The Issue Whether Petitioner owes sales and use tax (plus penalties and interest) to the Department of Revenue (Department), as alleged in the Department's November 1, 1999, Notice of Decision.
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole, the following findings of fact are made to supplement and clarify the Stipulations of Fact set forth in the parties' Joint Pre-Hearing Stipulation: 1/ Mr. Wiviott is a very successful, "hands-on" entrepreneur who presently owns approximately five or six businesses. Since 1958, when he and his brother opened a carpet store in Milwaukee, Mr. Wiviott has owned approximately 30 different businesses (including nine restaurants and a yacht service business), many of which he has sold "for literally millions of dollars of profit." Approximately two-thirds of the businesses that he has owned he has "started from scratch." There have been instances where Mr. Wiviott has invested in businesses that were in industries in which, at the time of his investment, he had no prior experience. In these instances, he overcame his lack of experience by being "extremely industrious" and doing "research." When Mr. Wiviott has needed to consider a "feminine viewpoint" in making a business decision, he has used Mrs. Wiviott, his wife of 43 years, as a "sounding board." For the past 35 years, William Becker has been Mr. Wiviott's accountant. In 1991 or 1992, Mr. Wiviott purchased two "brand new" boats as business investments. The boats were sold to Mr. Wiviott together as a package. Mr. Wiviott paid a total of $1.1 million for the two boats. The larger of the boats was a 63-foot sport fisherman. Although unfinished, it was seaworthy. Mr. Wiviott named this boat the "Choice One." Mr. Wiviott named the other boat, a 56-foot sport fisherman, the "Choice Too." Mr. Wiviott accepted delivery of the Choice One and Choice Too in the Bahamas. He did not pay any sales tax on his purchase of the boats. After accepting delivery, Mr. Wiviott brought the boats to Fort Lauderdale. In 1993, Mr. Wiviott explored the possibility of entering (for the first time) the yacht charter business. He spoke to various people involved in the industry, including two charter brokers (Bob Offer and Bob Saxon) and a charter yacht owner (Bernie Little). He also had discussions with Mr. Becker. Together, he and Mr. Becker made cost and revenue projections. He ultimately made a "value judgment" to go into the business. Mr. Wiviott retained the services of Mr. Offer to help him find a suitable yacht for the business. One of the yachts that Mr. Offer showed Mr. Wiviott was the Fifty-One, a Washington State-built, Fort Lauderdale- based "mega" yacht owned by an Italian national, Dr. Moretti. The Fifty-One's interior design made it particularly well suited for chartering. It had four levels, including a sky deck/lounge equipped with a complete kitchen (to complement the galley located on the bottom level). There were five staterooms that could comfortably accommodate ten charter guests. Each of the regular staterooms had its own head. The master stateroom had "his and her" heads. There was also a stateroom for the captain, as well as quarters for six other crew members (the number needed to properly service a charter party). The Fifty-One had not been well maintained during the time it had been owned by Dr. Moretti. Although Dr. Moretti had made the Fifty-One available for charter, the yacht had a poor reputation among charter brokers and, as a result, it just "sat at the dock," unchartered, while under Dr. Moretti's ownership. In October of 1993, Mr. Wiviott offered to purchase the Fifty-One from Dr. Moretti for $5.1 million, subject to a satisfactory marine survey and sea trial. Dr. Moretti initially rejected the offer, but subsequently agreed to sell the Fifty- One at Mr. Wiviott's offering price (which was considerably less than the $9 million that Dr. Moretti had paid for the Fifty-One a year and a half earlier). Before the deal was consummated, Mr. Wiviott contracted with a marine survey company, Patton Marine, Inc. (Patton), to perform a thorough inspection of the Fifty-One. Patton performed an extensive pre-purchase survey of the Fifty-One, which included various sea trials and other tests (conducted in Fort Lauderdale and off the Fort Lauderdale coast). The survey revealed that the Fifty-One had various "deficiencies." Most of these "deficiencies" were "small items" and were remedied before the sale was finalized. The most serious of the remaining "deficiencies" was the excessive amount of interior vibration. Notwithstanding the known "deficiencies" that remained, Mr. Wiviott thought that, at $5.1 million, the Fifty- One was a good buy. At worst, he believed, he "could make a pretty good profit" by reselling the Fifty-One. Mr. Wiviott retained Robb Maass, whom Mr. Wiviott was told was the "top marine attorney in the [Fort Lauderdale] area," to assist him in forming a Florida corporation which would purchase the Fifty-One and operate a yacht charter business. With Mr. Maass' assistance, B. W. Marine, Inc. (Petitioner) was organized under the laws of the State of Florida, effective January 20, 1994, with Mr. Wiviott as its sole officer, director, and shareholder. Petitioner's principal corporate address was, at the time of incorporation, and has remained, 757 Southeast 17th Street, #389, Fort Lauderdale, Florida 33316. On January 28, 1994, shortly after Petitioner's incorporation, Petitioner closed on the purchase of the Fifty- One. No Florida or other state sales tax was paid on the purchase. The newly purchased yacht (which had been registered in the Cayman Islands by the previous owner, Dr. Moretti) was immediately registered with the United States Coast Guard, and it thereafter began to fly an American flag. Based upon on Mr. Maass’ advice, Petitioner also took steps to obtain a "certificate of documentation with appropriate endorsement for employment in the coastwise trade" for the Fifty-One. It was not until the following year, however, that the United States Congress (passing a bill introduced by Florida Congressman E. Clay Shaw, Jr.) authorized the Secretary of Transportation to issue such a "certificate of documentation." 2/ After taking delivery of the yacht in the Bahamas, Petitioner imported the Fifty-One into Florida. It did so because Mr. Wiviott wanted the Fifty-One to be marketed in the south Florida area and to have access to the exceptional yacht repair and maintenance facilities that were available there. The South Florida area is where the "mega" yacht charter brokers (who, in most instances, effectively "make[] the decision [as to] which boat a charter client is going to use") are concentrated and where the reputation (or, as Mr. Wiviott put it in his hearing testimony, the "aura" or illusion") of a "mega" yacht is established (in part, by the owner, captain, and crew "pander[ing]" to the broker community during showings of the yacht). It is therefore important for a "mega" yacht available for charter to have a presence in the south Florida area so that it can seen by, and shown to, the "mega" charter brokers who are concentrated there. Although most "mega" yachts are marketed in Florida, "the chartering experience [generally occurs] elsewhere," in such places as New England (in the summer) and the Caribbean and Mediterranean (in the winter). Aware of this, Mr. Wiviott, at the time that the Fifty-One was imported into Florida, had no expectation that that the Fifty-One would be used exclusively for charters in Florida waters. Mr. Wiviott wanted the Fifty-One to be imported into Florida without Petitioner having to pay any use tax. Mr. Maass advised Mr. Wiviott that Petitioner would not have to pay Florida use tax if it registered with the Department as a "dealer" and used the Fifty-One "only . . . for bare boat charter[s]." Mr. Maass cautioned Mr. Wiviott that "[t]here could be no personal recreational use, no personal use aboard the boat whatsoever." Before importing the Fifty-One into Florida, Petitioner registered with the Department as a "dealer" that would be engaging in "bare boat" charter operations in Florida. Mark Newcomer was the first captain of the Fifty-One under Petitioner's ownership. Mr. Wiviott considered Captain Newcomer to be, not a "charter captain," but a "yard captain," that is, a captain "who specializes in repairs, maintenance and upgrades of yachts." Captain Newcomer was hired by Petitioner "to take delivery [of the Fifty-One] and to oversee the renovation and retrofit[ting] of the yacht." He was responsible for ensuring that the Fifty-One was brought up to American Bureau of Shipping (ABS) standards. Obtaining certification that the Fifty-One met ABS standards was an "essential part" of any campaign to effectively "market[] the boat" for charter. Mr. Wiviott did not have any intention of continuing Captain Newcomer's employment with Petitioner following completion of "the renovation and retrofit[ting] of the yacht." Captain Newcomer brought the Fifty-One into Florida on or about February 1 or 2, 1994, and docked it at a Fort Lauderdale marina (either Pier 66 Marina or the Bahia Mar Marina). On February 3, 1994, Captain Newcomer moved the Fifty- One to the Bradford Marine Shipyard (Bradford Marine), a Department-registered Fort Lauderdale repair facility able to service boats up to 150 feet in length. The Fifty-One underwent repairs and improvements at Bradford Marine until February 12, 1994, by which time the work that had to be done with it out of the water had been completed. At Bradford Marine, Petitioner had to pay a 20 to 30 percent "surcharge on all outside vendors that c[a]me in." On February 13, 1994, Captain Newcomer moved the Fifty-One to the Bahia Mar Marina (Bahia Mar), a more cost- effective location, to do (with the help of others) the remaining repair and improvement work on the yacht (which could be done with the yacht in the water). Because Captain Newcomer was "very good friends" with the dockmaster at the Bahia Mar, he and those he supervised were allowed to perform work on the Fifty-One (involving the use of noise-generating power tools) that would have otherwise been prohibited. The Fifty-One remained at the Bahia Mar until March 14, 1994, undergoing repairs and improvements. On March 15, 1994, Captain Newcomer, accompanied by Mr. and Mrs. Wiviott (and with less than a full crew), took the Fifty-One on a cruise to the Jockey Club, a "private club" that was part of a "condominium complex resort" located in Miami. He did so pursuant to the instructions of Mr. Wiviott, with whom he spoke to on a daily basis regarding the repair and improvement work that was being done on the Fifty-One under his (Captain Newcomer's) supervision. Mr. Wiviott wanted "to take the boat out to stretch it out [and to] see the progress that Captain Newcomer was making." Furthermore, Mr. Wiviott thought that it was important for Petitioner's charter business for the Fifty- One "to be seen." Near the Jockey Club, the Fifty-One ran aground "in the mud," where it "sat . . . for about eight hours until the tide came back in." After the Fifty-One arrived at the Jockey Club, divers "g[o]t under the boat and clean[ed] the prop[eller]s [and] clean[ed] the drivetrain." The Fifty-One remained docked at the Jockey Club for three days. On March 17, 1994, the Fifty-One returned to the Bahia Mar to undergo further repairs and improvements. By mid-April of 1994, the work necessary to bring the Fifty-One up to ABS standards had been completed. Petitioner therefore applied for, and on April 19, 1994, was issued, an ABS "Class Certificate." The Fort Lauderdale Charter Broker's Boat Show (1994 Boat Show) was held at Pier 66 Marina (Pier 66) from April 14, 1994 to April 20, 1994. The Fifty-One was one of the boats entered in the 1994 Boat Show, and it remained at Pier 66 for the entire show. Mr. Wiviott was aboard throughout the event to show the boat to charter brokers and others. Captain Newcomer helped Mr. Wiviott show the boat. Food and drinks were served. Fresh flowers adorned the boat. The crew wore their dress uniforms. After the end of each day's session, Mr. Wiviott stayed aboard the Fifty-One overnight in lieu of spending company money to rent a hotel room. Following the 1994 Boat Show, from April 20, 1994 until April 28, 1994, the Fifty-one was taken on a "shakedown" cruise to Key West and back to Fort Lauderdale, during which it was run at various speeds and systems were "overloaded" to determine whether they worked properly. At the time of the cruise, the Fifty-One was not equipped with all of the staff and other accoutrements necessary to provide the "five star service" that those who charter "mega" yachts pay to receive. During the cruise, the boat docked at the Ocean Reef Club, an exclusive private resort community in Key Largo; the Galleon Marina, a public facility in Key West; Fisher Island; and the Jockey Club. There were a "few breakdowns" during the cruise, including a "crane breakdown" at the Ocean Reef Club. With the help of vendors, the necessary repairs were made. Aboard during the cruise, in addition to Captain Newcomer and a partial crew, was Mr. and Mrs. Wiviott; Mr. Wiviott's brother, Howard Wiviott; Howard's wife; Mr. Becker, whose firm provided Petitioner with accounting services (primarily through the efforts of Stacey Torchon, one of its accountants); and Mr. Becker's wife. There was no marine surveyor, no representative of a registered repair facility, and no "mega" yacht charter broker aboard during the cruise. 3/ Mr. Becker and his wife did not remain aboard for the entire cruise. They disembarked in Key Largo on April 23, 1994. During the time that he was aboard, Mr. Becker spoke to Captain Newcomer and the crew about the financial and accounting procedures that needed to be followed in conducting Petitioner's charter operations, information that Mr. Becker could have provided by telephone from his California office. (Stacey Torchon, who was "more involved [than Mr. Becker] in the day-to-day operations" of Petitioner, never met personally with any Fifty-One crew member; rather, she communicated with the crew by telephone.) While they were aboard, Mr. Becker and the other guests Mr. Wiviott had invited to take part in the cruise (referred to, collectively, hereinafter as the "Invited Guests") ate, relaxed, and enjoyed the hospitality and ambiance. The Invited Guests' presence on the Fifty-One during the "shakedown" cruise was not solely for the purpose of furthering Petitioner's charter business. Mr. Wiviott was motivated by personal reasons in inviting them aboard. The assertion (made by Petitioner in its Proposed Recommended Order) that one of the purposes of the "shakedown" cruise was to determine, through the feedback given by the Invited Guests, "whether the Petitioner was delivering the chartering experience in terms of comfort, ambiance and service that people willing to spen[d] $50,000 per week would expect" simply does not ring true. Mr. Wiviott knew full well that the Fifty-One, with a "yard captain" at the helm and less than a full crew, was not equipped to provide such service. He did not need to take the "Fifty-One" on a lengthy cruise with family and friends to find this out. Had Mr. Wiviott really wanted to learn if the Fifty-One offered a "chartering experience" for which someone would be willing to pay $50,000.00, he would have asked "mega" yacht charter brokers, not family and friends, to come aboard the Fifty-One for a cruise and give him their feedback. On April 28, 1994, following the "shakedown" cruise, the Fifty-One returned to the Bahia Mar, where, in the ensuing days, defects discovered during the "shakedown" cruise were remedied. By May 7, 1994, the Fifty-One was ready for charter. The Fifty-One, at that time, was not the only vessel in Petitioner's fleet. Shortly after acquiring the Fifty-One, Petitioner had purchased (in Florida) the Choice One and Choice Too 4/ from Mr. Wiviott. Petitioner paid Mr. Wiviott $1,138,804.28 for the Choice One. Inasmuch as the purchase was made under Petitioner's sales tax exemption certificate (that Petitioner had obtained from the Department based upon its representation that it intended to use the Fifty-One exclusively for "bare boat" charter operations in Florida), no Florida sales tax was paid. At the time of the purchase, Mr. Wiviott envisioned that Petitioner would use the Choice One as a "chase boat" for the Fifty-One (from which charterers and guests could fish). The Choice One, however, was never used by Petitioner for this purpose because it turned out that it was not feasible to do so. The Choice One wound up sitting at the dock in Fort Lauderdale, leaving only "to be stretched" or moved to another docking facility by its captain (initially Steven Ernst and then later Carl Roberts). Before its sale by Petitioner in 1995, the Choice One was chartered on only one occasion, during which time it remained at the dock in Fort Lauderdale (positioned so that those aboard could view a passing "boat parade"). The Fifty-One was chartered on a more frequent basis. Of the 15 charters of the Fifty-One during the Audit Period, however, only two (the Gerardo Cabrera and Jean Foss charters) were in Florida waters. The Gerardo Cabrera charter was the first charter of the Fifty-One following the completion of the "renovation and retrofit[ting] of the yacht." It started in Fort Lauderdale on May 18, 1994, and ended in Fort Lauderdale on May 21, 1994. The captain of the Fifty-One for the Gerardo Cabrera charter was Jon Cheney, who had replaced Captain Newcomer on May 7, 1994. The charter agreement between Petitioner (as the "Owner") and Mr. Cabrera (as the "Charterer") was dated May 13, 1994, and read, in pertinent part, as follows: In consideration of the covenants hereinafter contained, the Owner agrees to let and the Charter[er] agrees to hire the Yacht from noon on the 18th of May 1994 to noon on the 21st of May 1994 for the total sum of $18,000.00 + expenses + 6% FSST ($1,080 Dollars) of which amount $18,000 + $1,080 + $5,000 (ADVANCE toward expenses) for a total of $24,080 shall be paid on the signing of this Agreement . . . . The Owner agrees to deliver the Yacht at Bahia Mar Yachting Centre, Ft. Laud. on the 18th day of May 1994 in full commission and working order, outfitted as a yacht of her size, type and accommodations, with full equipment, inclusive of that required by law, and fully furnished, including galley and dining utensils and blankets; staunch, clean and in good condition throughout and ready for service; and agrees to allow demurrage pro rata to the Charterer for any delay in delivery. . . . The owner's insurance policy does not cover Charterer's protection and indemnity during the term of the Charter. . . . * * * The Charterer agrees to accept the yacht delivered as hereinbefore provided and to pay all running expenses during the term of the charter. The Charterer, his agents and employees have no right or power to permit or suffer the creation of any maritime liens against the yacht, except the crew's wages and salvage. The Charterer agrees to indemnify the Owner for any charges or losses in connection therewith, including reasonable attorney's fees. * * * The Charter[er] agrees to redeliver the yacht . . . to the Owner at Bahia Mar Yachting Centre, Ft. Lauderdale, FL . . . . The Charter[er] agrees that the yacht shall be employed exclusively as a pleasure vessel for the sole and proper use of himself, his family, guests and servants during the term of this charter and shall not transport merchandise or carry passengers for pay, or engage in any trade nor in any way violate the Revenue Laws of the United States, or any other Government within the jurisdiction of which the yacht may be at any time, and shall comply with law in all other respects. * * * 11. It is mutually agreed that full authority regarding the operation and management of the yacht is hereby transferred to the Charter[er] for the term thereof. In the event, however, that the Charterer wishes to utilize the services of a Captain and/or crew members in connection with the operation and management of the yacht, whether said Captain and/or crew members are furnished by the Owner or by the Charterer, it is agreed that said Captain and/or Crew members are agents and employees of the Charterer and not of the Owner. In the further event that local United States Coast Guard or other regulations require the Owner exclusively to provide a Captain and/or crew, or the Owner wishes to provide his own Captain and/or crew, the Owner agrees to provide a Captain who is competent not only in coastwise piloting but in deep sea navigation, and to provide a proper crew. The Captain shall in no way be the agent of the Owner, except that he shall handle clearance and the normal running of the yacht subject to the limitations of this charter party. The Captain shall receive orders from the Charterer as to ports to be called at and the general course of the voyage, but the Captain shall be responsible for the safe navigation of the yacht, and the Charterer shall abide by his judgment as to sailing, weather, anchorages, and pertinent matters. The Charterer assumes total control and liability as if the Charterer were the owner of the yacht during the term of the charter. . . . This agreement, by "industry standard," is "considered a 'bare boat' charter agreement." On May 13, 1994, Mr. Cabrera (as "Employer") also entered into a separate "Yacht Employment Agreement" with Captain Cheney (as "Yacht Captain"). It provided as follows: WHEREAS, Charterer has under charter the yacht FIFTY ONE pursuant to his bare boat charter party agreement wherein it is Employer's obligation to furnish the said yacht with a competent master and crew; and WHEREAS, Yacht Captain is a competent master, having over two years' experience in the coastal and inland waters of FLORIDA and THE BAHAMAS and is able to furnish a crew for the management and navigation of the said yacht; and WHEREAS, the parties desire to reduce their agreement to written term; NOW THEREFORE in consideration of the premises and of the agreements hereinafter contained, it is agreed as follows: Employer hereby hires yacht Captain as the Master of the said yacht to act as such Master as long as the yacht is under charter to Employer. Yacht Captain agrees to furnish 6 crew men to assist in operating and navigating the said yacht. The Captain and crew, if any, shall be properly uniformed. The crew to comprise the following: [left blank] Yacht Captain shall be paid for his services and the services of his crew a total sum of TEN DOLLARS AND OTHER GOOD AND VALUABLE CONSIDERATION and Employer shall furnish the Yacht Captain and his crew, quarters and food, during the term of this Agreement. The term of this Agreement shall commence on the 18th day of MAY 1994, or at such time that the yacht shall be ready to sail pursuant to the bare boat charter party agreement with the Owner and shall terminate on the 21st day of MAY, 1994, unless sooner terminated by the termination of the yacht party agreement for any reason whatsoever. In the event that the yacht charter party agreement is sooner terminated, the Master and crew will receive a pro-rated share of the agreed compensation for their services. After collecting from Mr. Cabrera all the monies Mr. Cabrera owed under both the charter agreement and the "Yacht Employment Agreement," Rikki Davis (the broker representing Mr. Cabrera) handed these monies over to Mr. Offer (the broker representing Petitioner). (It is commonplace in the "mega" yacht chartering industry "to have the amount paid for the use of the vessel under [a] bare boat charter agreement and amount for the captain and crew paid together by the charterer as a lump sum."). Mr. Offer, in turn, forwarded the monies he was given by Ms. Davis to Petitioner. The Gerardo Cabrera charter was the only charter that took place before the captain and crew of the Fifty-One became employees of Papa's Yacht Services, Inc. (Papa's), Petitioner's sister corporation, which, like Petitioner, was incorporated in Florida and has maintained a Florida corporate address from its inception. Papa's was formed solely for the purpose of enabling Petitioner to be in "compliance [with] the bare boat charter concept." Papa's dealings with Petitioner was Papa's sole source of revenue. Petitioner paid Papa's a "management fee" for providing a captain and crew for the Fifty-One. Although the Fifty-One's captain and crew had become Papa's employees, Petitioner continued to pay for their health insurance and provide them with free room and board on the Fifty-One at all times during the Audit Period, except when the Fifty-One was under charter and the charterers provided the captain and crew with room and board. Having a full-time captain and crew aboard a "mega" yacht available for charter, even when the yacht is not under charter, is essential to conduct successful charter operations. The captain and crew must be available, on the vessel, to host the "mega" yacht charter brokers who come aboard between charters (sometimes with little or no advance notice) and to perform those everyday tasks necessary to maintain the vessel. To attract and keep qualified onboard personnel, it is necessary to provide them with, as part of their compensation package, free room and board on the "mega" yacht. Doing so is the "standard in the industry." The Fifty-One was chartered by Jean Foss from December 27, 1995 to January 3, 1996, approximately a year and a half after Papa's had become the employer of the Fifty-One's captain and crew. Ms. Foss cruised to the Bahamas during the charter. The charter originated and concluded in Fort Lauderdale. "[T]he only reason [the Fifty-One] was in Florida [for the charter was] because [Ms. Foss] wouldn't fly to the Bahamas." The charter agreement between Petitioner (as the "Owner") and Mr. Foss (as the "Charterer") was similar to the charter agreement into which Mr. Cabrera and Petitioner had entered. It was dated August 15, 1995, and read, in pertinent part, as follows: TERM, HIRE & PAYMENTS: In consideration of the covenants hereinafter contained, the OWNER agrees to let and the CHARTERER agrees to hire the Yacht for the term from 12 noon . . . on the 27th day of December, 1995 to 12 noon . . . on the 3rd day January, 1996 for the total sum of $44,800 + All Expenses of which amount $22,400.00 shall be paid on the signing of this AGREEMENT and the balance thereof as follows: remaining 50% deposit (US$22,400.00) and Florida State Sales Tax of 6% US$2,668 for a total sum of $25,088.00 due by 24 November, 1995. DELIVERY. The OWNER agrees to deliver the yacht to CHARTERER at Fort Lauderdale, Florida at 12 noon . . . on the 27th day of December, 1995, in full commission and in proper working order, outfitted as a yacht of her size, type, and accommodations, with safety equipment required by law, and fully furnished, including gallery and dining utensils and blankets; staunch, clean and in good condition throughout and ready for service, and agrees to allow demurrage pro rata to the CHARTERER for any delay in delivery. . . . * * * 5. RUNNING EXPENSES. The Charterer agrees to accept the yacht as delivered as hereinbefore provided and to pay all shipboard expenses during the term of the charter period. * * * 8. RE-DELIVERY and INDEMNIFICATION. The CHARTERER agrees to redeliver the yacht, her equipment, and furnishings, free and clear and of any indebtedness for CHARTERER's account at the expiration of this charter, to the OWNER at Fort Lauderdale, Florida at 12:00 noon on the 3rd day of January, 1996 in as good condition as when delivery was taken, ordinary wear and tear and any loss or damage for which the OWNER is covered by his own insurance, and CHARTERER's insurance (if any) set forth in Paragraph 3 of this AGREEMENT, excepted. . . . * * * 10. RESTRICTED USE. The CHARTERER agrees that the yacht shall be employed exclusively as a pleasure vessel for the sole and proper use of himself, his family, passengers and servants, during the term of this charter, and shall not transport merchandise, or carry passengers for hire, or engage in any trade, nor any way violate the Revenue Laws of the United States, or any other Government within the jurisdiction of which the yacht may be at any time, and shall comply with the laws in all other respects. * * * 12. CHARTERER'S AUTHORITY OVER CREW. It is mutually agreed that full authority regarding the operation and management of the yacht is hereby transferred to the CHARTERER for the term thereof. In the event, however, that the CHARTERER wished to utilize the services of a captain and/or crew members in connection with the operation and management of the yacht, whether said captain and/or crew members are furnished by the OWNER or by the CHARTERER, it is agreed that said captain and/or crew members are agents and employees of the CHARTERER and not of the OWNER. In the further event that local United States Coast Guard or other regulations require the OWNER exclusively to provide a captain and/or crew, or the OWNER agrees to provide a proper captain who is competent not only to coastwise piloting, but in deep sea navigation, and to provide crew, the captain shall in no way be the agent of the OWNER, except that he shall handle clearance and the normal running of the yacht subject to ports to be called at, and the general course of the voyage. The captain shall be responsible for the safe navigation of the yacht, and the CHARTERER shall abide by his judgment as to sailing, weather, anchorages, and pertinent matters. The captain and crew shall be selected by the CHARTERER with the approval of the OWNER or the OWNER's Agent. CHARTERER is aware that he has a choice of captains. CHARTERER has full right to terminate the captain and/or crew; however, replacements shall be hired as under Paragraph 12 of this AGREEMENT. . . . Ms. Foss also entered into a "Yacht Services Agreement." The agreement, dated August 16, 1995, was with Papa's, which agreed to provide a seven person crew for the Fifty-One for the charter period (December 27, 1995, through January 3, 1996). Ms. Foss, in turn, agreed to pay Papa's $11,200.00 for such crew services and, in addition, to provide the captain (Arthur "Butch" Vogelsang) and crew with food and quarters aboard the Fifty-One during the charter period. Petitioner collected and remitted to the Department the sales tax owed by Mr. Cabrera and Ms. Foss on their rentals of the Fifty-One. No Florida sales tax was due on any of the other 13 charters of the Fifty-One during the Audit Period because they all took place outside Florida. In the case of 11 of these 13 other charters, like in the Jean Foss charter, the charterer entered into a charter agreement with Petitioner for the rental of the Fifty-One, as well as a separate agreement with Papa's for employment of a captain and crew for a fee (that "represent[ed] the actual cost [to Papa's] of the crew"). Typically, the total amount due under both agreements was sent to Petitioner, and Mr. Becker's firm (which also provided accounting services to Papa's) "moved the [portion of the] funds" due Papa's to Papa's bank account. Two charterers during the Audit Period (Mutual of Omaha Marketing Company and Prince Faisal Aziz of Saudi Arabia) refused Mr. Wiviott's request that they enter into two separate agreements, one (with Petitioner) for the rental of the Fifty- One and another (with Papa's) for employment of a captain and crew. Instead, they insisted on signing a single document, a Mediterranean Yacht Brokers Agreement (or MYBA Agreement), wherein Petitioner agreed to provide both the Fifty-One and a captain and crew. Not wanting to lose the business, Mr. Wiviott, on behalf of Petitioner, entered into these MYBA Agreements, notwithstanding that he had been instructed by Mr. Maass "not [to] take MYBA contracts." The MYBA Agreement between Petitioner (as "Owner") and Mutual of Omaha Marketing Company (as "Charterer") was dated December 16, 1995, and provided that: the "charter period" would begin 12:00 noon on March 3, 1996, and end 12:00 noon on March 17, 1996; the "cruising area" would be the Caribbean; the "port of delivery" would be Guadeloupe; the "port of re- delivery" would be Grenada; the crew would consist of a captain and six other crew members; the charter fee would be $48,000.00 per week for a total (for 2 weeks) of $96,000.00; the "Advance Provisioning Allowance" would be $48,000.00; and the "delivery/re-delivery fee" would be $6,857.00. In addition, it contained the following "clauses," among others: CLAUSE 1 AGREEMENT TO LET AND HIRE The OWNER agrees to let the Yacht to the Charterer and not to enter into any other Agreement . . . for the Charter of the Yacht for the [s]ame period. The CHARTERER agrees to hire the Yacht and shall pay the Charter Fee, the Security Deposit, the Advance Provisioning Allowance and any other agreed charges in cleared funds, on or before the dates and to the Account specified in this Agreement. * * * CLAUSE 6 CREW The OWNER shall provide a suitably qualified Captain acceptable to the insurers of the Yacht and a suitably experienced Crew, properly uniformed, fed and insured. The OWNER shall ensure that no member of the Crew shall carry or use any illegal drugs on board the Yacht or keep any firearms on board (other than those declared on the manifest) and shall ensure that the Captain and Crew comply with the laws and regulations of any country into whose waters the yacht shall enter during the course of this Agreement. The MYBA Agreement between Petitioner (as "Owner") and Prince Aziz (as "Charterer") was dated March 19, 1996, and provided that: the "charter period" would begin 12:00 noon on April 2, 1996, and end 12:00 noon on April 9, 1996; the "cruising area" would be the Caribbean; St. Maarten would be the "port of delivery" and "the port of re-delivery"; the crew would consist of a captain and six other crew members; the charter fee would be $50,000.00; and the "Advance Provisioning Allowance" would be $10,000.00. It contained the following additional provisions, among others: 30. AGREEMENT TO LET The OWNER shall let the yacht for the charter period and agrees not to enter into any other agreement for the charter of the yacht for the same period, and agrees not to sell the yacht before completion of the charter period, unless otherwise agreed by the Charterer. * * * 32. CREW The Owner shall provide a properly qualified Captain approved by the insurers of the yacht and a properly qualified crew, uniformed and insured. . . . Upon the advice of Mr. Maass, Petitioner assigned to Papa's its MYBA Agreements with Mutual of Omaha Marketing Company and Prince Aziz. It also entered into "Bareboat Charter Agreements" with Papa's for the rental of the Fifty-One for the same periods covered by the MYBA Agreements (notwithstanding that the MYBA Agreements expressly prohibited Petitioner from doing so). According to what Mr. Maass told Mr. Wiviott, by Petitioner taking such action, "the MYBA contract[s] could be accepted without violating the requirement that [Petitioner] engage only in bare boat chartering." The written assignment of the MYBA Agreement with Mutual of Omaha Marketing Company was dated December 16, 1995, the same date as the MYBA Agreement, and read, in pertinent part, as follows: BW Marine owns the vessel "Fifty-One," a 125 foot motoryacht, bearing official number 1020419 (the "Vessel"); BW Marine entered into a Yacht Charter Party Agreement dated December 16, 199[5] (the "Charter") between BW Marine and Mutual of Omaha Marketing Company (Charterer"); BW Marine desires to assign to Papa's Yacht Services, and Papa's Yacht Services agrees to accept, all BW Marine's right, title, and interest in and to the Charter; NOW THEREFORE, in consideration of the premises, the mutual covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: Assignment BW Marine assigns to Papa's Yacht Services all its right, title, and interest in and to the Charter. Papa's Yacht Services accepts the assignment and assumes all obligations of BW Marine under the Charter. Payment For administrative convenience, Charterer shall pay BW Marine the charter hire under the Charter. BW Marine, in turn, shall remit the surplus of these funds over the lease amount due from Papa's Yacht Services to BW Marine under that certain Bare Boat Charter Agreement between the parties of even date herewith. . . . Mutual of Omaha Marketing Company was not a signatory to this written assignment (and no other document offered into evidence reflects that Mutual of Omaha Marketing Company consented to the assignment). 5/ The written assignment of the MYBA Agreement with Prince Aziz was dated March 19, 1996, the same date as the MYBA Agreement. It was identical to the December 16, 1995, written assignment of the MYBA Agreement with Mutual of Omaha Marketing Company (with the exception of the dates contained therein). Prince Aziz was not a signatory to this written assignment (and no other document offered into evidence reflects that Prince Aziz consented to the assignment). The first "Bareboat Charter Agreement" between Petitioner (as "Owner") and Papa's (as "Charterer") was dated December 16, 1995, and provided, in pertinent part, as follows: Owner owns the vessel "Fifty-One," a 125 foot motorcoach bearing official number 1020419 (the "Vessel"); and Charterer desires to charter the Vessel from Owner and Owner is willing to make the Vessel available to Charterer for such purpose, subject to the terms and conditions contained herein. NOW THEREFORE, in consideration of the premises and the mutual covenants hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: Term Owner agrees to let and Charterer to hire, the Vessel for a term commencing March 3, 1996, and ending March 17, 1996. Payment Charterer shall pay Owner charter hire of One Hundred Two Thousand Eight Hundred Fifty Seven Dollars ($102,857.00), plus state sales tax, if applicable. Control The Vessel is chartered on a bare boat or demise basis. Owner hereby transfers to Charterer full authority regarding the operation and management of the Vessel for the charter term. Charterer is solely responsible for retaining a master and crew. Guest Limitation When the Vessel is underway, the number of persons on board the Vessel, other than the master and crew, shall be limited to the Charterer (or the Charterer's representative, if Charterer is a corporation) and twelve (12) guests. * * * Delivery Owner agrees to deliver the Vessel at Guadeloupe. Redelivery Charterer shall redeliver the Vessel to Owner at Granada at the end of the charter term, in as good condition as when delivery was taken, ordinary wear and tear excepted. . . . * * * 9. Expenses Charterer shall pay all running expenses during the term of the charter. Charterer shall pay for routine maintenance and repair of the Vessel during the charter term. * * * 12. Non-Assignment Charterer agrees not to assign this Agreement or subcharter the Vessel without the consent of the Owner in writing, which Owner may withhold in Owner's sole discretion. . . . The second "Bareboat Charter Agreement" between Petitioner and Papa's was dated March 19, 1996, and was identical to the first "Bareboat Charter Agreement" between them (with the exception of the charter period, charter cost, and delivery/redelivery locations). The evidence is insufficient to support a finding that Papa's ever entered into a sub-charter agreement with either Mutual of Omaha Marketing Company or Prince Aziz. Both Mutual of Omaha Marketing Company and Prince Aziz paid Petitioner the entire charter fee prescribed under their respective MYBA Agreements. They did not make any payments to Papa's. Petitioner paid Papa’s a “management fee” for providing the captain and crew during these charters. On one of the 15 charters during the Audit Period, Mr. Wiviott was aboard the Fifty-One as a guest of the charterer, the Choice Meat Co., Inc., a company that he and his son, Greg Wiviott, owned. Choice Meat Co., Inc., paid the "going charter rate" for the rental, but no broker's commission because "there was no broker to pay." There were occasions during the Audit Period, when the Fifty-One was not under charter, that Mr. Wiviott, members of his family (including his wife; children; grandchildren; his bother, Howard; and Howard's wife), and his friends used the Fifty-One outside Florida for non-business-related, personal purposes, sometimes for "one or two weeks at a time." For instance, in June of 1994 (after the Gerardo Cabrera charter and before the next charter, which began on July 21, 1994), when the Fifty-One was in New England, the Wiviott family was aboard for approximately "a couple of weeks." At the end of that summer, just before the Fifty-One returned from New England to Fort Lauderdale, the family again used the Fifty-One, this time "for a week or so." In November of 1994, around the Thanksgiving holiday, the Fifty-One traveled to the Caribbean so that the family could use it there for recreational purposes. The Fifty-One remained in the Caribbean for ten to 14 days with the family aboard. After the Wiviott children and grandchildren got off, the Fifty- One went on to the Virgin Islands, where Mr. and Mrs. Wiviott's friends came aboard and were entertained by the Wiviotts. In January of 1995, some time "shortly after the 1st," when the Fifty-One was in St. Maarten (where it was based for the winter), the Wiviott family once again spent time aboard the Fifty-One. The foregoing instances of out-of-state, non-charter, non-business-related use of the Fifty-One by the Wiviott family occurred when Captain Cheney was in command of the vessel. The Wiviott family continued to make such use of the Fifty-One during the time Captain Elario was captain. When Captain Elario took over the Fifty-One in St. Lucia (from Paul Canvaghn, who had been captain for only a day or two), Mr. and Mrs. Wiviott were aboard the vessel. They remained on board for approximately a week as the Fifty-One cruised the Caribbean. During that week, Mrs. Wiviott swam, laid in the sun, relaxed, and ate meals prepared by the Fifty- One's chef. She did not perform any tasks designed to further Petitioner's charter business. Subsequently, while Captain Elario was still captain, Mr. and Mrs. Wiviott took a non-charter, non-business-related trip on the Fifty-One to the Bahamas. Also during the time Captain Elario was captain, when the Fifty-One was in Hilton Head, South Carolina, Mr. Wiviott's brother, Howard, and Howard's wife, came aboard, and they remained on the yacht as it traveled to Norfolk, Virginia. Howard and his wife did not perform any tasks designed to further Petitioner's charter business while aboard the Fifty- One. Mr. and Mrs. Wiviott's daughter, along with her two young children, stayed overnight on the Fifty-One when, while under Captain Elario's supervision, it was docked at the Capital Marina in Washington, D.C. During the daughter's and children's stay, there was a party celebrating the youngest child's birthday. Indicative of the amount of time that Mr. and Mrs. Wiviott spent aboard the Fifty-One were the clothing and other personal items that (as a convenience) they stored (in a locker) on the Fifty-One (so that they would not have to bring these items with them each time they boarded the vessel). (These items were moved from the locker to another area on the Fifty- One, when necessary, to accommodate charterers using the stateroom in which the locker was located). Whenever the Fifty-One returned to Florida, it underwent needed repairs and maintenance. It also cruised the waters of the south Florida area, docking at various facilities. It did so not only "to be stretched," but to gain additional exposure among "mega" yacht charter brokers. In addition, while in Florida, the Fifty-One was stocked with supplies and provisions (including rack of lamb, veal, lobster tails, baked goods, gourmet foods, specialty items, wines, bath and beauty products, and party supplies) to be available for use by those on board when the Fifty-One was outside Florida, including not only charterers (such as Mutual of Omaha Marketing Company and Prince Aziz) and their guests, but also Mr. Wiviott, his family, and friends (when they were on board the Fifty-One for non-business-related, personal purposes). The Fifty-One, while in Florida, was also provided with fuel for charter, as well as non-charter, non-business related, trips outside Florida. Petitioner's charter business proved to be unprofitable. Expenses far exceeded revenues. (Petitioner, however, was able to sell the Fifty-One for more than the purchase price it had paid, receiving approximately $5.7 million, excluding commissions, for the Fifty-One in February of 2000.) By letter dated October 11, 1996, the Department informed Petitioner that it was going to audit Petitioner's "books and records" for the Audit Period. Petitioner was selected for audit because it had reported only a relatively small amount of taxable charter revenue on the Florida sales and use tax returns it filed during the Audit Period. The Department's "audit findings" were that the Fifty-One "was purchased for [a] dual purpose, for leasing and to be used by the shareholder" and therefore "the vessel and other purchases [made by Petitioner during the Audit Period under its sales tax exemption certificate, including its purchase of the Choice One] are taxable at the cost price." Based upon these audit findings, the Department issued a Notice of Intent to Make Audit Changes, in which it advised Petitioner that Petitioner owed $430,047.95 in sales and use taxes, $215,023.97 in penalties, and $169,672.70 in interest through July 18, 1997, for a total of $814,744.62, "plus additional interest of $141.39 per day . . . from 07/18/97 through the date [of] payment." By letter dated April 22, 1998, Petitioner protested the Department's proposed assessment. On November 1, 1999, the Department issued its Notice of Decision sustaining the proposed assessment and announcing that, as of October 6, 1999, Petitioner owed the Department $929,270.52, with "interest continu[ing] to accrue at $141.39 per day until the postmarked date of payment." Petitioner subsequently filed a Petition for Chapter 120 Administrative Hearing on the Department's proposed action.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Department enter a final order sustaining its assessment against Petitioner in its entirety. DONE AND ENTERED this 26th day of October, 2001, in Tallahassee, Leon County, Florida. STUART M. LERNER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 26th day of October, 2001.
The Issue Whether Charles Astore, Jr. is guilty of violation of Section 475.25(1)(a) and (2), Florida Statutes.
Findings Of Fact Charles Astore is a registered real estate salesman. Charles Astore was employed by International Land Services Chartered, Inc. He was paid by International Land Sales Chartered Inc.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, the Hearing Officer recommends that the Florida Real Estate Commission take no action against the registration of Charles Astore Jr. as a registered real estate salesman. DONE and ORDERED this 7th day of April, 1978, in Tallahassee, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISED: Manuel E. Oliver, Esquire Charles Felix, Esquire Florida Real Estate Commission 400 West Robinson Street Orlando, Florida 32801 Charles J. Astore, Jr. 501 N.W. 93rd Terrace Pembroke Pines, Florida 33023 ================================================================= AGENCY FINAL ORDER ================================================================= FLORIDA REAL ESTATE COMMISSION FLORIDA REAL ESTATE COMMISSION Plaintiff, CASE NO. 2952 DOAH CASE NO. 77-201 CHARLES J. ASTORE, JR., Defendant. /
The Issue The issue in this case is whether Respondent, Jerry Green, acted as a yacht and ship broker as defined in Section 326.022(1), Florida Statutes, without being licensed by Petitioner, the Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes, as alleged in a Notice to Show Cause entered September 3, 1996.
Findings Of Fact Petitioner, the Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes (hereinafter referred to as the “Division”), is an agency of the State of Florida. The Division is charged with the responsibility for carrying out the provisions of Chapter 326, Florida Statutes, the Florida Yacht and Ship Brokers’ Act (hereinafter referred to as the “Act”). Respondent is Jerry Green. Mr. Green is not licensed by the Division pursuant to the Act as a yacht and ship broker. At all times relevant to this proceeding, Mr. Green was employed at Rick’s on the River (hereinafter referred to as “Rick’s”), in Tampa, Florida. Mr. Green was compensated for his employment at Rick’s by being provided room and board. During 1996 the Division received an anonymous complaint including a copy of an advertisement from a October 13, 1995 edition of a publication known as the “West Florida Boat Trader”. The advertisement indicated it was from Rick’s and included several photographs of boats purportedly for sale at Rick’s. Among other boats listed on the advertisement was the following: 1975 42’POST Full Tuna Tower, Twin Turbo Charge Detroit 671 Out of Town Owner DESPARATE to Sell, $84,500 A similar advertisement was placed in the November 3, 1995 edition of the “West Florida Boat Trader”. Although Mr. Green denied at hearing that he had placed the advertisement, he admitted in his Response to Notice to Show Cause that “between October of 1995 and May of 1996 he advertised a 1975 42’ Post named the ‘Dunn Deal’ . . . .” He also admitted in the Response “that he advertised the 42’ Post at the request of the owner, Richard Dame, who is a personal friend, for the purpose of testing whether there was a market for such a boat and to determine the approximate value of the boat.” It is, therefore, concluded that Mr. Green was responsible for the advertisement. On May 31, 1996, James Courchaine, an investigator for the Division, went to Rick’s. After arriving at Rick’s, Mr. Courchaine met Mr. Green. Mr. Green identified himself as the “dockmaster”. Mr. Courchaine asked about the 42-foot Post and Mr. Green told him that he knew all about the Post and could talk to Mr. Courchaine about it. Mr. Green told Mr. Courchaine the Post belonged to a friend and that he, Mr. Green, could sell it. Mr. Green also indicated the Post was in Key West and that he wasn’t sure if the owner would be bringing it back. Mr. Green also told Mr. Courchaine that the owner was originally asking $84,500.00 for the Post but, that since it had been on the market so long without any interest, he might take between $79,000.00 and $81,000.00 for it. Mr. Courchaine asked Mr. Green whether the amount Mr. Green quoted included Mr. Green’s commission. Mr. Green told Mr. Courchaine that “he would be taken care of.” Mr. Green wasn’t employed as the dock master at Rick’s. Mr. Green lived on the premises and looked after the property, including boats located there. In return, he received room and meals. At the time of the formal hearing Mr. Green testified that he was not employed and that his only source of funds is Social Security. He also testified, however, that he still lives at Rick’s. The evidence failed to prove that Mr. Green has any source of funds other than Social Security. The evidence failed to prove that Mr. Green offered to sell any vessel regulated under the Act except as described in this Recommended Order.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered by the Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums, and Mobile Homes ordering Jerry Green to cease and desists from acting as an unlicensed broker in violation of the Act and that he pay a civil penalty in the amount of $500.00 within thirty days of the date this matter becomes final.DONE and ORDERED this 28th day of April, 1997, in Tallahassee, Florida. LARRY J. SARTIN 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 28th day of April, 1997. COPIES FURNISHED: Suzanne V. Estrella Senior Attorney Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1007 Paul T. Marks, Esquire Post Office Box 4048 Tampa, Florida 33677 Lynda L. Goodgame General Counsel Department of Business & Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Robert H. Elizey, Jr., Director Department of Business & Professional Regulation Florida Land Sales, Condominium & Mobil Homes 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue Did Respondent commit the violations alleged in the Administrative Complaint dated April 11, 2000, and if so, what discipline is appropriate?
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: The Department is the agency of the State of Florida charged with the responsibility of regulating the practice of contracting pursuant to Section 20.165, Florida Statutes, and Chapters 455 and 489, Florida Statutes. Respondent is, and has been at all times material hereto, a certified residential contractor in the State of Florida, having been issued license number CR CO13253 by the Florida Construction Industry Licensing Board. At all times material hereto, Respondent was licensed with the Construction Industry Licensing Board as an individual. On or about November 20, 1993, Respondent entered into a written contractual agreement (contract) with Kevin Watkins (Watkins) to construct a single family residence at 126 Meadow Lark Boulevard, Lot 65, Indian Lake Estates, Florida. The contract price was $333,944.00. Between December 7, 1993, and February 1, 1996, Watkins and Respondent executed 102 addenda to the contract which increased the contract price by approximately $241,874.43, for a total amount of approximately $575.818.43. On or about December 9, 1993, Respondent obtained permit number 93-120l850 from the Polk County Building Department and commenced work on the project. The contract provided that the "project shall be substantially completed on or about 195 days from the date all building permits are issued." However, due to the 100-plus addenda to the contract, it was estimated that an additional 190 days would be needed to complete the project. Additionally, construction ceased on the home for approximately 60 days so that Watkins could explore the possibility of a construction loan. However, due to the extent of completion, the lending institutions decided not to make any construction loans. On or about May 27, 1996, Watkins moved to Florida with the expectations that his home would be completed within a short period of time. (Watkins' recollection was that the home was to be completed in a couple of weeks. Respondent's recollection was that the home was to be completed in a couple of months.) In any event, Respondent did not complete the Watkins home within a couple of weeks or a couple of months. After Watkins moved to Florida, Respondent paid for Watkins to live in a Best Western motel for a few weeks. Subsequently, Respondent moved Watkins into a rental home for which Respondent paid the rent through September 1996. Beginning October 1996 through July 1999, Watkins paid $600.00 per month for a total of $20,400.00 as rent on the rental home. In early 1998, Respondent and Watkins went through the home, identified those items which had not been completed and Respondent made a handwritten list of those items. Respondent failed to complete the items identified on the list. In fact, shortly thereafter, Respondent ceased working on the project and was unresponsive to attempts to contact him. At the time Respondent ceased working on Watkins' home, the home was approximately 75 percent complete. While this estimation of completion may not be totally accurate, it is the best that could be derived based on the evidence presented, including Respondent's testimony to which I gave some credence. Watkins paid Respondent $561,617.91, which represents approximately 97.534 percent of the total contract price plus addenda to the contract. Seventy-five percent of the contract price plus addenda to the contract equals $431,863.82 for an overpayment of $129,754.09. To date, Respondent has not returned any of the money he received from Watkins above the amount completed under the contract. From early 1998, until August 1998, when Watkins had Respondent removed as general contractor on the building permit, Respondent failed to perform any work on the home for a period in excess of 90 days. Respondent contracted with Jack Eggleston to install cabinets in Watkins home. Eggleston performed under the contract but Respondent failed to pay Eggleston in full, requiring Watkins to pay Eggleston $1,200.00. After Watkins' home was partially complete, Respondent advised Watkins that he had the home insured when in fact he did not have the home covered with insurance. While Respondent was building Watkins' home, Respondent and Watkins entered into a joint venture called Contractors of Central Florida to build modular homes sometime after January 1, 1995. Respondent contends that some of the checks Watkins claims as payment under the contract for his home, were in fact reimbursement to Respondent for funds he had advanced for the joint venture. There is insufficient evidence to establish facts to show that any of the checks Watkins claims as payment under the contract for his home were in fact reimbursement for funds advanced by Respondent for the joint venture. Up until the time of the final hearing, the Department had incurred costs for the investigation and prosecution of this matter, excluding costs associated with an attorney's time, in the amount of $1,451.28.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, and after careful review of the guidelines set forth in Rule 61G4-17.001(8) and (11), Florida Administrative Code, and the circumstances for purpose of mitigation or aggravation of penalty set forth in Rule 61G4-17.002, Florida Administrative Code, it is recommended that the Department: Enter a final order finding Respondent guilty of violating Section 489.129(1)(h)2., Florida Statutes, and imposing a penalty therefor an administrative fine in the amount of $1,000.00; Enter a final order finding Respondent guilty of violating Section 489.129(1)(k), Florida Statutes, and imposing a penalty therefor an administrative fine in the amount of $1000.00; Assessing costs of investigation and prosecution, excluding costs associated with an attorney's time, in the amount of $1,451.28, plus any such further costs which have or may accrue through the taking of final agency action and; Requiring Respondent to pay restitution to Kevin Watkins in the amount of $129,754.09 which represents the amounts accepted by Respondent for work not performed. DONE AND ENTERED this 23rd of October, 2000, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6947 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 23rd day of October, 2000. COPIES FURNISHED: Robert A. Crabill, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32388-2202 Ronald J. Powell Post Office Box 7043 Indian Lake Estates, Florida 33855 Rodney Hurst, Executive Director Construction Industry Licensing Board 7960 Arlington Expressway, Suite 300 Jacksonville, Florida 32211-7467 Barbara D. Auger, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue The issues for determination in this case are whether Petitioner has standing to bring this action and, if so, whether Respondent Stuart Yacht Corporation is entitled to the General Permit which the Department of Environmental Protection (Department) intends to issue.
Findings Of Fact Petitioner owns Lot 4 in St. Lucie Settlement, a subdivision in Stuart, Florida. The subdivision has one border along the South Fork of the St. Lucie River. The subdivision has a finger fill that extends to the South Fork with canals on both sides. There are four lots on the finger fill, Lots 1 through 4 of the subdivision. Lot 4 is farthest from the river. On the north side of Petitioner’s property he has a dock where he keeps a boat. The dispute in this case involves the canal on the south side of Petitioner’s property. All references to “the canal” hereafter, unless otherwise noted, will be to the canal on the south side of Lot 4. Between Lots 2, 3, and 4 and the canal is a road which provides access to the lots on the finger fill. Between the road and the canal is a narrow strip of land. Petitioner owns this narrow strip of land where it corresponds with his lot lines. In other words, the southern boundary of his Lot 4 abuts the canal. However, because the canal is artificial, having been created by dredging, Petitioner has no riparian rights associated with the canal. That was the holding of the circuit court for Martin County in the litigation between Stuart Yacht Corporation and Petitioner. It was also established in the circuit court litigation that St. Lucie Settlement, Inc., which is the homeowner's association for the subdivision, owns the northern half of the canal and Stuart Yacht Corporation owns the southern half of the canal. No subdivision documents were presented to show the extent of rights granted to homeowners within St. Lucie Settlement related to the construction of docks or other uses of water bottoms that are included within the subdivision. Petitioner testified that he terminated his membership in the homeowners association three-and-a-half years ago. Stuart Yacht Corporation owns and operates a marina on the south side of the canal which includes docks over the water. At some point in the past, but before Petitioner purchased Lot 4 in 1995, Stuart Yacht Corporation constructed a dock along the north side of the canal, over the water bottom owned by St. Lucie Settlement, Inc. The dock along the north side of the canal has been used for mooring large yachts. The portion of the dock that ran along the boundary of Lot 4 was recently removed by Stuart Yacht Corporation following the rulings in the circuit court. The balance of the dock along the north side of the canal would be removed as a part of the proposed permit that Petitioner has challenged. In addition to removing the dock along the north side of the canal, the proposed permit authorizes Stuart Yacht Corporation to construct a new dock that is four feet wide and runs 150 feet along the property boundary in the center of the canal. No part of the proposed new dock would be on the property of St. Lucie Settlement, Inc. St. Lucie Settlement, Inc., did not challenge the proposed permit. In his petition for hearing, Petitioner alleged that the proposed new dock would cause the following injuries to his interests: interference with ingress and egress to Petitioner’s shoreline; interference with Petitioner’s desire to obtain a permit in the future to construct a dock or to “harden” the southern shoreline; and interference with Petitioner’s riparian rights. Petitioner’s testimony about his past use of the canal was inconsistent. He said he moored his boat in the canal once in 1995. He said he boated into the canal to fish on several occasions. He said that (at least twice) when he attempted to enter the canal by boat, he was denied access by representatives of Stuart Yacht Corporation. However, in a deposition taken before the hearing, Petitioner said he had never attempted to use the canal. The only testimony presented by Petitioner to support his claim that the proposed permit would interfere with his navigation, fishing, and desire to obtain a dock permit in the canal was the following: I couldn’t get a boat in there with that proposed dock in the center line of the canal right on their side of the canal. It would be 150 feet long. It would be a huge Wall of China. My neighbor and I couldn’t get to our shoreline. The evidence presented was insufficient to prove that Petitioner would be unable to navigate into the canal in a small boat or to fish in the canal if the proposed dock is constructed. The evidence was also insufficient to prove that Petitioner would be unable to construct any kind of dock for any kind of watercraft if the proposed dock is constructed.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department dismiss the petition for hearing based on Petitioner's failure to prove standing, and issue the proposed permit to Stuart Yacht Corporation. DONE AND ENTERED this 20th day of February, 2008, in Tallahassee, Leon County, Florida. S BRAM D. E. CANTER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 20th day of February, 2008. COPIES FURNISHED: Lea Crandall, Agency Clerk Department of Environmental Protection The Douglas Building, Mail Station 35 3900 Commonwealth Boulevard Tallahassee, Florida 32399-3000 Tom Beason, General Counsel Department of Environmental Protection The Douglas Building, Mail Station 35 3900 Commonwealth Boulevard Tallahassee, Florida 32399-3000 Michael W. Sole, Secretary Department of Environmental Protection The Douglas Building 3900 Commonwealth Boulevard Tallahassee, Florida 32399-3000 Paul B. Erickson, Esquire Alley, Maass, Rogers & Lindsay, P.A. 340 Royal Poinciana Way, Suite 321 Palm Beach, Florida 33480 Amanda Gayle Bush, Esquire Department of Environmental Protection Office of the General Counsel 3900 Commonwealth Boulevard, Mail Stop 35 Tallahassee, Florida 32399 Guy Bennett Rubin, Esquire Rubin & Rubin Post Office Box 395 Stuart, Florida 34995
Findings Of Fact At all times material hereto, Respondent, Ralph B. Snyder, Jr. ("Respondent"), was a licensed real estate broker having been issued license No. 0082998. Respondent was the qualifying broker for Home Hunters V, Inc., a corporate real estate broker having been issued license No. 0221795, with a principal business address of 2829 Okeechobee Boulevard, West Palm Beach, Florida. In September, 1981, Respondent registered Home Hunters V, Inc., as a real estate brokerage corporation, with himself as qualifying broker. The office remained open until April, 1982. Respondent was not present in the West Palm Beach office of Home Hunters V on a full-time basis because, in addition to that business, he was involved in a construction business on Sanibel Island, Florida. In late September or early October, 1981, Respondent hired Greg Howle to manage the Home Hunters V office in West Palm Beach. At all times material hereto, Howle was not registered as either a broker or salesman. Respondent's business, insofar as here pertinent, consisted of maintaining card files of rental properties available in the West Palm Beach area, and advertising availability of those properties for the owners. When a prospective tenant came to Respondent's office in response to advertisements or otherwise, those tenants would sign an agreement with Home Hunters V, Inc., and, after payment of a $60 fee, would be furnished information concerning available properties in the area that generally conformed to the types of properties prospective tenants were seeking. The standard procedure in Respondent's office was that the prospective tenants would first meet with Greg Howle, the office manager, who would have them execute the agreement with Home Hunters V, Inc., collect the $60 fee from them, and then refer prospective tenants to other office employees. Among these other office employees were Ilana Frank, a licensed real estate salesperson who began employment with Respondent in late September or early October, 1981, and Sheryl Kimball, an unlicensed employee, who was employed by Respondent on or about October 16, 1981, and continued as an employee until about November 29, 1981. Respondent testified that Ms. Kimball was hired as a receptionist and, in addition, performed general clerical responsibilities in the office, including greeting potential customers and referring them to licensed salespersons. The record in this cause establishes that Ms. Kimball did, on at least two occasions, speak with persons on the telephone concerning sales, and on both of those occasions she was reprimanded by Respondent for acting outside the scope of her employment. Ms. Kimball was never directed by Respondent to negotiate the rental of any real property nor does this record establish that Respondent knew of Ms. Kimball's engaging in any such activity. Respondent testified that Ms. Kimball was paid $150 per week for her services, and, in addition, was compensated for any overtime work she might have performed. Ms. Kimball testified, however, that she was paid $150 per week together with $3.00 for each contract she negotiated. However, Ms. Kimball could identify only one such contract on which she worked. With regard to that contract, which involved a customer named Paul Palmero, Respondent never received any funds, and the record in this cause does not reflect that any services were ever performed for Mr. Palmero. Further, the entire Palmero transaction was conducted in the presence of another of Respondent's employees, Ilana Frank, who, as indicated above, was a licensed salesperson. Accordingly, there is insufficient credible evidence of record in this cause to establish that Sheryl Kimball ever negotiated the rental of real property or interest therein; procured lessees of the real property of others; or performed any of the acts of a broker or salesman as alleged in the Administrative Complaint. Further, the record in this cause contains no evidence establishing the amounts actually paid to Ms. Kimball during the six-week period in which she was employed by Respondent. In reaching this conclusion, the Hearing Officer has taken into account the testimony and interests of both Ms. Kimball and Respondent in the outcome of this proceeding in attempting to reconcile the direct conflicts in their testimony. Ms. Kimball was discharged from Respondent's employ after having received two reprimands and having been accused of misappropriating funds. Thereafter, Ms. Kimball filed a complaint against Respondent with the Florida Real Estate Commission. Conversely, Respondent obviously has an interest in retaining his license as a broker. When viewed as a whole, it is concluded that facts of record in this cause with respect to Counts I and II are qualitatively and quantitatively insufficient to establish the factual allegations contained therein. Count III of the Administrative Complaint alleges that Respondent ". . . inserted or caused to be inserted fraudulent, false, deceptive or misleading advertisements in the Post and Evening Times newspaper of West Palm Beach, Florida." The same count further alleges that those advertisements were fraudulent, false, deceptive or misleading ". . . in that the content thereof stated to the public that respondents had available for lease through their firm various rental units at stated prices when in fact rental units of the advertised type were not available through their firm at the stated price." There is no evidence of record in this proceeding that would in any way establish the facts alleged in Count III of the Administrative Complaint. In fact, the only evidence of record on this issue is the testimony of Ms. Kimball that she observed Mr. Howle, the office manager, copying listings from Fort Myers newspapers for use in the West Palm Beach area. However, Ms. Kimball conceded that she did not know if any such ads were ever placed in the West Palm Beach newspaper. No such advertisements were introduced into evidence in this proceeding from which any comparison to any of the listings available through Respondents could be made to determine whether the ads were fraudulent, false, deceptive, or misleading. County IV of the Administrative Complaint charges the Respondent with having solicited and accepted money as advance rental fees with knowledge that rental units of the type and price desired by potential tenants were not available through Respondent's firm, and with making false representations as to the availability of rental units. Again, there is no evidence of record in this cause to establish a single, identifiable instance in which Respondent either individually or through its employees represented that rental units were available of a type and price that were not in fact so available.
The Issue Whether Respondent committed five violations of the Yacht and Ship Brokers' Act, including the following counts: 1) failing to have the license of each salesperson in his employ prominently displayed in his principal place of business; 2) failing to place deposits received from clients pursuant to transactions involving yachts into a broker's trust account; 3) allowing a person licensed only as a salesperson to act as a broker and to use the broker's name to evade the provisions of the Yacht and Ship Brokers' Act; 4) failing to deposit funds into the broker's trust account within three working days of receipt of funds pursuant to a purchase contract by a salesperson licensed under him; 5) allowing a salesperson licensed under him to carry out acts which if committed by the broker would place him in violation of the Yacht and Ship Brokers' Act and the rules thereunder, such as violating the Notary Public Law, failing to exercise due professional care in the performance of brokerage services, and making substantial and intentional misrepresentations with respect to transactions involving yachts, as alleged in the Amended Notice to Show Cause, in violation of the Yacht and Ship Brokers' Act, Chapter 326, Florida Statutes, and if so, what penalty should be assessed.
Findings Of Fact Petitioner is the agency of the State of Florida charged with the responsibility to administer and enforce the Florida Yacht and Ship Brokers' Act, Chapter 326, Florida Statutes. The purpose of the Yacht and Ship Brokers' Act is to protect the consumer. A yacht broker is an individual who, in expectation of compensation, sells used boats in excess of 32-feet in length for other persons. In order to obtain a license to act as a yacht broker, an individual must submit an application, undergo a background check for moral character, submit a surety bond, and demonstrate to the Division that he has a trust account to place funds received in pending yacht transactions. Before being able to independently perform yacht brokering services as a yacht broker, an individual must spend two consecutive years as a yacht salesperson in a mentorship working under a broker. At all times relevant to this action, Respondent held a license with Petitioner to operate as a yacht broker. Respondent continues to be licensed as a yacht broker. In late 1995 and early 1996, Respondent operated his yacht brokerage business, Greg and Associates, from two locations. His main office was located in Rockledge, Florida, and a branch office was located in Sarasota, Florida. No brokers were present at the Sarasota location. Respondent operated the Sarasota branch office from his main office in Rockledge, Florida. He never visited the Sarasota branch office. Respondent viewed his relationship to the Sarasota branch office as an "escrow agent." Bullock, a salesman, had complete autonomy to run the Sarasota branch office. Respondent met Bullock only once, and he never met any of the other salesmen who operated out of the branch office. Respondent had only a commission arrangement with Bullock. Respondent sent checks for all commissions to Bullock, who deposited them in Bullock's company, Friar Tuck, Inc's., Barnett Bank business account. Respondent allowed Bullock to hire the other salesmen, to determine a commission arrangement with the other salesmen, and to disburse commissions to the other salesmen. Respondent did not know the commission arrangement with most of the salesmen in the branch office. On April 16, 1996, Respondent was interviewed in his office about some complaints that had been received concerning the operation of his Sarasota branch office. Among the salesmen working under Respondent's broker's license in his Rockledge office at that time were Darrell Lawson and Mark Salmuller. Respondent did not have the licenses of either of these two salesmen displayed. Both men were listed as active employees by Respondent. At all times relevant to this proceeding, Respondent maintained a broker's trust account, entitled Greg and Associates, d/b/a Yacht Brokerage USA, in the Rockledge branch of the Barnett Bank. At all times relevant to this proceeding, Chester Bullock, a yacht salesperson working for Respondent in Respondent's Sarasota branch office, maintained a business checking account entitled Friar Tuck, Inc., d/b/a Yachtmasters, in a Sarasota branch of the Barnett Bank. Bullock was listed as president of the company and was identified as a signatory on the account. This was not a proper broker's trust account, as Bullock, being a yacht salesman, could not have established such an account. In July 1995, Chester Bullock and Jeff Webb, salesmen in the Sarasota branch office, took an offer and received a $1,000.00 deposit from David and Cynthia Cislo, on a 1979 34-foot Marine Trade Trawler. Respondent's salesmen did not deliver the deposit to Respondent's trust account within three days of its receipt. The funds were deposited in Bullock's business checking account at the Sarasota branch of the Barnett Bank. Sometime later, the money was redeposited in Respondent's trust account. Bullock notarized the vessel bill of sale at the time of the closing, and received a commission on the sale. In November 1995, Bullock took an offer and received a $5,350.00 deposit from a Louisiana client, Charles Cosgrove, on a 1964 38-foot Chris-Craft Commander yacht. Respondent's salesman did not deliver the deposit to Respondent's trust account within three days of its receipt. On November 27, 1995, Bullock and Jeff Webber, Respondent's salespeople, acted as listing broker and salesperson, respectively, on the lease-purchase of the 1964 38-foot Christ Craft Commander by Cosgrove. Respondent never signed the brokerage sales record, which is the closing statement given to the lease-purchaser, Cosgrove, and was never identified as broker of record on any of the sales documents. Instead, the purchase-sale agreement lists Bullock as the broker, and the closing statement lists Bullock as the broker. Bullock acted as the notary public for the lease-purchase agreement. In January 1996, Bullock and Harold Raines, yacht salesmen in the Sarasota branch office, took an offer and received a $1,700.00 deposit from a client, Michael Hill, on a 1973, 53-foot Huckins yacht. The letterhead of the draft purchase and sales agreement, which stated "Yachtmasters" and a phone number for the Sarasota area, further indicated that Hill's offer was made through yacht salesmen at the Sarasota branch office. Respondent's salesmen did not deliver the $1,700.00 deposit to Respondent's trust account within three days of its receipt. Instead of delivering the $1,700.00 deposit to Respondent for deposit in Respondent's Rockledge broker's trust account, the check was delivered to Friar Tuck, Inc's., Sarasota account. Hill's deposit, which was supposed to be held in a trust account, intermingled with the other business funds of Bullock's account. Hill requested and received an oral extension from Bullock on his closing date to purchase the yacht. About a month later, Bullock notified Hill that the yacht was sold to another party. It was only after Hill threatened to sue Respondent, the responsible broker, and after Hill filed a complaint with Petitioner that Respondent refunded Hill his deposit. The Yacht and Ship Brokers' Act does not permit licensed salespeople to perform certain acts. It requires the employing broker to do them. An employing broker, a broker who holds the license of his salesperson, must make all trust account deposits and withdrawals of monies involved in a transaction brokered by the salesman. An employing broker is required to supervise the yacht transactions brokered by his salespeople and to sign closing statements, which itemize all charges and credits of the transaction for the client. Respondent minimized his own involvement in his Sarasota branch office and permitted his salesman, Bullock, to operate it. This enabled Bullock to sign as the broker a closing statement of the sale of a yacht, which is an action that should have been performed only by a broker. During the same time period that Respondent granted Bullock autonomy to supervise the Sarasota branch office, Bullock operated another business from the same location, Sarasota Marine and Maintenance Services, which did boat surveys and cleaned boats. Bullock was the president of Sarasota Marine and Maintenance Services. In early 1996, Wittman, a Colorado resident at that time, telephoned Bullock about the 1988, 34-foot Wellcraft Grandsport in the magazine advertisement placed by Bullock. Bullock sent Wittman a videotape of the yacht. After reviewing the videotape, Wittman did not think that it was the same yacht advertised in the magazine. Bullock admitted that the yacht in the videotape was not the same yacht advertised in the magazine, but claimed that it was a sister ship. Based upon Bullock's assurances that the sister yacht was in good condition and the results of a survey done by Bullock's company stating that the yacht was in good condition, Wittman purchased the yacht. Bullock acted as both the listing broker and the selling broker in the sale of the 1988, 34-foot Wellcraft Grandsport yacht to Boyd Wittman, the purchaser. Notwithstandng the fact that he was representing the seller, Bullock did not obtain the written consent of Wittman, the purchaser. Wittman wanted a registered surveyor to do a survey of the condition of the yacht, because Wittman lived out-of-state and wanted to avoid spending money to fly to Florida to inspect it. Bullock arranged for his own company, Sarasota Marine and Maintenance Services, to perform the survey. The survey was signed by Ernest Shaffer, who was identified as a Certified Marine Surveyor and Consultant with the Society of Accredited Marine Surveyors, the National Association of Marine Surveyors, and the National Marine Investigators. Ernest Shaffer was someone that Bullock hired to wash boats. He was not a certified surveyor, as he was held to be. When the yacht was delivered to Wittman in Colorado, he was shocked by the poor condition of the yacht. The interior, the cockpit, the exterior, the bilge, and the mufflers were all in poor condition. Wittman was expecting a yacht that he could take someone out on a lake with, and it was not in good enough condition. Wittman had to pay another $15,000 to $20,000 to repair the yacht to improve it to good condition. Repairs included replacing all of the interior of the cabin, replacing the port windshield, putting new mufflers in, fixing a transmission leak, fixing the air-conditioning, rebuilding the water pumps so that the engines cooled properly, and replacing the dry-rot wood on the main deck on the cockpit. In sum, Wittman purchased the yacht for $38,000, spent another $15,000 to $20,000 in repairs, and eventually sold it for $37,000. Bullock also quoted to Wittman a fee for shipping the yacht from Florida to Colorado for $1,500. Wittman thought the price was reasonable. When the yacht was finally shipped, it cost Wittman approximately $3,800, which he paid, because he had already bought the yacht and had to finish the transaction. Bullock acted as both the listing broker and the selling broker in the sale of a 1973, 34-foot Nautiline yacht to Ernest C. Shaffer, the purchaser. Bullock arranged for his company, Sarasota Marine and Maintenance Services, to perform the survey. The survey was signed by Ted Williams, who was identified as a Certified Marine Surveyor and Consultant with the Society of Accredited Marine Surveyors (SAMS), the National Association of Marine Surveyors (NAMS), and the National Marine Investigators. Neither Bullock, Ernest Shaffer, nor Ted Williams, his employees who signed the surveys of the yachts described above, was certified with NAMS or SAMS, two marine surveys accreditation associations. In the case of a 1973, 53-foot Huckins yacht, Bullock tried to sell the boat three times and took three simultaneous contacts on the same vessel. He took a contract from Michael Hill, a prospective purchaser, extended the closing date for Hill to March 6, 1996, and simultaneously had contracts for the same boat with the prospective purchasers Sam Bankester and Steven Kenneally, with the closing dates of February 29, 1996, and March 2, 1996, respectively. Ultimately, Steven Kenneally purchased the yacht. The terms of the contracts did not provide for simultaneous contracts on the same vessel. The prospective purchaser who did not come up with the money first lost out on the opportunity to purchase the yacht. In addition, the Hills, the prospective purchasers, had a difficult time obtaining their earnest money back from Bullock. In January of 1996, Raines, Respondent's salesman, showed Chris June, a North Carolina resident, a 1970, 42-foot Trojan Sea Voyager yacht named "Fantasia." June liked the 42- foot Trojan Sea Voyager and entered into a contract to purchase it through Raines and Bullock. Bullock recommended a surveyor, John Pomeroy, in St. Petersburg, Florida, to complete the survey. Pomeroy was, in fact, not certified with NAMS or SAMS. Bullock told June that the boat was in very good condition and that it was a great value. During the survey, June noticed that wood on the yacht was separating in the bow, and asked Bullock and Pomeroy about it. They explained that this was "wet/dry expansion" which occurs in yachts that sit for a long time and can easily be fixed with some screws and caulking. "Wet/dry expansion" causes wood in wooden yachts to start separating, according to Bullock and Pomeroy, due to the wet wood below the waterline and the dry wood above the waterline. The survey disclosed no substantial problems with the yacht. Relying on the statements of Bullock and Pomeroy, June purchased the "Fantasia" for $22,000, with money loaned to him by a relative. A month after purchasing his yacht, June was informed that his boat was sinking while moored at the dock. June had to hire a marine recovery company to recover the yacht, just before it was about to go completely under water. The yacht took on water in an area near the stern that was not well checked-out, where a basketball-sized wad of putty holding the corner together came loose. As the estimate to repair the boat was more than three times what the boat was worth, June sold it to a salvage yard for $2,500. However, the salvage yard defaulted on that payment. June has been making accelerated payments on his loan, and has the loan down to approximately $19,000. He made a claim against Respondent's surety bond and settled the action for a small amount from the bonding company. Respondent attended two all-day workshops hosted by the Petitioner's Section of General Regulation, which cover in detail how to display a license, to display trust accounts, to display broker's duties and responsibilities, and to display branch offices. Respondent was exposed to the statutes and rules which were violated. Respondent took a cavalier attitude towards following the requirements of the Act. On February 15, 1996, Petitioner entered a Final Order against Respondent in Docket No. YS95397, imposing a fine of $1,500 for Respondent's violation of the Act. Respondent used the name "Yachtmasters" for his Sarasota branch office without having a license issued in that name in violation of Florida law. In the case DBPR v. Chester C. Bullock, Docket No. YS97172 (December 11, 1998), the Petitioner charged Chester Bullock, a registered salesman, with five violations: Charge 1 - The Respondent acted as a broker when he was licensed only as a salesman. Charge 2 - The Respondent made substantial and intentional misrepresentations with respect to transactions involving yachts upon which people have relied. Charge 3 - The Respondent violated other laws governing transactions involving yachts, specifically, he violated Chapter 117, Florida Statutes, by notarizing signatures on documents in which he had a financial interest. Charge 4 - The Respondent failed to immediately deliver deposits received from clients for the purchase of yachts to the broker under whom he was licensed as a salesman. Charge 5 - The Respondent failed to exercise due professional care in the performance of brokerage services, such as recommending his own company as a surveyor to a client and representing it as being an accredited surveyor company, when it was not. Bullock was found guilty on all charges and assessed a civil penalty of $45,000 in that case and had his yacht salesperson's license revoked. The Petitioner has proven each of the violations by clear and convincing evidence. Respondent's explanations for his conduct is not credible.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Division of Florida Land Sales, Condominiums and Mobile Homes enter a final order which: Finds Respondent guilty of the charges set forth in Counts 1, 2, 3, 4 and 5 of the Amended Notice to Show Cause. Respondent's broker's license is hereby revoked. The Division impose a civil penalty of $40,500, which is $500 for Count 1 and $10,000 each for Count 2, 3, 4, and 5. The Respondent shall immediately cease and desist from any violations of Chapter 326, Florida Statutes, and the administrative rules promulgated thereunder. DONE AND ENTERED this 18th day of June, 1999, in Tallahassee, Leon County, Florida. DANIEL M. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 18th day of June, 1999. COPIES FURNISHED: William Oglo, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1007 Gregory Linnemeyer 613 Rockledge Drive Rockledge, Florida 32955 Philip Nowick, Director Division of Florida Land Sales, Condominiums, Mobile Homes Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399 William Woodyard, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399
Findings Of Fact Petitioner is the state agency charged with the responsibility to prosecute administrative complaints pursuant to Chapters 489, 455, and 120, Florida Statutes, and the rules promulgated pursuant thereto. At all times material to the Administrative Complaint, Respondent James J. Hastings was licensed as a certified general contractor in the State of Florida, holding license number CG C009847. At all times material hereto, Respondent was a qualifying agent for Hastings Construction Company, Inc. Respondent and Candace Reinertz are married. At all times material to the violations charged, she was operating under her maiden name for all purposes. At all times material hereto, Candace Reinertz was not licensed by the Florida Construction Industry Licensing Board, and the Respondent had knowledge thereof. Over several years, Ms. Reinertz regularly assisted Mr. Hastings in the operation of Hastings Construction Company, Inc., including day to day supervision of pool, small building, and house construction and pulling building permits for that corporation. She had been authorized in writing by Hastings to pull building permits for him on specific projects (not necessarily in a corporate name) at least since April 27, 1987. At all times material hereto, Castles `n' Pools, Inc., 205 Third Avenue, Melbourne Beach, Florida, was a firm that was not qualified with the Construction Industry Licensing Board, and Respondent had knowledge thereof. This corporation was intended to become a venture to be run jointly by husband and wife. Castles `n' Pools, Inc. had been qualified as a corporation with the Florida Secretary of State and had received an occupational license. The corporate officers/directors were Reinertz and Hastings. However, a Florida Construction Industry Licensing Board License was never applied for by Ms. Reinertz in her own name nor was one applied for by Mr. Hastings as a qualifier for Castles `n' Pools, Inc. On June 27, 1987, Castles `n' Pools, Inc., through Candace Reinertz, contracted with Zimmer Dominque for construction of a pool at Mr. Dominque's residence located at 866 Van Circle, N.E., Palm Bay, Florida, for $7,750. The contract promised completion of the pool by September 23, 1987, barring adverse weather and mishaps. It is Ms. Reinertz's testimony that she inadvertently filled in a Castles `n' Pools, Inc. blank contract when she intended to use a Hastings Construction Company blank contract. The blank forms are, indeed, very similar. Mr. Dominque's testimony is that he thought at all times that he was contracting with Castles `n' Pools, Inc., through Ms. Reinertz. Although he admits that at least by September 22, 1988, he considered Respondent in charge of the project and that he thereafter dealt directly with Respondent, Mr. Dominque's payment by checks made out to Castles `n' Pools and/or Candace Reinertz dated June 27, July 7, September 22, and September 24, 1987 (P-10) support a finding that all work to that point was progressing in the name of Castles `n' Pools. Also supportive of such a finding is that on July 6, 1987, Pyramid Equipment Service billed Castles `n' Pools for digging the hole for the pool (R-8) and on August 11, 1987, R & J Crane Service billed Castles `n' Pools for setting the pool in place (R-9). However, the issuance of the building permit to Hastings Construction Company, Inc. and the chronology of how the permit came to be issued (see infra.) suggest that Mr. Hastings did not know about the Castles `n' Pools connection until at least late September. Respondent's and Ms. Reinertz' testimony that Respondent did not find out that the wrong contract had been used until after construction was underway on the Dominque property is unrefuted and the exact date of his discovery was not demonstrated, but he admits he did not attempt to qualify Castles `n' Pools once he found out. On June 29, 1987, the Respondent authorized Candace Reinertz to pull a permit for the construction of a pool at Mr. Dominque's residence. The authorization, (P-12), does not specify either Castles `n' Pools nor Hastings Construction Company, Inc. as the construction corporation applicant. Ms. Reinertz's subsequent permit application was denied on July 2, 1987, by the Palm Bay Building Department, for failure to include a survey certified by a civil engineer or architect. The record does not reflect in what corporate name Ms. Reinertz made this initial application. She may not even have gotten as far as filling out a permit application before she was refused at the permit desk, but the line drawing prepared for that application (R-1) specifies that the line drawing was that of Hastings Construction Company, Inc. Mr. Hastings regularly did line drawings for Hastings Construction Company, Inc. projects on a particular machine in that corporation's offices. The certified survey requirement was a recent innovation of the Palm Bay Building Code. On July 6, 1987, Castles `n' Pools, Inc. delivered the prefabricated fiberglass pool, excavated the site and dropped the pool in the hole. No further efforts of permanent installation occurred at that time, due to failure to obtain a permit. A dispute then ensued between Hastings and Reinertz on one side and Mr. Dominque on the other over who must provide the survey and how. This dispute occasioned some delay in the project, but on July 26, 1987, Ms. Reinertz again applied, with a certified survey, to the Palm Bay Building Department for a permit for the construction of Mr. Dominque's pool, listing the builder as Hastings Construction Company, Inc. (P-5). On July 30, 1987, permit number 8702101 was issued by the Palm Bay Building Department for the construction of Mr. Dominque's pool by Hastings Construction Company, Inc. (P-6). Thereafter, work on the pool progressed sporadically until September 22, 1987, when the pool floated up out of the ground. The pool floated up out of the ground during a rainstorm and after Respondent had left Mr. Dominque with instructions to fill the pool to a certain level with water. There is sufficient evidence to demonstrate that Mr. Dominque failed to follow Respondent's directions with precision. Subsequent to September 22, 1987, the pool was reinserted in the excavation by crane and by October 2, 1987, the deck was installed. Two or three months later a crack appeared in the pool which has since been repaired, however, the drain and light still do not work properly, and Mr. Dominque had to pay an additional $50 for cleanup of the resulting debris. Some of the delay in completion of work on the pool can be attributed to the dispute about the survey, some to injury of a key employee, and some to heavy rains, but the testimony of Mr. Nasrallah, architect and expert contractor, is accepted that 30 to 45 days would be sufficient to install the entire pool except for the pool deck even in rainy weather. Also, Mr. Dominque's and Respondent's testimony is in agreement that Respondent (not Ms. Reinertz) was fired for a period of time and then rehired. The length of time and the dates that Respondent was off the job is unclear, but it was minimally from September 9 to September 22, 1987. Oversight of the work at all times was by the Respondent. Mr. Dominque has paid the total contract price of $7,750 and expressed himself that any amount he questioned has either "evened out" or been paid back by Respondent. Stan Alexander is a certified general contractor and former chairman of the Florida Construction Industry Licensing Board. In his expert opinion as a contractor, construction began when the hole was first dug on July 6, 1987 and the pool was placed in it even temporarily. Also in his expert opinion as a contractor, Mr. Alexander determined that the contractor responsible for the installation of this pool was guilty of gross negligence or incompetence due in part to the insufficiency of dewatering devices (including a hydrostatic device) and placement of the responsibility to fill the pool on the home owner. Mark Nasrallah is a registered Florida architect and a licensed general contractor. Also in his expert opinion as a contractor, construction began on the job when the pool was placed in the excavation. It is also Mr. Nasrallah's expert opinion that the contractor responsible for this job is guilty of gross negligence or incompetence. Although Mr. Alexander was unfamiliar with any local Palm Bay zoning or permitting provision which would allow "site clearing" prior to excavation/construction, and although Mr. Nasrallah considered it "questionable" whether the digging for the pool constituted "construction without a permit," Mr. Nasrallah's assessment that digging the hole and putting the pool in the hole even temporarily was in excess of mere site clearing and was work which clearly began construction is accepted. Section 103 of the Standard Building Code has been adopted by the City of Palm Bay. It provides as follows: A person, firm or corporation shall not erect, construct, enlarge, alter, repair, move, improve, remove, convert, or demolish any building or structure in the applicable jurisdiction, or cause the same to be done, without first obtaining a building permit for such building or structure from the Building Official. Respondent was disciplined by the Construction Industry Licensing Board in October, 1984, for violation of Sections 489.129(1)(c), (g), (j); 489.119(2), (3); and 455.227(1)(a) Florida Statutes.
Recommendation Upon the foregoing findings of fact and conclusions of law, it is recommended that the Construction Industry Licensing Board enter a final order finding Respondent guilty of violations of Sections 489.129 (1)(d) and (m) Florida Statutes, issuing a letter of guidance with regard to the permitting violation, fining the Respondent $750.00 for gross negligence or incompetence, and dismissing the remaining two charges. DONE and RECOMMENDED this 23rd day of November, 1988, at Tallahassee, Florida. ELLA JANE P. DAVIS, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of November, 1988. APPENDIX TO RECOMMENDED ORDER DOAH Case No. 87-5172 The following constitute rulings pursuant to s. 120.59(2), Florida Statutes, upon the parties' respective Proposed Findings of fact (FOF). Petitioner PFOF: Accepted in FOF 1. Accepted in FOF 2. Accepted in FOF 3. Accepted in FOF 5. Accepted in FOF 7. Accepted in FOF 8. 7-8. Accepted and expanded to more accurately reflect the record in FOF 10 9. Accepted in FOF 11. 10-11. Accepted and expanded to more accurately reflect the record in FOF 12. Accepted and expanded to more accurately reflect the record in FOF 13. Accepted in FOF 14. 14-15. Accepted in part and rejected in part in FOF 15-17. The modifications are made to more accurately reflect the record as a whole, the specific expert opinion as given by Messrs. Alexander and Nasrallah (discussed in the Conclusions of Law) and to reflect that some hydrostatic devices were used, some removed, and at least one left in for a period of time. 16. Accepted in FOF 19. COPIES FURNISHED: Fred Seely, Executive Director Construction Industry Licensing Board Department of Professional Regulation Post Office Box 2 Jacksonville, Florida 32201 G. W. Harrell, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 James J. Hastings 205 Third Avenue Melbourne Beach, Florida 32951 Lawrence A. Gonzalez, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Bruce D. Lamb, General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 =================================================================
The Issue On February 28, 1996, the Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes (Petitioner) issued a Notice To Show Cause to Robert O'Brien (O'Brien) alleging that O'Brien violated Section 326.006(2)(e)7, Florida Statutes. Specifically, O'Brien was charged with allowing an unlicensed person to attempt to sell a 52' Hatteras known as "Watermellon" on behalf of O'Brien Yacht Sales. The issue is whether this violation occurred and, if so, what penalty is appropriate. On May 15, 1996, the Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes (Petitioner) issued an Amended Notice To Show Cause to David Sandmann (Sandmann) alleging that Sandmann violated Section 326.004(1), Florida Statutes. Specifically, Sandmann was charged with offering or negotiating to sell a 52' Hatteras, known as "Watermellon". The issue is whether this violation occurred and, if so, what penalty is appropriate. RULINGS ON PETITIONER'S EXCEPTIONS TO ADMINISTRATIVE LAW JUDGE'S FINDINGS OF FACT Petitioner filed an exception to the Administrative Law Judge's Finding of Fact number 15. Section 120.57(1)(j), Florida Statutes, states that: The agency may not reject or modify the findings of fact unless the agency first determines from a review of the entire record, and states with particularity in the order, that the findings of fact were not based upon competent substantial evidence. A thorough review of the record has been made. The Division adopts and incorporates by reference the first sentence of the Administrative Law Judge's Finding of Fact number 15. Petitioner's exceptions to the remainder of Finding of Fact number 15 are accepted because the remainder of the Administrative Law Judge's Finding of Fact number 15 is not supported by competent substantial evidence. The second sentence, "The conflict as to whether Respondent Sandmann's acts, considered collectively, establish that he was attempting to sell the boat is resolved by finding that he was not attempting to sell the boat." is rejected because, the Petitioner presented testimony which proved that Sandmann: offered "to help" the Division investigators when they approached the boat. (T. 20, 38-39). gave the Division investigators a business card with his name and O'Brien Yacht Sales, Inc. written on it. (T. 19, 38-19, 52)( P's Exh. 2) gave the Division investigators a spec sheet containing information about the boat. (T. 21, 32, 39, 52). (P's Exh. 3). told the Division investigators that the price of the boat was negotiable. (T 22, 29-30, 39-40, 52). told the Division investigators that the commission would be paid by the seller. (T 21, 22, 29-30, 32, 34, 40, 43) had a copy of a blank sales contract faxed to him (from O'Brien Yacht Sales, Inc.) at the boat show. (T. 22- 23, 41, 52) Also at Recommended Order, page 5, paragraphs 9, 10, 11 and 12. Additionally, there was no competent substantial evidence to support the Hearing Officer's Finding of Fact that Respondent Sandmann was not offering or negotiating to sell the boat, because these actions were uncontroverted. Respondent Sandmann never denied that he was offering or negotiating to sell the boat. Furthermore, the sentence in question is not a Finding of Fact, but rather a Conclusion of Law. The Administrative Law Judge's characterization of this as a Finding of Fact, does not make it so. In Hernicz v. State Dept. of Professional Reg., 390 So.2d 194 (Fla. 1st DCA 1980), facts were undisputed that a nurse practitioner had done certain acts, and when the Board concluded that the actions were a violation of the statute, the court held that that amounted to a Conclusion of Law and not a Finding of Fact. The "facts" were the individual actions that were taken by the Respondent, whether these acts violated the statute was a Conclusion of Law. As stated above, the acts, themselves, in this case were neither denied nor disputed. The second sentence in Finding of Fact number 15 is stricken in its entirety. The third sentence in Finding of Fact number 15 states that "[I]t is clear that Respondent Sandmann was at no time acting as an employee of Mr. Mellon or Respondent O'Brien or with the expectation of receiving compensation for his acts". The "expectation of receiving compensation" was the argument relied on by the Respondents at hearing as their defense to participating in the boat show. Because "compensation" is an integral part of Chapter 326, Florida Statutes, its interpretation should be left to the expertise of the agency. It is a well settled principle that the interpretation of a statute by the agency responsible for its enforcement is entitled to great weight, and will not be overturned unless clearly erroneous. Department of Environmental Regulation v. Goldring, 477 So.2d 532 (Fla. 1985); Shell Harbor Grou, Inc. v. Department of Business Regulation, 487 So.2d 1141 (Fla. 1st DCA 1986). The Division believes that "compensation" can be other than a monetary commission, as claimed by Respondents. "Compensation" can be "perks" such as transportation or use of a house or yacht, or something intangible, such as friendship and affection. The existence of a quid pro quo is what is looked for. Furthermore, from a thorough reading of the record, it was proven by substantial competent evidence that a commission was anticipated being paid, because Petitioner's investigators were told that "the commission would be paid by the seller". (T 21, 22, 29-30, 32, 34, 40, 43). Possibly, no monetary commission was paid to Sandmann, because the yacht did not sell. Regardless, the Division finds that the friendship between Mr. Mellon and Sandmann was adequate compensation under Chapter 326, Florida Statutes. The third sentence of Finding of Fact number 15 is stricken in its entirety. The fourth sentence, "Respondent Sandmann was at the Boat Show and on the `Watermellon' solely as a friend of Mr. Mellon, the owner", is also rejected. The Division does not dispute the long standing friendship of Respondent Sandmann and Mr. Mellon, however being someone's "friend", does not exempt them from Chapter 326, Florida Statutes. There was uncontroverted testimony that Respondent Sandmann was offering or negotiating to sell the boat. That is all that is necessary for him to be within the jurisdiction of the Division, and require him to have a license. Although his friendship could be his motivation or compensation for being on the yacht, his actions, while there, show that he was offering or negotiating to sell the "Watermellon". The fourth sentence of Finding of Fact Number 15 is stricken in its entirety. RULINGS ON PETITIONER'S EXCEPTION TO ADMINISTRATIVE LAW JUDGE'S CONCLUSIONS OF LAW Petitioner filed an Exception to Conclusion of Law number 23 contained in the Recommended Order. This conclusion stated that the Petitioner had failed to meet its burden as to Sandmann because it failed to establish that he was attempting to sell the yacht, and, if the case against Sandmann failed, then the case against O'Brien failed. The Division rejects this Conclusion of Law because it believes that Petitioner proved by substantial competent evidence that Sandmann was offering or negotiating to sell the "Watermellon", and that friendship is adequate compensation.
Findings Of Fact Petitioner is the agency of the State of Florida that administers and enforces the Florida Yacht and Ship Brokers' Act, Chapter 326, Florida Statutes. At all times pertinent to this proceeding, Respondent O'Brien has been licensed as a Yacht and Ship Broker pursuant to the provisions of Chapter 326, Florida Statutes. Respondent O'Brien owns and operates O'Brien Yacht Sales. Respondent O'Brien resides in and has his principal place of business in Palm Beach County, Florida. Mr. Sandmann is a resident of Essex, Connecticut. He has never been licensed as a yacht salesman or as a yacht broker. Mr. Sandmann makes his livelihood as the owner of a dog collar manufacturing business. Henry Mellon, the boat's owner, held a salesman's license issued by Petitioner that expired in August 1994. At the times pertinent to this proceeding, Mr. Mellon was not licensed by the Petitioner. Respondent Sandmann, Respondent O'Brien, and Mr. Mellon have been close friends for many years. Mr. Mellon formerly worked for O'Brien Yacht Sales. Mr. Mellon and Respondent Sandmann are old friends from college. The Fort Lauderdale International Boat Show permitted only new yachts or brokered yachts. Individuals were not supposed to sell boats in this show. Respondent O'Brien was aware of this restriction. In October 1995, Respondent O'Brien had the boat "Watermellon" displayed and listed for sale at the 36th Annual Fort Lauderdale International Boat Show. The asking price for the sale of the Watermellon was $425,000. Mr. Mellon is neither an officer or a director of O'Brien Yacht Sales. Mr. Mellon signed a form styled "Application and Contract for Exhibit Space" so that the Watermellon could be exhibited at the boat show and on this application represented that he was a vice president of O'Brien Yacht Sales. Neither Respondent O'Brien or his company paid to put the Watermellon in the Boat Show and neither expected to receive any commission from the sale of the Watermellon. Respondent O'Brien was acting out of friendship with Mr. Mellon. 1/ On October 27, 1995, Peter Butler and Robert Badger, in their official capacities as employees of the Petitioner, attended the Boat Show and went to the Watermellon. They observed a sign on the back of the boat that advised that the boat was being offered by O'Brien Yacht Sales and gave its telephone number. Mr. Butler and Mr. Badger approached the boat and asked a person, later identified as Respondent Sandmann, whether Respondent O'Brien was aboard. Respondent Sandmann told Mr. Butler and Mr. Badger that Respondent O'Brien was not aboard, asked if he could help them, and gave them a business card with his name and the name of O'Brien Yacht Sales on it. No licensed salesman was on board at this time, but Mr. Mellon, the owner of the boat, was aboard. 2/ Respondent Sandmann gave Mr. Butler and Mr. Badger a copy of a printed sheet containing basic information about the Watermellon. This sheet, referred to as a spec sheet, contained errors that Respondent Sandmann verbally corrected when he gave them the sheet. In response to questions, Respondent Sandmann told Mr. Butler and Mr. Badger that the price of the boat was negotiable and that the commission would be paid by the seller. Mr. Butler and Mr. Badger asked Respondent Sandmann if they could see a copy of the contract that a buyer would need to sign if he purchased the boat. In response, Respondent Sandmann contacted the O'Brien Yacht Sales office and had someone fax to him a copy of the contract used by O'Brien. Respondent Sandmann then gave the form contract to Mr. Butler and Mr. Badger. The business card given by Respondent Sandmann to Mr. Butler and Mr. Badger was printed in 1994 when Respondent Sandmann, who is fluent in French, Spanish, and Italian, accompanied Mr. Mellon to a boat show in Europe. Mr. Butler and Mr. Badger did not inquire as to the amount of the commission that would have been paid by the seller of the Watermellon because Petitioner does not regulate commissions. None of Respondent Sandmann's acts, when considered individually, required a license from the Petitioner. 3/ The conflict as to whether Respondent Sandmann's acts, considered collectively, establish that he was attempting to sell the boat is resolved by finding that he was not attempting to sell the boat. It is clear that Respondent Sandmann was at no time acting as an employee of Mr. Mellon or Respondent O'Brien or with the expectation of receiving compensation for his acts. Respondent Sandmann was at the Boat Show and on the Watermellon solely as a friend of Mr. Mellon, the owner.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Petitioner enter a final order as to these consolidated cases that dismisses the charges filed against these respondents. DONE AND ENTERED this 27th day of August, 1996, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON, 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 27th day of August, 1996.
The Issue Whether Respondent violated Sections 326.006(2)(e)1, 3, and 6 and 326.005, Florida Statutes, and if so, what penalty should be imposed.
Findings Of Fact At all times material to this action, Respondent, Richard Spooner (Spooner), was licensed by the Petitioner, Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes (Department), as a yacht salesperson. In June 1998, Spooner worked for C & S Marine, Inc., (C & S), located in Fort Lauderdale, Florida. Chris Saumsiegle, the owner of C & S, was Spooner's employing broker. In June 1998, Chris Saumsiegle was working with Angelo Dieguez, a client from South Carolina, to locate a yacht for Mr. Dieguez to purchase. Mr. Saumsiegle negotiated the purchase of a yacht for Mr. Dieguez; however, the deal was not consummated. After Mr. Saumsiegle's attempt to negotiate the purchase of the yacht for Mr. Dieguez failed, Mr. Saumsiegle put Spooner, as a salesperson for C & S, in touch with Mr. Dieguez to find him a yacht to purchase. Spooner and Mr. Dieguez discussed the purchase of a 1995, 33-foot Sea Ray yacht, and Mr. Dieguez became interested in buying the vessel. Mr. Dieguez was advised by Spooner that he was working at home while his wife recovered from surgery. Spooner drafted a Purchase Agreement, which was a C & S form agreement containing the title "C & S Marine Brokerage Purchase Agreement." Spooner crossed out the telephone and fax numbers for C & S on the form, wrote in his home fax number, and faxed the document to Mr. Dieguez for execution. The purchaser agreement contained the following paragraph: The purchase price of the Vessel is Eighty- Seven Thousand Dollars ($87,000.--) Upon signing this agreement by the PURCHASER, a deposit of Eight Thousand Seven Hundred Dollars ($8,700.--) shall be paid by the PURCHASER to (hereinafter called the BROKER) and shall be held in Escrow by the BROKER. This offer is withdrawn if not accepted by June 12, 1998. Mr. Dieguez executed the purchase agreement and returned it to Spooner by fax for Spooner to make an $87,000 offer on the yacht. The terms of the purchase agreement required Mr. Dieguez to send ten percent of the purchase price as earnest money. Pursuant to the purchase agreement, the seller had only one day to respond to the offer after Mr. Dieguez faxed the purchase agreement to Spooner. Thus, Mr. Dieguez asked Spooner where to electronic funds transfer (EFT) his earnest money. Spooner faxed Mr. Dieguez instructions to make his check out to the Boating Center of Fort Lauderdale (Boating Center), the seller's agent or the seller, and to send the funds to Boating Center. In Mr. Dieguez' previous attempt to purchase a yacht through C & S, he had been given instructions to send his deposit by EFT to C & S's escrow account. Mr. Dieguez contacted Mr. Saumsiegle and asked why he was supposed to send a check to Boating Center. Mr. Saumsiegle was unaware that Spooner was trying to sell Mr. Dieguez a boat through Boating Center and that he had directed Mr. Diequez to send a check to Boating Center. Ultimately, Mr. Dieguez did not send a deposit and did not purchase the yacht. Mr. Saumsiegle terminated Spooner's relationship with C & S Marine in July 1998. Boating Center is not a licensed yacht brokerage.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Richard Spooner violated Subsections 326.006(2)(e)1, 3, and 6, Florida Statutes; suspending his salesperson's license for two years; and imposing an administrative fine of $5,000. DONE AND ENTERED this 15th day of December, 1999, in Tallahassee, Leon County, Florida. SUSAN B. KIRKLAND Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 15th day of December, 1999. COPIES FURNISHED: Philip Nowick, Director Division of Florida Land Sales, Condominiums and Mobile Homes Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 Barbara D. Auger, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 William Oglo, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 Richard J. Zaden, Esquire Zaden & Wardell, P.A. 1749 Northeast 26th Street, Suite 200 Fort Lauderdale, Florida 33305
