The Issue At issue is whether Petitioner is entitled to an award of attorney's fees and costs pursuant to Section 57.111, Florida Statutes, the "Florida Equal Access to Justice Act."
Findings Of Fact Findings relating to the underlying disciplinary action The Department of Health, Division of Medical Quality Assurance, Board of Dentistry (Department), is a state agency charged with the duty and responsibility for regulating the practice of dentistry pursuant to Section 20.43 and Chapters 455 and 466, Florida Statutes. At all times material hereto, Petitioner, Mounir Albert, D.D.S. (Dr. Albert), was licensed to practice dentistry in the State of Florida, having been issued license number DN 0010217. On September 2, 1997, the Department issued an Administrative Complaint against Dr. Albert (Agency Case Number 95-12645). The complaint charged that Dr. Albert was subject to disciplinary action under the provision of Subsection 466.028(1)(aa), Florida Statutes (1995), for having violated Subsection 455.241(1), Florida Statutes, by having failed, upon request, to furnish a patient in a timely manner, without delays for legal review, copies of all reports and records relating to the patient's examination or treatment, including x-rays and insurance information. For such violation, the Department proposed that one or more of the following penalties be imposed: . . . revocation or suspension of . . . [Dr. Albert's] license, restriction of . . . [Dr. Albert's] practice, imposition of an administrative fine, issuance of a reprimand, placement of . . . [Dr. Albert] on probation, and/or any other relief that the Board deems appropriate. Dr. Albert disputed the allegations of fact contained in the Administrative Complaint, and the matter was referred to the Division of Administrative Hearings (DOAH) for the assignment of an administrative law judge to conduct a formal hearing. The matter was assigned DOAH Case No. 97-5001, and a hearing was duly held on February 5, 1998. On March 9, 1998, a Recommended Order was rendered, which concluded that, while Dr. Albert failed to furnish the patient records on request, the Administrative Complaint should be dismissed. Central to such conclusion was the finding that: . . . while subsection 455.241(1) obligates the health care provider to provide, upon request, copies of a patient's medical records, subsection 455.241(4) also authorizes the health care provider to charge, for such service, the cost of duplication. Reading the provisions in pari materi, it is reasonable to conclude that, absent payment of the cost of duplication, a health care provider is under no obligation to provide a patient with copies of his records. Since the patient failed to pay Dr. Albert for the cost of duplication, as requested, it was resolved that Dr. Albert had not violated Subsection 455.241(1) as alleged in the Administrative Complaint. On June 9, 1998, the Board of Dentistry entered a Final Order in the underlying case. The Final Order approved and adopted the Findings of Fact and Conclusions of Law set forth in the Recommended Order, and dismissed the Administrative Complaint. Judicial review of the Final Order was not sought, and Petitioner timely filed the subject petition for attorney's fees and costs pursuant to Section 57.111, Florida Statutes. Findings relating to the claim for attorney's fees and costs Pertinent to Dr. Albert's claim for attorney's fees and costs, the Department has conceded that the underlying action was initiated by the Department, that Dr. Albert prevailed in the underlying case, and that the claim for attorney's fees and costs was timely filed.1 The Department has, however, denied that Dr. Albert was a "small business party" and, therefore, a "prevailing small business party," as those terms are defined by Section 57.111, Florida Statutes, and has affirmatively averred that its actions were "substantially justified." Given the circumstances, an award of reasonable attorney's fees and costs would be appropriate provided Dr. Albert can establish, by a preponderance of the evidence, that he was a "prevailing small business party" in the underlying proceeding and, if so, the Department fails to establish that its actions were "substantially justified." Addressing first Dr. Albert's status, it must be concluded that the proof fails to support the conclusion that at the time the underlying proceeding was initiated, or at any other time material hereto, Dr. Albert (the party to the underlying proceeding) was a "small business party," as that term is defined by Section 57.111(3)(d), Florida Statutes, and, consequently, the proof fails to support the conclusion that he was a "prevailing small business party," as required for compensation under the Florida Equal Access to Justice Act. See Section 57.111(4)(a), Florida Statutes. In so concluding, it is observed that the proof demonstrates that, at all times material, Dr. Albert practiced dentistry as an employee of a professional service corporation, Mounir Albert, D.D.S., P.A. (the corporation or business), as authorized by Chapter 621, Florida Statutes, and was not shown to be the sole proprietor of, or operate his dental practice or any other enterprise, as an unincorporated business. Having resolved that Dr. Albert was not shown to be a "prevailing small business party," and was, therefore, not eligible for an award of attorney's fees and costs under the Florida Equal Access to Justice Act, it is not necessary to address whether the Department's actions were "substantially justified," when the underlying proceeding was initiated.
The Issue The issues in this case concern the attempt by Petitioner to collect $11,684.62 in attorneys fees and costs associated with the defense of the case of State of Florida, Department of Business Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes, Petitioner, vs. Donald L. Hilgeman and Marilyn Hilgeman, d/b/a DLH Enterprises; and Pat Montgomery, as park owners of Lake Waldena Resort, Respondents, DOAH Case No. 89-4100, and $931.50 in attorneys fees and costs attributable to the pursuit of the present case to collect those attorneys fees and costs attributable to the defense of the administrative prosecution. See Section 57.111, Florida Statutes.
Findings Of Fact At all times relevant to this inquiry Petitioner was a mobile home park owner as defined by Section 723.003(7), Florida Statutes (1987). Petitioner, Marilyn Hilgeman, his former wife, and Pat Montgomery had administrative charges brought against them through a notice to show cause. In that notice to show cause those three individuals were identified as park owners of Lake Waldena Resort in Silver Springs, Florida. In particular the present Respondent charged the Petitioner and the others with violating Section 723.037(3), Florida Statutes (1987) for having refused to meet with a designated mobile home owners committee within 30 days of giving notice of a lot rent increase and having been requested to conduct that meeting for purpose of discussing the reasons for the increase in the lot rental amount. The accused sought a formal hearing as envisioned by Section 120.57(1), Florida Statutes. That hearing was conducted by the undersigned and a recommended order entered on April 18, 1990, in the aforementioned DOAH Case No. 89-4100. For reasons set out in the conclusions of law found within the recommended order, the suggested disposition of that case was one which found the several Petitioners innocent of any wrong doing and called for the dismissal of the administrative prosecution. On July 25, 1990 the prosecuting agency entered its final order in DOAH Case No. 89-4100. It accepted the fact-finding in the recommended order; however, it modified the conclusions of law and recommended disposition. Unlike the recommended order, the final order in its conclusions of law specifically found that the present Petitioner and the others accused had violated Section 723.037(3), Florida Statutes, wherein at page 17 it was held "Therefore, it is concluded Respondent violated Sections 723.037(3), Florida Statutes." The conclusions of law in the final order went on to say that in mitigation of the violation the prosecuting agency had considered the apparent confusion of those Respondents regarding the affect of Rule 7D-32.004(2), Florida Administrative Code, as it might influence the actions of the accused and in particular, the present Petitioner. In the final order concerning the mitigating affects of Rule 7D-32.004(2), Florida Administrative Code, it was decided that notwithstanding any misunderstanding the accused had as to the significance of the Rule it could not alter the statutory requirements of having a meeting within 30 days of the notice of lot rental increase as described in Section 723.037(3), Florida Administrative Code (1987). The language within Rule 7D-32.004(2), Florida Administrative Code, stated: If requested to do so by the park owner or subdivision developer, the committee shall certify that it has been selected as described in Rule 7D-32.003, Florida Admin- istrative Code. This certification shall include a certificate of all members of the committee attesting to its proper formation under the statute and these rules. For reasons expressed in the recommended order that rule was seen as tolling the 30-day requirement for meeting expressed in Section 723.037(3), Florida Statutes (1987) on the facts found in both the recommended and final orders. This was based upon a recognition that the present Petitioner had employed the rule in an attempt to gain a certification from the committee of mobile home owners prior to the conduct of a meeting to discuss the increase in lot rentals. Again, this belief that the rule tolled the requirement for conducting the meeting within 30 days of the notice of lot rental increase expressed in the recommended order was rejected in the final order. The final order controls absent further relief by resort to the appellate court process. In describing the reasons why the prosecution maintained that the rule could not alter the statutory requirement for holding a meeting within 30 days, the final order states that there are policy considerations that make it important for the committee and the park owner to meet within 30 days and those reasons concern the fact that the rent increase becomes effective within 90 days over the notice, the informational value of having the reasons explained for the lot increase as a prelude to any request to having a dispute about lot rental increases submitted to mediation within 30 days following the scheduled meeting. The final order goes on to describe, through its conclusions of law, that the meeting to discuss lot rental increase was not held until November 14, 1989 over a year after the notice of lot rental increase. That statement comes immediately before the conclusion of law that the present Petitioner had violated Section 723.037(3), Florida Statutes. In the conclusions of law set out in the final order the prosecuting agency in its paragraph describing the mitigating circumstances acknowledges the possible confusion on the part of the accused as well as the mobile home owners committee when it describes, as did the recommended order, the filing of a complaint by the committee as a means of ostensibly preserving the right to have the meeting envisioned by Section 723.037(3), Florida Statutes (1987), when taken against the background of the opportunity to have a credential check of mobile home owners committee members as envisioned by Rule 7D-32.004(2), Florida Administrative Code. This refers to the issue of whether a meeting could be held after 30 days from the notice of intended lot rental increase absent such a complaint. In the statement on mitigation the final order recognizes that the administrative prosecution was penal in nature and that Section 723.037(3), Florida Statutes (1987) and Rule 7D-32.004(2), Florida Administrative Code needed to be read in context and should be strictly construed with ambiguities favoring the accused. The final order cites to State v. Pattishall, 99 Fla. 296, 126 So. 147 (1930) and Davis v. Dept. of Professional Regulation, 457 So.2d 1074 (Fla. 1DCA 1984). The treatment of those cases and the resolution of the dispute through final order is one which finds the accused in violation of Section 723.037(3), Florida Statutes (1987), but mitigates the disposition in the way of the penalty based upon the reading given Pattishall and Davis, supra. That factual impression is given when the order in disposition is examined wherein it is stated through the final order, "Based upon the consideration of the facts found, the conclusions of law reached, and the mitigation evidence, it is ordered that the notice to show cause is hereby dismissed." On August 22, 1990, the present Petitioner noticed an appeal of the final order in the administrative prosecution but later abandoned that appeal before the court had the opportunity to speak to its merits. On October 22, 1990, the present Petitioner filed a petition for collection of attorneys fees and costs spoken to in the statement of issues. The petition for attorneys fees and costs were subjected to a motion to dismiss based upon a claim of untimeliness and that motion was denied by order of December 10, 1990. The present Respondent requested an evidentiary hearing as contemplated Section 57.111, Florida Statutes, and Rule 22I-6.035, Florida Administrative Code, and the evidentiary hearing was conducted on the date described before. When the present Petitioner abandoned his appeal to the District Court, he necessarily was placed in the position of arguing that the final order drawn by the prosecuting agency constituted the basis for the claim that he was a small business party who had prevailed in the dispute related to DOAH Case No. 89-4100. See Section 57.111(3)(c)1, Florida Statutes. Contrary to his assertion the final order as described in these facts did not favor the present Petitioner. Although the prosecuting agency did not choose to impose a penalty against the present Petitioner based upon its assessment of matters in mitigation and dismissed the case without exacting a penalty, it had found the present Petitioner in violation of a substantiative provision of law, i.e. Section 723.037(3), Florida Statutes (1987). Thus, the disposition cannot be said to favor the present Petitioner. Having decided this mixed question of fact and law against the present Petitioner, it is not necessary to make findings of fact concerning whether the present Petitioner is a small business party as defined at Section 57.111(3)(d), Florida Statutes and whether the present Respondent was substantially justified in this administrative prosecution related to law and fact as contemplated by Sections 57.111(3)(e) and (4)(a), Florida Statutes, or to examine whether special circumstances exist that would make the award of attorneys fees and costs unjust.
Findings Of Fact For the purposes of the motion, the parties stipulated to the following facts: The Department's action giving rise to Petitioners' petition for attorney's fees under Section 57.111, Florida Statutes, was to propose confirm a report of abuse/neglect against each of the five Petitioners in their individual capacity. Each Petitioner requested a formal hearing under Section 120.57(1), Florida Statutes, which resulted in five separate cases, none of which named Palmetto Guest Home, Inc. as a party. The five cases were consolidated but were subsequently dismissed as a result of the Department downgrading each case to "closed without classification". All five of the Petitioners worked at the Palmetto Guest Home, Inc. and are related to each other. The Palmetto Guest Home, Inc., is a Florida corporation in good standing and registered with the State of Florida as an adult congregate living facility. James E. Biggins is the president and a director of Palmetto Guest Home, Inc., and is the corporation's sole shareholder. Palmetto Guest Home, Inc., was not named as a party in the underlying administrative action and is not one of the Petitioners in this case. James E. Biggins was not named as an alleged perpetrator in the underlying administrative action and is not one of the Petitioners in this case. James E. Biggins is the father of Petitioners, K.B., J.J.B. and M.B., who are vice presidents of the corporation. James E. Biggins is the husband of Petitioner S.B., who is a director and the secretary/treasurer of the corporation. James E. Biggins is the father-in-law of Petitioner T.B., who is the administrator of Palmetto Guest Home, Inc. Palmetto Guest Home, Inc. has net a worth of less than two million dollars.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Background Petitioner, John's Island Club, Inc. (petitioner or the club), is a not-for-profit corporation which owns and operates a private country club facility in the John's Island residential development in Indian River County, Florida. It provides a variety of recreational facilities to its members. Among the amenities are three golf courses, nineteen tennis courts, a tennis building, a beach club, a club house, a swimming pool, and dining facilities. Respondent, Department of Revenue (DOR), is a statutorily created agency charged with the administration of the state revenue laws, including Chapter 212, Florida Statutes, and rules promulgated thereunder. As a result of an amendment made in 1991 to Subsection 212.02(1), Florida Statutes, DOR is authorized by law to impose an admissions tax on "dues and fees" paid to private membership clubs providing recreational facilities. As a private membership club, petitioner is subject to this tax. Beginning on July 1, 1994, petitioner made an assessment on each member to raise capital for the purpose of repairing and replacing many of its physical facilities. During the six month period ending December 31, 1994, $10,441,897 was collected from the members and made available to the club. Rule 12A- 1.005(d)1.b., Florida Administrative Code, which was adopted by DOR in December 1991 to implement the admissions tax on dues and fees, imposes a tax on "(a)ny periodic assessment (additional paid-in capital) required to be paid by members of an equity or non-equity club for capital improvements." Under the authority of that rule, DOR required that petitioner pay the applicable sales tax on the assessment collected through December 31, 1994, or $730,932.79, and that it continue to pay the tax as other similar assessments are made in the future. Claiming that the rule exceeds DOR's grant of rulemaking authority, and it modifies, enlarges, and contravenes the law implemented, petitioner filed a petition for administrative determination of invalidity of existing rule. DOR denies all allegations and asks that the validity of its rule be upheld. The Club and the Assessment The composition of the club The club began operation in 1969 but was purchased by its members in 1986. It is an equity private membership club but issues no stock. The club has two types of memberships: golf and sports social. Currently, the cost of a golf equity membership is $85,000 while the cost of a sports social membership is $30,000. After payment of these fees, the member receives a membership certificate, which represents his or her equity ownership interest in the club. At the present time, there are 1125 golf memberships and 257 sports social memberships. Of the 1125 golf memberships, the original developer still owns 67. In addition to having to purchase a membership, members must also pay annual dues. A golf member pays $4,875 in annual dues while a sports social member pays $2,760 in annual dues. A sales tax is also collected on these dues. The dues are used to cover operating expenses such as insurance, administrative costs, staff salaries, and maintenance costs. In addition, members pay fees for additional services such as golf cart use, golf bag storage, locker room use, and golf and tennis lessons. When a member decides to resign or retire from the club, he or she may resell the membership to the club (but not a third party) and receive the greater of (a) the initial amount paid by the retiring member, or (b) 80 percent of the current membership cost (with the remaining 20 percent retained by the club in a separate capital improvement account). The assessment In 1992, the club began studying the feasibility of repairing and replacing many of its physical facilities. The total cost of the proposed work was set at $16,372,000. By majority vote taken in the spring of 1994, the members decided to raise capital for the work by imposing a capital assessment on each current member. It was agreed that the capital contribution would be $12,000 from each golf member and $11,150 from each sports social member. However, the payment of the capital contribution was not intended to, and did not result in any, decrease in the dues which members were required to pay for the use of the club's facilities. A failure to pay the assessment would result in suspension from the club. Three different options were made available to the members for the manner of payment of the capital contribution. The options included (a) a single payment, (b) payment over a three-year period, or (c) payment of interest only until such time as the member either sold the membership or left the club. After making payment in full, the member would be issued a certificate of capital contribution. It is noted that the developer was required to pay the capital contribution for his 67 golf memberships. Further, any person joining the club after the imposition of the assessment would likewise be required to pay the assessment. Beginning in July 1994, the club began collecting the capital contribution from its members. From July through December 1994, some $10,441,897 was collected. A total sales tax of $730,932.79 has been paid on those collections. Shortly thereafter, petitioner opted to file this rule challenge. The Rule and its Origin Rule 12A-1.005(5)(d)1.b. provides as follows: (d)1. Effective July 1, 1991, the following fees paid to private clubs or membership clubs as a condition precedent to, in conjunction with, or for the use of the club's recreational or physical fitness facilities are subject to tax. * * * b. Any periodic assessments (additional paid in capital) required to be paid by members of an equity or non equity club for capital improvements or other operating costs, unless the periodic assessment meets the criteria of a refundable deposit as provided in sub-subparagraph 2.e. below. * * * Under the terms of the rule, the capital contri- bution assessed by the club does not qualify as a refundable deposit. This is because any difference between the amount collected by the club upon the sale of a membership to a new member, and the amount which was paid to the retiring member, is retained by the club. Because Rule 12A-1.005, Florida Administrative Code, covers a wide array of items subject to taxation, the DOR cites Sections 212.17(6), 212.18(2), and 213.06(1), Florida Statutes, as the specific authority for adopting the rule, and Sections 212.02(1), 212.031, 212.04, 212.08(6) and (7), 240.533(4)(c), and 616.260, Florida Statutes, as the law implemented. There is no dispute between the parties, however, that in adopting sub-subparagraph 1.b., which contains the challenged language, the agency was relying principally on Subsection 212.02(1), Florida Statutes, as the law being implemented. That subsection defines the term "admissions" for sales tax purposes. Although the parties did not specifically say so, DOR relies on Section 212.17(6), Florida Statutes, as its source of authority for adopting the rule. That subsection authorizes DOR to "make, prescribe and publish reasonable rules and regulations not inconsistent with this chapter . . . for the enforcement of the provisions of this chapter and the collection of revenue hereunder." For the purpose of assisting DOR in administering the Florida Revenue Act of 1949, which imposes a sales and use tax on various transactions, Section 212.02, Florida Statutes, provides definitions of various terms used in the chapter, including the term "admissions." Prior to the 1991 legislative session, subsection 212.02(1) read in pertinent part as follows: The term "admissions" means and includes . . . all dues . . . paid to private clubs and membership clubs providing recreational or physical fitness facilities, including, but not limited to, golf, tennis, swimming, yachting, boating, athletic, exercise, and fitness facilities. During the 1991 legislative session, the definition of the term "admissions" was expanded by the addition of the following underscored language: The term "admissions" means and includes . . . all dues and fees . . . paid to private clubs and membership clubs providing recreational or physical fitness facilities, including, but not limited to, golf, tennis, swimming, yachting, boating, athletic, excercise, and fitness facilities. Thus, the legislature added the term "fees" to the term "dues" for those amounts "paid to any private clubs and membership clubs" which would be subject to the admissions tax. Prior to the above change in substantive law, rule 12A-1.005(5), as it then existed, provided that dues paid to athletic clubs which provided recreational facilities were taxable. However, subparagraph (5)(c) of the rule also provided that (c) Capital contributions or assessments to an organization by its members are not taxable as charges for admissions when they are in the nature of payments made by the member of his or her share of capital costs, not charges for admission to use the organization's recreational or physical fitness facilities or equipment, and when they are clearly shown as capital contributions on the organization's records. Contributions and assessments will be considered taxable when their payment results in a decrease in periodic dues or user fees required of the payor to use the organization's recreational or physical fitness facilities or equipment. Therefore, capital contributions were not taxable unless they resulted in decreased dues. That is to say, if a club levied an assessment on members and concurrently lowered its monthly dues, the assessment would be deemed to be taxable and in contravention of the rule. Thus, the effect of the rule was to prevent a club from renaming "dues" as "capital contributions" or "assessments" in order to avoid paying a tax on the dues. After the change in substantive law, the DOR staff began preparing numerous drafts of an amendment to its rule to comply with the new statutory language. At one stage of the drafting process, a DOR staffer recommended that, because the legislature had not provided a definition of the term "fee," the DOR should adopt a rule which provided that capital contributions be "not taxable if assessed under an equitable membership." Relying on what it says is the legislative intent, the DOR eventually proposed, and later adopted, the rule in its present form. In doing so, the DOR relied upon the terms "capitalization fees" and "capital facility fees" which are found in certain legislative history documents pertaining to the new legislation. Legislative History of the Law Implemented Although a number of bills related to the subject of a sales tax on admissions, the bill enacted into law was identified as Committee Substitute for House Bill 2523 (CS/HB 2523). The legislative history of the various bills relating to this subject has been received in evidence and considered by the undersigned. In early 1991, the House and Senate considered bills which addressed amendments to the sales tax on admissions. The first time the issue was addressed was at a meeting on February 21, 1991, of the Subcommittee on Sales Tax of the House Committee on Finance and Taxation. The discussion at the meeting indicated that the intent of the bill was to close a loophole that allowed physical fitness facilities to change their pricing structure to charge a higher initiation fee, which was not taxable, and thereby reduce their monthly dues, which were taxable, so as to reduce the revenue below that originally anticipated by this tax on admissions. This is corroborated by the bill analysis of the proposed committee bill that was offered, PCB FT 91-3A, which summarized the problem and solution as follows: Section 212.02(1), F. S. was amended during the 1990 Legislative Session to include in the definition of admissions those "dues" of "membership clubs" providing "physical fitness" facilities. Some clubs have attempted to avoid the tax (on dues) by shifting a substantial portion of the members' payments from "dues" to "initiation fees." Section 212.02(1), F. S., is amended to include "fees" as well as "dues" in the definition of admissions. All fees, including initiation fees and capitalization fees, paid to private clubs and membership clubs providing recreational or physical fitness facilities would be subject to the sales tax on admissions. It is unclear, but likely, that PCB FT 91-3A became House Bill 2417 (HB 2417). The bill analysis and economic impact statement on HB 2417, which was prepared by the House Committee on Appropriations, contained identical language to that in the bill analysis on PCB FT 91-3A. At the same time, the Senate was considering Senate Bill 1128, which later became Committee Substitute for Senate Bill 1128 (CS/SB 1128). On March 14, 1991, a staff analysis and economic impact statement on CS/SB 1128 was prepared by the Senate Committee on Finance, Taxation and Claims. It provided that: Section 212.02(1), Florida Statutes, defines "admissions" for sales and use tax purposes. Monthly fees of clubs with major facilities such as tennis courts, a swimming pool or a golf course have always been subject to the sales tax. During the 1990 Legislative Session this statute was amended to include dues on membership clubs providing physical fitness facilities, and not having these other major facilities. According to the DOR, such clubs have attempted to avoid payment of this tax by shifting a substantial portion of the members payments from dues to initiation fees which are not taxed. Accordingly, the purpose of the proposed statutory amendment was "to include initiation fees as well as dues in the definition of admissions." HB 2417 was passed by the House on April 17, 1991, and was sent to the Senate, where it was referred to the Committee on Finance, Taxation and Claims. HB 2417 died in that Committee. CS/SB 1128 was passed by the Senate on April 4, 1991, and was sent to the House, where it died in messages. A separate bill, Committee Substitute for House Bill 2523, which addressed similar issues to those addressed in HB 2417 and CS/SB 1128, was passed by the House on April 4, 1991, and was sent to the Senate where it was passed with amendments. The Bill was then returned to the House where further amendments were adopted. The Bill was again sent to the Senate with a request for the Senate to concur with the House amendments. The Senate refused to concur and the Bill was sent to a conference committee. The conference committee on finance and taxation met on April 19, 1991. The entirety of the discussion of the committee on this issue is as follows: Senator Jenne: The - - going down to number 21, admissions, initiation fees. The House includes capitalization fees. Representative Abrams: Which is this? Mr. Weiss: The Senate bill just states initiation fees are additionally included. The House bill, I believe, says that it's just all fees, which would include whether they called them initiation fees or capital facility fees or whatever. Representative Abrams: Because we are using something other than initiation - - Mr. Weiss: It's a fee that is going to be included. Representative Abrams: Yes, they were using - - they were breaking down categories of fees to avoid the tax, I think is what the deal was there. That gets us how much? Senator Jenne: Okay, well, it doesn't matter, because you can do it. Representative Abrams: Okay, good. Although the terms "capital facility fees" and "capitalization fees" were used during the discussion, contrary to DOR's assertion, it is far from clear that the intent of the amendment was to make taxable all capital contributions and assessments paid by members of private clubs providing recreational facilities. When placed in context with the prior debate before the committees and their staff analyses, it is much more likely that the intent was to close a loophole then used by physical fitness clubs who were renaming dues as fees in order to avoid taxes. The report of the conference committee was received by both houses on April 30, and CS/HB 2523 was passed by both houses the same day. The conference committee report for the bill contains only the following language describing the sales tax on admissions/initiation fees: Includes all recreational or physical fitness facility fees in the definition as admissions. The official conference committee report contains no reference to the terms "capitalization fees" or "capital facility fees." Neither does it make reference to the terms "assessment" or "paid in capital," which are the terms used by DOR in its rule. In the final bill analysis and economic impact statement prepared by the House Committee on Finance and Taxation for CS/HB 2523 on June 12, 1991, or 43 days after the bill was passed, the analysis states that subsection 212.02(1) was amended to include: "fees" as well as "dues" in the definition of admissions. All fees, including initiation fees and capitalization fees, paid to private clubs and membership clubs providing recreational or physical fitness facilities would be subject to the sales tax on admissions . . . This amendment should also limit further attempts to avoid taxation by renaming the fees collected from members. The staff analysis was obviously not available to members of the House or Senate when they voted on the bill on April 30, 1991. Although the final bill analysis used the term "capitalization fees," no where in any of the legislative history is there evidence of any legislative consideration of what was actually meant by that term. This is also true of the term "capital facility fees" which surfaced on one occasion prior to the passage of the bill. Capitalization Fees and Their Significance The sole basis for the DOR including the tax on assessments for capital improvements was the appearance in the legislative history of the terms "capitalization fees" and "capital facility fees." Neither term has any meaning to tax accountants. However, the accounting witnesses for both parties agreed that, from an accounting perspective, the phrase "capital facilities" would be understood to be assets having a life longer than one year. A capital contribution is typically a one time payment for the purchase of assets. It does not entitle the member to use the club. It is an equity transaction, not an income transaction, and it represents an intent to make an investment to improve the value of the membership assets separate and apart from the payment of annual expenses for the receipt of some service. "Dues" are a member's contribution to the operating costs of a club. They are assessed over an annual period and they are recurring. They also represent the payment that a member pays for admission to the organization. A capital contribution paid by a member of an equity membership club is not "dues." "Fees" as applied to a club are user charges. They are voluntary so that a member can decide whether or not to incur the charge based on whether the member uses the particular service to which it relates. A capital contribution is not a "fee."
Findings Of Fact On December 22, 1987, the undersigned held a formal hearing in the underlying case, (DOAH Case No. 87-3084), and on February 4, 1988, issued a Recommended Order to the Florida Real Estate Commission in which it was concluded that the Petitioners had violated various provisions of the Florida Statutes and that disciplinary action was appropriate. Specific disciplinary action was recommended as to each Petitioner. In its Final Order, predicated upon the above mentioned Recommended Order, the Commission adopted the undersigned's Findings of Fact and Conclusions of Law but found the recommendation for punishment as to both Petitioners was inadequate. The Commission increased each period of suspension, rejected the recommendation for stay and automatic remission as to the suspensions, and imposed an administrative fine on each Petitioner. Thereafter, Petitioners appealed the Final Order to the Second District Court of Appeal which, in an opinion filed February 17, 1989 affirmed the Commission's findings of guilt but reversed the penalties imposed by the Commission and remanded with instructions to approve the Hearing Officer's recommended penalties. It is on the basis of this appellate action that Petitioners, claiming to be prevailing small business parties, initiated the instant action. Petitioners are requesting attorney's fees in the amount of $5,261.28 for the appellate action which resulted in the District Court of Appeals reducing the penalty imposed by the Commission to that recommended by the Hearing Officer. This fee and cost figure is the cumulative of charges incurred and represented on 11 monthly billing statements starting 06-01-88 and extending through 04-01-89. Only the last eight, starting with the 09-01-88 billing, state the hours spent providing service. The Florida Legislature has defined a "prevailing small business party" at Section 57.111(3)(c), Florida Statutes.
The Issue Whether the Petitioner, Patricia Smithwick Valz, is entitled to an award of attorney's fees as a "prevailing small business party" in the underlying administrative proceeding.
Findings Of Fact Based upon the testimony of the witnesses, the documentary evidence received at the hearing, and the record in DOAH case no. 88-6257, the following findings of fact are made: On October 24, 1988, the Department notified Sophie DeRuiter and Ann & Jan Retirement Villa that the license to operate an adult congregate living facility expired on October 23, 1988, and that the application for renewal was denied. The specific reasons listed as the grounds for such denial were a determination of confirmed medical neglect of residents and the inappropriate retention of residents. Thereafter, Petitioner timely sought an administrative review of the denial by filing a petition for administrative hearing with the Department which was subsequently forwarded to the Division of Administrative Hearings for formal proceedings on December 16, 1988. That matter was assigned DOAH case no. 88- 6257. Hearing of case no. 88-6257 was originally scheduled for March 17, 1989, by notice of hearing dated January 18, 1989. Thereafter, Petitioner scheduled a number of depositions and requested a continuance in the case to accommodate Sophie DeRuiter. That motion was unopposed by the Department and was granted by order entered February 27, 1989. That order also rescheduled the hearing for April 14, 1989, and required the parties to file a prehearing statement no later than March 24, 1989. Neither party timely filed a prehearing statement. In fact, the parties were unable to agree on a statement due to their disagreement as to the issues of the case. The unilateral statements filed by the parties established that Petitioner sought review of all grounds for the denial of the license renewal. On the other hand, the Department took the position that since Sophie DeRuiter was listed on the Florida Abuse Registry for confirmed medical neglect of residents, that such listing precluded renewal of the license. The Department alleged that Petitioner had not timely challenged the abuse report, and that such record could not be challenged in the instant case. The Department's letter denying amendment or expungement of the medical neglect had been issued December 7, 1988. Given the confusion of the parties and their failure to file prehearing statements as required, the hearing scheduled for April 14, 1989, was cancelled. Subsequently, the Department moved to limit the issue to whether there was a confirmed record of an abuse report (and thereby presume the underlying report correct). Such motion was denied on June 1, 1989. On June 9, 1989, the hearing of this matter was convened. At that time, the Department moved to continue the case due to illness of counsel and her inability to review an amended witness list filed by Petitioner. The motion was granted after it was apparent counsel for the Department was unprepared to go forward on all issues of the case (she represented she had just received the order requiring her to go forward on all issues on June 8, 1989). The case was rescheduled for August 10, 1989. Subsequently, the matter was continued again at Petitioner's request. The case was finally scheduled for hearing for September 8, 1989. The Petitioner filed a motion for summary judgment on August 14, 1989. On September 7, 1989, the Department filed a notice of dismissal which was construed as an assent, in whole or in part, to the relief requested by the Petitioner. Consequently, the hearing was cancelled and jurisdiction was relinquished to the Department for such further action as would be appropriate. It was presumed that the abuse record would be expunged which would result in the reinstatement of the license. The Petitioner in the instant case has not, however, established the final resolution of DOAH case no. 88-6257. Petitioner did not comply with Rule 22I-6.035, Florida Administrative Code by attaching the documents on which the claim that the small business party prevailed was predicated nor was proof of such document offered at the hearing of this matter. Sophie DeRuiter is the administrator and owner of Ann & Jan Retirement Villa which is located at 3486 Rostan Lane, Lake Worth, Florida. According to the style of the initial pleading filed by Petitioner in the instant case, Ann & Jan Retirement Villa has been incorporated. The proof offered at hearing suggested that Sophie DeRuiter is the sole proprietor of a business known as "Ann & Jan Retirement Villa." In August, 1988, Ms. DeRuiter employed approximately four full-time employees. In the three years she has owned and operated the facility, Ms. DeRuiter has never employed more than twenty-five full-time employees. The net worth of Ann & Jan Retirement Villa is less than two million dollars. Ms. DeRuiter's personal net worth is less than two million dollars. The combined worth of Ann & Jan Retirement Villa and Ms. DeRuiter is less than two million dollars. Ms. DeRuiter employed the law firm of Weissman and Chernay, P.A. to represent her in connection with the allegations in DOAH case no. 88-6257. In connection with that case, Ms. DeRuiter incurred legal fees in the amount of $8587.50 together with costs in the amount of $897.59. The reasonableness of those amounts was not disputed.
The Issue The issue to be resolved in this proceeding is whether Petitioner should be awarded attorney's fees and costs pursuant to section 57.111, Florida Statutes(2011).1/
Findings Of Fact On August 11, 2010, Judith Amadiz ("Amadiz") filed a complaint of housing discrimination with the United States Department of Housing and Urban Development ("HUD") alleging disability discrimination. The Commission conducted an investigation of the complaint. During the investigation, the investigator obtained statements and documents from both parties. The investigator's final investigative report ("Determination") (Petitioner's Composite Exhibit numbered 2) detailed numerous materials submitted by the parties for review during the investigation. Some of the materials referenced included a Medical Certification Form submitted on September 3, 2010, from Carlos Sesin, M.D.; a copy of Complainant's Lease Application dated December 8, 2009; and six letters including a copy of correspondence from Complainant dated April 27, 2010, requesting steam cleaning, and a copy of correspondence from Complainant dated May 17, 2010, requesting steam cleaning. The Determination dated October 20, 2010, concluded that there was reasonable cause to believe that a discriminatory housing practice occurred. The Commission forwarded the Determination to a staff attorney to review for legal sufficiency. The Commission's staff attorney reviewed the report and, on November 15, 2010, issued a Legal Concurrence: Cause citing both statutory and case law supporting the Determination. The Legal Concurrence concluded that there is reasonable cause to believe that Respondent discriminated against Complainant. On or about November 17, 2010, the Commission issued a Notice of Determination (Cause), charging Respondent with engaging in discriminatory housing practices in violation of the Fair Housing Act, reflecting the October 20, 2010, findings of the Determination. On or about March 2, 2011, the Commission filed a Notice of Failure of Conciliation after a conciliation agreement had not been entered into with Sunbeach, and the complaint had not been withdrawn. On or about January 26, 2011, Amadiz elected to have the Commission represent her and seek relief in the proceeding and resolve the charge in an administrative proceeding before DOAH. On or about March 3, 2011, the Commission filed the Petition for Relief before DOAH on Amadiz's behalf. On December 12, 2011, the Commission moved to withdraw from the underlying proceeding, citing "significant and irreconcilable differences." On December 13, 2011, after a hearing on the motion, the undersigned entered an Order allowing the Commission's withdrawal. The Order also cancelled the final hearing scheduled for December 14, 2011, and provided Amadiz until January 23, 2012, to obtain new counsel to represent her in the matter. Amadiz subsequently notified DOAH of her intent to proceed pro se. Amadiz proceeded to hearing without counsel. The final hearing was held before the undersigned on May 9, 2012. The undersigned entered a Recommended Order on August 16, 2012, recommending the dismissal of Amadiz's Petition for Relief in its entirety. On October 9, 2012, Sunbeach filed a Motion for Award of Attorneys' Fees and Costs against the Commission. On October 30, 2012, the Commission entered a Final Order Dismissing Petition for Relief from Discriminatory Housing Practice, adopting the undersigned's Recommended Order and dismissing the action of Amadiz. Sunbeach was represented by counsel, a 30-year AV-rated lawyer, who defended the underlying action for a period of over two years. Sunbeach's counsel billed 75.8 hours of service at $150.00 per hour. The amount of attorney's fees claimed in this matter is $10,460.00 and costs of $2,277.47 for a total of $12,737.47, which is being sought in the matter.
