F.S.
Findings Of Fact There are two issues raised in this case: Whether the written document which evidences the transaction is taxable under the provisions of Sections 201.01 and 201.08(1), F.S.; and Whether the amendment to the note and mortgage involved in this case is a promissory mote or written obligation to pay money and taxable pursuant to Section 201.08(1), F.S. The facts are that on February 28, 1974, the Petitioners, except for Joe R. Hughes, III, and W. Comer Cherry, executed a promissory mote to Lewis State Bank for $405,000 with interest at 10 percent per annum, payable monthly, beginning March 1, 1974, with the entire amount of the principle ($405,000) due on or before February 28, 1975. Said Petitioners executed a mortgage to Lewis State Bank as security for said loan. On April 8, 1975, the due date of the principle was extended to August 28, 1975. The Lewis State Bank then assigned the note and mortgage to Thomas County Federal on July 7, 1975. On July 2 and July 7, 1975, the Petitioners including Hughes and Cherry, but not Rainey, signed the instrument in Tallahassee, Florida, upon which the tax being challenged is assessed. Rainey took the instrument which appears on its face to be an Amendment to the aforementioned Note and Mortgage dated February 28, 1974, to Thomas County Federal Savings and Loan, Thomas County, Georgia. The Amended Note and Mortgage was signed by Rainey and accepted by Thomas County Federal as assignee of said original note and mortgage in Thomas County, Georgia, on July 7, 1975. The other obligors who were jointly and severally liable had signed in Florida. See R-16-21. The purpose of the amendment to the note and mortgage was to refinance the Jefferson Towers Apartments project located in Tallahassee, Florida. See R-14. Thereafter, the money was tendered under the Amendment to Note and. Mortgage, in Georgia, by Thomas County Federal to the agent of the borrowers [Petitioners] Rainey. R-14. The Petitioners, on July 8, 1975, in Leon County, recorded the amendment to note and mortgage, the only instrument reflecting the new outstanding obligation of $412,000 and the only instrument setting forth the Petitioner's promise to pay this new obligation in O. R. Book 724, page 24, et. seq. The Petitioners affixed documentary stamp taxes in the amount of $10.50 on the amendment to the note and mortgage. (See R-21) Whether the instrument entered into between the Petitioners and Thomas County Federal is considered a new obligation or an amendment of the assigned note and mortgage, the essential factors are that the execution and delivery of the instrument, and exchange of the funds therefor occurred in Georgia. Based on the foregoing facts, the Department of Revenue finds as a matter of law that: To be taxed there must be a Florida transaction evidenced by a promissory note or written obligation to pay money. Sec. 201.08(1), F.S. The Amendment to Note and Mortgage involved in this case was made, signed and executed, in the State of Florida, save one signature of the multiple obligors, who were jointly and severally liable and the loan was used in Florida to refinance a Florida project which had been originally financed in Florida. The Amendment to Note and Mortgage, the only instrument reflecting the outstanding obligation of $412,000 and evidencing the Petitioners' promise to pay this new obligation, was recorded in Leon County, Florida, and has all essential factors of a Florida transaction percent thus subject to documentary stamp tax provided for in Sections 201.01 and 201.08(1), F.S. The Amendment to Note and Mortgage clearly evidences a transaction between the Petitioners and Thomas County Federal pursuant to which the Petitioners are obligated to pay suns of money to Thomas County Federal. Such a written obligation to pay money may be exempt if it meets the criteria of Sec. 201.09, F.S. The document in question does not meet the criteria of Sec. 201.09, F.S., because it did not extend or continue only the identical contractual obligations of the original promissory note but there was a substantial change in the principle amount. No documentary stamps have been affixed to the document which was recorded nor is there any notation on the document that said stamps were placed on any other document, except affixing of documentary stamps in the amount of $10.50; therefore, the document in question is subject to tax under Sec. 201.08(1), F.S., in the amount of $607.50 plus penalty at $607.50. Section 201.08(1) and Section 201.17(2), F.S. Regarding the issue of whether the document would have been taxable as an amendment to the original note and mortgage, the Department concurs with the findings of the Hearing Officer that the document does evidence a transaction in which the taxpayer would have been obligated to pay money to the lending institution. Because the principal amount was increased from $406,000 to $412,000 there was a substantial change in principal amount. Therefore, the exemption provision of Section 201.09, F.S., would not apply.
Conclusions The assessment of the Department of Revenue in the amount of $607.50 under Section 201.08(1), F.S., for delinquent documentary stamp taxes on the amendment to Note and Mortgage and the assessment for penalty under Section 201.17(2), F.S., in the amount of $607.50 are valid. CERTIFICATION I certify that the foregoing is the Final Order of the Department of Revenue adopted by the Governor and Cabinet on July 20, 1976. J. Ed Straughn, Executive Director State of Florida Department of Revenue Room 102, Carlton Building Tallahassee, Florida 32304 Dated this 21st day of July, 1976
Recommendation The Hearing Officer recommends based on the foregoing findings fact and conclusions of law, than neither the tax or penalty be assessed. Done and ordered this 10th day of May, 1976, in Tallahassee, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Joseph C. Mellichamp, III, Esquire Assistant Attorney General Attorney for Respondent Department of Legal Affairs The Capitol Tallahassee, Florida 32304 Edgar M. Moore, Esquire Attorney for Petitioner Smith and Moore, P.A. P.O. Box 1169 Tallahassee, Florida 32302 ================================================================= AGENCY FINAL ORDER ================================================================= STATE OF FLORIDA DEPARTMENT OF REVENUE I. RAINEY, JR., et al., Mortgagors; THOMAS COUNTY FEDERAL, Thomasville, Georgia, Mortgagee, Petitioners, vs. CASE NO. 75-1899 DEPARTMENT OF REVENUE, Respondent. /
The Issue The issue is whether the Respondent's certification should be revoked or otherwise penalized based on the acts alleged in the Administrative Complaint.
Findings Of Fact William H. Wood was certified by the Criminal Justice Standards and Training Commission on November 16, 1973, and issued certificate number 02-9291. On September 22, 1986, Wood answered an advertisement in a publication known as Linn's Stamp News. The publication caters to the interests of stamp collectors. The advertisement read as follows: MINT POSTAGE wanted. Ungummed, uncancelled postage under 10 and postage dues - 50%, ungummed, uncancelled postage over 9 , special deliveries, postal stationary and officials - 65%. The advertisement was placed by a Maryland stamp dealer who was assisting United States Postal Service inspectors. The advertisement was placed in an effort to identify persons engaged in the unlawful activity of reuse of previously used postage stamps for mailing. Wood answered the advertisement on September 22, 1986, by letter. He stated in the letter: Sir, you advertised in Linn's Stamp News that you are buying ungummed mint postage. The ad had no shipping instructions. I have the following. A quantity and various denomination of stamps that's listed, with dollar value at the stated percentage in the ad. Please advise shipping instructions. The cooperating stamp dealer forwarded a reply to Wood on September 29, 1986, which indicated a willingness to begin buying stamps from Wood if they were "ungummed, uncancelled." "Ungummed" refers to the condition of a postal stamp which lacks the adhesive backing usually present on unused postage stamps. "Uncancelled" postage refers to stamps which have not been previously utilized to post a letter or a parcel. "Mint" postage refers to stamps which are gummed, uncancelled, and in pristine condition. On October 6, 1986, Wood forwarded about 1800 postage stamps of various denominations with an aggregate face value of about $258.00 to the cooperating Maryland stamp dealer. Soon thereafter, Wood was sent a check for $164.89 in payment for the stamps. Many of the stamps supplied by Wood bore evidence of being previously used to post a letter or a parcel. The cooperating stamp dealer sent a letter to Wood on October 15, 1986, which thanked him for his shipment of stamps and indicated a need for stamps of $100.00 face value per month. The letter also stated that the stamp dealer knew a friend named Jenkins who was in the mail order business and had similar needs for stamps. On January 6, 1987, the cooperating stamp dealer, "Chuck," received another shipment of postage stamps from Wood. "Chuck" forwarded a check payable in the amount of $32.92 to Wood in payment for the receipt of stamps with a face value of $51.00. "Chuck" enclosed a letter to Wood with the check which stated in part: You will notice that it is a J.J. Enterprise check. Jeff has been needing so much of this postage for his business mailings he has been buying most all of my shipment that I get in. Therefore, if you would be kind enough to just send any future shipments directly to his address, I would appreciate it. I will still make my share. Thank you. For your records his address again is Jeff Jenkins, J.J. Enterprises, Box 22015, Baltimore, Maryland 21203. . . . "Jeff Jenkins" is an assumed name of Postal Inspector John T. Evans, acting in an undercover investigative capacity. "J.J. Enterprises" likewise is a fictitious, non-existent business created for purposes of the investigation of Wood by the Postal Service. Subsequent to January 6, 1987, seven more shipments of stamps were received from Wood by postal inspectors. The last arrived on June 16, 1988. In each case, Wood received a check in payment for the stamps. The types of stamps forwarded by Wood in all the shipments would have been of little value for stamp collection purposes. Accordingly, the market value for such a purpose would have been far below the amounts paid to Wood for the stamps. The sum of the face value of the stamps was $753.10. The price paid to Wood was consistent with the value of used stamps which were to be unlawfully reused for postage to lower mailing expenses. In one of the correspondences forwarded by Postal Inspector John Evans, posing as "Jeff Jenkins," Wood was told of a friend, Don Wilson, who lived in Alabama. The Respondent was told that Don Wilson was interested in buying "these type stamps." "Don Wilson" is an assumed name of Postal Inspector Larry Dodson, acting in an undercover investigative capacity. On June 23, 1988, Inspector Dodson telephone Wood, posing as Don Wilson. Inspector Dodson told Wood that he was interested in buying stamps in order to reduce mailing expenses. Wood stated that he would be willing to sell stamps to Don Wilson. On June 29, 1988, Inspector Dodson and four other postal inspectors served a search warrant at Wood's home. The search yielded thirteen shallow plastic trays and a plastic tub of the type used to soak stamps off paper envelopes. Inspector Dodson also found a quantity of stamps which had been removed from the corners of envelopes by soaking. Inspector Dodson found approximately 5100 mailing envelopes utilized by the West Florida Gas Company to receive utility payments. He also located about 1800 mailing envelopes utilized by Gulf Coast Electrical Cooperative to receive utility payments. The utilities' envelopes bore some cancelled and some uncancelled postage stamps. Inspector Dodson also found about 173,000 used postage stamps of various denominations, most packaged in glassine envelopes, one hundred stamps per envelope. The quantities and types of stamps which Wood had stored were of little collector value. On April 11, 1989, pursuant to federal charges filed against him by the United States Attorney in the Northern District of Florida, Wood pleaded guilty to the charge of dealing in cancelled postage stamps in violation of 18 U.S.C. Section 1720.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Criminal Justice Standards and Training Commission enter a Final Order and therein revoke the certification of William H. Wood. DONE and ENTERED this 30th day of July, 1990, in Tallahassee, Florida. DIANE K. KIESLING Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of July, 1990. Copies furnished to: Joseph S. White Assistant General Counsel Florida Department of Law Enforcement Post Office Box 1489 Tallahassee, Florida 32302 William H. Wood 104 North Claire Drive Panama City, Florida 32401 Jeffrey Long, Director Criminal Justice Standards and Training Commission Post Office Box 1489 Tallahassee, Florida 32302 James T. Moore, Commissioner Department of Law Enforcement Post Office Box 1489 Tallahassee, Florida 32302 Rodney Gaddy, General Counsel Department of Law Enforcement Post Office Box 1489 Tallahassee, Florida 32302
Findings Of Fact Petitioner Kenneth Blume, an unmarried man, purchased real property in his name on December 19, 1988. Petitioner Kenneth Blume obtained a mortgage on the property in his own name with PNC Mortgage Servicing Company. Petitioner Kenneth Blume married Petitioner Tina Blume on November 3, 1990. Thereafter, Petitioner Kenneth Blume contacted a title company, Advance Title, Inc. to refinance the property and transfer the property from himself, as sole owner, to himself and his wife, Petitioner Tina Blume. On June 19, 1992, as part of the refinancing transaction, Petitioner Kenneth Blume transferred his individual mortgage with PNC Mortgage Servicing Company to Foundation Financial Services, Inc. which paid off Petitioner Kenneth Blume's original mortgage. On June 19, 1992, Petitioner Kenneth Blume gave Petitioner Tina Blume a legal interest in the property by transferring half of the encumbered property to her by quit claim deed. Petitioner Kenneth Blume executed the deed in the presence of Cheryl Scott, a notary public and an employee of Advance Title, Inc. Said deed lists Petitioner Kenneth Blume as grantor and Petitioner Kenneth Blume and his wife, Petitioner Tina Blume, as grantees. On June 19, 1992, as part of the refinancing transaction, Petitioners created a new first mortgage on the subject property in favor of Foundation Financial Services, Inc. This mortgage is the obligation of both Petitioners. The quit claim deed was prepared by Advance Title, Inc. on Petitioners' behalf. The quit claim deed showed that the consideration paid for the transfer of the encumbered property was $10. On June 24, 1992, Advance Title, Inc. went to the Clerk of the Circuit Court's Office to record the quit claim deed. As a condition precedent to the recordation of any deed transferring an interest in real property, Section 201.022, Florida Statutes, requires that the grantor, grantee, or agent for the grantee, execute and file a return with the Clerk of the Circuit Court. The return is identified as a Form DR-219, Return for Transfer of Interest in Real Property. On June 24, 1992, Advance Title, Inc. filled out and signed the Form DR-219, Return for Transfer of Interest in Real Property, as the agent of Petitioners. Advance Title, Inc., as Petitioners' agent, did not disclose the full amount of consideration on Form DR-219 as required by question 3. Instead, Advance Title, Inc. wrote that the property was sold for $10. Advance Title, Inc. did not disclose the extinguished or refinanced mortgage on Form DR-219. In response to the question whether the sale was financed, Advanced Title, Inc. did not check the "yes" box on Form DR-219. Form DR-219 defines the word "consideration", in pertinent part, as follows: the purchase price of the property or the total amount paid or to be paid for the transfer of any interest in real property. Consideration includes: cash; new mortgages placed on the property to finance all or part of the purchase; existing mortgages on the property either assumed or taken subject to; mortgages that are cancelled, satisfied or rendered unenforceable, settled by the sale or transfer or in lieu or foreclosure . . . . This definition is consistent with the Legislature's definition of consideration set forth in Section 201.02(1), Florida Statutes (1991), applicable here. Advance Title, Inc., as Petitioners' agent, stated on Form DR-219 that documentary stamp tax in the amount of $.60 was due on the subject transfer of interest in real property. On June 24, 1992, Advance Title, Inc. presented the quit claim deed to the Clerk of the Circuit Court for recordation together with the Form DR-219. The Clerk recorded the quit claim deed and collected $.60 in documentary stamp tax based on information that Advance Title, Inc. provided on the Form DR-219. The Clerk did not tell Advance Title, Inc. or Petitioners that additional documentary stamp taxes were due on the transfer. Respondent conducted a routine audit of the Clerk's records and determined that additional documentary stamp taxes were due on the deed transferring an interest in the encumbered property to Petitioner Tina Blume. The record contains no competent substantial evidence to show that Petitioners fall within an exception to or exemption from paying the additional documentary stamp tax in question here. Moreover, there is no competent persuasive evidence that an agent of the state of Florida or Santa Rosa County misrepresented a material fact on which Petitioners relied to their detriment. Petitioners have not met their burden of proving by a preponderance of the evidence that they do not owe additional documentary stamp taxes on the real estate transaction at issue here.
Recommendation Based on the foregoing Findings of Facts and Conclusions of Law, it is recommended that Respondent enter a Final Order upholding its assessments as revised in a Notice of Reconsideration dated January 9, 1995, of documentary stamp tax, plus applicable interest and penalties against Petitioners Kenneth and Tina Blume. RECOMMENDED this 23rd day of October, 1995, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD, Hearing Officer 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 23rd day of October, 1995. APPENDIX The following constitutes the undersigned's specific rulings pursuant to Section 120.59(2), Florida Statutes, on all proposed findings of fact submitted by the parties to this case. Petitioners' Proposed Findings of Fact Petitioners' proposed recommended order for the most part is a memorandum of law and does not designate proposed findings of fact. However, the undersigned rules as follows on statements of fact contained within Petitioners' memorandum: Accept that Petitioner Kenneth Blume chose to sign the quit claim deed. No competent persuasive evidence regarding the Clerk of the Circuit Court's directions to Advance Title, Inc. or Petitioners. Uncorroborated hearsay evidence. Accept that Petitioners were not aware of Respondent's hotline service at the time of the conveyance; however, irrelevant. Reject that Petitioners made prudent and reasonable attempts to learn the requirements of Section 201.02, Florida Statutes. Petitioners had constructive notice of the published statutes and rules which were in effect at the time of the conveyance. Reject that the "system" deceived Petitioners. No competent persuasive evidence to support this fact. Reject that the "system" or "state" failed to disclose the law controlling taxes on real estate transactions. Applicable statutes and rules read together with the definition of consideration set forth on the Form DR-219 constitute sufficient notice to Petitioners. The "system" or "state" did not draft the language in the quit claim deed; therefore, the state was not required to include any language relating to the cost of the transaction. The Form DR-219 included a definition of consideration which is consistent with the language in the applicable statutes and rules. Reject that the state added new terms or changed the terms of the agreement memorialized in the quit claim deed. The state was not a party to the agreement between Petitioners. Reject that the system failed to inform Petitioners of "all" the terms in the contract as "offered" by the state. Respondent's assessment does not involve a contractual relationship between Respondent and Petitioners with the Respondent as a "seller" and Petitioner Kenneth Blume as a "buyer." Respondent's Proposed Findings of Fact The undersigned accepts the substance of Respondent's Proposed Findings of Fact 1-28 as modified in Findings of Fact 1-23 of this Recommended Order. COPIES FURNISHED: Nancy Francillon, Esquire Mark T. Aliff, Esquire Office of the Attorney General The Capitol - Tax Section Tallahassee, FL 32399-1050 Kenneth and Tina Blume 159 W. 29th Court Fayetteville, AR 72701 Linda Lettera, Esquire Department of Revenue 204 Carlton Building Tallahassee, FL 32399-0100 Larry Fuchs, Executive Director Department of Revenue 104 Carlton Building Tallahassee, FL 32399-0100
The Issue The issue here concerns the propriety of the Respondent, State of Florida, Department of Revenue's assessment of tax under authority of Sections 201.01 and .08, Florida Statutes, in the amount of $11,557.20 and penalty of $577.86 against the Petitioner, Landmark Bank of Brevard. The specific nature of the assessment is one pertaining to items identified as detachable "Promissory Notes" which are attached to documents entitled "Trust Receipts."
Findings Of Fact The facts in this case reveal that the Petitioner Landmark Bank of Brevard, hereafter referred to as the "Bank," made loans to several motor vehicle dealers in Brevard County. The borrowers were Carl Schmidt Motors, Inc.; Bennie C. Chapman, who does business as Chapman Auto Sales; and Harley Davidson of Melbourne, Inc. The arrangements for the loans were on the basis that the dealers would apply with the Bank to receive moneys which would be used to "floor plan" automobiles and motorcycles being sold through their retail outlets. The applications were processed through the loan committee and when the loans were approved a Promissory Note was signed by the appropriate persons acting in behalf of the dealers. (Copies of the notes executed were attached to the Petition for Formal Hearing and acknowledged to be correct through the answer filed in behalf of the Respondent and the notes as attached to the Petition are being provided with this Recommended Order together with those exhibits offered in behalf of the parties.) The notes allow for the single disbursement of a stated amount of money, with the repayment of principal and payment of interest being due by one payment for which demand is made within a period as short as several months or as long as one year depending on the note conditions. Collateral is provided, according to the terms of the notes, either by the lease and rental autos listed on separate documents entitled "Trust Receipts," which Trust Receipts are held by the Bank or otherwise described as such motor vehicles as were then owned by the dealers at the time the execution of the note or as would thereafter be acquired. These notes, meaning the initial Promissory Notes, had Documentary Stamps placed and canceled in the monthly journal of the Bank at the time of the execution of the Promissory Notes, in an effort by the Petitioner to comply with Section 201.08, Florida Statutes. The amount of Documentary Stamps utilized was in keeping with the face amount of the loan proceeds reflected on the Promissory Notes. Therefore, when the Promissory Notes are examined an impression is created that a single disbursement of loan proceeds has been made for which Documentary Stamp tax has been collected. In reality, the arrangement between the dealers and the Petitioner was to the effect that the full amount of the loan proceeds would not be assigned to the account of the dealers upon execution of the note. What would happen, is that the dealers would be allowed to make "draws" against the loan proceeds on the basis of surrendering the title of a used motor vehicle which they had acquired or having the manufacturer of a new motor vehicle submit the Manufacturer's Certificate of Origin to the Bank. In turn, moneys were advanced to the dealer equal to the value of the used unit or commensurate with the amount reflected on the Manufacturer's Certificate of Origin if a new unit. These titles and Manufacturer's Certificates of Origin were held as collateral and the dealers would take possession of the actual vehicles to be placed in the dealer's inventory until a retail purchase had been made. The vehicles for which the Petitioner had received title or the Manufacturer's Certificate of Origin were then listed on documents called "Trust Receipts." The "Trust Receipts" would show the vehicle description, make, serial number and price as described in the Manufacturer's Certificate of Origin or title. These descriptions were placed on individual "Trust Receipts" based upon the date the evidence of ownership was submitted from the dealer of the Bank. That is to say, if four Manufacturers' Certificates of Origin or titles were submitted to the Bank at one time, then four of the vehicles would be listed on a single "Trust Receipt" as opposed to listing the four new units on a "Trust Receipt" that already had a unit or units listed from another visit by the dealer. Examples of the various "Trust Receipt" documents may be found in the Respondent's Composite Exhibit 3 admitted into evidence which contains copies of the "Trust Receipt" examples. The "Trust Receipt" documents had attached to them an item entitled "Promissory Note," which item could be detached from the body of the "Trust Receipt." Some examples in the Respondent's Composite Exhibit 3 have the "Promissory Note" affixed, reflecting a date and money amount equal to the amount arrived at by totaling the value related to the various units shown in the "Trust Receipt." These examples also list the borrower's name and are signed by Margy Driggers, the Assistant Cashier of the Petitioner. Some are signed by Margy Driggers, with the initials "P.O.A." placed in front of or after her title as Assistant Cashier. One other example is the same as above but without the initials "P.O.A." There is also an example signed by Bennie C. Chapman, one of the dealers who borrowed money. The Chapman example reflects the amount of value shown in the "Trust Receipt," to which the "Promissory Note" is attached and it has a date, but does not reflect the amount of interest to be paid if this is indeed a Promissory Note. There was another category of "Trust Receipt" and attached "Promissory Note" reflecting motor vehicles for which money had been loaned and this was a type in which no entries had been made on the "Promissory Note"; however, an example of this type was not provided through the Respondent's Exhibit 3. Both parties acknowledged that the initials "P.O.A." stand for power of attorney. They disagree on the question whether a power of attorney had been granted to the Petitioner to act in behalf of the subject dealers. The Petitioner through its witnesses claim that the designation "P.O.A." is simply an extension of a long standing policy of the Bank which predates the current Assistant Cashier and has no meaning. Therefore, no power of attorney has ever been granted from the dealers to the Bank to execute promissory notes on behalf of the dealers. The Respondent through its auditor, whose investigation led to the assessment in dispute, claims that Margy Driggers, the Assistant Cashier, told him that "P.O.A." means power of attorney and that she had the ability to sign for Carl Schmidt. (Carl Schmidt Motors, Inc.) None of the dealers were presented in the course of the hearing to state their position on the granting of power of attorney to the Petitioner for purposes of executing the item known as "Promissory Note" attached to the various "Trust Receipts," and there are no written documents which would demonstrate the granting of a power of attorney to the Bank. Moreover, nothing in the original Promissory Notes executed by the dealers leads to the conclusion that the item known as "Promissory Note" attached to the "Trust Receipt" may be executed by a Bank official through power of attorney for the dealer. Consequently, no power of attorney has been shown to be granted from the dealers to Margy Driggers or any other employee of the Petitioner, on the subject of executing "Promissory Notes" attached to the "Trust Receipts." When the items were filled out, copies of the "Trust Receipts" and attached "Promissory Notes" were forwarded to the several dealers. When a dealer sold one of the automobiles for which the Petitioner held the title or Manufacturer's Certificate of Origin as security, then the dealer paid an amount equal to that amount reflected in the "Trust Receipt" document and an entry was made in the date paid column of that document which showed that amount of debt had been satisfied by the dealer. During the operative period of the initial Promissory Note, meaning that period between the time of the execution of the note and the time the note was due as reflected on the face of the note, the dealer could borrow an amount not to exceed the face amount of the loan proceeds and if some portion of that amount was retired, then an additional amount could be borrowed, which effectively meant that in the active life of the loan as shown by the initial Promissory Note more money could be borrowed during the life of the note than the amount reflected on the face of the Promissory Note. For example, hypothetically the Promissory Note could entitle the dealer to borrow $19,959.00 on May 10, 1976, to be repaid by May 10, 1977. That dealer could then borrow $19,959.00 between those dates and pay back that amount of money with interest and borrow an additional $5,000.00 to be paid back before the expiration date of the loan and in actuality would have borrowed $24,959.00, ostensibly under the terms and conditions of the initial note. These additional amounts of loan proceeds cannot be seen by examining the initial Promissory Notes; they can only be discovered by adding the individual amounts reflected in the "Trust Receipts" and comparing the total to what is shown by adding the loan amounts depicted in the initial Promissory Notes. This is in fact what was done by the auditor in conducting the audit and it is the differential between the amounts shown in the "Trust Receipt" aggregate as contrasted to the initial Promissory Note aggregate for which the Respondent claims Documentary Stamp tax is owed. The Respondent would have the Documentary Stamp tax applied to some combination of the so-called "Promissory Notes" attached to the "Trust Receipts" equal to an amount representing the differential spoken to before. The Respondent did not establish which "Trust Receipts" with attached "Promissory Notes" would be subject to the assessment of Documentary Stamp tax. Through this process, the Respondent in its Revised Notice of Assessment is claiming tax of $11,557.20 and a penalty of $557.86. (A copy of this notice may be found as Respondent's Exhibit 4 admitted into evidence.)
Recommendation It is RECOMMENDED that the proposed assessment for Documentary Stamp tax and penalty made by the Department of Revenue, State of Florida, against the Petitioner, Landmark Bank of Brevard, a banking corporation organized and existing under the laws of the State of Florida, formerly Landmark Bank of Melbourne, N.A., be DISALLOWED. 1/ DONE AND ENTERED this 9th day of April 1980 in Tallahassee, Florida. CHARLES C. ADAMS Hearing Officer Division of Administrative Hearings 101 Collins Building Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of April 1980.
Recommendation Based on the foregoing findings of fact and conclusions of law the Hearing Officer recommends that the office of the Comptroller and the Department of Revenue honor the claims for refund of the documentary stamp taxes in the amount of $1,027.50 and the surtax stamp taxes in the amount of $376.75, refunding these amounts to the Petitioner. DONE AND ORDERED this 12th day of September, 1978 in Tallahassee, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Maxie Broome Assist Attorney General Department of Legal Affairs The Capitol Tallahassee, Florida 32304 G. Kristin Delano, Esquire Post Office Box 180 St. Petersburg, Florida 33731
